Dear PAO,

Is it possible for an employee to be dismissed for neglect of duty when the omission was only an isolated situation? My cousin received a notice from her employer, asking her to explain the huge amount of losses their company incurred because of a lapse on her part. She feels that she might get terminated because her co-worker told her that it's a possibility even if it happened only once. Please advise.


Dear Tricia,

One of the causes for lawfully terminating private employees is their gross and habitual neglect of duty. This is clearly provided for under Article 297 of the Labor Code of the Philippines:

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"ART. 297 [282]. Termination by employer. - An employer may terminate an employment for any of the following causes: x x x

"Gross and habitual neglect by the employee of his duties; x x x."

From the very wordings of the foregoing provision, the employee's neglect of duty must be both gross and habitual in order to be considered a basis for dismissing a laborer. However, our Supreme Court has held in several cases that an employee's neglect of duty, though not habitual, may still cause an employee's dismissal if there are serious consequences for such isolated neglect. As elucidated in the case of School of the Holy Spirit of Quezon City and/or Sr. Crispina A. Tolentino v. Corazon P. Taguiam (GR 165565, July 14, 2008, Ponente: Associate Justice Leonardo Quisumbing), the Supreme Court elucidated that:

"Notably, respondent's negligence, although gross, was not habitual. In view of the considerable resultant damage, however, we are in agreement that the cause is sufficient to dismiss respondent. This is not the first time that we have departed from the requirements laid down by the law that neglect of duties must be both gross and habitual. In Philippine Airlines, Inc. v. NLRC, we ruled that Philippine Airlines (PAL) cannot be legally compelled to continue with the employment of a person admittedly guilty of gross negligence in the performance of his duties although it was his first offense. In that case, we noted that a mere delay on PAL's flight schedule due to aircraft damage entails problems like hotel accommodations for its passengers, re-booking, the possibility of lawsuits, and payment of special landing fees not to mention the soaring costs of replacing aircraft parts. In another case, Fuentes v. National Labor Relations Commission, we held that it would be unfair to compel Philippine Banking Corporation to continue employing its bank teller. In that case, we observed that although the teller's infraction was not habitual, a substantial amount of money was lost. The deposit slip had already been validated prior to its loss and the amount reflected thereon is already considered as current liabilities in the bank's balance sheet. Indeed, the sufficiency of the evidence as well as the resultant damage to the employer should be considered in the dismissal of the employee. In this case, the damage went as far as claiming the life of a child.

"As a result of gross negligence in the present case, petitioners lost its trust and confidence in respondent. Loss of trust and confidence to be a valid ground for dismissal must be based on a willful breach of trust and founded on clearly established facts. A breach is willful if it is done intentionally, knowingly and purposely, without justifiable excuse, as distinguished from an act done carelessly, thoughtlessly, heedlessly or inadvertently. x x x There must, therefore, be an actual breach of duty committed by the employee which must be established by substantial evidence." (Emphasis supplied)

Corollary, it is possible for your cousin to be dismissed if her omission, though an isolated instance, caused detrimental effects on the part of her employer and/or other company stakeholders. Nevertheless, her employer must proceed with proper investigation, affording your cousin procedural due process.

We hope that we were able to answer your queries. This advice is based solely on the facts you have narrated and our appreciation of the same. Our opinion may vary when other facts are changed or elaborated.

Editor's note: Dear PAO is a daily column of the Public Attorney's Office. Questions for Chief Acosta may be sent to [email protected]