THE Supreme Court (SC) has upheld a Court of Appeals (CA) ruling that found I-People Manpower Resources, Inc. and Elec Qatar liable for illegally dismissing one of its electrical engineers.
In a 16-page decision dated Jan. 2 and made public on July 4, the High Court said the validity of the company’s retrenchment exercise was not proved. The retrenchment led to Jomer O. Monton’s dismissal.
I-People Manpower and Mr. Monton’s Qatar employer Elec Qatar were ordered to pay Mr. Monton’s unpaid salary of 72,000 Qatari riyals (about P1.1 million), placement fees charged 12% interest, and legal fees charged 10% interest.
The recruitment firm argued that the engineer’s dismissal was due to retrenchment because of lack of activity in Elec Qatar. It described the dismissal as “management prerogative.”
“Monton could only be dismissed if both the substantive and procedural due process requirements under the Labor Code are complied with,” according to the ruling, written by Associate Justice Jhosep P. Lopez.
Under the Labor Code, a retrenchment is valid if a company can prove that it can avoid losses and if fair and reasonable criteria were used in dismissing employees.
In 2013, Mr. Monton was hired by Elec Qatar, which performs electro-mechanical services, through the manpower firm for two years. He was given a monthly basic salary of 6,000 riyals or about P90,000.
The employment contract gave Elec Qatar the option to terminate given one month’s notice.
A year later, Mr. Monton received a termination letter from Elec Qatar, which cited low activity levels, prompting the company to reduce staffing levels.
The National Labor Relations Commission (NLRC) affirmed the labor arbiter’s decision to reject the engineer’s illegal dismissal claim, upholding the legality of his dismissal.
The NLRC said Mr. Monton’s contract only required compliance with the one-month notice clause.
The appellate court overturned the decision, saying Elec Qatar could not just “unilaterally” terminate an employment contract at will.
“Basic is the rule that an employee may be dismissed from service only for just or authorized causes which must be shown by clear and convincing evidence,” the High Court said. — John Victor D. Ordoñez
