1. Alan Gustilo v. Wyeth Philippines, Inc., Filemon Verzano, Jr.

, Aurelio Mercado And Edgar Epilepsia

G.R. No. 149629 | October 4, 2004 | Sandoval-Gutierrez, J.

Summary: Sir Allan was employed by Wyeth as a pharmaceutical territory manager. His records show that Wyeth on various dates,
reprimanded and suspended him for habitually neglecting to submit his periodic reports. Wyeth was eventually forced to dismiss
him. He sued Wyeth for illegal dismissal. LA sided with him, NLRC affirmed, but CA reversed. Although the CA held that he was
validly dismissed (for gross, habitual neglect of his duties), it appreciated mitigating factors (length of service, loyalty awards,
Verzano’s “grudge” against him). CA held that those factors mean he should be reinstated and only deprived of backwages and
other benefits. But due to strained relations with his immediate supervisor Verzano, he should be paid separation pay instead of
being reinstated. Gustilo appealed to the SC. The SC ruled that 1) there was valid dismissal; 2) CA was wrong to apply the equity
rule of mitigating factors leading to a penalty lower than dismissal (reinstatement minus backwages), because he was a repeat
offender and his offenses show he is plain dishonest; 3) by coming to court with unclean hands, he should get no separation-pay-
as-financial-assistance package; 4) BUT AS WYETH DID NOT APPEAL, SC cannot grant it affirmative relief of overturning the CA
decision.
Doctrine: Gustilo is a habitual offender whose numerous contraventions of company rules has left Wyeth with no choice but to
terminate his services. Records show the various violations of Wyeth’s rules and regulations committed by petitioner. His
dismissal from the service is, therefore, in order.
In Piedad vs. Lanao del Norte Electric Cooperative, Inc., SC ruled that a series of irregularities when put together may constitute
serious misconduct, which under Article 282 of the Labor Code, as amended, is a just cause for dismissal.

Facts:
On November 7, 1990, Alan D. Gustilo, was employed by Wyeth Philippines, Inc. as a pharmaceutical territory manager.
→ Eventually, he was placed in charge of its various branches in Metro Bacolod City and Negros Occidental.
→ He performed various functions, such as visiting hospitals, pharmacies, drugstores and physicians concerned; preparing
and submitting his pre-dated itinerary; and submitting periodic reports of his daily call visits, monthly itinerary, and weekly
locator and incurred expenses.
Petitioners employment records show that Wyeth, on various dates, reprimanded and suspended him for habitually neglecting to
submit his periodic reports.
→ November 28, 1994 - Wyeth sent petitioner a notice reprimanding him for submitting late his weekly expense report.
→ July 5, 1995 - he was late in submitting the same report, prompting Wyeth to suspend him for five (5) days.
→ Still, petitioner repeatedly incurred delay in submitting his daily call reports dated October 16-20, 1995, October 23-27, 1995,
November 6-10, 1995, and November 13-17, 1995.
→ He did not submit his daily call reports for the period from November 20 to 24, 1995.
→ As a consequence, Wyeth sent petitioner another notice suspending him for fifteen (15) days or from January 2 to 22, 1996.
Meantime, Wyeth, after integrating its pharmaceutical products with Lederle, a sister company, conducted a nationwide on-the-job
training of sales personnel.
→ With this development, petitioner was assigned in charge of promoting four (4) Lederle pharmaceutical products.
Subsequently, petitioner submitted to Wyeth a plan of action dated February 6, 1996 where he committed to make an average of 18
daily calls to physicians; submit promptly all periodic reports; and ensure 95% territory program performance for every cycle.
However, petitioner failed to achieve the said objectives, prompting respondent company to send him two (2) separate notices dated
February 20, 1996 and April 10, 1996, charging him with willful violation of company rules and regulations and directing him to submit
a written explanation.
→ In his explanation, petitioner stated that he was overworked and an object of reprisal by his immediate supervisor.
May 22, 1996 - Upon recommendation of a Review Panel, respondent company terminated the services of petitioner.
Petitioner filed complaint for illegal dismissal
LA ruled for pet; he was illegally dismissed
NLRC affirmed
CA reversed NLRC
→ dismissing petitioner’s complaint for illegal dismissal, but awarding him separation pay considering the mitigating factors
of length of service, the loyalty awards he received, and respondent Verzanos grudge against him.
→ Gustilo cannot deny the numerous violations of company rules during his employment with Wyeth. Gustilo’s 201 file reveal
the following:
o he was suspended for falsifying, tampering and/or altering the gasoline receipt
o he was warned for false reporting of his trade outlet calls

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 o he was guilty of unauthorized availment of sick leaves, emergency leaves, vacation leaves and unauthorized
absences
o he was cited for his repeated delay in submitting his expense reports
o he was cited for failure to submit his expense report on time
o he was charged with breach of the rule on submission of required reports
o he was again cited for unauthorized absence on October 19, 1995 and other violations of company rules as
contained in a letter of the same date
→ From 1993 up to 1995, respondent has repeatedly guaranteed not to repeat transgressing company rules under pain of
termination, but to no avail
→ It has become clear that respondent Gustilo is a habitual offender whose numerous contraventions of company rules has
left Wyeth with no choice but to terminate him based on Article 282 of the Labor Code, gross and habitual neglect by the
employee of his duties, being a valid cause for termination.
→ While dismissal is proper, the Court however considers the length of service of respondent Gustilo with Wyeth, the loyalty
awards he received and the grudge of petitioner Verzano, Jr. as mitigating factors.
→ The CA is inclined to reinstate respondent Gustilo to his former position without backwages and other benefits.
→ However in view of the strained relationship between respondent Gustilo and petitioner Verzano, Jr., the Court rules to
award separation pay to respondent Gustilo in the amount of P106,890.00.

Issues:
1. W/N he was illegally dismissed – NO
2. W/N the award of separation pay by reason of several mitigating factors was proper - NO

HELD:
1. In Philippine Journalists, Inc. vs. Mosqueda
▪ The findings of fact by the CA are conclusive on the parties and are not reviewable by this Court.
i. The rationale behind this doctrine is that review of the findings of fact by the CA is not a function that the
Supreme Court normally undertakes.
▪ Here, the CA unequivocally ruled that Gustilo is a habitual offender whose numerous contraventions of company
rules has left Wyeth with no choice but to terminate his services.
▪ There is no cogent reason why the SC should not accord deference and finality to the CA’s factual findings which are
supported by substantial evidence as shown by the records
▪ In Family Planning Organization of the Philippines, Inc. vs. NLRC
○ It is the employer's prerogative to prescribe reasonable rules and regulations necessary or proper for the
conduct of its business or concern, to provide certain disciplinary measures to implement said rules and to
assure that the same be complied with.
○ At the same time, it is one of the fundamental duties of the employee to yield obedience to all reasonable
rules, orders, and instructions of the employer, and willful or intentional disobedience thereof, as a general
rule, justifies rescission of the contract of service and the preemptory dismissal of the employee."
▪ Records show the various violations of Wyeth’s rules and regulations committed by petitioner.
○ His dismissal from the service is, therefore, in order.
▪ In Piedad vs. Lanao del Norte Electric Cooperative, Inc., SC ruled that a series of irregularities when put together may
constitute serious misconduct, which under Article 282 of the Labor Code, as amended, is a just cause for dismissal.

2. The rule embodied in the Omnibus Rules Implementing the Labor Code is that a person dismissed for cause as defined therein is not
entitled to separation pay.
▪ However, in PLDT vs. NLRC and Abucay:
○ Separation pay shall be allowed as a measure of social justice only in those instances where the employee is
validly dismissed for causes other than serious misconduct or those reflecting on his moral character.
○ Where the reason for the valid dismissal is, x x x an offense involving moral turpitude x x x, the employer may not
be required to give the dismissed employee separation pay, or financial assistance, or whatever other name it is
called, on the ground of social justice.
▪ Similarly, in Telefunken Semiconductors Employees Union-FFW vs. Court of Appeals:
○ Where the employees dismissal was for a just cause, it would be neither fair nor just to allow the employee to recover
something he has not earned or could not have earned. This being so, there can be no award of backwages, for it
must be pointed out that while backwages are granted on the basis of equity for earnings which a worker or employee
has lost due to his illegal dismissal, where private respondents dismissal is for just cause, as in the case herein, there
is no factual or legal basis to order the payment of backwages; otherwise, private respondent would be unjustly
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 enriching herself at the expense of petitioners. (Cathedral School of Technology vs. National Labor Relations
Commission, 214 SCRA 551). Consequently, granting financial assistance to the strikers is clearly a specious
inconsistency (supra). We are of course aware that financial assistance may be allowed as a measure of social
justice in exceptional circumstances and as an equitable concession. We are likewise mindful that financial
assistance is allowed only in those instances where the employee is validly dismissed for causes other than
serious misconduct or those reflecting on his moral character (Zenco Sales, Inc. vs. National Labor Relations
Commission, 234 SCRA 689).
▪ In this case, SC finds no exceptional circumstances to warrant the grant of financial assistance or separation pay to
petitioner.
▪ It bears stressing that petitioner did not only violate company disciplinary rules and regulations.
○ As found by the CA, he falsified his employment application form by not stating therein that he is the nephew of
Mr. Danao, respondent Wyeth’s Nutritional Territory Manager.
○ Also, on February 2, 1993, he was suspended for falsifying a gasoline receipt.
○ On June 28, 1993, he was warned for submitting a false report of his trade outlet calls.
○ On September 8, 1993, he was found guilty of unauthorized availment of sick, vacation and emergency leaves.
○ These infractions manifest his slack of moral principle. In simple term, he is dishonest.
▪ Neither can petitioner find reliance on the policy of social justice.
○ As aptly held by the Court in the same case of Philippine Long Distance Telephone vs. NLRC and Abucay,
■ [T]hose who invoke social justice may do so only if their hands are clean and their motives blameless x x
x.
○ Here, petitioner failed to measure up to such requirement.

In sum, the Court finds that petitioner was legally dismissed from employment and is, therefore, not entitled to reinstatement or
an award of separation pay or other benefits. Unfortunately, respondent company did not interpose an appeal to this Court. Hence, no
affirmative relief can be extended to it. A party in a case who did not appeal is not entitled to any affirmative relief. Thus, respondent
company has to comply with the Appellate Courts mandate to grant petitioner his separation pay.

WHEREFORE, the petition is DENIED. Costs against petitioner. SO ORDERED.

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