TRANSFER FROM A POSITION OF DIGNITY TO A SERVILE OR MENIAL JOB CONSTITUTES DEMOTION IN RANK

Divine World College of Laoag vs. Mina
G.R. No. 195155, April 13, 2016

Facts:

Divine World College Laoag (DWCL) is  a  non-stock  educational  institution  offering  catholic education to the public.  It is run by the Society of Divine Word (SVD), a congregation of Catholic  priests  that  maintains  several  other  member educational institutions throughout the country.

Mina was first employed in 1971 as a high school teacher, and later on a high school principal, at the Academy of St. Joseph (ASJ), a school run by the SVD.  On June 1, 1979, he transferred to DWCL and was accorded a permanent status after a year of probationary status. He was subsequently transferred in 2002 to DWCL’s college department as an Associate Professor III.    Thereafter,  on  June  1,  2003,  Mina  was  assigned  as  the  College Laboratory  Custodian  of  the  School  of  Nursing  and  was  divested of  his teaching  load,  effective  June  1,  2003  until  May  31,  2004,  subject  to automatic termination and without need for any further notification. He was  the  only  one  among  several  teachers  transferred  to  the  college department who was divested of teaching load.

In early June 2004, Mina was offered early retirement by the Officer-in-Charge of DWCL’s School of Nursing.  He initially declined the offer.  He later received a Memorandum from the Office of the Dean enumerating specific acts of gross or habitual negligence, insubordination, and reporting for work under the influence of alcohol.  He answered  the  allegations  against  him;  sensing,  however,  that  it  was pointless  to  continue  employment with DWCL, he requested that his retirement date be adjusted to September 2004 to enable him to avail of the 25-year benefits.  He also requested for the inclusion of his eight years of service in ASJ, to make his total years of service to 33 years pursuant to the portability  clause  of  the  retirement  plan,  which  was  denied  by DWCL. Instead, he was paid ₱275,513.00 as retirement pay.  It was made to appear that his services were terminated by reason of redundancy to avoid any tax implications.  Mina was also made to sign a deed of waiver and quitclaim stating that he no longer has any claim against DWCL with respect to any matter arising from his employment in the school. On  September  21,  2004,  he  filed  a  case  for  illegal  dismissal  and recovery of separation pay and other monetary claims.  Pending resolution of his case, Mina passed away on June 18, 2005.

LA Ruling:

The Labor Arbiter (LA) rendered its Decision, ruling  that  the  actuation  of  DWCL  is  not  constitutive  of  constructive dismissal.  The LA ratiocinated, however, that the computation of Mina’s retirement pay based on redundancy is illegal; hence, it was modified, and the number of years he worked for ASJ was added to the years he worked for DWCL thus making his creditable number of years of service to 33 years. According to the LA, his length of service in both institutions will be taken into consideration in determining his total years of continuous service since the DWEA Retirement Plan has a provision on portability, which allows a member to carry the earned credit for his number of years of service from his former participating employer to his new employer.  Moreover, the LA held that there is no showing that Mina ceased to be a member of the plan when he left the ASJ as there was not a day that he was separated from any school that is the member of the plan. Both appealed to the NLRC.

NLRC Ruling:

The NLRC ruled that Mina was constructively dismissed when he was appointed as College Laboratory Custodian and divested of his teaching load without any justification. It also ruled that Mina was not deemed to have waived all his claims against DWCL as quitclaims cannot bar employees from demanding benefits to which they are legally entitled. The NLRC, however,  disregarded  Mina’s  eight  years  of  service  in  ASJ  in  the computation of his retirement pay because of his failure to show compliance with  the  portability  provision.

DWCL’s motion for reconsideration was denied. Thus, it filed a petition for certiorari with the CA.

CA Ruling:

The CA denied the petition but modified the award.  It sustained the NLRC’s ruling that Mina was  indeed  constructively  dismissed  from  work.   The  CA  also  held  that Mina is entitled to receive backwages to be computed from the time of hiring on June 1, 1979 until the time of his death on June 18, 2005, as he was constructively dismissed from work. The MR was denied. Hence, the petition.

Issue/s

1. Whether or not there the transfer amounted to constructive dismissal
2. Whether or not the eight years of service in ASJ should be included

SC Ruling:

The SC ruled that there was constructive dismissal. Mina’s  transfer  clearly  amounted  to  a  constructive dismissal.  For almost 22 years, he was a high school teacher enjoying a permanent status  in  DWCL’s  high  school  department. Not only that.  He was also divested of his teaching load.  His appointment  even became contractual in nature and was subject to automatic termination after one year “without any further notification.” Aside from this, Mina was the only  one  among  the  high  school  teachers  transferred  to  the  college department who was divested of teaching load.  More importantly, DWCL failed  to  show  any  reason  for  Mina’s  transfer  and  that  it  was  not unreasonable, inconvenient, or prejudicial to him.

Also, Mina’s appointment as laboratory custodian was a demotion.  There is demotion when an employee occupying a  highly  technical  position  requiring  the  use  of  one’s  mental  faculty  is transferred  to  another  position,  where  the  employee  performed  mere mechanical work – virtually a transfer from a position of dignity to a servile or  menial  job.    The  assessment  whether  Mina’s  transfer  amounted to a demotion must be done in relation to his previous position, that is, from an associate college professor, he was made a keeper and inventory-taker of laboratory  materials.  Clearly,  Mina’s  new  duties  as  laboratory custodian were merely perfunctory and a far cry from his previous teaching job, which involved the use of his  mental faculties.  And  while there was no  proof adduced showing that his salaries and benefits were diminished, there was clearly  a  demotion  in  rank.

The SC held that the CA erred in computing the  amount  to  be  awarded  as  backwages  from  the  time  of  Mina’s hiring  on  June  1,  1979  until  the  time  of  his  death  on  June  18,  2005, apparently  interchanging  backwages  and  separation  pay. The basis for the payment of backwages is different from that of the award of separation pay.  “The basis for computing separation pay is usually the length of the employee’s past service, while that for backwages is the actual period when the employee was unlawfully prevented from working. Thus, the computation of Mina’s backwages should be from the time he was constructively dismissed on June 1, 2003.

The Court affirms the NLRC’s findings that the eight years of service rendered by Mina in ASJ shall not be included in the computation of his retirement benefits.  No adequate proof is shown that he has complied with the portability clause of the DWEA Retirement Plan.  The employee has the burden of proof to show compliance with the requirements set forth in retirement plans, being in the nature of privileges granted to employees.  Failure  to  overcome  the  burden  of  proof  would  necessarily  result  in  the employee’s disqualification to receive the benefits.