SUPREME COURT DECISIONS

PLEASE CLICK HERE FOR THE LATEST ➔ SUPREME COURT DECISIONS

SECOND DIVISION

G.R. No. L-58958 July 16, 1984

GRAND MOTOR PARTS CORPORATION, Petitioner, vs. THE MINISTER OF LABOR, THE REGIONAL DIRECTOR, MINISTRY OF LABOR, REGION VI, and NARCISO BELICENA, JR., Respondents.

Hector Teodosio for petitioner.chanrobles virtual law library

The Solicitor General for respondent Minister of Labor.chanrobles virtual law library

Narciso P. Belicena for private respondent.

GUERRERO, J.:

This is a petition for certiorari assailing the Order of the Minister of Labor which affirmed the decision of the Regional Director of Region VI dated November 27, 1980 directing the reinstatement of the private respondent Narciso Belicena, jr. as Branch Manager of the petitioner, Grand Motor Parts Corporation, Iloilo Branch, Iloilo City, "with backwages from the time he was dismissed (August 31, 1980, the date complainant received the letter of termination) up to the time he is actually reinstated without loss of seniority rights, benefits, and other privileges under existing laws, decrees, and agreement, verbal or written, entered into by the parties at the time of hiring." chanrobles virtual law library

Since the above decision of the Regional Director was rendered purely on the basis of the position papers of the petitioner corporation and the private respondent, without hearing nor cross-examining the parties, and petitioner claims grave abuse of discretion committed in public respondents' order for the reinstatement of the Branch Manager, We gather the antecedent facts from the respective position papers of the parties.chanroblesvirtualawlibrary chanrobles virtual law library

In the complaint filed by Narcism Belicena, Jr. against the Grand Motor Parts Corporation and Fred Cisneros as Personnel Manager dated September 4, 1980 filed with the Regional Office No. VI, Labor Relations Division, Ministry of Labor and Employment, the complainant charged respondents the following causes of action:

1. Illegal dismissal with out justifiable reason or report from the Ministry of Labor & Employment - August 25, 1980; chanrobles virtual law library

2. Reinstatement with backwages - P3,000.00 - monthly salary;chanrobles virtual law library

3. Transportation allowance as gasoline expenses - Total P300.00 at P100.00 per week since Aug. 18 to Sept. 5/80; chanrobles virtual law library

4. Non-payment of 13th month bonus - Total P1,250.00 for 5 mos. at P3,000.00 monthly salary chanrobles virtual law library

5. 1% share in net profit at the end of the year - P25,000.00.

According to the position paper submitted by Branch Manager Belicena, Jr., the "facts concerning (his) hiring and subsequent dismissal by the Grand Motor Parts Corp." are:

Just before Christmas of 1979, I met Mr. Alfredo Cisneros, who was introduced as the Acting Branch Manager of Grand Motor Parts Corporation, Iloilo Office. In the course of our conversation, he told me they need a man, preferable a CPA, to manage the Iloilo Office since he is really based in Cebu. When I told him that I am a CPA, he offered me the job. I said I will seriously consider his offer. Then, he interviewed me. In an honesty, I told who I am.chanroblesvirtualawlibrary chanrobles virtual law library

1. That I am presently connected with Warner, Barnes & Co., Inc. - Iloilo Office.chanroblesvirtualawlibrary chanrobles virtual law library

2. That I joined Warner, Barnes in 1966 and rose from the rank of bookkeeper to Chief Accountant and to Finance Officer, the present position I am holding in a span of 14 years.chanroblesvirtualawlibrary chanrobles virtual law library

3. That I graduated from the University of the East in 1962 and had been working since I started college work.chanroblesvirtualawlibrary chanrobles virtual law library

4. That my present salary is P2,408.00 per month.chanroblesvirtualawlibrary chanrobles virtual law library

5. That my fringe benefits are as follows:

a. Provided with company car chanrobles virtual law library

b. No limit in gasoline chanrobles virtual law library

c. No limit in repair expenses chanrobles virtual law library

d. Free medical dental hospitalization, medicines without station.chanroblesvirtualawlibrarychanrobles virtual law library

e. That I am a practicing CPA with monthly retainer's fees of P350.00.chanroblesvirtualawlibrary chanrobles virtual law library

f. That I hold unofficially the position of No. 2 man in the Branch and such is a signatory on all checks.chanroblesvirtualawlibrary chanrobles virtual law library

g. That I have never been involved in any acts of dishonesty or disloyalty to the company in my fourteen (14) years of work chanrobles virtual law library

h. That they are free to make inquiries with Warner, Barnes as to the validity of the information I am giving him.

In March 1980, Mr. Cisneros followed up his offer and this time in a more official manner with the following benefits.chanroblesvirtualawlibrary chanrobles virtual law library

1. That I will be hired on a regular basis, not passing thru the probationary period since I more than qualify for the position chanrobles virtual law library

2. My monthly basic pay is P3,000.00.chanroblesvirtualawlibrary chanrobles virtual law library

3. My entertainment allowance is P1,000.00 chanrobles virtual law library

4. Free car with unlimited gasoline and repair expenses chanrobles virtual law library

5. That I will also have free hospitalization, dental, medical and medicines without limit chanrobles virtual law library

6. That aside from the usual 13th month pay, I will also get a 1% share on the net profit of the Branch at the end of a 12-month operation. The Branch is averaging P600,000.00 as its net profit for a 12-month operation or at least P5,000.00 a month chanrobles virtual law library

7. That I can only be terminated if in case I become grossly incompetent and dishonest

With all these agreements and benefits, I accepted the offer and forsook my 14 years service with Warner, Barnes & Co., Inc.

xxx xxx xxxchanrobles virtual law library

In April 1, 1980, I started working as Branch Manager of Grand Motor Parts Corporation and also of Grand Tire Recapping Plant, Iloilo Offices.chanroblesvirtualawlibrary chanrobles virtual law library

In April 22, 1980, I had a serious miss understanding with Mr. Benito Uy. I was blamed for a misdemeanor by a probationary salesman and for which I was not aware nor told about it. Since, I believed that I was judged rashly, I called Mr. Cisneros in Cebu and told him that I am leaving the company since I have now misgiving concerning management's maturity and intelligence in handling problems. But, he asked me to stay on since he will settle things with Mr. Uy in Bacolod. Since, I do not want to put Mr. Cisneros, the company in a bad light I stayed but intent or, resigning upon Mr. Cisneros's arrival from Bacolod. Mr. Cisneros arrived on April 26, 1980 and told me that Mr. Uy understood the whole situation and I must understand the characters of my superiors. He prevailed me to stay on. He fired the erring salesman because the company would rather fire the salesman than lose me since it is hard to look for professional men. To show his sincerity, he followed me home. There, he tell MY wife that she should not feel insecure since I am now working with a very stable and fraternal company. That, again, I will never be terminated unless I am highly incompetent and dishonest. So, I stayed on.chanroblesvirtualawlibrary chanrobles virtual law library

xxx xxx xxxchanrobles virtual law library

On August 18, 1980, after Mr. N. Garcia and company left Iloilo, I was relieved of some of my rights and privileges as Branch Manager of GMPC and GTRC Iloilo Offices, Mr. A. Cisneros executed these relief.chanroblesvirtualawlibrary chanrobles virtual law library

On August 31, 1980 came the letter of termination signed by Mr. Alfredo Cisneros, now the Personel Manager. It was not signed chanrobles virtual law library

xxx xxx xxx

On the other hand, the position paper submitted by the Grand Motor Parts Corporation through counsel, states the following:

There were several persons who applied as manager, including the complainant herein. Mr. Cisneros chose the complainant to take over the Iloilo Branch, subject to certain terms and conditions as herein discussed.chanroblesvirtualawlibrary chanrobles virtual law library

The respondent is aware that complainant in his fourteen years of service with Warner Barnes and being a Certified Public Accountant failed to get a promotion to the rank of Manager.chanroblesvirtualawlibrary chanrobles virtual law library

As a measure of protection, considering the responsibility and the amount of the investments attached to the job, the respondent gave the complainant a 4 to 6 months probation or observation period. This period of time was expressly agreed upon by the complainant and Fred Cisneros to determine the standard of complainant's managerial ability, competency and excellence. It was spelled out to the complainant that he may not qualify for the job based on his performance during the 4 to 6 months period running the risk of not being able to qualify for the job and lose employment in the process. Mr. Cisneros clarified to the complainant that if within the observation or probation period he failed to qualify as branch -manager he will be refused final appointment and the respondent will be forced to terminate him. It was precisely for this reason that committed complainant could not produce any written appointment because the permanency of his position is still to be determined by the respondent corporation after the lapse of the six months probationary period.chanroblesvirtualawlibrary chanrobles virtual law library

As a matter of fact, complainant as of April 1980 has not yet resigned from Warner Barnes hoping that in the event of his disqualification from the respondent, he will have an opportunity to return to his job at Warner Barnes, as Accountant or Finance Officer.chanroblesvirtualawlibrary chanrobles virtual law library

Within the said probation period, Fred Cisneros was the one who charge in the supervision of the complainant's performance. Mr. Cisneros has to stay in Iloilo to give management advice to the complainant, insuring that proper managerial policies are laid down.chanroblesvirtualawlibrary chanrobles virtual law library

II. Incidents after April 1, 1980.

A. Sometime in the month of May, 1980, a salesman of the respondent named Hernaldo Porquez figured in a vehicular collision causing damage to the respondent's delivery 'pick-up' vehicle. This incident was brought to the attention of the Cebu main office through the cashier of the Iloilo Branch three days after the incident. The incident has cause damage to the respondent corporation assess to more than Two Thousand Pesos (P2,000.00).chanroblesvirtualawlibrary chanrobles virtual law library

When Benito Uy, a member of the Board of Directors and Treasurer of the said respondent corporation, inquired from the complainant as to the details of the vehicular incident and the remedy or measures taken by the Iloilo Branch, the complainant claimed lack of knowledge about the incident. The complainant likewise failed to promptly provide administrative discipline to the erring employee.chanroblesvirtualawlibrary chanrobles virtual law library

The posture of ignorance adopted by the complainant has shocked the Cebu head office. For a manager ignorant of what happened to the activities of his erring personnels causing damage to the property of the company place the business operation of the company in grave jeopardy.chanroblesvirtualawlibrary chanrobles virtual law library

On account of this incident, the complainant was reprimanded by the Cebu Head Office and Fred Cisneros has to go back to Iloilo to enable the complainant manage the Iloilo Branch satisfactory to the head office. As noted, this incident occurred during the observation period as previously mentioned.chanroblesvirtualawlibrary chanrobles virtual law library

III. Complainant's resignation with Warner Barnes:

Even as of May, 1980 while complainant was then performing his duties as Branch Manager, he was still connected with Warner Barnes where he was employed as some sort of Accountant or Finance Officer. He informed Mr. Cisneros that just in case he could not qualify he will go back to Warner Barnes. Unfortunately, Warner Barnes pressed the complainant to you decide whether he Will stay with Warner Barnes or to resign and join the respondent corporation. Thus facing the risk of not being qualified he chose to stay with the respondent. After ala the benefits and privileges that he enjoys is much better than that of Warner Barnes.chanroblesvirtualawlibrary chanrobles virtual law library

With that decision, the complainant tendered his resignation with Warner Barnes, willing to assume the risk in connection with his new job as manager.chanroblesvirtualawlibrary chanrobles virtual law library

IV. Complainant repeatedly failed to follow company policies and instructions from Head Office.

In the course of complainant's operation, he was required to submit promptly a monthly Income or loss Statement and Comparative Projection and Actual Sales Report, The prompt submission of these reports are mandatory considering that his performance should be closely monitored while under probation.chanroblesvirtualawlibrary chanrobles virtual law library

These two reports were not submitted promptly to the Head Office of respondent Corporation, to the extent that on several occasions, he was warned of his apparent neglect and inability to comply with this basic instructions. Considering his lack of managerial experience, the respondents could not yet afford to leave everything to the complainant the Iloilo Branch without the closest supervision on his managerial ability.chanroblesvirtualawlibrary chanrobles virtual law library

Inspite of series of reminders to prepare and submit the said documents, he miserably failed to submit the same. Finally he was called by Nemesio Garcia, the President of the respondent corporation, to come to the head office in Cebu in order to evaluate his performance and to produce the latest monthly Income and Loss Statement and Comparative Projection and Actual Sales Report. He was likewise instructed to bring with him the Iloilo Branch Accountant, who will provide the basic information on the operation of the Iloilo Branch. He was specifically informed by Mr. Cisneros that he win be ready to present facts relative to average monthly expenditures, sales, collection, account receivables, minimum and maximum inventory and all other matters related to the operation of the Iloilo Branch.chanroblesvirtualawlibrary chanrobles virtual law library

The meeting took place in the presence of the President and two Vice-President. When complainant was asked basic information about company operations of the Iloilo Branch, the complainant failed to provide accurate and necessary answers and could not produce the necessary data available. The President and two Vice-President were so disappointed that they walked out of the conference. Mr. Cisneros was then called up and he was made to explain to the President why the complainant selected as probable manager could not provide basic information as to the operation of Iloilo Branch, inspite of his stature as Certified Publish Accountant.chanroblesvirtualawlibrary chanrobles virtual law library

The President and the members of the Board of Directors began to feel apprehensive that they are taking big risk in entrusting a multi-million peso investment to a man who could not comply simple routinary information vital to management.chanroblesvirtualawlibrary chanrobles virtual law library

Again in August, 1980, when the President and the Vice-President went to Iloilo in an inspection trip, supervising the operation of the Iloilo Branch, the complainant could not present the business condition of the Iloilo Branch. Information sought by the President such as Sales, Cash and Charges Collection, Budgeted and Actual Sales, Projection, Accounts Receivables could hot be obtained and no datas to this effect were provided. Facts and reports were in disarray.chanroblesvirtualawlibrary chanrobles virtual law library

V. The Performance of the Complainant.

In the Comparative Performance Report dated July 8, 1980, on the operation of Iloilo Branch for the month of June and May, 1980, the cash sales of the Iloilo Branch went down to P91,318.41 for June, 1980 as compared to the sales for the month of May, 1980 in the sum of P174,697.77. The lowering of the sales could have been averted had the necessary reports been submitted on time to assess the performance of the complainant. This sudden dip in the sales of the Iloilo Branch was not properly explained by the complainant.chanroblesvirtualawlibrary chanrobles virtual law library

Extension of personal accounts, were committed by the complainant in blatant violation of company policy. lt was repeatedly stressed to the complainant that no personal accounts will be extended by the Iloilo Branch unless served with clearance from the Head Office in Cebu, considering the unpaid collections accumulated by the former manager of the Iloilo Branch.chanroblesvirtualawlibrary chanrobles virtual law library

The personal accounts extended by the complainant were as follows: chanrobles virtual law library

(List omitted.) chanrobles virtual law library

As of November 6, 1980, these personal accounts extended by the complainant produce delinquent accounts amounting to P18,435.80.

Subsequently attached to the above position paper of the Grand Motor Parts Corporation is the letter of termination addressed to the complainant Branch Manager which reads:

25 August 1980 chanrobles virtual law library

Mr. Narciso Belicena, Jr.
Grand Motor Parts Corporation
Iloilo City chanrobles virtual law library

Dear Nonong: chanrobles virtual law library

When you applied for the position of Branch Manager, our understanding was clear that you will be on provision (sic) for a period of between four to six months, within which, you may quit with either verbal or formal notice if you should not desire to continue.chanroblesvirtualawlibrary chanrobles virtual law library

Likewise, the Management reserves the right to terminate your services, if, upon observation., the same is not satisfactory. It was emphasized that you were taking the risk of possibly losing your job.chanroblesvirtualawlibrary chanrobles virtual law library

Management's observation indicate that you do not qualify for the position. It is with regret that based on our agreement upon employment, we have to terminate your services effective immediately.chanroblesvirtualawlibrary chanrobles virtual law library

Upon receipt of this formal notice, kindly turn over to Mr. Sammy Gang the Iloilo Branch.

Very truly yours, chanrobles virtual law library

GRAND MOTOR PARTS CORPORATION chanrobles virtual law library

SGD.) FRED CISNEROS
Personnel Manager

On November 13, 1980, complainant Branch Manager filed his answers to the position paper of the corporation, reiterating that he was hired as Branch Manager but not on an acting capacity and on the terms and conditions recited in his original position paper; that his resignation from Warner Barnes took effect on May 1, 1980 and he started working with Grand Motor Parts Corporation on April 1, 1980 as he was on a 30-day vacation/sick leave from Warner; that the mishap involving the company's vehicle which was used without his permission and knowledge could not be blamed upon him; that the alleged reports which he failed to send were not reminded to him, verbally or in writing; that his sales for the period April to August, 1980 is higher compared to that for the same period in 1979; that the alleged accounts remaining unpaid as of November 6, 1980 would have been collected in full if he were still the Manager; that if ever there was no written contract on his employment on a regular basis, it was because he was now a regular employee and contracts are given only to those who will pass the probationary period and the rank-and-file employees, not to those managerial ones.chanroblesvirtualawlibrary chanrobles virtual law library

He further stated and We quote: "I trusted management, Besides, if I will pass through the probationary period, I will reject the offer. Furthermore, I was employed, very secure and happy in my job when Mr. Cisneros offered me the job. I had a very nice, comfortable, secure and well-paying job at Warner, Barnes and enjoying certain privileges and fringe benefits which other companies in Iloilo City does not offer. Mr. Fred Cisneros 'pirated' me from Warner, Barnes. ..." chanrobles virtual law library

To further support his stand, Belicena submitted: (1) Letter of Warner, Barnes & Co., Inc. dated April 28, 1-980 accepting his resignation effective May 1, 1980; (2) Letter of transmittal dated August 19, 1980 of all the reports as discussed thoroughly with Mr. Fred Cisneros on August 18, 1980; (3) Letter of April 29, 1980 requesting for written instructions. This was not answered; (4) Letter of July 7, 1980 from head office addressing him as Manager; (5) Certification from BF Goodrich, Bacolod City; and (6) Profit and Loss Statement of Grand Motor Parts Corp. for the period April to June, 1980 showing net profit of 11196,267.85 for three months operation of P65,422.63 per month.chanroblesvirtualawlibrary chanrobles virtual law library

As earlier indicated, the Regional Director, Nazareno Q. Bedia, ruled in favor of the Branch Manager, ordering his reinstatement to his former position with backwages without loss of seniority rights, benefits and other privileges under existing laws, decrees and agreements, verbal or written, entered into by the parties at the time of hiring. He held that "(f)rom the quantum of evidence, We are of the opinion, and so hold that complainant's appointment was permanent in nature. Complaint was 'pirated' so to speak. He was persuaded to leave his position as the No. 2 official of Warner, Barnes Co., Inc., Iloilo Branch, where he has already served for 14 years. For complainant to leave an already lucrative position for another job which is not permanent would be highly incomprehensible. The argument by respondent that complainant was motivated by the fact that he wants to be No. I in the office is pure conjecture. Complainant rose from the ranks to the No. 2 position. It is safe to assume that in the ordinary course of events he would rise to the No. 1 position in the office where he was employed." chanrobles virtual law library

On the issue whether complainant was dismissed for cause or not, the Regional Director held that there were no such acts or omissions committed or omitted by the complainant as charged by the corporation; that the assertion of respondent corporation that complainant could not prepare the financial reports promptly is unbelievable considering that complainant is a financial officer of a marketing firm, Warner Barnes & Co., inc.; that as regards his sales performance, complainant's assertion is explicit in that his sales for the period of his employment is bigger than the sales in the previous year covering the same period; that the alleged extension of credit against company policy is not backed up by even an iota of evidence since no policy, which was made known to complainant was presented; that complainant was not neglectful nor incompetent in respect to the wrong doing of a personnel of the Iloilo Branch who later tendered his resignation and the incident settled.chanroblesvirtualawlibrary chanrobles virtual law library

The Grand Motor Parts Corporation appealed the decision of the Regional Director to the Ministry of Labor and in his order dated October 22, 1981, the Deputy Minister, Vicente Leogardo, Jr., by authority of the Minister, affirmed the order appealed from and dismissed the appeal of the Corporation for lack of merit.chanroblesvirtualawlibrary chanrobles virtual law library

According to the Deputy Minister's order now under review, respondent's contention that complainant was hired on a temporary or probationary basis for a period of four to six months and as such, his services could be terminated anytime and that his dismissal on the main is premised on his failure to qualify for the job of manager and inability to manage the branch, "is without merit. The fact that complainant was enticed and pirated by respondent from the Warner Barnes Co., Inc. and given higher pay and benefits is an eloquent proof of respondent having recognized complainant's technical qualification and experience, which exempt him from the probationary provisions of the Labor Code. The grounds for dismiss cited by respondent are in the nature of generalizations and do not constitute justifiable causes which should be substantiated by proof of specific acts of managerial incompetence. Considering that complainant was hardly four months in the service, we are more inclined to believe that any shortcoming on his part perceived by the respondent was attributable to his newness on the job for which a reasonable time for orientation and adjustment must be permitted, considering the magnitude of his duties and responsibilities as Branch Manager." chanrobles virtual law library

Petitioner now comes to Us and assails the order of the Deputy Minister of Labor on the ground that:

I. The petitioner was denied due process when it was ordered to reinstate private respondent with backwages without hearing with opportunity to cross-examine and submit evidence on the basis merely of position papers, inspite of an agreement by the parties that summary investigation will be conducted thereafter; and chanrobles virtual law library

II. Grave abuse of discretion was committed against petitioner when it was ruled that private respondent cannot be dismissed during the period of probation and on the fifth month he was dismissed for failing to pass probation, and the Labor Minister admitted in his order that private respondent had shortcomings.

The more important and substantial issue that We must first resolve is whether private respondent's employment as Branch Manager was temporary or probationary, and not regular and permanent.chanroblesvirtualawlibrary chanrobles virtual law library

It is quite significant and very striking at the outset that Belicena, private respondent herein, did not and could not present any written proof of his appointment or employment as regular and permanent Branch Manager of petitioner corporation, which he assume as of April 1, 1980. It is admitted by him that it was only on April 28, 1980 that he resigned from his previous possition as Finance Officer of Warner, Barnes & Co., Inc. efective May 1, 1980, which fact lends strong support to the petitioner's contention that the hiring of Belicena was probationary for a period of four to six months. For otherwise, Belicena, if his appointment was regular and permanent as of April 1, 1980, would have resigned immediately from Warner, Barnes & Co. on April 1, 1980 because by then, he was assured of a permanent tenure. But he had to submit his resignation letter on April 28, 1980, hence, it is only logical and reasonable to conclude that before April 28, 1980, he was not yet sure of his status in the petitioner corporation, weather he would qualify for a job as Manager and thus be hired permanently, or not.chanroblesvirtualawlibrarychanrobles virtual law library

Private respondent's claim that if there was no recent contract on his employment on a regular basis, it was because he was now a regular employee and contract are given only to those who will pass the probationary period and the rank-and file employee, not to those Managerial ones, is not only unsupported by the evidence but also contrary to the usual and customarybusiness pratices, especially in multi-million enterprises as the petitioner corporation herein. And considering the magnitude of its sales and operation, petitioner corporation must have taken the necessary precautions to test the qualifications, ability and performance of its Branch Manager, but he did not. The conclusion is inevitable that his hiring was tempory.chanroblesvirtualawlibrarychanrobles virtual law library

We find merit in the contention of the petitioner that "private respondent has not been hired as manager of any firm before his employment with petitioner. The highest previous possition he attained was that of Finance Officer. His possition with petitioner's Iloilo Branch was his first as Manager. Moveover, Warner, Barnes & Co., private respondent privious employer, and petitioner are engaged in different kind of business. Managing petitioner's Iloilo Branch was entirely new experience for private respondent. It was, therefore, necessary for private respondent to undergo a period of probation to test his qualification, skill and experience." Indeed, the employer has the rigth or is at liberty to choose as to who will be hired and who will be decline. It is within the exercise of this rigth to select his employees that the employer may set or fix probationary period within which the latter may test and observed the conduct of the former before hiring him permanently. "The right of the laborer to sell his labor to such persons as he may choose is, in its essence, the same as the right of an employer to purchased labor from any person whom it chooses. The employer and the employee have thus an equality of rigths guaranteed by the Constitution. 'If the employer can compel the employer the employee to work against the latter's will, this is servitude. If the employee can compel the employer to give him work against the employer's will, this is oppression''' (Mills vs. United States Printing Co., 99 App. Div., 605; 91 N.Y.S. 185, 189-192, cited in Pampanga Bus Company, Inc. vs. Pambusco Employee' Union, Inc., 68 Phil. 541).chanroblesvirtualawlibrarychanrobles virtual law library

The finding of the regional Director and the Deputy Minister of Labor that private respondent was " pirated" is not supported by the evidence on record. On the contrary the records disclosed the Bilecena applied for the possition as branch Manager on March 18, 1980 as shown in his application marked Annex "F" to the petition pp. 41-43, rollo, P3,250.00. Even assuming that he was induced to work with the petitioner corporation, the inducement is a normal and legitimate pratice in business circles and concerned in the face in the stiff competition to net more sales and increase the market for their products.chanroblesvirtualawlibrary chanrobles virtual law library

The next issue to be resolved is weather private respondent, being a probationary Branch Manager, was terminated for just cause. It is petitioner's contention that Bilecena was terminated during his probationary Period because (a) he failed to submit promptly the monthly Income and Loss Statement, Comparative Projections & Actual Sales Report; (b) the Comparative Performance Report dated July 8, 1980 on the operation of the Iloilo Branch for the month of June and May, 1980, the Cash Sales of the Iloilo Branch went down to P91,318.41 for June, 1980, as compared with the sales for the month of May, 1980 in the sum of P174,697.77; (c) Belicena in violation of company policy and without clearance from the head office in Cebu, extended personal accounts in favor of 15 persons which as of November, 1980 produced delinquent accounts amounting to P18,435.80; and (d) Belicena claimed lack of knowledge of the vehicular accident caused by a subordinate and failed to provide prompt administrative disciplinary action against the erring employee.chanroblesvirtualawlibrary chanrobles virtual law library

The answers of Belicena to the above charges submitted in his position papers dated October 22, 1980 and November 13, 1980 hereinabove cited, indicate, to Our mind, inadequacy, if not inefficiency in the discharge of his duties as Branch Manager. His letter dated August 19, 1980 to the President of petitioner corporation enclosing (1) Actual Sales and Collection for GMPC from Jan.-July, 1980; (2) Cash and Charge Sales for GMPC from Jan.-JULY, 1980 compared to Budget; (3) GMPC - Financial Statement from January to June 1980; (4) GMPC Trial Balance as of June 30, 1980; (5) Monthly breakdown of our expenses from January to June 1980; (6) Our GTRC Report on actual sales and collection, January-July 1980; (7) Our GTRC report on Charge and Cash Sales as compared to Budget, clearly prove and demonstrate his failure to submit monthly reports. The reports submitted by him in the cited letter are for the seven months period of January to July, 1980. That a monthly report of operations is essential to the business of the petitioner cannot be evaded or ignored by a Branch Manager, for the viability of its business life may well depend on these monthly reports.chanroblesvirtualawlibrary chanrobles virtual law library

Again private respondent's letter-request dated April 29, 1980 requesting "a. My specific jobs and responsibilities and stations, as well; b. Our company's accounting policies and procedures and the monthly reports and deadlines; c. Our committed company's policies and procedures in the extension of CREDIT and approval of CREDIT LIMITS," simply shows that after being on the job as Branch Manager for nearly a month (he joined the corporation on April 1, 1980), Belicena has not shown any effort or initiative to familiarize himself with his duties and obligations, although petitioner corporation submits that a copy of the company brochure containing the re. requested data was given him (See Annex "I", pp. 106-131, rollo). Further, the fact that the erring salesman involved in the vehicular accident resigned afterwards does not absolve the Branch Manager for his failure to exercise supervision over his subordinates and to impose discipline over him. Neither can he escape responsibility for extending personal accounts to some 15 individuals in violation of a company policy by citing the letter of the Vice President/General Manager of petitioner corporation (Annex "K", rollo, p. 133) which refers to the corporate account of Asturias Sugar Central to the corporation.chanroblesvirtualawlibrary chanrobles virtual law library

The records further disclose that petitioner's Vice President/General Manager caned the attention of Branch Manager Belicena in his letter dated July 7, 1980 (Annex "K" to the petition, records, p. 133) that "(h)is June sales is only about 50% of our target. Can we not improve that performance this July?" This in effect proved that the Branch Manager was not discharging his duties to the satisfaction of the management.chanroblesvirtualawlibrary chanrobles virtual law library

In fine, from the documentary evidence on record, We hold that petitioner has clearly and convincingly established that the private respondent failed to pass the probationary period for the position of Branch Manager, and for lack of confidence, petitioner was justified in terminating or dismissing private respondent herein. As the respondent Deputy Minister of Labor has admittedly confirmed in the assailed Order, the 1 4 shortcoming on his (Belicena) was attributable to his newness on the job." chanrobles virtual law library

Recent decisions of this Court on the dismissal of managerial employees have laid down the doctrine that under Policy Instructions No. 8 of the Secretary of Labor "the employer is not required to obtain a previous written clearance to terminate managerial employees in order to enable him to manage effectively." (Associated Citizens Bank vs. Ople, L-48896, Feb. 24, 1981, cited in Bondoc vs. People, s Bank & Trust Company, 103 SCRA 599). In St. Luke's Hospital, Inc. vs. Minister of Labor, 116 SCRA 240, We held that "it looks to Us more practical and proper to leave things as they are instead of compelling petitioner to reinstate in a sensitive position one whose attitude could per chance spell not only more financial difficulties to petitioner but also possible inadequacies in the required dietary standards it has to maintain for its patients. Petitioner does not have to wait 'for one more serious act of insubordination and disrespect to express instructions of management - (which would warrant or) mean forfeiture of [her] right to employment with petitioner.' " chanrobles virtual law library

Under the law, Article 282 of the Labor Code, a probationary employee may be terminated after six months for a just cause or when he fails to qualify as a regular em employee, to p wit:

Art. 282. Probationary Employment. - Probationary employment shall not exceed six (6) months from the date the employee started working, unless it is covered by an apprenticeship agreement stipulating a longer period. The services of an employee who has been engaged on a probationary basis may be terminated for a just cause or when he fails to qualify as a regular employee at the time of his engagement. An employee who is allowed to work after a probationary period shall be considered a regular employee.

It is true that mere allegation of loss of confidence by employer on his employee is not sufficient cause for his dismissal. But loss of confidence is a valid ground for dismissing an employee, and proof beyond reasonable doubt of the employee's misconduct is not required to dismiss him of this charge. It is sufficient if there is some basis for such loss of confidence. (Central Textile Mills, Inc. vs. National Labor Relations Commission, 90 SCRA 9). While a managerial employee may be dismissed merely on the ground of loss of confidence, the matter of determining whether the cause for dismissing an employee is justified on ground of loss of confidence, cannot be left entirely to the employer. Impartial tribunals do not rely only on the statement made by the employer that there is "loss of confidence" unless duly proved or sufficiently substantiated. (De Leon vs. National Labor Relations Commission, 100 SCRA 691).chanroblesvirtualawlibrary chanrobles virtual law library

In the case at bar, We are satisfied that petitioner has valid grounds to charge its Branch Manager with loss of confidence by reason of the overall performance he has demonstrated within the probationary period which showed that he is not qualified to be the regular or permanent Branch Manager of petitioner corporation in Iloilo City. His dismissal does not appear to Us as arbitrary, fanciful or whimsical. In the last and ultimate analysis, the prerogative and judgment to hire employees under terms and conditions designed to achieve success in its business activities belongs to management which may not be unduly impaired, limited or restricted. We, therefore, rule that public respondents committed grave abuse of discretion in ordering the reinstatement of private respondent without substantial evidence in support thereof.chanroblesvirtualawlibrary chanrobles virtual law library

With the resolution of the issue under consideration in favor of the petitioner corporation, We deem it unnecessary to discuss and resolve the assailment of the petitioner that it was denied due process in the proceedings before the Regional Director.chanroblesvirtualawlibrary chanrobles virtual law library

WHEREFORE, IN VIEW OF ALL THE FOREGOING, the Order of the Deputy Minister of Labor dated October 22, 1981 is hereby REVERSED and SET ASIDE. No costs.chanroblesvirtualawlibrary chanrobles virtual law library

PETITION GRANTED.chanroblesvirtualawlibrary chanrobles virtual law library

SO ORDERED.

Makasiar (Chairman), Aquino, Concepcion, Jr., Abad Santos, Escolin and Cuevas JJ., concur.