TAGAYAN #253

Reliefs
Garcia v. Philippine Airlines, January 20, 2009

FACTS: The case stemmed from the administrative charge filed by PAL against its employees-herein petitioners 3 after they
were allegedly caught in the act of sniffing shabu when a team of company security personnel and law enforcers raided the PAL
Technical Center’s Toolroom Section on July 24, 1995. After due notice, PAL dismissed petitioners on October 9, 1995 for
transgressing the PAL Code of Discipline,4 prompting them to file a complaint for illegal dismissal and damages which was,
by Decision of January 11, 1999,5 resolved by the Labor Arbiter in their favor, thus ordering PAL to, inter alia, immediately comply
with the reinstatement aspect of the decision. Prior to the promulgation of the Labor Arbiter’s decision, the Securities and
Exchange Commission (SEC) placed PAL (hereafter referred to as respondent), which was suffering from severe financial
losses, under an Interim Rehabilitation Receiver, who was subsequently replaced by a Permanent Rehabilitation Receiver on
June 7, 1999. By Manifestation and Compliance of October 30, 2007, respondent informed the Court that the SEC, by Order of
September 28, 2007, granted its request to exit from rehabilitation proceedings.

ISSUE: W/N petitioners may collect their wages during the period between the LA’s order of reinstatement pending appeal and the
NLRC decision overturning that of the LA’s, now that respondent has exited from rehabilitation proceedings.

RULING: NO. SC affirms that even if the order of reinstatement of the LA is reversed on appeal, it is obligatory on the part of the
employer to reinstate and pay the wages of the dismissed employee during the period of appeal until reversal by the higher court.
This settles that the LA’s order of reinstatement is immediately executory and the employer has to either (1) re-admit them to work
or (2) to reinstate them in the payroll, and that failing to exercise either of the 2 options will require the employer to pay the
employee’s salaries. However, after the LA’s decision is reversed by a higher tribunal, the EE may be barred from collecting the
accrued wages, if it is shown that the delay in enforcing the reinstatement pending appeal was without the fault on the part of the
ER. The test here is twofold: (1) there must be actual delay or the fact that the order of reinstatement pending appeal was
not executed period to its reversal; and (2) the delay must not be due to the ER’s unjustified act or omission. If the delay is
due to the employer’s unjustified refusal, the ER may still be required to pay the salaries notwithstanding the reversal of
the LA’s decision. HOWEVER, in this case, PAL was not made to pay since it was still under receivership, thus its
obligation to pay did not attach. In sum, the obligation to pay employees’ salaries upon the failure of the employer to exercise the
alternative options under Art. 223 is not a hard and fast rule, considering the inherent constraints of corporate rehabilitation.
 
 
 
Tinae
Case No. 254
Reliefs
Panuncillo v. CAP Phils., February 9, 2007

Facts: Petitioner was hired as Office Senior Clerk by respondent. At the time of her questioned separation from respondent, she
was receiving a monthly salary of ₱16,180.60. Petitioner procured an educational plan from respondent which she had fully paid but
which she later sold to Josefina Pernes. Before the actual transfer of the plan could be effected, however, petitioner pledged it to
John Chua who, however, sold it to Benito Bonghanoy. Bonghanoy in turn sold the plan to Gaudioso R. Uy. Pernes informed
respondent that petitioner had "swindled" her but that she was willing to settle the case amicably as long as petitioner pay the
amount involved and the interest. The plan was not transferred right away because of lacking requirement on the part of the buyer
(birth certificate). She admitted in her letter that she had defrauded Pernes. Respondent also received a copy of the demand letter
from Evelia Casquejo addressed to Ms. Panuncillo requiring the latter to pay for the supposed transfer of the lapsed plan of
Subscriber Corazon Lintag. Respondent thereupon terminated the services of petitioner by Memorandum dated April 20, 1999..
Petitioner sought reconsideration of her dismissal. She expressed in her letter that she would avail of the retirement benefit of the
company. The proceeds of which would be used to pay some of her obligations. Respondent did not allow petitioner to retire with
benefits. Petitioner thus filed a complaint for illegal dismissal, 13th month pay, service incentive leave pay, damages and attorney’s
fees against respondent. LA ruled the dismissal was for a valid cause and ordered petitioner’s reinstatement to a position one rank
lower than her previous position. The NLRC reversed the LA’s decision and ordered petitioner’s reinstatement to her former position
with full backwages from the date her compensation was withheld from her on April 20, 1999 until her actual reinstatement. The CA
reversed the NLRC. 

Issue: Whether the CA erred in ruling that the petitioner is entitled to her full backwages from the date of her compensation was
withheld from her on April 20, 1999 pursuant to the decision of the NLRC. 

Ruling: No. The third paragraph of Article 223 of the Labor Code is clear, however – the employee, who is ordered reinstated, must
be accepted back to work under the same terms and conditions prevailing prior to his dismissal or separation. Petitioner’s being
demoted to a position one rank lower than her original position is certainly not in accordance with the said third paragraph provision
of Article 223. The order to reinstate is incompatible with a finding that the dismissal is for a valid cause. 

In view of Article 224 of the Labor Code, unlike the order for reinstatement of a Labor Arbiter which is self-executory, that
of the NLRC is not. There is still a need for the issuance of a writ of execution. Petitioner is not entitled to collect any
backwages from the time the NLRC decision became final and executory up to the time the Court of Appeals reversed said decision.
It does not appear that a writ of execution was issued for the implementation of the NLRC order for reinstatement. 

In sum, while under the sixth paragraph of Article 223 of the Labor Code, the decision of the NLRC becomes final and
executory after the lapse of ten calendar days from receipt thereof by the parties, the adverse party is not precluded from
assailing it via Petition for Certiorari under Rule 65 before the Court of Appeals and then to this Court via a Petition for
Review under Rule 45. If during the pendency of the review no order is issued by the courts enjoining the execution of a
decision of the Labor Arbiter or NLRC which is favorable to an employee, the Labor Arbiter or the NLRC must exercise
extreme prudence and observe judicial courtesy when the circumstances so warrant. 
TINGKAHAN
CASE NO. 255

RELIEF
COMPOSITE ENTERPRISES V. CAPAROSO, AUGUST 8, 2007

FACTS: Respondent Composite Enterprises Incorporated is engaged in the distribution and supply of confectioneries to various
retail establishments within the Philippines. Petitioners Caparoso and Quindipan were Composite’s deliverymen. Caparoso alleged
that he was hired on November 1998 while Quindipan alleged that he was hired on intermittent basis since 1997. On October 1999,
the petitioners were dismissed from the service. They filed before the Labor Arbiter charging Composite and its Personnel Manager
Edith Tan with illegal dismissal. Respondents, in their answer, alleged that petitioners were both hired on May 1999 as deliverymen,
initially for three months and then on a month-to-month basis. They also allege that petitioners’ termination resulted from the
expiration of their contracts of employment. The Labor Arbiter ruled that petitioners are regular employees of respondents, holding
that by the very nature of respondents’ business and the nature of petitioners’ services, there is no doubt as to the employment
status of petitioners. Respondents appealed to the NLRC. The NLRC set aside the Labor Arbiter’s Decision, ruling that the mere fact
that the employees’ duties are necessary or desirable in the business or trade of the employer does not mean that they are
forbidden from stipulating the period of employment. The NLRC further held that petitioners’ contracts of employment are valid and
binding between the contracting parties and shall be considered as the law between them. Petitioners filed a motion for
reconsideration. The NLRC denied the motion.  Petitioners filed a petition for certiorari before the Court of Appeals. Court of Appeals
dismissed the petition and affirmed the NLRC’s Decision, holding that respondents’ manpower requirement varies from month to
month depending on the demand from their clients for their products. Petitioners filed a motion for reconsideration. Court of Appeals
denied the motion for reconsideration. Hence, the petition before the SC.

ISSUE: Whether or not the petitioners are regular employees of respondents.

PROVISION: Art. 280, Labor Code

RULING: NO. The SC rules that the petitioners are not regular employees. Under Article 280 of the Labor Code, a regular
employee is (1) one who is engaged to perform activities that are necessary or desirable in the usual trade or business of
the employer, or (2) a casual employee who has rendered at least one year of service, whether continuous or broken, with
respect to the activity in which he is employed. However, even if an employee is engaged to perform activities that are
necessary or desirable in the usual trade or business of the employer, it does not preclude the fixing of employment for a
definite period. The Court thus laid down the criteria under which fixed-term employment could not be said to be in circumvention
of the law on security of tenure, thus: (1) The fixed period of employment was knowingly and voluntarily agreed upon by the parties
without any force, duress, or improper pressure being brought to bear upon the employee and absent any other circumstances
vitiating his consent; or (2) It satisfactorily appears that the employer and the employee dealt with each other on more or less equal
terms with no moral dominance exercised by the former or the latter. The SC agrees with the Court of Appeals that in this case, the
fixed period of employment was knowingly and voluntarily agreed upon by the parties. The Court of Appeals noted that there was no
indication of force, duress, or improper pressure exerted on petitioners when they signed the contracts. Further, there was no proof
that respondents were regularly engaged in hiring workers for work for a minimum period of five months to prevent the regularization
of their employees. Petitioners’ Employment is akin to Probationary Employment.
 
CASE NO. 256
(RELIEF)
SAGUM v. COURT OF APPEALS G.R. No. 158759, May 26, 2005, Puno
 
FACTS: Petitioner was hired as a Recording/Filing Clerk in June 1980. By her efficiency, loyalty and dedication to the service, she
was promoted as Membership Secretary in April 1981, Acting Executive Secretary in February 1986, and Executive Secretary in
September 1986. As Executive Secretary, she has served eleven (11) National Presidents. After eight (8) years, or on September
17, 1994, petitioner was appointed as Office Manager in concurrent capacity as Executive Secretary. On July 30, 1996, petitioner
was preventively suspended for thirty (30) days. She was served two (2) written notices demanding her explanation for the imputed
offenses and indiscretions, subjected to an administrative investigation, and dismissed by private respondent institute on
September 1, 1996 for gross negligence and loss of trust and confidence.
 
Petitioner states that she again earned the ire of private respondents when she gave an unsolicited advice to the members of the
EXCOM during a Committee Meeting. The EXCOM had allegedly decided to demote Dela Torre, her immediate subordinate, from
her position as Administrative Secretary to a Clerk. Petitioner commented that it would be illegal to demote an employee.On August
31, 1996, after the expiration of her thirty-day suspension, petitioner called up private respondent Mendoza to ask when she could
go back to work. The latter told her that she could not report for work anymore and advised her to wait for a call. On the same day,
a Memo was issued to petitioner dismissing her effective September 1, 1996 on the ground of gross negligence and loss of trust
and confidence. Petitioner filed a case for illegal dismissal. The LA ruled that petitioner's dismissal was illegal.  The NLRC reversed
the decision of the Labor Arbiter. The Court of Appeals found the decision of the Labor Arbiter to be more conformable with the
evidence and the law and granted the petition 
 
ISSUE: Is the petitioner entitled to reinstatement?
 
HELD: YES. We find for the petitioner on the issue of reinstatement.
 
Article 279 of the Labor Code provides the law on reinstatement, viz.:
Article 279. Security of Tenure. -- In cases of regular employment, the employer shall not terminate the services of an employee
except for a just cause or when authorized by this Title. 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 existence of strained relations is a factual finding and should be initially raised, argued and proven before the Labor Arbiter.
Petitioner is correct that the finding of strained relations does not have any basis  on the records. Indeed, nowhere was the
issue raised in private respondents' pleadings before the Labor Arbiter and the NLRC. Sieving through the records, private
respondents first raised the issue in their Comment to Petitioner's Motion for Partial Reconsideration    before    the     Court    
of   Appeals. In Globe-Mackay Cable and Radio Corporation v. NLRC, we emphasized that the  principle of strained
relations cannot be applied indiscriminately. Otherwise, an illegally dismissed employee can never be reinstated
because invariably, some hostility is engendered between litigants. As a rule, no strained relations should arise from a
valid and legal act of asserting one's right; otherwise, an employee who asserts his right could be easily separated
from the service by merely paying his separation pay on the pretext that his relationship with his employer had already
become strained.
 
In the case at bar, there are no hard facts upon which to base the application of the doctrine of strained relationship. Petitioner is
correct that mere persistency in argument does not amount to proof,and to deny an employee's right to be reinstated on the basis
of the mere consistency of the employer's stand that the dismissal was for cause is to make a mockery of the right of
reinstatement under Article 279 of the Labor Code.
 
Be that as it may, we reject petitioner's claim for moral and exemplary damages. The award of moral and exemplary damages is
proper when an illegally dismissed employee had been harassed and arbitrarily terminated by the employer, as when the latter
committed an anti-social and oppressive abuse of its right to investigate and dismiss an employee. In the case at bar, we are not
convinced that private respondents acted in a wanton or oppressive manner. The measures undertaken were relevant to the
company-wide audit and investigation conducted within the institute. The suspension of petitioner without prior investigation is
akin to preventive suspension which was necessary pending investigation of company records which she had access to.
Abisana 257
Papertech, Inc. vs. Katando
G.R. No. 236020 January 8, 2020
 
Facts: Katando was a machine operator of Papertech. Papertech filed a complaint for illegal strike against respondents when the
latter started to conduct picketing activities in 2008 after their application for certification election in 2007. The LA sided with
petitioner but this was reverse by the NLRC and ordered respondents reinstatement.
Later in 2013, Papetech sent a notice to Katando and others ordering them to report to various posts. Sometime in December,
Katando received a memorandum stating the urgency of the business require her to be transferred to their Makati branch. The
memo includes that the terms and conditions of her employment remain the same but she will be tasked to clean the area. But
Katando did not comply thus was suspended; after serving her suspension, it was extended for another week before she was given
a notice of dismissal.
NLRC ordered petitioner to pay back wages from the time she was illegally dismissed on Feb 25, 2014 until its final decision.
However, the CA ruled that the doctrine of strained relations cannot apply to Katando as she is part of the rank and file workforce
and does not occupy a managerial or key position in the company.
 
Issue: Whether the CA erred in ordering the reinstatement of Katando instead of granting her separation pay
 
Ruling: Yes. The doctrine of strained relations was first introduced in the case of Balaquezon Employees & Workers
Transportation Union v. Zamora. In Balaquezon, the Court awarded backwages as severance pay based on equity. The
Court explained, “[t]his means that a monetary award is to be paid to the striking employees as an alternative to
reinstatement which can no longer be effected in view of the long passage of time or because of the “realities of the
situation.” After Balaquezon, the Court further expounded on the doctrine of strained relations in the case of Globe-
Mackay Cable and Radio Corp. v. National Labor Relations Commission wherein We discussed the following
considerations in applying the doctrine of strained relations: (1) the employee must occupy a position where he or she
enjoys the trust and confidence of his or her employer; (2) it is likely that if reinstated, an atmosphere of antipathy and
antagonism may be generated as to adversely affect the efficiency and productivity of the employee concerned; (3) it
cannot be applied indiscriminately because some hostility is invariably engendered between the parties as a result of
litigation; and (4) it cannot arise from a valid and legal act of asserting one’s right. After Globe-Mackay, We clarified that the
doctrine cannot apply when the employee has not indicated an aversion to returning to work, or does not occupy a position of trust
and confidence in, or has no say in the operation of, the employer’s business. In addition, strained relations between the parties
must be proven as a fact.
Although Katando does not occupy a position of trust and confidence as a machine operator, the circumstances of this case
nonetheless calls for the application of the doctrine of strained relations. It is true that litigation between the parties per se should not
bar the reinstatement of an employee. However, in the case of Digital Telecommunications Philippines, Inc. v. Digitel
Employees Union, we held that the length of time from the occurrence of the incident to its resolution and the
demonstrated litigiousness of the parties showed that their relationship is strained. Similarly, the protracted litigation
between the parties here sufficiently demonstrate that their relationship is strained. It is notable that Papertech has not
even bothered to appeal the ruling of the Labor Arbiter, and even stated that “in order not to prolong the proceedings, and
for both parties to peacefully move on from this unwanted situation, Papertech is willing to pay the judgment award of
separation pay.” Clearly, Papertech does not want Katando back as its employee.
What remained in Papertech's Pasig City premises was its sales, marketing, and distribution operations. In that lease, the CA held
that the transfer of Papertech's manufacturing and production departments to its provincial plants was valid. Consequently, the
positions held by Katando and her co-respondents in Pasig City were abolished. Bearing this in mind, Katando's reinstatement as a
machine operator in Papertech's Pasig City premises is no longer possible; Thus, separation pay is the only viable option for
Katando.
Baute
Case no. 258
RELIEFS: DOCTRINE OF STRAINED RELATIONS
United Tourist Promotion v. Kemplin, February 5, 2014
 
Facts: In 1995, Jersey, with the help of two American expatriates, Kemplin and the late Mike Dunne, formed UTP, a sole
proprietorship business entity engaged in the printing and distribution of promotional brochures and maps for tourists. In 2002, UTP
employed Kemplin to be its President for a period of five years, to commence on March 1, 2002 and to end on March 1, 2007,
"renewable for the same period, subject to new terms and conditions". Kemplin continued to render his services to UTP even after
his fixed term contract of employment expired. On May 12, 2009, Kemplin, signing as President of UTP, entered into advertisement
agreements with Pizza Hut and M. Lhuillier. On July 30, 2009, UTPs legal counsel sent Kemplin a letter informing his Employment
contract has expired and never been renewed. However, because of his past services to companys clients, by coming to the office,
as such he was given monthly commissions with allowances. But because of his inhuman treatment to the rank and file employees
which caused great damage and prejudices to the company,(calling them brown monkeys) a case for Grave Oral Threat pending
Preliminary Investigation, a Summary Deportation and for Grave Coercion and Grave Threats was filed. Subsequently, he received
a notice from UTPs counsel ordering him to cease and desist from entering the premises of UTP offices. Kemplin filed before the
NLRC a Complaint against UTP and its officer for: (a) illegal dismissal; (b) non-payment of salaries, 13th month and separation pay,
and retirement benefits;
He claimed that even after the expiration of his employment contract on March 1, 2007, he rendered his services as President and
General Manager of UTP. The LA held in favor of Kemplin adjudging he was illegally dismissed by UTP and Jersey and order to pay
him backwages and reinstatement.

Issue: WON CA erred in not applying the Doctrine of Strained Relations

 
Ruling: YES. The Court is well aware that reinstatement is the rule and, for the exception of "strained relations" to apply, it should
be proved that it is likely that, if reinstated, an atmosphere of antipathy and antagonism would be generated as to adversely affect
the efficiency and productivity of the employee concerned. Under the doctrine of strained relations, the payment of separation pay is
considered an acceptable alternative to reinstatement when the latter option is no longer desirable or viable. On one hand, such
payment liberates the employee from what could be a highly oppressive work environment. On the other hand, it releases the
employer from the grossly unpalatable obligation of maintaining in its employ a worker it could no longer trust. Moreover, the
doctrine of strained relations has been made applicable to cases where the employee decides not to be reinstated and demands for
separation pay. Considering that Kemplin’s dismissal occurred in 2009, there is much room to doubt the viability, desirability and
practicability of his reinstatement as UTP’s President. Besides, as a consequence of the unsavory accusations hurled by the
contending parties against each other, Kemplin’s reinstatement is not likely to create an efficient and productive work environment,
hence, prejudicial to business and all the persons concerned. Thus, Kemplin was not reinstated.
Briones

Case no. 259

Reliefs

Tomas Claudio Memorial College v. CA, February 16, 2004

Facts: Sometime in 1983, private respondent Pedro Natividad started working with petitioner Tomas Claudio Memorial College
(TCMC) in Morong, Rizal. In time, he was promoted as "Liason Officer" of the school with the Department of Education, Culture and
Sports (DECS) and with the Commission on Higher Education (CHED) with the rank of Assistant Registrar. On June 10, 1996, the
private respondent was arrested by the Morong police authorities, without any warrant therefore, for violation of the Dangerous
Drugs Act (Republic Act NO. 6425). A criminal complaint was later filed against him, docketed as Criminal Case No. 5137. A
preliminary investigation was conducted by the Municipal Court of Morong, Rizal which found probable cause to hold him for trial.
The court, on the said date, issued a warrant for the private respondent’s arrest. The records were elevated to the Office of the
Provincial Prosecutor of Rizal, and was docketed as I.S. No. 96-4385. In the interim, the petitioner, through its president, Aladdin F.
Trinidad, sent a Memorandum2 dated June 13, 1996 to the private respondent informing him that his employment was already
terminated. Private Respondent filed a complaint for illegal dismissal but “The complaint in this case for "illegal dismissal" is hereby
ordered dismissed for lack of legal basis”. However, on certiorari with the Court of Appeals, the appellate court affirmed, with
modification, the decision of the NLRC, holding that although there was a valid cause for the private respondent’s dismissal, the
petitioner did not follow the procedure for the termination of his employment. The CA ordered the petitioner to pay backwages to the
private respondent from June 13, 1996 up to the finality of the said decision.
Issue: WON Respondent entitled for backwages?
Ruling: YES.  The normal consequences of a finding that an employee has been illegally dismissed, the statutory intent on the
matter and nature of the true remedies of reinstatement and payment of backwages. Though the grant of reinstatement commonly
carries with it an award of backwages, the inappropriateness or non-availability of one does not carry with it the inappropriateness or
non availability of the other. The payment of backwages is generally granted on the ground of equity. It is a form of relief that
restores the income that was lost by reason of the unlawful dismissal; the grant thereof is intended to restore the earnings that
would have accrued to the dismissed employee during the period of dismissal until it is determined that the termination of
employment is for a just cause.
The nature of backwages is a form of relief that restores the income that was lost by reason of the unlawful dismissal. It is a public
command upon employer to make reparation.
In Agabon case, cases where there exists just or authorized cause for dismissal but procedural due process is not met would not
amount to reinstatement or separation pay but instead, merely an award for nominal damages. But, Tomas Claudio was decided in
February 2004 while the Agabon case was decided in November 2004.  So in this case, since there is no procedural process
observed, it amounts to an illegal dismissal.
Casumpang
Case No. 260
Consequences of Dismissal; Relief
Carlos v. CA, August 28, 2007

FACTS: Petitioner Carlos is President of consolidated companies ABC Security and Honest Care Janitorial.  Private respondents
were employed by petitioners on varying years.  In July 1993, private respondents filed a Joint/Consolidated complaint-Affidavit
against petitioners for payment of minimum wage and other money claims.  A day after petitioners received the corresponding
summons, private respondents were allegedly relieved from their posts and were not given new assignments. Petitioners averred
that they were not dismissed but voluntarily resigned, proven by their signed resignation letters. The burden of proving that the
employee was not dismissed or if dismissed, that the dismissal was not illegal, rests on the employer and failure to discharge the
same would mean that the dismissal is not justified. Petitioner failed to discharge this burden. Private respondents are entitled to the
payment of full backwages without deducting their earnings elsewhere during the periods of their illegal dismissal. However, 
reinstatement is no longer feasible due to strained relations between the parties, separation pay equivalent to one month’s salary for
every year of service shall be granted.

ISSUE: When is the period for computation of backwages and separation pay supposed to end? 

RULING: Up to the time of finality of this Court's decision. This question was squarely addressed in Gaco v. NLRC, the
justification is that along with the finality of this Court's decision, the issue of illegal dismissal is finally laid to rest. The petitioners’
insistence that they cannot be held liable for backwages during the period of the pendency of this action for they cannot be faulted
for the delay of the disposition of this case cannot take precedence over the long-standing and well-entrenched jurisprudential rule.
The award for separation pay equivalent to one-month pay for every year of service shall be computed from the time the private
respondents were illegally separated from their employment up to the finality of this Court’s Decision in the instant petition.
ECHEM
CASE NO. 261
RELIEFS
Dumapis v. Lepanto Consolidated Mining Co, September 15, 2020
 
FACTS: In NLRC Case No. RAB-CAR-11-0607-00, LA Tabingan dismissed the complaint for illegal dismissal. NLRC reversed the
decision insofar as to Dumapis, Tundagui, and Liagao. These three were illegally dismissed. The dismissal of the other 9 were
affirmed as having committed highgrading. CA affirmed the decision. SC affirmed the decision in 2008 and in addition, required
Lepanto to pay double costs. On Lepanto's further petition for review on certiorari via G.R. No. 163210, this Court affirmed7 in the
main, and in addition, required Lepanto to pay double costs. The decision became final and executory on November 25,2008.
Petitioners then sought a recomputation of this award which the labor arbiter granted through his Order dated May 27, 2009,9
increasing the award to P2,602,856.21. Lepanto moved to quash the writ of execution,10 insisting that the computation should be
reckoned from the date of dismissal up until the NLRC rendered its Decision dated August 30, 2002. Lepanto further claimed that
the parties had already agreed to satisfy the original monetary award of P897,412.95, for which, an initial amount of P100,000.00
was already deposited into the account of petitioners' counsel. Meantime, petitioners moved for another recomputation of the
monetary award to include the salary increases allegedly granted them per the Collective Bargaining Agreement (CBA) between
Lepanto and the employees. Too, petitioners denied that they accepted the original monetary award although they acknowledged
Lepanto's deposit of P100,000.00 into their counsel's account.
 
ISSUE: What is the correct formula for computing the award of separation pay and backwages to petitioners?
 
RULING: In CICM Mission Seminaries, et al. v. Perez citing Bani Rural Bank, Inc. v. De Guzman, the Court through the Second
Division laid down the rule that the award of separation pay and backwages for illegally dismissed employees should be
computed from the time they got illegally dismissed until the finality of the decision ordering payment of their separation
pay, in lieu of reinstatement. The reason for this was explained in Bani Rural Bank, Inc. v. De Guzman. When there is an order of
separation pay (in lieu of reinstatement or when the reinstatement aspect is waived or subsequently ordered in light of a
supervening event making the award of reinstatement no longer possible), the employment relationship is terminated only upon the
finality of the decision ordering the separation pay. The finality of the decision cuts-off the employment relationship and represents
the final settlement of the rights and obligations of the parties against each other. Hence, backwages no longer accumulate upon
the finality of the decision ordering the payment of separation pay because the employee is no longer entitled to any
compensation from the employer by reason of the severance of his employment. One cannot, therefore, attribute patent error
on the part of the CA when it merely affirmed the NLRC's conclusion, which was clearly based on jurisprudence. Plainly, it does not
matter if the delay caused by an appeal was brought about by the employer or by the employee. The rule is, if the LA's decision,
which granted separation pay in lieu of reinstatement, is appealed by any party, the employer-employee relationship subsists and
until such time when decision becomes final and executory, the employee is entitled to all the monetary awards awarded by the LA.
In this case, respondent remained an employee of the petitioners pending her partial appeal. Her employment was only severed
when this Court, in G.R. No. 200490, affirmed with finality the rulings of the CA and the labor tribunals declaring her right to
separation pay instead of actual reinstatement. Accordingly, she is entitled to have her backwages and separation pay computed
until October 4, 2012, the date when the judgment of this Court became final and executory, as certified by the Clerk of Court, per
the Entry of Judgment in G.R. No. 200490.
In accordance with CICM Mission Seminaries, petitioners' backwages and separation pay here should, therefore, be computed from
September 22, 2000 when they got illegally dismissed until November 25, 2008, when this Court's Decision dated August 13, 2008
became final and executory.
HABING
CASE NO. 262
CONSEQUENCE OF DISMISSAL 
United Coconut Chemicals, Inc. v. Valmores
G.R. No. 201018;  July 12, 2017

FACTS: UCCI hired Victoriano Valmores as its Senior Utilities Inspector. He then became a member of the company’s
union until his expulsion. Due to the expulsion, UELO formally demanded that UCCI to terminate the services of Valmores pursuant
to the union security clause of the CBA. UCCI dismissed him. He filed a complaint for illegal dismissal in the NLRC, which ruled in
his favor and ordered UCCI to reinstate Victoriano to his former position without loss of seniority rights and with full backwages from
the date of dismissal on 22 February 1996 to the date of actual reinstatement. The LA used the sum representing Victoriano’s wage
rate at the time of his dismissal and included in the computation 13th month pay and SIL but excluded CBA granted benefits.
 
ISSUE:  Whether the increase in the benefits during the pendency of the case should be included in the computation of backwages. 

RULING: No. The extent of the backwages to be awarded to an illegally dismissed employee has been set in Article 279 of the
Labor Code, viz.: “Article 279. Security of Tenure- In cases of regular employment, the employer shall not terminate the services of
an employee except for a just cause or when authorized by this Title. 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 settled rule is that full backwages shall be pegged at the wage rate at the time of the employee’s dismissal,
unqualified by any deductions and increases, thus: [T]he determination of the salary base for the computation of
backwages requires simply an application of judicial precedents defining the term “backwages.” An unqualified award of
backwages means that the employee is paid at the wage rate at the time of his dismissal. Furthermore, the award of salary
differentials is not allowed, the established rule being that upon reinstatement, illegally dismissed employees are to be
paid their backwages without deduction and qualification as to any wage increases or other benefits that may have been
received by their co-workers who were not dismissed or did not go on strike. The base figure for the computation of
backwages should include not only the basic salary but also the regular allowances being received, such as the emergency living
allowances and the 13th month pay mandated by the law. The purpose for this is to compensate the worker for what he has lost
because of his dismissal, and to set the price or penalty on the employer for illegally dismissing his employee.
The base figure to be used in reckoning full backwages is the salary rate of the employee at the time of his
dismissal. The amount does not include the increases or benefits granted during the period of his dismissal because time
stood still for him at the precise moment of his termination, and move forward only upon his reinstatement. Here, Valmores
should only receive backwages that included the amounts being received by him at the time of his illegal dismissal but not the
benefits granted to his co-employees after his dismissal. The Court is also aware of the reality that salary increases and benefits are
not automatically given to the worker, but are given subject to conditions. As such, Valmonte’s claim for the increases in salary,
meal subsidy, safety incentive pay, SOFA, financial grant and medical assistance for the period from 1997 until 2007, and one-time
CBA increase, should be excluded from his backwages.
JAMDANI-263
Consequences of Dismissal
C.I.C.M. Mission Seminaries v. Perez, January 18, 2017
FACTS: On June 16 2008, the LA recognized that respondent Perez had been illegally dismissed by her employer C.I.C.M. Mission
Seminaries. It ordered petitioners to pay back wages and separation pay. Perez filed appeals, preferring reinstatement. However,
the decision was affirmed by the Supreme Court and became final and executory on October 4, 2012. When Perez moved for a writ
of execution, CICM opposed, claiming that it had already paid her a sufficient cash bond. The amount was computed from the date
of her dismissal up to June 16, 2008. Petitioners argue that it was the employee’s fault why the finality of judgment was delayed.
Thus, they do not have to pay additional backwages and separation pay.

ISSUE: WON backwages and separation pay should be computed from date of finality of judgment, even if the illegally dismissed
employee appealed the decision.

RULING: YES. Backwages and separation pay should be computed from the time of dismissal until the finality of the
decision. The reason for this was explained in Bani Rural Bank v. De Guzman. When there is an order of separation pay (in lieu of
reinstatement or when the reinstatement aspect is waived or subsequently ordered in light of a supervening event making the award
of settlement no longer possible), the employment relationship is terminated only upon the finality of the decision ordering the
separation pay. The finality of the decision cuts off the employment relationship and represents the final settlement of the
rights and obligations of the parties against each other. Hence, backwages no longer accumulate upon the finality of the
decision ordering the payment of separation pay because the employee is no loner entitled to any compensation from the
employer by reason of the severance of his employment. One cannot, therefore, attribute patent error on the part of the CA
when it merely affirmed the NLRC’s conclusion, which was clearly based on jurisprudence.
 In this case, respondent remained an employee of the petitioners pending her partial appeal. Her employment was only
severed when this Court in GR No. 2000490 affirmed with finality the rulings of the CA and the labor tribunal declaring her right to
separation pay instead of actual reinstatement. Accordingly, she is entitled to have her backwages and separation pay computed
until October 4, 2012, the date when the judgment of this Court became final and executory, as certified by the Clerk of Court, per
the entry of judgment in GR No. 200490.

Lim
Case no. 264
Relief: Computation must be until Cessation of business only
Chronicle Securities v. NLRC, November 25, 2004
 

Facts: Petitioners hired private respondent Neal H. Cruz as the publicist and the editor in chief of the Manila Chronicle. Private
respondent went about the task of improving the over-all image of the Manila Chronicle. He made full use of its color capabilities and
introduced new columns and sections. In time, these initiatives helped improve the financial condition of the Manila Chronicle,
boosting circulation and increasing advertising revenue. However, due to private respondent's role in the publication of a
controversial article that was carried by the newspaper, petitioners terminated his services. Consequently, private respondent filed a
complaint for illegal dismissal against herein petitioners. The Labor Arbiter rendered a decision holding that private respondent was
illegally dismissed awarding Cruz 10M in moral damages and 5M in exemplary damages. Petitioners appealed the decision with the
National Labor Relations Commission (NLRC), which affirmed the labor arbiter's decision with modification by reducing the moral
damages to P500,000.00 and exemplary damages to P200,000.00. Petitioners contend that contrary to established jurisprudence,
the Labor Arbiter's computation of the amount due to the private respondent was principally based on the mistaken premise that
complainant was entitled to backwages even beyond the closure and cessation of petitioners' newspaper business on January 19,
1998.

Issue: WON the LA committed reversible error in the computation of Private Respondent’s backwages.

Ruling: Yes.  Backwages, in general, are granted on grounds of equity for earnings which a worker or employee has lost due to his
illegal dismissal. In the case at bar, the Manila Chronicle ceased publication on January 19, 1998. The cessation of publication was
a permanent one and it was precipitated by the paper's dire financial condition which was aggravated by a crippling strike causing it
to finally shut down. Petitioners' closure of their newspaper business was made on legal and valid grounds. It was never resorted to
as a means to deprive the private respondent of the opportunity to be reinstated to his former position. To allow the computation of
the backwages due the private respondent to be based on a period beyond January 19, 1998 would be an injustice to the
petitioners. Since the business closed, why would the respondent expect to be paid when there is no work to be done even if he is
not terminated.

 
#265 Napii
Reliefs
Intercontinental Broadcasting v. Benedicto, July 20, 2006
 
Facts: In 1993, Reynaldo Benedicto was appointed by Ceferino Basilio, the general manager then of petitioner, as marketing
manager with a monthly compensation of P20,000 plus 1% commission from collections of all advertising contracts consummated.
Benedicto was terminated from his position by the president of petitioner. Benedicto filed a complaint with the NLRC for illegal
dismissal and damages. He alleged that after his appointment, he was able to increase the televiewing, listening and audience
ratings of petitioner which resulted in its improved competitive financial strength; however, on October 11, 1994, he was terminated
from his position without just or authorized cause. The labor arbiter ruled in favor of Benedicto, finding that he was indeed illegally
dismissed. LA ordered, inter alia, his reinstatement with full backwages from the time of his dismissal up to his actual reinstatement
(amounting to P920,000) but finding the award excessive, petitioner filed an appeal with the NLRC insisting that the award should
be limited to what Benedicto was entitled to as of the compulsory retirement age of 65 years. the NLRC dismissed the appeal and
such decision was affirmed by the CA.
 
Issue: Whether Benedicto was only entitled to the backwages only for the period he could have worked had he not been illegally
dismissed
 
Ruling: Yes. Since backwages are granted on grounds of equity for earnings lost by an employee due to his illegal dismissal. When
Benedicto was illegally dismissed on October 11, 1994, he was already 64 years old. He turned 65 years old on December 1, 1994
at which age he was deemed to have retired. Since backwages are granted on grounds of equity for earnings lost by an employee
due to his illegal dismissal, Benedicto was entitled to backwages only for the period he could have worked had he not been illegally
dismissed, i.e. from October 11, 1994 to December 1, 1994.
 
Additional 
Commissions are given to employees only if the employer receives income. Benedicto's right to the commissions was coterminous
with his employment with petitioner and this ended when he reached the compulsory retirement age.
The stipulation providing for commissions (which did not specify the period of entitlement) would be too burdensome if interpreted to
mean that Benedicto had a right to it even after his employment  
OMAR
Case No. 266
RELIEFS
PFIZER vs VELASCO
March 9, 2011
FACTS: Geraldine L. Velasco was employed with petitioner PFIZER, INC. as Professional Health Care Representative since August
1992. Sometime in April 2003, Velasco had a medical work up for her high-risk pregnancy and was subsequently advised bed rest
which resulted in her extending her leave of absence. Velasco filed her sick leave for the period from 26 March to 18 June 2003, her
vacation leave from 19 June to 20 June 2003, and leave without pay from 23 June to 14 July 2003.
 
While Velasco was still on leave, PFIZER served Velasco a "Show-cause Notice" dated 25 June 2003 about an investigation on her
possible violations of company work rules regarding "unauthorized deals and/or discounts in money or samples and unauthorized
withdrawal and/or pull-out of stocks. She was instructed to submit her explanation on the matter within 48 hours from receipt of the
same. Thus, she was being placed under "preventive suspension" for 30 days. Velasco denied the charges against him. Velasco
then received a "Second Show-cause Notice" informing her of additional developments in their investigation. Again, Velasco was
given 48 hours to submit her written explanation on the matter.
 
Velasco filed a complaint for illegal suspension with money claims before the Regional Arbitration Branch. She likewise opted to
withhold answering the Second Show-cause Notice. On 25 July 2003, Velasco received a "Third Show-cause Notice," together with
copies of the affidavits of two Branch Managers of Mercury Drug, asking her for her comment within 48 hours. Finally, on 29 July
2003, PFIZER informed Velasco of its "Management Decision" terminating her employment.
 
LA: The dismissal of Velasco is illegal. Reinstatement was ordered with back wages and further awarding moral and exemplary
damages with attorney’s fees. NLRC: Upheld the ruling of LA.
 
CA: Reversed the ruling of LA and NLRC. Having found the termination of Velasco’s employment in accordance with the two-notice
rule pursuant to the due process requirement and with just cause, her complaint for illegal dismissal was dismissed. It affirmed the
legality of the dismissal of Velasco but directed Pfizer to pay her wages from the date of the Labor Arbiter’s Decision dated
December 5, 2003 up to the Court of Appeals Decision dated November 23, 2005.
 
ISSUE: Whether or not the CA committed a serious but reversible error when it ordered Pfizer to pay Velasco wages from
the date of the Labor Arbiter’s decision ordering her reinstatement until November 23, 2005, when the Court of Appeals
rendered its decision declaring Velasco’s dismissal valid
 
RULING: NO. An award or order of reinstatement is immediately self-executory without the need for the issuance of a writ
of execution in accordance with the third paragraph of Article 223 of the Labor Code. The provision of Article 223 is clear
that an award [by the LA] for reinstatement shall be immediately executory even pending appeal and the posting of a bond
by the employer shall not stay the execution for reinstatement. It is established in jurisprudence that reinstatement means
restoration to a state or condition from which one had been removed or separated. The person reinstated assumes the position he
had occupied prior to his dismissal.
In the case at bar, PFIZER did not immediately admit respondent back to work which, according to the law, should have been done
as soon as an order or award of reinstatement is handed down by the LA without need for the issuance of a writ of execution.
Furthermore, the court likewise restate our ruling that an order for reinstatement entitles an employee to receive his
accrued back wages from the moment the reinstatement order was issued up to the date when the same was reversed by a
higher court without fear of refunding what he had received. It cannot be denied that, under our statutory and
jurisprudential framework, respondent is entitled to payment of her wages for the period after December 5, 2003 until the
Court of Appeals Decision dated November 23, 2005, notwithstanding the finding therein that her dismissal was legal and
for just cause. Thus, the payment of such wages cannot be deemed as unjust enrichment on respondent’s part.
#267 Napii
Reliefs
University of Pangasinan v. Fernandez, November 12, 2014
 
Facts: This case arose from a complaint for illegal dismissal filed by Florentino and Nilda against UPI, its President Cesar Duque,
Executive Vice-President Juan Llamas Amor and Director for Student Affairs Dominador Reyes. Labor Arbiter Gambito ruled that
the respondents were illegally dismissed by the petitioners. The petitioners interposed an appeal to the NLRC, which affirmed the
Labor Arbiter’s decision. Florentino and Nilda filed a petition before the Court of Appeals which reversed and set aside the NLRC
decision and reinstated that by the Labor Arbiter. The petitioners elevated the case to the Supreme Court but were denied by the
tribunal. As a consequence, an Entry of Judgment was issued by the Supreme Court. Subsequently, Florentino and Nilda moved for
a re-computation of their award to include their backwages and other benefits from the date of the decision of LA Gambito up to the
finality of the decision on July 11, 2005. They likewise moved for the issuance of a writ of execution. During the pre-execution
conference, UPI questioned the re-computation of Florentino and Nilda's backwages and awards. In view of a stand-off, LA Flores
required both parties to submit their respective computations and justifications. Labor Arbiter held that there was a need to update
and upgrade the computation of money claims and separation pay. UPI filed a Motion for Reconsideration but it was denied. The
petitioners interposed an appeal to the NLRC questioning the Order of LA Flores and NLRC granted the appeal. Respondents filed
before the CA primarily anchored on the issue of what the proper basis was for the computation of backwages and benefits to be
paid to an employee. The CA reversed and set aside the NLRC resolution and reinstated the Labor Arbiter’s Order. The petitioners
seek to reverse the CA's ruling by elevating in to the Supreme Court
 
Issue: Whether in computing the backwages and benefits awarded to the respondents, the reckoning period is interrupted by the
NLRC's reversal of LA Gambito's finding of illegal dismissal
 
Ruling: No. In Gonzales, the Court stated that the increase in the amount that the corporation had to pay "is a consequence that it
cannot avoid as it is the risk that it ran when it continued to seek recourses against the LA's decision." Further, in Reyes v. NLRC, et
al., the Court declared that: One of the natural consequences of a finding that an employee has been illegally dismissed is the
payment of backwages corresponding to the period from his dismissal up to actual reinstatement. The statutory intent of this matter
is clearly discernible. The payment of backwages allows the employee to recover from the employer that which he has lost by way
of wages as a result of his dismissal. Logically, it must be computed from the date of petitioner's illegal dismissal up to the time of
actual reinstatement. There can be no gap or interruption, lest we defeat the very reason of the law in granting the same.
 
Additional
The dispositive portion of the herein assailed CA decision did not explicitly refer to the 13th month pay, its inclusion in the
computation approved by LA Flores is proper pursuant to P.D. 851
 
The CA properly imposed a legal interest upon the total monetary award reckoned from the Entry of Judgment on July 11,
2005 until full satisfaction thereof, but the Court modifies the rate indicated in the assailed decision to conform to the
doctrine in Nacar.
The computation of backwages and separation pay due to Florentino and Nilda properly includes the period from 2002 to
2005. In 2002, both had turned 60 and could opt to retire but it is merely optional but not the mandatory retirement age.
#268 Tangkian
Bago v. NLRC, Standard Insurance Co. Inc. (SICI)
Topic: Security of Tenure; Consequences of dismissal
FACTS:
●      A certain Celia Abordo, head of SICI, charged 5 employees including petitioner Arlyn Bago (encoder) and a certain
Elsie Pagarigan (assistant underwriter) with "manipulating money out of the agents/zone managers and Celia’s
commissions." She further charged Arlyn and two other employees with "spreading rumors to clients/agents/zone
managers that Celia is having an ‘affair’ with the claims assistant."
●      A special audit was conducted upon recommendation of Celia revealed acts of dishonesty and connivance between
the Branch Cashier, Accountant, Underwriter, and the Encoder during the meeting as evidenced by their signing on the
auditors’ report on November 27, 2002. They admitted that the amount they get from the acts of dishonesty is divided
equally among them. The audit also disclosed that the alleged rumor about Celia started when she requested the Claims
Evaluator to drive for her and allowed him to bring home her car.
●      The Human Resource Development Department (HRDD) of respondent SICI then directed Arlyn and the two other
concerned employees to explain within five days why appropriate sanction under SICI’s Code of Conduct should not be
imposed on them relative to the charge of spreading malicious rumors about Celia. Arlyn and the employees complied.
●      By 2003, after a formal hearing, petitioner Arlyn Bago was terminated from employment. Arlyn and Elsie
subsequently filed separate complaints for illegal dismissal against respondent SICI and its President-co-respondent
Ernesto T. Echaus. The complaints were consolidated.
●      Labor Arbiter Reyes ruled that Bago and Pagarigan was illegally dismissed and order their reinstatement. On appeal
by SICI to the NLRC, the latter reversed the LA decision and declared valid the termination of Arlyn and Elsie’s services
on the grounds of loss of trust and confidence and dishonesty.
●      Arlyn and Elsie appealed before the CA but was denied.
●      Hence, the present petition for review.
ISSUE:
1] Whether petitioner Bago is an ordinary rank-and-file employee, hence, she cannot be dismissed for loss of trust and confidence?
2] Whether dismissal from employment is the proper penalty for petitioner Bago?

RULING:
1] NO.  The Supreme Court concluded that Arlyn’s claim that she is an ordinary rank-and-file employee, hence, she cannot be
dismissed for loss of trust and confidence does not lie. The observation of the Court of Appeals that "her work is of such nature as to
require a substantial amount of trust and confidence on the part of her employer" is well-taken in light of her following functions, as
enumerated by the NLRC: 1. Batches, collates and encodes policies, endorsements and official receipts; 2. Generates printed
production, collection, statistical and receivable reports for submission to the Head Office; 3. Reconciles and finalizes production
and collection reports; 4. Maintains the computer hardware and software; and 5. Performs other related functions as may be
assigned to her by her superior from time to time, which functions "required the use of judgment and discretion." Arlyn of course
incorrectly assumes that mere rank-and-file employees cannot be dismissed on the ground of loss of confidence. Jurisprudence
holds otherwise albeit it requires "a higher proof of involvement" in the questioned acts.
As a general rule, employers are allowed a wide latitude of discretion in terminating the employment of managerial personnel or
those who, while not of similar rank, perform functions which by their nature require the employer’s full trust and confidence. Proof
beyond reasonable doubt is not required. This must be distinguished from the case of ordinary rank-and-file employees, whose
termination on the basis of these same grounds requires a higher proof of involvement in the events in question; mere
uncorroborated assertions and accusations by the employer will not suffice.
Even assuming that Arlyn may be considered a rank and file employee, sufficient evidence of her involvement in the dishonest
scheme of SICI’s accountant and cashier who were also charged and found guilty exists. Not only was her participation established
by the internal audit conducted; the cashier identified her as part of the scheme,36 and she herself admitted her involvement. Her
claim that she merely received money from the cashier and the accountant without knowledge of its illegal source is contradicted by
her subsequent statement of January 7, 2003 submitted to the HRDD owning up to having participated in the scheme.
But even assuming further that Arlyn may not be dismissed for loss of confidence, she can, on the ground of fraud or betrayal of
trust under Art. 282 of the Labor Code.
2] YES. In Salvador v. Philippine Mining Service Corp., to wit: To be sure, length of service is taken into consideration in imposing
the penalty to be meted an erring employee. However, the case at bar involves dishonesty and pilferage by petitioner which resulted
in respondent’s loss of confidence in him. Unlike other just causes for dismissal, trust in an employee, once lost is difficult, if not
impossible, to regain. And, in Flores v. NLRC, the fact that petitioner worked for private respondent for twenty-one (21) years, if it is
to be considered at all, should be taken against him. The infraction that he committed, vis-à-vis his long years of service with
the company, reflects a regrettable lack of loyalty. Loyalty that he should have strengthened instead of betrayed. If an
employee’s length of service is to be regarded as a justifying circumstance in moderating the penalty of dismissal, it will
actually become a prize for disloyalty, perverting the meaning of social justice and undermining the efforts of labor to
cleanse its ranks of all undesirables.
 
 

TAGAYAN #269
Reliefs
Islriz v. Capada, January 31, 2011
 
FACTS: Respondents Efren Capada, Lauro Licup, Norberto Nigos and Godofredo Magnaye were drivers while respondents Ronnie
Abel, Arnel Siberre, Edmundo Capada, Nomerlito Magnaye and Alberto Dela Vega were helpers of Islriz Trading, a gravel and sand
business owned and operated by petitioner Victor Hugo Lu. Claiming that they were illegally dismissed, respondents filed a
Complaint[3] for illegal dismissal and non-payment of overtime pay, holiday pay, rest day pay, allowances and separation
pay against petitioner on August 9, 2000 before the Labor Arbiter.  On his part, petitioner imputed abandonment of work
against respondents. On December 21, 2001, Labor Arbiter rendered judgment declaring respondent ISLRIZ TRADING guilty of
illegal dismissal and ordering respondent to reinstate complainants to their former positions without loss of seniority rights and the
payment of full backwages from date of dismissal to actual reinstatement and Ordering respondent to pay complainants 10% of the
total monetary award as attorney's fees.
ISSUE: W/N employee may collect their wages during the period between the LA order of reinstatement pending appeal and the
NLRC resolution overturning the LA?
RULING: YES. Even if the order of reinstatement of the LA is reversed on appeal, it is obligatory on the part of the employer (ER) to
reinstate and pay the wages of the dismissed employee (EE) during the period of appeal until reversal by the higher court or
tribunal. It is also settled that LA’s order of reinstatement is immediately executory and the employer has to either re-admit
them to work under same terms and conditions prevailing prior to their dismissal, or to reinstate them in the payroll.
Failure to exercise either option in the alternative will esquire the ER to pay the EE’s salaries.  After reversal of LA’s decision,
EE is barred from collecting accrued wages, if it is shown that the delay in enforcing the reinstatement pending appeal was without
fault on the part of the ER.  The test here is twofold: (1) there must be actual delay or the fact that the order of reinstatement
pending appeal was not executed period to its reversal; and (2) the delay must not be due to the ER’s unjustified act or
omission. If the delay is due to the employer’s unjustified refusal, the ER may still be required to pay the salaries
notwithstanding the reversal of the LA’s decision.  Applying the two-fold test in the case at bar, ER failed to reinstate or
effect payroll reinstatement of EE until the decision was overturned--as such there was actual delay of reinstatement.
There was also a finding that the delay is due to the unjustified act or omission of the ER. The Garcia v. PAL doctrine
cannot apply in the case at bar, as Islriz here is not undergoing rehabilitation or any analogous situation which would
justify the non-exercise of the two options (reinstatement or payroll reinstatement).
Tinae
Case No. 270
Reliefs
Lansangan v. Amkor Technology Philippines, January 30, 2009

Facts: An anonymous e-mail was sent to the General Manager of Amkor Technology Philippines detailing allegations of
malfeasance on the part of its supervisory employees Lunesa Lansangan and Rosita Cendaa for "stealing company time." In
handwritten letters, petitioners admitted their wrongdoing. Respondent thereupon terminated petitioners for "extremely serious
offenses" as defined in its Code of Discipline, prompting petitioners to file a complaint for illegal dismissal against it. LA dismissed
petitioners’ complaint finding them guilty of swiping another employees' I.D. card or requesting another employee to swipe one's I.D.
card to gain personal advantage and/or in the interest of cheating, an offense of dishonesty punishable as a serious form of
misconduct and fraud or breach of trust under Article 282 of the LC which allows the dismissal of an employee for a valid cause
moved for the issuance of a writ of reinstatement. The LA, however, ordered the reinstatement of petitioners to their former positions
without backwages. The LA issued an alias writ of execution following which respondent's bank account at Equitable-PCI Bank was
garnished. Respondent moved for the quashal of the alias writ of execution and lifting of the notice of garnishment, which the LA
denied by Order of January 26, 2005, drawing respondent to appeal to the NLRC. The NLRC granted respondent's appeals by
deleting the reinstatement aspect of the Arbiter's decision and setting aside the Arbiter's Alias Writ of Execution and Notice of
Garnishment. Petitioners filed a petition for certiorari before the CA which, by Decision, while affirming the finding that petitioners
were guilty of misconduct and the like, ordered respondent to "pay petitioners their corresponding backwages without qualification
and deduction for the period covering October 20, 2004 (date of the Arbiter's decision) up to June 30, 2005 (date of the NLRC
Decision)," citing Article 223 of the Labor Code and Roquero v. Philippine Airlines.

Issue: Whether the CA erred in limiting the payment of backwages to the petitioners from Oct. 20, 2004 (LA Decision) up to June
30, 2005 (NLRC Decision). 

Ruling: No. The decision of the LA finding that petitioners committed "dishonesty as a form of serious misconduct and fraud, or
breach of trust" had become final, petitioners not having appealed the same before the NLRC as in fact they even moved for the
execution of the reinstatement aspect of the decision. It bears recalling that it was only respondent which assailed the Arbiter's
decision to the NLRC - to solely question the propriety of the order for reinstatement, and it succeeded. Roquero, as well as Article
223 of the Labor Code on which the appellate court also relied, finds no application in the present case. Article 223 concerns itself
with an interim relief, granted to a dismissed or separated employee while the case for illegal dismissal is pending appeal,
as what happened in Roquero. It does not apply where there is no finding of illegal dismissal, as in the present case.
Following Article 279, 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.
TINGKAHAN
CASE NO. 271

RELIEFS
Palteng v. UCPB, February 27, 2009
Facts: Petitioner Elizabeth D. Palteng was the Senior Assistant Manager/Branch Operations Officer of respondent United Coconut
Planters Bank in its Banaue Branch in Quezon City. Area Head and Vice-President Eulallo S. Rodriguez reported to the bank’s
Internal Audit and Credit Review Division that bank client Clariza L. Mercado. After conducting a diligence audit, it was found out
Palteng committed several offenses under the Employee Discipline Code in connection with Mercado’s Past Due Domestic BP. It
also recommended that the matter be referred to the Committee on Employee Discipline for proper disposition. After hearing and
investigation, the committee recommended Palteng’s dismissal. On October 25, 1996, Palteng was dismissed with forfeiture of all
benefits. Palteng filed a complaint for illegal dismissal seeking reinstatement to her former position without loss of seniority rights
with full backwages, or in the alternative, payment of separation pay with full backwages, and recovery of her monetary claims with
damages.
Issue: Whether backwages is proper
Ruling: No. Settled is the rule that an employee who is illegally dismissed from work is entitled to reinstatement without
loss of seniority rights, and other privileges as well as to full backwages. Notably, reinstatement and payment of
backwages are distinct and separate reliefs. The award of one does not bar the other.  In a number of cases, the Court,
despite ordering reinstatement or payment of separation pay in lieu of reinstatement, has not awarded backwages as
penalty for the misconduct or infraction committed by the employee. In the case at bar, petitioner admitted that she granted
the BP accommodation against Mercado’s personal checks beyond and outside her authority. The LA, the NLRC and the Court of
Appeals all found her to have committed an “error of judgment,” “honest mistake,” “honest mistake” vis-à-vis a “major offense.”
Since petitioner was not faultless in regard to the offenses imputed against her, we hold that the award of separation pay only,
without backwages, is proper.
CASE NO. 272
 
EXECUTION; UPDATING OF AWARD
Nacar v. Gallery Frames, August 13, 2013
 
FACTS: Dario Nacar filed a labor case against Gallery Frames and its owner Felipe Bordey, Jr. Nacar alleged that he was
dismissed without cause by Gallery Frames on January 24, 1997. On October 15, 1998, the Labor Arbiter found Gallery Frames
guilty of illegal dismissal hence the Arbiter awarded Nacar P158,919.92 in damages consisting of backwages and separation pay.
Gallery Frames appealed all the way to the Supreme Court which affirmed the decision of the Labor Arbiter and the decision
became final on May 27, 2002. After the finality of the SC decision, Nacar filed a motion before the LA for recomputation as he
alleged that his backwages should be computed from the time of his illegal dismissal (January 24, 1997) until the finality of the SC
decision (May 27, 2002) with interest. The LA denied the motion as he ruled that the reckoning point of the computation should only
be from the time Nacar was illegally dismissed (January 24, 1997) until the decision of the LA (October 15, 1998). The LA reasoned
that the said date should be the reckoning point because Nacar did not appeal hence as to him, that decision became final and
executory.
ISSUE: Whether the Labor Arbiter is correct
RULING: NO. There are two parts of a decision when it comes to illegal dismissal cases (referring to cases where the dismissed
employee wins, or loses but wins on appeal). The first part is the ruling that the employee was illegally dismissed. This is
immediately final even if the employer appeals – but will be reversed if employer wins on appeal. The second part is the ruling on
the award of backwages and/or separation pay. For backwages, it will be computed from the date of illegal dismissal until the
date of the decision of the Labor Arbiter. But if the employer appeals, then the end date shall be extended until the day
when the appellate court’s decision shall become final. Hence, as a consequence, the liability of the employer, if he loses on
appeal, will increase – this is just but a risk that the employer cannot avoid when it continued to seek recourses against the Labor
Arbiter’s decision. This is also in accordance with Article 279 of the Labor Code.
Anent the issue of award of interest in the form of actual or compensatory damages, the SC ruled that the old case of Eastern
Shipping Lines vs CA is already modified by the promulgation of the BSP Monetary Board Resolution No. 796 which lowered the
legal rate of interest from 12% to 6%. 
 
Abisana 273
Wenphil Corporation vs. Abing
G.R. No. 207983 April 7, 2014
 
Facts: Respondents filed a complaint for illegal dismissal for which the LA ruled in their favor and ordered Wenphill to immediately
reinstate respondents whether in actual or in payroll. The LA also ordered that backwages be paid from Feb 3, 2000 until the date of
their actual reinstatement.
On October 29, 2001, the parties entered into a compromise agreement before the LA. Wenphill agreed to the respondents’ payroll
reinstatement while the appeal with the NLRC was ongoing. Wenphil also agreed to pay the accumulated salaries for the payroll
period from April 5, 2001 until October 15, 2001.14 As for the remaining payroll period starting October 16, 2001, Wenphil
committed itself to credit the respective salaries of the respondents to their ATM payroll accounts until such time that the questioned
decision of LA is either modified, amended or reversed by the NLRC. In 2002, the NLRC affirmed the LA’s decision but with
modification. And in 2003, the CA reverse the findings of the NLRC—stating that respondents were guilty of serious misconduct and
this was affirmed by the SC. Respondents now seek a motion for computation and issuance of writ of execution asserting that they
were still entitled to backwages from the time of their dismissal until the NLRC’s decision finding them to be illegally dismissed was
reversed with finality. The LA granted the motion and ordered Wenphil to pay for the period from February 15, 2002 until November
8, 2002.
Petitioners held that the respondents were no longer entitled to payment of backwages in view of the modification of the LA’s ruling
by the NLRC pursuant with their October 29, 2001 compromise agreement.
 
Issue: WON respondents be reinstated and were still entitled to backwages during the period of appeal until the reversal of the
finding of the illegal dismissal
 
Ruling: Yes. We point out that reinstatement and backwages are two separate reliefs available to an illegally dismissed
employee. The normal consequences of a finding that an employee has been illegally dismissed are: first, that the
employee becomes entitled to reinstatement to his former position without loss of seniority rights; and second, the
payment of backwages covers the period running from his illegal dismissal up to his actual reinstatement. These two reliefs
are not inconsistent with one another and the labor arbiter can award both simultaneously.
Though the grant of reinstatement commonly carries with it an award of backwages, the inappropriateness or non-availability of one
does not carry with it the inappropriateness or non-availability of the other. As the term suggests, separation pay is the amount that
an employee receives at the time of his severance from the service and, as correctly noted by the Solicitor General in his Comment,
is designed to provide the employee with "the wherewithal during the period that he is looking for another employment." In the
instant case, the grant of separation pay was a substitute for immediate and continued re-employment with the private
respondent Bank. The grant of separation pay did not redress the injury that is intended to be relieved by the second
remedy of backwages, that is, the loss of earnings that would have accrued to the dismissed employee during the period
between dismissal and reinstatement. Put a little differently, payment of backwages is a form of relief that restores the
income that was lost by reason of unlawful dismissal; separation pay, in contrast, is oriented towards the immediate
future, the transitional period the dismissed employee must undergo before locating a replacement job. It was grievous
error amounting to grave abuse of discretion on the part of the NLRC to have considered an award of separation pay as equivalent
to the aggregate relief constituted by reinstatement plus payment of backwages under Article 280 of the Labor Code. The grant of
separation pay was a proper substitute only for reinstatement; it could not be an adequate substitute both for reinstatement and for
backwages. In effect, the NLRC in its assailed decision failed to give to petitioner the full relief to which she was entitled under the
statute.
The rule in Pfizer is that the period for computing the backwages due to the respondents during the period of appeal
should end on the date that a higher court reversed the labor arbitration ruling of illegal dismissal. In this case, the higher
court which first reversed the NLRC’s ruling was not the SC but rather the CA. In this light, the CA was correct when it
found that that the period of computation should end on August 27, 2003.
Under Article 223 of the Labor Code, "the decision of the Labor Arbiter reinstating a dismissed or separated employee, insofar as the reinstatement aspect is concerned, shall immediately be executory, even pending appeal. The
employee shall either be admitted back to work under the same terms and conditions prevailing prior to his dismissal or separation, or at the option of the employer, merely reinstated in the payroll. The posting of a bond by the

employer shall not stay the execution for reinstatement."

Baute
Case no. 274
 
RELIEF: DUTY TO REINSTATE PENDING APPEAL
Alcantara & Sons v. CA, September 29, 2010
 
Facts: C. Alcantara & Sons, Inc., (the Company) is a domestic corporation engaged in the manufacture and processing of plywood.
Nagkahiusang Mamumuo sa Alsons-SPFL (the Union) is the exclusive bargaining agent of the Company’s rank and file employees.
The other parties to these cases are the Union officers and their striking members. The Company and the Union entered into a CBA
that bound them to hold no strike and no lockout in the course of its life. At some point, the parties began negotiating the economic
provisions of their CBA but this ended in a deadlock, prompting the Union to file a notice of strike. After efforts at conciliation by the
DOLE failed, the Union conducted a strike vote that resulted in an overwhelming majority of its members favoring itThe Company,
on the other hand, filed a petition with the Regional Arbitration Board to declare the Union’s strike illegal, citing its violation of the no
strike, no lockout, provision of their CBA. The Labor Arbiter rendered a decision, declaring the Union’s strike illegal for violating the
CBA’s no strike, no lockout, provision. As a consequence, the Labor Arbiter held that the Union officers should be deemed to have
forfeited their employment with the Company and that they should pay actual damages plus 10% interest and attorney’s fees. With
respect to the striking Union members, finding no proof that they actually committed illegal acts during the strike, the Labor Arbiter
ordered their reinstatement without backwages.
 
At any rate, the Company did not reinstate them. Both parties appealed the Labor Arbiter’s decision to the NLRC. The NLRC
rendered a decision, affirming that of the Labor Arbiter insofar as the latter declared the strike illegal, ordered the Union officers
terminated, and directed them to pay damages to the Company. The NLRC ruled, however, that the Union members involved, who
were identified in the proceedings held in the case, should also be terminated for having committed prohibited and illegal acts.
 
The CA rendered a decision dismissing the petition. The CA ruled that the reinstatement pending appeal provided under Article 223
of the Labor Code contemplated illegal dismissal or termination cases and not cases under Article 263. Thus, the CA ruled that the
resolution ordering the reinstatement of the terminated Union members and the payment of their wages and other benefits had no
basis.
 
Issue: Whether the terminated Union members are entitled to the payment of backwages on account of the Company’s refusal to
reinstate them pending appeal.

Held: Yes. The Company’s failure to reinstate the employees pursuant to the decision of the Labor Arbiter makes it liable for
accrued backwages until the eventual reversal of the order of reinstatement by the National Labor Relations Commission (NLRC).
Although the Labor Arbiter failed to act on the terminated Union members’ motion for reinstatement pending appeal, the Company
had the duty under Article 223 to immediately reinstate the affected employees even if it intended to appeal from the decision
ordaining such reinstatement. The Company’s failure to do so makes it liable for accrued backwages until the eventual reversal of
the order of reinstatement by the NLRC on November 8, 1999, a period of four months and nine days.
 
Briones #275
Consequences of Dismissal
Velasco v. NLRC
2006
Facts: Petitioner Velasco is the owner-manager of Modern Furniture. Private respondent Tayag was hired as a carpenter by
Velasco in1968, while his relatives, co-private respondents were hired. All were paid on a piece-rate basis. According to the Tayags,
in 1998, Velasco started laying off workers due to business losses, albeit with the promise to the dismissed workers that they would
be rehired should the business again prosper. All three filed complaints for illegal dismissal against Petitioner with the NLRC. The
Tayags sought separation pay in lieu of reinstatement, as well as 13th month pay, holiday pay, overtime pay, and exemplary
damages. LA dismissed the complaints for illegal dismissal on the ground that since Velasco had denied terminating the employees
in the first place, the burden fell upon the Tayags to prove by substantial evidence that they were actually terminated. NLRC
reversed the decision of LA. The NLRC found that there was no instance from the evidence adduced wherein Velasco called upon
the Tayags to report for work. From these facts, the NLRC concluded that the Tayags had not reported to the premises simply
because they were not given any work, as in fact they had actually been dismissed. Thus, the NLRC did not agree with the
contention that the Tayags had abandoned work, and concluded instead that they were entitled to separation pay in lieu of
reinstatement. Velasco appealed before CA.  The CA agreed that it was Velasco, as employer, who had the burden to prove that the
termination was for just or authorized causes, and that Velasco had failed to overcome such burden. 
 
Issue: Whether petitioner is entitled for separation pay and backwages?
 
Ruling: YES.  The accepted doctrine is that separation pay may avail in lieu of reinstatement if reinstatement is no longer practical
or in the best interest of the parties. Separation pay in lieu of reinstatement may likewise be awarded if the employee decides not to
be reinstated. It is not controverted that Modern Furniture has undergone financial hardship, and that the Tayags had opted to seek.
separation pay in lieu of reinstatement. Tayags are entitled to full backwages by reason of their illegal dismissal, even though
there’s already an award of separation pay. The grant of separation pays did not redress the injury that is intended to be
relieved by the second remedy of backwages, that is, the loss of earnings that would have accrued to the dismissed
employee during the period between dismissal and reinstatement. Payment of backwages is a form of relief that restores
the income that was lost by reason of unlawful dismissal; separation pay, in contrast, is oriented towards the immediate
future, the transitional period the dismissed employee must undergo before locating a replacement job.
Casumpang
Case No. 276

Consequences of Dismissal; Relief

PCIB v. Abad, February 28, 2005

FACTS: Anastacio Abad was the Senior Assistant Manager of PCIB, Tacloban City, when he was dismissed from work on Aug. 3,
1998. On Mar. 13, 1998, Abad received a memorandum from PCIB concerning the irregular clearing of PNB-Naval Check of Sixtu
Chu, a valued client. Abad denied that he instructed his subordinates to validate the out-of-town checks of Chu presented for
deposit or encashment as local clearing checks. During the investigation conducted by the PCIB, several transactions violative of
the Bank’s Policies and Rules and Regulations were uncovered by the Fact-Finding Committee. Consequently, Lorenzo Cervantes,
Fact-Finding officer, issued another memorandum to Abad asking the latter to explain the newly discovered irregularities. Not
satisfied with the explanations of Abad, PCIB served another memorandum, terminating his employment effective immediately upon
receipt, for loss of trust and confidence. Abad instituted a Complaint for Illegal dismissal against PCIB. The LA ruled that the
dismissal was legal. However, it directed PCIB to pay Abad the amount of P10,000.00 for its failure to comply with the requirements
of due process. The CA sustained the validity of the dismissal but modified the award to separation pay equivalent to ½ month pay
for every year of service in accordance with social justice policy in favor of the working class.

ISSUE: Was the grant of separation pay despite valid dismissal proper?

RULING: YES. The award of separation pay is required for dismissals due to causes specified under Articles 298 (authorized
cause) and 299 (due to disease), as well as for illegal dismissals in which reinstatement is no longer feasible. On the other hand,
an employee dismissed for any of the just causes enumerated under Article 299 is not, as a rule, entitled to separation pay.
As an exception, allowing the grant of separation pay or some other financial assistance to an employee dismissed for just
causes is based on equity and social justice. The Court, in the case of San Miguel v. Lao, made the test on when separation pay
may be awarded. Accordingly, it may be awarded provided that the dismissal does not fall under either of two circumstances:
(1) there was serious misconduct, or
(2) the dismissal reflected on the employees moral character. 
The dismissal in the present case was due to loss of trust and confidence, not serious misconduct. When Abad violated the policy of
the Bank, there was no indication that his actions were perpetrated for his self-interest or for an unlawful purpose. As the facts
indicate, his actions were motivated by a desire to accommodate a valued client of the bank.
ECHEM
CASE NO. 277
RELIEFS
Luna v. Allado Construction, May 30, 2011
 
FACTS: Respondent Allado Construction Co., Inc. is a juridical entity engaged in the construction business; [respondent] Ramon
Allado is the President of the said corporation. Petitioner filed a complaint before the Executive Labor Arbiter Arturo Gamolo, RAB
Branch XI, Davao City, alleging that he was an employee of herein respondents, having been a part of [respondents'] construction
pool of personnel. He had continuously rendered services as a warehouseman and a timekeeper in every construction project
undertaken by respondents. Sometime in the afternoon of November 24, 2001, while at respondents' construction site in Maasim,
Sarangani Province, he was given a travel order dated November 24, 2001 to proceed to respondents' main office in Davao City for
reassignment. Upon arrival at the office of [respondents] on November 26, 2001, he was told by one Marilou Matilano, personnel
manager of [respondents], to sign several sets of "Contract of Project Employment". He refused to sign the said contracts. Because
of his refusal, he was not given a reassignment or any other work. These incidents prompted him to file the complaint. Respondents,
on the other hand, alleged that on November 29, 2001, petitioner applied for a leave of absence until December 6, 2001, which was
granted. Upon expiration of his leave, petitioner was advised to report to the company's project in Kablacan, Sarangani Province.
However, he refused to report to his new assignment and claimed instead that he had been dismissed illegally.
 
ISSUE: Whether employee was illegally dismissed?
 
RULING: No. Judgment is hereby rendered dismissing the action for illegal dismissal but ordering respondent ALLADO
CONSTRUCTION CO., INC. to extend complainant RODOLFO LUNA the amount of P18,000.00 by way of financial assistance to
tide him over during his post-employment with the former. As a general rule, financial assistance is allowed only in instances
where the EE is validly dismissed for causes other than serious misconduct or those reflecting on his moral character.
Also, the Court has ruled before that where there is no dismissal to speak of, an award of financial assistance is not in order. But,
as an exception, financial assistance may be extended as a measure of social justice and exceptional circumstances, and
as an equitable concession. In the case at bar, there appears to be no infraction committed by EE in all his years of service, thus
the financial assistance is only proper.
HABING
CASE NO. 278
CONSEQUENCE OF DISMISSAL 
Villaruel v. Yeo Han Guan

Petitioner alleged that he was employed as a machine operator by Ribonette Manufacturing Company. Petitioner further alleged that
on October 5, 1998, he got sick and was confined in a hospital; on December 12, 1998, he reported for work but was no longer
permitted to go back because of his illness; he asked that respondent allow him to continue working but be assigned a lighter kind of
work but his request was denied; instead, he was offered a sum of P15,000.00 as his separation pay; however, the said amount
corresponds only to the period between 1993 and 1999; petitioner prayed that he be granted separation pay computed from his first
day of employment in June 1963, but respondent refused. Aside from separation pay, petitioner prayed for the payment of service
incentive leave for three years as well as attorney's fees.
 
On the other hand, respondent averred in his Position Paper that petitioner was hired as machine operator from March 1, 1993 until
he stopped working sometime in February 1999 on the ground that he was suffering from illness; after his recovery, petitioner was
directed to report for work, but he never showed up.  Respondent was later caught by surprise when petitioner filed the instant case
for recovery of separation pay. Respondent claimed that he never terminated the services of petitioner and that during their
mandatory conference, he even told the latter that he could go back to work anytime but petitioner clearly manifested that he was no
longer interested in returning to work and instead asked for separation pay.
 
ISSUES
1.Whether petitioner is entitled to separation pay under Art 284 of the Labor Code. NO
2.Whether petitioner is entitled to separation pay on other grounds. YES
 
RULING

1.NO. A plain reading of Art 204 clearly presupposes that it is the employer who terminates the services of the employee found to be
suffering from any disease and whose continued employment is prohibited by law or is prejudicial to his health as well as to the
health of his co-employees. It does not contemplate a situation where it is the employee who severs his or her employment ties.
This is precisely the reason why Section 8, Rule 1, Book VI of the Omnibus Rules Implementing the Labor Code, directs that an
employer shall not terminate the services of the employee unless there is a certification by a competent public health authority that
the disease is of such nature or at such a stage that it cannot be cured within a period of six (6) months even with proper medical
treatment. The following circumstances as proof that respondent did not terminate petitioner's employment: first, the only cause of
action in petitioner's original complaint is that he was "offered a very low separation pay"; second, there was no allegation of illegal
dismissal, both in petitioner's original and amended complaints and position paper; and, third, there was no prayer for reinstatement.

2. The general rule is that an employee who voluntarily resigns from employment is not entitled to separation pay, except when it is
stipulated in the employment contract or CBA, or it is sanctioned by established employer practice or policy. However, the Court, in
a number of cases, has granted financial assistance to separated employees as a measure of social and compassionate justice and
as an equitable concession. Taking into consideration the factual circumstances obtaining in the present case, the Court finds that
petitioner is entitled to this kind of assistance. In the present case, respondent had been employed with the petitioner for almost
twelve (12) years. On February 13, 1996, he suffered from a "fractured left transverse process of fourth lumbar vertebra," while their
vessel was at the port of Yokohama, Japan. After consulting a doctor, he was required to rest for a month. When he was repatriated
to Manila and examined by a company doctor, he was declared fit to continue his work. When he reported for work, petitioner
refused to employ him despite the assurance of its personnel manager. Respondent patiently waited for more than one year to
embark on the vessel as 2ndEngineer, but the position was not given to him, as it was occupied by another person known to one of
the stockholders. Consequently, for having been deprived of continued employment with petitioner's vessel, respondent opted to
apply for optional retirement. In addition, records show that respondent's seaman's book, as duly noted and signed by the captain of
the vessel was marked "Very Good," and "recommended for hire." Moreover, respondent had no derogatory record on file over his
long years of service with the petitioner. Considering all of the foregoing and in line with Eastern, the ends of social and
compassionate justice would be served best if respondent will be given some equitable relief. Thus, the award of P100,000.00 to
respondent as financial assistance is deemed equitable under the circumstances.

JAMDANI-279
Consequences of Dismissal (Relief)
International School v. ISAE, February 5, 2014

FACTS: Evangeline Santos consistently received poor feedbacks from her superior from her teaching of Filipino classes in
International School Manila. She underwent a remediation phase to help her with her deficiencies in teaching. She improved for a
while but later on did not show much promise. Due to her failure to meet the standards set by the School, she was terminated. She
filed a complaint in the Labor Arbiter for illegal dismissal. The Labor Arbiter ruled in her favor saying that her lapses in teaching does
not warrant termination. The NLRC adopted the decision of the Labor Arbiter. The CA affirmed the decision of the NLRC.
ISSUE: Whether SANTOS was validly dismissed due to gross inefficiency?
RULING: YES. The Supreme Court however, ruled that Santos was not illegally dismissed arguing that there are certain
standards of work that needs to be followed. Failure to do comply with these standards may constitute a just cause for
dismissal. The employer has the right to terminate the employment of any person that goes against the interest of the
employer.
Be that as it may, we find that the petitioners had sufficiently proved the charge of gross inefficiency, which warranted the dismissal
of Santos from the School. Contrary to the ruling of the Labor Arbiter, it is not accurate to state that Santos was dismissed by the
School for inefficiency on account of the fact that she was caught only once without a lesson plan. The documentary evidence
submitted by petitioners, the contents of which we laid down in detail in our statement of facts, pointed to the numerous instances
when Santos failed to observe the prescribed standards of performance set by the School in several areas of concern, not the least
of which was her lack of adequate planning for her Filipino classes. Said evidence established that the School administrators
informed Santos of her inadequacies as soon as they became apparent; that they provided constructive criticism of her planning
process and teaching performance; and that regular conferences were held between Santos and the administrators in order to
address the latter’s concerns. In view of her slow progress, the School required her to undergo the remediation phase of the
evaluation process through a Professional Growth Plan. Despite the efforts of the School administrators, Santos failed to show any
substantial improvement in her planning process. Having failed to exit the remediation process successfully, the School was left with
no choice but to terminate her employment.
Lim
Case no. 280
 
Prince Transport v. Garcia, January 12, 2011
Facts: Respondents were hired either as drivers, conductors, mechanics or inspectors, except for respondent Diosdado Garcia
(Garcia), who was assigned as Operations Manager. in addition to their regular monthly income, respondents also received
commissions equivalent to 8 to 10% of their wages; sometime in October 1997, the said commissions were reduced to 7 to 9%; this
led respondents and other employees of PTI to hold a series of meetings to discuss the protection of their interests as employees;
these meetings led petitioner Renato Claros, who is the president of PTI, to suspect that respondents are about to form a union; in
order to block the continued formation of the union, PTI caused the transfer of all union members and sympathizers to one of its
sub-companies, Lubas Transport (Lubas)
Petitioners, on the other hand, denied the material allegations of the complaints contending that herein respondents were no longer
their employees, since they all transferred to Lubas at their own request; petitioners have nothing to do with the management and
operations of Lubas as well as the control and supervision of the latter's employees; Subsequently, the complaints filed by
respondents were consolidated. On October 25, 2000, the Labor Arbiter rendered a Decision. The Labor Arbiter ruled that
petitioners are not guilty of unfair labor practice. Respondents filed a Partial Appeal with the NLRC. NLRC modified the decision of
the labor arbiter. Respondents filed a Motion for Reconsideration, but the NLRC denied it in its Resolution. Respondents then filed a
special civil action for certiorari with the CA assailing the Decision and Resolution of the NLRC. On December 20, 2004, the CA
rendered the herein assailed Decision which granted respondents' petition. The CA ruled that petitioners are guilty of unfair labor
practice; that Lubas is a mere instrumentality, agent conduit or adjunct of PTI. Petitioners filed a Motion for Reconsideration, but the
CA denied it via its Resolution. Hence, the instant petition for review on certiorari.
 
Issue: WON Petitioner committed ULP which entitles reinstatement and backwages to the Respondents?
 
Ruling: YES. The Court agrees with the CA that Lubas is a mere agent, conduit or adjunct of PTI. A settled formulation of the
doctrine of piercing the corporate veil is that when two business enterprises are owned, conducted and controlled by the same
parties, both law and equity will, when necessary to protect the rights of third parties, disregard the legal fiction that these two
entities are distinct and treat them as identical or as one and the same. In the present case, it may be true that Lubas is a single
proprietorship and not a corporation. However, petitioners attempt to isolate themselves from and hide behind the supposed
separate and distinct personality of Lubas so as to evade their liabilities is precisely what the classical doctrine of piercing the veil of
corporate entity seeks to prevent and remedy. Moreover, petitioners failed to refute the contention of respondents that despite the
latters transfer to Lubas of their daily time records, reports, daily income remittances of conductors, schedule of drivers and
conductors were all made, performed, filed and kept at the office of PTI. In fact, respondents identification cards bear the name of
PTI.  The general prayer is broad enough "to justify extension of a remedy different from or together with the specific remedy
sought." In the instant case, aside from their specific prayer for reinstatement, respondents, in their separate complaints, prayed for
such reliefs which are deemed just and equitable. Even without the prayer for a specific remedy, proper relief may be granted by the
court if the facts alleged in the complaint and the evidence introduced so warrant. The court shall grant relief warranted by the
allegations and the proof even if no such relief is prayed for. The prayer in the complaint for other reliefs equitable and just in the
premises justifies the grant of a relief not otherwise specifically prayed for.