MERE COMPLIANCE WITH STANDARD PROCEDURES OR PROCESSES, SUCH AS THE COMPLETION OF EXIT INTERVIEWS, NEITHER NEGATES COMPULSION NOR INDICATES VOLUNTARINESS IN RESIGNATION

Saudi Arabian Airlines (Saudia) and Brenda J. Betia Vs. Ma. Jopette M. Rebesencio Montassah B. Sacar-Adiong, et al.
G.R. No. 198587, January 14, 2015

Facts:

Respondents (complainants before the Labor Arbiter) were recruited and hired by Saudia as Temporary Flight Attendants with the accreditation and approval of the Philippine Overseas Employment Administration.

After undergoing seminars required by the Philippine Overseas Employment Administration for deployment overseas, as well as training modules offered by Saudia (e.g., initial flight attendant/training course and transition training), and after working as Temporary Flight Attendants, respondents became Permanent Flight Attendants.

They then entered into Cabin Attendant contracts with Saudia. Respondents continued their employment with Saudia until they were separated from service on various dates in 2006. Respondents contended that the termination of their employment was illegal. They alleged that the termination was made solely because they were pregnant.

As respondents alleged, they had informed Saudia of their respective pregnancies and had gone through the necessary procedures to process their maternity leaves. Initially, Saudia had given its approval but later on informed respondents that its management in Jeddah, Saudi Arabia had disapproved their maternity leaves.

In addition, it required respondents to file their resignation letters. Respondents were told that if they did not resign, Saudia would terminate them all the same. The threat of termination entailed the loss of benefits, such as separation pay and ticket discount entitlements.

Specifically, Ma. Jopette received a call from Saudia’s Base Manager, Abdulmalik Saddik (Abdulmalik). Montassah was informed personally by Abdulmalik and a certain Faisal Hussein after being required to report to the office one (1) month into her maternity leave. Rouen Ruth was also personally informed by Abdulmalik after being required to report to the office by her Group Supervisor. Loraine received a call from her Group Supervisor, Dakila Salvador.

Saudia anchored its disapproval of respondents’ maternity leaves and demand for their resignation on its “Unified Employment Contract for Female Cabin Attendants” (Unified Contract). Under the Unified Contract, the employment of a Flight Attendant who becomes pregnant is rendered void stating that if the Air Hostess becomes pregnant at any time during the term of this contract, this shall render her employment contract as void and she will be terminated due to lack of medical fitness.

Respondents emphasized that the Unified Contract took effect on September 23, 2006 (the first day of Ramadan), well after they had filed and had their maternity leaves approved.

Rather than comply and tender resignation letters, respondents filed separate appeal letters that were all rejected. Despite these initial rejections, respondents each received calls on the morning from Saudia’s office secretary informing them that their maternity leaves had been approved.

Saudia, however, was quick to renege on its approval. Respondents again received calls informing them that it had received notification from Jeddah, Saudi Arabia that their maternity leaves had been disapproved.

Faced with the dilemma of resigning or totally losing their benefits, respondents executed handwritten resignation letters. In Montassah’s and Rouen Ruth’s cases, their resignations were executed on Saudia’s blank letterheads that Saudia had provided. These letterheads already had the word “RESIGNATION” typed on the subject portions of their headings when these were handed to respondents.

Respondents filed a Complaint against Saudia and its officers for illegal dismissal and for underpayment of salary, overtime pay, premium pay for holiday, rest day, premium, service incentive leave pay, 13th month pay, separation pay, night shift differentials, medical expense reimbursements, retirement benefits, illegal deduction, lay-over expense and allowances, moral and exemplary damages, and attorney’s fees.

Saudia assailed the jurisdiction of the Labor Arbiter. It claimed that all the determining points of contact referred to foreign law and insisted that the Complaint ought to be dismissed on the ground of forum non conveniens. It added that respondents had no cause of action as they resigned voluntarily.

LA Ruling:

The Executive Labor Arbiter Fatima Jambaro-Franco rendered the Decision dismissing respondents’ Complaint.

NLRC Ruling:

On respondents’ appeal, the National Labor Relations Commission’s Sixth Division reversed the ruling of Executive Labor Arbiter Jambaro-Franco. It explained that “[c]onsidering that complainants-appellants are OFWs, the Labor Arbiters and the NLRC has [sic] jurisdiction to hear and decide their complaint for illegal termination.”

On the matter of forum non conveniens, it noted that there were no special circumstances that warranted its abstention from exercising jurisdiction. On the issue of whether respondents were validly dismissed, it held that there was nothing on record to support Saudia’s claim that respondents resigned voluntarily.

The National Labor Relations Commission denied petitioners’ Motion for Reconsideration.

CA Ruling:

The Court of Appeals denied petitioners’ Rule 65 Petition and modified the Decision of the National Labor Relations Commission with respect to the award of separation pay and backwages.

The Court of Appeals denied petitioners’ Motion for Reconsideration. Hence, the Appeal before the SC.

Issue/s:

Whether or not jurisdiction was acquired when the summons was served on Saudia Manila and not Saudia Jeddah

Whether or not it can be validly stipulated that the employment of a stewardess who got pregnant is void.

Whether or not the case should be dismissed with the resignation of respondents in this case

SC Ruling:

Petitioners claim that “Saudia Manila” was never a party to the Cabin Attendant contracts entered into by respondents; it was “Saudia Jeddah” that provided the funds to pay for respondents’ salaries and benefits; and, it was with “Saudia Jeddah” that respondents filed their resignations.

Saudia posits that respondents’ Complaint was brought against the wrong party because “Saudia Manila,” upon which summons was served, was never the employer of respondents.

What is clear is Saudia’s statement in its own Petition that what it has is a “Philippine Office . . . located at 4/F Metro House Building, Sen. Gil J. Puyat Avenue, Makati City.” Even in the position paper that Saudia submitted to the Labor Arbiter, what Saudia now refers to as “Saudia Jeddah” was then only referred to as “Saudia Head Office at Jeddah, KSA,” while what Saudia now refers to as “Saudia Manila” was then only referred to as “Saudia’s office in Manila.”

Guide to Valid Dismissal of Employees

By its own admission, Saudia, while a foreign corporation, has a Philippine office. Section 3(d) of Republic Act No. 7042, otherwise known as the Foreign Investments Act of 1991, provides that the phrase “doing business” shall include . . . opening offices, whether called “liaison” offices or branches.

A plain application of Section 3(d) of the Foreign Investments Act leads to no other conclusion than that Saudia is a foreign corporation doing business in the Philippines. As such, Saudia may be sued in the Philippines and is subject to the jurisdiction of Philippine tribunals. Moreover, since there is no real distinction between “Saudia Jeddah” and “Saudia Manila” — the latter being nothing more than Saudia’s local office — service of summons to Saudia’s office in Manila sufficed to vest jurisdiction over Saudia’s person in Philippine tribunals.

In Bilbao vs. Saudi Arabian Airlines, the court defined voluntary resignation as “the voluntary act of an employee who is in a situation where one believes that personal reasons cannot be sacrificed in favor of the exigency of the service, and one has no other choice but to dissociate oneself from employment. It is a formal pronouncement or relinquishment of an office, with the intention of relinquishing the office accompanied by the act of relinquishment.” Thus, essential to the act of resignation is voluntariness. It must be the result of an employee’s exercise of his or her own will.

As the intent to relinquish must concur with the overt act of relinquishment, the acts of the employee before and after the alleged resignation must be considered in determining whether he or she, in fact, intended to sever his or her employment.

On the other hand, constructive dismissal has been defined as “cessation of work because ‘continued employment is rendered impossible, unreasonable or unlikely, as an offer involving a demotion in rank or a diminution in pay’ and other benefits.

In Penaflor vs. Outdoor Clothing Manufacturing Corporation, constructive dismissal has been described as tantamount to “involuntarily [sic] resignation due to the harsh, hostile, and unfavorable conditions set by the employer.

Applying the cited standards on resignation and constructive dismissal, it is clear that respondents were constructively dismissed. Hence, their termination was illegal.

The termination of respondents’ employment happened when they were pregnant and expecting to incur costs on account of child delivery and infant rearing. It is clear that respondents intended to remain employed with Saudia. All they did was avail of their maternity leaves. Evidently, the very nature of a maternity leave means that a pregnant employee will not report for work only temporarily and that she will resume the performance of her duties as soon as the leave allowance expires. It is also clear that respondents exerted all efforts to remain employed with Saudia. Each of them repeatedly filed appeal letters.

Respondents also adduced a copy of the “Unified Employment Contract for Female Cabin Attendants.” This contract deemed void the employment of a flight attendant who becomes pregnant and threatened termination due to lack of medical fitness. The threat of termination (and the forfeiture of benefits that it entailed) is enough to compel a reasonable person in respondents’ position to give up his or her employment.

The resignation letters are proof of how any supposed resignation did not arise from respondents’ own initiative. Respondents’ resignations were executed on Saudia’s blank letterheads that Saudia had provided. These letterheads already had the word “RESIGNATION” typed on the subject portion of their respective headings when these were handed to respondents.

Saudia makes much of how respondents supposedly completed their exit interviews, executed quitclaims, received their separation pay, and took more than a year to file their Complaint. If at all, however, these circumstances prove only the fact of their occurrence, nothing more. The voluntariness of respondents’ departure from Saudia is non sequitur.

Mere compliance with standard procedures or processes, such as the completion of their exit interviews, neither negates compulsion nor indicates voluntariness.