FLOATING STATUS

Exocet Security and Allied Services Corp. and/or

Ma. Teresa Marcelo vs. Armando D. Serrano (G.R.
No. 198538, September 29, 2014
In accordance with the aforementioned ruling, the Department of Labor and
Employment (DOLE) issued Department Order No. 14, Series of 2001 (DO
14-01), entitled "GuidelinesGoverning the Employment and Working
Conditions of Security Guards and Similar Personnel in the Private
Security Industry," Section 6.5, in relation to Sec. 9.3, of which states that
the lack of service assignment for a continuous period of six (6) months is
an authorized cause for the termination of the employee, who is then
entitled to a separation pay equivalent to half month pay for every year of
service, viz:

6.5 Other Mandatory Benefits. Inappropriate cases, security guards/similar

personnel are entitled to the mandatory benefits as listed below, although
the same may not beincluded in the monthly cost distribution in the
contracts, except the required premiums form their coverage:

a. Maternity benefit as provided under SS Law;

b. Separation pay if the termination of employment is for authorized

cause as provided by law and as enumerated below:

Half-Month Pay Per Year of Service, but in no case less than One
Month Pay if separation pay is due to:

1. Retrenchment or reduction of personnel effected by

management to prevent serious losses;

2. Closure or cessation of operation of an establishment not

due to serious losses or financial reverses;

3. Illness or disease not curable within a period of 6 months and

continued employment is prohibited by law or prejudicial to the
employees health or that of coemployees;
 4. Lack of service assignment for a continuous period of 6
months.

xxxx

9.3 Reserved Status A security guard or similar personnel may be placed

in a work pool or on reserved status due to lack of service assignments
after the expiration or termination of the service contract with the
principalwhere he/she or assigned or due to temporary suspension of
agency operations.

No security guard or personnel can be placed in a work pool or on reserved

status in any of the following situations: a) after expiration of a service
contract if there are other principals where he/she can be assigned; b)
as a measure to constructively dismiss the security guard; and c) as an
act of retaliation for filing complaints against the employer on violations
of labor laws, among others.

If after the period of 6 months, the security agency/employer cannot

provide work or give assignment to the reserved security guard, the latter
can be dismissed from service and shall be entitled to separation pay as
described in subsection 6.5.

Security guards on reserved status who accept employment in other

security agencies or employers before the end of the above six-month
period may not be given separation pay. (emphasis supplied)

In Reyes v. RP Guardians Security Agency, Inc.,24 the Court explained the

application of DO 14-01 to security agencies and their security guards, and
the procedural requirements with which the securityagencies must comply:

Furthermore, the entitlement of the dismissed employee to separation pay

of one month for every year of service should not be confused with Section
6.5 (4) of DOLE D.O. No. 14 which grants a separation pay of one half
month for every year service x x x.

xxxx

The said provision contemplates a situation where a security guard is

removed for authorized causes such as when the security agency
experiences a surplus of security guards brought about by lack of clients.In
such a case, the security agency has the option to resort to retrenchment
upon compliance with the procedural requirements of "two-notice rule"set
forth in the Labor Code. (emphasis supplied)

Thus, to validly terminate a security guard for lack of service

assignment for a continuous period of six months under Secs. 6.5 and
9.3 of DO 14-01, the security agency must comply with the provisions of
Article 289 (previously Art. 283) of the Labor Code,25 which mandates that
a written notice should be served on the employee on temporary off-
detail or floating status and to the DOLE one (1) month before the
intended date of termination. This is also clear in Sec. 9.2of DO 14-01
which provides:

9.2 Notice of Termination - In caseof termination of employment due to

authorized causes provided in Article 283 and 284 of the Labor Code and
in the succeeding subsection, the employer shall serve a written notice on
the security guard/personnel and the DOLE at least one (1) month before
the intended date thereof.

In every case, the Court has declared that the burden of proving that
there are no posts available to which the security guard may be
assigned rests on the employer. We ruled in Nationwide Security and
Allied Services Inc. v. Valderama:26

In cases involving security guards,a relief and transfer order in itself does
not sever employment relationship between a security guard and his
agency. An employee has the right to security of tenure, but this does not
give him a vested right tohis position as would deprive the company of its
prerogative to change his assignment or transfer him where his service, as
securityguard, will be most beneficial to the client. Temporary "off-detail" or
the period of time security guards are made to wait until they are
transferred or assigned to a new post or client does not constitute
constructive dismissal, so long as such status does not continue beyond six
months.

The onus of proving that there is no post available to which the security
guard can be assigned rests on the employer x x x. (emphasis supplied)

It cannot, therefore, be gainsaid that the right of security guards to security

of tenure is safeguarded by administrative issuances and jurisprudence, in
parallel with the mandate of the Labor Code and the Constitution to protect
labor and the working people. Nonetheless, while the Court has recognized
the security guards right to security of tenure under the "floating status"
rule, the Court has similarly acknowledged the management prerogative of
security agencies to transfer security guards when necessary in conducting
its business, provided it is done in good faith. In Megaforce Security and
Allied Services, Inc. v. Lactao,27 the Court explained:

In cases involving security guards, a relief and transfer order in itself does
not sever employment relationship between a security guard and his
agency. An employee has the right tosecurity of tenure, but this does not
give him such a vested right in his position as would deprive the company
of its prerogative to change his assignment or transfer him where his
service, as security guard, will be most beneficial to the client. Temporary
"off-detail" or the period of time security guards are made to wait until they
are transferred or assigned to a new post or client does not constitute
constructive dismissal as their assignments primarily depend on the
contracts entered into by the security agencies with third parties.Indeed,
the Court has repeatedly recognized that "off-detailing" is not equivalent to
dismissal, so long as such status does not continue beyond a reasonable
time; when such a "floating status" lasts for more than six months, the
employee may be considered to have been constructively dismissed.
(emphasis supplied)

In the controversy now before the Court, there is no question that the
security guard, Serrano, was placed on floating status after his relief from
his post as a VIP security by his security agencys client. Yet, there is no
showing that his security agency, petitioner Exocet, acted in bad faith when
it placed Serrano on such floating status. What is more, the present case is
not a situation where Exocet did not recall Serrano to work within the six-
month period as required by law and jurisprudence. Exocet did, in fact,
make an offer to Serrano to go back to work. It is just that the assignment
although it does not involvea demotion in rank or diminution in salary, pay,
benefits or privilegeswas not the security detail desired by Serrano.

Clearly, Serranos lack of assignment for more than six months cannot
be attributed to petitioner Exocet.1avvphi1 On the contrary, records
show that, as early as September 2006, or one month after Serrano was
relieved as a VIP security, Exocet had already offered Serrano a position in
the general security service because there were no available clients
requiring positions for VIP security. Notably, even though the new
assignment does not involve a demotion in rank or diminution in salary,
pay, or benefits, Serrano declined the position because it was not the post
that suited his preference, as he insisted on being a VIP Security.

In fact, even during the meeting with the Labor Arbiter, Exocet offered
a position in the general security only to be rebuffed by Serrano. 28 It
was as if Serrano obliged Exocet to look for a client in need of a VIP
securitythe availability of which is obviously not within Exocets control,
and by nature, difficult to procure as these contracts depend on the trust
and confidence of the client or principal on the security guard. As aptly
found by the NLRC:

Anent the clients action, respondent agency had no recourse but to assign
complainant to a new posting. However, complainant, having had a taste of
VIP detail and perhaps the perks that come with such kind of assignment,
vaingloriously assumed that he can only be assigned to VIP close-in
posting and that he would accept nothing less. In fact, after his relief and
tardy appearance at respondents office, he was offered reassignment
albeit to general security services which he refused. Respondents clearly
made known to him that as of the moment no VIP detail was vacant or
sought by other clients but complainant was adamant in his refusal.
Complainant even had the nerve to assert that he just be informed if there
is already a VIP detail available for him and that he will just report for re-
assignment by then. It is also well to note that to these allegations,
complainant made no denial.29 (emphasis supplied)

To repeat for emphasis, the security guards right to security of tenure does
not give him a vested right to the position as would deprive the company of
its prerogative to change the assignment of, or transfer the security guard
to, a station where his services would be most beneficial to the client.
Indeed, an employer has the right to transfer or assign its employees from
one office or area of operation to another, or in pursuit of its legitimate
business interest, provided there is no demotion in rank or diminution
of salary, benefits, and other privileges, and the transfer is not
motivated by discrimination or bad faith, or effected as a form of
punishment or demotion without sufficient cause.30

Thus, it is manifestly unfair and unacceptable to immediately declare

the mere lapse of the six-month period of floating status as a case of
constructive dismissal, without looking into the peculiar circumstances
that resulted in the security guards failure to assume another post. This is
especially true in the present case where the security guards own refusal
to accept a non-VIP detail was the reason that he was not given an
assignment within the six-month period. The security agency, Exocet,
should not then be held liable.

Indeed, from the facts presented, Serrano was guilty of wilful

disobedience to a lawful order of his employer in connection with his work,
which is a just cause for his termination under Art. 288 (previously Art. 282)
of the Labor Code.31 Nonetheless, Exocet did not take Serranos wilful
disobedience against him. Hence, Exocetis considered to have waived its
right to terminate Serrano on such ground.

In this factual milieu, since respondent Serrano was not actually or

constructively dismissed from his employment by petitioner Exocet, it is
best that petitioner Exocet direct him to report for work, if any security
assignment is still available to him. If respondent Serrano stillrefuses to be
assigned to any available guard position, he shall be deemed to have
abandoned his employment with petitioner.

If no security assignment is available for respondent, petitioner Exocet

should comply with the requirements of DO 14-01, in relation to Art. 289 of
the Labor Code, and serve a written notice on Serrano and the DOLE one
(1) month before the intended date of termination, and pay Serrano
separation pay equivalent to half month pay for every year of his actual
service.

As a final note, the Court reiterates that it stands to promote the welfare of
employees and continue to apply the mantle of protectionism in their favor.
Thus, employees, like securityguards, should not be laid-off for an indefinite
period of time. However, We hold that a similar protection should be given
to employers who, ingood faith, have exerted efforts to comply with the
requirements of the law by offering reasonable work and appropriate
assignments during the six-month period. After all, the constitutional policy
of providing full protection to labor is not intended to oppress or destroy
management, and the commitment of this Court to the cause of labor does
not prevent Us from sustaining the employer when it is in the right, as in
this case.32