VOL.

217, JANUARY 19, 1993 237

Imperial Textile Mills, Inc. vs. NLRC

21

IMPERIAL TEXTILE MILLS, INC., petitioner, vs.

NATIONAL LABOR RELATIONS COMMISSION, Third
Division, and ANGIE MENDOZA, respondents.

Labor Law; Constitutional Law; Due Process; It is not the

denial of the right to be heard but the deprivation of the
opportunity to be heard which constitutes a violation of the due
process clause.—It is a basic rule that it is not the denial of the
right to be heard but the deprivation of the opportunity to be
heard which constitutes a violation of the due process clause. As
held in Var-Orient Shipping Co., Inc., et al. vs. Achacoso, etc., et
al., and subsequently reiterated in Bautista, et al. vs. Secretary of
Labor and Employment, et al.: “Equally unmeritorious is
petitioners’ allegation that they were denied due process because
the decision was rendered without a formal hearing. The essence
of due process is simply an opportunity to be heard, or, as applied
to administrative proceedings, an opportunity to explain one’s
side, or an opportunity to seek a reconsideration of the action or
ruling complained of.”

_______________

* SECOND DIVISION.

238

238 SUPREME COURT REPORTS ANNOTATED

Imperial Textile Mills, Inc. vs. NLRC

Same; Remedial Law; Well-settled, is the rule that procedural

technicalities do not strictly apply to proceedings before labor
arbiters for they may avail themselves of all reasonable means to
speedily ascertain the facts of a controversy.—Well-settled, is the
rule that procedural technicalities do not strictly apply to
proceedings before labor arbiters for they may avail themselves of
all reasonable means to speedily ascertain the facts of a
controversy.

Same; Dismissal; Although loss of confidence is a valid cause

to terminate an employee, it must nonetheless rest on an actual
breach of duty committed by the employee and not on the
employer’s caprices.—Although loss of confidence is a valid cause
to terminate an employee, it must nonetheless rest on an actual
breach of duty committed by the employee and not on the
employer’s caprices. The burden of proof rests upon the employer
to establish that the dismissal is for cause in view of the security
of tenure that employees enjoy under the Constitution and the
Labor Code. The failure of the employer to do so would mean that
the dismissal is not justified.

Same; Same; Same; The employer’s evidence must clearly and

convincingly establish the facts upon which the loss of confidence
in the employee may fairly be made to rest.—It is likewise
essential that there be substantial evidence to support a charge of
loss of confidence. The employer’s evidence must clearly and
convincingly establish the facts upon which the loss of confidence
in the employee may fairly be made to rest.

Same; Same; Same; Same; Requisites to constitute a valid

dismissal.—In addition, we have ruled that to constitute a valid
dismissal, two requisites must concur: (1) the dismissal must be
for any of the causes provided for under Article 282 of the Labor
Code, and (2) only after the employee has been notified in writing
and given the opportunity to be heard and defend himself as
required under Sections 2 and 5, Rule XIV, Book V of the
Implementing Rules.

Same; Same; Appeal; The general rule is that the perfection of

an appeal in the manner and within the period prescribed by law
is not only mandatory but jurisdictional.—It appears that the
appeal with respondent commission was indeed filed late. The
general rule is that the perfection of an appeal in the manner and
within the period prescribed by law is not only mandatory but
jurisdictional. Failure to conform to the rules will render the
judgment sought to be reviewed final and unappealable.

239

VOL. 217, JANUARY 19, 1993 239

Imperial Textile Mills, Inc. vs. NLRC

Same; Same; Benefits; The award of separation pay is in lieu

of reinstatement and not of backwages.—Backwages and
reinstatement are two reliefs given to an illegally dismissed
employee. They are separate and distinct from each other.
However, in the event that reinstatement is no longer possible,
separation pay is awarded to the employee. Thus, the award of
separation pay is in lieu of reinstatement and not of backwages.
In other words, an illegally dismissed employee is entitled to (1)
either reinstatement, if viable, or separation pay if reinstatement
is no longer viable and (2) backwages.”

Same; Same; Same; Same; Where the ground of loss of

confidence has neither been established nor sufficient basis thereof
presented, the finding that respondent employee was illegally
dismissed was well taken and said employee, although not
reinstated, was awarded three years backwages.—The payment of
backwages is one of the reliefs which an illegally dismissed
employee prays the labor arbiter and the National Labor
Relations Commission to render in his favor as a consequence of
the unlawful act committed by the employer. The award thereof is
not private compensation or damages but is in furtherance and
effectuation of the public objectives of the Labor Code. Even
though the practical effect is the enrichment of the individual, the
award of backwages is not in redress of a private right, but,
rather, is in the nature of a command upon the employer to make
public reparation for his violation of the Labor Code, such as the
dismissal of an employee due to the unlawful act of the employer
or the latter’s bad faith. Hence, we have ruled that where the
ground of loss of confidence has neither been established nor
sufficient basis thereof presented, the finding that respondent
employee was illegally dismissed was well taken and said
employee, although not reinstated, was awarded three years
backwages.

Same; Same; Same; Same; Where the decision ordering the

reinstatement of the employee may no longer be enforced or is no
longer feasible because of the strained relations between the
parties, the employee may be awarded separation pay as an
alternative to reinstatement.—With respect to the award of
separation pay, we declared in Santos vs. National Labor
Relations Commission, et. al., that where the decision ordering
the reinstatement of the employee may no longer be enforced, or
is no longer feasible because of the strained relations between the
parties, the employee may be awarded separation pay as an
alternative to reinstatement. Such a situation obtains in this case
and considering further the confidential nature of private
respondent’s position, we find no reason why the foregoing
doctrine should not here apply.

240

240 SUPREME COURT REPORTS ANNOTATED

Imperial Textile Mills, Inc. vs. NLRC

PETITION for certiorari to review the decision of the

National Labor Relations Commission.

The facts are stated in the opinion of the Court.

          Batino Angala Salud & Fabia Law Office for
petitioner.
     Magtanggol C. Gunigundo for respondent.
     People’s Law Office for private respondent.

REGALADO, J.:

This1 original petition for certiorari seeks to annul the deci-

sion of the National Labor Relations Commission
(hereafter, respondent commission), dated June 28, 1991,
finding that herein private respondent Angie Mendoza was
illegally dismissed and awarding her three years
backwages and separation pay.
We quote the undisputed facts as found by respondent
commission:

“Appellant Angie Mendoza had been employed with appellee since

1977. She rose from the ranks from the position of secretary to the
Finishing Department Head to secretary to the Executive Vice
President, and later to personnel manager up to March 7, 1986.
Her latest salary was P6,190.00. In the latter part of 1986, a new
management group took over appellee. Appellant, who was on
leave, found out about the changes and consequently wrote the
widow of the former president of appellee, to wit:
xxx

‘Dear Mrs. Salazar:

‘In compliance with my verbal promise and in
abiding by the company rules and regulations, the
undersigned reported to your goodself on March 7, the
expiration of an approved one month vacation leave.
‘It is sad to know that during my absence, major
changes took place in ITM. There was a take-over of
new management, appointment and reorganization of
new officers and other key
_______________

1 Annex A, Petition; Rollo, 19.

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VOL. 217, JANUARY 19, 1993 241

Imperial Textile Mills, Inc. vs. NLRC

positions have been effected. Needless to say, the

position of the undersigned as Personnel Manager was
also filled up by a newcomer.
‘In view of the above circumstances, I deem it proper
and wise to cease my employment, but with equivalent
separation pay from the company. I am happy to
announce that I am one of the pioneer employees,
having employed (sic) in 1971 as secretary to then
Finishing Dept. Head. Being an experienced and
competent secretary, after two months I rose to the
position of secretary to the Exec. Vice President. In
January 1975, I was appointed to succeed and execute
the duties and responsibilities of the resigned
Personnel Manager and at same time as secretary to
the executives of the company. During the period June
1984 to June 1985, I was appointed in the concurrent
capacity as Personnel Manager of Grand Alliance
Mills, sister company of ITM.
‘For fifteen years of stay, I could proudly say that I
dedicated one-third of my life in serving the company
honestly and efficiently, my employment records can
fully vouch for that.
‘I sincerely hope that you will merit this request
with your usual kind consideration and immediate
attention.’
Respectfully yours,     
Angie S. Mendoza”     

“On June 6, 1986, the instant complaint for illegal dismissal was
filed. Complainant alleged that she was dismissed without
sufficient grounds after 14 years of service.
“In its defense, respondent averred that complainant
voluntarily resigned and if she was terminated such termination
was due to valid and just grounds. Being a managerial 2employee
she could be terminated for loss of trust and confidence.”

Thereafter, the parties submitted their respective3 position

papers. Petitioner then filed a motion to dismiss alleging
that: (1) private respondent’s position paper is unverified
and should be stricken off the record; and (2) complainant
failed to appear despite notice, thereby depriving
4
petitioner
of its right to cross-examine her. In an order dated May 25,
1988, the labor arbiter

_____________

2 Rollo, 20, 22.

3 Annex D, id.; ibid., 68.
4 Annex D-2, id.; ibid., 76.

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242 SUPREME COURT REPORTS ANNOTATED

Imperial Textile Mills, Inc. vs. NLRC

dismissed the complaint without prejudice, on the ground

that complainant’s absence deprived herein petitioner of
the opportunity to cross-examine her.
On appeal, respondent
5
commission reversed the labor
arbiter in a decision dated October 28, 1988, holding that
under Article 221 of the Labor Code, respondent
commission and the labor arbiter have the authority to
decide cases based on position papers and documents
submitted by the parties without resorting to technical
rules of evidence; and that herein petitioner was not denied
due process because on the basis of the records of the case,
an intelligent decision could be arrived at without resorting
to a formal hearing. Petitioner went to this Court on a
petition for certiorari, entitled “Imperial Textile Mills, Inc.
vs. National Labor Relations, et. al.,” docketed as G.R. No.6
86663, which was however dismissed in our resolution of
February 15, 1989.
The case was thereafter remanded 7to the labor arbiter
who subsequently rendered a decision on April 10, 1990
declaring the dismissal of complainant as legally effected
on the ground that she resigned voluntarily and that her
dismissal was for a valid cause, that is, loss of trust and
confidence. On appeal, respondent commission rendered its
questioned decision reversing the findings of the labor
arbiter and holding that herein private respondent was
illegally dismissed, thus:

“Was appellant illegally dismissed? We believe so. The letter

dated March 31, 1986 clearly stated that she was asking for
separation pay because she found out that she had already been
replaced during her leave of absence. x x x Appellant’s resignation
and request for separation pay was prompted solely by her
removal as indicated in her letter. In short, complainant was
forced to resign.
“If it was loss of confidence that prompted appellee to remove
appellant, appellee had the burden of proving it. Appellee had not
adduced an iota of evidence that would account for the alleged
‘loss of confidence.’
“Considering, however, that complainant appears to have
sought

_________________

5 Annex E-1, id.; ibid., 86.

6 Rollo, 8.
7 Annex A-2, id.; ibid., 40.

243

VOL. 217, JANUARY 19, 1993 243

Imperial Textile Mills, Inc. vs. NLRC

employment elsewhere in lieu of reinstatement, an award of

separation pay and three years backwages,8 consistent with the
rulings of the Supreme Court, is but proper.”

Petitioner’s9 motion for reconsideration was denied in a

reso-lution dated August 16, 1991, hence the instant
petition.

1. Petitioner inceptively asserts that it was denied due

process when it was not given the opportunity to
cross-examine herein private respondent during the
hearing before the labor arbiter.

It is a basic rule that it is not the denial of the right to be

heard but the deprivation of the opportunity to be heard
which constitutes a violation of the due process clause. As
held in Var-Orient
10
Shipping Co., Inc., et al. vs. Achacoso,
etc., et al., and subsequently reiterated in Bautista,
11
et al.
vs. Secretary of Labor and Employment, et al.: “Equally
unmeritorious is petitioners’ allegation that they were
denied due process because the decision was rendered
without a formal hearing. The essence of due process is
simply an opportunity to be heard, or, as applied to
administrative proceedings, an opportunity to explain one’s
side, or an opportunity to seek a reconsideration of the
action or ruling complained of.”
There was sufficient compliance with the requirement of
due process as petitioner was given the opportunity to
present its case through a motion to dismiss and a position
paper filed with the labor arbiter.

2. It is contended that while the decisions of

respondent commission may be rendered based on
position papers, such rule is not applicable to the
case at bar where the position paper submitted by
the private respondent is not verified. The
contention is without merit.

First, the issue on the admissibility of the unverified

position paper has been passed upon by this Court in its
disposition of the aforementioned petition in G.R. No.
86663 which upheld

______________

8 Rollo, 23-24.
9 Annex B, id.; ibid., 51.
10 161 SCRA 732 (1988).
11 196 SCRA 470 (1991).

244

244 SUPREME COURT REPORTS ANNOTATED

Imperial Textile Mills, Inc. vs. NLRC

the decision of respondent commission, reversing the order

of dismissal of the labor arbiter on the ground that the case
could be resolved on the basis of the position papers
submitted by the parties. In effect, it was there held by
necessary implication that the unverified position paper
submitted by herein private respondent is deemed
sufficient. Besides, even the labor arbiter in his order dated
May 25, 1988 admits that the unverified position paper is a
mere procedural
12
infirmity which does not affect the merits
of the case.
Second, well-settled is the rule that procedural
technicalities do not strictly apply to proceedings before
labor arbiters for they may avail themselves of all
reasonable 13means to speedily ascertain the facts of a
controversy.

3. Petitioner claims that the findings of respondent

commission to the effect that the former failed to
adduce an iota of evidence that would account for
the alleged “loss of confidence” is erroneous.
Petitioner raised in its position paper filed before
the labor arbiter the following facts which allegedly
constitute the basis for the loss of trust and
confidence, to wit:

“Complainant, during the trying times of new management take

over, beset by shaky industrial relations, culminating in mass
action, despite requests by new managers was nowhere to be
found. If she was interested to maintain her position, she could
have at least reported to the company and brief the new managers
of the existing personnel problems. This, she opted not to do, in
fact her ‘leave of absence’ (was placed under quote as there is
nothing on record that she was granted a one month leave of
absence) ended March 7, 1986, it was only on 14
March 31, 1986 that
she wrote the letter opting for resignation.”

Although loss of confidence is a valid cause to terminate an

employee, it must nonetheless rest on an actual breach of
duty committed by the employee and not on the employer’s
ca-

________________

12 Rollo, 78.
13 Bristol Laboratories Employees’ Association-DFA, et. al., vs. National
Labor Relations Commission, et. al., 187 SCRA 118 (1990).
14 Rollo, 13.

245

VOL. 217, JANUARY 19, 1993 245

Imperial Textile Mills, Inc. vs. NLRC

15
prices. The burden of proof rests upon 16the employer to
establish that the dismissal is for cause in view of the
security of tenure that employees 17
enjoy under the
Constitution and the Labor Code. The failure of the
employer18 to do so would mean that the dismissal is not
justified. It is likewise essential that there be substantial
evidence to support a charge of loss of confidence. The
employer’s evidence must clearly and convincingly
establish the facts upon which the loss19
of confidence in the
employee may fairly be made to rest.
In the case at bar, the facts relied upon by petitioner
barely establish any basis for the alleged loss of confidence.
As it is, the same is, at most, a mere allegation.
In addition, we have ruled that to constitute a valid
dismissal, two requisites must concur: (1) the dismissal
must be for any of the causes provided for under Article
282 of the Labor Code, and (2) only after the employee has
been notified in writing and given the opportunity to be
heard and defend himself as required under Sections20
2 and
5, Rule XIV, Book V of the Implementing Rules. In the
case at bar, petitioner categorically stated in its position
paper that “(t)here was never any official communication
from the new management group of the company addressed 21
to the complainant that her services were terminated,”
and yet it does not deny that it had appointed a
replacement for private respondent even before she wrote
her aforequoted letter of March 31, 1986.

_______________

15 Anscor Transport & Terminals, Inc. vs. National Labor Relations

Commission, et. al., 190 SCRA 147 (1990).
16 Marina Port Services, Inc. vs. National Labor Relations Commission,
et. al., 193 SCRA 420 (1991).
17 Manggagawa ng Komunikasyon sa Pilipinas, et. al., vs. National
Labor Relations Commission, et. al., 194 SCRA 573 (1991).
18 Marina Port Services, Inc. vs. National Labor Relations Commission,
et. al., supra.
19 Commercial Motors Corporation vs. Commissioners, et. al., 192
SCRA 191 (1990).
20 Shoemart, Inc., et. al. vs. National Labor Relations Commission, et.
al., 176 SCRA 385 (1989).
21 Rollo, 59.

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246 SUPREME COURT REPORTS ANNOTATED

Imperial Textile Mills, Inc. vs. NLRC

4. Finally, petitioner asserts that findings of fact of

the labor arbiter should be accorded respect and
finality. Besides, the decision of the labor arbiter
had become final considering that the appeal made
by private respondent with respondent commission
was filed out of time. Records show that the
decision of the labor arbiter was received by private
respondent on May 2, 1990, whereas the appeal was
filed with respondent commission only on May 17,
1990, which is already beyond the 10-day
reglementary period provided in the Labor Code.

While it is true that factual findings of the labor arbiter are

usually binding on this Court, such situation does not
obtain in this case. As we have earlier declared, the alleged
loss of confidence was never sufficiently proven by herein
petitioner.
It appears that the appeal with respondent commission
was indeed filed late. The general rule is that the
perfection of an appeal in the manner and within the
period prescribed by law is not only mandatory but
jurisdictional. Failure to conform to the rules will render
the judgment 22
sought to be reviewed final and
unappealable.
We also note, in passing, that contrary to the Solicitor
Gen-eral’s allegation that petitioner failed to raise the issue
of timeliness of appeal before the respondent commission
and is, therefore, deemed to have waived its right to
question the same, herein petitioner did raise this issue
albeit belatedly, in its 23
reply to private respondent’s
memorandum of appeal.
Nevertheless, in some instances, this Court has
disregarded such unintended lapses so as to give due
course to appeals filed beyond the reglementary period on
the basis of strong and compelling reasons, such as serving
the ends24
of justice and preventing a grave miscarriage
thereof. We are of the opinion and so hold that in
consideration of the merits of this case,

________________

22 Colegio del Sto. Niño, et. al. vs. National Labor Relations
Commission, et. al., 197 SCRA 611 (1991).
23 Rollo, 101.
24 The Insular Life Assurance Co., Ltd., et. al. vs. National Labor
Relations Commission, et. al., 156 SCRA 740 (1987); Paramount Vinyl
Products Corporation vs. National Labor Relations Commission, et. al.,
190 SCRA 525 (1990).

247

VOL. 217, JANUARY 19, 1993 247

Imperial Textile Mills, Inc. vs. NLRC

substantial justice could be rightfully invoked by

way of an exception. This is one such case where we
are convinced that substance should prevail over
and not be sacrificed for form.
5. Petitioner asseverates that since private
respondent is already employed elsewhere,
respondent commission erred in awarding
separation pay and three years backwages. We
disagree.
25
In the case of Torillo vs. Leogardo, Jr., etc., et. al., we held:

“Backwages and reinstatement are two reliefs given to an illegally

dismissed employee. They are separate and distinct from each
other. However, in the event that reinstatement is no longer
possible, separation pay is awarded to the employee. Thus, the
award of separation pay is in lieu of reinstatement and not of
backwages. In other words, an illegally dismissed employee is
entitled to (1) either reinstatement, if viable, or separation pay if
reinstatement is no longer viable and (2) backwages.”

The payment of backwages is one of the reliefs which an

illegally dismissed employee prays the labor arbiter and
the National Labor Relations Commission to render in his
favor as a consequence of the unlawful act committed by
the employer. The award thereof is not private
compensation or damages but is in furtherance and
effectuation of the public objectives of the Labor Code.
Even though the practical effect is the enrichment of the
individual, the award of backwages is not in redress of a
private right, but, rather, is in the nature of a command
upon the employer to make 26
public reparation for his
violation of the Labor Code, such as the dismissal of an
employee due to the27
unlawful act of the employer or the
latter’s bad faith. Hence, we have ruled that where the
ground of loss of confidence has neither been established
nor sufficient basis thereof presented, the finding that
respondent employee was illegally dismissed was well
taken and said employee, although not reinstated, was

________________

25 197 SCRA 471 (1991).

26 Callanta vs. Carnation Phils., Inc., et. al., 145 SCRA 268 (1986).
27 Reyes vs. Minister of Labor, et. al., 170 SCRA 134 (1989).

248

248 SUPREME COURT REPORTS ANNOTATED

Imperial Textile Mills, Inc. vs. NLRC

28
awarded three years backwages.
With respect to the award of separation pay, we declared
in Santos
29
vs. National Labor Relations Commission, et.
al., that where the decision ordering the reinstatement of
the employee may no longer be enforced, or is no longer
feasible because of the strained relations between the
parties, the employee may be awarded separation pay as an
alternative to reinstatement. Such a situation obtains in
this case and considering further the confidential nature of
private respondent’s position, we find no reason why the
foregoing doctrine should not here apply.
WHEREFORE, no grave abuse of discretion having been
committed by respondent commission, the present petition
is hereby DISMISSED for lack of merit.
SO ORDERED.

          Narvasa, (C.J., Chairman), Feliciano, Nocon and

Campos, Jr., JJ., concur.

Petition dismissed.

Note.—Strained relations to justify award of separation

pay in lieu of reinstatement with backwages must be so
compelling and so serious (Sibal vs. Notre Dame of Greater
Manila, 182 SCRA 538).

——o0o——

____________________

28 Citytrust Finance Corporation vs. National Labor Relations

Commission, et. al., 157 SCRA 87 (1988).
29 154 SCRA 166 (1987); see also Torillo vs. Leogardo, et. al., supra.

249

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