ST. LUKES MEDICAL CENTER, INC.

and ROBERT KUAN, Chairman, ESTRELITO NOTARIO

Facts: St. Lukes employed respondent as In-House Security Guard. Nimaya Electro Corporation
installed a CCTV in petitioner’s premises conducted an orientation seminar for the in-house
security personnel on the proper way of monitoring video cameras.

Respondent was on duty from 6:00 p.m. to 6:00 a.m. of December 31, 1996. His work consisted
mainly of monitoring the video cameras. In the evening of December 30, Justin Tibon, a foreigner
from Majuro, Marshall Island, then attending to his 3-year-old daughter, reported to the
management of petitioner about the loss of his mint green traveling bag, Continental Airlines
tickets, passports, and some clothes. Acting on the complaint of Tibon, the Security Department of
petitioner hospital conducted an investigation. When the tapes of video camera recorders covering
the subject period were reviewed, it was shown that the cameras failed to record any incident of
theft at room 257.

Petitioner issued a Memorandum to respondent directing him to explain in writing, within 24 hours
upon receipt thereof, why no disciplinary action should be taken against him for violating the
normal rotation/sequencing process of the VCR and, consequently, failed to capture the theft of
Tibon's traveling bag at room 257.

Respondent explained that on the subject dates, he was the only personnel on duty as nobody
wanted to assist him. Because of this, he decided to focus the cameras on the Old and New
Maternity Units, as these two units have high incidence of crime.

Finding respondent’s explanation unsatisfactory, petitioner served on respondent a copy of the

Respondent filed a Complaint for illegal dismissal against petitioner hospital seeking reinstatement
with payment of full backwages from the time of his dismissal up to actual reinstatement, without
of loss of seniority rights and other benefits.

Petitioners countered that they validly dismissed respondent for gross negligence and observed
due process before terminating his employment.

The Labor Arbiter dismissed respondent’s complaint. He stated that respondent’s infraction
exposed petitioners to the possibility of a damage suit that may be filed against them arising from
the theft.

The NLRC issued a Resolution, reversing the Decision of the Labor Arbiter. Petitioners failed to
submit proof that there was an existing Standard Operating Procedure (SOP) in the CCTV
monitoring system, particularly on the focusing procedure. It observed that respondent was not
negligent when he focused the cameras on the Old and New Maternity Units, as they were located
near the stairways and elevators, which were frequented by many visitors and, thus, there is the
likelihood that untoward incidents may arise. If at all, it treated the matter as a single or isolated
act of simple negligence which did not constitute a just cause for the dismissal of an employee.
Petitioners filed a Motion for Reconsideration, but the same was denied by the NLRC.

The CA afirmed the NLRCs finding that while respondent may appear to be negligent in monitoring
the cameras on the subject dates, the same would not constitute sufficient ground to terminate his
employment. 
Hence, this petition.

Issue: Whether or not respondent was illegally dismissed.

Ruling: Respondent was illegally dismissed without just cause and compliance with the notice
requirement.

Article 282 (b) of the Labor Code provides that an employer may terminate an employment for
gross and habitual neglect by the employee of his duties. Corollarily, regarding termination of
employment, Section 2(a) and (d), Rule 1, Book VI of the Omnibus Rules Implementing the Labor
Code, as amended, provides that:

Section 2. Security of Tenure. (a) In cases of regular employment, the employer shall not
terminate the services of an employee except for just or authorized causes as provided by law,
and subject to the requirements of due process.

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(d) In all cases of termination of employment, the following standards of due process shall be
substantially observed:

For termination of employment based on just causes as defined in Article 282 of the Labor Code:

(i) A written notice served on the employee specifying the ground or grounds for termination,
and giving said employee reasonable opportunity within which to explain his side.

(ii) A hearing or conference during which the employee concerned, with the assistance of
counsel if he so desires is given opportunity to respond to the charge, present his evidence, or
rebut the evidence presented against him.

(iii) A written notice of termination served on the employee, indicating that upon due
consideration of all the circumstances, grounds have been established to justify his termination.

xxxx

For a valid dismissal of an employee, the Labor Code has set twin requirements, namely: 

1. (substantive) the dismissal must be for any of the causes provided in Article 282 of the
Labor Code; and
2. (procedural) the employee must be given an opportunity to be heard and defend
himself. This first requisite is referred to as the substantive aspect, while the second is
deemed as the procedural aspect.

 An employer can terminate the services of an employee only for valid and just causes
which must be supported by clear and convincing evidence. The employer has the burden of
proving that the dismissal was indeed for a valid and just cause.

A perusal of petitioner hospitals CCTV Monitoring Guidelines,  disseminated to all in-house

 
This fact is corroborated by, petitioners' former In-House Security Department Head, in his
Affidavit. 

Further, the Certification issued by Himaya Electro Corporation, indicating respondent as one of
the participants in the orientation conducted for in-house security personnel contradicted the joint
statement, by therein participants, which excluded respondent as one of the attendees. Thus, the
certification cannot support petitioner’s theory that respondent ought to know the rudiments of
monitoring the CCTV cameras on the basis that he was one of the participants in the said
orientation. 

Under Article 282 (b) of the Labor Code, an employer may terminate an employee for gross
and habitual neglect of duties.   Neglect of duty, to be a ground for dismissal, must be
both gross and habitual. Gross negligence connotes want of care in the performance of one’s
duties. Habitual neglect implies repeated failure to perform one’s duties for a period of time,
depending upon the circumstances. A single or isolated act of negligence does not constitute
a just cause for the dismissal of the employee. Under the prevailing circumstances, respondent
exercised his best judgment in monitoring the CCTV cameras so as to ensure the security within
the hospital premises. Verily, assuming arguendo that respondent was negligent, although this
Court finds otherwise, the lapse or inaction could only be regarded as a single or isolated act of
negligence that cannot be categorized as habitual and, hence, not a just cause for  his dismissal.

Petitioners question the findings of the CA that there was no compliance with the twin-
notice rule and hearing, while respondent maintains that they violated his right to due
process.

The employee must be furnished two written notices: the first notice apprises the employee of
the particular acts or omissions for which his dismissal is sought, and the second is a subsequent
notice, which informs the employee of the employer's decision to dismiss him.

Petitioner hospital failed to comply with the rule on twin notice and hearing as it merely required
respondent to give his written explanation within 24 hours and, thereafter, ordered his dismissal.

Where the dismissal was without just cause and there was no due process, Article 279 of the
Labor Code, as amended, mandates that the employee is entitled to reinstatement without
loss of seniority rights and other privileges and full backwages, inclusive of allowances
and other benefits, or their monetary equivalent computed from the time the compensation
was not paid up to the time of actual reinstatement.

The awards of separation pay and backwages are not mutually exclusive and both may be given
to respondent. An employee who is illegally dismissed is entitled to the twin reliefs of full
backwages and reinstatement. If reinstatement is not viable, separation pay is awarded to
the employee. In awarding separation pay to an illegally dismissed employee, in lieu of
reinstatement, the amount to be awarded shall be equivalent to one-month salary for every
year of service.

Petitioner’s lack of just cause and non-compliance with the procedural requisites in
terminating respondents employment renders them guilty of illegal dismissal. Consequently,
respondent is entitled to reinstatement to his former position without loss of seniority rights and
payment of backwages. However, if such reinstatement proves impracticable, and hardly in the
best interest of the parties, perhaps due to the lapse of time since his dismissal, or if he decides
not to be reinstated, respondent should be awarded separation pay in lieu of reinstatement.