30. Sime Darby Pilipinas, Inc.

30. Sime Darby Pilipinas, Inc. vs. NLRC, G.R. No. 119205, 15 April 1998, 289 SCRA 86
Topic: What is the extent of management’s prerogative to prescribe working methods, time, place, manner and other aspects of work?

Sime Darby is engaged in the manufacture of automotive tires, tubes and other rubber products. Private respondent is an association of the monthly salaried employees of the Sime Darby factory workers in Marikina. Prior to the controversy, all employees of Sime Darby worked from 7:45am to 3:45pm with a 30-minute paid “on call” lunch break.
On August 14, 1992, the company issued a memorandum to all factory employees advising all its monthly salaried employees in Marikina Tire plant except those in the warehouse and Quality Assurance Dept., of a change in work schedules. (M-F, 7:45am-4:45pm and Sat 7:45am-11:45am) with cofee break of 10 minutes between 9:30am-10:30am and 2:30pm-3:30pm and lunch break between 12nn-1pm(M-F).
Because of this memorandum, the association filed a complaint in behalf of its members a complaint with labor Arbiter for unfair labor practice, discrimination and evasion of liability.
Labor arbiter dismissed the complaint on the grounds that the elimination of the 30 minute paid lunch break constituted a valid exercise of management prerogative. Sime Darby elevated it to the NLRC which initially dismissed the case. However, upon motion for reconsideration the NLRC reversed its earlier decision and favored the association of the employees.
Sime Darby filed the petition to the SC.

WON the act of management in revising the work schedule of its employees and discarding their paid lunch break is within the extent of management preroragtive

Yes. Every business enterprise endeavors to increase its profits. In the process, it may devise means to attain that goal. Even as the law is solicitous of the welfare of the employees, it must also protect the right of an employer to exercise what are clearly management prerogatives. Thus, management is free to regulate, according to its own discretion and judgment, all aspects of employment, including hiring, work assignments, working methods, time, place and manner of work, processes to be followed, supervision of workers, working regulations, transfer of employees, work supervision, lay off of workers and discipline, dismissal and recall of workers. Further, management retains the prerogative, whenever exigencies of the service so require, to change the working hours of its employees. So long as such prerogative is exercised in good faith for the advancement of the employer’s interest and not for the purpose of defeating or circumventing the rights of the employees under special laws or under valid agreements, this Court will uphold such exercise.

31. Sentinel Security Agency, Inc. vs. NLRC, G. R. No. 122468, Sept. 3, 1998
Topic: What is the extent of management’s prerogative to transfer or re-assign workers?
Transfer; concept and meaning.

Nature: Certiorari seeking the reversal of the two petitions to the NLRCFacts:
Five employees of Sentinel Security Agency filed for illegal dismissal against the Agency and its Client Philamlife Cebu and prayed for payment of salary differential, service incentive pay, and separation pay. The complainants were assigned to Philamlife Cebu but after nearly 20 years for some employees and more than 20 years for some, Philam requested on Dec 16,1993 that security guards be replaced in the Client’s offices in Cebu, Bacolod, CDO, Dipolog and Iligan.
Agency issued a Relief and Transfer Order replacing the guards and for them to be reassigned to other clients effective on Jan 16 1994. On Jan 18 and Feb 4 1994,the employees filed an illegal dismissal complaint because of a threat from the personnel manager who told them that they were replaced because they were old.
Hence the complaint against the Agency and the Client.
Client and Agency’s defense: No dismissal because the contract allows them to recall security guards from assigned posts at the will of either party and that the Agency is allowed for a period of not more than six months, to retain the complainants on floating status. Agency should have been given a chance to give new assignments to complainants.
Client’s defense: No ER-EE relationship. Job contract,separate corporate personalities and not necessary anddesirable to the business or trade

Whether or not the agency validly exercised the prerogative of management to transfer an employee from one office to another

No. The Agency illegally dismissed the complainants.
In several cases, the Court has recognized the prerogative of management to transfer an employee from one office to another within the same business establishment, as the exigency of the business may require, provided that the said transfer does not result in a demotion in rank or a diminution in salary, benefits and other privileges of the employee;[18] or is not unreasonable, inconvenient or prejudicial to the latter;[19] or is not used as a subterfuge by the employer to rid himself of an undesirable worker.[20]
A transfer means a movement (1) from one position to another of equivalent rank, level or salary, without a break in the service;[21] and (2) from one office to another within the same business establishment.[22] It is distinguished from a promotion in the sense that it involves a lateral change as opposed to a scalar ascent.[23]
However, this legally recognized concept of transfer was not implemented. The agency hired new security guards to replace the complainants, resulting in a lack of posts to which the complainants could have been reassigned. Thus, it refused to reassign Complainant Andoy when he reported for duty on February 2, 4 and 7, 1994; and merely told the other complainants on various dates from January 25 to 27, 1994 that they were already too old to be posted anywhere.

32. Mendoza vs. Rural Bank of Lucban, G. R. No. 155421
Topic: Transfer of employees, inherent right of management.
The Board of Directors of the Rural Bank of Lucban, Inc., issued Board Resolutions stating, “that in line with the policy of the bank to familiarize bank employees with the various phases of bank operations and further strengthen the existing internal control system[,] all officers and employees are subject to reshuffle of assignments. Moreover, this resolution does not preclude the transfer of assignment of bank officers and employees from the branch office to the head office and vice-versa.”
Mendoza was an appraiser for 6 years. As part of the reshuffling, he was assigned to the position of clerk. He complained to the management that the reshuffling is deemed to be a demotion without any legal basis.
Petitioner filed a Complaint before Arbitration Branch No. IV of the National Labor Relations Commission (NLRC). The Complaint — for illegal dismissal, underpayment, separation pay and damages..

Whether or not the Mendoza’s transfer to another position was a lawful exercise of management prerogative to transfer employees

Jurisprudence recognizes the exercise of management prerogatives. For this reason, courts often decline to interfere in legitimate business decisions of employers.[24] Indeed, labor laws discourage interference in employers’ judgments concerning the conduct of their business.[25] The law must protect not only the welfare of employees, but also the right of employers.
In the pursuit of its legitimate business interest, management has the prerogative to transfer or assign employees from one office or area of operation to another — provided there is no demotion in rank or diminution of salary, benefits, and other privileges; and the action is not motivated by discrimination, made in bad faith, or effected as a form of punishment or demotion without sufficient cause.[26] This privilege is inherent in the right of employers to control and manage their enterprise effectively.[27] The right of employees to security of tenure does not give them vested rights to their positions to the extent of depriving management of its prerogative to change their assignments or to transfer them.
Petitioner’s transfer was made in pursuit of respondent’s policy to “familiarize bank employees with the various phases of bank operations and further strengthen the existing internal control system”[33] of all officers and employees. We have previously held that employees may be transferred — based on their qualifications, aptitudes and competencies — to positions in which they can function with maximum benefit to the company.[34] There appears no justification for denying an employer the right to transfer employees to expand their competence and maximize their full potential for the advancement of the establishment. Petitioner was not singled out; other employees were also reassigned without their express consent.
Neither was there any demotion in the rank of petitioner; or any diminution of his salary, privileges and other benefits.
35. William Endeliseo Barroga vs. Data Center College of the Philippines
G.R. No.174158, June 2011
In November 1991, William Barroga was hired as an instructor by Data Center College in its Laoag City, Ilocos Norte campus. In June 1992, Barroga was re-assigned to Vigan, Ilocos Sur. Part of the deal for his re-assignment was that Barroga will receive a monthly allowance of P1,200.00 for board and lodging while performing his job in Vigan. However, Data Center made it clear in writing that Barroga is only entitled to the additional allowance while assigned in Vigan and such allowance may be changed or forfeited if he will be re-assigned somewhere. In 1994, he was recalled to Laoag. Later, Barroga was also assigned as the temporary Head of Education; he was also given a scholarship grant to support his post-graduate studies. In 2003, Barroga was advised that he will be transferred to Bangued, Abra. Barroga refused because his father was sick and second, he found out that there will be no additional allowance this time and that he will be working there as an instructor and not as a Head of Education. In the same year, he filed a labor case against Data College for constructive dismissal. Barroga alleged that the real purpose of his transfer is to demote him to the rank of an instructor from being the Head for Education performing administrative functions and that his re-assignment will entail an indirect reduction of his salary or diminution of pay considering that no additional allowance will be given to cover for board and lodging expenses. He claims that such additional allowance was given in the past and therefore cannot be discontinued and withdrawn without violating the prohibition against non-diminution of benefits.
ISSUE: Whether or not the absence of additional allowance in Barroga’s supposed re-assignment constitutes a diminution of benefits.
HELD: No. It is true that as a general rule, benefits and perks enjoyed by employees cannot be reduced and discontinued or diminished. But this rule is only applicable to grants or benefits which are founded on an express policy or has ripened into a practice over a long period which is consistent and deliberate. In the case at bar, Barroga’s additional allowance while in Vigan is not permanent. In fact, Data College made clear that such allowance is only applicable while Barroga is in Vigan and such allowance is no longer applicable if he is going to be assigned somewhere. Further, Data College showed that it is experiencing financial difficulties hence the need to withdraw the scholarship previously granted to Barroga. On the issue of his removal as Head for Education, the same is valid. Barroga was merely assigned in a temporary capacity, such designation is terminable at the pleasure of Data College which made such appointment.