SPI Tech. v. Mapua (G.R. No. 191154; April 7, 2014)

CASE DIGEST: SPI TECHNOLOGIES, INC., ET AL., Petitioners, v. VICTORIA K. MAPUA, Respondent.

FACTS: Victoria K. Mapua (Mapua) alleged that she was hired in 2003 by SPI Technologies, Inc. (SPI) and was the Corporate Developments Research/Business Intelligence Unit Head and Manager of the company.

Subsequently in August 2006, the then Vice President and Corporate Development Head, Peter Maquera (Maquera) hired Elizabeth Nolan (Nolan) as Mapuas supervisor.

Sometime in October 2006, the hard disk on Mapuas laptop crashed, causing her to lose files and data. Mapua informed Nolan and her colleagues that she was working on recovering the lost data and asked for their patience for any possible delay on her part in meeting deadlines.

On November 13, 2006, Mapua retrieved the lost data with the assistance of National Bureau of Investigation Anti-Fraud and Computer Crimes Division. Yet, Nolan informed Mapua that she was realigning Mapuas position to become a subordinate of co-manager Sameer Raina (Raina) due to her missing a work deadline. Nolan also disclosed that Mapuas colleagues were demotivated because she was taking things easy while they were working very hard, and that she was frequently absent, under timing, and coming in late every time [Maquera] goes on leave or on vacation.

On November 16, 2006, Mapua obtained a summary of her attendance for the last six months to prove that she did not have frequent absences or under time when Maquera would be on leave or vacation. When shown to Nolan, she was merely told not to give the matter any more importance and to just move on.

In December 2006, Mapua noticed that her colleagues began to ostracize and avoid her. Nolan and Raina started giving out majority of her research work and other duties under Healthcare and Legal Division to the rank-and-file staff. Mapua lost about 95% of her work projects and job responsibilities.

Mapua consulted these work problems with SPIs Human Resource Director, Lea Villanueva (Villanueva), and asked if she can be transferred to another department within SPI. Subsequently, Villanueva informed Mapua that there is an intra-office opening and that she would schedule an exploratory interview for her. However, due to postponements not made by Mapua, the interview did not materialize.

On February 28, 2007, Mapua allegedly saw the new table of organization of the Corporate Development Division which would be renamed as the Marketing Division. The new structure showed that Mapuas level will be again downgraded because a new manager will be hired and positioned between her rank and Rainas.

On March 21, 2007, Raina informed Mapua over the phone that her position was considered redundant and that she is terminated from employment effective immediately. Villanueva notified Mapua that she should cease reporting for work the next day. Her laptop computer and company mobile phone were taken right away and her office phone ceased to function.

Mapua was shocked and told Raina and Villanueva that she would sue them. Mapua subsequently called her lawyer to narrate the contents of the termination letter.

Mapuas lawyer, in a phone call, advised Villanueva that SPI violated Mapuas right to a 30-day notice. Mapua filed with the Labor Arbiter (LA) a complaint for illegal dismissal, claiming reinstatement or if deemed impossible, for separation pay. Afterwards, she went to a meeting with SPI, where she was given a second termination letter, the contents of which were similar to the first one.

On April 25, 2007, Mapua received through mail, a third Notice of Termination dated March 21, 2007 but the date of effectivity of the termination was changed from March 21 to April 21, 2007. It further stated that her separation pay will be released on May 20, 2007 and a notation was inscribed, refused to sign and acknowledge with unintelligible signatures of witnesses.

On May 13, 2007, a recruitment advertisement of SPI was published in the Philippine Daily Inquirer (Inquirer advertisement, for brevity). It listed all vacancies in SPI, including a position for Marketing Communications Manager under Corporate Support the same group where Mapua previously belonged.

SPI also sent a demand letter to Mapua, asking her to pay for the remaining net book value of the company car assigned to her under SPIs car plan policy. Under the said plan, Mapua should pay the remaining net book value of her car if she resigns within five years from start of her employment date.

In her Reply and Rejoinder, Mapua submitted an affidavit and alleged that Prime Manpower Resources Development (Prime Manpower) posted an advertisement on the website of Jobstreet Philippines for the employment of a Corporate Development Manager in an unnamed Business Process Outsourcing (BPO) company located in Paraque City. Mapua suspected that this advertisement was for SPI because the writing style used was similar to Rainas. She also claimed that SPI is the only BPO office in Paraque City at that time. Thereafter, she applied for the position under the pseudonym of Jeanne Tesoro. On the day of her interview with Prime Manpowers consultant, Ms. Portia Dimatulac (Dimatulac), the latter allegedly revealed to Mapua that SPI contracted Prime Manpowers services to search for applicants for the Corporate Development Manager position.

Because of these developments, Mapua was convinced that her former position is not redundant. According to her, she underwent psychiatric counseling and incurred medical expenses as a result of emotional anguish, sleepless nights, humiliation and shame from being jobless. She also averred that the manner of her dismissal was unprofessional and incongruous with her rank and stature as a manager as other employees have witnessed how she was forced to vacate the premises on the same day of her termination.

On the other hand, SPI stated that the company regularly makes an evaluation and assessment of its corporate/organizational structure due to the unexpected growth of its business along with its partnership with ePLDT and the acquisition of CyMed. As a result, SPI underwent a reorganization of its structure with the objective of streamlining its operations. This was embodied in an Inter-Office Memorandum dated August 28, 2006 issued by the companys Chief Executive Officer.

SPI denied contracting the services of Prime Manpower for the hiring of a Corporate Development Manager and emphasized that Prime Manpower did not even state the name of its client in the Jobstreet website. SPI also countered that Dimatulacs alleged revelation to Mapua that its client is SPI must be struck down as mere hearsay because only Mapua executed an affidavit to prove that such disclosure was made. While SPI admitted the Inquirer advertisement, the company stated that Mapua was a Corporate Development Manager and not a Marketing Communications Manager, and that from the designations of these positions, it is obvious that the functions of one are entirely different from that of the other.

LA declared the termination to be illegal. NLRC reversed the decision. CA reinstated LAs decision.

ISSUES:

Was Mapua's termination illegal?
Was the redundancy program valid?
HELD: Mapua was dismissed from employment supposedly due to redundancy. However, she contended that her position as Corporate Development Manager is not redundant. She cited that SPI was in fact actively looking for her replacement after she was terminated. Furthermore, SPI violated her right to procedural due process when her termination was made effective on the same day she was notified of it.

Article 283 of the Labor Code provides for the following:

ART. 283. Closure of establishment and reduction of personnel. The employer may also terminate the employment of any employee due to installation of labor-saving devices, redundancy, retrenchment to prevent losses or the closing or cessation of operation of the establishment or undertaking unless the closing is for the purpose of circumventing the provisions of this Title, by serving a written notice on the worker and the Department of Labor and Employment at least one (1) month before the intended date thereof. In case of termination due to installation of labor-saving devices or redundancy, the worker affected thereby shall be entitled to a separation pay equivalent to at least one (1) month pay or to at least one (1) month pay for every year of service, whichever is higher. In case of retrenchment to prevent losses and in cases of closures or cessation of operations of establishment or undertaking not due to serious business losses and financial reverses, the separation pay shall be equivalent to one (1) month pay or at least one-half () month pay for every year of service, whichever is higher. A fraction of at least six (6) months shall be considered as one (1) whole year.

Expounding on the above requirements of written notice and separation pay, this Court in Asian Alcohol Corporation v. NLRC pronounced that for a valid implementation of a redundancy program, the employer must comply with the following requisites: (1) written notice served on both the employee and the DOLE at least one month prior to the intended date of termination; (2) payment of separation pay equivalent to at least one month pay or at least one month pay for every year of service, whichever is higher; (3) good faith in abolishing the redundant position; and (4) fair and reasonable criteria in ascertaining what positions are to be declared redundant.

Anent the first requirement which is written notice served on both the employee and the DOLE at least one month prior to the intended date of termination, SPI had discharged the burden of proving that it submitted a notice to the DOLE on March 21, 2007, stating therein that the effective date of termination is on April 21, 2007. It is, however, quite peculiar that two kinds of notices were served to Mapua. One termination letter stated that its date of effectivity is on the same day, March 21, 2007. The other termination letter sent through mail to Mapuas residence stated that the effective date of her termination is on April 21, 2007.

Explaining the discrepancy, SPI alleged that the company served a notice to Mapua on March 21, 2007, which stated that the effective date of termination is on April 21, 2007. However she refused to acknowledge or accept the letter. Later on, Mapua requested for a copy of the said letter but due to inadvertence and oversight, a draft of the termination letter bearing a wrong effectivity date was given to her. To correct the oversight, a copy of the original letter was sent to her through mail.

Our question is, after Mapua initially refused to accept the letter, why did SPI make a new letter instead of just giving her the first one which the Court notes was already signed and witnessed by other employees?

Curiously, there was neither allegation nor proof that the original letter was misplaced or lost which would necessitate the drafting of a new one. SPI did not even explain in the second letter that the same was being sent in lieu of the one given to her. Hence, SPI must shoulder the consequence of causing the confusion brought by the variations of termination letters given to Mapua.

On the matter of separation pay, there is no question that SPI indeed offered separation pay to Mapua, but the offer must be accompanied with good faith in the abolishment of the redundant position and fair and reasonable criteria in ascertaining the redundant position. It is insignificant that the amount offered to Mapua is higher than what the law requires because the Court has previously noted that a job is more than the salary that it carries. There is a psychological effect or a stigma in immediately finding ones self laid off from work.

***

In AMA Computer College, Inc. v. Garcia, et al., the Court held that the presentation of the new table of the organization and the certification of the Human Resources Supervisor that the positions occupied by the retrenched employees are redundant are inadequate as evidence to support the colleges redundancy program.

Also connected with the evidence negating redundancy was SPIs publication of job vacancies after Mapua was terminated from employment. SPI maintained that the CA erred when it considered Mapuas self-serving affidavit as regards the Prime Manpower advertisement because the allegations therein were based on Mapuas unfounded suspicions. Also, the failure of Mapua to present a sworn statement of Dimatulac renders the formers statements hearsay.

Even if we disregard Mapuas affidavit as regards the Prime Manpower advertisement, SPI admitted that it caused the Inquirer advertisement for a Marketing Communications Manager position. Mapua alleged that this advertisement belied the claim of SPI that her position is redundant because the Corporate Development division was only renamed to Marketing division.

Instead of explaining how the functions of a Marketing Communications Manager differ from a Corporate Development Manager, SPI hardly disputed Mapua when it stated that, judging from the titles or designation of the positions, it is obvious that the functions of one are entirely different from that of the other. SPI, being the employer, has possession of valuable information concerning the functions of the offices within its organization. Nevertheless, it did not even bother to differentiate the two positions.

Furthermore, on the assumption that the functions of a Marketing Communications Manager are different from that of a Corporate Development Manager, it was not even discussed why Mapua was not considered for the position. While SPI had no legal duty to hire Mapua as a Marketing Communications Manager, it could have clarified why she is not qualified for that position. In fact, Mapua brought up the subject of transfer to Villanueva and Raina several times prior to her termination but to no avail. There was even no showing that Mapua could not perform the duties of a Marketing Communications Manager.

Therefore, even though the CA based its ruling only on the Prime Manpower advertisement coupled with the purported disclosure to Mapua, the Court holds that the confluence of other factors supports the said ruling. The Court does not agree with the rationalization of the NLRC that if it were true that her position was not redundant and indispensable, then the company must have already hired a new one to replace her in order not to jeopardize its business operations. The fact that there is none only proves that her position was not necessary and therefore superfluous.

What the above reasoning of the NLRC failed to perceive is that of primordial consideration is not the nomenclature or title given to the employee, but the nature of his functions. It is not the job title but the actual work that the employee performs. Also, change in the job title is not synonymous to a change in the functions. A position cannot be abolished by a mere change of job title. In cases of redundancy, the management should adduce evidence and prove that a position which was created in place of a previous one should pertain to functions which are dissimilar and incongruous to the abolished office.

***

The Court sustains the CAs award of moral and exemplary damages.Award of moral and exemplary damages for an illegally dismissed employee is proper where the employee had been harassed and arbitrarily terminated by the employer. Moral damages may be awarded to compensate one for diverse injuries such as mental anguish, besmirched reputation, wounded feelings, and social humiliation occasioned by the employers unreasonable dismissal of the employee. The Court has consistently accorded the working class a right to recover damages for unjust dismissals tainted with bad faith; where the motive of the employer in dismissing the employee is far from noble. The award of such damages is based not on the Labor Code but on Article 220 of the Civil Code. However, the Court observes that the CA decision affirming the LAs award of P500,000.00 and P250,000.00 as moral and exemplary damages, respectively, is evidently excessive because the purpose for awarding damages is not to enrich the illegally dismissed employee. Consequently, the Court hereby reduces the amount of P50,000.00 each as moral and exemplary damages.

Mapua is also entitled to attorneys fees but the Court is modifying the amount of P196,848.42 awarded by the LA and fix such attorneys fees in the amount of ten percent (10%) of the total monetary award, pursuant to Article 11157 of the Labor Code.

WHEREFORE, the Decision dated October 28, 2009 and Resolution dated January 18, 2010 of the Court of Appeals in CA-G.R. SP. No. 107879 are hereby AFFIRMED with MODIFICATIONS.

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