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[G.R. NO. 167716 : March 23, 2006]




This Petition for Review on Certiorari under Rule 45 of the Rules of Court seeks to annul and set aside the Decision of the Court of Appeals in CA-G.R. SP No. 80975 dated January 17, 20051 and its Resolution dated April 7, 20052 holding the petitioner Premiere Development Bank liable for illegal suspension and illegal dismissal, ordering it to reinstate respondent Elsie Escudero Mantal to her former position and to pay her full backwages from date of suspension and dismissal until actual reinstatement, half month salary and half month 13th month pay, as well as attorney's fees.

Respondent is a regular employee of petitioner's Cubao branch, serving as accounting clerk since July 17, 1996.3 On November 24, 2000, the branch manager, Rosario Detalla, instructed respondent with the following words in the vernacular, "Elsie, baka may mag-confirm sa Bank Guarantee ng GIA Fuel, sabihin mo OKAY NA, may kulang pa lang dokumento."4

Later that day, Emmie Crisostomo of Filpride Energy Corporation inquired whether GIA Fuel and Lubricant Dealer has a credit line or maintains an account with petitioner Bank which respondent confirmed after checking the files on the computer. Crisostomo also inquired if the bank guarantee signed by Detalla is in order, and likewise respondent replied in the affirmative. However, upon verification from petitioner's head office, Crisostomo was informed that the bank guarantee was spurious.

On the same day, respondent was summoned to the head office and was required to write down what she knew about the subject bank guarantee. Respondent also received a memorandum placing her under preventive suspension effective immediately for a period of 30 days. During the investigation, Detalla admitted issuing the falsified bank guarantee.

On December 21, 2000, Detalla tendered her irrevocable letter of resignation.5 Respondent was asked to execute a resignation letter on December 22, 2000, but she declined.6 The following day, respondent received a Notice of Termination dated December 22, 2000.7

Respondent filed a complaint for illegal suspension, illegal dismissal, unpaid salary and 13th month pay, moral and exemplary damages.

On September 4, 2002, the Labor Arbiter8 rendered a decision9 holding petitioner liable for illegal suspension and illegal dismissal and ordering the reinstatement of respondent to her former position, with full backwages, half month salary and half month 13th month pay, and attorney's fees.10

The National Labor Relations Commission (NLRC) reversed the labor arbiter's decision, and dismissed the complaint for lack of merit.11 The motion for reconsideration having been denied,12 respondent appealed to the Court of Appeals which found that petitioner failed to prove that respondent conspired with Detalla in issuing the falsified bank guarantee;13 that the alleged infraction of respondent was not related to her functions as encoder and accounts clerk, hence her dismissal could not be based on loss of trust and confidence, the breach of which must be related to the performance of the employee's functions;14 that respondent was not negligent in the performance of her functions inasmuch as she verified from the computer before answering the queries by Crisostomo;15 that the alleged negligence was not gross or habitual;16 that respondent merely conveyed the instructions of her immediate superior which appeared to be lawful and regular.17

The dispositive portion of the decision reads:

IN LIGHT OF THE FOREGOING, the petition is hereby GRANTED. The Decision dated 30 May 2003 of the public respondent NLRC reversing the Decision of the Labor Arbiter and its Resolution dated 30 September 2003 denying petitioner's motion for reconsideration are REVERSED and SET ASIDE. The Decision dated 4 September 2002 of Labor Arbiter Ariel Cadiente Santos is REINSTATED.


The sole issue in the instant petition is whether respondent was validly suspended and dismissed from her position as accounting clerk.

Petitioner contends that respondent was validly dismissed because she was grossly negligent in the performance of her functions which caused petitioner to lose trust and confidence in her. It argues that respondent is guilty of misconduct for her failure to report the irregularity to the management.

The petition lacks merit.

Gross negligence means an absence of that diligence that a reasonably prudent man would use in his own affairs. To constitute a just cause for termination of employment, the neglect of duties must not only be gross but habitual as well. The single or isolated act of negligence does not constitute a just cause for the dismissal of the employee.

In JGB and Associates, Inc. v. National Labor Relations Commission,19 we held that gross negligence connotes want of care in the performance of one's duties. Habitual neglect implies repeated failure to perform one's duties for a period of time, depending upon the circumstances. Fraud and willful neglect of duties imply bad faith of the employee in failing to perform his job to the detriment of the employer and the latter's business.20

On the other hand, misconduct is improper or wrongful conduct. It is the transgression of some established and definite rule of action, a forbidden act, a dereliction of duty, willful in character, and implies wrongful intent and not mere error in judgment. Under Article 282 of the Labor Code, the misconduct, to be a just cause for termination, must be of such grave and aggravated character, not merely of a trivial or unimportant nature. For serious misconduct to warrant the dismissal of an employee, it (1) must be serious; (2) must relate to the performance of the employee's duty; and (3) must show that the employee has become unfit to continue working for the employer.21

In the case at bar, respondent cannot be held liable for serious misconduct or gross negligence. No independent evidence was presented to prove her "willful conspiracy" with Detalla. Petitioner even admitted that there is no direct evidence that respondent benefited from the falsified bank guarantee. Liability for the incident lay solely with Detalla, who patently breached the trust and confidence of petitioner. Respondent merely followed the orders of the bank manager which appeared to be regular. Furthermore, the nature of respondent's job does not include processing of bank loans and guarantees. Her work as accounting clerk refers only to the opening of deposits and processing of withdrawals. The alleged infraction was not within the scope of her job function. Petitioner did not contest this fact.

Respondent also verified from the bank computer whether GIA Fuel and Lubricant Dealer had an account with petitioner, as can be gleaned from her statements in the Question and Answer22 conducted by the bank, to wit:

Tanong 1. Noong Nov. 24, 2000 nga bandang 2: o 2:30 na hapon. Nasaan ka noon.

Sagot 1. Nasa Cubao branch po at ginagawa ang aking trabaho bilang encoder. Nagring po ang telepono at aking sinagot ng ganito "Hello, Premiere Bank may I help you?" at nagpakilala ang nasa kabilang linya na siya daw si Ms. Emmie Crisostomo from Philpride at sabi ay "I ve-verify ko lang kung may account dyan si GIA fuel." Ang sagot ko ay meron.

Tanong 2. Paano mo nasabi na meron?cralawlibrary

Sagot 2. Pumunta po ako sa computer at nag search ako sa file at nakita ko na may GIA fuel account at bumalik ako at (sic) telepono at sinabi ko sa kanya na meron.

Tanong 3. Mga ilang minuto mo ibinaba ang telepono para tingnan sa computer ang GIA fuel account?cralawlibrary

Sagot 3. Mga 1 minuto dahil madali lang naman ang mag search sa computer.

Elsie Mantal: Sabi ni Ms. Crisostomo na may ini-issue na Bank guarantee na pinirmahan ni Ms. Rosario Detalla, okey ba ito? Naalala ko ang ipinagbilin sa akin ng Boss ko, na si Ms. Rosario Detalla sabi nya "Na baka may magverify kay GIA fuel sabihin mo na okay yan. Pero may kulang pang dokumento.

Tanong 4. Ano ba ang Bank guarantee na sabi mo ay okay?cralawlibrary

Sagot 4. Hindi ko alam kung anong nilalaman nyan.

Tanong 5. Pero bakit ka nag okay, e wala ka palang alam dyan.

Sagot 5. E kasi nga sabi ng Boss ko na si Ms. Detalla na okay yan, kaya ng may magverify ang sabi ko ay okay. Hindi ko na man matanong ang Boss ko, dahil nakaalis na siya.

x x x x. (Emphasis supplied)cralawlibrary

Respondent did what was expected of her as an employee of the bank. Before answering the telephone inquiry, respondent verified the existence of the GIA Fuel and Lubricant Dealer account through the bank computer. If ever she was negligent, it would only constitute a single or isolated act which is not a just cause for the dismissal of the respondent from her employment.

In addition, although respondent's position as accounting clerk involves a high degree of responsibility requiring trust and confidence, carrying with it the duty to observe proper company procedures in the fulfillment of her job as it relates closely to the financial interests of the company,23 the charge against her is not reasonably connected to her job of opening of savings, current and/or time deposits and the payment of withdrawals. The duty and ultimately, the responsibility of approving transactions relating to bank guarantees lie with the branch manager and the management personnel of the petitioner's head office. Thus, in Metropolitan Bank and Trust Company v. Barrientos,24 the Court held that respondent therein was not liable of misconduct for allowing the opening of fictitious accounts, because he was merely a cashier and had no authority to approve new accounts and had no way of knowing the anomalous transactions.

An employer may terminate an employee for fraud or willful breach by the employee of the trust reposed in him by his employer or duly authorized representative. However, the right of an employer to terminate an employee based on loss of confidence must not be exercised arbitrarily and without just cause. To be a valid reason for dismissal, loss of confidence must be genuine. Uncorroborated assertions and accusations by the employer will not suffice, otherwise it will jeopardize the constitutional guarantee of security of tenure of the employee.25

Under Article 279 of the Labor Code, an employee who is unjustly dismissed from work shall be entitled to reinstatement without loss of seniority rights and other privileges, inclusive of allowances, and other benefits or their monetary equivalent from the time the compensation was withheld up to the time of actual reinstatement. In addition, recovery of attorney's fees is reasonable under the circumstances. It is settled that in actions for recovery of wages or where an employee was forced to litigate and incur expenses to protect his rights and interest, he is entitled to an award of attorney's fees.26

WHEREFORE, the petition is DENIED. The Decision of the Court of Appeals in CA-G.R. SP No. 80975 dated January 17, 2005 finding petitioner guilty of illegal dismissal and ordering the reinstatement of respondent to her former position, with full backwages, inclusive of allowances and to the other benefits or their monetary equivalent from the time her compensation was withheld up to her actual reinstatement, plus attorney's fees, and the Resolution dated April 7, 2005 denying the motion for reconsideration, are AFFIRMED.



1 Rollo, pp. 32-46. Penned by Associate Justice Japar B. Dimaampao and concurred in by Associate Justices Renato C. Dacudao and Edgardo F. Sundiam.

2 Id. at 48-49.

3 Id. at 33.

4 Id.

5 Id. at 93.

6 Id at 33.

7 Id. at 33-34.

8 Ariel Cadiente Santos.

9 Rollo, pp. 99-106.

10 Id. at 105-106.

11 Id. at 109-117. Decision was penned by Commissioner Victoriano R. Calaycay and concurred in by Presiding Commissioner Raul T. Aquino.

12 Id. at 118-119. Decision was penned by Commissioner Victoriano R. Calaycay and concurred in by Presiding Commissioner Raul T. Aquino and Commissioner Angelita A. Gacutan.

13 Id. at 40.

14 Id. at 40-41.

15 Id. at 42.

16 Id.

17 Id. at 43.

18 Id. at 45.

19 324 Phil. 747 (1996).

20 Id. at 754.

21 Roquero v. Philippine Airlines, Inc., 449 Phil. 437, 443-444 (2003).

22 Rollo, p. 96.

23 Kwikway Engineering Works v. National Labor Relations Commission, G.R. No. 85014, March 22, 1991, 195 SCRA 526, 530.

24 G.R. No. 157028, January 31, 2006.

25 Philippine Military Veterans Security and Investigation Agency v. Court of Appeals, G.R. No. 139159, January 31, 2006.

26 Mayon Hotel & Restaurant v. Adana, G.R. No. 157634, May 16, 2005, 458 SCRA 609, 650. See Philippine Military Veterans Security and Investigation Agency v. Court of Appeals, supra.

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