DGT - Duncan Vs Glaxo Wellcome

Duncan Association Of DetailmanPtgwo and Pedro A. Tecson, VS.
Glaxo
Wellcome Philippines, Inc.
G.R. No. 162994 September 17, 2004
FACTS:
Tecson was hired by Glaxo as a medical representative on Oct. 24, 1995. Contract of
employment signed by Tecson stipulates, among others, that he agrees to study and
abide by the existing company rules; to disclose to management any existing future
relationship by consanguinity or affinity with co-employees or employees with competing
drug companies and should management find that such relationship poses a prossible
conflict of interest, to resign from the company. Company's Code of Employee Conduct
provides the same with stipulation that management may transfer the employee to
another department in a non-counterchecking position or preparation for employment
outside
of
the
company
after
6
months.
Tecson was initially assigned to market Glaxo's products in the Camarines SurCamarines Norte area and entered into a romantic relationship with Betsy, an employee
of Astra, Glaxo's competition.
Before getting married, Tecson's District Manager reminded him several times of the
conflict of interest but marriage took place in Sept. 1998. In Jan. 1999, Tecson's
superiors informed him of conflict of intrest. Tecson asked for time to comply with the
condition (that either he or Betsy resign from their respective positions). n August 1999,
Tecson again requested for more time resolve the problem. In September 1999, Tecson
applied for a transfer in Glaxos milk division, thinking that since Astra did not have a
milk division, the potential conflict of interest would be eliminated. His application was
denied in view of Glaxos "leastmovementpossible" policy. Unable to comply with
condition, Glaxo transferred Tecson to the Butuan-Surigao City-Agusan del Sur sales
area.
After his request against transfer was denied, Tecson brought the matter to Glaxo's
Grievance Committee and while pending, he continued to act as medical representative
in the Camarines Sur-Camarines Norte sales area and was paid his salary, but was not
issued samples of products which were competing with similar products manufactured
by Astra. He was also not included in product conferences regarding such products.
Because the parties failed to resolve the issue at the grievance machinery level, they
submitted the matter for voluntary arbitration. Glaxo offered Tecson a separation pay of
onehalf (12) month pay for every year of service, or a total of P50,000.00 but he
declined the offer. On November 15, 2000, the National Conciliation and Mediation
Board (NCMB) rendered its Decision declaring as valid Glaxos policy on relationships
between its employees and persons employed with competitor companies, and
affirming Glaxos right to transfer Tecson to another sales territory.
the Court of Appeals denied Tecsons Petition for Review on the ground that the NCMB
did not err in rendering its Decision. The appellate court held that Glaxos policy
prohibiting its employees from having personal relationships with employees of
competitor companies is a valid exercise of its management prerogatives
ISSUES:
1. Whether or not the Court of Appeals erred in ruling that Glaxos policy against its
employees marrying employees from competitor companies is valid, and in not
holding that said policy violates the equal protection clause of the Constitution.
2. Whether or not Tecson was constructively dismissed.
RULING:
1. On Equal Protection
NO. Glaxo has a right to guard its trade secrets, manufacturing formulas,
marketing strategies, and other confidential programs and information from
competitors. The prohibition against pesonal or marital relationships with
employees of competitor companies upon Glaxo's employees is reasonable
under the circumstances because relationships of that nature might compromise
the interests of the company. That Glaxo possesses the right to protect its
economic interest cannot be denied.
It is the settled principle that the commands of the equal protection clause are
addressed only to the state or those acting under color of its authority. Corollarily,
it has been held in a long array of US Supreme Court decisions that the equal
protection clause erects to shield against merely privately conduct, however,
discriminatory or wrongful.
In any event, from the wordings of the contractual provision and the policy in its
employee handbook, it is clear that Glaxo does not impose an absolute
prohibition against relationships between its employees and those of competitor
companies. Its employees are free to cultivate relationships with and marry
persons of their own choosing. What the company merely seeks to avoid is a
conflict of interest between the employee and the company that may arise out of
such relationships
Moreover, He is estopped from questioning said policy since the assailed
company policy which forms part of respondents Employee Code of Conduct
and of its contracts with its employees, such as that signed by Tescon, was made
known to him prior to his employment. Thus, he was aware of that restriction
when he signed his employment contract and when he entered into a relationship
with Bettsy.
The company actually enforced the policy after repeated requests to the
employee to comply with the policy. Indeed the application of the policy was
made in an impartial and even-handed manner, with due regard for the lot of the
employee.
2. On Constructive Dismissal
NO. Constructive dismissal is defined as a quitting, an involuntary resignation
resorted to when continued employment becomes impossible, unreasonable or
unlikely; when there is demotion in rank, or diminution in pay; or when a clear
discrimination, insensibility, or disdain by an employer becomes unbearable to
the employee. None of these conditions are present in the instant case.
The challenged policy has been implemented by Glaxo impartially and
disinterestedly for a long period of time. In the case at bar, the record shows that
Glaxo gave Tecson several chances to eliminate the conflict of interest brought
about by his relationship with Betsy, but he never availed of any of them.
the petition is DENIED for lack of merit.

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Duncan Association Of DetailmanPtgwo and Pedro A. Tecson, VS.

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