Abbot Laboratories v. Alcaraz

G.R. No. 192571               July 23, 2013

FACTS:

Abbott caused the publication in a major broadsheet newspaper of its need for a Regulatory Affairs Manager, indicating therein the job description for as well as the duties and responsibilities attendant to the aforesaid position. Alcaraz signed an employment contract which specifically stated, inter alia, that she was to be placed on probation for a period of six (6) months beginning February 15, 2005 to August 14, 2005. On the day Alcaraz accepted Abbott’s employment offer, Bernardo sent her copies of Abbott’s organizational structure and her job description through e-mail. She also had undergone a pre-employment orientation and training program as part of her orientation.

In May , Alcaraz was informed and asked to tender her resignation or they be forced to terminate her services because she failed to meet the regularization standards. She then filed a complaint for illegal dismissal and damages against Abbott and its officers.

She claimed that she should have already been considered as a regular and not a probationary employee given Abbott’s failure to inform her of the reasonable standards for her regularization upon her engagement as required under Article 295 of the Labor Code.

The LA dismissed Alcaraz’s complaint for lack of merit because she  was unable to meet the standards set by Abbott as per her performance evaluation, the termination of her probationary employment was justified. The NLRC reversed the findings of the LA and ruled that there was no evidence showing that Alcaraz had been apprised of her probationary status and the requirements which she should have complied with in order to be a regular employee. The CA affirmed the ruling of the NLRC .

ISSUES:

1. whether or not Alcaraz was sufficiently informed of the reasonable standards to qualify her as a regular employee;

2. whether or not Alcaraz was validly terminated from her employment;

HELD:

1. YES. Alcaraz was well-aware that her regularization would depend on her ability and capacity to fulfill the requirements of her position as Regulatory Affairs Manager and that her failure to perform such would give Abbott a valid cause to terminate her probationary employment.

A probationary employee, like a regular employee, enjoys security of tenure. However, in cases of probationary employment, aside from just or authorized causes of termination, an additional ground is provided under Article 295 of the Labor Code, i.e., the probationary employee may also be terminated for failure to qualify as a regular employee in accordance with the reasonable standards made known by the employer to the employee at the time of the engagement.

(b) YES.  Despite the existence of a sufficient ground to terminate Alcaraz’s employment and Abbott’s compliance with the Labor Code termination procedure, it is readily apparent that Abbott breached its contractual obligation to Alcaraz when it failed to abide by its own procedure in evaluating the performance of a probationary employee thus, warrants for the payment of nominal damages.

A company policy partakes of the nature of an implied contract between the employer and employee. Hence, given such nature, company personnel policies create an obligation on the part of both the employee and the employer to abide by the same.

Records show that Abbott’s PPSE procedure mandates, inter alia, that the job performance of a probationary employee should be formally reviewed and discussed with the employee at least twice; Abbott is also required to come up with a Performance Improvement Plan during the third month review to bridge the gap between the employee’s performance and the standards set, if any. In addition, a signed copy of the PPSE form should be submitted to Abbott’s HRD as the same would serve as basis for recommending the confirmation or termination of the probationary employment.

Abbott failed to follow the above-stated procedure in evaluating Alcaraz. Case law has settled that an employer who terminates an employee for a valid cause but does so through invalid procedure is liable to pay the latter nominal damages.

The contract is the law between the parties and thus, breaches of the same impel recompense to vindicate a right that has been violated. Consequently, while the Court is wont to uphold the dismissal of Alcaraz because a valid cause exists, the payment of nominal damages on account of Abbott’s contractual breach is warranted in accordance with Article 2221 of the Civil Code.

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