Friday, January 19, 2024

Case Digest: Western Shipping vs. NLRC, G.R. No. 109717

 

Western Shipping vs. NLRC, 253 SCRA 405, G.R. No. 109717, February 9, 1996

Subject: Transportation Law


FACTS

Petitioner Western Shipping Agency, Inc. and its principal Yeh Shipping Co., Ltd., owners of M/V Sea Wealth, faced a legal challenge initiated by the private respondent, the vessel's master. Discharged on January 14, 1989, the master was accused of misconduct, particularly failing to notify the company about the vessel's arrival in Manila and allowing unauthorized passengers on board. The dismissal led to a complaint filed on March 1, 1989, alleging illegal termination, underpayment of salary, fixed overtime pay, and non-payment of wages.

Western Shipping justified the dismissal citing the master's failure to communicate and alleged safety violations. The Philippine Overseas Employment Administration (POEA) found in favor of the master, declaring his dismissal illegal. The POEA ordered petitioners to pay a total of US$45,643.00 representing salary for the unexpired contract, salary differentials, underpayment of family allotment, and conversion differences, plus attorney's fees.

Petitioners appealed to the National Labor Relations Commission (NLRC), which modified the POEA decision on March 20, 1992. The NLRC set aside the award for alleged salary differentials but affirmed the US$5,643.00 for the unexpired portion of the contract. It held Western Shipping and Yeh Shipping jointly and severally liable, with the bonding company, Philippine British Assurance Company, Inc., also held accountable.

ISSUE

Whether or not, Alexander Bao was rightfully dismissed for his failure to notify the petitioner of the vessel’s arrival in Manila and to provide life-saving equipment for the passengers he had allowed to board, as required by Section 1019 of the Philippine Merchant Marine Rules and Regulation.

RULING

No, Alexander Bao was illegally dismissed.

Under the law, Loss of confidence is a valid ground for the dismissal of managerial employees like petitioner herein, who was the master of a vessel. The loss of confidence must be substantiated by evidence. The burden of proof is on the employer to show grounds justifying the loss of confidence.

In this case, petitioners failed to discharge this burden, as the POEA and the NLRC found that: (1) the private respondent had taken on board the vessel the fifteen passengers with the knowledge of Noimi Zabala, the president of Western Shipping; (2) the clearance to sail issued by the Coast Guard, an agency of the government charged with the seaworthiness of vessels, establishes approval of the application for the boarding of the additional passengers and the safety of the vessel was not endangered by the presence of the additional passengers; (3) the vessel had adequate life-saving equipment; and (4) additional passengers were not ordinary passengers but the wives and children of the vessel’s complement, including private respondent’s wife. The private respondent, who had 15 years of maritime experience behind him, would unlikely allow unsafe passage. Therefore, the dismissal was illegal. 

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