The Supreme Court (SC) has upheld the preventive suspension of a senior engineer by his employer, JGC Philippines Inc., in a dispute over software ownership.

In a decision dated 24 February 2025, written by Associate Justice Samuel H. Gaerlan, the SC’s Third Division ruled that JGC validly placed Santiago DJ. Sillano under preventive suspension while investigating his actions.

Court records show Sillano developed several programs while working for JGC. When a dispute arose over the software’s ownership — with Sillano claiming it as his and JGC asserting company ownership — Sillano activated security features that rendered the programs unusable.

In response, JGC suspended Sillano and requested an explanation. The company later demanded he unlock the programs and turn over the source codes, but Sillano refused, stating JGC had not proven ownership. Consequently, JGC fired Sillano for disobedience and filed a complaint against him for violating his employment contract. Sillano, in turn, sued JGC for illegal dismissal and suspension.

Sillano also filed a case with the Intellectual Property Office, which later ruled that he owned the software.

The Labor Arbiter initially ruled in favor of JGC, finding the dismissal valid. However, both the National Labor Relations Commission and the Court of Appeals (CA) disagreed, stating that while JGC was justified in suspending Sillano, his termination was not.

Sillano challenged the preventive suspension before the Supreme Court, which affirmed the CA’s decision and upheld its validity.

Under the Labor Code, an employer can preventively suspend an employee without pay for up to 30 days if the employee’s presence poses a threat to the company or its property. This suspension is considered a precautionary measure, not a punishment. When justified, the employee is not entitled to receive salaries and benefits for the suspension period.