General Milling Vs Viajar

General Milling Corporation vs. Violeta L.
Viajar
G.R. No. 181738, January 30, 2013
FACTS:
General Milling Corporation terminated the services of thirteen (13) of its employees
on the grounds of redundancy. Said company claims that they had been “gradually
downsizing its Visayas-Mindanao operations in Cebu which had been filled with a number of
redundant positions over a period of time. Violeta Viajar was hired as Invoicing Clerk by the
company in 1979, and thereafter held various positions. Viajar was among those thirteen
employees terminated from work. On October 30, 2003, the HRD Manager (Johhny
Almocera) informed Viajar, through a Letter-memorandum that the latter’s services are no
longer needed effective November 30, 2003. This is because her current position as
Purchasing Staff at the Purchasing group Cebu Operations was deemed redundant. When
Viajar reported for work the following day, the on-duty guard of the company barred her from
entering the office premises. Viajar was also denied access to her office computer and
resctricted from punching her DTR in the bundy clock. On November 7, 2003, she was
invited to the HRD Cebu Office where she was asked to sign an Application for Retirement
and Benefits. Almocer (HRD manager) told her that such was required in order to process
her separation pay.
Meanwhile, Viajar observed that between the period of July and October 2003,
General Milling hired fifteen (15) new employees. In lieu of the aforementioned events, Viajar
filed a case of illegal dismissal, with claims for damages and separation pay, against
General Milling. The GMC averred that (1) Viajar’s dismissal was due to redundancy of her
position and the economic setbacks the company is suffering at the moment, and that such
act is part of the company’s cost reduction measure; (2) GMC presented the required “
Establishment Termination Report” (involving the matter of employment termination of Viajar
and the other 13 employees) which it filed before the DOLE; and (3) that GMC issued two (2)
checks amounting to Php 440,253.02 and Php 21,211.35, respectively as Viajar’s separation
pay. The Labor Arbiter (LA) ruled that GMC is not liable, hence, dismissing the illegal
dismissal case. The NLRC likewise affirmed the LA’s decision, but with a modification
ordering GMC to give Viajar separation pay. Viajar appealed to the Court of Appeals. CA
reversed the decision of the NLRC. Aggrieved by the CA decision, GMC petitioned before
the Honorable Supreme Court.
ISSUE:
Whether or not Viajar was validly terminated from General Milling Corporation.
RULING:
No, the court held that the company failed to show the basis of redundancy. To
exhibit good faith and that there was a reasonable criteria in ascertaining redundant
positions, a company claiming to be over manned must produce proof.
Article 283 of the Labor Code provides that redundancy is one of the authorized
causes for dismissal. It is imperative that the employer must comply with the requirements
for a valid implementation of the company’s redundancy program, to wit: (a) the employer
must serve a written notice to the affected employees and the DOLE at least one (1) month
before the intended date of retrenchment; (b) the employer must pay the employees a
separation pay equivalent to at least one month pay or at least one month pay for every year
of service, whichever is higher; (c) the employer must abolish the redundant positions in
good faith; and (d) the employer must set fair and reasonable criteria in ascertaining which
positions are redundant and may be abolished.
While it is true that the "characterization of an employee’s services as superfluous or
no longer necessary and, therefore, properly terminable, is an exercise of business judgment
on the part of the employer,the exercise of such judgment, however, must not be in violation
of the law, and must not be arbitrary or malicious. The Court has always stressed that a
company cannot simply declare redundancy without basis. To exhibit its good faith and that
there was a fair and reasonable criteria in ascertaining redundant positions, a company
claiming to be over manned must produce adequate proof of the same.

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