The Supreme Court affirmed an employer’s right to terminate an employee for serious misconduct, specifically for unauthorized use of company property and dishonesty. This ruling underscores the importance of honesty and adherence to company policies, reinforcing that employers have the prerogative to enforce disciplinary measures to protect their interests and maintain workplace integrity. For employees, this case serves as a cautionary tale, emphasizing the potential consequences of misusing company resources and engaging in deceptive behavior.

Driving Privileges or Entitled Conduct? Daikoku Electronics and the Case of the Midnight Driver

The case of Alberto J. Raza v. Daikoku Electronics Phils., Inc. revolves around the termination of Alberto J. Raza, a driver for Daikoku Electronics, for allegedly taking the company vehicle home without permission and lying about it. Raza contested his dismissal, claiming he had been previously authorized to use the vehicle. The core legal question is whether Raza’s actions constituted serious misconduct warranting termination under the Labor Code of the Philippines. The conflicting findings among the Labor Arbiter, the National Labor Relations Commission (NLRC), and the Court of Appeals (CA) underscore the complexity of determining just cause for dismissal in labor disputes.

The factual backdrop of the case reveals that Raza was employed as a driver and assigned to company president Mamoru Ono. On the evening of July 21, 2003, instead of parking the company vehicle at Ono’s residence, Raza drove it home and parked it overnight without permission. When confronted the following morning, Raza falsely claimed he had parked the car at the condominium. This incident led to a company investigation, revealing that Raza had repeatedly taken the company vehicle home without authorization over the preceding months. Consequently, Daikoku Electronics terminated Raza’s employment for dishonesty, prompting him to file a complaint for illegal dismissal.

The Labor Arbiter initially ruled in favor of Raza, ordering his reinstatement with backwages. However, the NLRC reversed this decision, finding that Raza’s actions constituted just cause for dismissal. The NLRC emphasized that the unauthorized use of the company vehicle and the act of lying to the company president demonstrated disrespect and brought dishonor to the latter. The Court of Appeals affirmed the NLRC’s decision, solidifying the employer’s right to terminate Raza’s employment. This series of conflicting decisions brought the case to the Supreme Court for final adjudication.

In its analysis, the Supreme Court addressed both procedural and substantive issues. Procedurally, Raza argued that the respondents’ motion for reconsideration before the NLRC was filed late. However, the Court found this argument untenable, noting that the motion was mailed on the deadline and presumed to have been filed on time. The Court emphasized the presumption of regularity in the performance of official duties by postal employees, which Raza failed to rebut with sufficient evidence. The Supreme Court highlighted the importance of adhering to procedural rules while also ensuring that substantive justice prevails.

Substantively, the Court examined whether Raza’s actions constituted serious misconduct as defined in Article 282(a) of the Labor Code. This provision allows an employer to terminate employment for:

ART. 282. Termination by employer. – An employer may terminate an employment for any of the following causes:

(a) Serious misconduct or willful disobedience by the employee of the lawful orders of his employer or representative in connection with his work; x x x.

The Court defined misconduct as improper or wrongful conduct, the transgression of an established rule, and a dereliction of duty with wrongful intent. To justify dismissal, the misconduct must be serious, related to the employee’s duties, and indicative that the employee has become unfit to continue working for the employer. The Supreme Court determined that Raza’s repeated unauthorized use of the company vehicle and his act of lying constituted serious misconduct, justifying his termination.

The Court emphasized that Raza’s termination was not solely based on the July 21, 2003 incident but also on the recurring unauthorized use of the company vehicle over the preceding months. The Court cited the condominium security logs, which documented numerous instances where the vehicle was not parked overnight in the assigned area. Despite Raza’s claim that he had permission to use the vehicle, he failed to provide sufficient evidence to support this assertion. The Court noted that Raza’s actions exposed the company to potential risks, including damage to the vehicle and liability to third parties.

The Supreme Court underscored that an employer has a wide latitude of discretion in managing its affairs and implementing company rules and regulations. This includes imposing disciplinary measures on erring employees, provided such measures are applied in good faith and not to circumvent employees’ rights. The Court found that Daikoku Electronics acted within its prerogative in terminating Raza, given the seriousness and frequency of his infractions.

Drawing from prior jurisprudence, the Court cited Soco v. Mercantile Corporation of Davao, where it upheld the dismissal of an employee who used a company vehicle for private purposes without authority. Similarly, in Family Planning Organization of the Philippines v. NLRC, the Court affirmed the dismissal of an employee for unauthorized use of a company vehicle. These cases establish a precedent for upholding an employer’s right to enforce rules against the unauthorized use of company property.

The Supreme Court rejected the Labor Arbiter’s finding that Raza’s infractions were minor and did not warrant dismissal. The Court noted that the Labor Arbiter incorrectly disregarded the security guards’ report and excused Raza’s actions based on his long working hours. The Court clarified that even if Raza worked long hours, it did not justify appropriating company property for personal use without permission. The Court reiterated that an employee’s right to claim overtime or other benefits does not excuse acts of dishonesty or unauthorized conduct.

The Court acknowledged its commitment to social justice and protecting the rights of workers. However, it also recognized that management has rights that must be respected and enforced. The Court balanced its predilection for labor with the need to maintain the legal rights of capital, ensuring justice for the deserving based on established facts, applicable law, and existing jurisprudence. The Supreme Court’s decision reinforces the principle that while employees have rights, they also have responsibilities to adhere to company policies and act with honesty and integrity.

FAQs

What was the key issue in this case?	The key issue was whether the employee’s unauthorized use of a company vehicle and subsequent dishonesty constituted serious misconduct, justifying termination under the Labor Code. The court had to determine if the employer had just cause for dismissing the employee.
What constitutes serious misconduct under the Labor Code?	Serious misconduct involves improper or wrongful conduct that is related to an employee’s duties and indicates that the employee has become unfit to continue working for the employer. It typically involves a transgression of established rules and implies wrongful intent.
What evidence did the employer present to support the dismissal?	The employer presented evidence of repeated unauthorized use of the company vehicle, including security logs showing the vehicle was often taken home without permission. The employer also highlighted the employee’s act of lying about the unauthorized use when confronted.
Did the employee claim he had permission to use the vehicle?	Yes, the employee claimed he had been previously authorized by the company president to use the vehicle. However, he failed to provide sufficient evidence to substantiate this claim, and his initial lie about the vehicle’s whereabouts undermined his credibility.
What is the role of company policies in termination cases?	Company policies play a crucial role as they set the standards of conduct expected from employees. Violation of these policies, especially those related to honesty and the use of company property, can be grounds for disciplinary action, including termination.
How did the Supreme Court balance the rights of the employer and employee?	The Supreme Court recognized its commitment to social justice and protecting workers’ rights but also acknowledged that management has rights that must be respected. It balanced these interests by ensuring that the employer’s decision to terminate was based on just cause and implemented in good faith.
What is the significance of the presumption of regularity in official duties?	The presumption of regularity in official duties means that acts performed by public officials, such as postal workers, are presumed to have been done correctly and legally. In this case, the presumption supported the timeliness of the employer’s motion filed with the NLRC.
What factors did the court consider when determining if the penalty was too harsh?	The court considered the seriousness and frequency of the employee’s infractions, the potential risks to the company, and the employee’s failure to provide credible evidence to support his claims. The court determined that the penalty of dismissal was appropriate given the circumstances.

In conclusion, the Supreme Court’s decision in Alberto J. Raza v. Daikoku Electronics Phils., Inc. underscores the importance of honesty, adherence to company policies, and the employer’s right to enforce disciplinary measures for serious misconduct. The case serves as a reminder to employees of the potential consequences of misusing company resources and engaging in deceptive behavior, while also affirming the employer’s prerogative to protect its interests and maintain workplace integrity.

For inquiries regarding the application of this ruling to specific circumstances, please contact ASG Law through contact or via email at frontdesk@asglawpartners.com.

Disclaimer: This analysis is provided for informational purposes only and does not constitute legal advice. For specific legal guidance tailored to your situation, please consult with a qualified attorney.
Source: ALBERTO J. RAZA VS. DAIKOKU ELECTRONICS PHILS., INC. AND MAMORU ONO, G.R. No. 188464, July 29, 2015