View full case

PHESCHEM INDUSTRIAL CORPORATION v. PABLITO V. MOLDEZ

FACTS:

Petitioner Pheschem Industrial Corporation employed the respondent, Pablito V. Moldez, as an operator of its payloader and bulldozer at its quarrying site in Palompon, Leyte. On November 13, 1997, respondent was suspended from work for seven days without pay without being informed of the reason. After seven days, the suspension was extended for another seven days without pay, again without any reason given. When respondent inquired about his employment status, he was assured that he would be rehired but he received no word from petitioner for eight months. On July 6, 1998, respondent filed a complaint for illegal suspension and dismissal and prayed for reinstatement, or alternatively, an award of separation pay, moral damages, and attorney's fees. Petitioner alleged that respondent was dismissed for just cause due to his gross negligence in failing to inspect the bulldozer, which resulted in its damaged parts and production delay. The labor arbiter ruled in favor of the respondent, declaring the dismissal as illegal and ordering petitioner to reinstate respondent and pay his backwages. The NLRC and the Court of Appeals affirmed the labor arbiter's decision. Petitioner appealed to the Supreme Court, raising several assigned errors.

ISSUES:

  1. Whether or not the Court of Appeals erred in dismissing the petition and affirming the decision of the NLRC ordering the reinstatement of the respondent without loss of seniority rights.

  2. Whether or not the dismissal of the respondent was for a just cause based on gross and habitual neglect of duty.

  3. Whether or not the respondent is entitled to backwages despite being gainfully employed with another firm after his dismissal.

RULING:

  1. The Court of Appeals did not err in dismissing the petition and affirming the decision of the NLRC. The petitioner failed to establish any reversible error in the findings and conclusions of the labor arbiter and the NLRC.

  2. The dismissal of the respondent was not for a just cause based on gross and habitual neglect of duty. The petitioner failed to present substantial evidence to prove that the respondent was grossly negligent in inspecting the bulldozer before operating it. Therefore, the respondent's dismissal was deemed illegal.

  3. The respondent is entitled to backwages despite being gainfully employed with another firm after his dismissal. The fact that the respondent was able to secure employment does not negate the fact that he was illegally dismissed and entitled to all the benefits and rights that he would have received if he had not been unlawfully terminated.

PRINCIPLES:

  • In order for dismissal to be considered legal, there must be just cause and due process.

  • The burden of proof lies with the employer to prove the existence of just cause for dismissal.

  • Backwages are awarded to an illegally dismissed employee to provide compensation for the income they would have earned if not for the unlawful termination.