Category Archives: Labor Law

BERGONIO v. SOUTH EAST ASIAN AIRLINES, G.R. No. 195227, April 21, 2014

Labor law; Payment of accrued wages despite reversal of decision. An employer, who, despite the Labor Arbiter’s order of reinstatement, did not reinstate the employee during the pendency of the appeal up to the reversal by a higher tribunal may still be held liable for the accrued wages of the employee, i.e., the unpaid salary accruing up to the time the higher tribunal reverses the decision. The rule, therefore, is that an employee may still recover the accrued wages up to and despite the reversal by the higher tribunal. This entitlement of the employee to the accrued wages proceeds from the immediate and self-executory nature of the reinstatement aspect of the LA’s decision.

Exception. By way of exception to the above rule, an employee may be barred from collecting the accrued wages if shown that the delay in enforcing the reinstatement pending appeal was without fault on the part of the employer. To determine whether an employee is thus barred, two tests must be satisfied: (1) actual delay or the fact that the order of reinstatement pending appeal was not executed prior to its reversal; and (2) the delay must not be due to the employer’s unjustified act or omission. Note that under the second test, the delay must be without the employer’s fault. If the delay is due to the employer’s unjustified refusal, the employer may still be required to pay the salaries notwithstanding the reversal of the LA’s decision.

Full text here.

ARABIT, et al., v. JARDINE PACIFIC FINANCE, INC., G.R. No. 181719, April 21, 2014

Labor law; Retrenchment differentiated from redundancy. Retrenchment and redundancy are two different concepts; they are not synonymous; thus, they should not be used interchangeably.

Redundancy exists where the services of an employee are in excess of what is reasonably demanded by the actual requirements of the enterprise. A position is redundant where it is superfluous, and superfluity of a position or positions may be the outcome of a number of factors, such as over hiring of workers, decreased volume of business, or dropping of a particular product line or service activity previously manufactured or undertaken by the enterprise.

Retrenchment, on the other hand, is used interchangeably with the term “lay-off.” It is the termination of employment initiated by the employer through no fault of the employee’s and without prejudice to the latter, resorted to by management during periods of business recession, industrial depression, or seasonal fluctuations, or during lulls occasioned by lack of orders, shortage of materials, conversion of the plant for a new production program or the introduction of new methods or more efficient machinery, or of automation. Simply put, it is an act of the employer of dismissing employees because of losses in the operation of a business, lack of work, and considerable reduction on the volume of his business, a right consistently recognized and affirmed by this Court.

These rulings appropriately clarify that redundancy does not need to be always triggered by a decline in the business. Primarily, employers resort to redundancy when the functions of an employee have already become superfluous or in excess of what the business requires. Thus, even if a business is doing well, an employer can still validly dismiss an employee from the service due to redundancy if that employee’s position has already become in excess of what the employer’s enterprise requires.

Full text here.

RAUL C. COSARE v. BROADCOM ASIA, INC., ET AL., G.R. No. 201298, February 5, 2014

Labor law; When the dispute involves a charge of illegal dismissal, the action may fall under the jurisdiction of the Labor Arbiter upon whose jurisdiction, as a rule, falls termination disputes and claims for damages arising from employer-employee relations as provided in Article 217 of the Labor Code. Consistent with this jurisprudence, the mere fact that Cosare was a stockholder and an officer of Broadcom at the time the subject controversy developed failed to necessarily make the case an intra-corporate dispute.

Corporate officer as distinguished from a regular employee. There are two circumstances which must concur in order for an individual to be considered a corporate officer, as against an ordinary employee or officer, namely: (1) the creation of the position is under the corporation’s charter or by-laws; and (2) the election of the officer is by the directors or stockholders. It is only when the officer claiming to have been illegally dismissed is classified as such corporate officer that the issue is deemed an intra-corporate dispute which falls within the jurisdiction of the trial courts.

Full text here.

WILGEN LOON, ET AL. v. POWER MASTER, INC., ET AL., G.R. NO. 189404, December 11, 2013

Labor Law; Issue of the appeal bond’s validity may be raised for the first time on appeal since its proper filing is a jurisdictional requirement. The requirement that the appeal bond should be issued by an accredited bonding company is mandatory and jurisdictional. The rationale of requiring an appeal bond is to discourage the employers from using an appeal to delay or evade the employees’ just and lawful claims. It is intended to assure the workers that they will receive the money judgment in their favor upon the dismissal of the employer’s appeal.

Labor law; A party may only adduce evidence for the first time on appeal if he adequately explains his delay in the submission of evidence and he sufficiently proves the allegations sought to be proven. In labor cases, strict adherence to the technical rules of procedure is not required. However, this liberal policy should still be subject to rules of reason and fair play.  The liberality of procedural rules is qualified by two requirements: (1) a party should adequately explain any delay in the submission of evidence; and (2) a party should sufficiently prove the allegations sought to be proven. The reason for these requirements is that the liberal application of the rules before quasi-judicial agencies cannot be used to perpetuate injustice and hamper the just resolution of the case. Neither is the rule on liberal construction a license to disregard the rules of procedure.

Full text here.

ROLANDO E. CAWALING v. NAPOLEON M. MENESE ET AL., A.C. No. 9698, November 13, 2013

Labor law; Appeal. The rules are explicit that the filing of a bond for the perfection of an appeal by an employer is mandatory and jurisdictional. It is also imperative that in case of a surety bond, the same shall be issued by a reputable bonding company duly accredited by the Commission or the Supreme Court. The requirement that employers post a cash or surety bond to perfect their appeal is apparently intended to assure workers that if they prevail in the case, they will receive the money judgment in their favor upon the dismissal of the former’s appeal.  If the bond is invalid due to the surety company’s expired accreditation, the purpose of filing of a bond would be defeated.

Labor law; The filing of a supersedeas bond by a surety who no longer has accreditation has no legal bearing. Section 6, Rule VI of the Rules of Procedure of the NLRC provides that “upon the verification by the Commission that the bond is irregular of genuine, the Commission shall cause the immediate dismissal of appeal.”

In the case at bar, at the time of filing of the supersedeas bond on behalf of Bacman, Intra Strata was no longer an accredited surety company as it itself admitted that it was valid only until 31 January 2012. The defense of good faith does not render valid an otherwise invalid bond. Consequently, without an approval of the Court, the bond defeats the purpose of the law to protect the litigants from spurious surety companies.

Full text here.

HECHANOVA BUGAY VILCHEZ LAWYERS ET AL. v. ATTY. LENNY O. MATORRE, G.R. No. 198261, October 16, 2013

Labor law; Employee has the burden of proving that resignation was not voluntary. Petitioner cannot take refuge in the argument that it is the employer who bears the burden of proof that the resignation is voluntary and not the product of coercion or intimidation. Having submitted a resignation letter, it is then incumbent upon her to prove that the resignation was not voluntary but was actually a case of constructive dismissal with clear, positive, and convincing evidence.

30-day notice requirement from resignation is for the benefit of the employer. The 30-day notice requirement for an employee’s resignation is actually for the benefit of the employer who has the discretion to waive such period. Its purpose is to afford the employer enough time to hire another employee if needed and to see to it that there is proper turn-over of the tasks which the resigning employee may be handling. The rule requiring an employee to stay or complete the 30-day period prior to the effectivity of his resignation becomes discretionary on the part of management as an employee who intends to resign maybe allowed a shorter period before his resignation becomes effective.

Full text here.

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MANILA POLO CLUB EMPLOYEES’ UNION (MPCEU) FUR-TUCP v. MANILA POLO CLUB, INC., G.R. No. 172846, July 24, 2013

Labor Law; Summarizing the standards for a valid closure or cessation of business operations. (A) Closure or cessation of operations of establishment or undertaking may either be partial or total. (B) Closure or cessation of operations of establishment or undertaking may or may not be due to serious business losses or financial reverses. However, in both instances, proof must be shown that: (1) it was done in good faith to advance the employer’s interest and not for the purpose of defeating or circumventing the rights of employees under the law or a valid agreement; and (2) a written notice on the affected employees and the DOLE is served at least one month before the intended date of termination of employment. (C) The employer can lawfully close shop even if not due to serious business losses or financial reverses but separation pay, which is equivalent to at least one month pay as provided for by Article 283 of the Labor Code, as amended, must be given to all the affected employees. (D) If the closure or cessation of operations of establishment or undertaking is due to serious business losses or financial reverses, the employer must prove such allegation in order to avoid the payment of separation pay. Otherwise, the affected employees are entitled to separation pay. (E) The burden of proving compliance with all the above-stated falls upon the employer.

Full text here.

ROY D. PASOS v. PHILIPPINE NATIONAL CONSTRUCTION CORPORATION, G.R. No. 192394, July 3, 2013

Labor law; Substantial compliance with the requirements of posting a bond justifies relaxation of the rules on appeal. The perfection of an appeal within the reglementary period and in the manner prescribed by law is jurisdictional, and noncompliance with such legal requirement is fatal and effectively renders the judgment final and executory.  As provided in Article 223 of the Labor Code, as amended, in case of a judgment involving a monetary award, an appeal by the employer may be perfected only upon the posting of a cash or surety bond issued by a reputable bonding company duly accredited by the Commission in the amount equivalent to the monetary award in the judgment appealed from.

However, not only in one case has this Court relaxed this requirement in order to bring about the immediate and appropriate resolution of cases on the merits. In Quiambao v. National Labor Relations Commission, this Court allowed the relaxation of the requirement when there is substantial compliance with the rule.  Likewise, in Ong v. Court of Appeals, the Court held that the bond requirement on appeals may be relaxed when there is substantial compliance with the Rules of Procedure of the NLRC or when the appellant shows willingness to post a partial bond.  The Court held that “[w]hile the bond requirement on appeals involving monetary awards has been relaxed in certain cases, this can only be done where there was substantial compliance of the Rules or where the appellants, at the very least, exhibited willingness to pay by posting a partial bond.”

In the instant case, the Labor Arbiter in his decision ordered PNCC to pay petitioner back wages amounting to P422,630.41 and separation pay of P37,662 or a total of P460,292.41.  When PNCC filed an appeal bond amounting to P422,630.41 or at least 90% of the adjudged amount, there is no question that this is substantial compliance with the requirement that allows relaxation of the rules.

Project employee is deemed regularized if services are extended without specifying duration; While for first three months, petitioner can be considered a project employee of PNCC, his employment thereafter, when his services were extended without any specification of as to the duration, made him a regular employee of PNCC.  And his status as a regular employee was not affected by the fact that he was assigned to several other projects and there were intervals in between said projects since he enjoys security of tenure.

Report of termination required upon project completion. In this case, records clearly show that PNCC did not report the termination of petitioner’s supposed project employment for the NAIA II Project to the DOLE.   Department Order No. 19, or the “Guidelines Governing the Employment of Workers in the Construction Industry,” requires employers to submit a report of an employee’s termination to the nearest public employment office every time an employee’s employment is terminated due to a completion of a project.

Full text here.

PHILIPPINE TRANSMARINE CARRIERS, INC. v. LEANDRO LEGASPI, G.R. No. 202791, June 10, 2013

Labor Law; Finality of NLRC’s decisions, resolutions and orders; Petition for Certiorari, Not Moot. Section 14, Rule VII of the 2011 NLRC Rules of Procedure provides that decisions, resolutions or orders of the NLRC shall become final and executory after ten (10) calendar days from receipt thereof by the parties, and entry of judgment shall be made upon the expiration of the said period. In St. Martin Funeral Home v. NLRC, however, it was ruled that judicial review of decisions of the NLRC may be sought via a petition for certiorari before the CA under Rule 65 of the Rules of Court; and under Section 4 thereof, petitioners are allowed sixty (60) days from notice of the assailed order or resolution within which to file the petition. Hence, in cases where a petition for certiorari is filed after the expiration of the 10-day period under the 2011 NLRC Rules of Procedure but within the 60-day period under Rule 65 of the Rules of Court, the CA can grant the petition and modify, nullify and reverse a decision or resolution of the NLRC.

Accordingly, in this case, although the petition for certiorari was not filed within the 10-day period, petitioner timely filed it before the CA within the 60-day reglementary period under Rule 65. It has, thus, been held that the CA’s review of the decisions or resolutions of the NLRC under Rule 65, particularly those which have already been executed, does not affect their statutory finality.

Xxx in Leonis Navigation, after the NLRC resolution awarding disability benefits became final and executory, the employer paid the monetary award to the employee. The CA dismissed the employer’s petition for certiorari, ruling that the final and executory decisions or resolutions of the NLRC rendered appeals to superior courts moot and academic. This Court disagreed with the CA and held that final and executed decisions of the NLRC did not prevent the CA from reviewing the same under Rule 65 of the Rules of Court. It was further ruled that the employee was estopped from claiming that the case was closed and terminated, considering that the employee’s Acknowledgment Receipt stated that such was without prejudice to the final outcome of the petition for certiorari pending before the CA.

Full text here.

ALPS TRANSPORTATION v. ELPIDIO M. RODRIGUEZ, G.R. No. 186732, June 13, 2013

Labor Law; Remedies of illegally dismissed employees. An illegally dismissed employee is entitled to the twin remedies of reinstatement and payment of full backwages. In Santos v. National Labor Relations Commission, we explained:

The normal consequences of a finding that an employee has been illegally dismissed are, firstly, that the employee becomes entitled to reinstatement to his former position without loss of seniority rights and, secondly, the payment of backwages corresponding to the period from his illegal dismissal up to actual reinstatement. The statutory intent on this matter is clearly discernible. Reinstatement restores the employee who was unjustly dismissed to the position from which he was removed, that is, to his status quo ante dismissal, while the grant of backwages allows the same employee to recover from the employer that which he had lost by way of wages as a result of his dismissal. These twin remedies — reinstatement and payment of backwages — make the dismissed employee whole who can then look forward to continued employment. Thus, do these two remedies give meaning and substance to the constitutional right of labor to security of tenure.

Full text here.