[G.R. No. 243259. January 10, 2023.

PATRICIA HALAGUEÑA, MA. ANGELITA L. PULIDO, MA. TERESITA P. SANTIAGO, MARIANNE

V. KATINDIG, BERNADETTA A. CABALQUINTO, LORNA B. TUGAS, MARY CHRISTINE A.
VILLARETE, CYNTHIA A. STEHMEIER, ROSE ANA G. VICTA, NOEMI R. CRESENCIO and other
female flight attendants of PHILIPPINE AIRLINES, petitioners, vs. PHILIPPINE AIRLINES, INC.,
respondent.

DECISION
LEONEN, J p:

A stipulation in the Collective Bargaining Agreement providing for the compulsory retirement of female cabin
attendants at 55 years old and male cabin attendants at 60 years old, lacks basis, discriminates against women,
and is void for being contrary to law and public policy. HTcADC

This Court resolves the Petition for Review on Certiorari [1] assailing the May 31, 2018 Decision [2] and
November 19, 2018 Resolution [3] of the Court of Appeals which reversed and set aside the May 22, 2015
Decision [4] and October 9, 2015 Resolution [5] of the Regional Trial Court.

Patricia Halagueña, Ma. Angelita L. Pulido, Ma. Teresita P. Santiago, Marianne [6] V. Katindig, Bernadetta [7]
A. Cabalquinto, Lorna B. Tugas, Mary Christine A. Villarete, Cynthia A. Stehmeier, [8] Rose Ana [9] G. Victa,
Noemi R. Cresencio and other female flight attendants of Philippine Airlines, Inc. (collectively, Halagueña, et
al.) are members of Flight Attendants and Stewards Association of the Philippines (FASAP). It is the sole and
exclusive bargaining representative of Philippine Airlines, Inc. (PAL) flight attendants, stewards, and pursers
hired on different dates prior to November 22, 1996. [10]

On July 11, 2001, PAL and FASAP entered into a Collective Bargaining Agreement (CBA) incorporating the
terms and conditions of employment of cabin attendants for the years 2000 to 2005 (PAL-FASAP 2000-2005
CBA). [11]

On July 29, 2004, Halagueña, et al. filed a Petition for Declaratory Relief with Prayer for Issuance of
Temporary Restraining Order and Writ of Preliminary Injunction with the Regional Trial Court of Makati City,
Branch 147, [12] enjoining PAL from enforcing Section 144 (A) [13] of the PAL-FASAP 2000-2005 CBA.
They sought the nullity of Section 144 (A) for discriminating against female flight attendants in violation of the
Constitution, the Labor Code, and the Convention on the Elimination of All Forms of Discrimination Against
Women. [14] CAIHTE

PAL initially claimed that the Regional Trial Court lacked jurisdiction as the petition is a labor case disguised as
a special civil action. However, the Regional Trial Court dismissed this claim in an August 9, 2004 Order and
upheld its jurisdiction. [15]

On August 10, 2004, the Regional Trial Court issued a temporary restraining order and ordered PAL to restore
the status quo of Bernadetta A. Cabalquinto (Cabalquinto) who will be affected by the implementation of the
provision. PAL heeded this and did not retire Calbaquinto but put her on an "off-flight flight" status. On
September 27, 2004 the trial court granted the prayer for injunction. [16]

Their motion for reconsideration having been denied, PAL filed a Petition for Certiorari with Prayer for the
Issuance of a Temporary Restraining Order and/or Writ of Preliminary Injunction before the Court of Appeals.
[17]

In an August 31, 2005 Decision, the Court of Appeals ruled in favor of PAL and declared that the trial court had
no jurisdiction over the petition for declaratory relief, consequently annulling and setting aside all the
proceedings, orders, and processes before it. [18] In a March 7, 2007 Resolution, the Court of Appeals denied
the motion for reconsideration filed by Halagueña, et al. prompting them to file an appeal with the Supreme
Court, and causing the case before the trial court to be archived. [19]

In Halagueña, et al. v. Philippine Airlines, Inc., [20] docketed as G.R. No. 172013 and promulgated on October
2, 2009, this Court, through the Third Division, reversed and set aside the Court of Appeals' decision and
directed the Regional Trial Court of Makati City, Branch 147 to continue the proceedings in Civil Case No. 04-
886 with deliberate dispatch. There, this Court held that the jurisdiction to determine whether Section 144 (A)
of the PAL-FASAP 2000-2005 CBA is discriminatory, and whether it violates the Constitution, statutes, and
treaties, was properly lodged with the Regional Trial Court.

1
Accordingly, Halagueña, et al. moved for the revival of the archived case before the trial court and for the
issuance of a writ of preliminary injunction. However, the trial court held in abeyance any further proceedings
until the decision of the Supreme Court in G.R. No. 172013 attained finality. After PAL's Motion for
Reconsideration was denied with finality, the trial court, in a February 18, 2010 Order, granted Halagueña, et
al.'s Motion to Revive with Urgent Motion for the Issuance of the Writ of Preliminary Injunction. [21]

On March 8, 2010, the trial court denied the Motion for Status Quo Order filed by Halagueña, et al. [22]
However, on July 19, 2010, it granted the application for the issuance of a writ of preliminary injunction which
was issued on July 30, 2010. [23] aScITE

Halagueña, et al. thereafter filed a Motion for Partial Reconsideration praying that the cabin attendants affected
by the questioned compulsory retirement provision be reinstated and given flight schedules. They also filed a
Supplemental Motion listing names of retired cabin attendants and praying for their reinstatement. PAL filed its
opposition to the said Motions which Halagueña, et al. countered with a Reply. [24]

In its December 2, 2010 Order, the trial court granted the lifting of the writ of preliminary injunction subject to
PAL's posting of a bond and denied the motions filed by Halagueña, et al. for lack of merit. [25]

In subsequent Orders, the trial court approved the counter bond posted by PAL and ordered the lifting and
setting aside of the writ of preliminary injunction. [26]

In its May 22, 2015 Decision, the trial court granted the petition for declaratory relief and declared Section 144
(A) of the PAL-FASAP 2000-2005 CBA null and void for being discriminatory. The dispositive portion of
which reads:

WHEREFORE, premises considered, the "Petition for Declaratory Relief with Prayer for Issuance of
Temporary Restraining Order [and] Writ for Preliminary Injunction" is hereby GRANTED. Judgment is hereby
rendered in favor of petitioners Patricia Halagueña, Ma. Angelita L. Pulido, Ma. Teresita P. Santiago, Marianne
V. Katindig, Bernadette A. Cabalquinto, Lorna B. Tugas, Mary Christine A. Villarte, Cythia A. Stehmeier, Rose
Ana G. Victa, Noemi R. Cersencio and other female flight attendants of Philippine Airlines and against
respondent Philippine Airlines, Inc., as follows:

a. Declaring Section 144 of the PAL-FASAL 200[0]-2005 CBA provision null and void for being
discriminatory;
b. Ordering respondent PAL to pay petitioners the following sums:
1. Php100,000.00 for each of the petitioners in this case; and
2. Php200,000.00 as Attorney's Fees.
c. Pay the cost of the suit.

SO ORDERED. [27] (Emphasis in the original)

In ruling favorably for Halagueña, et al., the trial court held that Section 144 (A) of the PAL-FASAP 2000-2005
CBA violates the Constitution, the Labor Code, and the Convention on the Elimination of all Forms of
Discrimination against Women for being discriminatory against women flight attendants. [28] The trial court
ruled that Halagueña, et al.'s rights cannot be bargained away and found that PAL failed to show any difference
between male and female cabin attendants which would justify the implementation of the assailed provision.
[29] In addition, the trial court held that the petition for declaratory relief was properly filed as all its requisites
were present in the case. [30] Furthermore, the trial court found that Halagueña, et al. are entitled to the award
of moral damages and attorney's fees. [31]

In its October 9, 2015 Resolution, the trial court denied the Motion for Reconsideration filed by PAL for utter
lack of merit. [32] DETACa

In a May 31, 2018 Decision, the Court of Appeals reversed and set aside the decision of the Regional Trial
Court, and ruled in favor of PAL, to wit:

WHEREFORE, in view of the foregoing disquisitions, the instant appeal is GRANTED. The Decision dated
22 May 2015 and Resolution dated 9 October 2015 of the Regional Trial Court of Makati City, Branch 59 in
Civil Case No. 04-886 are hereby REVERSED and SET ASIDE. A new one is hereby issued declaring Section
144 of the PAL-FASAP 2000-2005 CBA provision VALID and BINDING. Accordingly, the Petition for
Declaratory Relief is DISMISSED.

SO ORDERED. [33] (Emphasis in the original)

2
After considering the paramount importance of the issue involved, the Court of Appeals relaxed its procedural
rules and ruled on the merits despite the belated filing of PAL's appellant's brief. [34] The Court of Appeals
ruled that since FASAP voluntarily assented to the questioned provision, there is a reasonable presumption that
it is beneficial and acceptable to its members and that the members agree to abide by its provisions. [35]
Moreover, it found that, historically, there has always been a difference in the compulsory retirement age for
male and female flight attendants which was mutually agreed upon by PAL and FASAP. [36] The Court of
Appeals ruled that the questioned provision is a valid and binding undertaking, as there was nothing illegal in
the retirement clause warranting its nullification. [37] It likewise held that Halagueña, et al. failed to prove with
competent evidence that the assailed provision is void and discriminatory or that they were coerced to ratify the
PAL-FASAP 2000-2005 CBA. [38]

In a November 19, 2018 Resolution, the Court of Appeals denied the Motion for Reconsideration filed by
Halagueña, et al. for lack of merit. [39]

Thus, petitioners filed the present Petition for Review on Certiorari on January 11, 2019, [40] claiming they
were able to prove through various documentary and testimonial evidence that Section 144 (A) of the PAL-
FASAP 2000-2005 CBA is discriminatory against female flight attendants. [41]

Petitioners allege that respondent failed to show any difference between male and female cabin attendants either
in qualification or function so as to justify the adoption of the assailed provision, and that they cannot
comprehend the rationale for such distinction. Contrary to respondent's insistence that the PAL-FASAP 2000-
2005 CBA has been duly agreed upon, they argue that their right against discrimination cannot be bargained
away by their male-denominated union representatives, who failed to protect their interests and even testified
against them. [42] Petitioners allege that since Section 144 (A) is contrary to law and public policy, it is void
and cannot be ratified under Article 1409 of the Civil Code, despite it being the practice of the company ever
since. [43] Petitioners claim that respondent is estopped from upholding the validity of the assailed provision
considering that the PAL-FASAP 2000-2005 CBA itself has a non-discriminatory clause. Lastly, they claim that
they are not estopped from assailing the provision just because they received their retirement benefits when they
were, in fact, forced to retire. [44] HEITAD

In its Comment, [45] respondent argues that Section 144 (A) of the PAL FASAP 2000-2005 CBA complies with
the Labor Code and is not discriminatory against women, since female flight attendants belong to a special class
of occupation requiring special standards for retirement. [46] Respondent claims that the retirement provision
was validly negotiated by the parties, voluntarily agreed upon, and ratified by FASAP members. [47]
Respondent posits that the assailed provision did not contain any legal infirmity, and has been repeatedly
adopted and carried over in succeeding CBAs. [48] Further, respondent claims that petitioners are estopped
from questioning the validity of the retirement provision as they accepted its reasonableness when it was carried
over in succeeding renewals of the CBA. [49]

Petitioners manifested that they are adopting their petition as their reply to the comment, [50] which the Court
noted in a November 11, 2020 Resolution.

The sole issue for this Court's resolution is whether Section 144 (A) of the 2000-2005 PAL-FASAP CBA is
discriminatory against women, and thus void for being contrary to the Constitution, laws, and international
conventions.

This Court grants the Petition.

While the issue of whether Section 144 (A) is discriminatory is a question of fact [51] generally not cognizable
in a Rule 45 petition, [52] factual findings by the lower courts — which are usually binding and conclusive —
may be reviewed in exceptional cases, [53] such as in this case where the findings of the Court of Appeals are
contrary to those of the Regional Trial Court.

I
Retirement has been consistently defined as "the result of a bilateral act of the parties, a voluntary agreement
between the employer and the employee whereby the latter, after reaching a certain age, agrees to sever his or
her employment with the former." [54] There are three types of retirement plans available to an employee: first
is compulsory and contributory, which is provided for in Republic Act No. 8282 [55] for those in the private
sector and Republic Act No. 8291 [56] for those in the government; second is that voluntarily agreed upon
between the employer and the employees in collective bargaining agreements or other agreements between
them; and third is that voluntarily given by the employer, expressly as announced in company policies or
impliedly as in a failure to contest the employee's claim for retirement benefits. [57]
3
The second and third types of retirement are governed by Article 302 of the Labor Code: aDSIHc

ARTICLE 302. [287] Retirement. — Any employee may be retired upon reaching the retirement age established
in the collective bargaining agreement or other applicable employment contract.

In case of retirement, the employee shall be entitled to receive such retirement benefits as he may have carried
under existing laws and any collective bargaining agreement and other agreements: Provided, however, That an
employee's retirement benefits under any collective bargaining and other agreements shall not be less than those
provided therein.

In the absence of a retirement plan or agreement providing for retirement benefits of employees in the
establishment, an employee upon reaching the age of sixty (60) years or more, but not beyond sixty-five (65)
years which is hereby declared the compulsory retirement age, who has served at least five (5) years in the said
establishment, may retire and shall be entitled to retirement pay equivalent to at least one-half (1/2) month
salary for every year of service, a fraction of at least six (6) months being considered as one whole year.

Article 302 [287] of the Labor Code allows employers and employees to establish an early retirement age
option mutually agreed upon by them:

Acceptance by the employees of an early retirement age option must be explicit, voluntary, free, and
uncompelled. While an employer may unilaterally retire an employee earlier than the legally permissible ages
under the Labor Code, this prerogative must be exercised pursuant to a mutually instituted early retirement plan.
In other words, only the implementation and execution of the option may be unilateral, but not the adoption and
institution of the retirement plan containing such option. For the option to be valid, the retirement plan
containing it must be voluntarily assented to by the employees or at least by a majority of them through a
bargaining representative. [58]

This Court has upheld various retirement plans setting the retirement age lower than the compulsory or optional
retirement age provided in the Labor Code upon meeting certain requirements as contained in a CBA or in an
employment contract or agreement between the employer and employees. [59] The rationale behind this was
discussed in Pantranco North Express, Inc. v. National Labor Relations Commission: [60]

In almost all countries today, early retirement, i.e., before age 60, is considered a reward for services rendered
since it enables an employee to reap the fruits of his labor — particularly retirement benefits, whether lump-sum
or otherwise — at an earlier age, when said employee, in presumably better physical and mental condition, can
enjoy them better and longer. As a matter of fact, one of the advantages of early retirement is that the
corresponding retirement benefits, usually consisting of a substantial cash windfall, can early on be put to
productive and profitable uses by way of income-generating investments, thereby affording a more significant
measure of financial security and independence for the retiree who, up till then, had to contend with life's
vicissitudes within the parameters of his fortnightly or weekly wages. Thus we are now seeing many CBAs with
such early retirement provisions. And the same cannot be considered a diminution of employment benefits. [61]
ATICcS

However, it must be emphasized that the option to retire below the ages provided by law must be assented to
and accepted by the employee, or it will be an adhesive imposition resulting in deprivation of property without
due process of law. [62] In Barroga v. Quezon Colleges, [63] this Court held that the core premise of retirement
is being a voluntary agreement and an involuntary retirement amounts to discharge:

[T]he main feature of retirement is that it is the result of a bilateral act of both the employer and the employee
based on their voluntary agreement that upon reaching a certain age, the employee agrees to sever his
employment. Since the core premise of retirement is that it is a voluntary agreement, it necessarily follows that
if the intent to retire is not clearly established or if the retirement is involuntary, it is to be treated as a discharge.

The line between "voluntary" and "involuntary" retirement is thin but it is one which case law had already
drawn. On the one hand, voluntary retirement cuts the employment ties leaving no residual employer liability;
on the other, involuntary retirement amounts to a discharge, rendering the employer liable for termination
without cause. The employee's intent is decisive. In determining such intent, the relevant parameters to consider
are the fairness of the process governing the retirement decision, the payment of stipulated benefits, and the
absence of badges of intimidation or coercion. [64] (Citations omitted)

Furthermore, a stipulation, clause, term, or condition in the CBA if contrary to law, morals, good customs,
public order, or public policy is void. [65] Even if the retirement provision is embodied in the CBA, it may still
be voided if contrary to law, good customs, public order, or public policy, thus:

4
It should not be taken to mean that retirement provisions agreed upon in the CBA are absolutely beyond the
ambit of judicial review and nullification. A CBA, as a labor contract, is not merely contractual in nature but
impressed with public interest. If the retirement provisions in the CBA run contrary to law, public morals, or
public policy, such provisions may very well be voided. Certainly, a CBA provision or employment contract
that would allow management to subvert security of tenure and allow it to unilaterally "retire" employees after
one month of service cannot be upheld. Neither will the Court sustain a retirement clause that entitles the
retiring employee to benefits less than what is guaranteed under Article 287 of the Labor Code, pursuant to the
provision's express proviso thereto in the provision. [66]

Article 1700 of the Civil Code provides that "[t]he relation between capital and labor are not merely contractual.
They are so impressed with public interest that labor contracts must yield to the common good." As labor
contracts are impressed with public interest, a CBA must be construed liberally, and the courts must give due
consideration to "the context in which it is negotiated and purpose which it is intended to serve." [67] Any
doubts should be resolved in favor of labor [68] and in favor of the retiree to achieve its humanitarian purposes.
[69] ETHIDa

In the 2009 case of Halagueña v. Philippines Airlines, Inc. [70] involving the same parties, this Court
emphasized that although the CBA is the law between the parties, its provisions on retirement may still be
voided if it is contrary to law, public morals, or public policy:

Although it is a rule that a contract freely entered between the parties should be respected, since a contract is the
law between the parties, said rule is not absolute.
In Pakistan International Airlines Corporation v. Ople, this Court held that:

The principle of party autonomy in contracts is not, however, an absolute principle. The rule in Article 1306, of
our Civil Code is that the contracting parties may establish such stipulations as they may deem convenient,
"provided they are not contrary to law, morals, good customs, public order or public policy." Thus, counter-
balancing the principle of autonomy of contracting parties is the equally general rule that provisions of
applicable law, especially provisions relating to matters affected with public policy, are deemed written into the
contract. Put a little differently, the governing principle is that parties may not contract away applicable
provisions of law especially peremptory provisions dealing with matters heavily impressed with public interest.
The law relating to labor and employment is clearly such an area and parties are not at liberty to insulate
themselves and their relationships from the impact of labor laws and regulations by simply contracting with
each other.

Moreover, the relations between capital and labor are not merely contractual. They are so impressed with public
interest that labor contracts must yield to the common good[.] The supremacy of the law over contracts is
explained by the fact that labor contracts are not ordinary contracts; these are imbued with public interest and
therefore are subject to the police power of the state. It should not be taken to mean that retirement provisions
agreed upon in the CBA are absolutely beyond the ambit of judicial review and nullification. A CBA, as a
labor contract, is not merely contractual in nature but impressed with public interest. If the retirement
provisions in the CBA run contrary to law, public morals, or public policy, such provisions may very well be
voided. [71] (Emphasis supplied, citations omitted)

Petitioners now pursue their main case before this Court, assailing the compulsory retirement provision found in
Section 144 (A) of the PAL-FASAP 2000-2005 CBA as void for being contrary to law and public policy and for
discriminating against women flight attendants. It provides: TIADCc
Section 144 Retirement Benefits. —

A. For the Cabin Attendants hired before 22 November 1996:

1. Early Retirement

Any Cabin Attendant who has completed at least two (2) years of continuous service may opt to retire and when
so retired, he shall be entitled to one and one-half (1 1/2) months' salary for every year of completed service as
retirement pay.

2. Optional Retirement

Any Cabin Attendant may retire at his option upon reaching the age fifty (50) for females or age fifty-five (55)
for males and when so retired, the Cabin Attendant shall be entitled as retirement pay equivalent to:

5
a. One and one-half (1 1/2) month's basic salary for every year of completed service based on their basic
monthly salaries upon reaching the age fifty (50) for females or fifty-five (55) for males;

b. Plus one-half (1/2) month's basic salary for every year of completed service based on their final monthly
basic salary for the year of services rendered after reaching the age of fifty (50) for females or age fifty-five (55)
for males.

[Formula:

Retirement Pay = 1.5 months basic salary at age 50 female (or 55 male) x completed years of service, plus
.5 months basic salary x completed years of service after age 50 female (or 55 male)]

3. Compulsory Retirement

Subject to the grooming standards provisions of this Agreement, compulsory retirement shall be fifty-five (55)
for females and sixty (60) for males. Retirements pay for compulsory retirement shall be: cSEDTC

a. One and one-half (1 1/2) month's basic salary for every year of service based on their basic salaries upon
reaching the age of fifty (50) for females or fifty-five (55) for males.

b. Plus one-half (1/2) month's basic salary for every year of service based on their final monthly basic salary for
the year of services rendered after reaching the age of fifty (50) for females or age fifty-five (55) for males.

[Formula:

Retirement Pay = 1.5 months basic salary at age 50 female (or 55 male) x completed years of service, plus
.5 months basic salary x years of service after age 50 female (or 55 male)] [72]

II
In finding merit in the Petition, we emphasize that the fundamental equality of women and men before the law
is enshrined and guaranteed by the Constitution, statutes, and international convention where the Philippines is
a signatory. [73]

Article II, Section 14 of the 1987 Constitution mandates the State to actively "ensure the fundamental equality
before the law of women and men." Unlike the equal protection provision under Article III, Section 1, Article II,
Section 14 requires the State to actively engage and promote gender equality, thus:

Article II, Section 14 of the 1987 Constitution provides that "[t]he State . . . shall ensure the fundamental
equality before the law or women and men." Contrasted with Article II, Section 1 of the 1987 Constitution's
statement that "[n]o person shall . . . be denied the equal protection of the laws," Article II, Section 14 exhorts
the State to "ensure." This does not only mean that the Philippines shall not countenance nor lend legal
recognition and approbation to measures that discriminate on the basis of one's being male or female. It imposes
an obligation to actively engage in securing the fundamental equality of men and women. [74]

Meanwhile, Article XIII, Section 14 commands the State to protect working women through providing
opportunities that will enable them to reach their full potential. The Labor Code affirms the State's basic policy
to "ensure equal work opportunities regardless of sex" [75] and expressly prohibits an employer from
discriminating against women employees solely based on sex:

ARTICLE 133. [135] [76] Discrimination Prohibited. — It shall be unlawful for any employer to discriminate
against any woman employee with respect to terms and conditions of employment solely on account of her sex.

The following are acts of discrimination: AIDSTE

(a) Payment of a lesser compensation, including wage, salary or other form of remuneration and fringe benefits,
to a female employee as against a male employee, for work of equal value; and

(b) Favoring a male employee over a female employee with respect to promotion, training opportunities, study
and scholarship grants solely on account of their sexes.

Criminal liability for the willful commission of any unlawful act as provided in this article or any violation of
the rules and regulations issued pursuant to Section 2 hereof shall be penalized as provided in Articles 288 and
289 of this Code: Provided, That the institution of any criminal action under this provision shall not bar the
aggrieved employee from filing an entirely separate and distinct action for money claims, which may include
claims for damages and other affirmative reliefs. The actions hereby authorized shall proceed independently of
each other.

6
The Convention on the Elimination of all Forms of Discrimination against Women (CEDAW), which the
Philippines signed on July 15, 1980 and ratified on August 5, 1981, further realizes this policy to ensure
fundamental equality between men and women. [77] In this Convention, "discrimination against women" is
defined as:

. . . any distinction, exclusion or restriction made on the basis of sex which has the effect or purpose of
impairing or nullifying the recognition, enjoyment or exercise by women, irrespective of their marital status, on
a basis of equality of men and women, of human rights and fundamental freedoms in the political, economic,
social, cultural, civil or any other field. [78]

In the field of employment, Article 11 (1) of the CEDAW further provides:

1. States Parties shall take all appropriate measures to eliminate discrimination against women in the field of
employment in order to ensure, on a basis of equality of men and women, the same rights, in particular:

(a) The right to work as an inalienable right of all human beings;

(b) The right to the same employment opportunities, including the application of the same criteria for selection
in matters of employment;

(c) The right to free choice of profession and employment, the right to promotion, job security and all benefits
and conditions of service and the right to receive vocational training and retraining, including apprenticeships,
advanced vocational training and recurrent training;

(d) The right to equal remuneration, including benefits, and to equal treatment in respect of work of equal value,
as well as equality of treatment in the evaluation of the quality of work;

(e) The right to social security, particularly in cases of retirement, unemployment, sickness, invalidity and old
age and other incapacity to work, as well as the right to paid leave; SDAaTC

(f) The right to protection of health and to safety in working conditions, including the safeguarding of the
function of reproduction.

In 2009, the legislature enacted Republic Act No. 9710 or the Magna Carta of Women which compels the State
to "provide the necessary mechanisms to enforce women's rights and adopt and undertake all legal measures
necessary to foster and promote the equal opportunity for women to participate in and contribute to the
development of the political, economic, social, and cultural realms." [79] Discrimination against women has
also been defined as:

. . . any gender-based distinction, exclusion, or restriction which has the effect or purpose of impairing or
nullifying the recognition, enjoyment, or exercise by women, irrespective of their marital status, on a basis of
equality of men and women, of human rights and fundamental freedoms in the political, economic, social,
cultural, civil, or any other field.

It includes any act or omission, including by law, policy, administrative measure, or practice, that directly or
indirectly excludes or restricts women in the recognition and promotion of their rights and their access to and
enjoyment of opportunities, benefits, or privileges.

A measure or practice of general application is discrimination against women if it fails to provide for
mechanisms to offset or address sex or gender-based disadvantages or limitations of women, as a result of
which women are denied or restricted in the recognition and protection of their rights and in their access to and
enjoyment of opportunities, benefits, or privileges; or women, more than men, are shown to have suffered the
greater adverse effects of those measures or practices.

Provided, finally, that discrimination compounded by or intersecting with other grounds, status, or condition,
such as ethnicity, age, poverty, or religion shall be considered discrimination against women under this Act. [80]

In Saudi Arabian Airlines (Saudia) v. Rebesencio, [81] we found discriminatory Saudia's policy which
terminates the employment of flight attendants who become pregnant, and compelled all personalities acting on
behalf of the State, including this Court, to act pursuant to the constitutional exhortation "to ensure that no
discrimination is heaped upon women on the mere basis of their being women[,]" thus:

The constitutional exhortation to ensure fundamental equality, as illumined by its enabling law, the CEDAW,
must inform and animate all the actions of all personalities acting on behalf of the State. It is, therefore, the
bounden duty of this court, in rendering judgment on the disputes brought before it, to ensure that no
discrimination is heaped upon women on the mere basis of their being women. This is a point so basic and
7
central that all our discussions and pronouncements — regardless of whatever averments there may be of
foreign law — must proceed from this premise. AaCTcI

So informed and animated, we emphasize the glaringly discriminatory nature of Saudia's policy. As argued by
respondents, Saudia's policy entails the termination of employment of flight attendants who become pregnant.
At the risk of stating the obvious, pregnancy is an occurrence that pertains specifically to women. Saudia's
policy excludes from and restricts employment on the basis of no other consideration but sex.

We do not lose sight of the reality that pregnancy does present physical limitations that may render difficult the
performance of functions associated with being a flight attendant. Nevertheless, it would be the height of
iniquity to view pregnancy as a disability so permanent and immutable that it must entail the termination of
one's employment. It is clear to us that any individual, regardless of gender, may be subject to exigencies that
limit the performance of functions. However, we fail to appreciate how pregnancy could be such an impairing
occurrence that it leaves no other recourse but the complete termination of the means through which a woman
earns a living. [82]

III
Considering the constitutional guarantee of protection to labor and security of tenure, [83] an employer must
convincingly establish, through substantial evidence, that there is a valid and just cause to terminate the
employment of an employee. [84]

Substantial evidence, which is the quantum of proof required in labor cases, require "such relevant evidence as a
reasonable mind might accept as adequate to support a conclusion." [85] In Dela Cruz-Cagampan v. One
Network Bank, Inc., [86] this Court found One Network Bank's no-spouse employment policy as discriminatory,
since it failed to prove with substantial evidence the factual basis and reasonable business necessity for its
policy.

The trial court ruled that respondent failed to prove any difference between male and female cabin attendants
which justifies the implementation of the assailed provision. [87] On the other hand, the Court of Appeals
justified the difference in the compulsory retirement age for male and female cabin attendants as follows:

In this regard, the CBA provision on early retirement for female flight attendants must be viewed in the
context of PAL's obligation to guarantee the safety of its passengers taking into account the obvious
biological difference between male and female. It must be remembered that the task of a cabin crew or flight
attendant is not limited to serving meals or attending to the whims and caprices of the passengers. The most
important activity of the cabin crew is to care for the safety of passengers and the evacuation of the aircraft
when an emergency occurs. Passenger safety goes to the core of the job of a cabin attendant. Truly, airlines
need cabin attendants who have the necessary strength to open emergency doors, the agility to attend to
passengers in cramped working conditions, and the stamina to withstand grueling flight schedules. acEHCD

In addition, it bears emphasis that providing an early retirement age for female flight attendants does not
necessarily place them at a great disadvantage. For one, early retirement creates a great window of opportunity
to make positive lifestyle changes and restore a well-balanced life. Here, petitioners-appellees will have more
time to spend with their families and friends as well as the opportunity to pursue activities and hobbies that they
may not have had the time to do in the past. Early retirement can also potentially improve their physical and
mental health, which in turn can help them live a longer and happier life.

As to the financial aspect, early retirement has been considered as a reward for services rendered since it
enables an employee to reap the fruits of his labor — particularly retirement benefits, whether lump-sum or
otherwise — at an earlier age, when said employee, in presumably better physical and mental condition, can
enjoy them better and longer. [88] (Emphasis supplied)

We agree with the trial court. Respondent was not able to provide any reasonable basis for differentiating the
compulsory retirement age for female cabin attendants at 55 years old and the male cabin attendants at 60 years
old.

The Court of Appeals' reasoning supports the view that the compulsory retirement age for female cabin
attendants was made lower than their male counterparts on the "mere basis of their being women." This is
discriminatory against women. There is no proof that female cabin attendants, between 55 to 59 years old, do
not have the "necessary strength to open emergency doors, the agility to attend to passengers in cramped
working conditions, and the stamina to withstand grueling flight schedules" as compared with their male

8
counterparts. The Court of Appeals' inference is manifestly mistaken and its conclusion grounded on
speculation, surmises, or conjectures.

As a State Party to the CEDAW, the Philippines, including the judiciary as a State instrumentality, bound itself
to take all appropriate measures "to modify the social and cultural patterns of conduct of men and women, with
a view to achieving the elimination of prejudices and customary and all other practices which are based on the
idea of the inferiority or the superiority of either of the sexes or on stereotyped roles for men and women." [89]

We hold that petitioners female cabin attendants were able to prove that the enforcement of Section 144 (A) of
the PAL-FASAP 2000-2005 CBA is discriminatory against them, and thus prohibited by the Constitution, laws,
and international conventions. EcTCAD

Petitioners substantiated that they were discriminated upon when they were forced to retire at 55 years old while
their male counterparts were compulsory retired at 60 years old. They were denied of the opportunity for
employment as they were retired at an age "not young enough to seek for a new job but not old enough to be
considered retired[.]" [90] They were further denied the benefits attached to employment, such as income and
medical benefits, five years earlier than their male counterpart, without any factual basis. [91] Thus, this
discrimination heaped upon them on the mere basis of their being women which is patently contrary to the
Constitution, laws, international conventions, and even their CBA itself, which provides that respondent
company should "maintain a policy of non-discrimination against any employee or Union member by reason of
race, color, sex, creed or political or religious beliefs or Union affiliation." [92]

Respondent claims that the Labor Code provides for the differential treatment of women especially for flight
attendants, specifically:

ARTICLE 130. [132] Facilities for Women. — The Secretary of Labor and Employment shall establish
standards that will ensure the safety and health of women employees. In appropriate cases, he shall, by
regulations, require any employer to:

(a) Provide seats proper for women and permit them to use such seats when they are free from work and during
working hours, provided they can perform their duties in this position without detriment to efficiency;

(b) To establish separate toilet rooms and lavatories for men and women and provide at least a dressing room for
women;

(c) To establish a nursery in a workplace for the benefit of the women employees therein; and

(d) To determine appropriate minimum age and other standards for retirement or termination in special
occupations such as those of flight attendants and the like. (Emphasis supplied)

However, this provision allows the Secretary of Labor, "by regulation," to require the employer to determine
"appropriate minimum age and other standards for retirement or termination in special occupations such as
those of flight attendants and the like" in "appropriate cases." Respondent did not offer any such regulation
issued by the Secretary of Labor.

Also, this recognition that the Labor Code may, under certain circumstances, treat women differently cannot
operate in favor of differentiating the age for compulsory retirement for male and female cabin attendants. To
reiterate, retirement laws are to be construed liberally in favor of the retiree to achieve its humanitarian purposes
[93] and the courts must give due consideration to "the context in which it is negotiated and purpose which it is
intended to serve." [94] Again, respondent did not advance a compelling reason to justify the difference for age
of compulsory retirement. That there is no reason to differentiate the age for compulsory retirement for male
and female cabin attendants is bolstered by a subsequent provision in their CBA, which provides that for cabin
attendants hired after November 22, 1996, the age for compulsory retirement is at 45 years old, without
distinction as to sex; and for those hired after November 22, 2000, the age for compulsory retirement is at 40
years old, again without distinction as to sex: SDHTEC

B. For Cabin Attendants hired after 22 November 1996:

1. Optional Retirement

Effective 22 November 1996, a Cabin Attendant who has completed at least four (4) years of continuous service
and is less than forty-five (45) years of age may retire at his option and, when so retired, he/she shall be entitled
to one and a half (1 1/2) months' salary for every year of completed service as retirement pay.

9
A Cabin Attendant hired after November 22, 2000 who has completed at least four (4) years of continuous
service and is less than forty (40) years of age may retire at his option and, when so retired, he/she shall be
entitled to one and a half (1 1/2) months' salary for every year of completed service as retirement pay.

2. Compulsory Retirement

Effective 22 November 1996, Cabin Attendants shall be compulsory retired at age forty-five (45) and, when so
retired, he/she shall be entitled to one and a half (1 1/2) months' salary for every year of completed service as
retirement pay.

Cabin attendant hired after November 22, 2000 shall be compulsorily retired at age forty (40) and, when so
retired, he/she shall be entitled to one and a half (1 1/2) month's salary for every year of completed service as
retirement pay. [95]

Evidently, the compulsory retirement provision in Section 144 (A) of the PAL-FASAP 2000-2005 CBA is
repugnant to the Constitution, the Labor Code, the Magna Carta of Women, and the CEDAW. Moreover, the
said provision was not voluntarily agreed upon by petitioners.

In Jaculbe v. Siliman University, [96] this Court emphasized that the employer and employee do not stand on
equal footing, and employees have no choice but to participate in the plan when their employment is at stake:

In this case, neither the CA nor the respondent cited any agreement, collective or otherwise, to justify the latter's
imposition of the early retirement age in its retirement plan, opting instead to harp on petitioner's alleged
"voluntary" contributions to the plan, which was simply untrue. The truth was that petitioner had no choice but
to participate in the plan, given that the only way she could refrain from doing so was to resign or lose her job.
It is axiomatic that employer and employee do not stand on equal footing, a situation which often causes an
employee to act out of need instead of any genuine acquiescence to the employer. This was clearly just such an
instance. HSAcaE

Not only was petitioner still a good eight years away from the compulsory retirement age but she was also still
fully capable of discharging her duties as shown by the fact that respondent's board of trustees seriously
considered rehiring her after the effectivity of her "compulsory retirement."

As already stated, an employer is free to impose a retirement age less than 65 for as long as it has the
employees' consent. Stated conversely, employees are free to accept the employer's offer to lower the retirement
age if they feel they can get a better deal with the retirement plan presented by the employer. Thus, having
terminated petitioner solely on the basis of a provision of a retirement plan which was not freely assented to by
her, respondent was guilty of illegal dismissal. [97] (Citations omitted)

In Cercado v. Uniprom, Inc., [98] this Court held that the employee's implied knowledge or passive
acquiescence to the employer's retirement plan cannot be equated to a voluntary and equivocal acceptance of the
early retirement age option, as it involves concession of the employee's right to security of tenure. Further, in
Paz v. Northern Tobacco Redrying Co., Inc., [99] this Court considered an employee illegally dismissed from
the time they were retired by the company at 60 years old despite absence of company policy supporting it and
the employee's lack of intent to retire.

Here, petitioners' act of vigorously pursuing this case all the way up to this Court twice for almost eighteen
years completely negates the claim that they agree to retire under the compulsory retirement provision of the
CBA. Even if embodied in the CBA, petitioners had no choice but to assent to the contested retirement
provision, considering that Article II, Section 3 of the CBA provides that "the Company will not hire [a] Cabin
Attendant without their being completely subject to the terms of th[e] Agreement." [100] This was assented to
by their male-denominated union representatives, who failed to protect their interests and even testified against
them. [101] Thus, despite the incorporation of the retirement provision in the CBA and petitioners' receipt of
retirement benefits, they cannot be estopped from questioning the validity of their retirement, since economic
necessity and the prospect of unemployment compelled the employees to accept the benefits offered them. [102]
That the distinction has been historically and mutually agreed upon in previous CBAs does not impose any
obligation on both parties to continually accept it.
Considering that the Civil Code [103] categorically provides that contracts and its stipulations, whose cause,
object, or purpose is contrary to law, morals, good customs, public order, or public policy, are void, Section 144
(A) of the PAL-FASAP 2000-2005 CBA is void for being contrary to the Constitution, laws, international
convention, and public policy. Petitioners are entitled to the reliefs they prayed for.
10
ACCORDINGLY, the Petition for Review is GRANTED. The May 31, 2018 Decision and November 19,
2018 Resolution of the Court of Appeals in CA-G.R. CV No. 107085 are REVERSED and SET ASIDE. The
May 22, 2015 Decision and October 9, 2015 Resolution of the Regional Trial Court of Makati City, Branch 59,
in Civil Case No. 04-886, are AFFIRMED and REINSTATED. SO ORDERED.

[G.R. No. 168081. October 17, 2008.]

ARMANDO G. YRASUEGUI, petitioner,vs.PHILIPPINE AIRLINES, INC., respondent.

DECISION
REYES, R.T., J p:

THIS case portrays the peculiar story of an international flight steward who was dismissed because of his
failure to adhere to the weight standards of the airline company. CacTSI

He is now before this Court via a petition for review on certiorari claiming that he was illegally dismissed. To
buttress his stance, he argues that (1) his dismissal does not fall under 282 (e) of the Labor Code; (2) continuing
adherence to the weight standards of the company is not a bona fide occupational qualification; and (3) he was
discriminated against because other overweight employees were promoted instead of being disciplined.

After a meticulous consideration of all arguments pro and con, We uphold the legality of dismissal. Separation
pay, however, should be awarded in favor of the employee as an act of social justice or based on equity. This is
so because his dismissal is not for serious misconduct. Neither is it reflective of his moral character.

The Facts
Petitioner Armando G. Yrasuegui was a former international flight steward of Philippine Airlines, Inc. (PAL).He
stands five feet and eight inches (5'8") with a large body frame. The proper weight for a man of his height and
body structure is from 147 to 166 pounds, the ideal weight being 166 pounds,as mandated by the Cabin and
Crew Administration Manual [1] of PAL. cIADTC

The weight problem of petitioner dates back to 1984. Back then, PAL advised him to go on an extended
vacation leave from December 29, 1984 to March 4, 1985 to address his weight concerns. Apparently, petitioner
failed to meet the company's weight standards, prompting another leave without pay from March 5, 1985 to
November 1985.

After meeting the required weight, petitioner was allowed to return to work. But petitioner's weight problem
recurred. He again went on leave without pay from October 17, 1988 to February 1989.

On April 26, 1989, petitioner weighed 209 pounds, 43 pounds over his ideal weight. In line with company
policy, he was removed from flight duty effective May 6, 1989 to July 3, 1989. He was formally requested to
trim down to his ideal weight and report for weight checks on several dates. He was also told that he may avail
of the services of the company physician should he wish to do so. He was advised that his case will be evaluated
on July 3, 1989. [2]

On February 25, 1989, petitioner underwent weight check. It was discovered that he gained, instead of losing,
weight. He was overweight at 215 pounds,which is 49 pounds beyond the limit. Consequently, his off-duty
status was retained. DcCHTa

On October 17, 1989, PAL Line Administrator Gloria Dizon personally visited petitioner at his residence to
check on the progress of his effort to lose weight. Petitioner weighed 217 pounds, gaining 2 pounds from his
previous weight. After the visit, petitioner made a commitment [3] to reduce weight in a letter addressed to
Cabin Crew Group Manager Augusto Barrios. The letter, in full, reads:

Dear Sir:

I would like to guaranty my commitment towards a weight loss from 217 pounds to 200 pounds from today
until 31 Dec. 1989. AaSHED

From thereon, I promise to continue reducing at a reasonable percentage until such time that my ideal weight is
achieved.

Likewise, I promise to personally report to your office at the designated time schedule you will set for my
weight check.

11
Respectfully Yours,

F/S Armando Yrasuegui [4]

Despite the lapse of a ninety-day period given him to reach his ideal weight, petitioner remained overweight.
On January 3, 1990, he was informed of the PAL decision for him to remain grounded until such time that he
satisfactorily complies with the weight standards. Again, he was directed to report every two weeks for weight
checks. SEcAIC

Petitioner failed to report for weight checks. Despite that, he was given one more month to comply with the
weight requirement. As usual, he was asked to report for weight check on different dates. He was reminded that
his grounding would continue pending satisfactory compliance with the weight standards. [5]

Again, petitioner failed to report for weight checks, although he was seen submitting his passport for processing
at the PAL Staff Service Division.

On April 17, 1990, petitioner was formally warned that a repeated refusal to report for weight check would be
dealt with accordingly. He was given another set of weight check dates. [6] Again, petitioner ignored the
directive and did not report for weight checks. On June 26, 1990, petitioner was required to explain his refusal
to undergo weight checks. [7]

When petitioner tipped the scale on July 30, 1990, he weighed at 212 pounds.Clearly, he was still way over his
ideal weight of 166 pounds. EaScHT

From then on, nothing was heard from petitioner until he followed up his case requesting for leniency on the
latter part of 1992. He weighed at 219 pounds on August 20, 1992 and 205 pounds on November 5, 1992.

On November 13, 1992, PAL finally served petitioner a Notice of Administrative Charge for violation of
company standards on weight requirements. He was given ten (10) days from receipt of the charge within which
to file his answer and submit controverting evidence. [8]

On December 7, 1992, petitioner submitted his Answer. [9] Notably, he did not deny being overweight. What he
claimed, instead, is that his violation, if any, had already been condoned by PAL since "no action has been taken
by the company" regarding his case "since 1988". He also claimed that PAL discriminated against him because
"the company has not been fair in treating the cabin crew members who are similarly situated". TcCDIS

On December 8, 1992, a clarificatory hearing was held where petitioner manifested that he was undergoing a
weight reduction program to lose at least two (2) pounds per week so as to attain his ideal weight. [10]

On June 15, 1993, petitioner was formally informed by PAL that due to his inability to attain his ideal weight,
"and considering the utmost leniency" extended to him "which spanned a period covering a total of almost five
(5) years", his services were considered terminated "effective immediately". [11]

His motion for reconsideration having been denied, [12] petitioner filed a complaint for illegal dismissal against
PAL. HcSCED

Labor Arbiter, NLRC and CA Dispositions

On November 18, 1998, Labor Arbiter Valentin C. Reyes ruled [13] that petitioner was illegally dismissed. The
dispositive part of the Arbiter ruling runs as follows:

WHEREFORE, in view of the foregoing, judgment is hereby rendered, declaring the complainant's dismissal
illegal, and ordering the respondent to reinstate him to his former position or substantially equivalent one, and
to pay him:

a. Backwages of Php10,500.00 per month from his dismissal on June 15, 1993 until reinstated, which for
purposes of appeal is hereby set from June 15, 1993 up to August 15, 1998 at P651,000.00; ITDHcA
b. Attorney's fees of five percent (5%) of the total award.

SO ORDERED. [14]

The Labor Arbiter held that the weight standards of PAL are reasonable in view of the nature of the job of
petitioner. [15] However, the weight standards need not be complied with under pain of dismissal since his
weight did not hamper the performance of his duties. [16] Assuming that it did, petitioner could be transferred
to other positions where his weight would not be a negative factor. [17] Notably, other overweight employees,
i.e., Mr. Palacios, Mr. Cui, and Mr. Barrios, were promoted instead of being disciplined. [18]

12
Both parties appealed to the National Labor Relations Commission (NLRC). [19]

On October 8, 1999, the Labor Arbiter issued a writ of execution directing the reinstatement of petitioner
without loss of seniority rights and other benefits. [20]

On February 1, 2000, the Labor Arbiter denied [21] the Motion to Quash Writ of Execution [22] of PAL.
HCEaDI

On March 6, 2000, PAL appealed the denial of its motion to quash to the NLRC. [23]

On June 23, 2000, the NLRC rendered judgment [24] in the following tenor:

WHEREFORE,premises considered[,] the Decision of the Arbiter dated 18 November 1998 as modified by our
findings herein, is hereby AFFIRMED and that part of the dispositive portion of said decision concerning
complainant's entitlement to backwages shall be deemed to refer to complainant's entitlement to his full
backwages, inclusive of allowances and to his other benefits or their monetary equivalent instead of simply
backwages, from date of dismissal until his actual reinstatement or finality hereof. Respondent is enjoined to
manifests (sic) its choice of the form of the reinstatement of complainant, whether physical or through payroll
within ten (10) days from notice failing which, the same shall be deemed as complainant's reinstatement
through payroll and execution in case of non-payment shall accordingly be issued by the Arbiter. Both appeals
of respondent thus, are DISMISSED for utter lack of merit. [25]

According to the NLRC, "obesity, or the tendency to gain weight uncontrollably regardless of the amount of
food intake, is a disease in itself". [26] As a consequence, there can be no intentional defiance or serious
misconduct by petitioner to the lawful order of PAL for him to lose weight. [27]

Like the Labor Arbiter, the NLRC found the weight standards of PAL to be reasonable. However, it found as
unnecessary the Labor Arbiter holding that petitioner was not remiss in the performance of his duties as flight
steward despite being overweight. According to the NLRC, the Labor Arbiter should have limited himself to the
issue of whether the failure of petitioner to attain his ideal weight constituted willful defiance of the weight
standards of PAL. [28]

PAL moved for reconsideration to no avail. [29] Thus, PAL elevated the matter to the Court of Appeals (CA) via
a petition for certiorari under Rule 65 of the 1997 Rules of Civil Procedure. [30]

By Decision dated August 31, 2004, the CA reversed [31] the NLRC:

WHEREFORE, premises considered, we hereby GRANT the petition. The assailed NLRC decision is declared
NULL and VOID and is hereby SET ASIDE. The private respondent's complaint is hereby DISMISSED. No
costs. caITAC

SO ORDERED. [32]

The CA opined that there was grave abuse of discretion on the part of the NLRC because it "looked at wrong
and irrelevant considerations" [33] in evaluating the evidence of the parties. Contrary to the NLRC ruling, the
weight standards of PAL are meant to be a continuing qualification for an employee's position. [34] The failure
to adhere to the weight standards is an analogous cause for the dismissal of an employee under Article 282 (e)
of the Labor Code in relation to Article 282 (a). It is not willful disobedience as the NLRC seemed to suggest.
[35] Said the CA, "the element of willfulness that the NLRC decision cites is an irrelevant consideration in
arriving at a conclusion on whether the dismissal is legally proper". [36] In other words, "the relevant question
to ask is not one of willfulness but one of reasonableness of the standard and whether or not the employee
qualifies or continues to qualify under this standard". [37]

Just like the Labor Arbiter and the NLRC, the CA held that the weight standards of PAL are reasonable. [38]
Thus, petitioner was legally dismissed because he repeatedly failed to meet the prescribed weight standards.
[39] It is obvious that the issue of discrimination was only invoked by petitioner for purposes of escaping the
result of his dismissal for being overweight. [40]

On May 10, 2005, the CA denied petitioner's motion for reconsideration. [41] Elaborating on its earlier ruling,
the CA held that the weight standards of PAL are a bona fide occupational qualification which, in case of
violation, "justifies an employee's separation from the service". [42]

Issues
In this Rule 45 petition for review, the following issues are posed for resolution:

13
I.

WHETHER OR NOT THE COURT OF APPEALS GRAVELY ERRED IN HOLDING THAT PETITIONER'S
OBESITY CAN BE A GROUND FOR DISMISSAL UNDER PARAGRAPH (e) OF ARTICLE 282 OF THE
LABOR CODE OF THE PHILIPPINES;

II.

WHETHER OR NOT THE COURT OF APPEALS GRAVELY ERRED IN HOLDING THAT PETITIONER'S
DISMISSAL FOR OBESITY CAN BE PREDICATED ON THE "BONA FIDE OCCUPATIONAL
QUALIFICATION (BFOQ) DEFENSE";

III.

WHETHER OR NOT THE COURT OF APPEALS GRAVELY ERRED IN HOLDING THAT PETITIONER
WAS NOT UNDULY DISCRIMINATED AGAINST WHEN HE WAS DISMISSED WHILE OTHER
OVERWEIGHT CABIN ATTENDANTS WERE EITHER GIVEN FLYING DUTIES OR PROMOTED;
IV.

WHETHER OR NOT THE COURT OF APPEALS GRAVELY ERRED WHEN IT BRUSHED ASIDE
PETITIONER'S CLAIMS FOR REINSTATEMENT [AND] WAGES ALLEGEDLY FOR BEING MOOT AND
ACADEMIC. [43] (Underscoring supplied)

Our Ruling
I. The obesity of petitioner is a ground for dismissal under Article 282 (e) [44] of the Labor Code.

A reading of the weight standards of PAL would lead to no other conclusion than that they constitute a
continuing qualification of an employee in order to keep the job. Tersely put, an employee may be dismissed the
moment he is unable to comply with his ideal weight as prescribed by the weight standards. The dismissal of the
employee would thus fall under Article 282 (e) of the Labor Code. As explained by the CA:

...[T]he standards violated in this case were not mere "orders" of the employer; they were the "prescribed
weights" that a cabin crew must maintain in order to qualify for and keep his or her position in the company.
In other words, they were standards that establish continuing qualifications for an employee's position. In this
sense, the failure to maintain these standards does not fall under Article 282 (a) whose express terms require the
element of willfulness in order to be a ground for dismissal. The failure to meet the employer's qualifying
standards is in fact a ground that does not squarely fall under grounds (a) to (d) and is therefore one that falls
under Article 282(e) — the "other causes analogous to the foregoing". TAIDHa

By its nature, these "qualifying standards" are norms that apply prior to and after an employee is hired. They
apply prior to employment because these are the standards a job applicant must initially meet in order to be
hired. They apply after hiring because an employee must continue to meet these standards while on the job in
order to keep his job. Under this perspective, a violation is not one of the faults for which an employee can be
dismissed pursuant to pars. (a) to (d) of Article 282; the employee can be dismissed simply because he no longer
"qualifies" for his job irrespective of whether or not the failure to qualify was willful or intentional. ... [45]

Petitioner, though, advances a very interesting argument. He claims that obesity is a "physical abnormality
and/or illness". [46] Relying on Nadura v. Benguet Consolidated, Inc., [47] he says his dismissal is illegal:

Conscious of the fact that Nadura's case cannot be made to fall squarely within the specific causes enumerated
in subparagraphs 1(a) to (e),Benguet invokes the provisions of subparagraph 1(f) and says that Nadura's illness
— occasional attacks of asthma — is a cause analogous to them. IASCTD

Even a cursory reading of the legal provision under consideration is sufficient to convince anyone that, as the
trial court said, "illness cannot be included as an analogous cause by any stretch of imagination".

It is clear that, except the just cause mentioned in sub-paragraph 1(a),all the others expressly enumerated in the
law are due to the voluntary and/or willful act of the employee. How Nadura's illness could be considered as
"analogous" to any of them is beyond our understanding, there being no claim or pretense that the same was
contracted through his own voluntary act. [48]
The reliance on Nadura is off-tangent. The factual milieu in Nadura is substantially different from the case at
bar. First, Nadura was not decided under the Labor Code. The law applied in that case was Republic Act (RA)
No. 1787. Second,the issue of flight safety is absent in Nadura, thus, the rationale there cannot apply here.

14
Third,in Nadura, the employee who was a miner, was laid off from work because of illness, i.e., asthma. Here,
petitioner was dismissed for his failure to meet the weight standards of PAL. He was not dismissed due to
illness. Fourth,the issue in Nadura is whether or not the dismissed employee is entitled to separation pay and
damages. Here, the issue centers on the propriety of the dismissal of petitioner for his failure to meet the weight
standards of PAL. Fifth,in Nadura, the employee was not accorded due process. Here, petitioner was accorded
utmost leniency. He was given more than four (4) years to comply with the weight standards of PAL. STcaDI

In the case at bar, the evidence on record militates against petitioner's claims that obesity is a disease. That he
was able to reduce his weight from 1984 to 1992 clearly shows that it is possible for him to lose weight given
the proper attitude, determination, and self-discipline. Indeed, during the clarificatory hearing on December 8,
1992, petitioner himself claimed that "[t]he issue is could I bring my weight down to ideal weight which is 172,
then the answer is yes. I can do it now". [49]

True, petitioner claims that reducing weight is costing him "a lot of expenses". [50] However, petitioner has
only himself to blame. He could have easily availed the assistance of the company physician, per the advice of
PAL. [51] He chose to ignore the suggestion. In fact, he repeatedly failed to report when required to undergo
weight checks, without offering a valid explanation. Thus, his fluctuating weight indicates absence of willpower
rather than an illness. EScHDA

Petitioner cites Bonnie Cook v. State of Rhode Island, Department of Mental Health, Retardation and Hospitals,
[52] decided by the United States Court of Appeals (First Circuit).In that case, Cook worked from 1978 to 1980
and from 1981 to 1986 as an institutional attendant for the mentally retarded at the Ladd Center that was being
operated by respondent. She twice resigned voluntarily with an unblemished record. Even respondent admitted
that her performance met the Center's legitimate expectations. In 1988, Cook re-applied for a similar position.
At that time, "she stood 5'2" tall and weighed over 320 pounds".Respondent claimed that the morbid obesity of
plaintiff compromised her ability to evacuate patients in case of emergency and it also put her at greater risk of
serious diseases.

Cook contended that the action of respondent amounted to discrimination on the basis of a handicap. This was
in direct violation of Section 504 (a) of the Rehabilitation Act of 1973, [53] which incorporates the remedies
contained in Title VI of the Civil Rights Act of 1964. Respondent claimed, however, that morbid obesity could
never constitute a handicap within the purview of the Rehabilitation Act. Among others, obesity is a mutable
condition, thus plaintiff could simply lose weight and rid herself of concomitant disability. cIHDaE

The appellate Court disagreed and held that morbid obesity is a disability under the Rehabilitation Act and that
respondent discriminated against Cook based on "perceived" disability. The evidence included expert testimony
that morbid obesity is a physiological disorder. It involves a dysfunction of both the metabolic system and the
neurological appetite — suppressing signal system, which is capable of causing adverse effects within the
musculoskeletal, respiratory, and cardiovascular systems. Notably, the Court stated that "mutability is relevant
only in determining the substantiality of the limitation flowing from a given impairment",thus "mutability only
precludes those conditions that an individual can easily and quickly reverse by behavioral alteration".

Unlike Cook, however, petitioner is not morbidly obese.In the words of the District Court for the District of
Rhode Island, Cook was sometime before 1978 "at least one hundred pounds more than what is considered
appropriate of her height".According to the Circuit Judge, Cook weighed "over 320 pounds" in 1988. Clearly,
that is not the case here. At his heaviest, petitioner was only less than 50 pounds over his ideal weight. CEDScA

In fine, We hold that the obesity of petitioner, when placed in the context of his work as flight attendant,
becomes an analogous cause under Article 282 (e) of the Labor Code that justifies his dismissal from the
service. His obesity may not be unintended, but is nonetheless voluntary. As the CA correctly puts it,
"[v]oluntariness basically means that the just cause is solely attributable to the employee without any external
force influencing or controlling his actions. This element runs through all just causes under Article 282, whether
they be in the nature of a wrongful action or omission. Gross and habitual neglect, a recognized just cause, is
considered voluntary although it lacks the element of intent found in Article 282 (a), (c), and (d)." [54]

II. The dismissal of petitioner can be predicated on the bona fide occupational qualification defense.
Employment in particular jobs may not be limited to persons of a particular sex, religion, or national origin
unless the employer can show that sex, religion, or national origin is an actual qualification for performing the
job. The qualification is called a bona fide occupational qualification (BFOQ). [55] In the United States, there
are a few federal and many state job discrimination laws that contain an exception allowing an employer to

15
engage in an otherwise unlawful form of prohibited discrimination when the action is based on a BFOQ
necessary to the normal operation of a business or enterprise. [56]

Petitioner contends that BFOQ is a statutory defense. It does not exist if there is no statute providing for it. [57]
Further, there is no existing BFOQ statute that could justify his dismissal. [58]

Both arguments must fail.

First, the Constitution, [59] the Labor Code, [60] and RA No. 7277 [61] or the Magna Carta for Disabled
Persons [62] contain provisions similar to BFOQ. DcAaSI

Second,in British Columbia Public Service Employee Commission (BSPSERC) v. The British Columbia
Government and Service Employee's Union (BCGSEU), [63] the Supreme Court of Canada adopted the so-
called "Meiorin Test" in determining whether an employment policy is justified. Under this test, (1) the
employer must show that it adopted the standard for a purpose rationally connected to the performance of the
job; [64] (2) the employer must establish that the standard is reasonably necessary [65] to the accomplishment
of that work-related purpose; and (3) the employer must establish that the standard is reasonably necessary in
order to accomplish the legitimate work-related purpose. Similarly, in Star Paper Corporation v. Simbol, [66]
this Court held that in order to justify a BFOQ, the employer must prove that (1) the employment qualification
is reasonably related to the essential operation of the job involved; and (2) that there is factual basis for
believing that all or substantially all persons meeting the qualification would be unable to properly perform the
duties of the job. [67]

In short, the test of reasonableness of the company policy is used because it is parallel to BFOQ. [68] BFOQ is
valid "provided it reflects an inherent quality reasonably necessary for satisfactory job performance". [69]

In Duncan Association of Detailman-PTGWTO v. Glaxo Wellcome Philippines, Inc., [70] the Court did not
hesitate to pass upon the validity of a company policy which prohibits its employees from marrying employees
of a rival company. It was held that the company policy is reasonable considering that its purpose is the
protection of the interests of the company against possible competitor infiltration on its trade secrets and
procedures. TASCDI

Verily, there is no merit to the argument that BFOQ cannot be applied if it has no supporting statute. Too, the
Labor Arbiter, [71] NLRC, [72] and CA [73] are one in holding that the weight standards of PAL are reasonable.
A common carrier, from the nature of its business and for reasons of public policy, is bound to observe
extraordinary diligence for the safety of the passengers it transports. [74] It is bound to carry its passengers
safely as far as human care and foresight can provide, using the utmost diligence of very cautious persons, with
due regard for all the circumstances. [75]

The law leaves no room for mistake or oversight on the part of a common carrier. Thus, it is only logical to hold
that the weight standards of PAL show its effort to comply with the exacting obligations imposed upon it by law
by virtue of being a common carrier. cSDHEC

The business of PAL is air transportation.As such, it has committed itself to safely transport its passengers. In
order to achieve this, it must necessarily rely on its employees, most particularly the cabin flight deck crew who
are on board the aircraft. The weight standards of PAL should be viewed as imposing strict norms of discipline
upon its employees.

In other words, the primary objective of PAL in the imposition of the weight standards for cabin crew is flight
safety.It cannot be gainsaid that cabin attendants must maintain agility at all times in order to inspire passenger
confidence on their ability to care for the passengers when something goes wrong. It is not farfetched to say that
airline companies, just like all common carriers, thrive due to public confidence on their safety records. People,
especially the riding public, expect no less than that airline companies transport their passengers to their
respective destinations safely and soundly. A lesser performance is unacceptable. aAEIHC

The task of a cabin crew or flight attendant is not limited to serving meals or attending to the whims and
caprices of the passengers. The most important activity of the cabin crew is to care for the safety of passengers
and the evacuation of the aircraft when an emergency occurs. Passenger safety goes to the core of the job of a
cabin attendant.Truly, airlines need cabin attendants who have the necessary strength to open emergency doors,
the agility to attend to passengers in cramped working conditions, and the stamina to withstand grueling flight
schedules.

On board an aircraft, the body weight and size of a cabin attendant are important factors to consider in case of
emergency. Aircrafts have constricted cabin space, and narrow aisles and exit doors. Thus, the arguments of
16
respondent that "[w]hether the airline's flight attendants are overweight or not has no direct relation to its
mission of transporting passengers to their destination";and that the weight standards "has nothing to do with
airworthiness of respondent's airlines",must fail. DHaEAS

The rationale in Western Air Lines v. Criswell [76] relied upon by petitioner cannot apply to his case. What was
involved there were two (2) airline pilots who were denied reassignment as flight engineers upon reaching the
age of 60, and a flight engineer who was forced to retire at age 60. They sued the airline company, alleging that
the age-60 retirement for flight engineers violated the Age Discrimination in Employment Act of 1967. Age-
based BFOQ and being overweight are not the same.The case of overweight cabin attendants is another matter.
Given the cramped cabin space and narrow aisles and emergency exit doors of the airplane, any overweight
cabin attendant would certainly have difficulty navigating the cramped cabin area. ADSTCI

In short, there is no need to individually evaluate their ability to perform their task. That an obese cabin
attendant occupies more space than a slim one is an unquestionable fact which courts can judicially recognize
without introduction of evidence. [77] It would also be absurd to require airline companies to reconfigure the
aircraft in order to widen the aisles and exit doors just to accommodate overweight cabin attendants like
petitioner.

The biggest problem with an overweight cabin attendant is the possibility of impeding passengers from
evacuating the aircraft, should the occasion call for it. The job of a cabin attendant during emergencies is to
speedily get the passengers out of the aircraft safely. Being overweight necessarily impedes mobility.Indeed, in
an emergency situation, seconds are what cabin attendants are dealing with, not minutes.Three lost seconds can
translate into three lost lives. Evacuation might slow down just because a wide-bodied cabin attendant is
blocking the narrow aisles. These possibilities are not remote. IcTCHD

Petitioner is also in estoppel. He does not dispute that the weight standards of PAL were made known to him
prior to his employment. He is presumed to know the weight limit that he must maintain at all times. [78] In
fact, never did he question the authority of PAL when he was repeatedly asked to trim down his weight. Bona
fides exigit ut quod convenit fiat. Good faith demands that what is agreed upon shall be done. Kung ang tao ay
tapat kanyang tutuparin ang napagkasunduan.
Too, the weight standards of PAL provide for separate weight limitations based on height and body frame for
both male and female cabin attendants. A progressive discipline is imposed to allow non-compliant cabin
attendants sufficient opportunity to meet the weight standards. Thus, the clear-cut rules obviate any possibility
for the commission of abuse or arbitrary action on the part of PAL. HcSaTI

III. Petitioner failed to substantiate his claim that he was discriminated against by PAL.
Petitioner next claims that PAL is using passenger safety as a convenient excuse to discriminate against him.
[79] We are constrained, however, to hold otherwise. We agree with the CA that "[t]he element of discrimination
came into play in this case as a secondary position for the private respondent in order to escape the consequence
of dismissal that being overweight entailed. It is a confession-and-avoidance position that impliedly admitted
the cause of dismissal, including the reasonableness of the applicable standard and the private respondent's
failure to comply". [80] It is a basic rule in evidence that each party must prove his affirmative allegation. [81]

Since the burden of evidence lies with the party who asserts an affirmative allegation, petitioner has to prove his
allegation with particularity. There is nothing on the records which could support the finding of discriminatory
treatment. Petitioner cannot establish discrimination by simply naming the supposed cabin attendants who are
allegedly similarly situated with him. Substantial proof must be shown as to how and why they are similarly
situated and the differential treatment petitioner got from PAL despite the similarity of his situation with other
employees. ICHcaD

Indeed, except for pointing out the names of the supposed overweight cabin attendants, petitioner miserably
failed to indicate their respective ideal weights; weights over their ideal weights; the periods they were allowed
to fly despite their being overweight; the particular flights assigned to them; the discriminating treatment they
got from PAL; and other relevant data that could have adequately established a case of discriminatory treatment
by PAL. In the words of the CA, "PAL really had no substantial case of discrimination to meet". [82]

We are not unmindful that findings of facts of administrative agencies, like the Labor Arbiter and the NLRC, are
accorded respect, even finality. [83] The reason is simple: administrative agencies are experts in matters within
their specific and specialized jurisdiction. [84] But the principle is not a hard and fast rule. It only applies if the
findings of facts are duly supported by substantial evidence. If it can be shown that administrative bodies
grossly misappreciated evidence of such nature so as to compel a conclusion to the contrary, their findings of
17
facts must necessarily be reversed. Factual findings of administrative agencies do not have infallibility and must
be set aside when they fail the test of arbitrariness. [85]

Here, the Labor Arbiter and the NLRC inexplicably misappreciated evidence. We thus annul their findings.

To make his claim more believable, petitioner invokes the equal protection clause guaranty [86] of the
Constitution. However, in the absence of governmental interference, the liberties guaranteed by the Constitution
cannot be invoked. [87] Put differently, the Bill of Rights is not meant to be invoked against acts of private
individuals. [88] Indeed, the United States Supreme Court, in interpreting the Fourteenth Amendment, [89]
which is the source of our equal protection guarantee, is consistent in saying that the equal protection erects no
shield against private conduct, however discriminatory or wrongful. [90] Private actions, no matter how
egregious, cannot violate the equal protection guarantee. [91]

IV. The claims of petitioner for reinstatement and wages are moot.
As his last contention, petitioner avers that his claims for reinstatement and wages have not been mooted. He is
entitled to reinstatement and his full backwages, "from the time he was illegally dismissed" up to the time that
the NLRC was reversed by the CA. [92]

At this point, Article 223 of the Labor Code finds relevance:

In any event, the decision of the Labor Arbiter reinstating a dismissed or separated employee, insofar as the
reinstatement aspect is concerned, shall immediately be executory, even pending appeal. The employee shall
either be admitted back to work under the same terms and conditions prevailing prior to his dismissal or
separation or, at the option of the employer,merely reinstated in the payroll. The posting of a bond by the
employer shall not stay the execution for reinstatement provided herein. ATaDHC

The law is very clear. Although an award or order of reinstatement is self-executory and does not require a writ
of execution, [93] the option to exercise actual reinstatement or payroll reinstatement belongs to the employer. It
does not belong to the employee, to the labor tribunals, or even to the courts.

Contrary to the allegation of petitioner that PAL "did everything under the sun" to frustrate his "immediate
return to his previous position", [94] there is evidence that PAL opted to physically reinstate him to a
substantially equivalent position in accordance with the order of the Labor Arbiter. [95] In fact, petitioner duly
received the return to work notice on February 23, 2001, as shown by his signature. [96]

Petitioner cannot take refuge in the pronouncements of the Court in a case [97] that "[t]he unjustified refusal of
the employer to reinstate the dismissed employee entitles him to payment of his salaries effective from the time
the employer failed to reinstate him despite the issuance of a writ of execution" [98] and "even if the order of
reinstatement of the Labor Arbiter is reversed on appeal, it is obligatory on the part of the employer to reinstate
and pay the wages of the employee during the period of appeal until reversal by the higher court". [99] He failed
to prove that he complied with the return to work order of PAL. Neither does it appear on record that he actually
rendered services for PAL from the moment he was dismissed, in order to insist on the payment of his full
backwages. cTCEIS

In insisting that he be reinstated to his actual position despite being overweight, petitioner in effect wants to
render the issues in the present case moot. He asks PAL to comply with the impossible. Time and again, the
Court ruled that the law does not exact compliance with the impossible. [100]

V. Petitioner is entitled to separation pay.

Be that as it may, all is not lost for petitioner.

Normally, a legally dismissed employee is not entitled to separation pay. This may be deduced from the
language of Article 279 of the Labor Code that "[a]n employee who is unjustly dismissed from work shall be
entitled to reinstatement without loss of seniority rights and other privileges and to his full backwages, inclusive
of allowances, and to his other benefits or their monetary equivalent computed from the time his compensation
was withheld from him up to the time of his actual reinstatement".Luckily for petitioner, this is not an ironclad
rule. caTESD

Exceptionally, separation pay is granted to a legally dismissed employee as an act "social justice", [101] or
based on "equity". [102] In both instances, it is required that the dismissal (1) was not for serious misconduct;
and (2) does not reflect on the moral character of the employee. [103]

18
Here, We grant petitioner separation pay equivalent to one-half (1/2) month's pay for every year of service.
[104] It should include regular allowances which he might have been receiving. [105] We are not blind to the
fact that he was not dismissed for any serious misconduct or to any act which would reflect on his moral
character. We also recognize that his employment with PAL lasted for more or less a decade. HIaTDS

WHEREFORE, the appealed Decision of the Court of Appeals is AFFIRMED but MODIFIED in that petitioner
Armando G. Yrasuegui is entitled to separation pay in an amount equivalent to one-half (1/2) month's pay for
every year of service, which should include his regular allowances. SO ORDERED.

[G.R. No. 122917. July 12, 1999.]

MARITES BERNARDO, ELVIRA GO DIAMANTE, REBECCA E. DAVID, DAVID P. PASCUAL,

RAQUEL ESTILLER, ALBERT HALLARE, EDMUND M. CORTEZ, JOSELITO O. AGDON,
GEORGE P. LIGUTAN JR.,CELSO M. YAZAR, ALEX G. CORPUZ, RONALD M. DELFIN,
ROWENA M. TABAQUERO, CORAZON C. DELOS REYES, ROBERT G. NOORA, MILAGROS O.
LEQUIGAN, ADRIANA F. TATLONGHARI, IKE CABANDUCOS, COCOY NOBELLO, DORENDA
CANTIMBUHAN, ROBERT MARCELO, LILIBETH Q. MARMOLEJO, JOSE E. SALES, ISABEL
MAMAUAG, VIOLETA G. MONTES, ALBINO TECSON, MELODY V. GRUELA, BERNADETH D.
AGERO, CYNTHIA DE VERA, LANI R. CORTEZ, MA. ISABEL B. CONCEPCION, DINDO
VALERIO, ZENAIDA MATA, ARIEL DEL PILAR, MARGARET CECILIA CANOZA, THELMA
SEBASTIAN, MA. JEANETTE CERVANTES, JEANNIE RAMIL, ROZAIDA PASCUAL, PINKY
BALOLOA, ELIZABETH VENTURA, GRACE S. PARDO and RICO TIMOSA, petitioners, vs.
NATIONAL LABOR RELATIONS COMMISSION & FAR EAST BANK AND TRUST
COMPANY,respondents.

Sentro ng Alternatibong Lingap Panlegal (SALIGAN) for petitioners.

Picazo Buyco Tan Fider & San for private respondent.

SYNOPSIS
This petition sought the reversal of the decision of the National Labor Relations Commission affirming the
ruling of the labor arbiter that they could not be deemed regular employees under Article 280 of the Labor
Code.

The Court granted the petition. Respondent bank entered into employment contracts with handicapped workers
and renewed the contracts of 37 of them. This showed that these workers were qualified to perform the
responsibilities of their positions. The Magna Carta for Disabled Persons mandates that a qualified disabled
employee should be given the same terms of employment as a qualified able-bodied person. This being so,
petitioners are thus covered by Art. 280 of the Labor Code which defines regular employment to be that the
employee has been engaged to perform activities usually necessary or desirable in the usual business or trade of
the employer. The task of counting and sorting bills is necessary to the business of respondent bank. With the
exception of sixteen of them, petitioners performed these tasks for more than six months. Therefore, the 27
petitioners should be deemed regular employees entitled to security of tenure. Their services may only be
terminated for a just and authorized cause. Because respondents failed to show such cause, these 27 petitioners
are deemed illegally dismissed and hence entitled to backwages and separation pay.

SYLLABUS
1. REMEDIAL LAW; SPECIAL CIVIL ACTIONS; CERTIORARI; FACTUAL FINDINGS, NOT SUBJECT
TO REVIEW. — True, the Court, as a rule,does not review the factual findings of public respondents in a
certiorari proceeding. In resolving whether the petitioners have become regular employees, we shall not change
the facts found by the public respondent. Our task is merely to determine whether the NLRC committed grave
abuse of discretion in applying the law to the established facts, as above-quoted from the assailed Decision.

2. LABOR AND SOCIAL LEGISLATION; LABOR CODE; EMPLOYMENT CONTRACTS; QUALIFIED

DISABLED PERSONS REMOVE CONTRACT FROM AMBIT OF ARTICLE 80 OF LABOR CODE. — The
Magna Carta for Disabled Persons mandates that a qualified disabled employee should be given the same terms
and conditions of employment as a qualified able-bodied person. The fact that the employees were qualified
disabled persons necessarily removes the employment contracts from the ambit of Article 80. Since the Magna
Carta accords them the rights of qualified able-bodied persons, they are thus covered by Article 280 of the
Labor Code.
19
3. ID.;ID.;EMPLOYMENT; TEST WHETHER EMPLOYEE IS REGULAR. — The test of whether an
employee is regular was laid down in De Leon v. NLRC,in which this Court held: "The primary standard,
therefore, of determining regular employment is the reasonable connection between the particular activity
performed by the employee in relation to the usual trade or business of the employer. The test is whether the
former is usually necessary or desirable in the usual business or trade of the employer. The connection can be
determined by considering the nature of the work performed and its relation to the scheme of the particular
business or trade in its entirety. Also if the employee has been performing the job for at least one year, even if
the performance is not continuous and merely intermittent, the law deems repeated and continuing need for its
performance as sufficient evidence of the necessity if not indispensability of that activity to the business. Hence,
the employment is considered regular, but only with respect to such activity, and while such activity exists."

4. ID.; ID.; ID.; ID.; CASE AT BAR. — Without a doubt, the task of counting and sorting bills is necessary and
desirable to the business of respondent bank. With the exception of sixteen of them, petitioners performed these
tasks for more than six months. Thus, the twenty-seven petitioners should be deemed regular employees. As
held by the Court, "Articles 280 and 281 of the Labor Code put an end to the pernicious practice of making
permanent casuals of our lowly employees by the simple expedient of extending to them probationary
appointments, ad infinitum." The contract signed by petitioners is akin to a probationary employment, during
which the bank determined the employees' fitness for the job. When the bank renewed the contract after the
lapse of the six-month probationary period, the employees thereby became regular employees. No employer is
allowed to determine indefinitely the fitness of its employees.

5. ID.;ID.;ID.;REGULAR EMPLOYEES ENTITLED TO SECURITY OF TENURE; ILLEGALLY

DISMISSED EMPLOYEE ENTITLED TO SEPARATION PAY IN LIEU OF REINSTATEMENT. — As
regular employees, the twenty-seven petitioners are entitled to security of tenure; that is, their services may be
terminated only for a just or authorized cause. Because respondent failed to show such cause, these twenty-
seven petitioners are deemed illegally dismissed and therefore entitled to back wages and reinstatement without
loss of seniority rights and other privileges. Considering the allegation of respondent that the job of money
sorting is no longer available because it has been assigned back to the tellers to whom it originally belonged,
petitioners are hereby awarded separation pay in lieu of reinstatement. Because the other sixteen worked only
for six months, they are not deemed regular employees and hence not entitled to the same benefits.

6. ID.;ID.;ID.;EMPLOYMENT CONTRACT WITH FIXED TERM; RULING IN BRENT CASE NOT

APPLICABLE IN CASE AT BAR. — Respondent bank, citing Brent School v. Zamora in which the Court
upheld the validity of an employment contract with a fixed term, argues that the parties entered into the contract
on equal footing. It adds that the petitioners had in fact an advantage, because they were backed by then DSWD
Secretary Mita Pardo de Tavera and Representative Arturo Borjal. We are not persuaded. The term limit in the
contract was premised on the fact that the petitioners were disabled, and that the bank had to determine their
fitness for the position. Indeed, its validity is based on Article 80 of the Labor Code.But as noted earlier,
petitioners proved themselves to be qualified disabled persons who, under the Magna Carta for Disabled
Persons, are entitled to terms and conditions of employment enjoyed by qualified able-bodied individuals;
hence, Article 80 does not apply because petitioners are qualified for their positions. The validation of the limit
imposed on their contracts, imposed by reason of their disability, was a glaring instance of the very mischief
sought to be addressed by the new law.

7. ID.; ID.; EMPLOYMENT CONTRACT; IMPRESSED WITH PUBLIC INTEREST; PARTIES ARE NOT
AT LIBERTY TO INSULATE THEMSELVES. — It must be emphasized that a contract of employment is
impressed with public interest. Provisions of applicable statutes are deemed written into the contract, and the
"parties are not at liberty to insulate themselves and their relationships from the impact of labor laws and
regulations by simply contracting with each other." Clearly, the agreement of the parties regarding the period of
employment cannot prevail over the provisions of the Magna Carta for Disabled Persons, which mandate that
petitioners must be treated as qualified able-bodied employees. DTEIaC

8. ID.;ID.;EMPLOYMENT; CHARACTER OF EMPLOYMENT; HOW DETERMINED. — As earlier noted,

an employee is regular because of the nature of work and the length of service, not because of the mode or even
the reason for hiring them. In L.T. Datu v. NLRC,the Court held that "the determination of whether employment
is casual or regular does not depend on the will or word of the employer, and the procedure of hiring ...but on
the nature of the activities performed by the employee, and to some extent, the length of performance and its
continued existence." The character of employment is determined not by stipulations in the contract, but by the
nature of the work performed. Otherwise, no employee can become regular by the simple expedient of
incorporating this condition in the contract of employment.

20
9. ID.; MAGNA CARTA FOR DISABLED PERSONS; OBJECTIVES BASED NOT MERELY ON CHARITY
BUT ON JUSTICE AND EQUAL TREATMENT OF QUALIFIED PERSONS. — In rendering this Decision,
the Court emphasizes not only the constitutional bias in favor of the working class, but also the concern of the
State for the plight of the disabled. The noble objectives of Magna Carta for Disabled Persons are not based
merely on charity or accommodation, but on justice and the equal treatment of qualified persons, disabled or
not. In the present case, the handicap of petitioners (deaf-mutes) is not a hindrance to their work. The eloquent
proof of this statement is the repeated renewal of their employment contracts. Why then should they be
dismissed, simply because they are physically impaired? The Court believes, that, after showing their fitness for
the work assigned to them, they should be treated and granted the same rights like any other regular employees.

DECISION
PANGANIBAN, J p:

The Magna Carta for Disabled Persons mandates that qualified disabled persons be granted the same terms and
conditions of employment as qualified able-bodied employees. Once they have attained the status of regular
workers, they should be accorded all the benefits granted by law, notwithstanding written or verbal contracts to
the contrary. This treatment is rooted not merely on charity or accommodation, but on justice for all. LLjur

The Case

Challenged in the Petition for Certiorari [1] before us is the June 20, 1995 Decision [2] of the National Labor
Relations Commission (NLRC), [3] which affirmed the August, 22 1994 ruling of Labor Arbiter Cornelio L.
Linsangan. The labor arbiter's Decision disposed as follows: [4]

"WHEREFORE, judgment is hereby rendered dismissing the above-mentioned complaint for lack of merit."

Also assailed is the August 4, 1995 Resolution [5] of the NLRC, which denied the Motion for Reconsideration.
The Facts

The facts were summarized by the NLRC in this wise: [6]

"Complainants numbering 43 (p. 176, Records) are deaf-mutes who were hired on various periods from 1988 to
1993 by respondent Far East Bank and Trust Co. as Money Sorters and Counters through a uniformly worded
agreement called 'Employment Contract for Handicapped Workers'.(pp. 68 & 69, Records) The full text of said
agreement is quoted below:

'EMPLOYMENT CONTRACT FOR HANDICAPPED WORKERS

This Contract, entered into by and between:

FAR EAST BANK AND TRUST COMPANY, a universal banking corporation duly organized and existing
under and by virtue of the laws of the Philippines, with business address at FEBTC Building, Muralla,
Intramuros, Manila, represented herein by its Assistant Vice President, MR. FLORENDO G. MARANAN,
(hereinafter referred to as the 'BANK');

- and -

__________________________, _______ years old, of legal age, _____________, and residing at

______________________ (hereinafter referred to as the ('EMPLOYEE').

WITNESSETH: That

WHEREAS, the BANK, cognizant of its social responsibility, realizes that there is a need to provide disabled
and handicapped persons gainful employment and opportunities to realize their potentials, uplift their socio-
economic well being and welfare and make them productive, self-reliant and useful citizens to enable them to
fully integrate in the mainstream of society; cdtai

WHEREAS, there are certain positions in the BANK which may be filled-up by disabled and handicapped
persons, particularly deaf-mutes, and the BANK ha[s] been approached by some civic-minded citizens and
authorized government agencies [regarding] the possibility of hiring handicapped workers for these positions;

WHEREAS, the EMPLOYEE is one of those handicapped workers who [were] recommended for possible
employment with the BANK;

21
NOW, THEREFORE, for and in consideration of the foregoing premises and in compliance with Article 80 of
the Labor Code of the Philippines as amended, the BANK and the EMPLOYEE have entered into this
Employment Contract as follows:

1. The BANK agrees to employ and train the EMPLOYEE, and the EMPLOYEE agrees to diligently and
faithfully work with the BANK, as Money Sorter and Counter.

2. The EMPLOYEE shall perform among others, the following duties and responsibilities:

i. Sort out bills according to color;

ii. Count each denomination per hundred, either manually or with the aid of a counting machine;

iii. Wrap and label bills per hundred;

iv. Put the wrapped bills into bundles; and

v. Submit bundled bills to the bank teller for verification.

3. The EMPLOYEE shall undergo a training period of one (1) month, after which the BANK shall determine
whether or not he/she should be allowed to finish the remaining term of this Contract.

4. The EMPLOYEE shall be entitled to an initial compensation of P118.00 per day, subject to adjustment in the
sole judgment of the BANK, payable every 15th and end of the month.

5. The regular work schedule of the EMPLOYEE shall be five (5) days per week, from Mondays thru Fridays,
at eight (8) hours a day. The EMPLOYEE may be required to perform overtime work as circumstance may
warrant, for which overtime work he/she [shall] be paid an additional compensation of 125% of his daily rate if
performed during ordinary days and 130% if performed during Saturday or [a] rest day.

6. The EMPLOYEE shall likewise be entitled to the following benefits:

i. Proportionate 13th month pay based on his basic daily wage.

ii. Five (5) days incentive leave.

iii. SSS premium payment.

7. The EMPLOYEE binds himself/herself to abide [by] and comply with all the BANK Rules and Regulations
and Policies, and to conduct himself/herself in a manner expected of all employees of the BANK.

8. The EMPLOYEE acknowledges the fact that he/she had been employed under a special employment program
of the BANK, for which reason the standard hiring requirements of the BANK were not applied in his/her case.
Consequently, the EMPLOYEE acknowledges and accepts the fact that the terms and conditions of the
employment generally observed by the BANK with respect to the BANK's regular employee are not applicable
to the EMPLOYEE, and that therefore, the terms and conditions of the EMPLOYEE's employment with the
BANK shall be governed solely and exclusively by this Contract and by the applicable rules and regulations
that the Department of Labor and Employment may issue in connection with the employment of disabled and
handicapped workers. More specifically, the EMPLOYEE hereby acknowledges that the provisions of Book Six
of the Labor Code of the Philippines as amended, particularly on regulation of employment and separation pay
are not applicable to him/her. dctai

9. The Employment Contract shall be for a period of six (6) months or from ____ to ____ unless earlier
terminated by the BANK for any just or reasonable cause. Any continuation or extension of this Contract shall
be in writing and therefore this Contract will automatically expire at the end of its terms unless renewed in
writing by the BANK.

IN WITNESS WHEREOF, the parties, have hereunto affixed their signature[s] this ____ day of
_________________, ____________ at Intramuros, Manila, Philippines.'

"In 1988, two (2) deaf-mutes were hired under this Agreement; in 1989 another two (2);in 1990, nineteen
(19);in 1991 six (6);in 1992, six (6) and in 1993, twenty-one (21).Their employment[s] were renewed every six
months such that by the time this case arose, there were fifty-six (56) deaf-mutes who were employed by
respondent under the said employment agreement. The last one was Thelma Malindoy who was employed in
1992 and whose contract expired on July 1993.
xxx xxx xxx

22
"Disclaiming that complainants were regular employees, respondent Far East Bank and Trust Company
maintained that complainants who are a special class of workers — the hearing impaired employees were hired
temporarily under [a] special employment arrangement which was a result of overtures made by some civic and
political personalities to the respondent Bank; that complainant[s] were hired due to 'pakiusap' which must be
considered in the light of the context of the respondent Bank's corporate philosophy as well as its career and
working environment which is to maintain and strengthen a corps of professionals trained and qualified officers
and regular employees who are baccalaureate degree holders from excellent schools which is an unbending
policy in the hiring of regular employees; that in addition to this, training continues so that the regular employee
grows in the corporate ladder; that the idea of hiring handicapped workers was acceptable to them only on a
special arrangement basis; that it adopted the special program to help tide over a group of handicapped workers
such as deaf-mutes like the complainants who could do manual work for the respondent Bank; that the task of
counting and sorting of bills which was being performed by tellers could be assigned to deaf-mutes; that the
counting and sorting of money are tellering works which were always logically and naturally part and parcel of
the tellers' normal functions; that from the beginning there have been no separate items in the respondent Bank
plantilla for sorters or counters; that the tellers themselves already did the sorting and counting chore as a
regular feature and integral part of their duties (p. 97, Records);that through the 'pakiusap' of Arturo Borjal, the
tellers were relieved of this task of counting and sorting bills in favor of deaf-mutes without creating new
positions as there is no position either in the respondent or in any other bank in the Philippines which deals with
purely counting and sorting of bills in banking operations." cda
Petitioners specified when each of them was hired and dismissed, viz: [7]

"NAME OF PETITIONER WORKPLACE Date Hired Date Dismissed

1. MARITES BERNARDO Intramuros 12 NOV 90 17 NOV 93

2. ELVIRA GO DIAMANTE Intramuros 24 JAN 90 11 JAN 94

3. REBECCA E. DAVID Intramuros 16 APR 90 23 OCT 93

4. DAVID P. PASCUAL Bel-Air 15 OCT 88 21 NOV 94

5. RAQUEL ESTILLER Intramuros 2 JUL 92 4 JAN 94

6. ALBERT HALLARE West 4 JAN 91 9 JAN 94

7. EDMUND M. CORTEZ Bel-Air 15 JAN 91 3 DEC 93

8. JOSELITO O. AGDON Intramuros 5 NOV 90 17 NOV 93

9. GEORGE P. LIGUTAN, JR. Intramuros 6 SEPT 89 19 JAN 94

10. CELSO M. YAZAR Intramuros 8 FEB 93 8 AUG 93

11. ALEX G. CORPUZ Intramuros 15 FEB 93 15 AUG 93

12. RONALD M. DELFIN Intramuros 22 FEB 93 22 AUG 93

13. ROWENA M. TABAQUERO Intramuros 22 FEB 93 22 AUG 93

14. CORAZON C. DELOS REYES Intramuros 8 FEB 93 8 AUG 93

15. ROBERT G. NOORA Intramuros 15 FEB 93 15 AUG 93

16. MILAGROS O. LEQUIGAN Intramuros 1 FEB 93 1 AUG 93

17. ADRIANA F. TATLONGHARI Intramuros 22 JAN 93 22 JUL 93

18. IKE CABANDUCOS Intramuros 24 FEB 93 24 AUG 93

19. COCOY NOBELLO Intramuros 22 FEB 93 22 AUG 93

20. DORENDA CATIMBUHAN Intramuros 15 FEB 93 15 AUG 93
21. ROBERT MARCELO West 31 JUL 93 8 1 AUG 93

22. LILIBETH Q. MARMOLEJO West 15 JUN 90 21 NOV 93

23
 23. JOSE E. SALES West 6 AUG 92 12 OCT 93

24. ISABEL MAMAUAG West 8 MAY 92 10 NOV 93

25. VIOLETA G. MONTES Intramuros 2 FEB 90 15 JAN 94

26. ALBINO TECSON Intramuros 7 NOV 91 10 NOV 93

27. MELODY V. GRUELA West 28 OCT 91 3 NOV 93

28. BERNADETH D. AGERO West 19 DEC 90 27 DEC 93

29. CYNTHIA DE VERA Bel-Air 26 JUN 90 3 DEC 93

30. LANI R. CORTEZ Bel-Air 15 OCT 88 10 DEC 93

31. MA. ISABEL B. CONCEPCION West 6 SEPT 90 6 FEB 94

32. DINDO VALERIO Intramuros 30 MAY 93 30 NOV 93

33. ZENAIDA MATA Intramuros 10 FEB 93 10 AUG 93

34. ARIEL DEL PILAR Intramuros 24 FEB 93 24 AUG 93

35. MARGARET CECILIA CANOZA Intramuros 27 JUL 90 4 FEB 94

36. THELMA SEBASTIAN Intramuros 12 NOV 90 17 NOV 93

37. MA. JEANETTE CERVANTES West 6 JUN 92 7 DEC 93

38. JEANNIE RAMIL Intramuros 23 APR 90 12 OCT 93

39. ROZAIDA PASCUAL Bel-Air 20 APR 89 29 OCT 93

40. PINKY BALOLOA West 3 JUN 91 2 DEC 93

41. ELIZABETH VENTURA West 12 MAR 90 FEB 94 [sic]

42. GRACE S. PARDO West 4 APR 90 13 MAR 94

43. RICO TIMOSA Intramuros 28 APR 93 28 OCT 93"

As earlier noted, the labor arbiter and, on appeal, the NLRC ruled against herein petitioners. Hence, this
recourse to this Court. [9]

The Ruling of the NLRC

In affirming the ruling of the labor arbiter that herein petitioners could not be deemed regular employees under
Article 280 of the Labor Code, as amended, Respondent Commission ratiocinated as follows:

"We agree that Art. 280 is not controlling herein. We give due credence to the conclusion that complainants
were hired as an accommodation to [the] recommendation of civic oriented personalities whose employment[s]
were covered by ...Employment Contract[s] with special provisions on duration of contract as specified under
Art. 80. Hence, as correctly held by the Labor Arbiter a quo,the terms of the contract shall be the law between
the parties." [10]

The NLRC also declared that the Magna Carta for Disabled Persons was not applicable, "considering the
prevailing circumstances/milieu of the case."

Issues

In their Memorandum, petitioners cite the following grounds in support of their cause:

"I. The Honorable Commission committed grave abuse of discretion in holding that the petitioners — money
sorters and counters working in a bank — were not regular employees.

"II. The Honorable Commission committed grave abuse of discretion in holding that the employment contracts
signed and renewed by the petitioners — which provide for a period of six (6) months — were valid.

"III. The Honorable Commission committed grave abuse of discretion in not applying the provisions of the
Magna Carta for the Disabled (Republic Act No. 7277), on proscription against discrimination against disabled
persons." [11]

24
In the main, the Court will resolve whether petitioners have become regular employees.

This Court's Ruling

The petition is meritorious. However, only the employees, who worked for more than six months and whose
contracts were renewed are deemed regular. Hence, their dismissal from employment was illegal.

Preliminary Matter:
Propriety of Certiorari

Respondent Far East Bank and Trust Company argues that a review of the findings of facts of the NLRC is not
allowed in a petition for certiorari. Specifically, it maintains that the Court cannot pass upon the findings of
public respondents that petitioners were not regular employees. prcd

True, the Court, as a rule,does not review the factual findings of public respondents in a certiorari proceeding.
In resolving whether the petitioners have become regular employees, we shall not change the facts found by the
public respondent. Our task is merely to determine whether the NLRC committed grave abuse of discretion in
applying the law to the established facts, as above-quoted from the assailed Decision.

Main Issue:
Are Petitioners Regular Employees?

Petitioners maintain that they should be considered regular employees, because their task as money sorters and
counters was necessary and desirable to the business of respondent bank. They further allege that their contracts
served merely to preclude the application of Article 280 and to bar them from becoming regular employees.

Private respondent, on the other hand, submits that petitioners were hired only as "special workers and should
not in any way be considered as part of the regular complement of the Bank." [12] Rather, they were "special"
workers under Article 80 of the Labor Code.Private respondent contends that it never solicited the services of
petitioners, whose employment was merely an "accommodation" in response to the requests of government
officials and civic-minded citizens. They were told from the start, "with the assistance of government
representatives," that they could not become regular employees because there were no plantilla positions for
"money sorters," whose task used to be performed by tellers. Their contracts were renewed several times, not
because of need "but merely for humanitarian reasons." Respondent submits that "as of the present, the 'special
position' that was created for the petitioners no longer exist[s] in private respondent [bank], after the latter had
decided not to renew anymore their special employment contracts." cdphil

At the outset, let it be known that this Court appreciates the nobility of private respondent's effort to provide
employment to physically impaired individuals and to make them more productive members of society.
However, we cannot allow it to elude the legal consequences of that effort, simply because it now deems their
employment irrelevant. The facts, viewed in light of the Labor Code and the Magna Carta for Disabled Persons,
indubitably show that the petitioners, except sixteen of them, should be deemed regular employees. As such,
they have acquired legal rights that this Court is duty-bound to protect and uphold, not as a matter of
compassion but as a consequence of law and justice.

The uniform employment contracts of the petitioners stipulated that they shall be trained for a period of one
month, after which the employer shall determine whether or not they should be allowed to finish the 6-month
term of the contract. Furthermore, the employer may terminate the contract at any time for a just and reasonable
cause. Unless renewed in writing by the employer, the contract shall automatically expire at the end of the term.

According to private respondent, the employment contracts were prepared in accordance with Article 80 of the
Labor Code,which provides:

"ARTICLE 80. Employment agreement.— Any employer who employs handicapped workers shall enter into an
employment agreement with them, which agreement shall include:

(a) The names and addresses of the handicapped workers to be employed;

(b) The rate to be paid the handicapped workers which shall be not less than seventy five (75%) per cent of the
applicable legal minimum wage;

(c) The duration of employment period; and

(d) The work to be performed by handicapped workers.

25
The employment agreement shall be subject to inspection by the Secretary of Labor or his duly authorized
representatives."

The stipulations in the employment contracts indubitably conform with the aforecited provision. Succeeding
events and the enactment of RA No. 7277 (the Magna Carta for Disabled Persons), [13] however, justify the
application of Article 280 of the Labor Code.

Respondent bank entered into the aforesaid contract with a total of 56 handicapped workers and renewed the
contracts of 37 of them. In fact, two of them worked from 1988 to 1993. Verily, the renewal of the contracts of
the handicapped workers and the hiring of others lead to the conclusion that their tasks were beneficial and
necessary to the bank. More important, these facts show that they were qualified to perform the responsibilities
of their positions. In other words, their disability did not render them unqualified or unfit for the tasks assigned
to them.

In this light, the Magna Carta for Disabled Persons mandates that a qualified disabled employee should be given
the same terms and conditions of employment as a qualified able-bodied person. Section 5 of the Magna Carta
provides: cdll

"SECTION 5. Equal Opportunity for Employment.— No disabled person shall be denied access to opportunities
for suitable employment. A qualified disabled employee shall be subject to the same terms and conditions of
employment and the same compensation, privileges, benefits, fringe benefits, incentives or allowances as a
qualified able-bodied person."

The fact that the employees were qualified disabled persons necessarily removes the employment contracts
from the ambit of Article 80. Since the Magna Carta accords them the rights of qualified able-bodied persons,
they are thus covered by Article 280 of the Labor Code, which provides:

"ARTICLE 280. Regular and Casual Employment.— The provisions of written agreement to the contrary
notwithstanding and regardless of the oral agreement of the parties, an employment shall be deemed to be
regular where the employee has been engaged to perform activities which are usually necessary or desirable in
the usual business or trade of the employer, except where the employment has been fixed for a specific project
or undertaking the completion or termination of which has been determined at the time of the engagement of the
employee or where the work or services to be performed is seasonal in nature and the employment is for the
duration of the season.

"An employment shall be deemed to be casual if it is not covered by the preceding paragraph: Provided, That,
any employee who has rendered at least one year of service, whether such service is continuous or broken, shall
be considered as regular employee with respect to the activity in which he is employed and his employment
shall continue while such activity exists."

The test of whether an employee is regular was laid down in De Leon v. NLRC , [14] in which this Court held:

"The primary standard, therefore, of determining regular employment is the reasonable connection between the
particular activity performed by the employee in relation to the usual trade or business of the employer. The test
is whether the former is usually necessary or desirable in the usual business or trade of the employer. The
connection can be determined by considering the nature of the work performed and its relation to the scheme of
the particular business or trade in its entirety. Also if the employee has been performing the job for at least one
year, even if the performance is not continuous and merely intermittent, the law deems repeated and continuing
need for its performance as sufficient evidence of the necessity if not indispensability of that activity to the
business. Hence, the employment is considered regular, but only with respect to such activity, and while such
activity exists."

Without a doubt, the task of counting and sorting bills is necessary and desirable to the business of respondent
bank. With the exception of sixteen of them, petitioners performed these tasks for more than six months. Thus,
the following twenty-seven petitioners should be deemed regular employees: Marites Bernardo, Elvira Go
Diamante, Rebecca E. David, David P. Pascual, Raquel Estiller, Albert Hallare, Edmund M. Cortez, Joselito O.
Agdon, George P. Ligutan Jr.,Lilibeth Q. Marmolejo, Jose E. Sales, Isabel Mamauag, Violeta G. Montes, Albino
Tecson, Melody V. Gruela, Bernadeth D. Agero, Cynthia de Vera, Lani R. Cortez, Ma. Isabel B. Concepcion,
Margaret Cecilia Canoza, Thelma Sebastian, Ma. Jeanette Cervantes, Jeannie Ramil, Rozaida Pascual, Pinky
Baloloa, Elizabeth Ventura and Grace S. Pardo. Cdpr

As held by the Court, "Articles 280 and 281 of the Labor Code put an end to the pernicious practice of making
permanent casuals of our lowly employees by the simple expedient of extending to them probationary

26
appointments, ad infinitum." [15] The contract signed by petitioners is akin to a probationary employment,
during which the bank determined the employees' fitness for the job. When the bank renewed the contract after
the lapse of the six-month probationary period, the employees thereby became regular employees. [16] No
employer is allowed to determine indefinitely the fitness of its employees.

As regular employees, the twenty-seven petitioners are entitled to security of tenure; that is, their services may
be terminated only for a just or authorized cause. Because respondent failed to show such cause, [17] these
twenty-seven petitioners are deemed illegally dismissed and therefore entitled to back wages and reinstatement
without loss of seniority rights and other privileges. [18] Considering the allegation of respondent that the job of
money sorting is no longer available because it has been assigned back to the tellers to whom it originally
belonged, [19] petitioners are hereby awarded separation pay in lieu of reinstatement. [20]

Because the other sixteen worked only for six months, they are not deemed regular employees and hence not
entitled to the same benefits.
Applicability of the Brent Ruling

Respondent bank, citing Brent School v. Zamora, [21] in which the Court upheld the validity of an employment
contract with a fixed term, argues that the parties entered into the contract on equal footing. It adds that the
petitioners had in fact an advantage, because they were backed by then DSWD Secretary Mita Pardo de Tavera
and Representative Arturo Borjal.

We are not persuaded. The term limit in the contract was premised on the fact that the petitioners were disabled,
and that the bank had to determine their fitness for the position. Indeed, its validity is based on Article 80 of the
Labor Code.But as noted earlier, petitioners proved themselves to be qualified disabled persons who, under the
Magna Carta for Disabled Persons, are entitled to terms and conditions of employment enjoyed by qualified
able-bodied individuals; hence, Article 80 does not apply because petitioners are qualified for their positions.
The validation of the limit imposed on their contracts, imposed by reason of their disability, was a glaring
instance of the very mischief sought to be addressed by the new law.

Moreover, it must be emphasized that a contract of employment is impressed with public interest. [22]
Provisions of applicable statutes are deemed written into the contract, and the "parties are not at liberty to
insulate themselves and their relationships from the impact of labor laws and regulations by simply contracting
with each other." [23] Clearly, the agreement of the parties regarding the period of employment cannot prevail
over the provisions of the Magna Carta for Disabled Persons, which mandate that petitioners must be treated as
qualified able-bodied employees. Cdpr

Respondent's reason for terminating the employment of petitioners is instructive. Because the Bangko Sentral
ng Pilipinas (BSP) required that cash in the bank be turned over to the BSP during business hours from 8:00
a.m. to 5:00 p.m.,respondent resorted to nighttime sorting and counting of money. Thus, it reasons that this task
"could not be done by deaf mutes because of their physical limitations as it is very risky for them to travel at
night." [24] We find no basis for this argument. Travelling at night involves risks to handicapped and able-
bodied persons alike. This excuse cannot justify the termination of their employment.
Other Grounds Cited by Respondent

Respondent argues that petitioners were merely "accommodated" employees. This fact does not change the
nature of their employment. As earlier noted, an employee is regular because of the nature of work and the
length of service, not because of the mode or even the reason for hiring them.

Equally unavailing are private respondent's arguments that it did not go out of its way to recruit petitioners, and
that its plantilla did not contain their positions. In L. T . Datu v. NLRC, [25] the Court held that "the
determination of whether employment is casual or regular does not depend on the will or word of the employer,
and the procedure of hiring ...but on the nature of the activities performed by the employee, and to some extent,
the length of performance and its continued existence."

Private respondent argues that the petitioners were informed from the start that they could not become regular
employees. In fact, the bank adds, they agreed with the stipulation in the contract regarding this point. Still, we
are not persuaded. The well-settled rule is that the character of employment is determined not by stipulations in
the contract, but by the nature of the work performed. [26] Otherwise, no employee can become regular by the
simple expedient of incorporating this condition in the contract of employment.

In this light, we iterate our ruling in Romares v. NLRC : [27]

27
"Article 280 was emplaced in our statute books to prevent the circumvention of the employee's right to be
secure in his tenure by indiscriminately and completely ruling out all written and oral agreements inconsistent
with the concept of regular employment defined therein. Where an employee has been engaged to perform
activities which are usually necessary or desirable in the usual business of the employer, such employee is
deemed a regular employee and is entitled to security of tenure notwithstanding the contrary provisions of his
contract of employment. cda

"xxx xxx xxx

"At this juncture, the leading case of Brent School, Inc. v. Zamora proves instructive. As reaffirmed in
subsequent cases, this Court has upheld the legality of fixed-term employment. It ruled that the decisive
determinant in 'term employment' should not be the activities that the employee is called upon to perform but
the day certain agreed upon the parties for the commencement and termination of their employment
relationship. But this Court went on to say that where from the circumstances it is apparent that the periods have
been imposed to preclude acquisition of tenurial security by the employee, they should be struck down or
disregarded as contrary to public policy and morals."

In rendering this Decision, the Court emphasizes not only the constitutional bias in favor of the working class,
but also the concern of the State for the plight of the disabled. The noble objectives of Magna Carta for Disabled
Persons are not based merely on charity or accommodation, but on justice and the equal treatment of qualified
persons, disabled or not. In the present case, the handicap of petitioners (deaf-mutes) is not a hindrance to their
work. The eloquent proof of this statement is the repeated renewal of their employment contracts. Why then
should they be dismissed, simply because they are physically impaired? The Court believes, that, after showing
their fitness for the work assigned to them, they should be treated and granted the same rights like any other
regular employees.

In this light, we note the Office of the Solicitor General's prayer joining the petitioners' cause. [28]

WHEREFORE,premises considered, the Petition is hereby GRANTED. The June 20, 1995 Decision and the
August 4, 1995 Resolution of the NLRC are REVERSED and SET ASIDE. Respondent Far East Bank and
Trust Company is hereby ORDERED to pay back wages and separation pay to each of the following twenty-
seven (27) petitioners, namely, Marites Bernardo, Elvira Go Diamante, Rebecca E. David, David P. Pascual,
Raquel Estiller, Albert Hallare, Edmund M. Cortez, Joselito O. Agdon, George P. Ligutan Jr.,Lilibeth Q.
Marmolejo, Jose E. Sales, Isabel Mamauag, Violeta G. Montes, Albino Tecson, Melody V. Gruela, Bernadeth D.
Agero, Cynthia de Vera, Lani R. Cortez, Ma. Isabel B. Concepcion, Margaret Cecilia Canoza, Thelma
Sebastian, Ma. Jeanette Cervantes, Jeannie Ramil, Rozaida Pascual, Pinky Baloloa, Elizabeth Ventura and
Grace S. Pardo. The NLRC is hereby directed to compute the exact amount due each of said employees,
pursuant to existing laws and regulations, within fifteen days from the finality of this Decision. No costs.
LibLex

SO ORDERED.

Romero, Vitug, Purisima and Gonzaga-Reyes, JJ., concur.

(Bernardo v. National Labor Relations Commission, G.R. No. 122917, (12 July 1999), 369 Phil 443-464)

28
[G.R. No. 118978. May 23, 1997.]

PHILIPPINE TELEGRAPH AND TELEPHONE COMPANY, [*] petitioner,vs.NATIONAL LABOR

RELATIONS COMMISSION and GRACE DE GUZMAN, respondents.

D. P. Mercado & Associates for petitioner.

AC Estrada & Partner for private respondent.

SYLLABUS
1. LABOR AND SOCIAL LEGISLATION; LABOR CODE; EMPLOYMENT; EMPLOYER'S POLICY OF
NOT ACCEPTING FOR WORK ANY WOMAN WORKER WHO CONTRACTS MARRIAGE, CONTRARY
TO LAW, GOOD MORALS AND PUBLIC POLICY. — In the case at bar, petitioner's policy of not accepting
or considering as disqualified from work any woman worker who contracts marriage runs afoul of the test of,
and the right against, discrimination, afforded all women workers by our labor laws and by no less than the
Constitution. Petitioner's policy is not only in derogation of the provisions of Article 136 of the Labor Code on
the right of a woman to be free from any kind of stipulation against marriage in connection with her
employment, but it likewise assaults good morals and public policy, tending as it does to deprive a woman of
the freedom to choose her status, a privilege that by all accounts inheres in the individual as an intangible and
inalienable right. Hence, while it is true that the parties to a contract may establish any agreements, terms, and
conditions that they may deem convenient the same should not be contrary to law, morals, good customs, public
order, or public policy. Carried to its logical consequences, it may even be said that petitioner's policy against
legitimate marital bonds would encourage illicit or common-law relations and subvert the sacrament of
marriage.

2. ID.;ID.;ID.;DISMISSAL; LOSS OF CONFIDENCE, VALID GROUND. — While loss of confidence is a

just cause of termination of employment, it should not be simulated. It must rest on an actual breach of duty
committed by the employee and not on the employer's caprices. Furthermore, it should never be used as a
subterfuge for causes which are improper, illegal, or unjustified.

3. ID.;ID.;ID.;ID.;ID.;CONCEALMENT OF FEMALE EMPLOYEE OF TRUE NATURE OF STATUS FOR

FEAR OF BEING DISQUALIFIED FROM WORK, NOT SUFFICIENT BASIS. — Contrary to petitioner's
assertion that it dismissed private respondent from employment on account of her dishonesty, the record
discloses clearly that her ties with the company were dissolved principally because of the company's policy that
married women are not qualified for employment in PT & T, and not merely because of her supposed acts of
dishonesty. Private respondent's act of concealing the true nature of her status from PT & T could not be
properly characterized as willful or in bad faith as she was moved to act the way she did mainly because she
wanted to retain a permanent job in a stable company. In other words, she was practically forced by that very
same illegal company policy into misrepresenting her civil status for fear of being disqualified from work.

4. ID.;ID.;ID.;ID.;FAILURE TO REMIT COMPANY FUNDS, NOT AN ADDITIONAL GROUND; CASE AT

BAR. — Finally, petitioner's collateral insistence on the admission of private respondent that she supposedly
misappropriated company funds, as an additional ground to dismiss her from employment, is somewhat
insincere and self-serving. Concededly, private respondent admitted in the course of the proceedings that she
failed to remit some of her collections, but that is an altogether different story. The fact is that she was dismissed
solely because of her concealment of her marital status, and not on the basis of that supposed defalcation of
company funds. That the labor arbiter would thus consider petitioner's submissions on this a mere afterthought,
just too bolster its supposed dishonesty as case for dismissal, is a perceptive conclusion born of experience in
labor cases. For, there was no showing that private respondent deliberately misappropriated the amount or
whether her failure to remit the same was through negligence and, if so, whether the negligence was in nature
simple or grave. In fact, it was merely agreed that private respondent execute a promissory note to refund the
same, which she did, and the matter was deemed settled as a peripheral issue in the labor case.

5. ID.;ID.;ID.,EMPLOYEE ILLEGALLY DISMISSED A FEW DAYS BEFORE COMPLETION OF HER

PROBATIONARY EMPLOYMENT AND WHO WAS PREVIOUSLY HIRED RELIEVER FOR SEVERAL
TIMES GAINED REGULAR STATUS. — Private respondent, it must be observed, had gained regular status at
the time of her dismissal. When she was served her walking papers on January 29, 1992, she was about to
complete the probationary period of 150 days as she was contracted as a probationary employee on September
2, 1991. That her dismissal would be effected just when her probationary period was winding down clearly
raises the plausible conclusion that it was done in order to prevent her from earning security of tenure. On the
other hand, her earlier stints with the company as reliever were undoubtedly those of a regular employee, even

29
if the same were for fixed periods, as she performed activities which were essential or necessary in the usual
trade and business of PT & T. The primary standard of determining regular employment is the reasonable
connection between the activity performed by the employee in relation to the business or trade of the employer.

6. ID.;ID.;ID.;ID.;ENTITLED TO REINSTATEMENT WITHOUT LOSS OF SENIORITY RIGHTS AND

OTHER PRIVILEGES. — As an employee who had therefore gained regular status, and as she had been
dismissed without just cause, she is entitled to reinstatement without loss of seniority rights and other privileges
and to full back wages, inclusive of allowances and other benefits or their monetary equivalent.

7. ID.;ID.;ID.;ID.;ID; PERIOD OF SUSPENSION FOR DISHONESTY DEDUCTED FROM AMOUNT

RECOVERABLE FOR ILLEGAL DISMISSAL. — However, as she had undeniably committed an act of
dishonesty, in concealing her status, albeit under the compulsion of an unlawful imposition of petitioner, the
three-month suspension imposed by respondent NLRC must be upheld to obviate the impression or inference
that such act should be condoned. It would be unfair to the employer if she were to return to its fold without any
sanction whatsoever for her act which was not totally, justified. Thus, her entitlement to back wages, which
shall be computed from the time her compensation was withheld up to the time of her actual reinstatement, shall
be reduced by, deducting therefrom the amount corresponding to her three months suspension.

8. CIVIL LAW; OBLIGATIONS AND CONTRACTS; CONTRACT OF LABOR; IMPRESSED WITH

PUBLIC POLICY SHOULD NOT CONTAIN OPPRESSIVE PROVISIONS NOR IMPAIR THE INTEREST
OR CONVENIENCE OF THE PUBLIC; POLICY AGAINST MARRIAGE, A PROHIBITED PROVISION. —
Parenthetically, the Civil Code provisions on the contract of labor state that the relations between the parties,
that is, of capital and labor, are not merely, contractual, impressed as they are with so much public interest that
the same should yield to the common good. It goes on to intone dust neither capital nor labor should visit acts of
oppression against the other, nor impair the interest or convenience of the public. In the final reckoning, the
danger of just such a policy against marriage followed by petitioner PT & T is that it strikes at the very essence,
ideals and purpose of marriage as an inviolable social institution and. ultimately, of the family as the foundation
of the nation. That it must be effectively interdicted here in all its indirect, disguised or dissembled forms as
discriminatory conduct derogatory of the laws of the land is not only in order but imperatively required.

DECISION
REGALADO, J p:

Seeking relief through the extraordinary writ of certiorari, petitioner Philippine Telegraph and Telephone
Company (hereafter, PT&T) invokes the alleged concealment of civil status and defalcation of company funds
as grounds to terminate the services of an employee. That employee, herein private respondent Grace de
Guzman, contrarily argues that what really motivated PT&T to terminate her services was her having contracted
marriage during her employment, which is prohibited by petitioner in its company policies. She thus claims that
she was discriminated against in gross violation of law, such a proscription by an employer being outlawed by
Article 136 of the Labor Code.

Grace de Guzman was initially hired by petitioner as a reliever, specifically as a "Supernumerary Project
Worker," for a fixed period from November 21, 1990 until April 20, 1991 vice one C.F. Tenorio who went on
maternity leave. [1] Under the Reliever Agreement which she signed with petitioner company, her employment
was to be immediately terminated upon expiration of the agreed period. Thereafter, from June 10, 1991 to July
1, 1991, and from July 19, 1991 to August 8, 1991, private respondent' s services as reliever were again engaged
by petitioner, this time in replacement of one Erlinda F. Dizon who went on leave during both periods. [2] After
August 8, 1991, and pursuant to their Reliever Agreement, her services were terminated. LibLex

On September 2, 1991, private respondent was once more asked to join petitioner company as a probationary
employee, the probationary period to cover 150 days. In the job application form that was furnished her to be
filled up for the purpose, she indicated in the portion for civil status therein that she was single although she had
contracted marriage a few months earlier, that is, on May 26, 1991. [3]

It now appears that private respondent had made the same representation in the two successive reliever
agreements which she signed on June 10, 1991 and July 8, 1991. When petitioner supposedly learned about the
same later, its branch supervisor in Baguio City, Delia M. Oficial, sent to private respondent a memorandum
dated January 15, 1992 requiring her to explain the discrepancy. In that memorandum, she was reminded about
the company's policy of not accepting married women for employment. [4]

In her reply letter dated January 17, 1992, private respondent stated that she was not aware of PT&T's policy
regarding married women at the time, and that all along she had not deliberately hidden her true civil status. [5]
30
Petitioner nonetheless remained unconvinced by her explanations. Private respondent was dismissed from the
company effective January 29, 1992, [6] which she readily contested by initiating a complaint for illegal
dismissal, coupled with a claim for non-payment of cost of living allowances (COLA), before the Regional
Arbitration Branch of the National Labor Relations Commission in Baguio City.

At the preliminary conference conducted in connection therewith, private respondent volunteered the
information, and this was incorporated in the stipulation of facts between the parties, that she had failed to remit
the amount of P2,380.75 of her collections. She then executed a promissory note for that amount in favor of
petitioner. [7] All of these took place in a formal proceeding and with the agreement of the parties and/or their
counsel.

On November 23, 1993, Labor Arbiter Irenarco R. Rimando handed down a decision declaring that private
respondent, who had already gained the status of a regular employee, was illegally dismissed by petitioner. Her
reinstatement, plus payment of the corresponding back wages and COLA, was correspondingly ordered, the
labor arbiter being of the firmly expressed view that the ground relied upon by petitioner in dismissing private
respondent was clearly insufficient, and that it was apparent that she had been discriminated against on account
of her having contracted marriage in violation of company rules.

On appeal to the National Labor Relations Commission (NLRC),said public respondent upheld the labor arbiter
and, in its decision dated April 29, 1994, it ruled that private respondent had indeed been the subject of an
unjust and unlawful discrimination by her employer, PT&T. However, the decision of the labor arbiter was
modified with the qualification that Grace de Guzman deserved to be suspended for three months in view of the
dishonest nature of her acts which should not be condoned. In all other respects, the NLRC affirmed the
decision of the labor arbiter, including the order for the reinstatement of private respondent in her employment
with PT&T.

The subsequent motion for reconsideration filed by petitioner was rebuffed by respondent NLRC in its
resolution of November 9, 1994, hence this special civil action assailing the aforestated decisions. of the labor
arbiter and respondent NLRC, as well as the denial resolution of the latter.

1. Decreed in the Bible itself is the universal norm that women should be regarded with love and respect but,
through the ages, men have responded to that injunction with indifference, on the hubristic conceit that women
constitute the inferior sex. Nowhere has that prejudice against womankind been so pervasive as in the field of
labor, especially on the matter of equal employment opportunities and standards. In the Philippine setting,
women have traditionally been considered as falling within the vulnerable groups or types of workers who must
be safeguarded with preventive and remedial social legislation against discriminatory and exploitative practices
in hiring, training, benefits, promotion and retention.

The Constitution, cognizant of the disparity in rights between men and women in almost all phases of social and
political life, provides a gamut of protective provisions. To cite a few of the primordial ones, Section 14, Article
II [8] on the Declaration of Principles and State Policies, expressly recognizes the role of women in nation-
building and commands the State to ensure, at all times, the fundamental equality before the law of women and
men. Corollary thereto, Section 3 of Article XIII [9] (the progenitor whereof dates back to both the 1935 and
1973 Constitution) pointedly requires the State to afford full protection to labor and to promote full employment
and equality of employment opportunities for all, including an assurance of entitlement to tenurial security of all
workers. Similarly, Section 14 of Article XIII [10] mandates that the State shall protect working women through
provisions for opportunities that would enable them to reach their full potential.

2. Corrective labor and social laws on gender inequality have emerged with more frequency in the years since
the Labor Code was enacted on May 1, 1974 as Presidential Decree No. 442, largely due to our country's
commitment as a signatory to the United Nations Convention on the Elimination of All Forms of Discrimination
Against Women (CEDAW). [11]

Principal among these laws are Republic Act No. 6727 [12] which explicitly prohibits discrimination against
women with respect to terms and conditions of employment, promotion, and training opportunities, Republic
Act No. 6955 [13] which bans the "mail-order-bride" practice for a fee and the export of female labor to
countries that cannot guarantee protection to the rights of women workers; Republic Act No. 7192, [14] also
known as the "Women in Development and Nation Building Act," which affords women equal opportunities
with men to act and to enter into contracts, and for appointment, admission, training, graduation, and
commissioning in all military or similar schools of the Armed Forces of the Philippines and the Philippine
National Police; Republic Act No. 7322 [15] increasing the maternity benefits granted to women in the private
sector; Republic Act No. 7877 [16] which outlaws and punishes sexual harassment in the workplace and in the
31
education and training environment; and Republic Act No. 8042, [17] or the "Migrant Workers and Overseas
Filipinos Act of 1995," which prescribes as a matter of policy, inter alia, the deployment of migrant workers,
with emphasis on women, only in countries where their rights are secure. Likewise, it would not be amiss to
point out that in the Family Code, [18] women's rights in the field of civil law have been greatly enhanced and
expanded.

In the Labor Code, provisions governing the rights of women workers are found in Articles 130 to 138 thereof.
Article 130 involves the right against particular kinds of night work while Article 132 ensures the right of
women to be provided with facilities and standards which the Secretary of Labor may establish to ensure their
health and safety. For purposes of labor and social legislation, a woman working in a nightclub, cocktail lounge,
massage clinic, bar or other similar establishments shall be considered as an employee under Article 138. Article
135, on the other hand, recognizes a woman' s right against discrimination with respect to terms and conditions
of employment on account simply of sex. Finally, and this brings us to the issue at hand, Article 136 explicitly
prohibits discrimination merely by reason of the marriage of a female employee.

3. Acknowledged as paramount in the due process scheme is the constitutional guarantee of protection to labor
and security of tenure. Thus, an employer is required, as a condition sine qua non prior to severance of the
employment ties of an individual under his employ, to convincingly establish, through substantial evidence, the
existence of a valid and just cause in dispensing with the services of such employee, one' s labor being regarded
as constitutionally protected property.

On the other hand, it is recognized that regulation of manpower by the company falls within the so-called
management prerogatives, which prescriptions encompass the matter of hiring, supervision of workers, work
assignments, working methods and assignments, as well as regulations on the transfer of employees, lay-off of
workers, and the discipline, dismissal, and recall of employees. [19] As put in a case, an employer is free to
regulate, according to his discretion and best business judgment, all aspects of employment, "from hiring to
firing," except in cases of unlawful discrimination or those which may be provided by law. [20]

In the case at bar, petitioner's policy of not accepting or considering as disqualified from work any woman
worker who contracts marriage runs afoul of the test of, and the right against, discrimination, afforded all
women workers by our labor laws and by no less than the Constitution. Contrary to petitioner's assertion that it
dismissed private respondent from employment on account of her dishonesty, the record discloses clearly that
her ties with the company were dissolved principally because of the company's policy that married women are
not qualified for employment in PT&T, and not merely because of her supposed acts of dishonesty.

That it was so can easily be seen from the memorandum sent to private respondent by Delia M. Oficial, the
branch supervisor of the company, with the reminder, in the words of the latter, that "you're fully aware that the
company is not accepting married women employee (sic), as it was verbally instructed to you." [21] Again, in
the termination notice sent to her by the same branch supervisor, private respondent was made to understand
that her severance from the service was not only by reason of her concealment of her married status but, over
and on top of that, was her violation of the company' s policy against marriage ("and even told you that married
women employees are not applicable [sic] or accepted in our company.") [22] Parenthetically, this seems to be
the curious reason why it was made to appear in the initiatory pleadings that petitioner was represented in this
case only by its said supervisor and not by its highest ranking officers who would otherwise be solidarily liable
with the corporation. [23]

Verily, private respondent's act of concealing the true nature of her status from PT&T could not be properly
characterized as willful or in bad faith as she was moved to act the way she did mainly because she wanted to
retain a permanent job in a stable company. In other words, she was practically forced by that very same illegal
company policy into misrepresenting her civil status for fear of being disqualified from work. While loss of
confidence is a just cause for termination of employment, it should not be simulated. [24] It must rest on an
actual breach of duty committed by the employee and not on the employer's caprices. [25] Furthermore, it
should never be used as a subterfuge for causes which are improper, illegal, or unjustified. [26] LLphil

In the present controversy, petitioner's expostulations that it dismissed private respondent, not because the latter
got married but because she concealed that fact, does have a hollow ring. Her concealment, so it is claimed,
bespeaks dishonesty hence the consequent loss of confidence in her which justified her dismissal. Petitioner
would asseverate, therefore, that while it has nothing against marriage, it nonetheless takes umbrage over the
concealment of that fact. This improbable reasoning, with interstitial distinctions, perturbs the Court since
private respondent may well be minded to claim that the imputation of dishonesty should be the other way
around.

32
Petitioner would have the Court believe that although private respondent defied its policy against its female
employees contracting marriage, what could be an act of insubordination was inconsequential. What it submits
as unforgivable is her concealment of that marriage yet, at the same time, declaring that marriage as a trivial
matter to which it supposedly has no objection. In other words, PT&T says it gives its blessings to its female
employees contracting marriage, despite the maternity leaves and other benefits it would consequently respond
for and which obviously it would have wanted to avoid. If that employee confesses such fact of marriage, there
will be no sanction; but if such employee conceals the same instead of proceeding to the confessional, she will
be dismissed. This line of reasoning does not impress us as reflecting its true management policy or that we are
being regaled with responsible advocacy.

This Court should be spared the ennui of strained reasoning and the tedium of propositions which confuse
through less than candid arguments. Indeed, petitioner glosses over the fact that it was its unlawful policy
against married women, both on the aspects of qualification and retention, which compelled private respondent
to conceal her supervenient marriage. It was, however, that very policy alone which was the cause of private
respondent's secretive conduct now complained of. It is then apropos to recall the familiar saying that he who is
the cause of the cause is the cause of the evil caused.

Finally, petitioner's collateral insistence on the admission of private respondent that she supposedly
misappropriated company funds, as an additional ground to dismiss her from employment, is somewhat
insincere and self-serving. Concededly, private respondent admitted in the course of the proceedings that she
failed to remit some of her collections, but that is an altogether different story. The fact is that she was dismissed
solely because of her concealment of her marital status, and not on the basis of that supposed defalcation of
company funds. That the labor arbiter would thus consider petitioner's submissions on this supposed dishonesty
as a mere afterthought, just to bolster its case for dismissal, is a perceptive conclusion born of experience in
labor cases. For, there was no showing that private respondent deliberately misappropriated the amount or
whether her failure to remit the same was through negligence and, if so, whether the negligence was in nature
simple or grave. In fact, it was merely agreed that private respondent execute a promissory note to refund the
same, which she did, and the matter was deemed settled as a peripheral issue in the labor case.

Private respondent, it must be observed, had gained regular status at the time of her dismissal. When she was
served her walking papers on January 29, 1992, she was about to complete the probationary period of 150 days
as she was contracted as a probationary employee on September 2, 1991. That her dismissal would be effected
just when her probationary period was winding down clearly raises the plausible conclusion that it was done in
order to prevent her from earning security of tenure. [27] On the other hand, her earlier stints with the company
as reliever were undoubtedly those of a regular employee, even if the same were for fixed periods, as she
performed activities which were essential or necessary in the usual trade and business of PT&T. [28] The
primary standard of determining regular employment is the reasonable connection between the activity
performed by the employee in relation to the business or trade of the employer. [29]

As an employee who had therefore gained regular status, and as she had been dismissed without just cause, she
is entitled to reinstatement without loss of seniority rights and other privileges and to full back wages, inclusive
of allowances and other benefits or their monetary equivalent. [30] However, as she had undeniably committed
an act of dishonesty in concealing her status, albeit under the compulsion of an unlawful imposition of
petitioner, the three-month suspension imposed by respondent NLRC must be upheld to obviate the impression
or inference that such act should be condoned. It would be unfair to the employer if she were to return to its fold
without any sanction whatsoever for her act which was not totally justified. Thus, her entitlement to back
wages, which shall be computed from the time her compensation was withheld up to the time of her actual
reinstatement, shall be reduced by deducting therefrom the amount corresponding to her three months
suspension.

4. The government, to repeat, abhors any stipulation or policy in the nature of that adopted by petitioner PT&T.
The Labor Code states, in no uncertain terms, as follows:

"ART. 136. Stipulation against marriage.— It shall be unlawful for an employer to require as a condition of
employment or continuation of employment that a woman shall not get married, or to stipulate expressly or
tacitly that upon getting married, a woman employee shall be deemed resigned or separated, or to actually
dismiss, discharge, discriminate or otherwise prejudice a woman employee merely by reason of marriage."

This provision had a studied history for its origin can be traced to Section 8 of Presidential Decree No. 148, [31]
better known as the "Women and Child Labor Law," which amended paragraph (c), Section 12 of Republic Act
No. 679, [32] entitled "An Act to Regulate the Employment of Women and Children, to Provide Penalties for

33
Violations Thereof, and for Other Purposes." The forerunner to Republic Act No. 679, on the other hand, was
Act No. 3071 which became law on March 16, 1923 and which regulated the employment of women and
children in shops, factories, industrial, agricultural, and mercantile establishments and other places of labor in
the then Philippine Islands.

It would be worthwhile to reflect upon and adopt here the rationalization in Zialcita, et al. vs. Philippine Air
Lines, [33] a decision that emanated from the Office of the President. There, a policy of Philippine Air Lines
requiring that prospective flight attendants must be single and that they will be automatically separated from the
service once they marry was declared void, it being violative of the clear mandate in Article 136 of the Labor
Code with regard to discrimination against married women. Thus:

"Of first impression is the incompatibility of the respondent's policy or regulation with the codal provision of
law. Respondent is resolute in its contention that Article 136 of the Labor Code applies only to women
employed in ordinary occupations and that the prohibition against marriage of women engaged in extraordinary
occupations, like flight attendants, is fair and reasonable, considering the peculiarities of their chosen
profession.

We cannot subscribe to the line of reasoning pursued by respondent. All along, it knew that the controverted
policy has already met its doom as early as March 13, 1973 when Presidential Decree No. 148, otherwise
known as the Women and Child Labor Law, was promulgated. But for the timidity of those affected or their
labor unions in challenging the validity of the policy, the same was able to obtain a momentary reprieve. A close
look at Section 8 of said decree, which amended paragraph (c) of Section 12 of Republic Act No. 679, reveals
that it is exactly the same provision reproduced verbatim in Article 136 of the Labor Code,which was
promulgated on May 1, 1974 to take effect six (6) months later, or on November 1, 1974.

It cannot be gainsaid that, with the reiteration of the same provision in the new Labor Code, all policies and acts
against it are deemed illegal and therefore abrogated. True, Article 132 enjoins the Secretary of Labor to
establish standards that will ensure the safety and health of women employees and in appropriate cases shall by
regulation require employers to determine appropriate minimum standards for termination in special
occupations, such as those of flight attendants, but that is precisely the factor that militates against the policy of
respondent. The standards have not yet been established as set forth in the first paragraph, nor has the Secretary
of Labor issued any regulation affecting flight attendants.

It is logical to presume that, in the absence of said standards or regulations which are as yet to be established,
the policy of respondent against marriage is patently illegal. This finds support in Section 9 of the New
Constitution, which provides:

"Sec. 9. The State shall afford protection to labor, promote full employment and equality in employment, ensure
equal work opportunities regardless of sex, race, or creed, and regulate the relations between workers and
employees. The State shall assure the rights of workers to self-organization, collective bargaining, security of
tenure, and just and humane conditions of work ..."

Moreover, we cannot agree to the respondent's proposition that termination from employment of flight
attendants on account of marriage is a fair and reasonable standard designed for their own health, safety,
protection and welfare, as no basis has been laid therefor. Actually, respondent claims that its concern is not so
much against the continued employment of the flight attendant merely by reason of marriage as observed by the
Secretary of Labor, but rather on the consequence of marriage-pregnancy. Respondent discussed at length in the
instant appeal the supposed ill effects of pregnancy on flight attendants in the course of their employment. We
feel that this needs no further discussion as it had been adequately explained by the Secretary of Labor in his
decision of May 2, 1976. cdll

In a vain attempt to give meaning to its position, respondent went as far as invoking the provisions of Articles
52 and 216 of the New Civil Code on the preservation of marriage as an inviolable social institution and the
family as a basic social institution, respectively, as bases for its policy of non-marriage. In both instances,
respondent predicates absence of a flight attendant from her home for long periods of time as contributory to an
unhappy married life. This is pure conjecture not based on actual conditions, considering that, in this modern
world, sophisticated technology has narrowed the distance from one place to another. Moreover, respondent
overlooked the fact that married flight attendants can program their lives to adapt to prevailing circumstances
and events.

Article 136 is not intended to apply only to women employed in ordinary occupations, or it should have
categorically expressed so. The sweeping intendment of the law, be it on special or ordinary occupations, is

34
reflected in the whole text and supported by Article 135 that speaks of non-discrimination on the employment of
women.

The judgment of the Court of Appeals in Gualberto, et al. vs. Marinduque Mining & Industrial Corporation
[34] considered as void a policy of the same nature. In said case, respondent, in dismissing from the service the
complainant, invoked a policy of the firm to consider female employees in the project it was undertaking as
separated the moment they get married due to lack of facilities for married women. Respondent further claimed
that complainant was employed in the project with an oral understanding that her services would be terminated
when she gets married. Branding the policy of the employer as an example of "discriminatory chauvinism
tantamount to denying equal employment opportunities to women simply on account of their sex, the appellate
court struck down said employer policy as unlawful in view of its repugnance to the Civil Code, Presidential
Decree No. 148 and the Constitution.

Under American jurisprudence, job requirements which establish employer preference or conditions relating to
the marital status of an employee are categorized as a "sex-plus" discrimination where it is imposed on one sex
and not on the other. Further, the same should be evenly applied and must not inflict adverse effects on a racial
or sexual group which is protected by federal job discrimination laws. Employment rules that forbid or restrict
the employment of married women, but do not apply to married men, have been held to violate Title VII of the
United States Civil Rights Act of 1964, the main federal statute prohibiting job discrimination against
employees and applicants on the basis of, among other things, sex. [35]

Further, it is not relevant that the rule is not directed against all women but just against married women. And,
where the employer discriminates against married women, but not against married men, the variable is sex and
the discrimination is unlawful. [36] Upon the other hand, a requirement that a woman employee must remain
unmarried could be justified as a "bona fide occupational qualification," or BFOQ, where the particular
requirements of the job would justify the same, but not on the ground of a general principle, such as the
desirability of spreading work in the workplace. A requirement of that nature would be valid provided it reflects
an inherent quality reasonably necessary for satisfactory job performance. Thus, in one case, a no-marriage rule
applicable to both male and female flight attendants, was regarded as unlawful since the restriction was not
related to the job performance of the flight attendants. [37]

5. Petitioner's policy is not only in derogation of the provisions of Article 136 of the Labor Code on the right of
a woman to be free from any kind of stipulation against marriage in connection with her employment, but it
likewise assaults good morals and public policy, tending as it does to deprive a woman of the freedom to choose
her status, a privilege that by all accounts inheres in the individual as an intangible and inalienable right. [38]
Hence, while it is true that the parties to a contract may establish any agreements, terms, and conditions that
they may deem convenient, the same should not be contrary to law, morals, good customs, public order, or
public policy. [39] Carried to its logical consequences, it may even be said that petitioner's policy against
legitimate marital bonds would encourage illicit or common-law relations and subvert the sacrament of
marriage.

Parenthetically, the Civil Code provisions on the contract of labor state that the relations between the parties,
that is, of capital and labor, are not merely contractual, impressed as they are with so much public interest that
the same should yield to the common good. [40] It goes on to intone that neither capital nor labor should visit
acts of oppression against the other, nor impair the interest or convenience of the public. [41] In the final
reckoning, the danger of just such a policy against marriage followed by petitioner PT&T is that it strikes at the
very essence, ideals and purpose of marriage as an inviolable social institution and, ultimately, of the family as
the foundation of the nation. [42] That it must be effectively interdicted here in all its indirect, disguised or
dissembled forms as discriminatory conduct derogatory of the laws of the land is not only in order but
imperatively required.

ON THE FOREGOING PREMISES, the petition of Philippine Telegraph and Telephone Company is hereby
DISMISSED for lack of merit, with double costs against petitioner. llcd

SO ORDERED.

Romero, Puno, Mendoza and Torres, Jr.,JJ ., concur.

(Philippine Telegraph and Telephone Co. v. National Labor Relations Commission, G.R. No. 118978, (23 May
1997), 338 Phil 1093-1112)

35
[G.R. No. 217414. June 22, 2022.]

CATHERINE DELA CRUZ-CAGAMPAN, petitioner, vs. ONE NETWORK BANK, INC. [ONE
NETWORK BANK]/or ALEX V. BUENAVENTURA, President/MYRNA S. VIADO, HR Head,
respondents.

DECISION
LEONEN, J p:

An employer's blanket policy of no-spouse employment is discriminatory. To justify its enforcement, the
employer must clearly establish a reasonable business necessity.

This Court resolves a Petition for Review on Certiorari [1] filed by Catherine Dela Cruz-Cagampan (Catherine)
assailing the Court of Appeals' Decision [2] and Resolution. [3] The Court of Appeals reversed the National
Labor Relations Commission's [4] affirmation of the Labor Arbiter finding that Catherine was illegally
dismissed, and thus, entitled to reinstatement and full backwages.

On June 11, 2004, One Network Bank, Inc. hired Catherine as an Accounting Specialist. [5] On May 1, 2006, it
implemented what it called an "Exogamy Policy," which stated:

Effective May 1, 2006, when two employees working for One Network Bank are subsequently married through
Church or Civil Court rites, one must terminate employment immediately after marriage.

This policy shall not affect co-employees of the bank who are already married to each other as of the end of
April 2006. [6]

On October 31, 2009, Catherine married her co-worker, Audie Angelo A. Cagampan (Audie Angelo), who
served as a Loan Specialist in One Network Bank. [7]

On November 4, 2009, the couple requested for permission from One Network Bank President Alex V.
Buenaventura (Buenaventura) to continue working for the bank, similar to that given to other couples in its
office. They expressed that Audie Angelo may be transferred to other One Network Bank branches. [8]

On November 10, 2009, the Head of Human Resources, Myrna S. Viado (Viado), denied the request and
terminated Catherine's employment. [9] AHCETa

On February 1, 2010, Catherine sought reconsideration, pointing out that the policy cannot be applied to her
case because she was employed prior to its effectivity. Further, she argued that the exogamy policy contradicts
Article 136 of the Labor Code which prohibits practices that discriminate against marriage. This remained
unheeded, prompting her to file a Complaint for illegal dismissal against One Network Bank. [10]

The Labor Arbiter rendered its October 29, 2010 Decision, [11] ruling that Catherine was illegally dismissed. It
ordered One Network Bank to reinstate Catherine and pay her money claims. The dispositive portion of the
Decision reads:

WHEREFORE, premises considered, complainant Catherine Dela Cruz-Cagampan is hereby declared illegally
dismissed. Accordingly, respondent One Network Bank, Inc. is hereby ordered (1) to immediately reinstate
complainant to her former position, without loss of seniority rights and privileges, within ten (10) calendar days
from receipt of this Decision, and to submit a report of compliance within the same period; and (2) to pay her
full backwages, inclusive of allowances, and to her other benefits or their monetary equivalent; reckoned from
the date of her dismissal on 17 February 2010 up to her actual reinstatement, the aggregate amount of which as
of the date of this Decision is tentatively computed in the amount of P100,690.85 (P12,009.00 x 8 months and
10 days).

Respondent One Network Bank, Inc. is further ordered to pay complainant her proportionate 13th month pay for
the year 2010 in the amount of P1,501.13.

The reinstatement aspect of this Decision is immediately executory, even pending appeal, pursuant to the clear
mandate of Article 223 of the Labor Code, as amended. The posting of a bond by the employer shall not stay the
execution for reinstatement as directed in this Decision. The rest of the money claims are dismissed for lack of
merit.
SO ORDERED. [12]

On appeal, the National Labor Relations Commission rendered its June 30, 2011 Decision [13] affirming the
Labor Arbiter's ruling.
36
The National Labor Relations Commission found that One Network Bank's policy was unreasonable
considering that the "mere fear of the possibility that the spouses may divulge to each other information with
respect to client's accounts is speculative, unfounded, and imaginary." [14] It ruled that One Network Bank
failed to prove the legitimate business concern in implementing the discriminatory policy against its employees.
[15]

The dispositive portion of the National Labor Relations Commission Decision reads:

WHEREFORE, the appeal is hereby ordered DISMISSED. Accordingly, the assailed Decision dated October
29, 2010 is AFFIRMED.

SO ORDERED. [16] (Emphasis in the original)

On August 24, 2011, the National Labor Relations Commission issued its Resolution [17] denying One Network
Bank's motion for reconsideration.

One Network Bank filed a Petition for Certiorari with Application for Issuance of Temporary Restraining Order
before the Court of Appeals. It argued that the National Labor Relations Commission committed grave abuse of
discretion amounting to lack or excess of jurisdiction in finding that Catherine was illegally dismissed despite
Catherine and her husband's willful violation of a policy they have known long beforehand. [18]

On May 2, 2012, the Court of Appeals denied One Network Bank's prayer for issuance of a temporary
restraining order for lack of merit. [19]

In its July 31, 2014 Decision, [20] the Court of Appeals granted One Network Bank's petition. It found that One
Network Bank's policy was a valid exercise of management prerogative. Hence, there was a just cause in
dismissing Catherine.

It explained that the bank presented a reasonable business necessity in implementing the assailed company
policy. Also known as the bona fide occupational qualification exception, this necessity originates from One
Network Bank's business that is imbued with public interest. Since One Network Bank must observe the highest
degree of diligence in handling its affairs, the policy is necessary to protect the confidential information of its
clients and minimize risks from married co-employees whose communication is privileged. [21] aICcHA

The Court of Appeals directed One Network Bank to pay Catherine separation pay and nominal damages for its
non-compliance of statutory due process. The dispositive portion of its Decision reads:

WHEREFORE, the petition is GRANTED. The Resolution dated June 30, 2011 of public respondent NLRC,
Eighth Division, Cagayan de Oro City in NLRC MAC-02-011915-2011 (RAB-X-04-00198-2010) and the
Resolution dated August 24, 2011 are REVERSED and SET ASIDE.

The employer, One Network Bank, Inc., had just cause to terminate the employment of private respondent
Catherine Dela Cruz-Cagampan and her dismissal is thus declared to be substantively valid. However,
considering that she was denied of her right to procedural due process for lack of the required notice of
dismissal, One Network Bank, Inc. is ordered to pay private respondent P30,000.00 as nominal damages for its
non-compliance with procedural due process. Private respondent Catherine Dela Cruz-Cagampan is also
awarded separation pay equivalent to one (1) month salary for every year of service based on her basic salary at
the time of her dismissal.

SO ORDERED. [22]

Catherine's Motion for Reconsideration was denied in the Court of Appeals' February 10, 2015 Resolution. [23]

Hence, Catherine filed this Petition for Review on Certiorari. [24]

In its July 13, 2015 Resolution, [25] this Court required respondents One Network Bank, Buenaventura, and
Viado to file a Comment, [26] which they later complied with. HSCATc

Petitioner argues that the Court of Appeals erred in resolving the petition for certiorari before it, despite being
filed out of time. [27] She avers that it was mistaken in concluding that the assailed exogamy policy was a valid
exercise of management prerogative. [28] She claims that the two requisites for a bona fide occupational
qualification enunciated in Star Paper Corp. v. Simbol [29] are absent here. [30] She asserts that respondent
One Network Bank "has the burden to prove the existence of a reasonable business necessity, being [her]
employer," [31] to justify the policy. This, it failed to do, as the Labor Arbiter and the National Labor Relations
Commission found.

37
Petitioner also alleges that there were other employees who married coworkers after the policy's implementation
but were retained by respondents. According to petitioner, this showed respondents' "double standards" and
discrimination. [32]

In their Comment, respondents counter that petitioner is misleading this Court on the material dates. They
contend that their petition for certiorari before the Court of Appeals was timely filed. On the other assertions,
respondent simply claimed that they are "baseless and are mere desperate display of [petitioner's] self-serving
conclusions of fact and law. Petitioner's arguments and (sic) are indubitably rehashed and do not deserve any
repetitive counter-argument." [33]

For this Court's resolution is the issue of whether or not the Court of Appeals erred in reversing the National
Labor Relations Commission's Decision, which affirmed the Labor Arbiter's finding that petitioner Catherine
Dela Cruz-Cagampan was illegally dismissed. Subsumed in this is whether or not respondent One Network
Bank, Inc.'s prohibition on retaining employees who marry a co-worker is lawful.

This Court grants the Petition and reverses the assailed Court of Appeals judgment. Petitioner Catherine Dela
Cruz-Cagampan was illegally dismissed and must be reinstated.

I
Generally, a petition under Rule 45 of the Rules of Court cannot entertain factual issues requiring a
reassessment of the evidence on record. [34] This rule admits of exceptions, one of which is when the findings
of the lower tribunals are contradictory. [35]

In labor cases, a petition for review on certiorari "can prosper only if the Court of Appeals . . . fails to correctly
determine whether the National Labor Relations Commission committed grave abuse of discretion." [36]

Manggagawa ng Komunikasyon sa Pilipinas v. Philippine Long Distance Telephone Co., Inc. [37] explained
when a tribunal acts in grave abuse of discretion and the parameters of judicial review of labor cases:

A court or tribunal is said to have acted with grave abuse of discretion when it capriciously acts or whimsically
exercises judgment to be "equivalent to lack of jurisdiction." Furthermore, the abuse of discretion must be so
flagrant to amount to a refusal to perform a duty or to act as provided by law.

Career Philippines Shipmanagement, Inc. v. Serna, citing Montoya v. Transmed, provides the parameters of
judicial review for a labor case under Rule 45:

As a rule, only questions of law may be raised in a Rule 45 petition. In one case, we discussed the particular
parameters of a Rule 45 appeal from the CA's Rule 65 decision on a labor case, as follows:

In a Rule 45 review, we consider the correctness of the assailed CA decision, in contrast with the review for
jurisdictional error that we undertake under Rule 65. Furthermore, Rule 45 limits us to the review of questions
of law raised against the assailed CA decision. In ruling for legal correctness, we have to view the CA decision
in the same context that the petition for certiorari it ruled upon was presented to it; we have to examine the CA
decision from the prism of whether it correctly determined the presence or absence of grave abuse of discretion
in the NLRC decision before it, not on the basis of whether the NLRC decision on the merits of the case was
correct. In other words, we have to be keenly aware that the CA undertook a Rule 65 review, not a review on
appeal, of the NLRC decision challenged before it.

Justice Arturo D. Brion's dissent in Abbott Laboratories, Philippines v. Alcaraz thereafter laid down the
guidelines to be followed in reviewing a petition for review under Rule 45:

If the NLRC ruling has basis in the evidence and the applicable law and jurisprudence, then no grave abuse of
discretion exists and the CA should so declare and, accordingly, dismiss the petition. If grave abuse of discretion
exists, then the CA must grant the petition and nullify the NLRC ruling, entering at the same time the ruling that
is justified under the evidence and the governing law, rules and jurisprudence. In our Rule 45 review, this Court
must deny the petition if it finds that the CA correctly acted. [38] (Emphasis in the original, citations omitted)

Under Rule 65 of the Rules of Court, the special civil action of certiorari may strike down the act of a court or
tribunal upon a finding that it was manifestly whimsical in its exercise of discretion. TAacHE

Thus, in this Rule 45 Petition, the inquiry before this Court is whether or not the Court of Appeals correctly
acted on the petition for certiorari before it, when it found that the National Labor Relations Commission was
in grave abuse of discretion in ruling in petitioner's favor.

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II
The Court of Appeals reversed the National Labor Relations Commission's affirmation of the Labor Arbiter's
pronouncement that petitioner was illegally dismissed and respondents' "exogamy policy" was unreasonable.

The Court of Appeals is mistaken. The National Labor Relations Commission's ruling was proper and not in
grave abuse of discretion.

The Constitution mandates the State to "afford full protection to labor . . . and promote full employment and
equality of employment opportunities for all." [39] It guarantees the right of all workers to security of tenure.

Under the Magna Carta of Women, the State commits to eliminate discrimination against women and ensures
their right to freely choose a spouse. [40] Particularly, Article 134 [136] of the Labor Code [41] prohibits
employers from discriminating women employees:

ARTICLE 134. Stipulation against marriage. — It shall be unlawful for an employer to require as a condition of
employment or continuation of employment that a woman employee shall not get married, or to stipulate
expressly or tacitly that upon getting married, a woman employee shall be deemed resigned or separated, or to
actually dismiss, discharge, discriminate or otherwise prejudice a woman employee merely by reason of her
marriage. (Emphasis supplied)

Respondents implemented a policy stating that "when two employees working for One Network Bank are
subsequently married through Church or Civil Court rites, one must terminate employment immediately after
marriage." [42] They then terminated petitioner's employment for her violation of the company policy.
Interestingly, her husband's employment was retained.

Apart from the couple's supposed transgression when they married, respondents did not state any other reason
why they dismissed petitioner. Further, respondents consistently argued that the couple willingly violated the
company policy despite their knowledge of it. While respondents maintain that petitioner and her husband both
knowingly transgressed the rule, nothing in the records show why respondents dismissed petitioner in particular.
To stress, they opted to terminate petitioner's employment sans any reason why she must leave, in lieu of her
husband. An employer's dismissal of a female employee solely because of her marriage is precisely the
discrimination that the Labor Code expressly prohibits. This Court cannot countenance respondents' unlawful
act.

III
The National Labor Relations Commission and the Labor Arbiter found respondent One Network Bank's policy
unreasonable, while the Court of Appeals excused it as management prerogative. The Court of Appeals found
that respondent bank had reasonable business necessity in implementing the policy, and it is a bona fide
occupational qualification exception.

Indeed, employers may freely conduct their affairs and employ discretion and judgment in managing all aspects
of employment. [43] However, their exercise of this right to management prerogative must be in accord with
justice and fair play. [44]

Philippine Airlines, Inc. v. Dawal [45] explained that an employer's management prerogative may not be
premised on unlawful causes nor excuse unlawful acts:

[Philippine Airlines'] claim of management prerogative does not automatically absolve it of liability.
Management prerogative is not unbridled and limitless. Nor is it beyond this court's scrutiny. Where abusive and
oppressive, the alleged business decision must be tempered to safeguard the constitutional guarantee of
providing "full protection to labor." Management prerogative cannot justify violation of law or the pursuit of
any arbitrary or malicious motive. [46] (Emphasis supplied, citations omitted)

In determining whether an employer's policy prohibiting spouses from working in the same company or a "no-
spouse employment policy" is unlawful, Star Paper Corp. v. Simbol [47] discussed the bona fide occupational
qualification that may possibly justify it:

The courts that have broadly construed the term "marital status" rule that it encompassed the identity,
occupation and employment of one's spouse. They strike down the no-spouse employment policies based on the
broad legislative intent of the state statute. They reason that the no-spouse employment policy violate the
marital status provision because it arbitrarily discriminates against all spouses of present employees without
regard to the actual effect on the individual's qualifications or work performance. These courts also find the no-
spouse employment policy invalid for failure of the employer to present any evidence of business necessity
39
other than the general perception that spouses in the same workplace might adversely affect the business. They
hold that the absence of such a bona fide occupational qualification invalidates a rule denying employment to
one spouse due to the current employment of the other spouse in the same office. Thus, they rule that unless the
employer can prove that the reasonable demands of the business require a distinction based on marital status
and there is no better available or acceptable policy which would better accomplish the business purpose, an
employer may not discriminate against an employee based on the identity of the employee's spouse. This is
known as the bona fide occupational qualification exception.

We note that since the finding of a bona fide occupational qualification justifies an employer's no-spouse rule,
the exception is interpreted strictly and narrowly by these state courts. There must be a compelling business
necessity for which no alternative exists other than the discriminatory practice. To justify a bona fide
occupational qualification, the employer must prove two factors: (1) that the employment qualification is
reasonably related to the essential operation of the job involved; and, (2) that there is a factual basis for
believing that all or substantially all persons meeting the qualification would be unable to properly perform the
duties of the job. [48] (Emphasis in the original, Citations omitted)

Thus, a bona fide occupational qualification requires the concurrence of two elements: "(1) that the employment
qualification is reasonably related to the essential operation of the job involved; and, (2) that there is a factual
basis for believing that all or substantially all persons meeting the qualification would be unable to properly
perform the duties of the job." [49]

Star Paper Corp. continued that in this jurisdiction, the standard of reasonableness is employed in determining
whether an otherwise discriminatory practice may be excused:

The concept of a bona fide occupational qualification is not foreign in our jurisdiction. We employ the standard
of reasonableness of the company policy which is parallel to the bona fide occupational qualification
requirement. In the recent case of Duncan Association of Detailman-PTGWO and Pedro Tecson v. Glaxo
Welcome Philippines, Inc., we passed on the validity of the policy of a pharmaceutical company prohibiting its
employees from marrying employees of any competitor company. We held that Glaxo has a right to guard its
trade secrets, manufacturing formulas, marketing strategies and other confidential programs and information
from competitors. We considered the prohibition against personal or marital relationships with employees of
competitor companies upon Glaxo's employees reasonable under the circumstances because relationships of
that nature might compromise the interests of Glaxo. In laying down the assailed company policy, we
recognized that Glaxo only aims to protect its interests against the possibility that a competitor company will
gain access to its secrets and procedures.

The requirement that a company policy must be reasonable under the circumstances to qualify as a valid
exercise of management prerogative was also at issue in the 1997 case of Philippine Telegraph and Telephone
Company v. NLRC. In said case, the employee was dismissed in violation of petitioner's policy of disqualifying
from work any woman worker who contracts marriage. We held that the company policy violates the right
against discrimination afforded all women workers under Article 136 of the Labor Code, but established a
permissible exception, viz.:

[A] requirement that a woman employee must remain unmarried could be justified as a "bona fide occupational
qualification," or BFOQ, where the particular requirements of the job would justify the same, but not on the
ground of a general principle, such as the desirability of spreading work in the workplace. A requirement of that
nature would be valid provided it reflects an inherent quality reasonably necessary for satisfactory job
performance[.]

The cases of Duncan and PT&T instruct us that the requirement of reasonableness must be clearly established
to uphold the questioned employment policy. The employer has the burden to prove the existence of a
reasonable business necessity. The burden was successfully discharged in Duncan but not in PT&T. [50]
(Emphasis in the original, citations omitted)

Substantial evidence is the quantum of proof required in labor cases. It is "such relevant evidence as a
reasonable mind might accept as adequate to support a conclusion." [51] To justify their otherwise
discriminatory policy, respondents have the burden to establish by substantial evidence the reasonable necessity
for it. They must show that no other alternative to the policy exists.

Weighed against the constitutionally mandated full protection to labor and the various statutory protections
accorded to the sector, this Court finds that respondents failed to demonstrate the reasonable business necessity
for its no-spouse employment policy.

40
First, the no-spouse qualification is not reasonably related to the bank's essential operation of its business. It
unduly discourages all employees from marrying a fellow worker at the pain of termination. We adopt the
National Labor Relations Commission's findings:

The mere fear of the possibility that the spouses may divulge to each other information with respect to client's
accounts is speculative, unfounded and imaginary. Respondent [One Network Bank] failed to specifically
demonstrate and lay bare in what manner and instances would the climate of trust and security of its clients
would be affected by complainant's marriage to her co-employee. If such is its primary concern, it could only
formulate a company policy on confidentiality in the performance of one's duty, which may mele a graver
penalty of dismissal in case of breach. Such policy is more concrete, tangible and real and not based on mere
conjecture, unproven presumption of perceived fear of ruining the bank's integrity at the expense of
complainant's right to security of tenure. The fear entertained by respondent [One Network Bank] was never
translated into crystal clear circumstance or scenario which would convince us and see the light on the wisdom
of the said policy. Mere generalities cannot defeat complainant's protection against illegal termination. [52]
EDCcaS

The National Labor Relations Commission's disposition was based on Star Paper Corp., the prevailing
jurisprudence. We find that there is no iota of proof that supports respondents' assertion that petitioner's
marriage to her fellow employee places the bank's funds at risk for embezzlement. The reasonable relation
between a discriminatory policy and the employer's industry that shall excuse its implementation must be based
on facts, not mere surmises. We agree that respondents' fear is more imagined than real.

The Court of Appeals erred in heavily relying on the higher standards of diligence required of banks to allow
their immediate resort to an employee's dismissal in case of marriage to a co-worker. As petitioner pointed out,
respondents may transfer either of them to a different branch, or reassign them in a different role, among others,
to minimize the alleged risk that a married loan specialist and account specialist expose them to. Respondents
may likewise implement stronger confidentiality measures that do not impinge on employees' right to security
of tenure.

Second, there is no factual basis to conclude that all of their employees who marry each other would be unable
to perform their duties, entailing one's dismissal. The policy was couched in a general manner, that whenever
any two of their employees marry, one must terminate employment immediately after marriage. [53] There is a
host of employees in a bank that have varying functions, duties, and responsibilities. The general articulation
allows respondents to whimsically enforce its policy, as petitioner alleged here that others had been spared.
Further, it leaves them the option on which employee's services to terminate. Here, they arbitrarily dismissed
petitioner. The basic tenets of due process cannot allow this.

Contrary to the Court of Appeals' Decision, we find that respondents' no-spouse employment policy cannot
justify petitioner's dismissal. The National Labor Relations Commission did not gravely abuse its discretion, as
nothing was whimsical, capricious, or arbitrary in finding that petitioner was illegally dismissed. A reasonable
business necessity must be clearly shown to excuse a discriminatory exercise of management prerogative.

Thus, this Court is compelled to reinstate the Labor Arbiter's ruling, which the National Labor Relations
Commission affirmed. Under the Labor Code, an illegally dismissed employee is entitled to reinstatement, with
payment of backwages from dismissal:

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. An employee who is
unjustly dismissed from work shall be entitled to reinstatement without loss of seniority rights and other
privileges and to his [or her] full backwages, inclusive of allowances, and to his [or her] other benefits or their
monetary equivalent computed from the time his [or her] compensation was withheld from him [or her] up to
the time of his [or her] actual reinstatement. [54] (Emphasis supplied0029

The prayer for moral and exemplary damages is denied for lack of factual basis. However, for having been
forced to litigate to protect her rights, petitioner is awarded attorney's fees, which is 10% of the total monetary
award. [55] Additionally, legal interest shall be 6% per annum from the date of promulgation of this judgment
until fully paid. [56]

Friends, lovers, and couples share secrets. Any bank employee may potentially craft elaborate schemes to
embezzle the bank's funds. While a bank must observe high standards of diligence, enforcing an arbitrary no-
spouse employment rule that directs the immediate dismissal of an employee who marries a co-worker cannot
be justified. That is illegal dismissal.

41
WHEREFORE, the Petition for Review on Certiorari is GRANTED. The Court of Appeals' July 31, 2014
Decision and February 10, 2015 Resolution in CA-G.R. SP No. 04589-MIN are REVERSED and SET ASIDE.

The Labor Arbiter's October 29, 2010 Decision in NLRC MAC-02-011915-2011 (RAB-X-04-00198-2010) is
REINSTATED with MODIFICATION.

Respondent One Network Bank, Inc. is ordered to reinstate petitioner Catherine Dela Cruz-Cagampan to her
former position, and to pay her backwages, including P1,501.13, her proportionate 13th month pay for 2010,
allowances, and other benefits or their monetary equivalent from the time she was illegally dismissed on
February 17, 2010, up to her actual reinstatement. She is also entitled to attorney's fees of 10% of the total
monetary award, subject to legal interest at the rate of 6% per annum from finality of this Decision until full
payment. DHESca

SO ORDERED.

Lazaro-Javier, M.V. Lopez, J.Y. Lopez and Kho, Jr., JJ., concur.

(Dela Cruz-Cagampan v. One Network Bank, Inc., G.R. No. 217414, (22 June 2022))

42