October 15, 2020

Resigned Employee is Considered Constructively Dismissed if an Employer Failed to Act Promptly and Sensitively on Her Sexual Harassment Complaint

By: Kathia Kierstin Chanyee

This is the recent ruling of the Supreme Court in a labor case entitled, “LBC Express-Vis Inc. vs. Monica Palco”, G.R. No. 217101, February 12, 2020. In the said case, petitioner LBC Express-Vis Inc. (“LBC”) questioned the Decision and Resolution of the Court of Appeals (“CA”), which affirmed the National Labor Relations Commission’s (“NLRC”) finding that LBC is liable for constructive dismissal.

Respondent Monica Palco (“Ms. Palco”) started working with LBC on January 16, 2009 and Mr. Arturo Batucan (“Mr. Batucan”) acted as her immediate supervisor. Ms. Palco noticed that Mr. Batucan often flirt with her and later started sexually harassing her. The final straw happened on May 1, 2010 when Mr. Batucan kissed Ms. Palco on the lips against her will. Ms. Palco felt angry and afraid but still she forced herself to report to work after the incident.

On May 5, 2010, Ms. Palco reported the incident to the LBC head office. Acting on her report, the LBC management advised Ms. Palco to request for a transfer to another team while they investigated the matter. On May 8, 2010, Ms. Palco returned to the LBC head office with her mother and submitted her formal complaint against Mr. Batucan then proceeded to the police station to report the incident. Because Ms. Palco sensed that LBC management did not act on her complaint, she resigned on May 14, 2010. She asserted that she was forced to quit since she no longer felt safe at work. It was only on July 20, 2010 that LBC held an administrative hearing on the incident. On that same day, Ms. Palco filed a complaint for illegal dismissal against LBC. The Labor Arbiter ruled in favor of Ms. Palco and held LBC and Mr. Batucan liable to Ms. Palco, which was later affirmed with modification by the NLRC and CA.

Aggrieved, LBC filed a Petition for Review on Certiorari before the Supreme Court and mainly argued that it should not be held liable for constructive dismissal as it did not commit any act of discrimination, insensibility or disdain towards Ms. Palco, nor did it establish a harsh, hostile or unfavorable work environment for her.

The Supreme Court ruled that LBC is liable for constructive dismissal and held:

“xxx Given these circumstances, the delay in acting on respondent’s case showed petitioner’s insensibility, indifference, and disregard for its employees’ security and welfare. In failing to act on respondent’s complaint with prompt and in choosing the resolution of the complaint hang in the air for a long period of time, it had shown that it did not accord her claims the necessary degree of importance, and at the best considered it a minor infraction that could wait. Petitioner, as it appears, belittled her allegations.


Furthermore, during the investigation, Batucan resumed his duties as usual. In the meantime, respondent consumed her vacation leaves just trying to avoid him while waiting for her transfer to another branch. Petitioner’s acts showed that it was respondent who had to change and adjust, and even transfer from her place of work, instead of Batucan. Petitioner thus cannot claim that it did not create a hostile, unfavorable, unreasonable work atmosphere for respondent.


This Court emphasizes that statements suggesting that the case is weak because there are no witnesses or bruises are highly sensitive to victims of sexual harassment. In stating that a sexual harassment case is hard to prove without witnesses or physical manifestations of force, employers discourage their employees from coming forward with sexual harassment incidents. They foster an environment in which employees feel that their word cannot be taken against the word of the perpetrator. In making these statements, the employer lends more credence to the perpetrator, even without the latter having been questioned or having submitted a written explanation. It allows the employee to feel that the sexual harassment complaint’s resolution has already been pre-determined against him or her.

Indifference to complaints of sexual harassment victims may no longer be tolerated. Recent social movements have raised awareness on the continued prevalence of sexual harassment, especially in the workplace, and revealed that one of the causes of its pervasiveness is the lack of concern, empathy and responsiveness to the situation. Many times, victims are blamed, hushed, and compelled to accept that it is just the way things are, and that they should either just leave or move on.


Petitioner’s insensibility to respondent’s sexual harassment case is a ground for constructive dismissal. In this instance, it cannot be denied that respondent was compelled to leave her employment because of the hostile and offensive work environment created and reinforced by Batucan and petitioner. She was thus clearly constructively dismissed.”


The above decision of the Supreme Court calls for employers to at least have in place company policy on handling sexual harassment complaints. For inquiries or in need of assistance in drafting company policies and employment contracts, Contact Us.