SUPREME COURT
Manila
THIRD DIVISION
G.R. No. 179001
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Petitioners claimed that despite written warnings for repeated tardiness and
insubordination, Colambot failed to mend his ways. Hence, in a
Memorandum11 dated October 25, 2004 issued by petitioner Lea Timbal
(Timbal), MZR's Administrative Manager, Colambot was given a notice of
suspension for insubordination and negligence.
Again, in a Memorandum12 dated November 25, 2004, Colambot was
suspended from November 26, 2004 until December 6, 2004 for
insubordination. Allegedly, Colambot disobeyed and left the office despite
clear instructions to stay in the office because there was an important
meeting in preparation for a very important activity the following day.
Petitioners claimed they waited for Colambot to report back for work on
December 7, 2004, but they never heard from him anymore. Later,
petitioners were surprised to find out that Colambot had filed a complaint for
illegal suspension, underpayment of salaries, overtime pay, holiday pay, rest
day, service incentive leave and 13th month pay. On December 16, 2004, the
complaint was amended to illegal dismissal, illegal suspension,
underpayment of salaries, holiday pay, service incentive pay, 13th month
pay and separation pay.13
For his part, Colambot narrated that he worked as a messenger for
petitioners since February 2000. That on November 2004, he was directed to
take care of the processing of a document in Roxas Boulevard, Pasay City.
When he arrived at the office around 6 to 7 o'clock in the evening, he looked
for petitioner Quiroz to give the documents. The latter told him to wait for
her for a while. When respondent finally had the chance to talk to Quiroz, she
allegedly told him that she is dissatisfied already with his work performance.
Afterwards, Colambot claimed that he was made to choose between
resigning from the company or the company will be the one to terminate his
services. He said he refused to resign. Colambot alleged that Quiroz made
him sign a memorandum for his suspension, from November 26 to December
6, 2004. After affixing his signature, Quiroz told him that effective December
7, 2004, he is already deemed terminated. Later, on December 2, 2004,
respondent went back to the company to look for Timbal to get his salary. He
claimed that Timbal asked him to turn over his company I.D.14
Petitioners, however, insisted that while Colambot was suspended due to
insubordination and negligence, they maintained that they never terminated
Colambot's employment. They added that Colambot's failure to report for
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work since December 7, 2004 without any approved vacation or sick leave
constituted abandonment of his work, but they never terminated his
employment. Petitioners further emphasized that even with Colambot's filing
of the complaint against them, his employment with MZR has not been
terminated.
Colambot, meanwhile, argued that contrary to petitioners claim that he
abandoned his job, he claimed that he did not report back to work after the
expiration of his suspension on December 6, 2004, because Quiroz told him
that his employment was already terminated effective December 7, 2004.
On April 28, 2006, the Labor Arbiter rendered a Decision,15 the dispositive
portion of which reads:
WHEREFORE, premises considered, respondents are hereby declared guilty
of ILLEGAL DISMISSAL and hereby ORDERED to reinstate complainant to his
former position with full backwages from date of dismissal until actual
reinstatement and moral and exemplary damages in the sum of P100,000.00
and P50,000.00, respectively.
The computation of the judgment award marked as Annex "A" is part and
parcel of this decision.
SO ORDERED.16
The Labor Arbiter held that there was no abandonment as there was no
deliberate intent on the part of Colambot to sever the employer-employee
relationship. The Labor Arbiter likewise noted that Colambot should have
been notified to return back to work, which petitioner failed to do.
Aggrieved, petitioners appealed the decision before the NLRC.
On October 31, 2006, the NLRC rendered a Decision,17 the dispositive portion
of which reads as follows:
WHEREFORE, premises considered, the appeal filed by respondents is
GRANTED. The judgment of the Labor Arbiter dated April 28, 2006 is hereby
SET ASIDE and the Complaint is DISMISSED for lack of merit.
SO ORDERED.18
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The NLRC pointed out that Colambot's complaint was unsupported by any
evidence and was not even made under oath, thus, lacking in credibility and
probative value. The NLRC further believed that Colambot abandoned his
work due to his refusal to report for work after his suspension. The failure of
MZR to notify Colambot to return back to work is not tantamount to actual
dismissal.
Colambot filed a motion for reconsideration, but was denied. Thus, via a
petition for certiorari under Rule 65 of the Rules of Court, raising grave abuse
of discretion as a ground, Colambot appealed before the Court of Appeals
and sought that the Decision dated October 31, 2006 and Resolution dated
December 21, 2006 of the NLRC be reversed and set aside.
In the disputed Decision19 dated May 17, 2007, the Court of Appeals granted
the petition and reversed the assailed Decision dated October 31, 2006 and
Resolution dated December 21, 2006 of the NLRC. The Decision dated April
28, 2006 of the Labor Arbiter was ordered reinstated with modification that
in lieu of reinstatement, petitioners were ordered to pay respondent
separation pay equivalent to one (1) month pay for every year of service in
addition to full backwages.
The appellate court ruled that Colambot was illegally dismissed based on the
grounds that: (1) MZR failed to prove abandonment on the part of Colambot,
and (2) MZR failed to serve Colambot with the required written notices of
dismissal.2007.
Petitioners appealed, but was denied in a Resolution20 dated July 25, 2007.
Thus, via Rule 45 of the Rules of Court, before this Court, petitioners raised
the following issues:
I
THE HONORABLE COURT OF APPEALS ERRED IN RULING THAT COMPLAINANT
WAS ILLEGALLY DISMISSED FROM THE SERVICE.
II
THE HONORABLE COURT SERIOUSLY ERRED IN RULING THAT PETITIONER IS
ENTITLED TO SEPARATION PAY AND BACKWAGES.
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xxxx
Cases of insubordination and violations have been filed against you many
times. We kept on reminding that you should have changed and improved
your working attitudes because it greatly affects not only your working
performance but the company's productivity as well.
Your attitude only shows HARD HEADEDNESS AND LACK OF RESPECT TO
YOUR SUPERIORS which in any company cannot tolerate.
With these, you are suspended for 6 working days effective November 26,
2004, you will only report on December 7, 2004.
THIS IS OUR LAST WARNING FOR YOU TO IMPROVE, FAILURE TO DO SO MAY
MEAN TERMINATION OF YOUR EMPLOYMENT CONTRACT.
xxxx
While the same appeared to contain a warning of termination should
Colambot fail to improve his behavior, it is likewise apparent that there was
also a specific instruction for him to report back to work, on December 7,
2004, upon serving his suspension. The subject of the Letter, i.e.,
"Suspension due to Insubordination," the wordings and content of the letter
is a clear-cut notice of suspension, and not a notice of termination. The
notice of suspension may have contained warnings of termination, but it
must be noted that such was conditioned on the ground that Colambot
would fail to improve his attitude/behavior. There were no wordings
whatsoever implying actual or constructive dismissal. Thus, Colambot's
general allegation of having been orally dismissed from the service as
against the clear wordings and intent of the notice of suspension which he
signed, we are then inclined to believe that there was no dismissal.
In Machica v. Roosevelt Services Center, Inc.,25 this Court sustained the
employer's denial as against the employees' categorical assertion of illegal
dismissal. In so ruling, this Court held that:
The rule is that one who alleges a fact has the burden of proving it; thus,
petitioners were burdened to prove their allegation that respondents
dismissed them from their employment. It must be stressed that the
evidence to prove this fact must be clear, positive and convincing. The rule
that the employer bears the burden of proof in illegal dismissal cases finds
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must be a concurrence of the intention to abandon and some overt acts from
which an employee may be deduced as having no more intention to
work.31 On this point, the CA was correct when it held that:
Mere absence or failure to report for work, even after notice to return, is not
tantamount to abandonment. The burden of proof to show that there was
unjustified refusal to go back to work rests on the employer. Abandonment is
a matter of intention and cannot lightly be presumed from certain equivocal
acts. To constitute abandonment, there must be clear proof of deliberate and
unjustified intent to sever the employer-employee relationship. Clearly, the
operative act is still the employees ultimate act of putting an end to his
employment. Furthermore, it is a settled doctrine that the filing of a
complaint for illegal dismissal is inconsistent with abandonment of
employment. An employee who takes steps to protest his dismissal cannot
logically be said to have abandoned his work. the filing of such complaint is
proof enough of his desire to return to work, thus negating any suggestion of
abandonment.32
Suffice it to say that, it is the employer who has the burden of proof to show
a deliberate and unjustified refusal of the employee to resume his
employment without any intention of returning. It is therefore incumbent
upon petitioners to ascertain the respondents interest or non-interest in the
continuance of their employment. This, petitioners failed to do so.
These circumstances, taken together, the lack of evidence of dismissal and
the lack of intent on the part of the respondent to abandon his work, the
remedy is reinstatement but without backwages.33 However, considering that
reinstatement is no longer applicable due to the strained relationship
between the parties and that Colambot already found another employment,
each party must bear his or her own loss, thus, placing them on equal
footing.
Verily, in a case where the employee's failure to work was occasioned neither
by his abandonment nor by a termination, the burden of economic loss is not
rightfully shifted to the employer; each party must bear his own loss.34
WHEREFORE, premises considered and subject to the above disquisitions, the
Decision dated May 1 7, 2007 of the Court of Appeals is hereby REVERSED
and SET ASIDE. The Resolution dated October 31, 2006 of the National Labor
Relations Commission in NLRC NCR CASE No. 00-11-12189-04/ CA No.
049533-06 is hereby REINSTATED.
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SO ORDERED.
June 3, 2013
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SO ORDERED.7
Unilever asked for a reconsideration of the NLRC decision. In its Resolution,
dated March 31, 2009, the NLRC modified its earlier ruling by deleting the
award of separation pay and reducing the nominal damages fromP30,000.00
to P20,000.00, but affirmed the award of retirement benefits to Rivera. The
fallo reads:
WHEREFORE, foregoing premises considered, the instant Motion for Partial
Reconsideration is PARTLY GRANTED. The Resolution dated 28 November
2008 of the Commission is hereby
RECONSIDERED as follows:
(1)The award of separation pay is hereby deleted for lack of factual
and legal basis; and
(2)The award of nominal damages is hereby tempered and reduced to
the amount of P20,000.00.
The rest of the award for retirement benefits is affirmed in toto.
SO ORDERED.8
Unsatisfied with the ruling, Unilever elevated the case to CA-Cagayan de Oro
City via a petition for certiorari under Rule 65 of the Rules of Court.
On June 22, 2011, the CA affirmed with modification the NLRC resolution.
Justifying the deletion of the award of retirement benefits, the CA explained
that, indeed, under Unilevers Retirement Plan, a validly dismissed employee
cannot claim any retirement benefit regardless of the length of service. Thus,
Rivera is not entitled to any retirement benefit. It stated, however, that there
was no proof that she personally gained any pecuniary benefit from her
infractions, as her instructions were aimed at increasing the sales efficiency
of the company and competing in the local market. For said reason, the CA
awarded separation pay in her favor as a measure of social justice.9 The
decretal portion of the CA decision reads:
WHEREFORE, the assailed Resolution dated March 31, 2009 of the NLRC
(Branch 5), Cagayan De Oro City is hereby AFFIRMED with MODIFICATION.
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company rules, if any, are violated and/or which among the grounds
under Art. 282 is being charged against the employees.
(2) After serving the first notice, the employers should schedule and
conduct a hearing or conference wherein the employees will be given
the opportunity to: (1) explain and clarify their defenses to the charge
against them; (2) present evidence in support of their defenses; and
(3) rebut the evidence presented against them by the management.
During the hearing or conference, the employees are given the chance
to defend themselves personally, with the assistance of a
representative or counsel of their choice. Moreover, this conference or
hearing could be used by the parties as an opportunity to come to an
amicable settlement.
(3) After determining that termination of employment is justified, the
employers shall serve the employees a written notice of termination
indicating that: (1) all circumstances involving the charge against the
employees have been considered; and (2) grounds have been
established to justify the severance of their employment.29
In this case, Unilever was not direct and specific in its first notice to Rivera.
The words it used were couched in general terms and were in no way
informative of the charges against her that may result in her dismissal from
employment. Evidently, there was a violation of her right to statutory due
process warranting the payment of indemnity in the form of nominal
damages. Hence, the Court finds no compelling reason to reverse the award
of nominal damages in her favor. The Court, however, deems it proper to
increase the award of nominal damages from P20,000.00 to P30,000.00, as
initially awarded by the NLRC, in accordance with existing jurisprudence. 30
WHEREFORE, the petition is hereby PARTIALLY GRANTED.1wphi1 The June
22, 2011 Decision and the April 25, 2012 Resolution of the Court of Appeals
(CA)-Cagayan de Oro City in CA-G.R. SP No. 02963-MIN are AFFIRMED with
MODIFICATION. The dispositive portion should read as follows:
WHEREFORE, the March 31, 2009 Resolution of the NLRC (Branch 5),
Cagayan de Oro City, is hereby AFFIRMED with MODIFICATION. UNILEVER
PHILIPPINES, INC., is hereby directed to pay MARIA RUBY M. RIVERA the
following:
a) P30,000.00 as nominal damages; and
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This Petition for Review on Certiorari under Rule 45 assails and seeks to set
aside the July 3, 2008 Decision1 and December 15, 2008 Resolution2 of the
Court of Appeals (CA), in CA-G.R. SP No. 101309, entitled Armando Aliling v.
National Labor Relations Commission, Wide Wide World Express Corporation,
Jose B. Feliciano, Manuel F. San Mateo III and Joseph R. Lariosa. The assailed
issuances modified the Resolutions dated May 31, 20073 and August 31,
20074 rendered by the National Labor Relations Commission (NLRC) in NLRC
NCR Case No. 00-10-11166-2004, affirming the Decision dated April 25,
20065 of the Labor Arbiter.
The Facts
Via a letter dated June 2, 2004,6 respondent Wide Wide World Express
Corporation (WWWEC) offered to employ petitioner Armando Aliling (Aliling)
as "Account Executive (Seafreight Sales)," with the following compensation
package: a monthly salary of PhP 13,000, transportation allowance of PhP
3,000, clothing allowance of PhP 800, cost of living allowance of PhP 500,
each payable on a per month basis and a 14th month pay depending on the
profitability and availability of financial resources of the company. The offer
came with a six (6)-month probation period condition with this express
caveat: "Performance during [sic] probationary period shall be made as basis
for confirmation to Regular or Permanent Status."
On June 11, 2004, Aliling and WWWEC inked an Employment Contract7 under
the following terms, among others:
Armand,
My expectations is [sic] that GX Shuttles should be 80% full by the 3rd week
(August 5) after launch (July 15). Pls. make that happen. It has been more
than a month since you came in. I am expecting sales to be pumping in by
now. Thanks.
Nonong
Thereafter, in a letter of September 25, 2004,10 Joseph R. Lariosa (Lariosa),
Human Resources Manager of WWWEC, asked Aliling to report to the Human
Resources Department to explain his absence taken without leave from
September 20, 2004.
Aliling responded two days later. He denied being absent on the days in
question, attaching to his reply-letter11 a copy of his timesheet12 which
showed that he worked from September 20 to 24, 2004. Alilings explanation
came with a query regarding the withholding of his salary corresponding to
September 11 to 25, 2004.
In a separate letter dated September 27, 2004,13 Aliling wrote San Mateo
stating: "Pursuant to your instruction on September 20, 2004, I hereby
tender my resignation effective October 15, 2004." While WWWEC took no
action on his tender, Aliling nonetheless demanded reinstatement and a
written apology, claiming in a subsequent letter dated October 1, 200414 to
management that San Mateo had forced him to resign.
Lariosas response-letter of October 1, 2004,15 informed Aliling that his case
was still in the process of being evaluated. On October 6, 2004,16 Lariosa
again wrote, this time to advise Aliling of the termination of his services
effective as of that date owing to his "non-satisfactory performance" during
his probationary period. Records show that Aliling, for the period indicated,
was paid his outstanding salary which consisted of:
PhP 4,988.18 (salary for the September 25, 2004 payroll)
1,987.28 (salary for 4 days in October 2004)
-----------------PhP 6,975.46 Total
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The grounds upon which complainants dismissal was based did not conform
not only the standard but also the compliance required under Article 281 of
the Labor Code, Necessarily, complainants termination is not justified for
failure to comply with the mandate the law requires. Respondents should be
ordered to pay salaries corresponding to the unexpired portion of the
contract of employment and all other benefits amounting to a total of THIRTY
FIVE THOUSAND EIGHT HUNDRED ELEVEN PESOS (P35,811.00) covering the
period from October 6 to December 7, 2004, computed as follows:
Unexpired Portion of the Contract:
Basic Salary
Transportation
P13,000.00
3,000.00
Clothing Allowance
800.00
ECOLA
500.00
----------------P17,300.00
10/06/04 12/07/04
P17,300.00 x 2.7 mos. = P35,811.00
Complainants 13th month pay proportionately for 2004 was not shown to
have been paid to complainant, respondent be made liable to him therefore
computed at SIX THOUSAND FIVE HUNDRED THIRTY TWO PESOS AND 50/100
(P6,532.50).
For engaging the services of counsel to protect his interest, complainant is
likewise entitled to a 10% attorneys fees of the judgment amount. Such
other claims for lack of basis sufficient to support for their grant are
unwarranted.
WHEREFORE, judgment is hereby rendered ordering respondent company to
pay complainant Armando Aliling the sum of THIRTY FIVE THOUSAND EIGHT
HUNDRED ELEVEN PESOS (P35,811.00) representing his salaries and other
benefits as discussed above.
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deemed to have been hired from day one as a regular employee; and (c) the
strained relationship existing between the parties argues against the
propriety of reinstatement.
Alilings motion for reconsideration was rejected by the CA through the
assailed Resolution dated December 15, 2008.
Hence, the instant petition.
The Issues
Aliling raises the following issues for consideration:
A. The failure of the Court of Appeals to order reinstatement (despite
its finding that petitioner was illegally dismissed from employment) is
contrary to law and applicable jurisprudence.
B. The failure of the Court of Appeals to award backwages (even if it
did not order reinstatement) is contrary to law and applicable
jurisprudence.
C. The failure of the Court of Appeals to award moral and exemplary
damages (despite its finding that petitioner was dismissed to prevent
the acquisition of his regular status) is contrary to law and applicable
jurisprudence.25
In their Comment,26 respondents reiterated their position that WWWEC hired
petitioner on a probationary basis and fired him before he became a regular
employee.
The Courts Ruling
The petition is partly meritorious.
Petitioner is a regular employee
On a procedural matter, petitioner Aliling argues that WWWEC, not having
appealed from the judgment of CA which declared Aliling as a regular
employee from the time he signed the employment contract, is now
precluded from questioning the appellate courts determination as to the
nature of his employment.
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Petitioner errs. The Court has, when a case is on appeal, the authority to
review matters not specifically raised or assigned as error if their
consideration is necessary in reaching a just conclusion of the case. We said
as much in Sociedad Europea de Financiacion, SA v. Court of Appeals,27 "It is
axiomatic that an appeal, once accepted by this Court, throws the entire
case open to review, and that this Court has the authority to review matters
not specifically raised or assigned as error by the parties, if their
consideration is necessary in arriving at a just resolution of the case."
The issue of whether or not petitioner was, during the period material, a
probationary or regular employee is of pivotal import. Its resolution is
doubtless necessary at arriving at a fair and just disposition of the
controversy.
The Labor Arbiter cryptically held in his decision dated April 25, 2006 that:
Be that as it may, there appears no showing that indeed the said September
20, 2004 Memorandum addressed to complainant was received by him.
Moreover, complainants tasked where he was assigned was a new
developed service. In this regard, it is noted:
"Due process dictates that an employee be apprised beforehand of the
conditions of his employment and of the terms of advancement therein.
Precisely, implicit in Article 281 of the Labor Code is the requirement that
reasonable standards be previously made known by the employer to the
employee at the time of his engagement (Ibid, citing Sameer Overseas
Placement Agency, Inc. vs. NLRC, G.R. No. 132564, October 20, 1999). 28
From our review, it appears that the labor arbiter, and later the NLRC,
considered Aliling a probationary employee despite finding that he was not
informed of the reasonable standards by which his probationary employment
was to be judged.
The CA, on the other hand, citing Cielo v. National Labor Relations
Commission,29 ruled that petitioner was a regular employee from the outset
inasmuch as he was not informed of the standards by which his probationary
employment would be measured. The CA wrote:
Petitioner was regularized from the time of the execution of the employment
contract on June 11, 2004, although respondent company had arbitrarily
shortened his tenure. As pointed out, respondent company did not make
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(d) In all cases of probationary employment, the employer shall make known
to the employee the standards under which he will qualify as a regular
employee at the time of his engagement. Where no standards are made
known to the employee at that time, he shall be deemed a regular employee.
(Emphasis supplied.)
To repeat, the labor arbiter, NLRC and the CA are agreed, on the basis of
documentary evidence adduced, that respondent WWWEC did not inform
petitioner Aliling of the reasonable standards by which his probation would
be measured against at the time of his engagement. The Court is loathed to
interfere with this factual determination. As We have held:
Settled is the rule that the findings of the Labor Arbiter, when affirmed by the
NLRC and the Court of Appeals, are binding on the Supreme Court, unless
patently erroneous. It is not the function of the Supreme Court to analyze or
weigh all over again the evidence already considered in the proceedings
below. The jurisdiction of this Court in a petition for review on certiorari is
limited to reviewing only errors of law, not of fact, unless the factual findings
being assailed are not supported by evidence on record or the impugned
judgment is based on a misapprehension of facts.32
The more recent Peafrancia Tours and Travel Transport, Inc., v.
Sarmiento33 has reaffirmed the above ruling, to wit:
Finally, the CA affirmed the ruling of the NLRC and adopted as its own the
latter's factual findings. Long-established is the doctrine that findings of fact
of quasi-judicial bodies x x x are accorded respect, even finality, if supported
by substantial evidence. When passed upon and upheld by the CA, they are
binding and conclusive upon this Court and will not normally be disturbed.
Though this doctrine is not without exceptions, the Court finds that none are
applicable to the present case.
WWWEC also cannot validly argue that "the factual findings being assailed
are not supported by evidence on record or the impugned judgment is based
on a misapprehension of facts." Its very own letter-offer of employment
argues against its above posture. Excerpts of the letter-offer:
Additionally, upon the effectivity of your probation, you and your immediate
superior are required to jointly define your objectives compared with the job
requirements of the position. Based on the pre-agreed objectives, your
performance shall be reviewed on the 3rd month to assess your competence
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and work attitude. The 5th month Performance Appraisal shall be the basis in
elevating or confirming your employment status from Probationary to
Regular.
Failure to meet the job requirements during the probation stage means that
your services may be terminated without prior notice and without recourse
to separation pay. (Emphasis supplied.)
Respondents further allege that San Mateos email dated July 16, 2004 shows
that the standards for his regularization were made known to petitioner
Aliling at the time of his engagement. To recall, in that email message, San
Mateo reminded Aliling of the sales quota he ought to meet as a condition for
his continued employment, i.e., that the GX trucks should already be 80%
full by August 5, 2004. Contrary to respondents contention, San Mateos
email cannot support their allegation on Aliling being informed of the
standards for his continued employment, such as the sales quota, at the time
of his engagement. As it were, the email message was sent to Aliling more
than a month after he signed his employment contract with WWWEC. The
aforequoted Section 6 of the Implementing Rules of Book VI, Rule VIII-A of the
Code specifically requires the employer to inform the probationary employee
of such reasonable standards at the time of his engagement, not at any time
later; else, the latter shall be considered a regular employee. Thus, pursuant
to the explicit provision of Article 281 of the Labor Code, Section 6(d) of the
Implementing Rules of Book VI, Rule VIII-A of the Labor Code and settled
jurisprudence, petitioner Aliling is deemed a regular employee as of June 11,
2004, the date of his employment contract.
Petitioner was illegally dismissed
To justify fully the dismissal of an employee, the employer must, as a rule,
prove that the dismissal was for a just cause and that the employee was
afforded due process prior to dismissal. As a complementary principle, the
employer has the onus of proving with clear, accurate, consistent, and
convincing evidence the validity of the dismissal.34
WWWEC had failed to discharge its twin burden in the instant case.
First off, the attendant circumstances in the instant case aptly show that the
issue of petitioners alleged failure to achieve his quota, as a ground for
terminating employment, strikes the Court as a mere afterthought on the
part of WWWEC. Consider: Lariosas letter of September 25, 2004 already
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We cannot but agree with PEPSI that "gross inefficiency" falls within the
purview of "other causes analogous to the foregoing," this constitutes,
therefore, just cause to terminate an employee under Article 282 of the
Labor Code. One is analogous to another if it is susceptible of comparison
with the latter either in general or in some specific detail; or has a close
relationship with the latter. "Gross inefficiency" is closely related to "gross
neglect," for both involve specific acts of omission on the part of the
employee resulting in damage to the employer or to his business. In Buiser
vs. Leogardo, this Court ruled that failure to observed prescribed standards
to inefficiency may constitute just cause for dismissal. (Emphasis supplied.)
It did so anew in Leonardo v. National Labor Relations Commission36 on the
following rationale:
An employer is entitled to impose productivity standards for its workers, and
in fact, non-compliance may be visited with a penalty even more severe than
demotion. Thus,
[t]he practice of a company in laying off workers because they failed to make
the work quota has been recognized in this jurisdiction. (Philippine American
Embroideries vs. Embroidery and Garment Workers, 26 SCRA 634, 639). In
the case at bar, the petitioners' failure to meet the sales quota assigned to
each of them constitute a just cause of their dismissal, regardless of the
permanent or probationary status of their employment. Failure to observe
prescribed standards of work, or to fulfill reasonable work assignments due
to inefficiency may constitute just cause for dismissal. Such inefficiency is
understood to mean failure to attain work goals or work quotas, either by
failing to complete the same within the allotted reasonable period, or by
producing unsatisfactory results. This management prerogative of requiring
standards may be availed of so long as they are exercised in good faith for
the advancement of the employer's interest. (Emphasis supplied.)
In fine, an employees failure to meet sales or work quotas falls under the
concept of gross inefficiency, which in turn is analogous to gross neglect of
duty that is a just cause for dismissal under Article 282 of the Code.
However, in order for the quota imposed to be considered a valid
productivity standard and thereby validate a dismissal, managements
prerogative of fixing the quota must be exercised in good faith for the
advancement of its interest. The duty to prove good faith, however, rests
with WWWEC as part of its burden to show that the dismissal was for a just
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cause. WWWEC must show that such quota was imposed in good faith. This
WWWEC failed to do, perceptibly because it could not. The fact of the matter
is that the alleged imposition of the quota was a desperate attempt to lend a
semblance of validity to Alilings illegal dismissal. It must be stressed that
even WWWECs sales manager, Eve Amador (Amador), in an internal e-mail
to San Mateo, hedged on whether petitioner performed below or above
expectation:
Could not quantify level of performance as he as was tasked to handle a new
product (GX). Revenue report is not yet administered by IT on a month-tomonth basis. Moreover, this in a way is an experimental activity. Practically
you have a close monitoring with Armand with regards to his performance.
Your assessment of him would be more accurate.
Being an experimental activity and having been launched for the first time,
the sales of GX services could not be reasonably quantified. This would
explain why Amador implied in her email that other bases besides sales
figures will be used to determine Alilings performance. And yet, despite such
a neutral observation, Aliling was still dismissed for his dismal sales of GX
services. In any event, WWWEC failed to demonstrate the reasonableness
and the bona fides on the quota imposition.
Employees must be reminded that while probationary employees do not
enjoy permanent status, they enjoy the constitutional protection of security
of tenure. They can only be terminated for cause or when they otherwise fail
to meet the reasonable standards made known to them by the employer at
the time of their engagement.37Respondent WWWEC miserably failed to
prove the termination of petitioner was for a just cause nor was there
substantial evidence to demonstrate the standards were made known to the
latter at the time of his engagement. Hence, petitioners right to security of
tenure was breached.
Alilings right to procedural due process was violated
As earlier stated, to effect a legal dismissal, the employer must show not
only a valid ground therefor, but also that procedural due process has
properly been observed. When the Labor Code speaks of procedural due
process, the reference is usually to the two (2)-written notice rule envisaged
in Section 2 (III), Rule XXIII, Book V of the Omnibus Rules Implementing the
Labor Code, which provides:
Elsa M. Caete|33 | P a g e
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Clearly, the law intends the award of backwages and similar benefits to
accumulate past the date of the Labor Arbiters decision until the dismissed
employee is actually reinstated. But if, as in this case, reinstatement is no
longer possible, this Court has consistently ruled that backwages shall be
computed from the time of illegal dismissal until the date the decision
becomes final. (Emphasis supplied.)
Additionally, Aliling is entitled to separation pay in lieu of reinstatement on
the ground of strained relationship.
In Golden Ace Builders v. Talde,41 the Court ruled:
The basis for the payment of backwages is different from that for the award
of separation pay.1wphi1 Separation pay is granted where reinstatement is
no longer advisable because of strained relations between the employee and
the employer. Backwages represent compensation that should have been
earned but were not collected because of the unjust dismissal. The basis for
computing backwages is usually the length of the employee's service while
that for separation pay is the actual period when the employee was
unlawfully prevented from working.
As to how both awards should be computed, Macasero v. Southern Industrial
Gases Philippines instructs:
[T]he award of separation pay is inconsistent with a finding that there was no
illegal dismissal, for under Article 279 of the Labor Code and as held in a
catena of cases, an employee who is dismissed without just cause and
without due process is entitled to backwages and reinstatement or payment
of separation pay in lieu thereof:
Thus, an illegally dismissed employee is entitled to two reliefs: backwages
and reinstatement. The two reliefs provided are separate and distinct. In
instances where reinstatement is no longer feasible because of strained
relations between the employee and the employer, separation pay is
granted. In effect, an illegally dismissed employee is entitled to either
reinstatement, if viable, or separation pay if reinstatement is no longer
viable, and backwages.
The normal consequences of respondents illegal dismissal, then, are
reinstatement without loss of seniority rights, and payment of backwages
computed from the time compensation was withheld up to the date of actual
Elsa M. Caete|37 | P a g e
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Elsa M. Caete|38 | P a g e
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In alleging that WWWEC acted in bad faith, Aliling has the burden of proof to
present evidence in support of his claim, as ruled in Culili v. Eastern
Telecommunications Philippines, Inc.:46
According to jurisprudence, "basic is the principle that good faith is
presumed and he who alleges bad faith has the duty to prove the same." By
imputing bad faith to the actuations of ETPI, Culili has the burden of proof to
present substantial evidence to support the allegation of unfair labor
practice. Culili failed to discharge this burden and his bare allegations
deserve no credit.
This was reiterated in United Claimants Association of NEA (UNICAN) v.
National Electrification Administration (NEA),47 in this wise:
It must be noted that the burden of proving bad faith rests on the one
alleging it. As the Court ruled in Culili v. Eastern Telecommunications, Inc.,
"According to jurisprudence, basic is the principle that good faith is
presumed and he who alleges bad faith has the duty to prove the same."
Moreover, in Spouses Palada v. Solidbank Corporation, the Court stated,
"Allegations of bad faith and fraud must be proved by clear and convincing
evidence."
Similarly, Aliling has failed to overcome such burden to prove bad faith on
the part of WWWEC. Aliling has not presented any clear and convincing
evidence to show bad faith. The fact that he was illegally dismissed is
insufficient to prove bad faith. Thus, the CA correctly ruled that "[t]here was
no sufficient showing of bad faith or abuse of management prerogatives in
the personal action taken against petitioner."48 In Lambert Pawnbrokers and
Jewelry Corporation v. Binamira,49 the Court ruled:
A dismissal may be contrary to law but by itself alone, it does not establish
bad faith to entitle the dismissed employee to moral damages. The award of
moral and exemplary damages cannot be justified solely upon the premise
that the employer dismissed his employee without authorized cause and due
process.
The officers of WWWEC cannot be held
jointly and severally liable with the company
The CA held the president of WWWEC, Jose B. Feliciano, San Mateo and
Lariosa jointly and severally liable for the monetary awards of Aliling on the
Elsa M. Caete|40 | P a g e
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ground that the officers are considered "employers" acting in the interest of
the corporation. The CA cited NYK International Knitwear Corporation
Philippines (NYK) v. National Labor Relations Commission50 in support of its
argument. Notably, NYK in turn cited A.C. Ransom Labor Union-CCLU v.
NLRC.51
Such ruling has been reversed by the Court in Alba v. Yupangco,52 where the
Court ruled:
By Order of September 5, 2007, the Labor Arbiter denied respondents
motion to quash the 3rd alias writ. Brushing aside respondents contention
that his liability is merely joint, the Labor Arbiter ruled:
Such issue regarding the personal liability of the officers of a corporation for
the payment of wages and money claims to its employees, as in the instant
case, has long been resolved by the Supreme Court in a long list of cases
[A.C. Ransom Labor Union-CLU vs. NLRC (142 SCRA 269) and reiterated in the
cases of Chua vs. NLRC (182 SCRA 353), Gudez vs. NLRC (183 SCRA 644)]. In
the aforementioned cases, the Supreme Court has expressly held that the
irresponsible officer of the corporation (e.g. President) is liable for the
corporations obligations to its workers. Thus, respondent Yupangco, being
the president of the respondent YL Land and Ultra Motors Corp., is properly
jointly and severally liable with the defendant corporations for the labor
claims of Complainants Alba and De Guzman. x x x
xxxx
As reflected above, the Labor Arbiter held that respondents liability is
solidary.
There is solidary liability when the obligation expressly so states, when the
law so provides, or when the nature of the obligation so requires. MAM Realty
Development Corporation v. NLRC, on solidary liability of corporate officers in
labor disputes, enlightens:
x x x A corporation being a juridical entity, may act only through its directors,
officers and employees. Obligations incurred by them, acting as such
corporate agents are not theirs but the direct accountabilities of the
corporation they represent. True solidary liabilities may at times be incurred
but only when exceptional circumstances warrant such as, generally, in the
following cases:
Elsa M. Caete|41 | P a g e
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Elsa M. Caete|42 | P a g e
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Elsa M. Caete|43 | P a g e
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position papers and evidence within ten (10) days from receipt of said
order (Annex "4", Comment, pp. 610-611, ibid.). On November 28,
1997, a second order was issued reiterating the previous directive to
all striking employees to return to work immediately.
On November 27, 1997, the union filed a Motion for Reconsideration
assailing, among others, the authority of then Acting Secretary Trajano
to assume jurisdiction over the labor dispute. Said motion was denied
in an Order dated January 7, 1998.
As directed, the parties submitted their respective position papers. In
its position paper, the union raised the issue of the alleged unfair labor
practice of the company hereunder enumerated as follows:
"(a) PABX transfer and contractualization of PABX service and
position;
"(b) Massive contractualization;
"(c) Flexible labor and additional work/function;
"(d) Disallowance of union leave intended for union seminar;
"(e) Misimplementation and/or non-implementation of
employees' benefits like shoe allowance, rainboots, raincoats,
OIC shift allowance, P450.00 monthly allowance, driving
allowance, motorcycle award and full-time physician;
"(f) Non-payment, discrimination and/or deprivation of overtime,
restday work, waiting/stand by time and staff meetings;
"(g) Economic inducement by promotion during CBA negotiation;
"(h) Disinformation scheme, surveillance and interference with
union affairs;
"(i) Issuance of memorandum/notice to employees without giving
copy to union, change in work schedule at Traffic Records Section
and ITTO policies; and
"(j) Inadequate transportation allowance, water and facilities."
Elsa M. Caete|46 | P a g e
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this Office finds it proper to defer deciding on the matter and first allow
the Company to submit its position thereon.
We now come to the question of whether or not the strike staged by
the Union on November 17, 1997 is illegal. The Company claims it is,
having been held on grounds which are non-strikeable, during the
pendency of preventive mediation proceedings in the NCMB, after this
Office has assumed jurisdiction over the dispute, and with the strikers
committing prohibited and illegal acts. The Company further prays for
the termination of some 20 Union officers who were positively
identified to have initiated the alleged illegal strike. The Union, on the
other hand, refuses to submit this issue for resolution.
Considering the precipitous nature of the sanctions sought by the
Company, i.e., declaration of illegality of the strike and the
corresponding termination of the errant Union officers, this Office
deems it wise to defer the summary resolution of the same until both
parties have been afforded due process. The non-compliance of the
strikers with the return-to-work orders, while it may warrant dismissal,
is not by itself conclusive to hold the strikers liable. Moreover, the
Union's position on the alleged commission of illegal acts by the
strikers during the strike is still to be heard. Only after a full-blown
hearing may the respective liabilities of Union officers and members be
determined. The case of Telefunken Semiconductors Employees UnionFFW v. Secretary of Labor and Employment and Temic Telefunken
Micro-Electronics (Phils.), Inc. (G.R. No. 122743 and 127215, December
12, 1997) is instructive on this point:
It may be true that the workers struck after the Secretary of
Labor and Employment had assumed jurisdiction over the case
and that they may have failed to immediately return to work
even after the issuance of a return-to-work order, making their
continued strike illegal. For, a return-to-work order is
immediately effective and executory notwithstanding the filing of
a motion for reconsideration. But, the liability of each of the
union officers and the workers, if any, has yet to be determined.
xxx xxx xxx.4
The dispositive portion of the Order reads:
Elsa M. Caete|49 | P a g e
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For its part, Philcom Employees Union (PEU) filed a Motion for Partial
Reconsideration. PEU asked the Secretary to "partially reconsider" the 2
October 1998 Order insofar as it dismissed the unfair labor practices charges
against Philcom and included the illegal strike issue in the labor dispute.8
The Secretary denied both motions for reconsideration of Philcom and PEU in
its assailed Order of 27 November 1998. The pertinent parts of the Order
read:
The question of whether or not Philcom Corporation should be
impleaded has been properly disposed of in the assailed Order. We
reiterate that neither the Company herein nor its predecessor was able
to convincingly establish that each is a separate entity in the absence
of any proof that there was indeed an actual closure and cessation of
the operations of the predecessor-company. We would have
accommodated the Company for a hearing on the matter had it been
willing and prepared to submit evidence to controvert the finding that
there was a mere merger. As it now stands, nothing on record would
prove that the two (2) companies are separate and distinct from each
other.
Having established that what took place was a mere merger, we
correspondingly conclude that the employer-employee relations
between the Company and the Union officers and members was never
severed. And in merger, the employees of the merged companies or
entities are deemed absorbed by the new company (Filipinas Port
Services, Inc. v. NLRC, et. al., G.R. No. 97237, August 16, 1991).
Considering that the Company failed miserably to adduce any evidence
to provide a basis for a contrary ruling, allegations to the effect that
employer-employee relations and positions previously occupied by the
workers no longer exist remain just that mere allegations.
Consequently, the Company cannot now exempt itself from compliance
with the Order. Neither can it successfully argue that the employees
were validly dismissed. As held in Telefunken Semiconductor
Employees Union-FFW v. Secretary of Labor and Employment (G.R.
Nos. 122743 and 122715, December 12, 1997), to exclude the workers
without first ascertaining the extent of their individual participation in
the strike or non-compliance with the return-to-work orders will be
tantamount to dismissal without due process of law.
Elsa M. Caete|51 | P a g e
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With respect to the unfair labor practice charges against the Company,
we have carefully reviewed the records and found no reason to depart
from the findings previously rendered. The issues now being raised by
the Union are the same issues discussed and passed upon in our
earlier Order.
Finally, it is our determination that the issue of the legality of the strike
is well within the jurisdiction of this Office. The same has been properly
submitted and assumed jurisdiction by the Office for resolution.9
The dispositive portion of the Order reads:
WHEREFORE, there being no merit in the remaining Motions for
Reconsideration filed by both parties, the same are hereby DENIED.
Our 2 October 1998 Order STANDS. To expedite the resolution of the
Motion to Certify Labor Dispute to the NLRC for Compulsory Arbitration,
Philcom Employees Union is hereby directed to submit its Opposition
thereto within ten (10) days from receipt of the copy of this Order.
SO ORDERED.10
PEU filed with this Court a petition for certiorari and prohibition under Rule 65
of the Rules of Court assailing the Secretary's Orders of 2 October 1998 and
27 November 1998. This Court, in accordance with its Decision of 10 March
1999 in G.R. No. 123426 entitled National Federation of Labor (NFL) vs. Hon.
Bienvenido E. Laguesma, Undersecretary of the Department of Labor and
Employment, and Alliance of Nationalist Genuine Labor Organization,
Kilusang Mayo Uno (ANGLO-KMU),11 referred the case to the Court of
Appeals.12
The Ruling of the Court of Appeals
On 31 July 2000, the Court of Appeals rendered judgment as follows:
WHEREFORE, PREMISES CONSIDERED, this petition is hereby DENIED.
The assailed portions of the Orders of the Secretary of Labor and
Employment dated October 2, 1998 and November 27, 1998 are
AFFIRMED.
SO ORDERED.13
Elsa M. Caete|52 | P a g e
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The Court of Appeals ruled that, contrary to PEU's view, the Secretary could
take cognizance of an issue, even only incidental to the labor dispute,
provided the issue must be involved in the labor dispute itself or otherwise
submitted to him for resolution.
The Court of Appeals pointed out that the Secretary assumed jurisdiction
over the labor dispute upon Philcom's petition as a consequence of the strike
that PEU had declared and not because of the notices of strike that PEU filed
with the National Conciliation and Mediation Board (NCMB).
The Court of Appeals stated that the reason of the Secretary's assumption of
jurisdiction over the labor dispute was the staging of the strike.
Consequently, any issue regarding the strike is not merely incidental to the
labor dispute between PEU and Philcom, but also part of the labor dispute
itself. Thus, the Court of Appeals held that it was proper for the Secretary to
take cognizance of the issue on the legality of the strike.
The Court of Appeals also ruled that for an employee to claim an unfair labor
practice by the employer, the employee must show that the act charged as
unfair labor practice falls under Article 248 of the Labor Code. The Court of
Appeals held that the acts enumerated in Article 248 relate to the workers'
right to self-organization. The Court of Appeals stated that if the act
complained of has nothing to do with the acts enumerated in Article 248,
there is no unfair labor practice.
The Court of Appeals held that Philcom's acts, which PEU complained of as
unfair labor practices, were not in any way related to the workers' right to
self-organization under Article 248 of the Labor Code. The Court of Appeals
held that PEU's complaint constitutes an enumeration of mere grievances
which should have been threshed out through the grievance machinery or
voluntary arbitration outlined in the Collective Bargaining Agreement (CBA).
The Court of Appeals also held that even if by Philcom's acts, Philcom had
violated the provisions of the CBA, still those acts do not constitute unfair
labor practices under Article 248 of the Labor Code. The Court of Appeals
held that PEU failed to show that those violations were gross or that there
was flagrant or malicious refusal on the part of Philcom to comply with the
economic provisions of the CBA.
The Court of Appeals stated that as of 21 March 1989, as held in PAL vs.
NLRC,14 violations of CBAs will no longer be deemed unfair labor practices,
Elsa M. Caete|53 | P a g e
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x x x x.
The powers granted to the Secretary under Article 263(g) of the Labor Code
have been characterized as an exercise of the police power of the State, with
the aim of promoting public good.16 When the Secretary exercises these
powers, he is granted "great breadth of discretion" in order to find a
solution to a labor dispute. The most obvious of these powers is the
automatic enjoining of an impending strike or lockout or its lifting if one has
already taken place.17
In this case, the Secretary assumed jurisdiction over the dispute because it
falls in an industry indispensable to the national interest. As noted by the
Secretary.
[T]he Company has been a vital part of the telecommunications
industry for 73 years. It is particularly noted for its expertise and
dominance in the area of international telecommunications. Thus, it
performs a vital role in providing critical services indispensable to the
national interest. It is for this very reason that this Office strongly
opines that any concerted action, particularly a prolonged work
stoppage is fraught with dire consequences. Surely, the on-going strike
will adversely affect not only the livelihood of workers and their
dependents, but also the company's suppliers and dealers, both in the
public and private sectors who depend on the company's facilities in
the day-to-day operations of their businesses and commercial
transactions. The operational viability of the company is likewise
adversely affected, especially its expansion program for which it has
incurred debts in the approximate amount of P2 Billion. Any prolonged
work stoppage will also bring about substantial losses in terms of lost
tax revenue for the government and would surely pose a serious set
back in the company's modernization program.
At this critical time when government is working to sustain the
economic gains already achieved, it is the paramount concern of this
Office to avert any unnecessary work stoppage and, if one has already
occurred, to minimize its deleterious effect on the workers, the
company, the industry and national economy as a whole.18
It is of no moment that PEU never acquiesced to the submission for
resolution of the issue on the legality of the strike. PEU cannot prevent
resolution of the legality of the strike by merely refusing to submit the issue
Elsa M. Caete|56 | P a g e
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for resolution. It is also immaterial that this issue, as PEU asserts, was not
properly submitted for resolution of the Secretary.
The authority of the Secretary to assume jurisdiction over a labor dispute
causing or likely to cause a strike or lockout in an industry indispensable to
national interest includes and extends to all questions and
controversies arising from such labor dispute. The power is plenary
and discretionary in nature to enable him to effectively and
efficiently dispose of the dispute.19
Besides, it was upon Philcom's petition that the Secretary immediately
assumed jurisdiction over the labor dispute on 19 November 1997.20 If
petitioner's notices of strike filed on 21 October and 4 November 1997 were
what prompted the assumption of jurisdiction, the Secretary would have
issued the assumption order as early as those dates.
Moreover, after an examination of the position paper21 Philcom submitted to
the Secretary, we see no reason to strike out those portions which PEU seek
to expunge from the records. A careful study of all the facts alleged, issues
raised, and arguments presented in the position paper leads us to hold that
the portions PEU seek to expunge are necessary in the resolution of the
present case.
On the documents attached to Philcom's position paper, except for Annexes
MM-2 to MM-22 inclusive22 which deal with the supposed consolidation of
Philippine Global Communications, Inc. and Philcom Corporation, we find the
other annexes relevant and material in the resolution of the issues that have
emerged in this case.
PEU also claims that Philcom has committed several unfair labor practices.
PEU asserts that there are "factual and evidentiary bases" for the charge of
unfair labor practices against Philcom.
On unfair labor practices of employers, Article 248 of the Labor Code
provides:
Unfair labor practices of employers. - It shall be unlawful for an
employer to commit any of the following unfair labor practice:
(a) To interfere with, restrain or coerce employees in the exercise of
their right to self-organization;
Elsa M. Caete|57 | P a g e
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Article 264(a) of the Labor Code. The union officers who knowingly
participate in the illegal strike are deemed to have lost their employment
status. The union members, including union officers, who commit specific
illegal acts or who knowingly defy a return-to-work order are also deemed to
have lost their employment status.37 Otherwise, the workers will simply
refuse to return to their work and cause a standstill in the company
operations while retaining the positions they refuse to discharge and
preventing management to fill up their positions.38
Hence, the failure of PEU's officers and members to comply immediately with
the return-to-work orders dated 19 November and 28 November 1997 cannot
be condoned. Defiance of the return-to-work orders of the Secretary
constitutes a valid ground for dismissal.39
3. PEU staged the strike using unlawful means and methods.
Even if the strike in the present case was not illegal per se, the strike
activities that PEU had undertaken, especially the establishment of human
barricades at all entrances to and egresses from the company premises and
the use of coercive methods to prevent company officials and other
personnel from leaving the company premises, were definitely illegal.40 PEU
is deemed to have admitted that its officers and members had committed
these illegal acts, as it never disputed Philcom's assertions of PEU's unlawful
strike activities in all the pleadings that PEU submitted to the Secretary and
to this Court.
PEU's picketing officers and members prohibited other tenants at the Philcom
building from entering and leaving the premises. Leonida S. Rabe, Country
Manager of Societe Internationale De Telecommunications
Aeronautiques (SITA), a tenant at the Philcom building, wrote two letters
addressed to PEU President Roberto B. Benosa. She told Benosa that PEU's
act of obstructing the free ingress to and egress from the company premises
"has badly disrupted normal operations of their organization."41
The right to strike, while constitutionally recognized, is not without legal
constrictions. Article 264(e) of the Labor Code, on prohibited activities,
provides:
No person engaged in picketing shall commit any act of violence,
coercion or intimidation or obstruct the free ingress to or egress from
Elsa M. Caete|67 | P a g e
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Elsa M. Caete|68 | P a g e
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February 9, 1967
Court,4 issued ex parte the writ of preliminary injunction prayed for. The
Union moved to reconsider. Ground, inter alia, is that the court of first
instance had no jurisdiction over the subject-matter unfair labor practice.
It was the turn of the other respondent, Judge Jose C. Borromeo, to refuse
reconsideration.
Meanwhile, on March 5, 1966 on the same day the Court of First Instance
complaint was filed by Sugeco against the Union the latter lodged with the
Court of Industrial Relations (CIR, for short) a charge for unfair labor practice
against Sugeco, its general manager, Concepelon Y. Lua, and its two
supervisors, Nestor Yu and Mariano Nulla. The Union there averred that said
respondents coerced and exerted pressure upon the union members to
resign, as they did resign, from the Union; and that such resignations were
seized upon by Sugeco to refuse further negotiations with the Union.
Offshoot is the complaint for unfair labor practice registered in the CIR on
April 29, 1966 by its Acting Prosecutor.5
On May 9, 1966, the Union came to this Court on certiorari and prohibition.
The Union here prays that respondent judges of the Court of First Instance of
Cebu be declared without jurisdiction over the subject matter of the petition
in Civil Case No. R-9221 aforesaid; that the writ of preliminary injunction
therein issued be annulled; and that said judges be directed to dismiss said
case. The Union also asks that pendente lite the respondent judges be
stopped from further proceeding with the case just adverted to.
This Court on May 16, 1966, issued the solicited cease-and-desist
order.1wph1.t
The quintessence of this case is jurisdiction.
First, we go to the background facts. We take stock of Sugeco's petition
against the Union in the Court of First Instance of Cebu (Case No. R-9221).
Read as it should be, Sugeco in paragraph 10 thereof charges the Union with
"coercing the resigned employees to rejoin" the same. And this, obviously to
neutralize the Union claim that Sugeco was coercing and cajoling its
members to separate therefrom.6
This charge and countercharge require us to focus attention on the Industrial
Peace Act.7 Section 4(a) and (b) thereof recite, as follows:
(a) It shall be unfair labor practice for an employer:
(1) To interfere with, restrain or coerce employees in the exercise of
their rights guaranteed in section three;
xxx
xxx
xxx
Elsa M. Caete|72 | P a g e
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the ULP case was not calculated merely to divest the Cebu court of first
instance of jurisdiction which it did not possess.11
A rule buttressed upon statute and reason that frequently reiterated in
jurisprudence is that labor cases involving unfair labor practice are within
the exclusive jurisdiction of the ClR. By now, this rule has ripened into
dogma. It thus commands adherence not breach.12 This Court once pointedly
remarked that "[t]he policy of social justice guaranteed by the Constitution
demands that when cases appear to involve labor disputes courts should
take care in the exercise of their prerogatives and discretion".13
The Court of First Instance of Cebu, we rule, is without jurisdiction over the
subject-matter of Case No. R-9221. Its judges, therefore, did not have the
authority to provide for an ancillary remedy in that case. Hence, the
injunction below complained of was issued coram non judice. It is void.
For the reasons given:
(1) the petition herein for a writ of certiorari and prohibition is hereby
granted, and the writ of preliminary injunction we issued on May 13, 1966 is
declared permanent;
(2) the writ of preliminary injunction issued by the Court of First Instance of
Cebu in Case No. L-9221, entitled "Superior Gas and Equipment Co. of Cebu,
Inc., petitioner, vs. Associated Labor Union, respondent" is hereby declared
null and void; and
(3) the respondent judges, or whoever shall take their place, are hereby
directed to dismiss the said Case No. L-9221.
Costs against respondent Superior Gas and Equipment Co. of Cebu, Inc. So
ordered.
Elsa M. Caete|74 | P a g e
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FIRST DIVISION
Petitioner,
Present:
- versus -
CORONA, C.J.,
Chairperson,
VELASCO, JR.,
LEONARDO-DE CASTRO,
DEL CASTILLO, and
PEREZ, JJ.
ADD
FORCE
PERSONNEL
SERVICES,
INC. and COURT
OF APPEALS,
Promulgated:
Respondents.
July 6, 2010
x- - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - - -x
Elsa M. Caete|75 | P a g e
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DECISION
PEREZ, J.:
Elsa M. Caete|76 | P a g e
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xxxx
From:
Approved by:
JACQUES A. DUPASQUIER
Chairman
Petitioner denied that she was negligent and proffered that she faithfully and
painstakingly performed her duties as sales manager. She faulted Longstaff
for his indecisiveness and the lack of support personnel and staff for the
sales department.[7]
Elsa M. Caete|78 | P a g e
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1)
Respondent company ADD Force Personnel
Services, Inc. to pay her full backwages from date illegally
dismissed on 6/23/04 until actual payment and/or finality of this
decision, which as of date amounts to basic P1,311,360.00
(P68,300.00 x 19.2 months), 13 th month pay of P109,280.00, and
the combined amounts of her leaves (VL & SL) of P107,913.68
(30 days/year x P2,276.66/day x 1.58 years);
2)
Respondent company ADD Force Personnel
Services, Inc., in lieu of complainants reinstatement, to pay her
separation pay of one (1) month per year of service/putative
service reckoned from 09/15/03 until finality of this decision or
actual payment which as of date, amounts to P136,600.00
(P68,300.00 x 2 years);
3)
Respondents ADD Force Personnel Services, Inc.,
JACQUES A. DUPASQUIER (Chairman), COLWYN RON C.
LONGSTAFF (CEO), ATTY. CRISTINA SAMSON (Corporate Counsel),
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of
P200,000.00
and
4)
Respondent ADD Force Personnel Services, Inc. to
pay her proportionate 13th month pay (Jan. to 02/23/04), last
months salary (February, 01-23, 2003) and reimbursements
P2,000.00;
5)
Respondent ADD Force Personnel Services, Inc. to
pay her 10% of the total award as attorneys fees.[10]
The labor arbiter found that petitioner was illegally suspended without
basis. The charges of gross and habitual neglect of duties, as well as the loss
of trust and confidence were not substantiated.Thus, the labor arbiter
concluded that petitioner was constructively dismissed by respondent.[11]
On 27 July 2007, the Court of Appeals, to which the case was elevated,
enjoined the execution of the NLRC decision and subsequently reversed its
decision, as well as that of the labor arbiters.
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The Court of Appeals ruled that petitioner was not constructively dismissed
but that the latter chose to resign from her job. Petitioners bare allegation
that she was coerced into resigning was not given credence by the appellate
court. With respect to the allegation of illegal suspension, the Court of
Appeals upheld the exercise by respondent of its management prerogative in
suspending petitioner pending investigation for a perceived violation of
company rules.
Elsa M. Caete|81 | P a g e
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that said suspension in fact has a duration which could very well be not more
than 30 days as mandated by law. And, as the Court of Appeals correctly
observed, the suspension has been rendered moot by petitioners resignation
tendered a day after the suspension was made effective.
Petitioner claims that Longstaff forced her to resign by baiting her with
the promise of separation pay;[24] but respondent maintains that there was
nothing illegal in giving petitioner the option to either resign or be separated
for a just cause.[25]
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that the person from whom it comes has the necessary means or ability to
inflict the threatened injury to his person or property.[27]
SO ORDERED.
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She nevertheless called petitioner at the end of the month, but was informed
that she had no more job to do.
Immediately thereafter, on 3 June 2002, respondent filed a Complaint for
illegal dismissal and prayed for reinstatement and back wages before the LA.
Later on, she amended her Complaint by asking for separation pay instead of
reinstatement.
In her Position Paper,6 Oco maintained that petitioner verbally dismissed her
without any valid cause and without due process. To bolster her story,
respondent adduced that Tegimenta hired new employees to replace her. In
their defense, petitioners countered that she had abandoned her job by
being continuously absent without official leave (AWOL). They further
narrated that they could not possibly terminate her services, because she
still had to settle her accountabilities.7
The LA disbelieved the narration of petitioners and thus ruled in favor of
respondent. The arbiter deduced that the employer only wanted to "make it
appear that the complainant was not dismissed from employment, as she
could not prove it with any Memorandum issued to that effect and yet, they
also maintain that complainant was AWOL."8The LA further observed that
petitioners did not deny the main claim of respondent that she had simply
been told not to report for work anymore.
Aggrieved, petitioners appealed to the NLRC. They assailed the ruling of the
LA for having been issued based not on solid proof, but on mere allegations
of the employee.9 They advanced further that Oco had abandoned her
employment, given that she claimed separation pay instead of
reinstatement.
The NLRC reviewed the records of the case and found that the documentary
evidence coincided with the allegations of Oco.10
Consequently, it affirmed her claim that Garcia, without advancing any
reason and without giving any written notice, had categorically told her not
to work for Tegimenta anymore. Accordingly, the NLRC sustained the
illegality of respondents dismissal.11
On Motion for Reconsideration, the NLRC still affirmed the LAs Decision in
toto.12 Thus, petitioners pursued their action before the CA via a Rule 65
Petition.
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A deeper study of the records show that Tegimenta failed to adduce proof of
any overt act of Oco that clearly and unequivocably showed her
intention to abandoned her work when she allegedly absented herself
without leave. The absences incurred by Oco do not indicate that she already
abandoned her work, especially considering that Oco reported for
work after the agreed dates of her vacation leave, and she
subsequently filed an illegal dismissal case against Tegimenta. (Emphasis
supplied).
Secondly, the CA rejected the payroll sheets as proof that Oco was on AWOL.
It held that the companys marginal notes reflecting that she was "on leave"
had no supporting attachments. It even construed the notations as
incompetent evidence because, despite her absence, the payroll sheets for
July 2002 onwards had no notations at all that she was "on leave."16
Thirdly, the CA dismissed petitioners argument that Oco had effectively
abandoned her work and waived her claim for back wages when she
changed her prayer from reinstatement to separation pay. The appellate
court simply explained that opting for separation pay, in lieu of
reinstatement, could not support the allegation that Oco abandoned her
work; and that the relief for separation pay did not preclude the grant of
back ages, as these two awards were twin remedies available to an illegally
dismissed employee.
Completely dissatisfied with the reversal of their fortune, petitioners implore
this Court (1) to discredit the allegation of Oco that she had in fact been
dismissed by them and (2) to make a finding that she abandoned her work
by being on AWOL.
RULING OF THE COURT
The Factual Determination of the Employees Dismissal
Prefatorily, the inquiry into whether Garcia verbally fired Oco and whether
the employee abandoned her job are factual determinations generally
beyond the jurisdiction of this Court;17 and in addition to the weakness of
petitioners case, all the courts below consistently affirmed the certainty of
the employees dismissal by the employer.18
An established doctrine in labor cases is that factual questions are for labor
tribunals to resolve. Their consistent findings are binding and conclusive and
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is such as naturally to call for action or comment if not true, and when proper
and possible for him to do so, may be given in evidence against him.
Considering this rule of evidence, together with the immaterial
discrepancies, this Court thus rules against wholly invalidating the findings of
the courts a quo.
The Employers Defense of Absence without Official Leave
After unsuccessfully assailing the narration of the employee, petitioners
argue that Oco abandoned her job by being on AWOL. As bases for this
affirmative defense, they highlight her previous instances of absence and
tardiness. Then, they emphasize the marginal notes in the 16 to 30 Jun 2002
payroll, which showed that she was on leave. Finally, they equate the
employees act of asking for separation pay instead of reinstatement as an
act of abandonment.
The bases cited by petitioners are bereft of merit.
First, the nonappearance of Oco at work was already accepted by the
company as having resulted from complications in her pregnancy. In fact,
Garcia herself offered respondent a vacation leave. Therefore, given that the
absences of the latter were grounded on justifiable reasons, these absences
cannot serve as the antecedent to the conclusion that she had already
abandoned her job. 24
For abandonment to exist, two factors must be present: (1) the failure to
report for work or absence without a valid or justifiable reason; and (2) a
clear intention to sever the employer-employee relationship, with the second
element as the more determinative factor being manifested by some overt
acts.25
The mere absence of an employee is not sufficient to constitute
abandonment.26 As an employer, Tegimenta has the burden of proof to show
the deliberate and unjustified refusal of the employee to resume the latters
employment without any intention of returning.27
Here, Tegimenta failed to discharge its burden of proving that Oco desired to
leave her job. The courts a quouniformly found that she had continuously
reported for work right after her vacation, and that her office attendance was
simply cut off when she was categorically told not to report anymore. These
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courts even noted that she had also called up the office to follow up her
status; and when informed of her definite termination, she lost no time in
filing a case for illegal dismissal. Evidently, her actions did not constitute
abandonment and instead implied her continued interest to stay employed.
Second, the marginal notes in the 16 to 30 June 2002 payroll showing that
she was on leave are dubious. For one, the CA dutifully detected that none of
the succeeding payroll sheets indicated that Oco was considered by the
company as merely AWOL. Hence, it becomes questionable whether there is
regularity in making simple notations as Tegimentas reference in considering
the status of an employee. Therefore, we hold that the marginal notations in
a single payroll sheet are not competent proofs to back up petitioners main
defense.
This Court also rejects the invocation by petitioners of the bestevidence
rule.1wphi1 According to them, the payroll sheet, and not the mere
allegation of Oco, is the best evidence that they did not terminate her.
However, petitioners seem to miss the whole import of the bestevidence
rule. This rule is used to compel the production of the original document, if
the subject of the inquiry is the content of the document itself.28 The rule
provides that the court shall not receive any evidence that is merely
substitutionary in nature, such as a photocopy, as long as the original
evidence of that document can be had.29
Based on the explanation above, the best-evidence rule has no application to
this case. The subject of the inquiry is not the payroll sheet of Tegimenta
rather, the thrust of this case is the abundance of evidence present to prove
the allegation that Oco abandoned her job by being on AWOL. Consequently,
the employer cannot be logically stumped by a payroll sheet, but must be
able to submit testimonial and other pieces of documentary evidence like
leave forms, office memos, warning letters and notices to be able to prove
that the employee abandoned her work.
Finally, petitioners posit that Ocos act of replacing the prayer for
reinstatement with that for separation pay implied that respondent
abandoned her employment.
Abandonment is a matter of intention and cannot lightly be inferred or legally
presumed from certain equivocal acts.30 For abandonment to be appreciated,
there must be a "clear, willful, deliberate, and unjustified refusal of the
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employee to resume employment."31 Here, the mere fact that Oco asked for
separation pay, after she was told to no longer report for work, does not
reflect her intention to leave her job. She is merely exercising her option
under Article 279 of the Labor Code, which entitles her to either
reinstatement and back wages or payment of separation pay.
As an end note, petitioners advance a procedural lapse on the part of the CA.
They argue that since no new facts, evidence or circumstances were
introduced by respondent to the appellate court, it cannot issue a Resolution
that reverses its earlier Decision.
In Astraquillo v. Javier,32 we have similarly dealt with this contention and
considered it as flawed. Our procedural laws allow motions for
reconsideration and their concomitant resolutions, which give the same court
an opportunity to reconsider and review its own ruling.
As stated in Section 5(g) of Rule 135, every court shall have the inherent
power to amend and control its processes and orders, so as to make them
conformable to law and justice. "This power includes the right to reverse
itself, especially when in its honest opinion it has committed an error or
mistake in judgment, and that to adhere to its decision will cause injustice to
a party-litigant."33 Thus, upon finding that petitioners had indeed illegally
dismissed respondent, the CA merely exercised its prerogative to reverse an
incorrect judgment.
IN VIEW THEREOF, the 24 April 2006 Resolution of the Court of Appeals in
CA-G.R. CV No. 87706 is AFFIRMED. The 12 May 2006 Petition for Review on
Certiorari filed by Tegimenta Chemical Philippines, Incorporated and Vivian
Rose D. Garcia is hereby DENIED for lack of merit.
SO ORDERED.
Elsa M. Caete|94 | P a g e
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G.R. SP No. 70085. The assailed CA rulings, in turn, affirmed the computation
of the backwages due respondents Teresa de Guzman and Edgar C.
Tan4 made by the National Labor Relations Commission (NLRC).
The Facts
The respondents were employees of Bani Rural Bank, Inc. and ENOC Theatre
I and II who filed a complaint for illegal dismissal against the petitioners. The
complaint was initially dismissed by Labor Arbiter Roque B. de Guzman on
March 15, 1994. On appeal, the National Labor Relations Commission (NLRC)
reversed Labor Arbiter De Guzman's findings, and ruled that the respondents
had been illegally dismissed. In a resolution5 dated March 17, 1995 the NLRC
ordered the petitioners to:
... [R]einstate the two complainants to their former positions, without loss o
seniority rights and other benefits and privileges, with backwages from the
time o their dismissal (constructive) until their actual reinstatement, less
earnings elsewhere.6
The parties did not file any motion for reconsideration or appeal. The March
17, 1995 resolution of the NLRC became final and executory and the
computation of the awards was remanded to the labor arbiter for execution
purposes.
The first computation of he monetary award under the March ,17 1995
resolution of the NLRC
The computation of the respondents' backwages, under the terms of the
March 17 1995 NLRC resolution was remanded to Labor Arbiter Rolando D.
Gambito. First, Labor Arbiter Gambito deducted the earnings derived by the
respondents either from Bani Rural Bank, Inc. or ENOC Theatre I and II.
Second, Labor Arbiter Gambito fixed the period of backwages from the
respondents' illegal dismissal until August 25 1995 or the date when the
respondents allegedly manifested that they no longer wanted to be
reinstated.7
The respondents appealed Labor Arbiter Gambito's computation with the
NLRC. In a
Decision8 dated July 31, 1998, the NLRC modified the terms of the March 17,
1995 resolution insofar as it clarified the phrase less earnings elsewhere. The
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On January 29, 1999, the July 31, 1998 decision of the NLRC lapsed to finality
and became executory.
The second computation of the monetary awards under the July 31, 998
decision of the NLRC
The recomputation of the monetary awards of the respondents' backwages
and separation pay, according to the decision dated July 31, 1998 and the
modified terms of the March 17, 1995 resolution of the NLRC, was referred to
Labor Arbiter Gambito. In the course of the recomputation, the petitioners
filed before Labor Arbiter Gambito a Motion to Quash Writ of
Execution and Suspend Further Execution they reiterated their position that
the respondents backwages should be computed only up to August 25, 1995,
citing the alleged manifestation made by the respondents, through Samuel
de la Cruz, as their basis.
In an order11 dated July 12, 2000, Labor Arbiter Gambito computed the
respondents backwages only up to August 25, 1995.
The NLRCs Ruling
The respondents appealed the July 12, 2000 order of Labor Arbiter Gambito
to the NLRC, which reversed Labor Arbiter Gambito s order. In its
decision12 dated September 28, 2001, the NLRC ruled that the computation
of the respondents backwages should be until January 29 1999 which was
the date when the July 31, 1998 decision attained finality:
WHEREFORE, the Order of Labor Arbiter Rolando D. Gambito dated July 12,
2000 is SET ASIDE. In lieu thereof, judgment is hereby rendered by ordering
respondents to p y complainants backwages up to January 29, 1999 as above
discussed.13
The NLRC emphasized that the issue relating to the computation of the
respondents backwages had been settled in its July 31, 1998 decision. In a
resolution dated January 23, 2002, the NLRC denied the motion for
reconsideration filed by the petitioners.
The petitioners disagreed with the NLRC s ruling and filed a petition for
certiorari with the CA, raising the following issues:
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Citing the case of Chronicle Securities Corp. v. NLRC,17 the CA held that
backwages are granted to an employee or worker who had been illegally
dismissed from employment. If reinstatement is no longer possible, the
backwages shall be computed from the time of the illegal termination up to
the finality of the decision.
The Present Petition
The petitioners argue that the following reversible errors were committed by
the CA, namely:
(1) In ruling that no grave abuse of discretion was committed by the
NLRC when it issued the September 28, 2001 decision, the January 23,
2002 resolution and the July 31, 1998 decision, which modified the final
and executory resolution dated March 17, 1995 of the NLRC computing
the backwages only until the reinstatement of the respondents;
(2) When it manifestly overlooked or misappreciated relevant facts, i.e.
Labor Arbiter Gambito s computation did conform to the NLRC s March
17, 1995 resolution considering the manifestation of Samuel that the
respondents no longer wanted to be reinstated, in response to the
order of execution dated August 25, 1995; and
(3) When it declared that only errors o judgment, and not jurisdiction,
were committed by the NLRC.
In their Comment,18 the respondents contend that the computation of the
backwages until January 29, 1999 was consistent with the tenor of the
decision dated July 31, 1998 and the modified March 17, 1995 resolution of
the NLRC.
After the petitioners filed their Reply,19 the Court resolved to give due course
to the petition; in compliance with our directive, the parties submitted their
respective memoranda repeating the arguments in the pleadings earlier
filed.20
The Issue
As presented, the issue boils down to whether the respondents backwages
had been correctly computed under the decision dated September 28, 2001
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of the NLRC, as confirmed by the CA, in light of the circumstance that there
were two final NLRC decisions affecting the computation of the backwages.
The Court s Ruling
We find the petition unmeritorious.
Preliminary considerations
In Session Delights Ice Cream and Fast Foods v. Court of Appeals (Sixth
Division),21 we held that a decision in an illegal dismissal case consists
essentially of two components:
The first is that part of the decision that cannot now be disputed because it
has been confirmed with finality. This is the finding of the illegality of the
dismissal and the awards of separation pay in lieu of reinstatement,
backwages.
The second part is the computation of the awards made.22
The first part of the decision stems from the March 17, 1995 NLRC resolution
finding an illegal dismissal and defining the legal consequences of this
dismissal. The second part involves the computation of the monetary award
of backwages and the respondents' reinstatement. Under the terms of the
March 17, 1995 resolution, the respondents' backwages were to be
computed from the time of the illegal dismissal up to their reinstatement.
In the first computation of the backwages, Labor Arbiter Gambito confronted
the following circumstances and the Sheriffs Report dated November 8,
1995:23 first, how to interpret the phrase less earnings elsewhere as stated in
the dispositive portion of the March 17, 1995 resolution of the NLRC; second,
the effect of the alleged manifestation (dated October 9, 1995) of Samuel
that the respondents were only interested in the monetary award, not in their
reinstatement; and third, the effect of the respondents' counsel's statement
during the pre-execution proceedings that the respondents simply wanted to
be reinstated.
The records indicate that the respondents denied Samuel's statement and
asked for reinstatement through their counsel. Nevertheless, Labor Arbiter
Gambito relied on Samuel's statement and fixed the computation date of the
respondents' backwages to be up to and until August 25, 1995 or the date
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the order of execution was issued for the NLRC's March 17, 1995 decision. As
stated in his July 12, 2000 order,24 Labor Arbiter Gambito found it fair and
just that in the execution of the NLRC's decision, the computation of the
respondents' backwages should "stop at that time when it was put on record
by them [respondents] that they had no desire to return to work."25
The NLRC disregarded Labor Arbiter Gambito's first computation. In the
dispositive portion of its July 31, 1998 decision, the NLRC modified the final
March 17, 1995 resolution. The first part of this decision -the original ruling of
illegal dismissal -was left untouched while the second part of the decision
-the monetary award and its computation -was altered to conform with the
strained relations between the parties that became manifest during the
execution phase of the March 17, 1995 resolution.
The effect of the modification of the March 17, 1995 resolution of the NLRC
was two-fold: , the reinstatement aspect of the March 1 7, 1995 resolution
was expressly substituted by an order of payment of separation pay; and two
the July 31, 1998 decision of the NLRC now provided for two monetary
awards (backwages and separation pay). The July 31, 1998 decision of the
NLRC became final since neither parties appealed.
Immutability of Judgment
That there is already a final and executory March 17, 1995 resolution finding
that respondents have been illegally dismissed, and awarding backwages
and reinstatement, is not disputed. That there, too, is the existence of
another final and executory July 31, 1998 decision modifying the
reinstatement aspect of the March 17, 1995 resolution, by awarding
separation pay, is likewise beyond dispute.
As a rule, "a final judgment may no longer be altered, amended or modified,
even if the alteration, amendment or modification is meant to correct what is
perceived to be an erroneous conclusion of fact or law and regardless of
what court, be it the highest Court of the land, rendered it. Any attempt on
the part of the x x x entities charged with the execution of a final judgment
to insert, change or add matters not clearly contemplated in the dispositive
portion violates the rule on immutability of judgments."26 An exception to this
rule is the existence of supervening events27 which refer to facts transpiring
after judgment has become final and executory or to new circumstances that
developed after the judgment acquired finality, including matters that the
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parties were not aware of prior to or during the trial as they were not yet in
existence at that time.28
Under the circumstances of this case, the existence of the strained relations
between the petitioners and the respondents was a supervening event that
justified the NLRC s modification of its final March 17, 1995 resolution. The
NLRC, in its July 31, 1998 decision, based its conclusion that strained
relations existed on the conduct of the parties during the first execution
proceedings before Labor Arbiter Gambito. The NLRC considered the delay in
the respondents reinstatement and the parties conflicting claims on whether
the respondents wanted to be reinstated.29 The NLRC also observed that
during the intervening period from the first computation (which was done in
1995) to the appeal and resolution of the correctness of the first computation
(subject of the NLRC s July 31, 1998 decision), neither party actually did
anything to implement the respondents reinstatement. The NLRC considered
these, actions as indicative of the strained relations between the parties so
that neither of them actually wanted to implement the reinstatement decree
in the March 17, 1995 resolution. The NLRC concluded that the award of
reinstatement was no longer possible; thus, it awarded separation pay, in
lieu of reinstatement. Unless exceptional reasons are presented, these above
findings and conclusion can no longer be disturbed after they lapsed to
finality.
Appeal of labor case under Rule 45
A review of the CA s decision in a labor case, brought to the Court via Rule 45
of the Rules of Court, is limited to a review of errors of law imputed to the CA.
In Montoya v. Transmed Manila Corporation,30 we laid down the basic
approach in reviews of Rule 45 decisions of the CA in labor cases, as follows:
In a Rule 45 review, we consider the correctness of the assailed CA decision,
in contrast with the review for jurisdictional error that we undertake under
Rule 65. Furthermore, Rule 45 limits us to the review of questions of law
raised against the assailed CA decision. In ruling for legal correctness, we
have to view the CA decision in the same context that the petition for
certiorari it ruled upon was presented to it; we have to examine the CA
decision from the prism of whether it correctly determined the presence or
absence of grave abuse of discretion in the NLRC decision before it, not on
the basis of whether the NLRC decision on the merits of the case was correct.
In other words, we have to be keenly aware that the CA undertook a Rule 65
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review, not a review on appeal, of the NLRC decision challenged before it.
This is the approach that should be basic in a Rule 45 review of a CA ruling in
a labor case. In question form, the question to ask is: Did the C correctly
determine whether the NLRC committed grave abuse of discretion in ruling
on the case?
This manner of review was reiterated in Holy Child Catholic School v Hon.
Patricia Sta. Tomas, etc., et al.,31 where the Court limited its review under
Rule 45 of the CA s decision in a labor case to the determination of whether
the CA correctly resolved the presence or absence of grave abuse of
discretion in the decision of the Secretary of Labor, and not on the basis of
whether the latter's decision on the merits of the case was strictly correct.
Grave abuse of discretion, amounting to lack or excess of jurisdiction, has
been defined as the capricious and whimsical exercise of judgment
amounting to or equivalent to lack of jurisdiction.32 There is grave abuse of
discretion when the power is exercised in an arbitrary or despotic manner by
reason of passion or personal hostility, and must be so patent and so gross
as to amount to an evasion of a positive duty or to a virtual refusal to
perform the duty enjoined or to act at all in contemplation of law."33
With this standard in mind, we find no reversible error committed by the CA
when it found no grave abuse of discretion in the NLRC's ruling. We find the
computation of backwages and separation pay in the September 28, 2001
decision of the NLRC consistent with the provisions of law and jurisprudence.
The computation conforms to the terms of the March 17, 1995 resolution (on
illegal dismissal and payment of backwages) and the July 31, 1998 decision
(on the computation of the backwages and the payment of separation pay).
Article 279 of the Labor Code, as amended,34 provides backwages and
reinstatement as basic awards and consequences of illegal dismissal:
Article 279. Security of Tenure. -x x x An employee who is unjustly dismissed
from work shall be entitled to reinstatement without loss of seniority rights
and other privileges and to his full backwages, inclusive of allowances, and
to his other benefits or their monetary equivalent computed from the time
his compensation was withheld from him up to the time of his actual
reinstatement.
"By jurisprudence derived from this provision, separation pay may [also] be
awarded to an illegally dismissed employee in lieu of
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finality of the decision dated July 31, 1998 of the National Labor
Relations Commission in NLRC CN. SUB-RAB-01-07- 7-0136-93 CA No.
L-001403 and NLRC CN. SUB-RAB-01-07-7-0137-93 CA No. L-001405;
(b) Separation pay computed from respondents' first day of
employment up to January 29, 1999 at the rate of one (1) month pay
per year of service; and
(c) Legal interest of six percent (6) per annum of the total monetary
awards computed from January 29, 1999 until their full satisfaction.
The labor arbiter is hereby ORDERED to make another recomputation
according to the above directives.
SO ORDERED.
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Macarthur Malicdem
P20,111.26
963.30
11,471.20
7,676.76
20,111.26
; and
Elsa M. Caete|111 | P a g e
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2.
Herminigildo Flores
P18,440.50
963.30
8/28/08 6/30/10 =
11,471.20
6,006.00
18,440.50
All other claims are dismissed for lack of merit.
SO ORDERED.6
Malicdem and Flores appealed to the NLRC which partially granted their
appeal with the award of payment of 13th month pay, service incentive
leave and holiday pay for three (3) years. The dispositive portion of its
December 19, 2011 Decision7 reads:
WHEREFORE, the appeal is GRANTED IN PART. The Decision of Labor Arbiter
Raymund M. Celino, dated July 13, 2011, is MODIFIED. In addition to the
award of salary differentials, complainants should also be awarded 13th
month pay, service incentive leave and holiday pay for three years.
SO ORDERED.8
Still, petitioners filed a motion for reconsideration, but it was denied by the
NLRC on February 29, 2011.
Aggrieved, Malicdem and Flores filed a petition for certiorari under Rule 65
with the CA.
On July 18, 2012, the CA denied the petition,9 finding no grave abuse of
discretion amounting to lack or excess of jurisdiction on the part of the NLRC.
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It ruled that the issue of whether or not the petitioners were project
employees or regular employees was factual in nature and, thus, not within
the ambit of a petition for certiorari. Moreover, it accorded respect and due
consideration to the factual findings of the NLRC, affirming those of the LA,
as they were supported by substantial evidence.
On the substantive issue, the CA explained that "the repeated and
successive rehiring of project employees do not qualify them as regular
employees, as length of service is not the controlling determinant of the
employment tenure of a project employee, but whether the employment has
been fixed for a specific project or undertaking, its completion has been
determined at the time of the engagement of the employee."10
Corollarily, considering that there was no illegal dismissal, the CA ruled that
payment of backwages, separation pay, damages, and attorney's fees had
no factual and legal bases. Hence, they could not be awarded to the
petitioners.
Aggrieved, Malicdem and Flores filed a motion for reconsideration, but their
pleas were denied in the CA Resolution, dated November 12, 2012.
The Petition
Malicdem and Flores now come before this Court by way of a petition for
review on certiorari under Rule 45 of the Rules of Court praying for the
reversal of the CA decision anchored on the principal argument that the
appellate court erred in affirming the NLRC decision that there was no illegal
dismissal because the petitioners contracts of employment with the
respondents simply expired. They claim that their continuous rehiring paved
the way for their regularization and, for said reason, they could not be
terminated from their jobs without just cause.
In their Comment,11 the respondents averred that the petitioners failed to
show that the CA erred in affirming the NLRC decision. They posit that the
petitioners were contractual employees and their rehiring did not amount to
regularization. The CA cited William Uy Construction Corp. v.
Trinidad,12 where it was held that the repeated and successive rehiring of
project employees did not qualify them as regular employees, as length of
service was not the controlling determinant of the employment tenure of a
project employee, but whether the employment had been fixed for a specific
project or undertaking, its completion had been determined at the time of
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the engagement of the employee. The respondents add that for said reason,
the petitioners were not entitled to full backwages, separation pay, moral
and exemplary damages, and attorneys fees.
Now, the question is whether or not the CA erred in not finding any grave
abuse of discretion amounting to lack or excess of jurisdiction on the part of
the NLRC.
The Courts Ruling:
The Court grants the petition.
The petitioners have convincingly shown that they should be considered
regular employees and, as such, entitled to full backwages and other
entitlements.
A reading of the 2008 employment contracts,13 denominated as "Project
Employment Agreement," reveals that there was a stipulated probationary
period of six (6) months from its commencement. It was provided therein
that in the event that they would be able to comply with the companys
standards and criteria within such period, they shall be reclassified as project
employees with respect to the remaining period of the effectivity of the
contract. Specifically, paragraph 3(b) of the agreement reads:
The SECOND PARTY hereby acknowledges, agrees and understands that the
nature of his/her employment is probationary and on a project-basis. The
SECOND PARTY further acknowledges, agrees and understands that within
the effectivity of this Contract, his/her job performance will be evaluated in
accordance with the standards and criteria explained and disclosed to
him/her prior to signing of this Contract. In the event that the SECOND PARTY
is able to comply with the said standards and criteria within the probationary
period of six month/s from commencement of this Contract, he/she shall be
reclassified as a project employee of (o)f the FIRST PARTY with respect to the
remaining period of the effectivity of this Contract.
Under Article 281 of the Labor Code, however, "an employee who is allowed
to work after a probationary period shall be considered a regular employee."
When an employer renews a contract of employment after the lapse of the
six-month probationary period, the employee thereby becomes a regular
employee. No employer is allowed to determine indefinitely the fitness of its
employees.14 While length of time is not the controlling test for project
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Now that it has been clearly established that the petitioners were regular
employees, their termination is considered illegal for lack of just or
authorized causes. Under Article 279 of the Labor Code, an employee who is
unjustly dismissed from work shall be entitled to reinstatement without loss
of seniority rights and other privileges and to his full backwages, inclusive of
allowances, and to his other benefits or their monetary equivalent computed
from the time his compensation was withheld from him up to the time of his
actual reinstatement. The law intends the award of backwages and similar
benefits to accumulate past the date of the LA decision until the dismissed
employee is actually reinstated.
WHEREFORE, the petition is GRANTED. The assailed July 18, 2012 decision of
the Court of Appeals and its November 12, 2012 Resolution in CA-G.R. SP No.
1244 70, are hereby ANNULLED and SET ASIDE.
Accordingly, respondent Marulas Industrial Corporation is hereby ordered to
reinstate petitioners Macarthur Malicdem and Hermenigildo Flores to their
former positions without loss of seniority rights and other privileges and to
pay their full backwages, inclusive of allowances and their other benefits or
their monetary equivalent computed from the time their compensations were
withheld from them up to the time of their actual reinstatement plus the
wage differentials stated in the July 13, 2011 decision of the Labor Arbiter, as
modified by the December 19, 2011 NLRC decision.
SO ORDERED.
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