Philippine Commercial International Bank vs. Anastacio D. Abad

G.R. No. 158045

February 28, 2005

FACTS: 

Anastacio D. Abad was the senior Assistant Manager (Sales Head) of petitioner Philippine Commercial International Bank (PCI Bank now Equitable PCI Bank)], when he was dismissed from his work. Abad received a Memorandum from petitioner Bank concerning the irregular clearing of PNB-Naval Check of Sixtu Chu, the Bank’s valued client. Abad submitted his Answer, categorically denying that he instructed his subordinates to validate the out-of-town checks of Sixtu Chu presented for deposit or encashment as local clearing checks. During the actual investigation conducted by petitioner Bank, several transactions violative of the Bank’s Policies and Rules and Regulations were uncovered by the Fact-Finding Committee. Consequently, the Fact-Finding Officer of petitioner Bank issued another Memorandum to Abad asking the latter to explain the newly discovered irregularities. Not satisfied with the explanations of Abad, petitioner Bank served another Memorandum, terminating his employment effective immediately upon receipt of the same. Thus, Abad instituted a Complaint for Illegal Dismissal.

ISSUE: 

Whether or not awarding of separation pay equivalent to one-half (1/2) month’s pay for every year of service to respondent is gross, the same being contrary to law and jurisprudence.

HELD:

The award of separation pay is required for dismissals due to causes specified under Articles 283 and 284 of the Labor Code, as well as for illegal dismissals in which reinstatement is no longer feasible. On the other hand, an employee dismissed for any of the just causes enumerated under Article 282 of the Labor Code is not, as a rule, entitled to separation pay.

As an exception, allowing the grant of separation pay or some other financial assistance to an employee dismissed for just causes is based on equity. The Court has granted separation pay as a measure of social justice even when an employee has been validly dismissed, as long as the dismissal was not due to serious misconduct or reflective of personal integrity or morality.