China Banking Corporation v Borromeo

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China Banking Corporation v Borromeo
G.R. No. 156515

Facts:

Respondent Mariano Borromeo was Assistant Vice-President of the Branch Banking Group of China Banking Corporation for the Mindanao Area.

Without authority from the Executive Committee or Board of Directors of the bank, he approved several DAUD/BP (Drawn Against Uncollected Deposits/Bills Purhcased) accommodations amounting to P2,441,375 in favour of Joel Maniwan. Such checks, which are not sufficiently funded by cash, are generally not honoured by banks. This came to the knowledge of the bank authorities. A memorandum was issued to the Mariano seeking clarification relative to the matter. The respondent accepted full responsibility for committing an error in judgment and abuse of discretion.

Mariano resigned from the Bank and apologized “for all the trouble I have caused because of the Maniwan case.” The respondent, however, vehemently denied benefitting therefrom.

His acts having constituted violation of the Bank’s Code of Ethics, the respondent was directed to restitute the amount of P1,507,736.79 representing 90% of the total loss of P1,675,263.10 incurred by the Bank. However, in view of his resignation and considering the years of service in the Bank, the management earmarked only P836,637.08 from the respondent’s total separation benefits or pay. The said amount would be released upon recovery of the sums demanded from Maniwan in a civil case filed against him by the bank with the RTC in Cagayan de Oro City.

The respondent made a demand on the bank for the payment of his separation pay and other benefits, but the bank maintained its position to withhold the sum of P836,637.08. Thus, Mariano filed with the NLRC a complaint for payment of separation pay, mid-year bonus, profit share and damages against the bank.

The Labor Arbiter ruled in favour of the bank. Respondent appealed to the NLRC but it affirmed in toto the findings of the Labor Arbiter. The CA, however, alleging that respondent was denied his right to due process, set aside the NLRC decision and ordered that the records of the case be remanded to the Labor Arbiter for further hearings on the factual issues involved.

The bank filed a motion for reconsidered but denied the same. Hence, this petition.

Issue:

Whether or not the bank has the prerogative/right to impose on the respondent what it considered the appropriate penalty under the circumstances pursuant to its company rules and regulations.

Held:

The petition is meritorious.

The bank was left with no other course but to impose the ancillary penalty of restitution. It was certainly within the bank’s prerogative to impose on the respondent what it considered the appropriate penalty under the circumstances pursuant to its company rules and regulations.

The petitioner’s bank business is essentially imbued with public interest and owes great fidelity to the public it deals with. It is expected to exercise the highest degree of diligence in the selection and supervision of their employees. As a corollary, and like all other business enterprises, its prerogative to discipline its employees and to impose appropriate penalties on erring workers pursuant to company rules and regulations must be respected. The law, in protecting the rights of labor, authorized neither oppression nor self-destruction of an employer company which itself is possessed of rights that must be entitled to recognition and respect.

Significantly, the respondent is not wholly deprived of his separation benefits. As the Labor Arbiter stressed in his decision, “the separation benefits due the complainant were merely withheld. Even the petitioner bank itself gives “the assurance that as soon as the bank has satisfied a judgment in the civil case, the earmarked portion of his benefits will be released without delay.

WHEREFORE, the petition is granted. The decision of the CA is reversed and set aside. The Resolution of the NLRC is reinstated.

Acknowledgement: Flor Bonador