Suspended not dismissed

Management prerogative means the right of the employer to regulate all aspects of employment, to discipline its employees and to impose appropriate penalties on erring workers pursuant to company rules and regulations, such as suspension from work or dismissal from service. This case is about suspension and dismissal.

This is the case of the brothers Tom and Cris who were hired by a company engaged in motor vehicle repair (ITEI) on November 14, 1978 and May 11, 1984 respectively. Tom was employed as diesel mechanic while Cris was the officer-in-charge of ITEI’s shop in QC.

On March 28, 1998, the administration manager (Admin) issued a memo suspending Tom and Cris and another employee, Ferdie for ten (10) working days for alleged disobedience, incompetence and gross negligence because they released the motor vehicle of Tino, one of the company’s regular customers, who brought his vehicle to the shop for repairs, despite the direct and clear instruction of the company president not to release the same until and unless Tino made full settlement of his obligation which remained unpaid since 1996.

After the lapse of ten days suspension, Tom and Cris did not report for work and were considered AWOL. The following day another memo was issued by the admin directing them to explain why they failed to report for work.

But instead of explaining, Tom and Cris filed a complaint for illegal dismissal before the NLRC with prayer for payment of separation pay in lieu of reinstatement, backwages and damages against ITEI. They alleged that they were actually prohibited from entering the company premises when they tried to return to work.

After proper proceedings, the Labor Arbiter (LA) dismissed their complaint for lack of merit but ordered the payment of separation pay of one half month for every year of service in conformity with Labor justice considering their long service. Was the LA correct?

Yes. Dismissal connotes a permanent severance or complete separation of the worker from service on the initiative of the employer regardless of the reasons therefore. It can hardly be said that Tom and Cris were dismissed from the service rather than merely suspended. They did not dispute that they were merely suspended as shown by the memorandum issued to them. This memo clearly disproves that they were terminated from employment supposedly based on a memorandum prohibiting them from entry into the company premises.

There is also no dispute that their suspension was based on valid grounds because of their clear defiance of the company president’s order not to release the car of Tino until he fully settled his obligation. The company was clearly acting within their right in suspending Tom and Cris. Their complaint for illegal dismissal was premature, since after the expiration of the suspension period, they refused despite due notice to report for work.

The decision of the LA finding that Tom and Cris abandoned their positions by failing to return to work despite management directives to do so and awarding separation pay of P56,680 each is therefore correct and must be sustained. But since the Company failed to follow the required notices after Tom and Cris abandoned their positions, it should also pay them P30,000 each as damages (Industrial & Transport Equipment Inc. etc. vs. Tugade, G.R. 158539, January 15, 2009).

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