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PRIMO E. CAONG v. AVELINO REGUALOS

FACTS:

The petitioners in this case, Primo E. Caong, Jr., Alexander J. Tresquio, and Loriano D. Daluyon, were employed as drivers by respondent Avelino Regualos under a boundary agreement. They filed separate complaints for illegal dismissal against the respondent, claiming that they were barred from driving the vehicles due to deficiencies in their boundary payments.

The petitioners contended that they were unlawfully dismissed without just cause and that the respondent's policy of automatically dismissing drivers who fail to remit the full amount of the boundary violated their right to due process.

On the other hand, the respondent argued that the petitioners were not employees but rather lessees of his vehicles. The respondent also asserted that the petitioners had incurred substantial arrears in their boundary payments.

The Labor Arbiter ruled in favor of the respondent and acknowledged that an employer-employee relationship existed between the parties. The Labor Arbiter further determined that the petitioners were not dismissed but could resume work once they paid their arrears.

The National Labor Relations Commission (NLRC) affirmed the Labor Arbiter's decision. Subsequently, the Court of Appeals (CA) found no grave abuse of discretion on the part of the NLRC based on the petitioners' appeal.

As a result, the petitioners sought recourse by filing a petition for certiorari with the CA, challenging the NLRC's decision.

ISSUES:

  1. Whether the drivers were illegally dismissed by the respondent.

  2. Whether there was a violation of due process in the dismissal.

  3. Whether the company policy on remittances is fair and reasonable

  4. Whether the scarcity of passengers is a valid excuse for not remitting the full amount of the boundary

  5. Whether the petitioners were denied due process

RULING:

  1. The drivers were not illegally dismissed but were merely suspended pending payment of their arrears. There was no intent on the part of the respondent to sever the employer-employee relationship between them. The suspension could have been ended if the drivers paid their arrears, but they chose not to do so, which prolonged their suspension. The suspension was a reasonable disciplinary measure imposed by the respondent.

  2. There was no violation of due process in the dismissal. The case does not involve a termination of employment, so the strict application of the twin-notice rule is not warranted. The drivers were given the opportunity to be heard during the meeting conducted by the respondent, where they were informed of the policy regarding remittances and warned of the consequences of non-compliance.

  3. The company policy on remittances is fair and reasonable. The management has the prerogative to establish policies, rules, and regulations as long as they are fair and reasonable. The only limitation is that the penalties must be commensurate to the offense.

  4. The scarcity of passengers is not a valid excuse for not remitting the full amount of the boundary. Unless there is clear evidence or explanation of an event that irregularly and negatively affected the usual number of passengers, the scarcity of passengers should not excuse the driver from paying the full amount of the boundary.

  5. The petitioners were not denied due process. While the strict application of the twin-notice rule is not warranted in this case, the essence of due process is the opportunity to be heard. As long as the parties are afforded a fair and reasonable opportunity to explain their side or seek reconsideration, due process is satisfied.

PRINCIPLES:

  • The relationship between jeepney owners/operators and drivers under the boundary system is that of employer-employee and not of lessor-lessee.

  • Findings of fact of the Court of Appeals, particularly when in agreement with those of the Labor Arbiter and the National Labor Relations Commission, are accorded respect and finality, as long as they are supported by substantial evidence.

  • An employer has the discretion to instill discipline on employees and impose penalties, such as dismissal, if warranted. It is a management prerogative.

  • Management has the prerogative to establish policies, rules, and regulations as long as they are fair and reasonable.

  • Penalties must be commensurate to the offense involved and to the degree of the infraction.

  • A company policy must be implemented with social justice and compassion.

  • The scarcity of passengers is not a valid excuse for not remitting the full amount of the boundary.

  • Due process requires an opportunity to be heard and explain one's side or seek reconsideration. A formal or trial-type hearing is not always necessary.