1.

St Scholastica’s College Westgrove was In resolving the foregoing question,the Court

declared guilty of illegal dismissal for will assess the matter from a strictly neutral
terminating a female non-teaching and secular point of view – the relationship
personnel for having been pregnant between SSCW as employer and the petitioner
without benefit of prior marriage. She was as an employee, the causes provided for by
awarded separation pay in lieu of actual law in the termination of suchrelationship, and
reinstatement, full backwages, attorney’s the evidence on record. The ground cited for
fees, and 10% monetary award. The SC the petitioner’s dismissal, i.e., pre-marital
ruled that the dismissal is not a valid sexual relations and, consequently, pregnancy
exercise of management prerogative. outof wedlock, will be assessed as to whether
the same constitutes a valid ground for
The Court has held that "management is dismissal pursuant to Section 94(e) of the
free to regulate, according to its own 1992 MRPS.
discretion and judgment, all aspects of
employment, including hiring, work 4. 2 Kinds of Immorality
assignments, working methods, time, place 5. Two Steps in Determining What is a
and manner of work, processes to be disgraceful and immoral conduct is.
followed, supervision of workers, working
regulations, transfer of employees, work 6. Cases that should be filed before the:
supervision, lay off of workers and • LABOR ARBITER
discipline, dismissal and recall of workers. • Unfair labor practice (ULP) cases;

The exercise of management prerogative, 2. Termination disputes (or illegal dismissal
however, is not absolute as it must • cases);

beexercised in good faith and with due 3. If accompanied with a claim for
regard to the rights of labor." Management • reinstatement, those cases that workers
cannot exercise its prerogative in a cruel, may file involving wages, rates of pay,
repressive, or despotic manner. hours of work and other terms and
conditions of employment;
The Court finds that the petitioner was • 4. Claims for actual, moral, exemplary and
illegally dismissed as there was no just other forms of damages arising from
cause for the termination of her employer- employee relations;
employment. SSCW failed to adduce • 5. Cases arising from any violation of
substantial evidence to establish that the Article 264 of the Labor Code, including
petitioner’s conduct, i.e., engaging in pre- questions involving the legality of strikes
marital sexual relations and conceiving a and lockouts;
child out of wedlock, assessed in light of • 6. Except claims for employees
the prevailing norms of conduct, is compensation not included in the next
considered disgraceful or immoral. succeeding paragraph, social security,
medicare and maternity benefits, all other
2. Immorality, as a general rule, is not a just claims arising from employer-employee
ground to terminate employment. The relations, including those of persons in
exception is when such immoral conduct is domestic or household service, involving
prejudicial or detrimental to the interest of an amount exceeding Five Thousand
the employer. Pregnancy without marriage Pesos (P5,000.00), whether or not
does not affect her work… blah blah accompanied with a claim for
reinstatement;
3. Labor Code governs over Manual of • 7. Wage distortion disputes in unorganized
Regulations in Private Schools. It is thus establishments not voluntarily settled by
within the authority of the Secretary of the parties pursuant to Republic Act No.
Education to issue a rule, which provides 6627;
for the dismissal of teaching and non- • 8. Enforcement of compromise
teaching personnel of private schools agreements when there is non-compliance
based on their incompetence, inefficiency, by any of the parties pursuant to Article
or some other disqualification. 227 of the Labor Code, as amended;
• 9. Money claims arising out of employer-
employee relationship or by virtue of any
 law or contract, involving Filipino workers finding by the DOLE that there is an
for overseas employment, including claims existing employer-employee relationship,
for actual, moral, exemplary and other the DOLE exercises jurisdiction to the
forms of damages as provided by Section exclusion of the NLRC.
10 of R.A. No. 8042, as amended by R.A. • If the DOLE finds that there is no
No. 10022; employer-employee relationship, the
• 10. Contested cases under the exception jurisdiction is properly with the NLRC. If a
clause of Article 128(b) of the Labor Code, complaint is filed with the DOLE, and it is
as amended by R.A. 7730; and accompanied by a claim for reinstatement,
• 11. Other cases as may be provided by the jurisdiction is properly with the Labor
law. Arbiter, under Art. 217(3) of the Labor
Code, which provides that the Labor
GRIEVANCE MACHINERY Arbiter has original and exclusive
• The Voluntary Arbitrator or panel of jurisdiction over those cases involving
Voluntary Arbitrators shall have original wages, rates of pay, hours of work, and
and exclusive jurisdiction to hear and other terms and conditions of employment,
decide all unresolved grievances arising if accompanied by a claim for
from the interpretation or implementation of reinstatement.  If a complaint is filed with
the Collective Bargaining Agreement and the NLRC, and there is still an existing
those arising from the interpretation or employer-employee relationship, the
enforcement of company personnel jurisdiction is properly with the DOLE.  The
policies referred to in the immediately findings of the DOLE, however, may still be
preceding article. Accordingly, violations of questioned through a petition for certiorari
a Collective Bargaining Agreement, except under Rule 65 of the Rules of Court.
those which are gross in character, shall
no longer be treated as unfair labor DOLE REGIONAL DIRECTOR
practice and shall be resolved as • Under Article 129 of the Labor Code,
grievances under the Collective Bargaining DOLE Regional Directors or the duly
Agreement. For purposes of this article, a u t h o r i z e d h e a r i n g o f fi c e r s , a r e
gross violations of Collective Bargaining empowered, in a summary proceeding, to
Agreement shall mean flagrant and/or hear and decide claims for recovery of
malicious refusal to comply with the wages and other monetary claims and
economic provisions of such agreement. benefits, including legal interest, provided
• The Voluntary Arbitrator or panel of the following requisites concur: 

Voluntary Arbitrators, upon agreement of 1. The claim must arise from employer-
the parties, shall also hear and decide all employee relationship;
other labor disputes including unfair labor • 2. T h e c l a i m a n t d o e s n o t s e e k
practices and bargaining deadlocks. reinstatement; and
• 3. The aggregate money claim of each
VOLUNTARY ARBITRATOR employee does not exceed P5,000.00. 

• Article 261,  which provides for the original
and exclusive jurisdiction of voluntary ST LUKE’S CASE
arbitrators over unresolved grievances
arising from the interpretation or The right of an employer to regulate all
implementation of the CBA arising from the aspects of employment, aptly called
interpretation or enforcement of company “management prerogative,” gives employers
p e r s o n n e l p o l i c i e s .    W i t h t h i s the freedom to regulate, according to their
amendment,    the original and exclusive discretion and best judgment, all aspects of
jurisdiction of voluntary arbitrators has employment, including work assignment,
been tremendously expanded. working methods, processes to be followed,
working regulations, transfer of employees,
DOLE SECRETARY work supervision, lay-off of workers and the
• To recapitulate, if a complaint is brought discipline, dismissal and recall of workers.55 In
before the DOLE to give effect to the labor this light, courts often decline to interfere in
standards provisions of the Labor Code or legitimate business decisions of employers.  In
other labor legislation, and there is a fact, labor laws discourage interference in
employers’ judgment concerning the conduct knowledge of its express prohibition under the
of their business.56cralawred SLMC Code of Discipline, she still knowingly
brought out the subject medical items with her.
Among the employer ’s management It is apt to clarify that SLMC cannot be faulted
prerogatives is the right to prescribe in construing the taking of the questioned
reasonable rules and regulations necessary or items as an act of dishonesty (particularly, as
proper for the conduct of its business or theft, pilferage, or its attempt in any form or
concern, to provide certain disciplinary manner) considering that the intent to gain
measures to implement said rules and to may be reasonably presumed from the furtive
assure that the same would be complied with. taking of useful property appertaining to
At the same time, the employee has the another.64 Note that Section 1, Rule 1 of the
corollary duty to obey all reasonable rules, SLMC Code of Discipline is further
orders, and instructions of the employer; and supplemented by the company policy requiring
willful or intentional disobedience thereto, as a the turn-over of excess medical supplies/items
general rule, justifies termination of the for proper handling65 and providing a
contract of service and the dismissal of the restriction on taking and bringing such items
employee.57 Article 296 (formerly Article 282) out of the SLMC premises without the proper
of the Labor Code provides:58cralawred authorization or “pass” from the official
concerned,66 which Sanchez was equally
Article 296. Termination by Employer. - An aware thereof.67 Nevertheless, Sanchez failed
employer may terminate an employment for to turn-over the questioned items and, instead,
any of the following causes: “hoarded” them, as purportedly practiced by
the other staff members in the Pediatric Unit.
(a) Serious misconduct or willful disobedience As it is clear that the company policies subject
by the employee of the lawful orders of his of this case are reasonable and lawful,
employer or his representative in connection sufficiently known to the employee, and
with his work;ChanRoblesVirtualawlibrary evidently connected with the latter’s work, the
Court concludes that SLMC dismissed
x x x xcralawlawlibrary Sanchez for a just cause.

Note that for an employee to be validly

dismissed on this ground, the employer’s ——————————————
orders, regulations, or instructions must be: (1)
reasonable and lawful, (2) sufficiently known to WATERFRONT VS LEDESMA
the employee, and (3) in connection with the
duties which the employee has been engaged   In 2008, the hotel’s management fired
to discharge.”59cralawred Ledesma for reportedly sexually harassing a
female supplier of the hotel concessionaire
Tested against the foregoing, the Court finds inside the hotel’s elevator, as well as a job
that Sanchez was validly dismissed by SLMC applicant in one of the hotel’s conference
for her willful disregard and disobedience of rooms.
Section 1, Rule I of the SLMC Code of
Discipline, which reasonably punishes acts of The SC decision said that Ledesma committed
dishonesty, i.e., “theft, pilferage of hospital or misconduct or improper behavior which
co-employee property, x x x or its attempt in justifies his dismissal from employment.
any form or manner from the hospital, co-  “If not for the position of Ledesma as a house
employees, doctors, visitors, [and] customers detective, he will not have access to the
(external and internal)” with termination from conference room nor will he know that the
employment.60 Such act is obviously premises is not monitored by a closed-circuit
connected with Sanchez’s work, who, as a television, thus, giving him the untrammeled
staff nurse, is tasked with the proper opportunity to accomplish his lewd design on
stewardship of medical supplies. Significantly, the unsuspecting victims,” the decision further
records show that Sanchez made a categorical read.
admission61 in her handwritten letter62 – i.e.,   On August 12, 2008, Ledesma filed a
“[k]ahit alam kong bawal ay nagawa kong complaint for illegal dismissal before the
[makapag-uwi] ng gamit”63 – that despite her
Regional Arbitration Branch of the National
Labor Relations Commission (NLRC).

The labor arbiter favored Ledesma’s claim and

ordered the hotel management to reinstate
Ledesma and pay him back wages and service
incentive leave pay.
 But the hotel’s management appealed before
NLRC which later reversed the ruling of the
labor arbiter.

  NLRC held that Ledesma’s acts of sexual

overtures constituted grave misconduct, which
is a ground for his dismissal from employment.

  NLRC also denied Ledesma’s motion for

reconsideration in a resolution on February 22,
2010.

Ledesma, through his counsel, filed a petition

for certiorari before the Court of Appeals.

  On March 17, 2011, the appellate court

reversed NLRC’s decision and ruled in favor of
Ledesma, saying that his dismissal from
employment was illegal.

  However, the SC opposed CA’s decision and

reinstated the ruling of NLRC’s that found the
dismissal of Ledesma valid due to misconduct.

SEXUAL HARASSMENT The sexual favor is

made as a condition in the hiring or in the
employment, re- employment or continued
employment of said individual, or in
granting said individual favorable
compensation, terms, conditions,
promotions, or privileges; or the refusal to
grant the sexual favor results in limiting,
segregating or classifying the employee
which in a way would discriminate, deprive
or diminish employment opportunities or
otherwise adversely affect said employee;