26/04/2025
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| The Supreme Court (SC) has upheld the dismissal from service of an employee who tested positive for illegal drug use as it qualifies as serious misconduct, which is one of the just causes for termination under the Labor Code.
In an 11-page ruling penned by Associate Justice Jhosep Lopez, the SC Special Third Division has affirmed its earlier ruling, which dismissed the complaint for illegal dismissal filed by Joy Villarico, a crane operator of D.M. Consunji, Inc. (DMCI).
The legal dispute began when Villarico tested positive for tetrahydrocannabinol, a dangerous drug under Republic Act No. 9165, and was declared unfit to work during his preemployment medical examination. Villarico also tested positive in the confirmatory test. Thereafter the DMCI dismissed him from the service, citing its employee handbook, which states that the use of controlled substances is prohibited and punishable by dismissal.
This prompted Villarico to file a complaint for illegal dismissal before the labor arbiter, which was subsequently dismissed. According to the labor arbiter, there was no illegal dismissal since Villarico was not dismissed in the first place but his contract simply expired. The said disposition was later on upheld by the National Labor Relations Commission (NLRC) and the Court of Appeals, paving the way for him to elevate the case before the Supreme Court.
The high court ruled to affirm the ruling with modification, noting that Villarico is considered a regular employee since he was hired several times by DMCI for nine years. But the court said he was not illegally dismissed since his service was terminated for a just cause.
“We noted that Villarico was not able to dispute that he was found positive for prohibited drugs. In this regard, the use of illegal drugs qualifies as serious misconduct under Article 297 of the Labor Code. Since he was validly dismissed, Villarico was not entitled to back wages and separation pay in lieu of reinstatement," the SC said.
"Here, the dismissal of Villarico was for a just cause. To recall, he was dismissed by DMCI et al. since he tested positive for tetrahydrocannabinol, a dangerous drug under Republic Act No. 9165. We held that Villarico did not present evidence to refute the medical result...To reiterate, the use of illegal drugs qualifies as a serious misconduct, which is one of the just causes for termination under Article 297 of the Labor Code," the SC added.
However, the court denounced DMCI for not observing the requirements of due process in terminating Villarico's employment, as he was not given the required two notices before he was dismissed, making it liable for nominal damages.
“Clearly, the established rule is that failure to observe the procedural due process in dismissing an employee on the ground of just cause does not render the dismissal invalid or ineffectual but only subjects the employer to the payment of nominal damages in the amount of PHP 30,000.00," the SC said.
The court ordered the DMCI to pay Villarico nominal damages in the amount of PHP 30,000.00, 13th month pay, service incentive leave pay and attorney's fees.
