Employers have the right to exercise management prerogative on how to run the company and who to employ provided that justice and due process are observed.
To make the company profitable and services efficient, the management adopts polices on employment, including: [1] anti-nepotism policy, which prohibits close relatives from working in the same company. This was held valid for it prevents the hiring of unqualified persons based on their status as a relative, rather than upon their ability; [2] endogamy policy disallowing employee to marry employee of competitor company; [3] no-spouse employment or exogamy policy prohibiting marriage between employees within the same company.
On August 23, 2022, our Honorable Supreme Court released its 22 June 2022 Decision on the legality of exogamy policy in the case of Dela Cruz-Cagampan vs. One Network Bank, Inc., G.R. No. 217414.
The facts are: In 2004, the bank hired Cath as Accounting Specialist. In 2006, the bank implemented an exogamy policy [that makes marriage within the company a ground for dismissal]. In 2009, Cath married Audie, her co-employee. They asked the bank president that they be allowed to continue working, but was denied.
Instead, the bank’s HR head terminated Cath. She filed a labor case. The Labor Arbiter ruled Cath was illegally dismissed. It ordered the bank to reinstate her and pay full backwages [P100,690.85].
On appeal, the National Labor Relations Commission affirmed said decision. However, the Court of Appeals reversed the NLRC’s decision and ruled that prohibiting marriage among bank employees is a valid management prerogative to maintain confidentiality of information of its clients. Cath appealed raising the legality of bank’s policy of exogamy that prohibits marriage inside the company.
The Supreme Court ruled that the Constitution mandates the State to afford full protection to labor, equality of employment opportunities and guarantees security of tenure.
Under the Magna Carta of Women, “the State [gov’t] commits to eliminate discrimination against women and ensures their right to freely choose a spouse.
Under Article 134 of the Labor Code, it is unlawful for employer to require, as a condition for or continuation of employment that a woman shall not get married or to enter a contract that the woman shall be deemed resigned or separated when she gets married.
The bank implemented a policy stating that “when two employees working gets married, one will be terminated. The bank argued that the couple knew the company policy and violated it. The dismissal of a female employee solely because of her marriage is precisely the discrimination that the Labor Code expressly prohibits. An employer’s blanket policy of no-spouse employment is discriminatory.
To justify its enforcement, the employer must establish a reasonable business necessity. Weight against the constitutionally- mandated full protection to labor and the various protective laws to women, the bank failed to show the reasonable business necessity for its no-spouse employment policy.
In fact, the no-spouse qualification is not related to the bank’s essential operation in its business. It unduly discourages employees from marrying a fellow worker at the pain of termination.
The fear of management of the possibility that spouses may reveal to each other secret information of the bank client’s accounts is more imagined than real. The reasonable relation between a discriminatory policy and employer’s industry shall excuse its implementation must be based on facts, not mere surmises [maritess].
Friends, lovers and couples share secrets. Any bank employee may potentially craft elaborate schemes to embezzle the bank’s funds. While a bank must observe high standards of diligence, enforcing an arbitrary no-spouse employment rule that directs immediate dismissal of an employee who marries a co-worker cannot be justified. That is illegal dismissal.
