Labor Law

Philippine Long Distance Telephone Company vs National Labor Relations Commission (1988)

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G.R. No. 80609 – 247 Phil. 641 – 164 SCRA 671 – Labor Law – Post-Employment – Termination – Just and Authorized Causes – Separation Pay; When not available – Equity

Marilyn Abucay has been an employee of the Philippine Long Distance Telephone Company (PLDT) for ten years when it was discovered that she accepted “bribes” from certain customers in order to facilitate the phone connections of said customers. PLDT terminated her employment. A labor case was filed by Abucay. The National Labor Relations Commission (NLRC) found the dismissal to be valid but nevertheless, the NLRC ordered PLDT to pay Abucay separation pay equivalent to one month pay for every year of service.

PLDT assailed the said decision. PLDT averred that separation pay is only available in cases where the employee has been illegally dismissed and reinstatement is no longer possible. PLDT further argued that to award Abucay separation pay is tantamount to rewarding her misdeeds.

The Solicitor General, arguing for the NLRC, cited numerous previous cases where separation pay has been awarded by the Supreme Court even if the employee’s dismissal were due to just and authorized causes.

ISSUE: Whether or not Abucay is entitled to separation pay.

HELD: No. In this case, the Supreme Court finally set the rules as to when separation pay is proper in cases where the employee is dismissed for valid reasons.

As a rule, and under the Labor Code, a person dismissed for just and authorized causes is not entitled to separation pay. However, based on equity, an exception can be made if the employee is dismissed for causes other than serious misconduct or those reflecting on his moral character. Where the reason for the valid dismissal is, for example, habitual intoxication or an offense involving moral turpitude, like theft or illicit sexual relations with a fellow worker, the employer may not be required to give the dismissed employee separation pay, or financial assistance, or whatever other name it is called, on the ground of social justice.

In the case at bar, the reason for Abucay’s dismissal is due to her acceptance of a “bribe” which is dishonesty and is immoral. The fact that she has worked with the PLDT for more than a decade, if it is to be considered at all, should be taken against her as it reflects a regrettable lack of loyalty that she should have strengthened instead of betraying during all of her 10 years of service with the company. The court also emphasized:

Compassion for the poor is an imperative of every humane society but only when the recipient is not a rascal claiming an undeserved privilege. Social justice cannot be permitted to be refuge of scoundrels any more than can equity be an impediment to the punishment of the guilty. Those who invoke social justice may do so only if their hands are clean and their motives blameless and not simply because they happen to be poor.

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