Is it Really Easy to Terminate Managerial Employees?
It has been a common impression that managerial employees are easy to terminate. The cause of this view is the concept of loss of trust and confidence or willful breach of trust under Article 297 of the Labor Code, as amended.
While an employer has its own interest to protect, and pursuant thereto, it may terminate a managerial employee for a just cause, such prerogative to dismiss or lay off an employee must be exercised without abuse of discretion. Its implementation should be tempered with compassion and understanding.
As held by the Supreme Court:
“The employer should bear in mind that, in the execution of the said prerogative, what is at stake is not only the employee’s position, but his very livelihood, his very breadbasket. Indeed, the consistent rule is that if doubts exist between the evidence presented by the employer and the employee, the scales of justice must be tilted in favor of the latter. The employer must affirmatively show rationally adequate evidence that the dismissal was for justifiable cause. Thus, when the breach of trust or loss of confidence alleged is not borne by clearly established facts, as in this case, such dismissal on the cited grounds cannot be allowed.”
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The Supreme Court had already reproached this kind of arbitrary dismissal of a managerial employee, in this wise:
“Herein, the respondents could not simply dismiss the petitioner on account of her position. Although a less stringent degree of proof was required in termination cases involving managerial employees, the employers could not invoke the ground of loss of trust and confidence arbitrarily. There must still be some basis to justify that the petitioner was somehow responsible for the loss of the equipment, and to show that her participation in the loss rendered her unworthy of the trust and confidence demanded of her position as the Nurse Supervisor. As already discussed, however, she could not be made accountable for the missing property for several reasons. Firstly, she was not vested with the responsibility of safekeeping of the hospital equipment and machines. And, secondly, the respondents did not adduce evidence showing that she had committed wilful and deliberate acts that led to the loss. As such, her dismissal based on loss of trust and confidence should not be upheld.”
Labor law instructs that employers should establish the existence of an act justifying their alleged loss of
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trust and confidence. Otherwise, the dismissal is illegal. Thus:
“It is true that respondent may indeed be considered as one who occupies a position of trust and confidence as he is one of those who were entrusted with the handling of a significant amount or portion of petitioners’ products for sale. However, even a quick perusal of the records at hand would show that petitioners failed to present substantial evidence to support their allegations that respondent had, in any way, participated in the theft of the company’s stolen items and that after his preventive suspension he no longer reported for work. In other words, petitioners were not able to establish the existence of an act justifying their alleged loss of trust and confidence in respondent.”
The misdeed attributed to the employee must be a genuine and serious breach of established expectations required by the exigencies of the position regardless of its designation, and not out of a mere distaste, apathy, or petty misunderstanding. It cannot be overemphasized that the employee’s reputation and good name are currency in their chosen profession, and their livelihood, at the very least, is what is at stake. Employment and tenure cannot be bargained away for the convenience of attaching
blame and holding one accountable when no such accountability exists.
As a final note, if there is substantial evidence to terminate a managerial employee based on actual and verifiable circumstance, then it is easy to terminate on that respect.
However, in the absence of such standard, the managerial employee cannot just be terminated based on empty assertion of loss of trust and nebulous facts.
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