Dear Attorney,

I am currently serving as a Restaurant General Manager for three stores, a position I have held since January 2024. Each store under my supervision has assigned managers and supervisors to oversee daily operations. Recently, discrepancies or variances in certain inventory items were reported in two of these stores. Subsequently, I received a Notice to Explain (NTE) regarding these variances and am potentially facing charges such as tampering of documents, pilferage, gross negligence, culpable carelessness, and failure to follow specific instructions resulting in loss or damage to company property.

During the time in question, I was actively rotating among the three stores to manage operations. It is also important to note that several store managers were issued NTEs for similar variances, but I observed that not all of them were subjected to preventive suspension. This discrepancy raises concerns regarding the legality and fairness of such a practice. Could you provide guidance on how I should proceed and clarify whether the company's actions align with labor laws?

Sincerely,
A Concerned Manager

Legal Analysis and Insights: Addressing Workplace Variances and Associated Liabilities

The concerns raised in your situation delve into critical issues of labor law, accountability, and procedural fairness. To address your concerns comprehensively, we must examine the relevant legal principles, labor jurisprudence, and procedural safeguards applicable to your case under Philippine law.

I. Overview of Employer-Employee Obligations and Accountability

1. Employer’s Obligation to Maintain Fair and Transparent Disciplinary Procedures
Under the Labor Code of the Philippines, employers are required to adopt and enforce fair disciplinary policies. This includes conducting investigations into allegations of misconduct and providing due process to employees who are implicated. Due process entails two critical components:

Substantive Due Process: The employer must have just or authorized cause for imposing disciplinary action.
Procedural Due Process: The employer must observe procedural fairness by notifying the employee of the charges and giving them the opportunity to explain their side.

2. Accountability of Supervisors and Managers
As a general rule, managerial employees are held to higher standards of accountability due to their roles in overseeing operations and ensuring compliance with company policies. However, such accountability must be balanced with the principle of fairness, particularly in cases where liability may arise from actions beyond a manager’s direct control.

II. Analysis of Potential Charges Against You

1. Tampering of Documents and Pilferage

Legal Elements: Tampering and pilferage require proof of intent. This means the employer must demonstrate that you willfully altered documents or unlawfully appropriated company property for personal gain.
Defense: If the variances resulted from systemic issues, lapses in operational processes, or misconduct by other employees, you can argue the absence of malicious intent.

2. Gross Negligence and Culpable Carelessness

Definition: Gross negligence involves the absence of the level of care that an ordinarily prudent manager would exercise under similar circumstances.
Scope of Responsibility: Managers are accountable for supervising store operations, but liability for specific variances may depend on the degree of control and oversight exercised in each store.

3. Failure to Follow Instructions Resulting in Loss or Damage

Evidence of Non-Compliance: The employer must establish that you received specific instructions and failed to act accordingly, directly resulting in the loss or damage.
Operational Realities: Factors such as your rotational responsibilities across three stores and the role of subordinate managers may mitigate direct liability.

III. Procedural Issues: Preventive Suspension

1. Legal Basis for Preventive Suspension
Preventive suspension is governed by Section 8 of DOLE Department Order No. 147-15, Series of 2015. It allows an employer to suspend an employee for a maximum of 30 days when:

The employee’s continued presence in the workplace poses a serious and imminent threat to the company or its employees.
The suspension is necessary to prevent interference with the investigation.

2. Unequal Treatment of Employees
The selective application of preventive suspension raises potential issues of unfair labor practice (ULP). ULP involves acts of discrimination or favoritism that undermine the principles of equity and justice in the workplace.

IV. Recommendations for Addressing Your NTE

1. Prepare a Detailed Written Explanation

Acknowledge your role and responsibilities as a manager while clarifying your rotational duties and the limits of your direct control over store operations.
Highlight the measures you implemented to monitor and address variances, including issuing NTEs to subordinate managers.

2. Gather Evidence

Compile documentation showing your adherence to company policies and instructions.
Obtain records of variances in other stores under your management to demonstrate that discrepancies are systemic rather than individual.

3. Request an Internal Audit

Advocate for an impartial review of inventory processes to identify potential operational gaps.
Suggest involving independent auditors to ensure the investigation’s credibility.

V. Legal Protections Against Unjust Charges

1. Presumption of Innocence
As an employee, you are presumed innocent until proven guilty. The burden of proof lies with the employer to substantiate allegations of misconduct.

2. Prohibition Against Constructive Dismissal
Constructive dismissal occurs when an employee is placed in untenable working conditions or is unfairly singled out for disciplinary actions. Unequal treatment in preventive suspension may be cited as evidence of constructive dismissal.

3. Remedies for Unfair Labor Practices
If procedural irregularities or discriminatory practices are evident, you may file a complaint with the Department of Labor and Employment (DOLE) or the National Labor Relations Commission (NLRC) for redress.

VI. Conclusion and Practical Considerations

The allegations against you must be thoroughly examined within the context of operational realities, your managerial responsibilities, and the actions of subordinate employees. In responding to your NTE, focus on demonstrating:

Your proactive efforts to manage variances.
The shared accountability within the organization for inventory discrepancies.
Any procedural lapses or discriminatory practices in the company’s handling of the matter.

Should the situation escalate to formal charges or result in an adverse employment action, you may need to consult legal counsel to assert your rights and seek appropriate remedies.

By carefully navigating these issues, you can protect your professional integrity while ensuring compliance with labor laws and company policies.