FACTS:

The respondents in this case were former drivers/helpers of JR Hauling Services who filed a complaint against their employer and its manager for illegal dismissal and underpayment/non-payment of salaries and benefits. The respondents claimed that they were dismissed without notice and hearing, and were not paid their respective benefits. On the other hand, the petitioners alleged that the respondents incurred shortages in their deliveries and were involved in anomalous transactions, justifying their dismissal. The Labor Arbiter ruled in favor of the respondents, ordering their reinstatement and awarding them backwages and other benefits. The petitioners appealed to the NLRC, which reversed the LA's ruling and held that the respondents were validly dismissed on grounds of loss of trust and confidence. The respondents filed a motion for reconsideration, which was denied. They then filed a petition for certiorari before the CA, alleging grave abuse of discretion by the NLRC. The CA ruled in favor of the respondents, setting aside the NLRC decision and ordering their reinstatement and payment of backwages. The petitioners raised several issues before the Supreme Court.

ISSUES:

1. Whether the Supreme Court has the authority to review factual questions;

2. Whether the alleged transgressions of the respondents are supported by substantial evidence.

3. Whether there was substantial proof of respondents' participation in the alleged delivery shortages of broilers.

4. Whether the affidavits presented by petitioners are admissible to establish respondents' involvement in the unauthorized sale of excess broilers and broiler crates.

5. Whether or not the affidavit presented by the witness should be given more weight than the petitioner's bare allegation.

6. Whether or not the documents submitted by the private respondents are admissible as evidence.

7. Whether respondents' acts amounted to serious misconduct, fraud, or willful breach of trust and confidence.

8. Whether respondents' dismissal from employment was justified.

9. Whether the petitioners complied with the procedural requisites in terminating the respondents' employment.

10. Whether the respondents are entitled to nominal damages.

11. Whether the burden of proof rests on the employer to prove payment in claims involving salary differentials.

12. Whether the respondents are entitled to salary differentials.

13. Whether respondent Oscar Mapue should be dropped as a party-respondent.

RULING:

1. The Supreme Court may review factual questions in certain cases where there is a conflict between the factual findings of lower courts or tribunals. In the present case, since there is a conflict between the factual findings of the Labor Arbiter (LA) and the Court of Appeals (CA), on one hand, and those of the National Labor Relations Commission (NLRC), on the other, the Supreme Court will take cognizance of and resolve the factual issues involved.

2. The party alleging the existence of a fact or thing necessary to establish their claim has the burden of proving the same by substantial evidence. In labor proceedings, substantial evidence refers to "such relevant evidence as a reasonable mind might accept as adequate to support a conclusion." The quantum of proof required in an illegal dismissal case is merely substantial evidence, which only requires evidence to support a conclusion, even if other reasonable minds might have a different opinion. The ground for dismissal of an employee does not require proof beyond reasonable doubt.

3. The Court found no cogent basis to impute respondents' involvement in the alleged delivery shortages of broilers absent substantial proof of their participation in the act in question.

4. The Court held that the affidavits presented by petitioners, although taken ex parte, are admissible and sufficient to establish respondents' involvement in the unauthorized sale of excess broilers and broiler crates. The rules of evidence prevailing in courts of law do not control proceedings before labor tribunals, and affidavits may be sufficient to establish substantial evidence.

5. The affidavit presented by the witness should be given more weight than the petitioner's bare allegation. The Court gives credence to the affidavit of the witness as it is supported by evidence, while the petitioner failed to present convincing evidence to rebut the assertions made by the witness.

6. The documents submitted by the private respondents are admissible as evidence. In labor cases, the rules of evidence prevailing in courts of law or equity are not controlling. It is sufficient that the documents submitted have a bearing on the issue at hand and support the positions taken by the parties.

7. Respondents' acts constituted serious misconduct which warranted their dismissal from employment. The unauthorized sale of excess broilers and broiler crates, which involved respondents, constituted an act of dishonesty and a breach of trust and confidence reposed by the employer.

8. There was just cause for respondents' dismissal from the service.

9. The petitioners failed to comply with the procedural requisites in terminating the respondents' employment, therefore entitling the respondents to nominal damages.

10. The respondents are entitled to nominal damages of P30,000.00 each.

11. In claims involving salary differentials, the burden of proof rests on the employer to prove payment.

12. The respondents are entitled to salary differentials, subject to applicable prescriptive periods.

13. Respondent Oscar Mapue should be dropped as a party-respondent.

PRINCIPLES:

• The Supreme Court is generally not a trier of facts but may review factual questions in certain situations.

• Substantial evidence is the quantum of proof required in labor proceedings.

• The ground for dismissal of an employee does not require proof beyond reasonable doubt.

• Labor tribunals are not bound by the technical niceties of law and procedure and may reach decisions based on position papers, supporting documents, affidavits, and other allied pleadings.

• In labor proceedings, the rules of evidence prevailing in courts of law or equity do not control. The labor tribunals are mandated to use every reasonable means to ascertain the facts speedily and objectively in the interest of due process.

• Affidavits, even if taken ex parte, may be admissible and sufficient to establish substantial evidence in labor cases.

• A document acknowledged before a notary public enjoys the presumption of regularity and is considered a prima facie evidence of the facts stated therein.

• A notarized document carries the evidentiary weight conferred upon it with respect to its due execution. It has the presumption of regularity, which can be rebutted only by clear and convincing evidence of its falsity.

• The burden of proof to overcome the presumption of due execution of a notarial document lies with the one contesting it.

• In labor cases, the rules of evidence prevailing in courts of law or equity are not controlling. It is sufficient that the documents submitted have a bearing on the issue at hand and support the positions taken by the parties.

• Affidavits of co-employees can be substantial evidence to prove charges against an employee subject to illegal dismissal cases. Statements of co-employees are given utmost weight and credence and cannot simply be disregarded.

• Misconduct is the transgression of an established and definite rule of action, implying wrongful intent and not mere error in judgment. Serious misconduct justifying dismissal must be serious, relate to the performance of the employee's duties, and show that the employee has become unfit to continue working for the employer.

• Loss of trust and confidence as a ground for dismissal applies to employees in positions of trust who have breached the trust and confidence reposed on them. The act complained of must be work-related and show that the employee is unfit to continue working for the employer. The nature of the work performed by the employee is material in determining whether they hold a position of greater trust and responsibility.

• Procedural due process in dismissal cases requires a written notice specifying the grounds for termination and giving the employee an opportunity to explain their side, as well as a written notice of termination indicating that grounds have been established to justify the termination. Failure to comply with this procedure may invalidate the dismissal.

• Allegations which are not specifically denied are deemed admitted.

• Due process must be observed before an employee can be dismissed from employment.

• The burden of proof in claims involving salary differentials rests on the employer to prove payment.

• The employer must present evidence to disprove an employee's allegations in claims for salary differentials.

• Bad faith or malice must be proven for a party to be held liable in dismissal cases.