DISTRIBUTION & CONTROL PRODUCTS, INC./VINCENT M.

TIAMSIC, petitioners,
vs.
JEFFREY E. SANTOS, respondent.
PERALTA, J.
G.R. No. 212616
July 10, 2017

Case Summary: A criminal complaint was filed against the petitioner for the theft of various electrical
products owned by the petitioner. Respondent was then placed under preventive suspension for 30
days, after which he was no longer allowed to attend to work. Respondent filed an illegal dismissal case
against the petitioner. The LA, NLRC and the CA all ruled in favor of the respondent. Hence the petition
for review on Certiorari. The Court ruled that employees enjoy Tenurial Security under the Constitution:
what this means is that an employer shall not dismiss an employee except for a just or authorized cause
and only after due process is observed. The Petitioner failed to prove by substantial evidence that the
termination of the respondent was for just cause. The petition is denied.

Facts:
 Petitioner is a domestic corporation engaged in the business of selling and distributing electrical
products and equipment with petitioner Vincent M. Tiamsic as its president.
 Respondent was employed as petitioners’ company driver.
 July 25, 2011 - respondent filed against petitioners a complaint for constructive illegal dismissal
and payment of separation pay
o April 5, 2005 - he started working as petitioners’ company driver
o December 16, 2010 – respondent received a notice informing him that he was being
placed under preventive suspension for a period of 30 days beginning December 17,
2010 because he was one of the employees suspected of having participated in the
unlawful taking of circuit breakers and electrical products of petitioners
 a criminal complaint was filed against him and several other persons with the
Prosecutor’s Office of Mandaluyong City;
 he immediately inquired from petitioner company’s Human Resources
Department as to the exact reason why he was suspended because he was
never given the opportunity to explain his side before he was suspended but the
said Department did not give him any concrete explanation;
 after the lapse of his 30-day suspension he was no longer allowed to return to
work without any justification for such disallowance
 Petitioner stated that they employed respondent as their company driver whose job included
the delivery of items purchased by customers, receipt documentation and recording of
previously purchased products which were returned by customers and coordination with the
company warehouseman and the accounting department concerning all items which are subject
of delivery and receipt by the company
 petitioner corporation, through its hired auditors, conducted a physical stock inventory of all
materials stored in the company’s warehouse and in its office building;
o February 19, 2010 - a number of electrical materials and products with an estimated
value of P457,394.35, were missing;
 o April 24, 2010 - a 2000-ampere circuit breaker worth P106,341.75 and 37 pieces of 40-
ampere circuit breakers which had a total value of P39,940.04 were also missing;
o Respondent and the company warehouseman were the only persons who had complete
access to the company warehouse as they were entrusted with the handling of all
products from the company’s suppliers;
o considering the size and weight of the missing items, they can only be carried by no less
than 2 persons;
o petitioners demanded an explanation from respondent but they failed to give an
explanation.
o petitioners filed a criminal complaint for qualified theft and, thereafter, they suspended
herein respondent;
o and after the lapse of his suspension, respondent no longer returned to work.
 January 30, 2012 - the LA found the respondent to be illegally terminated from his employment,
and ordered his reinstatement and payment of his full backwages amounting to P297,916.67.
The LA held that herein petitioners had the burden of proving that respondent’s dismissal was
valid and their failure to discharge this burden only means that the dismissal was not justified
and, therefore, illegal.
 May 16, 2012 - the NLRC affirmed, with modification, the decision of the LA. In addition to the
payment of backwages, the NLRC ordered petitioners to pay respondent separation pay
equivalent to 1 month for every year of service, instead of reinstatement.
 June 25, 2012 - Petitioners Motion for Reconsideration in the NLRC was denied
 November 22, 2013 - the CA denied the certiorari petition and affirming the questioned NLRC
Decision and Resolution.
 May 20, 2014 - Petitioners Motion for Reconsideration was denied in the CA Resolution.
 Hence, the present petition for review on Certiorari

Issue and Held:

1. Whether or not the respondent’s security of tenure was violated. YES
 Tenurial Security under the Constitution - What this means is that an employer shall not
dismiss an employee except for a just or authorized cause and only after due process is
observed.
 In determining whether an employee’s dismissal had been legal, the inquiry focuses on
whether the dismissal violated his right to substantial and procedural due process.
Compliance with procedure provided in the Labor Code, on the other hand, constitutes
the procedural due process right of an employee.
 Termination without a just or authorized cause renders the dismissal invalid, and
entitles the employee to reinstatement without loss of seniority rights and other
privileges and full backwages, inclusive of allowances, and other benefits or their
monetary equivalent computed from the time the compensation was not paid up to the
time of actual reinstatement.
 An employee’s removal for just or authorized cause but without complying with the
proper procedure, on the other hand, does not invalidate the dismissal. It obligates the
erring employer to pay nominal damages to the employee, as penalty for not complying
with the procedural requirements of due process.
  Thus, two separate inquiries must be made in resolving illegal dismissal cases: first,
whether the dismissal had been made in accordance with the procedure set in the Labor
Code; and second, whether the dismissal had been for just or authorized cause
 the burden of proof rests upon the employer to show that the dismissal is for just and
valid cause; failure to do so would necessarily mean that the dismissal was illegal.
 If doubt exists between the evidence presented by the employer and the employee, it
must be resolved in favor of the latter.
 Moreover, the quantum of proof required in deter mining the legality of an employee’s
dismissal is only substantial evidence. Substantial evidence is more than a mere scintilla
of evidence or relevant evidence as a reasonable mind might accept as adequate to
support a conclusion, even if other minds, equally reasonable, might conceivably opine
otherwise
 Petitioner’s stated their loss of trust and confidence to the respondent.
 Loss of trust and confidence is a just cause for dismissal under Article 282(c) of
the Labor Code, which provides that an employer may terminate an
employment for “[f]raud or willful breach by the employee of the trust reposed
in him by his employer or duly authorized representative.”
 Two conditions:
 First, the employer must show that the employee concerned holds a
position of trust and confidence.
 Second, the employer must establish the existence of an act justifying
the loss of trust and confidence. To be a valid cause for dismissal, the
act that betrays the employer’s trust must be real, i.e., founded on
clearly established facts, and the employee’s breach of the trust must
be willful, i.e., it was done intentionally, knowingly and purposely,
without justifiable excuse. Moreover, with respect to rank-and-file
personnel, loss of trust and confidence, as ground for valid dismissal,
requires proof of involvement in the alleged events in question, and
that mere uncorroborated assertions and accusations by the employer
will not be sufficient.
 Thus, when the breach of trust or loss of confidence alleged is not borne by
clearly established facts, as in this case, such dismissal on the cited grounds
cannot be allowed.
 Applied to the present case, the LA, NLRC and the CA are unanimous in their
finding that petitioners were not able to discharge their burden of proving that
their termination of respondent’s employment was for a just and valid cause.
 A quick perusal of the records at hand would show that petitioners failed to
present substantial evidence to support their allegations that respondent had,
in any way, participated in the theft of the company’s stolen items and that
after his preventive suspension he no longer reported for work.
2. Whether or not the 2-notice rule was complied with. NO
 procedural due process consists of the twin requirements of notice and hearing.
 The employer must furnish the employee with two written notices before the
termination of employment can be effected:
 o (1) the first apprises the employee of the particular acts or omissions for which
his dismissal is sought; and
o (2) the second informs the employee of the employer’s decision to dismiss him.
The requirement of a hearing is complied with as long as there was an
opportunity to be heard, and not necessarily that an actual hearing was
conducted.
 The only notice given by petitioners to respondent was the notice of his 30-day
preventive suspension and, as found by the LA, nothing therein indicated that he was
required nor was given the opportunity to explain his side. It is true that petitioners
conducted their own investigation but the same was made without the participation of
respondent.
o The first written notice to be served on the employees should contain the
specific causes or grounds for termination against them, and a directive that the
employees are given the opportunity to submit their written explanation within
a reasonable period. “Reasonable opportunity” under the Omnibus Rules means
every kind of assistance that management must accord to the employees to
enable them to prepare adequately for their defense. This should be construed
as a period of at least five (5) calendar days from receipt of the notice. The
notice should contain a detailed narration of the facts and circumstances that
will serve as basis for the charge against the employees. Lastly, the notice
should specifically mention which company rules, if any, are violated and/or
which among the grounds under Art. 282 is being charged against the
employees
o After serving the first notice, the employers should schedule and conduct a
hearing or conference wherein the employees will be given the opportunity to:
(1) explain and clarify their defenses to the charge against them; (2) present
evidence in support of their defenses; and (3) rebut the evidence presented
against them by the management. During the hearing or conference, the
employees are given the chance to defend themselves personally, with the
assistance of a representative or counsel of their choice. Moreover, this
conference or hearing could be used by the parties as an opportunity to come to
an amicable settlement.
o After determining that termination of employment is justified, the employers
shall serve the employees a written notice of termination indicating that: (1) all
circumstances involving the charge against the employees have been
considered; and (2) grounds have been established to justify the severance of
their employment.
Decision:
WHEREFORE, the instant petition for review on certiorari is DENIED. The Decision and Resolution of
the
Court of Appeals, dated November 22, 2013 and May 20, 2014, respectively, in C.A.-G.R. S.P. No.
125911, are AFFIRMED