The Reality of Labor Courts: Avoiding Costly Mistakes in Employee Dismissals
We have heard the connotation that labor courts are supposedly “pro-employees”. This is clearly manifested when companies always appear to be on the losing side in illegal dismissal cases. There are a few reasons for this. Employers either had the wrong or incompetent HR managers, managers who do not understand labor and industrial relations, or they went too far by firing an employee who reportedly committed a misconduct.
Imagine this, for instance. An employee was heard uttering bad words to his boss while making the dirty finger gesture at a Christmas gathering wherein alcoholic beverages were served. But the boss was not around at the party. Any boss would like to have a payback by terminating that employee if he heard that incident since the employee apparently made a serious misconduct, right? Understandably. Ultimately, that employee got sacked. Feeling aggrieved, the employee filed an illegal dismissal case against his former boss. Believe it or not, the Supreme Court said that the employee was illegally dismissed. According to the ponencia, Justice Kapunan, “whatever missteps may be committed by labor ought not to be visited with a consequence so severe. It is not only because of the law’s concern for the workingman. There is, in addition, his family to consider.” (Samson vs. NLRC; G.R. No. 121035, April 12, 2000). Justice Kapunan is essentially saying to the employer, have a heart once in a while!
Another reason why employers lose their cases, admittedly because they really deserve it, is that they do not pay the wages of the employees on time (or not at all). For the employers out there, remember that such an act could be considered an unlawful withholding of wages, which is a violation of Article 116 of the Labor Code. Worse, it could be considered as constructive dismissal.
Another instance is that employment contracts prepared by the HR Department are so comically bad that lawyers for the complaining employees would have a field day in litigating in labor courts. Take this, for instance. Maria was hired by a call center company as a Customer Service Representative. She signed a contract prepared by the HR Department with the bold letters “PROBATIONARY EMPLOYMENT CONTRACT” imprinted on its face. The contract also states that the duration of the probationary period is up to six months, and failure to observe the regularization standards would mean non-regularization. Maria affixed her signature on the contract as evidence to prove that she agrees with its terms and conditions. Sounds failproof, right?
Nonetheless, Maria was terminated because she was supposedly not fit for regularization. Subsequently, Maria filed an illegal dismissal complaint. The Labor Arbiter ruled that Maria was illegally dismissed. On appeal, the Commissioners of the NLRC affirmed the ruling of the Labor Arbiter. Essentially, both courts ruled that Maria was illegally terminated as a probationary employee. When the case reached the Court of Appeals, it made a 360 turn and overruled the Labor Arbiter and the NLRC by deciding that the employer did not inform Maria of the standards of regularization. Thus, according to the appellate court, Maria is deemed a regular employee, not merely a probationary employee. When the case reached the Supreme Court, the Justices ruled in favor of Maria that she is considered a regular employee despite being tagged as a probationary employee, since the employer “neither presented any evidence, such as a handbook, operations manual, performance appraisal document nor at least alleged that it informed [Maria] of the criteria for regularization.” (Simon vs. The Results Companies, G.R. Nos. 249351-52, 29 March 2022). The lesson to be learned from here: don’t judge the contract by the title.
For our modern-day heroes, the OFWs, a lot of them were illegally dismissed, too, much to our regret. In the 2020 Supreme Court case of Omanfil International Manpower Corporation vs. Mesina, the employee there, Mr. Mesina, was repatriated and terminated by the employer because he purportedly had heart disease, which prevented him from working properly. Ultimately, the Supreme Court came to the rescue and ruled that Mr. Mesina was illegally terminated because the employer failed to prove by substantial evidence the following: (a) the employee suffers from a disease which cannot be cured within six months and his/her continued employment is prohibited by law or prejudicial to his/her health or to the health of his/her co-employees, and (b) a certification to that effect must be issued by a competent public health authority. (G.R. No. 217169, November 04, 2020).
In June 2020, the Supreme Court once again sided with an OFW and ruled that he was illegally dismissed. According to Justice Lazaro-Javier, while the employer presented evidence to supposedly show that the employee committed an infraction, the pieces of evidence are mostly self-serving evidence. (G.R. No. 240123 & G.R. No. 240125, June 17, 2020).
The most popular reason, if not the leading cause of employers losing cases, is that management does not practice proper documentation. Based on the survey of Supreme Court cases, HR managers apparently do not keep records and handle documents correctly. They neglect to prepare incident reports or written explanations, and some are found to issue termination letters outright without securing vital evidence, like CCTV footages, affidavits of witnesses, and transaction records, among others. All these contribute to why employers lost their cases. Regrettably, despite their job title as an “HR Manager”, some managers really do not know how to apply all the steps in complying with the due process requirements under our labor laws, and their decision to terminate employees is based on pure rumors and hearsay. To stress, a case is won primarily by the evidence, not by Ms. Marites J
Labor cases can go on and on, and we might never have a day when employers win their cases all of the time. It is a reality that we have to face, given the lackadaisical attitude of some HR Managers in looking out for the management. Consequently, employers keep getting hit with court orders to pay employees back wages, separation pay, and sometimes even damages. On top of that, they are also on the hook for legal interest and attorney’s fees. A simple employee who earns a meager PhP 18,000.00 a month in Metro Manila might end up receiving PhP 1,800,000.00 if he or she is declared illegally dismissed. And that is one employee only. Imagine if there are ten of them.
At the end of the day, labor laws should not be considered the prophet of doom for employers. They were legislated for a reason. They strike a balance between the haves and the have-nots. That is why we commemorate May 1 every year to celebrate the birthday of the Labor Code. To be precise, the Labor Code was enacted on 1 May 1972. Yes, you read it right. It’s a vintage law, as old as our parents and, interestingly, made during the Martial Law.
