Petitioner vs. vs. Respondents: First Division

FIRST DIVISION
[G.R. No. 106107. June 2, 1994.]
AGUSTIN CHU, petitioner, vs. NATIONAL LABOR RELATIONS

COMMISSION and VICTORIAS MILLING COMPANY, INC.,
respondents.
SYLLABUS
1. LABOR LAW AND OTHER SOCIAL LEGISLATIONS; MANAGEMENT'S RIGHT TO

TRANSFER EMPLOYEES' WORK STATION; CONSTRUED. — An owner of a business
enterprise is given considerable leeway in managing his business because it is deemed
important to society as a whole that he should succeed. Our law, therefore, recognizes
certain rights as inherent in the management of business enterprises. These rights are
collectively called management prerogatives or acts by which one directing a business is
able to control the variables thereof so as to enhance the chances of making a pro t.
"Together, they may be taken as the freedom to administer the affairs of a business
enterprise such that the costs of running it would be below the expected earnings or
receipts. In short, the elbow room in the quest for pro ts." One of the prerogatives of
management, and a very important one at that, is the right to transfer employees in their
work station. In Philippine Japan Active Carbon Corporation v. National Labor Relations
Commission, 171 SCRA 164 (1989), we held: "It is the employer's prerogative, based on its
assessment and perception of its employees' quali cations, aptitudes, and competence to
move them around in the various areas of its business operations in order to ascertain
where they will function with maximum bene t to the company. An employee's right to
security of tenure 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 he will be
most useful. When his transfer is not unreasonable, nor inconvenient, nor prejudicial to him,
and it does not involve a demotion in rank or a diminution of his salaries, bene ts, and
other privileges, the employee may not complain that it amounts to a constructive
dismissal." In Abbot Laboratories (Phils.) Inc. v. NLRC , 154 SCRA 713 (1987), we also held
in referring to the prerogative of transfer of employees, that: "This is a function associated
with the employer's inherent right to control and manage effectively its enterprise. Even as
the law is solicitous of the welfare of employees, it must also protect the right of an
employer to exercise what are clearly management prerogatives. The free will of
management to conduct its own business affairs to achieve its purpose cannot be denied."
2. ID.; ID.; EXCEPTION. — Of course, like other prerogatives, the right to transfer
or re-assign is subject to limitations arising under the law, contract or general principles of
fair play and justice. Jurisprudence proscribes transfers or reassignments of employees
when such acts are unreasonable and cause inconvenience or prejudice to them.
3. ID.; ID.; WAIVER; NOT APPROPRIATE IN CASE AT BAR. — Special Contract of
Employment" invoked by petitioner wherein private respondent had waived its right to
transfer or re-assign petitioner to any other position in the company. Before such right can
be deemed to have been waived or contracted away, the stipulation to that effect must be
clearly stated so as to leave no room to doubt the intentions of the parties. The mere
speci cation in the employment contract of the position to be held by the employee is not
such stipulation. As held in Philippine Japan Active Carbon Corporation v. National Labor
CD Technologies Asia, Inc. © 2018 cdasiaonline.com
Relations Commission, supra: "An employee's right to security of tenure does not give him
such a vested right in his position as would deprive the company of its prerogatives to
change his assignment or transfer him where he will be most useful." Petitioner's bare
assertion that the transfer was unreasonable and caused him inconvenience cannot
override the fact, as found by the Labor Arbiter and respondent Commission, that the
rotation was made in good faith and was not discriminatory, and that there was no
demotion in rank or a diminution of his salary, benefits and privileges.
DECISION
QUIASON , J : p
This is a petition for certiorari under Rule 65 of the Revised Rules of Court to reverse
and set aside the Decision of the Fourth Division of the National Labor Relations
Commission (NLRC) in Case No. 06-02-10081-89 which dismissed petitioner's appeal and
its Resolution dated March 20, 1992, which denied petitioner's motion for reconsideration.
cdll
We dismiss the petition.

I
Petitioner retired from the service of private respondent upon reaching the age of
sixty under its regular retirement program. He was granted an extension of service by the
Board of Directors of private respondent under a "Special Contract of Employment." The
contract provided, inter alia, that its term was for a period of one year commencing on
August 1, 1988; that petitioner was employed as Head of the Warehousing, Sugar,
Shipping and Marine Department; and that he was to receive a basic salary of P6,941.00
per month. cdrep
Private respondent issued Memorandum No. 1012-PS dated December 12, 1988
and Memorandum No. 1028-PS dated January 16, 1989, both providing for a rotation of
the personnel and other organizational changes. Pursuant to the memoranda, petitioner
was transferred to the Sugar Sales Department.
Petitioner protested his transfer and requested a reconsideration thereof, which
was denied. Consequently, on February 27, 1989, petitioner led a complaint for illegal
dismissal, contending that he was constructively dismissed from his employment (RAB IV
Case No. 06-02-10081-89).
In support of his decision holding that there was no constructive dismissal of
petitioner, the Labor Arbiter said that: (1) petitioner was transferred to the Sugar Sales
Department from the Warehousing, Sugar, Shipping and Marine Department, both of which
are under the Sugar Sales Area; (2) petitioner's transfer was without change in rank or
salary; (3) petitioner's designation in either department was the same; (4) the personnel
rotation was pursuant to organizational changes done in the valid exercise of management
prerogatives; (5) there was no bad faith in the transfer of petition, as other employees
similarly situated as he were likewise affected; and (6) petitioner failed to show that he
was prejudiced by the changes or transferred to a demeaning or humiliating position. prcd
Petitioner appealed to the NLRC which, in a resolution dated January 13, 1992,
a rmed the Labor Arbiter's decision. In a resolution dated March 20, 1992, the NLRC
denied petitioner's motion for reconsideration.
II
In this petition, petitioner contends that there was no valid exercise of management
prerogative because: (1) his transfer violated the "Special Contract of Employment" which
was the law between the parties; and (2) said transfer was unreasonable and caused
inconvenience to him.
Petitioner argues that private respondent's prerogative to transfer him was limited
by the "Special Contract of Employment," which was the "law" between the parties. Thus,
petitioner urges that private respondent, by employing him speci cally as Head of the
Warehousing, Sugar, Shipping, and Marine Department, waived its prerogative to reassign
him within the term of the contract to another department.
We disagree.
An owner of a business enterprise is given considerable leeway in managing his
business because it is deemed important to society as a whole that he should succeed.
Our law, therefore, recognizes certain rights as inherent in the management of business
enterprises. These rights are collectively called management prerogatives or acts by which
one directing a business is able to control the variables thereof so as to enhance the
chances of making a pro t. "Together, they may be taken as the freedom to administer the
affairs of a business enterprise such that the costs of running it would be below the
expected earnings or receipts. In short, the elbow room in the quest for pro ts" (Fernandez
and Quiason, The Law on Labor Relations, 1963 ed., p. 43). LLjur
One of the prerogatives of management, and a very important one at that, is the right
to transfer employees in their work station. In Philippine Japan Active Carbon Corporation
v. National Labor Relations Commission, 171 SCRA 164 (1989), we held:
"It is the employer's prerogative, based on its assessment and perception
of its employees' quali cations, aptitudes, and competence to move them around
in the various areas of its business operations in order to ascertain where they will
function with maximum bene t to the company. An employee's right to security
of tenure 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 he
will be most useful. When his transfer is not unreasonable, nor inconvenient, nor
prejudicial to him, and it does not involve a demotion in rank or a diminution of
his salaries, bene ts, and other privileges, the employee may not complain that it
amounts to a constructive dismissal."
I n Abbot Laboratories (Phils.) Inc. v. NLRC , 154 SCRA 713 (1987), we also held in
referring to the prerogative of transfer of employees, that:
"This is a function associated with the employer's inherent right to control and
manage effectively its enterprise. Even as the law is solicitous of the welfare of employees,
it must also protect the right of an employer to exercise what are clearly management
prerogatives. The free will of management to conduct its own business affairs to achieve
its purpose cannot be denied."
Of course, like other prerogatives, the right to transfer or re-assign is subject to
limitations arising under the law, contract or general principles of fair play and justice
(Abbot Laboratories (Phil.) Inc. v. NLRC, 154 SCRA 713 [1987]). Jurisprudence proscribes
transfers or reassignments of employees when such acts are unreasonable and cause
inconvenience or prejudice to them (Philippine Japan Active Carbon Corporation v. NLRC,
supra).
We nd nothing in the "Special Contract of Employment" invoked by petitioner
wherein private respondent had waived its right to transfer or re-assign petitioner to any
other position in the company. Before such right can be deemed to have been waived or
contracted away, the stipulation to that effect must be clearly stated so as to leave no
room to doubt the intentions of the parties. The mere speci cation in the employment
contract of the position to be held by the employee is not such stipulation. LLphil
As held in Philippine Japan Active Carbon Corporation v. National Labor Relations

Commission, supra:
"An employee's right to security of tenure does not give him such a vested
right in his position as would deprive the company of its prerogatives to change
his assignment or transfer him where he will be most useful."
Petitioner's bare assertion that the transfer was unreasonable and caused him
inconvenience cannot override the fact, as found by the Labor Arbiter and respondent
Commission, that the rotation was made in good faith and was not discriminatory, and that
there was no demotion in rank or a diminution of his salary, benefits and privileges. prcd
WHEREFORE, the petition for certiorari is DISMISSED.

SO ORDERED.
Davide, Jr., Bellosillo and Kapunan, JJ., concur.
Cruz, J., is on leave.

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FIRST DIVISION

[G.R. No. 106107. June 2, 1994.]

AGUSTIN CHU, petitioner, vs. NATIONAL LABOR RELATIONS

1. LABOR LAW AND OTHER SOCIAL LEGISLATIONS; MANAGEMENT'S RIGHT TO

We dismiss the petition.

As held in Philippine Japan Active Carbon Corporation v. National Labor Relations

WHEREFORE, the petition for certiorari is DISMISSED.

CD Technologies Asia, Inc. © 2018 cdasiaonline.com

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