The law on probationary employment of private school teachers


This Petition for Review on Certiorari seeks to reverse and set aside the November 27, 2014 Decision[1] and June 3, 2015 Resolution[2] of the Court of Appeals (CA) in CA-G.R. SP No. 134967, which affirmed the November 29, 2013 Decision[3] and January 30, 2014 Resolution[4] of the National Labor Relations Commission (NLRC) in NLRC NCR Case No. 08-12904-12/ NLRC LAC No. 10-002985-13.

Petitioner De La Salle Araneta University (DLSAU) first hired respondent Marie Nel A. Prepotente (Prepotente) as a probationary full-time faculty member under the Special Education Unit of the Basic Education Department for the school year 2009-2010. The probationary contract was later renewed for the school years 2010-2011 and 2011-2012. Upon expiration of the last probationary contract on April 13, 2012, DLSAU no longer renewed her employment contract.

This prompted Prepotente to file a complaint for illegal dismissal before the Labor Arbiter (LA). She averred that, upon the completion of her third probationary year as faculty member, she already attained regular status and could only be terminated for a just cause and after compliance with procedural due process. She claimed that she was illegally dismissed and prayed for reinstatement and payment of backwages.

For its part, DLSAU contended that their decision not to renew Prepotente's contract was due to her failure to meet the reasonable standards necessary to attain regular status. It noted that she was duly informed of the reasonable standards at the time she was first engaged as faculty member. DLSAU explained that her contract was not renewed because of her unsatisfactory attendance record. DLSAU provided a tally of Prepotente's alleged absences and tardiness, viz:

Total number
of Tardiness
Total Number
of Tardiness
Total Number
of Absences
2 days
9 minutes
9 (without leave) 17 (with leave of absence)
1st Minor Offense (given written warning)[5]

DLSAU emphasized that at the end of the three-year probationary employment, it still had to decide whether she met the reasonable standards for regular employment. It stressed that she was not illegally dismissed from employment, rather, her probationary contract merely expired.

The LA Ruling

In its September 24, 2013 Decision,[6] the LA dismissed the complaint for lack of merit. It held that Prepotente's employment with DLSAU simply ceased upon the lapse of the last probationary employment contract. The LA declared that the mere completion of the, probationary period for employment was not enough for a private school teacher to qualify as permanent or regular member of the faculty. It concluded that the teacher must also satisfy the school's requirements regarding performance and qualifications. The LA disposed the case in this wise:
WHEREFORE, judgment is hereby rendered DISMISSING the instant complaint for lack of merit. Respondent university, is, however, directed to pay complainant's final pay from May 16-31, 2012, or the amount of P10,206.50 subject to her compliance with the appropriate clearance procedures of the university.

All the money claims as well as damages and attorney's fees are also DISMISSED for lack of merit.

Unconvinced, Prepotente interposed an appeal before the NLRC.

The NLRC Ruling

In its November 29, 2013 Decision, the NLRC partially granted Prepotente's appeal and ruled that she was illegally dismissed. It stated that DLSAU did not offer any evidence to prove that she failed to qualify for regularization; and that DLSAU should have presented its policy on absences, her attendance records and assessment reports as these documents consisted the best evidence of her alleged lackluster performance and the justification for the eventual non-renewal of her probationary employment contract. The fallo reads:
WHEREFORE, premises considered, the appeal is PARTIALLY GRANTED. The 24 September 2013 Decision of Labor Arbiter Jaime M. Reyno is hereby modified in that complainant-appellant is declared as having been illegally dismissed.

Consequently, respondent-appellee University is ordered to pay complainant-appellant full backwages computed from the time her compensation was withheld from her up to the time of finality of this Decision which is tentatively computed in the amount of P387,847.00 and separation pay equivalent to one month's salary for every year of service in the amount of P81.652.00.

The rest of the decision stands. Other claims are denied for lack of merit.

Dissatistifed, DLSAU filed a motion for reconsideration thereto. In its January 30, 2014 Resolution, the NLRC denied the same.

Aggrieved, DLSAU filed a petition for certiorari with the CA.

The CA Ruling

In its decision, dated November 27, 2014, the CA dismissed the petition. It held that in order to prove that an employee did not meet the standards set by the employer for regular employment, the employer should show how these standards were applied. The CA observed that DLSAU had all the attendance records of its employees, yet, it failed to present any documentary evidence to establish its claim that she had incurred excessive absences and tardiness.

DLSAU moved for reconsideration, but its motion was denied by the CA in its assailed June 3, 2015 resolution.

Hence, this present petition.
Sole Issue

DLSAU argues that Prepotente's contract merely expired after the third year of her probationary status; that her gross inefficiency as well as her habitual absences and tardiness from classes rendered her service unsatisfactory; and that there was no need to determine whether there was compliance with the procedural requirements of notice and hearing as these requirements apply only in cases of dismissal from service.

In her Comment,[7] dated October 14, 2015, Prepotente countered that DLSAU failed to submit any evidence that she was informed of the reasonable standards that she was required to meet in order to qualify as a regular employee; and that DLSAU did not adduce evidence to support its allegations regarding her absences and tardiness.

In its Reply,[8] dated March 4, 2016, DLSAU stressed that Prepotente was not qualified for regularization due to her numerous absences and tardiness; and that her contract merely expired and was not renewed after due evaluation because she failed to meet the reasonable standards to acquire permanent status.

The Court's Ruling

The petition is bereft of merit.

In Mercado, v. AMA Computer College- Parañaque City, Inc.,[9] the Court, explained probationary employment in this wise:
The provision on employment on probationary status under the Labor Code is a primary example of the fine balancing of interests between labor and management that the Code has institutionalized pursuant to the underlying intent of the Constitution.

On the one hand employment on probationary status affords management the chance to fully scrutinize the true worth of hired personnel before the full force of the security of tenure guarantee of the Constitution comes!into play. Based on the standards set at the start of the probationary period, management is given the widest opportunity during the probationary period to reject hirees who fail to meet its own adopted but reasonable standards. These standards, together with the just and authorized causes for termination of employment the Labor Code expressly provides, are the grounds available to terminate the employment of a teacher on probationary status. For example, the school may impose reasonably stricter attendance or report compliance records on teachers on probation, and reject a probationary teacher for failing in this regard, although the same attendance or compliance record may not be required for a teacher already on permanent status. At the same time, the same just and authorizes causes for dismissal under the Labor Code apply to probationary teachers, so that they may be the first to be laid-off if the school does not have enough students for a given semester or trimester. Termination of employment on this basis is an authorized cause under the Labor Code.

Labor, for its part, is given the protection during the probationary period of knowing the company standards the new hires have to meet during the probationary period, and to be judged on the basis of these standards, aside from the usual standards applicable to employees after they achieve permanent status. Under the terms of the Labor Code, these standards should be made known to the teachers on probationary status at the start of their probationary period, or at the very least under the circumstances of the present case, at the start of the semester or the trimester during which the probationary standards are to be applied. Of critical importance in invoking a failure to meet the probationary standards, is that the j school should show - as a matter of due process - how these! standards have been applied. This is effectively the second notice in a dismissal situation that the law requires as a due process guarantee supporting the security of tenure provision, and is in furtherance, too, of the basic rule 'in employee dismissal that the employer carries the burden of justifying a dismissal. These rules ensure compliance with the limited security of tenure guarantee the law extends to probationary employees.
The Labor Code, as supplemented by the 2010 Revised Manual of Regulations for Private Schools in Basic Education (2010 Manual), governs the employment of academic teaching personnel. With regard to the probationary period, Section 63 of the 2010 Manual provides:
Section 63. A probationary period of not more than three years in the case of the school teaching personnel and not more than six months for non-teaching personnel shall be required for employment in all private schools. A school personnel who has successfully undergone the probationary period herein specified and who is fully qualified under existing rules and standards of the school shall be considered permanent.
This scheme of hiring teachers on a probationary basis is subject to Article 281 of the Labor Code, which states:
Art. 281. x x 1 x The services of an employee who has been engaged on a probationary basis may be terminated for a just cause or when he fails to qualify as a regular employee in accordance with reasonable standards made known by the employer to the employee at the time of his engagement. An employee who is allowed to work after a probationary period shall be considered a regular employee.
In University of Sto. Tomas v. National Labor Relations Commission,[10] this Court, in: interpreting the foregoing rules, held that the legal requisites for a teacher to acquire permanent employment and security of tenure are as follows:
(l) The teacher is a full-time teacher;
(2) The teacher must have rendered three (3) consecutive years of service; and
(3) Such service must have been satisfactory.
In the case at bench, it is undisputed that Prepotente has been employed for three (3) consecutive years as a full-time teacher at DLSAU from July 2, 2009 to April ,15, 2010; June 1, 2010 to April 15, 2011; and June 1, 2011 to April 13, 2012. The only question left to be resolved is whether her three-year service was satisfactory.

After a judicious study of the records, the Court finds that DLSAU failed to prove that Prepotente's performance was unsatisfactory. First, the exact terms of the standards that she was expected to meet in order to qualify as a regular employee where never introduced as evidence. Nowhere in the DLSAU Handbook[11] or in her Contracts of Probation[12] could such standards be found. In all cases 'of probationary employment, the employer shall convey to the employee the standards under which he will qualify as a regular employee at the time of his engagement. Where no standards are made known to the employee at that time, he shall be deemed a regular employee.[13]

Second, the records do not show how these standards were applied to Prepotente. DLSAU basically presented a simple tally of her tardiness and absences, without any supporting documents. Considering that she was on probation for three (3) years, the results of her actual performance should have been documented.' Specifically, DLSAU should have presented her attendance records, evaluation reports and other related documents to support its claim of disqualification. Without these pieces of evidence, the Court has nothing to consider and pass upon as valid or invalid. Absent any showing of unsatisfactory performance on the part of the employee, it can be presumed that his/her performance was satisfactory. [14]

Thus, the Court holds that after serving three (3) consecutive years, with no showing of unsatisfactory performance, Prepotente attained the status of a regular employee who could not be dismissed, except for just or authorized cause.[15]

Probationary employees enjoy security of tenure during the term of their probationary employment. As such, they cannot be removed except for cause as provided by law, or if at the end of every yearly contract during the three-year period, the employee does not meet the reasonable standards set by the employer at the time of engagement.[16] Mere expiration of contract is not one of the just or authorized causes provided by law. Thus, Prepotente was illegally dismissed because DLSAU was unable to prove that she failed to meet the reasonable standards to become a regular employee.

Lastly, DLSAU failed to comply with procedural due process in terminating Prepotente's employment. Even assuming that she failed to meet the standards to qualify as a regular employee, still, the termination was flawed for failure to give the required notice to her. Section 2, Rule I, Book VI of the Implementing I Rules and Regulation of the Labor Code provides that if the termination is brought about by failure of an employee to meet the standards of the employer in the case of probationary employment, it shall be sufficient that a written notice is served the employee, within a reasonable time from the effective date of termination. As a matter of due process, teachers on probationary employment, just like all probationary employees, have the right to know whether they have met the standards against which their performance was evaluated. Should they fail, they also have the right to know the reasons therefor.[17] Here, DLSAU failed to give a written notice of termination to Prepotente.

WHEREFORE, the petition is DENIED. The November 27, 2014 Decision of the Court of Appeals in CA-G.R. SP No. 134967 is AFFIRMED in toto.

SO ORDERED. (Brion, J., on leave)

[1] Penned by Associate Justice Hakim S. Abdulwahid with Associafe Justices Romeo F. Barza and Ramon A. Cruz, concurring; rollo, pp. 249-259.

[2] Id. at 275-276.

[3] Penned by Commissioner Pablo C. Espiritu, Jr. with Presiding Commissioner Alex A. Lopez and Commissioner Gregorio O. Bilog, III, concurring; id. at 149-155.

[4] Id. at 167-168.

[5] Id. at 56.

[6] Penned by Labor Arbiter Jaime M. Reyno; id. at 102-108.

[7] Id. at 287-311.

[8] Id. at 331-342.

[9] 632 Phil. 228-261 (2010).

[10] 261 Phil. 483-496(1990).

[11] Rollo, pp. 26-27.

[12] Id. at 28-30.

[13] Tamson 's Enterprises, Inc. v. Court of Appeals, 676 Phil. 384-402 (2011).

[14] Colegio del Santisimo Rosario v. Rojo, 717 Phil. 265 (2013).

[15] Article 294. [279] Security of. Tenure — In cases of regular- employment, the employer shall not terminate the services of an employee except for a just cause or when authorized by this Title, xxx

[16] Magis Young Achievers Learning Center v. Manalo, 598 Phil. 886 (2009).

[17] Colegio del Santisimo Rosario v. Rojo, supra note 14.

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