6. Constructive Dismissal vs. Demotion

Demotion

It involves a situation where an employee is relegated to a subordinate or less important position constituting a reduction to a lower grade or rank, with a corresponding decrease in duties and responsibilities, and usually accompanied by a decrease in salary.

When transfer is deemed to be constructive dismissal

A transfer may amount to constructive dismissal in any of the following circumstances:

• when the transfer is unreasonable, inconvenient or prejudicial to the employee;
• when the transfer involves a demotion in rank or diminution of salaries, benefits and other privileges; or
• when the employer performs a clear act of discrimination, insensibility, or disdain towards the employee, which forecloses any choice by the latter except to forego his continued employment.

Q: May the employer exercise his right to transfer an employee and compel the latter to accept the same if said transfer is coupled with or is in the nature of promotion?

A: NO. There is no law that compels an Ee to accept promotion. Promotion is in the nature of a gift or a reward which a person has a right to refuse. When an Ee refused to accept his promotion, he was exercising his right and cannot be punished for it. While it may be true that the right to transfer or reassign an Ee is an Er’s exclusive right and the prerogative of management, such right is not absolute. (Dosch v. NLRC and Northwest Airlines, G.R. No. 51182, 05 July 1983)

Q: Manalo is a faculty member of the Accountancy Department of Ateneo de Naga University's College of Commerce and also the part-time Manager of the Ateneo de Naga Multi- Purpose Cooperative. The Grievance Committee of the University found her in “fraud in issuance of official receipts, collection of cash without documented remittance to the cooperative, use of inappropriate forms of documents cash receipts” and, thus, recommended her dismissal. ” Instead of dismissing Manalo, the University President transferred Manalo to teach Economics in another Department. Was Manalo constructively dismissed?

A: NO. Transferring Ees, to the extent that it is done fairly and in good faith, is a valid exercise of management prerogative and will not, in and of itself, sustain a charge of constructive dismissal. In this case, the acts committed by Manalo run afoul from the principles of integrity and objectivity governing ethics and education in the accountancy profession as mandated by the International Federation of Accountants. Relevant as it is, ethical behavior takes on even greater significance in the education and training of individuals who are prospective members of the profession. Professionals who concurrently take on the role of educators act as gatekeepers to the esteemed ranks of a profession or as channels of skills and knowledge. (Manalo v. Ateneo De Naga University, et al., G.R. No. 185058, 09 Nov. 2015)

Burden of Proving that the Transfer was Reasonable

The Er must be able to show that the transfer is not unreasonable, inconvenient, or prejudicial to the Ee; nor does it involve a demotion in rank or a diminution of his salaries, privileges and other benefits. Should the Er fail to overcome this burden of proof, the Ee’s transfer shall be tantamount to constructive dismissal. (Blue Dairy Corporation v. NLRC, G.R. No. 129843, 14 Sept. 1999)