[G.R. No. 143617. September 4, 2000]

SWIFT FOODS, INC. vs. CEFERINO P. BUHAIN, et al.

SECOND DIVISION

Gentlemen:

Quoted hereunder, for your information, is a resolution of this Court dated SEPT 4 2000.

G.R. No. 143617 (Swift Foods, Inc. v. Ceferino P. Buhain and Voluntary Arbitrator Ramon T Jimenez.)

Private respondent Ceferino P. Buhain was a sales supervisor of petitioner Swift Foods, Inc. Among his duties was to receive the remittance of salesmen and make inventories of the stocks in the warehouse of petitioner in San Jose, Bulacan. While Buhain was on sick leave, an audit was conducted and he was found to have failed to account for a P2,500,000.00 collection of Roslin Enfestan, a salesman under his supervision.

Buhain denied knowledge of the irregularity, alleging that, when he went on leave on April 8, 1996, there was no shortage or unaccounted stock. On May 11, 1996, he reported to one of petitioner's legal counsels, Atty. Jofe Atenta, who interrogated him in the presence of Willie Pacres, national sales supervisor, and an auditor of the company. Thereafter, an affidavit in a question and answer form was executed and signed by Buhain under oath before Atty. Atenta. Roslin Enfestan and warehouseman Vicente Mateo executed their affidavits implicating Buhain in the anomalies at the San Jose warehouse, but their statements were not shown to Buhain.

On May 13, 1996, the day before his leave of absence expired, Buhain received a memorandum from Pacres placing him under preventive suspension for gross violation of company rules and regulations and standard operating procedures. A week later, on May 21, 1996, his services were terminated.

As Buhain contested his dismissal, the matter was submitted to a voluntary arbitrator, Ramon T. Jimenez, who ruled in favor of Buhain. The arbitrator found that Buhain had not been given notice and hearing before he was dismissed. He was found to have been illegally dismissed and petitioner was required to reinstate him and to pay him moral damages and attorney's fees. On appeal to the Court of Appeals, the decision of the voluntary arbitrator was affirmed with the modification that instead of reinstatement of private respondent, petitioner was required to pay separation pay on the ground of the strained relations between the parties. Hence, this petition seeking review of the appellate court's decision.

After due consideration of the foregoing, the Court RESOLVED to DENY the petition for review on certiorari for lack of showing of any reversible error by the Court of Appeals.

First. Petitioner contends that the Court of Appeals erred in finding that respondent was not apprised of the charge against him. Petitioner maintains that "no formal hearing was necessary, not only because the respondent did not ask for it but also because, when he was being investigated by the respondent's in-house counsel, the last question posed to him was whether he had anything more to say and his answer was that he had nothing to add to what he had already stated."

This contention has no merit. Under the law, before an employee may be dismissed, he must be given notice and hearing and his dismissal must be for a cause provided in the Labor Code. The burden of proving compliance with these requirements is on the employer (Bondoc National Labor Relations Commission, 276 SCRA 288 (1997)).

In this case, it is admitted that no written notice of the charges was given to respondent as required in Rule XIV, Book V, �2 of the rules implementing the Labor Code. Petitioner contends, however, that respondent was informed of the charges when he was given a written notice of preventive suspension stating that "the results of an internal audit conducted for the period covering May 10 to May 13, 1996 shows that the San Jose Bulacan warehouse under your supervision has unremitted collection amounting to Two Million Five Hundred Thousand Pesos (P2,500,000.00)." This is insufficient. Two notices must actually be given. Before the investigation, he should have been given notice of the charges against him. Then, if after investigation he was found guilty, he should have been given notice of the grounds for his dismissal. The notice given to Buhain was the second notice required by law to be given to an employee before he is dismissed for a just cause. The Court of Appeals correctly ruled that the notice of suspension given to Buhain cannot be considered a substitute for the first written notice required by the law.

Nor was the employee afforded adequate opportunity to be heard and defend himself. The only semblance of a hearing conducted by petitioner was his interrogation by Atty. Atenta. Respondent was supposed to meet his accusers, Enfestan and Mateo, but the confrontation did not take place. The sworn statements of by Enfestan and Mateo, as well as the audit report for the San Jose warehouse, which formed the basis of petitioner's decision to dismiss Buhain, were not shown to him. Private respondent was thus denied reasonable opportunity to contest the charges against him.

Second. Petitioner argues that notwithstanding the denial of notice and hearing to the employee, the latter's termination was valid and that, in accordance with the ruling in Wenphil v. NLRC, 170 SCRA 69 (1989) all that petitioner was required to do was pay an indemnity of P1,000.00 to P5,000.00 for the violation of private respondent's right to notice and hearing.

This contention likewise has no merit. To be sure, the Wenphil doctrine has already been superseded by the decision in Serrano v. National Labor Relations Commission (G.R. No.117040, January 27, 2000) in which it was held that if an employee is separated for an authorized cause or dismissed for a just cause, but the employer failed to comply with the requirements of notice and hearing, the employee should be given either separation pay in case of separation for authorized cause, or backwages in case of dismissal for a just cause. The separation pay or backwages are to be paid for the period that he is out of job, until it is finally decided by the NLRC that his termination is for an authorized cause or for a just cause.

But whether it is under this doctrine or under that of Wenphil, the employee will be able to recover only separation pay or backwages if it is shown in a subsequent proceeding before the NLRC that his dismissal was for a cause provided by the law. The rule does not apply where the legality of the dismissal is based on evidence presented in the very hearing found to be irregular because the employee was not fully heard.

In this case, neither the voluntary arbitrator nor the Court of Appeals found respondent was responsible for the P2,500,000.00 in collection losses incurred by petitioner. To the contrary, the Court of Appeals held that the allegations of Enfestan in his affidavit were not substantiated.

Very truly yours,

(Sgd.) TOMASITA B. MAGAY-DRIS

Clerk of Court�


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