[G.R. No. 118651.

October 16, 1997] These are two interrelated and crucial issues, namely: (1) whether
or not de Jesus was illegally dismissed, and (2) whether or not an
PIONEER TEXTURIZING CORP. and/or JULIANO LIM, order for reinstatement needs a writ of execution.
petitioners, vs. NATIONAL LABOR RELATIONS COMMISSION,
PIONEER TEXTURIZING WORKERS UNION and LOURDES A. Petitioners insist that the NLRC gravely abused its discretion in
DE JESUS, respondents. holding that de Jesus is entitled to reinstatement to her previous
position for she was not illegally dismissed in the first place. In
DECISION support thereof, petitioners quote portions of the NLRC decision
FRANCISCO, J.: which stated that respondent [petitioners herein] cannot be entirely
faulted for dismissing the complaint[3] and that there was no
The facts are as follows:
illegal dismissal to speak of in the case at bar.[4] Petitioners
Private respondent Lourdes A. de Jesus is petitioners further add that de Jesus breached the trust reposed in her, hence
reviser/trimmer since 1980. As reviser/trimmer, de Jesus based her dismissal from service is proper on the basis of loss of
her assigned work on a paper note posted by petitioners. The confidence, citing as authority the cases of Ocean Terminal
posted paper which contains the corresponding price for the work Services, Inc. v. NLRC, 197 SCRA 491; Coca-Cola Bottlers Phil.,
to be accomplished by a worker is identified by its P.O. Number. Inc. v. NLRC, 172 SCRA 751, and Piedad v. Lanao del Norte
On August 15, 1992, de Jesus worked on P.O. No. 3853 by Electric Cooperative,[5] 154 SCRA 500.
trimming the cloths ribs. She thereafter submitted tickets
corresponding to the work done to her supervisor. Three days The arguments lack merit.
later, de Jesus received from petitioners personnel manager a
memorandum requiring her to explain why no disciplinary action The entire paragraph which comprises the gist of the NLRCs
should be taken against her for dishonesty and tampering of decision from where petitioners derived and isolated the
official records and documents with the intention of cheating as aforequoted portions of the NLRCs observation reads in full as
P.O. No. 3853 allegedly required no trimming. The memorandum follows:
also placed her under preventive suspension for thirty days We cannot fully subscribe to the complainants claim that she
starting from August 19, 1992. In her handwritten explanation, de trimmed the ribs of PO3853 in the light of the sworn statement of
Jesus maintained that she merely committed a mistake in trimming her supervisor Rebecca Madarcos (Rollo, p. 64) that no trimming
P.O. No. 3853 as it has the same style and design as P.O. No. was necessary because the ribs were already of the proper length.
3824 which has an attached price list for trimming the ribs and The complainant herself admitted in her sinumpaang salaysay
admitted that she may have been negligent in presuming that the (Rollo, p. 45) that Aking napansin na hindi pantay-pantay ang
same work was to be done with P.O. No. 3853, but not for lapad ng mga ribs PO3853 - mas maigsi ang nagupit ko sa mga
dishonesty or tampering Petitioners personnel department, ribs ng PO3853 kaysa sa mga ribs ng mga nakaraang POs. The
nonetheless, terminated her from employment and sent her a complaint being an experienced reviser/trimmer for almost twelve
notice of termination dated September 18, 1992. (12) years should have called the attention of her supervisor
On September 22, 1992, de Jesus filed a complaint for illegal regarding her observation of PO3853. It should be noted that
dismissal against petitioners. The Labor Arbiter who heard the complainant was trying to claim as production output 447 pieces of
case noted that de Jesus was amply accorded procedural due trimmed ribs of PO3853 which respondents insists that
process in her termination from service. Nevertheless, after complainant did not do any. She was therefore negligent in
observing that de Jesus made some further trimming on P.O. No. presuming that the ribs of PO3853 should likewise be trimmed for
3853 and that her dismissal was not justified, the Labor Arbiter having the same style and design as PO3824. Complainant
held petitioners guilty of illegal dismissal. Petitioners were cannot pass on the blame to her supervisor whom she claimed
accordingly ordered to reinstate de Jesus to her previous position checked the said tickets prior to the submission to the Accounting
without loss of seniority rights and with full backwages from the Department. As explained by respondent, what the supervisor
time of her suspension on August 19, 1992. Dissatisfied with the does is merely not the submission of tickets and do some
Labor Arbiters decision, petitioners appealed to the public checking before forwarding the same to the Accounting
respondent National Labor Relations Commission (NLRC). In its Department. It was never disputed that it is the Accounting
Department who does the detailed checking and computation of
July 21, 1994 decision, the NLRC[1] ruled that de Jesus was the tickets as has been the company policy and practice. Based
negligent in presuming that the ribs of P.O. No. 3853 should on the foregoing and considering that respondent cannot be
likewise be trimmed for having the same style and design as P.O. entirely faulted for dismissing complainant as the complainant
No. 3824, thus petitioners cannot be entirely faulted for dismissing herself was also negligent in the performance of her job, We
de Jesus. The NLRC declared that the status quo between them hereby rule that status quo between them should be maintained as
should be maintained and affirmed the Labor Arbiters order of a matter of course. We thus affirm the decision of Labor Arbiter
reinstatement, but without backwages. The NLRC further directed reinstating the complainant but without backwages. The award of
petitioner to pay de Jesus her back salaries from the date she filed backwages in general are granted on grounds of equity for
her motion for execution on September 21, 1993 up to the date of earnings which a worker or employee has lost due to his illegal
the promulgation of [the] decision.[2] Petitioners filed their partial dismissal. (Indophil Acrylic Mfg. Corporation vs. NLRC, G.R. No.
motion for reconsideration which the NLRC denied, hence this 96488 September 27, 1993) There being no illegal dismissal to
petition anchored substantially on the alleged NLRCs error in speak in the case at bar, the award for backwages should
holding that de Jesus is entitled to reinstatement and back necessarily be deleted.[6]
salaries. On March 6, 1996, petitioners filed its supplement to the
petition amplifying further their arguments. In a resolution dated We note that the NLRCs decision is quite categorical in finding
February 20, 1995, the Court required respondents to comment that de Jesus was merely negligent in the performance of her duty.
thereon. Private respondent de Jesus and the Office of the Such negligence, the Labor Arbiter delineated, was brought about
Solicitor General, in behalf of public respondent NLRC, by the petitioners plain improvidence. Thus:
subsequently filed their comments. Thereafter, petitioners filed two
rejoinders [should be replies] to respondents respective After careful assessment of the allegations and documents
comments. Respondents in due time filed their rejoinders. available on record, we are convinced that the penalty of dismissal
was not justified.
At the outset, it is remarkable that respondents did not deny nor against de Jesus as certainly harsh and grossly disproportionate
dispute that P.O. 3853 has the same style and design as P.O. to the negligence committed, especially where said employee
3824; that P.O. 3824 was made as guide for the work done on P.O. holds a faithful and an untarnished twelve-year service record.
3853; and, most importantly, that the notation correction on P.O. While an employer has the inherent right to discipline its
3824 was made only after the error was discovered by employees, we have always held that this right must always be
respondents Accounting Department. exercised humanely, and the penalty it must impose should be
commensurate to the offense involved and to the degree of its
Be sure that as it may, the factual issue in this case is whether or
not complaint trimmed the ribs of P.O. 3853? infraction.[10] The employer should bear in mind that, in the
exercise of such right, what is at stake is not only the employees
Respondents maintained that she did not because the record in position but her livelihood as well.
Accounting Department allegedly indicates that no trimming is to
be done on P.O. 3853. Basically, this allegation is unsubstantiated. Equally unmeritorious is petitioners assertion that the dismissal is
justified on the basis of loss of confidence. While loss of
It must be emphasized that in termination cases the burdent of confidence, as correctly argued by petitioners, is one of the valid
proof rests upon the employer. grounds for termination of employment, the same, however,
cannot be used as a pretext to vindicate each and every instance
In the instant case, respondents mere allegation that P.O. 3853 of unwarranted dismissal. To be a valid ground, it must shown that
need not be trimmed does not satisfy the proof required to warrant the employee concerned is responsible for the misconduct or
complainants dismissal. infraction and that the nature of his participation therein rendered
Now, granting that the Accounting record is correct, we still believe him absolutely unworthy of the trust and confidence demanded by
that complainant did some further trimming on P.O. 3853 based on his position.[11] In this cae, petitioners were unsuccessful in
the following grounds: establishing their accusations of dishonesty and tampering of
records with intention of cheating. Indeed, even if petitioners
First, Supervisor Rebecca Madarcos who ought to know the work allegations against de Jesus were true, they just the same failed to
to be performed because she was in-charged of assigning jobs, prove that her position needs the continued and unceasing trust of
reported no anomally when the tickets were submitted to her.
her employees functions.[12] Surely, de Jesus who occupies the
Incidentally, supervisor Madarcos testimony is suspect because if position of a reviser/trimmer does not require the petitioners
she could recall what she ordered the complainant to do seven (7) perpetual and full confidence. In this regard, petitioners reliance on
months ago (to revise the collars and plackets of shirts) there was the cases of Ocean Terminal Services, Inc. v. NLRC; Coca-Cola
no reason for her not to detect the alleged tampering at the time Bottlers Phil., Inc. v. NLRC; and Piedad v. Lanao del Norte Electric
complainant submitted her tickets, after all, that was part of her Cooperative, which when perused involve positions that require
job, if not her main job. the employers full trust and confidence, is wholly misplaced. In
Ocean Terminal Services, for instance, the dismissed employee
Secondly, she did not exceed her quota, otherwise she could have was designated as expediter and canvasser whose responsibility
simply asked for more. is mainly to make emergency procurements of tools and
That her output was remarkably big granting misinterpreted it is equipments and was entrusted with the necessary cash for buying
true, is well explained in that the parts she had trimmed were them. The case of Coca-Cola Bottlers, on the other hand,
lesser compared to those which she had cut before. involves a sales agent whose job exposes him to the everyday
financial transactions involving the employers goods and funds,
In this connection, respondents misinterpreted the handwritten while that of Piedad concerns a bill collector who essentially
explanation of the complainant dated 20 August 1992, because handles the employers cash collections. Undoubtedly, the position
the letter never admits that she never trimmed P.O. 3853, on the of a reviser/trimmer could not be equated with that of a canvasser,
contrary the following sentence, sales agent, or a bill collector. Besides, the involved employees in
the three aforementioned cases were clearly proven guilty of
Sa katunayan nakapagbawas naman talaga ako na di ko infractions unlike private respondent in the case at bar. Thus,
inaasahang inalis na pala ang presyo ng Sec. 9 P.O. 3853 na ito. petitioners dependence on these cited cases is inaccurate, to say
the least. More, whether or not de Jesus meets the days quota of
is crystal clear that she did trim the ribs on P.O. 3853. [7]
work she, just the same, is paid the daily minimum wage.[13]
Gleaned either from the Labor Arbiters observations or from the
Corollary to our determination that de Jesus was illegally
NLRCs assessment, it distinctly appears that petitioners
dismissed is her imperative entitlement to reinstatement and
accusation of dishonesty and tampering of official records and
documents with intention of cheating against de Jesus was not backwages as mandated by law.[14] Whence, we move to the
substantiated by clear and convincing evidence. Petitioners simply second issue, i.e., whether or not an order for reinstatement needs
failed, both before the Labor Arbiter and the NLRC, to discharge a writ of execution.
the burdent of proof and to validly justify de Jesus dismissal from
Petitioners theory is that an order for reinstatement is not self-
service. The law, in this light, directs the employers, such as herein
petitioners, not to terminate the services of an employee except for executory. They stress that there must be a writ of execution which
may be issued by the NLRC or by the Labor Arbiter motu proprio
a just or authorized cause under the Labor Code.[8] Lack of a just or on motion of an interested party. They further maintain that even
cause in the dismissal from service of an employee, as in this if a writ of execution was issued, a timely appeal coupled by the
case, renders the dismissal illegal, despite the employers posting of appropriate supersedeas bond, which they did in this
observance of procedural due process.[9] And while the NLRC case, effectively forestalled and stayed execution of the
stated that there was no illegal dismissal to speak of in the case at reinstatement order of the Labor Arbiter. As supporting authority,
bar and that petitioners cannot be entirely faulted therefor, said petitioners emphatically cite and bank on the case of Maranaw
statements are inordinate pronouncements which did not remove Hotel Resort Corporation (Century Park Sheraton Manila) v.
the assailed dismissal from the realm of illegality. Neither can NLRC, 238 SCRA 190.
these pronouncements preclude us from holding otherwise.
Private respondent de Jesus, for her part, maintains that
We also find the imposition of the extreme penalty of dismissal petitioners should have reinstated her immediately after the
decision of the Labor Arbiter ordering her reinstatement was latters salaries. This interpretation is correct. Under Article 223 of
promulgated since the law mandates that an order for the Labor Code, as amended, an employer has two options in
reinstatement is immediately executory. An appeal, she says, order for him to comply with an order of reinstatement, which is
could not stay the execution of a reinstatement order for she could immediately executory, even pending appeal. Firstly, he can admit
either be admitted back to work or merely reinstated in the payroll the dismissed employee back to work under the same terms and
without need of a writ of execution. De Jesus argues that a writ of conditions prevailing prior to his dismissal or separation or to a
execution is necessary only for the enforcement of decisions, substantially equivalent position if the former position is already
orders, or awards which have acquired finality. In effect, de Jesus filled up as we have ruled in Union of Supervisors (RB) NATU vs.
is urging the Court to re-examine the ruling laid down in Maranaw. Sec. of Labor, 128 SCRA 442 [1984]; and Pedroso vs. Castro, 141
SCRA 252 [1986]. Secondly, he can reinstate the employee
Article 223 of the Labor Code, as amended by R.A. No. 6715 merely in the payroll. Failing to exercise any of the above options,
which took effect on March 21, 1989, pertinently provides: the employer can be compelled under pain of contempt, to pay
ART. 223. Appeal. --Decisions, awards, or orders of the Labor instead the salary of the employee. This interpretation is more in
Arbiter are final and executory unless appealed to the Commission consonance with the constitutional protection to labor (Section 3,
by any or both parties within ten (10) calendar days from receipt of Art. XIII, 1987 Constitution). The right of a person to his labor is
such decisions, awards, or orders. Such appeal maybe deemed to be property within the meaning of the constitutional
entertained only on any of the following grounds: guaranty that no one shall be deprived of life, liberty, and property
without due process of law. Therefore, he should be protected
xxx xxx xxx against any arbitrary and unjust deprivation of his job (Bondoc vs.
Peoples Bank and Trust Co., Inc., 103 SCRA 599 [1981]). The
In an event, the decision of the Labor Arbiter reinstating a employee should not be left without any remedy in case the
dismissed or separated employee, insofar as the reinstatement employer unreasonably delays reinstatement. Therefore, we hold
aspect is concerned, shall immediately be executory, even that the unjustified refusal of the employer to reinstate an illegally
pending appeal. The employee shall either be admitted back to dismissed employee entitles the employee to payment of his
work under the same terms and conditions prevailing prior to his
salaries x x x.[21]
dismissal or separation or, at the option of the employer, merely
reistated in the payroll. The posting of a bond by the employer The Court, however, deviated from this construction in the case of
shall not stay the execution for reinstatement provided herein. Maranaw. Reinterpreting the import of Article 223 in Maranaw, the
xxx xxx xxx Court[22] declared that the reinstatement aspect of the Labor
Arbiters decision needs a writ of execution as it is not self-
We initially interpreted the aforequoted provision in Inciong v. executory, a declaration the Court recently reiterated and adopted
NLRC.[15] The Court[16] made this brief comment: in Archilles Manufacturing Corp. v. NLRC.[23]
The decision of the Labor Arbiter in this case was rendered on We note that prior to the enactment of R.A. No. 6715, Article
December 18, 1988, or three (3) months before Article 223 of the
223[24] of the Labor Code contains no provision dealing with the
Labor Code was amended by Republic Act 6715 (which became
law on March 21, 1989), providing that a decision of the Labor reinstatement of an illegally dismissed employee. The amendment
Arbiter ordering the reinstatement of a dismissed or separated introduced by R.A. No. 6715 is an innovation and a far departure
employee shall be immediately executory insofar as the from the old law indicating therby the legislatures unequivocal
reinstatement aspect is concerned, and the posting of an appeal intent to insert a new rule that will govern the reinstatement aspect
bond by the employer shall not stay such execution. Since this of a decision or resolution in any given labor dispute. In fact, the
new law contains no provision giving it retroactive effect (Art. 4, law as now worded employs the phrase shall immediately be
Civil Code), the amendment may not be applied to this case. executory without qualification emphasizing the need for prompt
compliance. As a rule, shall in a statute commonly denotes an
which the Court adopted and applied in Callanta v. NLRC.[17] In imperative obligation and is inconsistent with the idea of
Zamboanga City Water District v. Buat,[18] the Court construed discretion[25] and that the presumption is that the word shall,
Article 223 to mean exactly what it says. We said: when used in a statute, is mandatory.[26] An appeal or posting of
bond, by plain mandate of the law, could not even forestall nor
Under the said provision of law, the decision of the Labor Arbiter stay the executory nature of an order of reinstatement. The law,
reinstating a dismissed or separated employee insofar as the moreover, is unambiguous and clear. Thus, it must be applied
reinstatement aspect is concerned, shall be immediately according to its plain and obvious meaning, according to its
executory, even pending appeal. The employer shall reinstate the express terms. In Globe-Mackay Cable and Radio Corporation v.
employee concerned either by: (a) actually admitting him back to
NLRC,[27] we held that:
work under the same terms and conditions prevailing prior to his
dismissal or separation; or (b) at the option of the employer, Under the principles of statutory construction, if a statute is clear,
merely reinstating him in the payroll. Immediate reinstatement is plain and free from ambiguity, it must be given its literal meaning
mandated and is not stayed by the fact that the employer has and applied without attempted interpretation. This plain-meaning
appealed, or has posted a cash or surety bond pending appeal. rule or verba legis derived from the maxim index animi sermo est
[19] (speech is the index of intention) rests on the valid presumption
that the words employed by the legislature in a statute correctly
We expressed a similar view a year earlier in Medina v. express its intent by the use of such words as are found in the
Consolidated Broadcasting System (CBS) DZWX[20] and laid statute. Verba legis non est recedendum, or from the words of a
down the rule that an employer who fails to comply with an order statute there should be no departure.[28]
of reinstatement makes him liable for the employees salaries.
Thus: And in conformity with the executory nature of the reinstatement
order, Rule V, Section 16 (3) of the New Rules of Procedure of
Petitioners construe the above paragraph to mean that the refusal the NLRC strictly requires the Labor Arbiter to direct the
of the employer to reinstate an employee as directed in an employer to immediately reinstate the dismissed employee.
executory order of reinstatement would make it liable to pay the Thus:
In case the decision includes an order of reinstatement, the Labor herein.
Arbiter shall direct the employer to immediately reinstate the
dismissed or separated employee even pending appeal. The order xxx xxx xxx
of reinstatement shall indicate that the employee shall either be ART. 224. Execution of decisions, orders, or awards. --(a) The
admitted back to work under the same terms and conditions Secretary of Labor and Employment or any Regional Director, the
prevailing prior to his dismissal or separation or, at the option of Commission or any Labor Arbiter, or med-arbiter or voluntary
the employer, merely reinstated in the payroll. arbitrator may, motu propio or on motion of any interested party,
In declaring that reinstatement order is not self-executory and issue a writ of execution on a judgment within five (5) years
needs a writ of execution, the Court, in Maranaw, adverted to the from the date it becomes final and executory, requiring a sheriff
rule provided under Article 224. We said: or a duly deputized officer to execute or enforce final decicions,
orders or awards of the Secretary of Labor and Employment or
It must be stressed, however, that although the reinstatement regional director, the Commission, the arbiter or med-arbiter, or
aspect of the decision is immediately executory, it does not follow voluntary arbitrators. In any case, it shall be the duty of the
that it is self-executory. There must be a writ of execution which responsible officer to separately furnish immediately the counsels
may be issued motu proprio or on motion of an interested party. of record and the parties with copies of said decisions, orders or
Article 224 of the Labor Code provides: awards. Failure to comply with the duty prescribed herein shall
subject such responsible officer to appropriate administrative
ART. 224. Execution of decisions, orders or awards. (a) The sanctions."
Secretary of Labor and Employment or any Regional Director, the
Commission or any Labor Arbiter, or med-arbiter or voluntary Article 224 states that the need for a writ of execution applies only
arbitrator may, motu propio or on motion of any interested party, within five (5) years from the date a decision, an order or
issue a writ of execution on a judgment within five (5) years from awards becomes final and executory. It cannot relate to an
the date it becomes final and executory (emphasis supplied) award or order of reinstatement still to be appealed or pending
appeal which Article 223 contemplates. The provision of Article
The second paragraph of Section 1, Rule VIII of the New Rules of 223 is clear that an award for reinstatement shall be immediately
Procedure of the NLRC also provides: executory even pending appeal and the posting of a bond by
The Labor Arbiter, POEA Administrator, or the Regional Director, or the employer shall not stay the execution for reinstatement.
his duly authorized hearing officer of origin shall, motu propio or The legislative content is quite obvious, i.e., to make an award of
on motion of any interested party, issue a writ of execution on a reinstatement immediately enforceable, even pending appeal. To
judgment within five (5) years from the date it becomes final and require the application for and issuance of a writ of execution as
executory . No motion for execution shall be entertained nor a writ prerequisites for the execution of a reinstatement award would
be issued unless the Labor Arbiter is in possession of the records certainly betray and run counter to the very object and intent of
of the case which shall include an entry of judgment. (emphasis Article 223, i. e., the immediate execution of a reinstatement order.
supplied) The reason is simple. An application for a writ of execution and its
issuance could be delayed for numerous reasons. A mere
xxx xxx xxx continuance or postponement of a scheduled hearing, for
instance, or an inaction on the part of the Labor Arbiter or the
In the absence them of an order for the issuance of a writ of NLRC could easily delay the issuance of the writ thereby setting at
execution on the reinstatement aspect of the decision of the Labor naught the strict mandate and noble purpose envisioned by Article
Arbiter, the petitioner was under no legal obligation to admit back 223. In other words, if the requirements of Article 224 were to
to work the private respondent under the terms and conditions govern, as we so declared in Maranaw, then the executory nature
prevailing prior to her dismissal or, at the petitioners option, to of a reinstatement order or award contemplated by Article 223 will
merely reinstate her in the payroll. An option is a right of election to be unduly circumscribed and rendered ineffectual. In enacting the
exercise a privilege, and the option in Article 223 of the Labor law, the legislature is presumed to have ordaineda valid and
Code is exclusively granted to the employer. The event that gives sensible law, one which operates no further than may be
rise for its exercise is not the reinstatement decree of a Labor necessary to achieve its specific purpose. Statutes, as a rule, are
Arbiter, but the writ for its execution commanding the employer to to be construed in the light of the purpose to be achieved and the
reinstate the employee, while the final act which compels the
employer to exercise the option is the service upon it of the writ of evil sought to be remedied.[30] And where statues are fairly
execution when, instead of admitting the employee back to his susceptible of two or more construction, that construction should
work, the employer chooses to reinstate the employee in the be adopted which will most tend to give effect to the manifest
payroll only. If the employer does not exercise this option, it must intent of the law maker and promote the object for which the
forthwith admit the employee back to work, otherwise it may be statute was enacted, and a construction should be rejected which
would tend to render abortive other provisions of the statute and to
punished for contempt.[29] defeat the object which the legislator sought to attain by its
A closer examination, however, shows that the necessity for a writ enactment.[31] In introducing a new rule on the reinstatement
of execution under Article 224 applies only to final and executory aspect of a labor decision under R.A. No. 6715, Congress should
decisions which are not within the coverage of Article 223. For not be considered to be indulging in mere semantic exercise. On
comparison, we quote the material portions of the subject articles: appeal, however, the appellate tribunal concerned may enjoin or
suspend the reinstatement order in the exercise of its sound
ART. 223. Appeal. x x x discretion.
In any event, the decision of the Labor Arbiter reinstating a Furthermore, the rule is that all doubts in the interpretation and
dismissed or separated employee, insofar as the reinstatement implementation of labor laws should be resolved in favor of labor.
aspect is concerned, shall immediately be executory, even In ruling that an order or award for reinstatement does not require
pending appeal. The employee shall either be admitted back to a writ of execution the Court is simply adhering and giving
work under the same terms and conditions prevailing prior to his meaning to this rule. Henceforth, we rule that an award or order for
dismissal or separation or, at the option of the employer, merely reinstatement is self-executory. After receipt of the decision or
reinstated in the payroll. The posting of a bond by the employer resolution ordering the employee's reinstatement, the employer
shall not stay the execution for reinstatement provided has the right to choose whether to re-admit the employee to work
under the same terms and conditions prevailing prior to his
dismissal or to reinstate the employee in the payroll. In either
instance, the employer has to inform the employee of his choice.
The notification is based on practical considerations for without
notice, the employee has no way of knowing if he has to report for
work or not.
WHEREFORE, the petition is DENIED and the decision of the
Labor Arbiter is hereby REINSTATED.
Costs against petitioner.
SO ORDERED.
[G.R. No. 152329. April 22, 2003] guilty of instigation. It ordered reinstatement to their former
ALEJANDRO ROQUERO, petitioner, vs. PHILIPPINE positions but without backwages.[8] Complainants did not appeal
AIRLINES, INC., respondent. from the decision but filed a motion for a writ of execution of the
order of reinstatement. The Labor Arbiter granted the motion but
DECISION PAL refused to execute the said order on the ground that they
have filed a Petition for Review before this Court.[9] In
PUNO, J.:
accordance with the case of St. Martin Funeral Home vs.
Brought up on this Petition for Review is the decision of the Court
of Appeals dismissing Alejandro Roquero as an employee of the
NLRC and Bienvenido Aricayos,[10] PALs petition was
respondent Philippine Airlines, Inc. referred to the Court of Appeals.[11]

Roquero, along with Rene Pabayo, were ground equipment During the pendency of the case with the Court of Appeals, PAL
mechanics of respondent Philippine Airlines, Inc. (PAL for brevity). and Pabayo filed a Motion to Withdraw/Dismiss the case with
From the evidence on record, it appears that Roquero and Pabayo respect to Pabayo, after they voluntarily entered into a
were caught red-handed possessing and using Methampethamine compromise agreement.[12] The motion was granted in a
Hydrochloride or shabu in a raid conducted by PAL security Resolution promulgated by the Former Thirteenth Division of the
officers and NARCOM personnel.
Court of Appeals on January 29, 2002.[13]
The two alleged that they did not voluntarily indulge in the said act
but were instigated by a certain Jojie Alipato who was introduced The Court of Appeals later reversed the decision of the NLRC and
to them by Joseph Ocul, Manager of the Airport Maintenance reinstated the decision of the Labor Arbiter insofar as it upheld the
Division of PAL. Pabayo alleged that Alipato often bragged about dismissal of Roquero. However, it denied the award of separation
the drugs he could smuggle inside the company premises and pay and attorneys fees to Roquero on the ground that one who
invited other employees to take the prohibited drugs. Alipato was has been validly dismissed is not entitled to those benefits.[14]
unsuccessful, until one day, he was able to persuade Pabayo to
join him in taking the drugs. They met Roquero along the way and The motion for reconsideration by Roquero was denied. In this
he agreed to join them. Inside the company premises, they locked Petition for Review on Certiorari under Rule 45, he raises the
the door and Alipato lost no time in preparing the drugs to be used. following issues:
When they started the procedure of taking the drugs, armed men 1. Whether or not the instigated employee shall
entered the room, arrested Roquero and Pabayo and seized the be solely responsible for an action arising from
drugs and the paraphernalia used.[1] Roquero and Pabayo were the instigation perpetrated by the employer;
subjected to a physical examination where the results showed that
they were positive of drugs. They were also brought to the security 2. Can the executory nature of the decision,
office of PAL where they executed written confessions without the more so the reinstatement aspect of a labor
tribunals order be halted by a petition having
benefit of counsel.[2] been filed in higher courts without any
On March 30, 1994, Roquero and Pabayo received a notice of restraining order or preliminary injunction having
been ordered in the meantime?
administrative charge[3] for violating the PAL Code of Discipline.
They were required to answer the charges and were placed under 3. Would the employer who refused to reinstate
preventive suspension. an employee despite a writ duly issued be held
liable to pay the salary of the subject employee
Roquero and Pabayo, in their reply to notice of administrative from the time that he was ordered reinstated up
charge,[4] assailed their arrest and asserted that they were to the time that the reversed decision was
instigated by PAL to take the drugs. They argued that Alipato was handed down?[15]
not really a trainee of PAL but was placed in the premises to
instigate the commission of the crime. They based their argument I
on the fact that Alipato was not arrested. Moreover, Alipato has no
record of employment with PAL. There is no question that petitioner Roquero is guilty of serious
misconduct for possessing and using shabu. He violated Chapter
In a Memorandum dated July 14, 1994, Roquero and Pabayo 2, Article VII, section 4 of the PAL Code of Discipline which states:
were dismissed by PAL.[5] Thus, they filed a case for illegal Any employee who, while on company premises or on duty, takes
dismissal.[6] or is under the influence of prohibited or controlled drugs, or
In the Labor Arbiters decision, the dismissal of Roquero and hallucinogenic substances or narcotics shall be dismissed.[16]
Pabayo was upheld. The Labor Arbiter found both parties at fault Serious misconduct is defined as the transgression of some
PAL for applying means to entice the complainants into committing established and definite rule of action, a forbidden act, a
the infraction and the complainants for giving in to the temptation dereliction of duty, willful in character, and implies wrongful intent
and eventually indulging in the prohibited activity. Nonetheless, the
Labor Arbiter awarded separation pay and attorneys fees to the and not mere error in judgment.[17] For serious misconduct to
warrant the dismissal of an employee, it (1) must be serious; (2)
complainants.[7] must relate to the performance of the employees duty; and (3)
While the case was on appeal with the National Labor Relations must show that the employee has become unfit to continue
Commission (NLRC), the complainants were acquitted by the working for the employer.[18]
Regional Trial Court (RTC) Branch 114, Pasay City, in the criminal
case which charged them with conspiracy for possession and use It is of public knowledge that drugs can damage the mental
of a regulated drug in violation of Section 16, Article III of Republic faculties of the user. Roquero was tasked with the repair and
Act 6425, on the ground of instigation. maintenance of PALs airplanes. He cannot discharge that duty if
he is a drug user. His failure to do his job can mean great loss of
The NLRC ruled in favor of complainants as it likewise found PAL lives and properties. Hence, even if he was instigated to take
drugs he has no right to be reinstated to his position. He took the cases where the Rules of Court are applied only in a suppletory
drugs fully knowing that he was on duty and more so that it is manner and only to effectuate the objectives of the Labor Code
prohibited by company rules. Instigation is only a defense against and not to defeat them.[25] Hence, even if the order of
criminal liability. It cannot be used as a shield against dismissal reinstatement of the Labor Arbiter is reversed on appeal, it is
from employment especially when the position involves the safety obligatory on the part of the employer to reinstate and pay the
of human lives. wages of the dismissed employee during the period of appeal until
Petitioner cannot complain he was denied procedural due process. reversal by the higher court. On the other hand, if the employee
PAL complied with the twin-notice requirement before dismissing has been reinstated during the appeal period and such
the petitioner. The twin-notice rule requires (1) the notice which reinstatement order is reversed with finality, the employee is not
apprises the employee of the particular acts or omissions for which required to reimburse whatever salary he received for he is
his dismissal is being sought along with the opportunity for the entitled to such, more so if he actually rendered services during
employee to air his side, and (2) the subsequent notice of the the period.
employers decision to dismiss him.[19] Both were given by IN VIEW WHEREOF, the dismissal of petitioner Roquero is
respondent PAL. AFFIRMED, but respondent PAL is ordered to pay the wages to
which Roquero is entitled from the time the reinstatement order
II was issued until the finality of this decision.
Article 223 (3rd paragraph) of the Labor Code,[20] as amended SO ORDERED.
by Section 12 of Republic Act No. 6715,[21] and Section 2 of the
NLRC Interim Rules on Appeals under RA No. 6715, Amending
the Labor Code,[22] provide that an order of reinstatement by the
Labor Arbiter is immediately executory even pending appeal. The
rationale of the law has been explained in Aris (Phil.) Inc. vs.
NLRC:[23]

In authorizing execution pending appeal of the reinstatement

aspect of a decision of the Labor Arbiter reinstating a dismissed or
separated employee, the law itself has laid down a compassionate
policy which, once more, vivifies and enhances the provisions of
the 1987 Constitution on labor and the working man.
xxxxxxxxx
These duties and responsibilities of the State are imposed not so
much to express sympathy for the workingman as to forcefully and
meaningfully underscore labor as a primary social and economic
force, which the Constitution also expressly affirms with equal
intensity. Labor is an indispensable partner for the nations
progress and stability.
xxxxxxxxx
x x x In short, with respect to decisions reinstating employees, the
law itself has determined a sufficiently overwhelming reason for its
execution pending appeal.
xxxxxxxxx
x x x Then, by and pursuant to the same power (police power), the
State may authorize an immediate implementation, pending
appeal, of a decision reinstating a dismissed or separated
employee since that saving act is designed to stop, although
temporarily since the appeal may be decided in favor of the
appellant, a continuing threat or danger to the survival or even the
life of the dismissed or separated employee and his family.
The order of reinstatement is immediately executory. The
unjustified refusal of the employer to reinstate a dismissed
employee entitles him to payment of his salaries effective from the
time the employer failed to reinstate him despite the issuance of a
writ of execution.[24] Unless there is a restraining order issued, it
is ministerial upon the Labor Arbiter to implement the order of
reinstatement. In the case at bar, no restraining order was granted.
Thus, it was mandatory on PAL to actually reinstate Roquero or
reinstate him in the payroll. Having failed to do so, PAL must pay
Roquero the salary he is entitled to, as if he was reinstated, from
the time of the decision of the NLRC until the finality of the
decision of this Court.
We reiterate the rule that technicalities have no room in labor
AIR PHILIPPINES CORPORATION, Petitioner, -versus- 4. Pay attorneys fees equivalent to TEN PERCENT
ENRICO E. ZAMORA, Respondent. (10%) of the total award. (Emphasis supplied)
G.R. NO. 148247 August 7, 2006 SO ORDERED.[7]

Zamora immediately filed a Motion for Execution of the order of

DECISION reinstatement. On November 6, 1998, the Labor Arbiter granted
the motion and issued a writ of execution directing APC to
AUSTRIA-MARTINEZ, J.: reinstate complainant to his former position.[8]
Only those pleadings, parts of case records and documents which Meanwhile, APC filed with the NLRC an appeal assailing the
are material and pertinent, in that they may provide the basis for a finding of the Labor Arbiter that it was liable for constructive
determination of a prima facie case of abuse of discretion, are
required to be attached to a petition for certiorari. A petition lacking dismissal.[9]
such documents contravenes paragraph 2, Section 1, Rule 65 and The NLRC granted the appeal in a Resolution dated February 10,
may be dismissed outright under Section 3, Rule 46. However, if it 1999. It held that no dismissal, constructive or otherwise, took
is shown that the omission has been rectified by the subsequent place for it was Zamora himself who voluntarilly terminated his
submission of the documents required, the petition must be given employment by not reporting for work and by joining a competitor
due course or reinstated, if it had been previously dismissed.[1] Grand Air.[10]
Other pleadings and portions of case records need not accompany
the petition, unless the court will require them in order to aid it in However, upon Motion for Reconsideration[11] filed by Zamora,
its review of the case. Omission of these documents from the the NLRC, in a Resolution dated December 17, 1999, modified its
earlier Resolution, thus:
petition will not warrant its dismissal.[2]
WHEREFORE, the instant Motion for Reconsideration filed by
For being allegedly contrary to the foregoing rule, the Resolutions complainant is DENIED for lack of merit and the appealed decision
dated January 11, 2001 and May 23, 2001 of the Court of Appeals AFFIRMED, while the instant petition for injunction filed by
in CA G.R. SP No. 62388 entitled, Air Philippines Corporation, respondent is GRANTED.
Petitioner, versus, National Labor Relations Commission (5th
Division) and Enrico Zamora, Respondents are sought to be However, respondent Air Philippines Corporation is ordered
annuled in the Petition for Review on Certiorari under Rule 45 that to pay complainant his unpaid salaries and allowances in the
is now before us.[3] total amount of P198,502.30 within fifteen (15) days from
receipt of this resolution.[12] (Emphasis supplied)
The facts are not in dispute.
Displeased with the modification, APC sought a partial
Enrico Zamora (Zamora) was employed with Air Philippines
reconsideration of the foregoing resolution [13] but the NLRC
Corporation (APC) as a B-737 Flight Deck Crew. [4] He applied for denied the same. In its Resolution of October 11, 2000, the NLRC
promotion to the position of airplane captain and underwent the justifed the award of unpaid salaries in this manner:
requisite training program. After completing training, he inquired
about his promotion but APC did not act on it; instead, it continued The grant of salaries and allowances to complainant arose
to give him assignments as flight deck crew. Thus, Zamora filed a from the order of his reinstatement which is executory even
Complaint with the Labor Arbiter. He argued that the act of APC of pending appeal of respondent questioning the same,
withholding his promotion rendered his continued employment with pursuant to Article 223 of the Labor Code. In the eyes of the
it oppressive and unjust. He therefore asked that APC be held law, complainant was as if actually working from the date
liable for constructive dismissal.[5] respondent received the copy of the appealed decision of the
Labor Arbiter directing the reinstatement of complainant based on
APC denied that it dismissed complainant. It pointed out that, his finding that the latter was illegally dismissed from employment.
when the complaint was filed on May 14, 1997, complainant was [14] (Emphasis supplied)
still employed with it. It was only on May 22, 1997 that complainant
stopped reporting for work, not because he was forced to resign, This prompted APC (hereafter referred to as petitioner) to file a
but because he had joined a rival airline, Grand Air.[6] Petition for Certiorari with the Court of Appeals to have the
December 17, 1999 Resolution of the NLRC partially annulled and
In a Decision dated September 16, 1998, the Labor Arbiter ruled in its October 11, 2000 Resolution set aside on the ground that these
favor of Zamora and declared APC liable for constructive were issued with grave abuse of discretion. Petitioner attached to
dismissal. It held: its petition, certified true copies of the Resolutions of the NLRC
dated February 10, 1999, December 17, 1999 and October 11,
WHEREFORE, judgment is hereby rendered finding respondent 2000 and the Decision of the Labor Arbiter dated September 16,
liable for illegal dismissal and ordering the respondent to: 1998, and photocopies of the February 24, 1999 notice of
1. Reinstate complainant to his position as B-737 garnishment, March 11, 1999 Order of the Labor Arbiter
Captain without loss of seniority right immediately upon authorizing Sheriff Fulgencio Lavarez to implement the writ of
receipt thereof (sic); execution, and March 23, 1999 Resolution of the NLRC enjoining
implementation of the writ of execution.[15]
2. Pay complainant his full backwages from May 15,
1997 up to the promulgation of this decision on (sic) the amount of In a Resolution dated January 11, 2001, the Court of Appeals
P1,732,500 (sic); dismissed the petition for failure of petitioner to x x x attach copies
of all pleadings (such complaint, answer, position paper) and other
3. Pay complainant the amount of TWO MILLION material portions of the record as would support the allegations
PESOS (P2,000,000.00) in the concept of moral damages and
therein x x x.[16]
ONE MILLION PESOS (P1,000,000.00) as exemplary damages;
Petitioner filed a Motion for Reconsideration from the said
Resolution and attached to it the pleadings and portions of the SECTION. 1. Petition for certiorari.
case record required by the Court of Appeals.[17] Zamora x x x x
(hereafter referred to as respondent) filed an Opposition to Motion
for Reconsideration.[18] The petition shall be accompanied by a certified true copy of the
judgment, order or resolution subject thereof, copies of all
In a Resolution dated May 23, 2001, the Court of Appeals denied pleadings and documents relevant and pertinent thereto x x x.
the motion for reconsideration, thus:
These requirements are emphasized in Section 3, Rule 46, thus:
Up for consideration is petitioners motion for reconsideration
(pages 64-71 of the Rollo) of this Courts resolution of dismissal SEC. 3. Contents and filing of petition; effect of non-compliance
(page 54, id.), which was promulgated on January 11, 2001. with requirements.
Considering private respondents undisputed comment on xxxx
said motion (pages 159-161. id.), the same is hereby DENIED.
The resolution of dismissal stands.[19] (Emphasis supplied) [The petition] shall be x x x accompanied by a clearly legible
duplicate original or certified true copy of the judgment, order,
And so, herein Petition for Review on Certiorari under Rule 45. resolution, or ruling subject thereof, such material portions of the
Petitioner would have us annul and set aside the January 11, 2001 record as are referred to therein, and other documents relevant or
and May 23, 2001 Resolutions of the Court of Appeals on the pertinent thereto x x x.
following grounds:
xxxx
A. The Honorable Court of Appeals did not rule in accordance with
prevailing laws and jurisprudence when it dismissed the petition The failure of the petitioner to comply with any of the foregoing
for certiorari filed by petitioner APC on the ground that petitioner requirements shall be sufficient ground for the dismissal of the
APC supposedly failed to attach copies of all pleadings (such as petition.
complaint, answer, position papers) and other materials portions of Note that the foregoing rules speak of two sets of documents to be
the record as would support the allegations therein. attached to the petition. The first set consists of certified true
B. The Honorable Court of Appeals did not rule in accordance with copies of the judgment, order or resolution subject of the
prevailing laws and jurisprudence when it denied petitioner APCs petition. Duplicate originals or certified true copies thereof must
motion for reconsideration in spite of the fact that petitioner APC be appended to enable the reviewing court to determine whether
submitted copies of all pleadings and documents mentioned in its the court, body or tribunal, which rendered the same committed
petition for certiorari. grave abuse of discretion.[25] The second set consists of the
pleadings, portions of the case record and other documents
C. The Honorable Court of Appeals did not rule in accordance with
prevailing laws and jurisprudence when it denied petitioner APCs which are material and pertinent to the petition.[26] Mere
motion for reconsideration on a new ground namely, the alleged photocopies thereof may be attached to the petition. [27] It is this
failure of petitioner APC to dispute respondent Zamoras comment second set of documents which is relevant to this case.
and/or opposition to motion for reconsideration (Opposition), in
spite of the fact that (i) the Honorable Court of Appeals did not As a general rule, a petition lacking copies of essential pleadings
order petitioner APC to reply to the said opposition; and (ii) the and portions of the case record may be dismissed.[28] This rule,
said Opposition is patently unmeritorious.[20] however, is not petrified. As the exact nature of the pleadings and
parts of the case record which must accompany a petition is not
Respondent filed his Comment to the petition.[21] specified, much discretion is left to the appellate court to
determine the necessity for copies of pleading and other
We grant the petition. documents. [29] There are, however, guideposts it must follow.
We agree with petitioner on the first and second issues. First, not all pleadings and parts of case records are required to be
In its Resolution of January 11, 2001, the Court of Appeals cited as attached to the petition. Only those which are relevant and
ground for the dismissal of the petition for certiorari its lack of pertinent must accompany it. The test of relevancy is whether the
certified true copies of the pleadings and material portions of the document in question will support the material allegations in the
case record. This is an erroneous ruling, petitioner insists, for the petition, whether said document will make out a prima facie case
deficiency was excusable: pleadings and other portions of the of grave abuse of discretion as to convince the court to give due
case records were not attached to the petition because these course to the petition.[30]
documents had no bearing on the sole issue raised therein, which
was, whether the NLRC committed grave abuse of discretion in Second, even if a document is relevant and pertinent to the
awarding unpaid salaries to respondent despite having adjudged petition, it need not be appended if it is shown that the contents
thereof can also found in another document already attached to
the latter at fault for abandonment of employment.[22] the petition. Thus, if the material allegations in a position paper are
Respondent disagrees. He argues that the requirements under summarized in a questioned judgment, it will suffice that only a
Section 1, Rule 65 are mandatory and jurisdictional; petitioners certified true copy of the judgment is attached.[31]
failure to comply with them was a valid ground for the dismissal of
Third, a petition lacking an essential pleading or part of the case
its petition.[23] record may still be given due course or reinstated (if earlier
Both views are actually correct. dismissed) upon showing that petitioner later submitted the
documents required, [32] or that it will serve the higher interest of
Certiorari, being an extraordinary remedy, the party seeking it
justice that the case be decided on the merits.[33]
must strictly observe the requirements for its issuance.[24] Some
of these requirements are found in paragraph 2, Section 1 of Rule It is readily apparent in this case that the Court of Appeals was
65, which reads: overzealous in its enforcement of the rules.
To begin with, the pleadings and other documents it required of We reiterate the rule that technicalities have no room in labor
petitioner were not at all relevant to the petition. It is noted that the
cases where the Rules of Court are applied only in a suppletory
only issue raised by petitioner was whether the NLRC committed manner and only to effectuate the objectives of the Labor Code
grave abuse of discretion in granting respondent unpaid salaries and not to defeat them.[36][25] Hence, even if the order of
while declaring him guilty of abandonment of employment. reinstatement of the Labor Arbiter is reversed on appeal, it is
Certainly, copies of the Resolutions of the NLRC dated February obligatory on the part of the employer to reinstate and pay the
10, 1999, December 17, 1999 and October 11, 2000 would have wages of the dismissed employee during the period of appeal
sufficed as basis for the Court of Appeals to resolve this issue. until reversal by the higher court. On the other hand, if the
After all, it is in these Resolutions that the NLRC purportedly madeemployee has been reinstated during the appeal period and such
contrary findings. reinstatement order is reversed with finality, the employee is not
There was no need at all for copies of the position papers and required to reimburse whatever salary he received for he is
other pleadings of the parties; these would have only cluttered the entitled to such, more so if he actually rendered services during
docket. Besides, a summary of the material allegations in the the period. [37]
position papers can be found in both the September 16, 1998
Decision of the Labor Arbiter and the February 10, 1999 There is a policy elevated in this ruling. In Aris (Phil.) Inc. v.
Resolution of the NLCR. Quick reference to copies of the decision National Labor Relations Commission, we held:
and resolution would have already satisfied any question the court In short, with respect to decisions reinstating employees, the law
may have had regarding the pleadings of the parties. itself has determined a sufficiently overwhelming reason for its
The attachments of petitioner to its petition for certiorari were execution pending appeal.
already sufficient even without the pleadings and portions of the xxxx
case record. It was therefore unreasonable of the Court of Appeals
to have dismissed it. More so that petitioner later corrected the x x x Then, by and pursuant to the same power (police power), the
purported deficiency by submitting copies of the pleadings and State may authorize an immediate implementation, pending
other documents. appeal, of a decision reinstating a dismissed or separated
employee since that saving act is designed to stop, although
This brings us to the third issue. Again, we agree with petitioner temporarily since the appeal may be decided in favor of the
that the Court of Appeals erred in denying its motion for appellant, a continuing threat or danger to the survival or even the
reconsideration.
life of the dismissed or separated employee and his family.[38]
In its May 23, 2001 Resolution, the Court of Appeals cited as basis
for denying the motion for reconsideration of petitioner from the We cannot do less. The petition for certiorari in CA G.R. SP No.
January 11, 2000 Resolution the latters purported failure to 62388 must be dismissed.
contravene the Opposition filed by respondent.[34] This is WHEREFORE, the petition is GRANTED. The January 11, 2000
certainly a curious ground to deny a motion for reconsideration. As and May 23, 2001 Resolutions of the Court of Appeals are
pointed out by petitioner, a reply to an opposition to a motion for ANNULLED AND SET ASIDE, and the Petition for Certiorari
reconsideration is not filed as a matter of course. An order from docketed as CA G.R. SP No. 62388 is DISMISSED. The
the court may issue though to direct the movant to file a reply. In Resolutions dated December 17, 1999 and October 11, 2000 of
this case, no such order came from the Court of Appeals the National Labor Relations Commission are AFFIRMED.
instructing petitioner to counter the Opposition filed by respondent.
Hence, it cannot be assumed that in failing to file a reply, Costs against petitioner.
petitioner, in effect, conceded to the Opposition of respondent. SO ORDERED.
It is not as if the Opposition which respondent filed required any
answer. The matters discussed therein were not even germane to
the issue raised in the motion for reconsideration. It was as though
respondent passed in silence petitioners arguments against the
January 11, 2000 Resolution. If we are to be technical about it, it
was instead the motion for reconsideration of petitioner which was
not contravened by respondent. It was error on the part of the
Court of Appeals to have denied it.
In sum, we annul and set aside the January 11, 2000 and May 23,
2001 Resolutions of the Court of Appeals. There is no more
obstacle then to the petition for certiorari taking its course.
However, rather than remand it to the Court of Appeals for
resolution, we resolve it here and now to expedite matters.[35]

We hold that the NLRC did not commit grave abuse of discretion in
holding petitioner liable to respondent for P198,502.30.
The premise of the award of unpaid salary to respondent is that
prior to the reversal by the NLRC of the decision of the Labor
Arbiter, the order of reinstatement embodied therein was already
the subject of an alias writ of execution even pending appeal.
Although petitioner did not comply with this writ of execution, its
intransigence made it liable nonetheless to the salaries of
respondent pending appeal. There is logic in this reasoning of the
NLRC. In Roquero v. Philippine Airlines, Inc., we resolved the
same issue as follows:
 I was trying to find means to redeemed [sic] the plan but to no
MILAGROS PANUNCILLO, G.R. No. 161305 avail. I cannot borrow anymore from my creditors because of
outstanding loans which remains unpaid. As of the present, I am
Petitioner, Present: heavily debtladen and I dont know where to run.
I cant blame the person whom I pawned the plan if he had sold it. I
-versus- QUISUMBING, Chairperson, cant redeemed [sic] it anymore. Everybody needs money and
besides, I have given them my papers.
CAP PHILIPPINES, INC., CARPIO, I admit, I had defrauded Ms. J. Pernes, but I didnt do it
CARPIO MORALES, intentionally. At first, I believe I can redeem the plan hoping I can
Respondent. still borrow from somebody.
TINGA, and
With my more than 18 years stay with the company, I dont have
the intention of ruining my image as well as the companys. I think I
VELASCO, JR., JJ.
am just a victim of circumstances.[5] (Emphasis and underscoring
supplied)
Promulgated:
A show-cause memorandum[6] dated February 23, 1999 was
February 9, 2007 thereupon sent to petitioner, giving her 48 hours from receipt
thereof to explain why she should not be disciplinarily dealt with.
Petitioner did not comply, however.
x - - - -x
The IIAO of respondent thus conducted an investigation on the
DECISION
matter. By Memorandum of April 5, 1999,[7] the IIAO
CARPIO MORALES, J.: recommended that, among other things, administrative action
should be taken against petitioner for violating Section 8.4 of
Assailed via Petition for Review[1] are the Decision dated May respondents Code of Discipline reading:
16, 2003[2] and Resolution dated November 17, 2003[3] of the
Committing or dealing any act or conniving with co-employees or
Court of Appeals in CA-G.R. SP No. 74665 which declared valid anybody to defraud the company or customer/sales associates.
the dismissal of Milagros Panuncillo (petitioner) by CAP
Philippines, Inc. (respondent). In the same memorandum, the IIAO reported other matters
bearing on petitioners duties as an employee, to wit:
Petitioner was hired on August 28, 1980 as Office Senior Clerk by
respondent. At the time of her questioned separation from OTHERS:
respondent on April 23, 1999, she was receiving a monthly salary
of P16,180.60. We also received a copy of demand letter of a certain Evelia
Casquejo addressed to Ms. Panuncillo requiring the latter to pay
In order to secure the education of her son, petitioner procured an the amount of P54,870.00 for the supposed transfer of the lapsed
educational plan (the plan) from respondent which she had fully plan of Subscriber Corazon Lintag with SFA # 25-67-40-01-00392.
paid but which she later sold to Josefina Pernes (Josefina) for Ms. Panuncillo received the payment of P25,000.00 and
P37,000. Before the actual transfer of the plan could be effected, P29,870.00 on and respectively (Exhibits L&M).
however, petitioner pledged it for P50,000 to John Chua who,
however, sold it to Benito Bonghanoy. Bonghanoy in turn sold the Ms. Panuncillo verbally admitted that she was the one who sold
plan to Gaudioso R. Uy for P60,000. the plan to Ms. Casquejo but with the authorization from Ms.
Lintag. However, the transfer was not effected because she had
Having gotten wind of the transactions subsequent to her misappropriated a portion of the money until the plan was
purchase of the plan, Josefina, by letter of February 10, 1999, [4] terminated. Ms. Casquejo, however, did not file a complaint
informed respondent that petitioner had swindled her but that she because Ms. Panuncillo executed a Special Power of Attorney
was willing to settle the case amicably as long as petitioner pay authorizing the former to receive P68,000 of Ms. Panuncillos
the amount involved and the interest. She expressed her retirement pay (Exhibit N).[8] (Emphasis in the original;
appreciation if [respondent] could help her in anyway. underscoring supplied))
Acting on Josefinas letter, the Integrated Internal Audit Operations On April 7, 1999, another show-cause memorandum was sent to
(IIAO) of respondent required petitioner to explain in writing why petitioner by Renato M. Daquiz (Daquiz), First Vice President of
the plan had not been transferred to Josefina and was instead sold respondent, giving her another 48 hours to explain why she should
to another. Complying, petitioner proffered the following not be disciplinarily dealt with in connection with the complaints of
explanation: Josefina and Evelia Casquejo (Evelia). Complying with the
directive, petitioner, by letter of April 10, 1999, on top of reiterating
Because of extreme need of money, I was constrained to sell my her admission of having defrauded Josefina, admitted having
CAP plan of my son to J. Pernes last July, 1996, in the amount of received from Evelia the payment for a lapsed plan, thus:
Thirty Seven Thousand Pesos (P37,000.) The plan was not
transferred right away because of lacking requirement on the part With regards to [Evelias] case, yes its [sic] true I had received the
of the buyer (birth certificate). The birth certificate came a month payment but it was accordingly given to the owner or Subscriber
later. While waiting for the birth certificate, again because of Ms. C. Lintag. The plan was not transferred because it was
extreme need of money, I was tempted to pawned [sic] the plan, already forfeited and we, Ms. Lintag, [Evelia] and I already made
believing I can redeemed [sic] it later when the birth certificate will settlement of the case.
come.
I think I have violated Sec. 8.4 of the companys Code of
Last year, I was already pressured by J. Pernes for the transfer of Discipline. I admit it is my wrongdoing. I was only forced to do
the plan. But before hand, she already knew the present situation. this because of extreme needs to pay for my debts. I am open for
whatever disciplinary action that will be sanctioned againts month pay, service incentive leave pay, damages and attorneys
[sic] me. I hope it is not termination from my job. How can I fees against respondent.
pay for obligations if that will happen to me.
The Labor Arbiter, while finding that the dismissal was for a valid
As for [Josefina], I have the greatest desire to pay for my cause, found the same too harsh. He thus ordered the
indebtedness but my capability at the moment is nil. (space) I have reinstatement of petitioner to a position one rank lower than her
been planning to retire early just to pay my obligations. That is why previous position, and disposed as follows:
I had written to you last year inquiring tax exemption when retiring.
I have been with the company for almost 19 years already and I WHEREFORE, the foregoing considered, judgement [sic] is
never intend [sic] to smear its name as well as mine. I was only hereby rendered directing the respondent to pay complainants
forced by circumstances. Although it hurts to leave CAP, I will be 13th Month pay and Service Incentive Leave Pay for 1999 in
retiring on . proportionate amount computed as follows:

x x x x[9] (Emphasis and underscoring supplied) 13th Month Pay

to
Respondent thereupon terminated the services of petitioner = 3 months
by Memorandum dated April 20, 1999.[10] = P16,180.60/12 mos. x 3 mos. P4,045.14
Service Incentive Leave
Petitioner sought reconsideration of her dismissal, by letter of April = P16,180.60/26 days
23, 1999 addressed to Daquiz, imploring as follows: =P622.30 per day x 5 days/12 months. 777.87
TOTAL --------------------------------P4,823.01
. . . Please consider my retirement letter I sent to you. I would like Plus P482.30 ten (10%) Attorneys Fees or a total aggregate
to avail [of] the retirement benefit of the company. The proceeds of amount of PESOS: FIVE THOUSAND THREE HUNDRED
my retirement could help me pay some of my obligations as well FIVE & 31/100 (P5,305.31).
as the needs of my family. My husband is jobless and I am the
breadwinner of the family. If I will be terminated, I dont know what Respondent is likewise, directed to reinstate the
will happen to us. complainant to a position one rank lower without
Sir, I am enclosing the affidavit of Ms. Evelia Casquejo proving that backwages.[15] (Underscoring supplied)
we have already settled the case. On appeal, the National Labor Relations Commission (NLRC), by
Decision of October 29, 2001, reversed that of the Labor Arbiter, it
x x x x[11] (Underscoring supplied) finding that petitioners dismissal was illegal and accordingly
Pending resolution of petitioners motion for reconsideration, ordering her reinstatement to her former position. Thus it
disposed:
respondent received a letter dated April 28, 1999[12] from one
Gwendolyn N. Dinoro (Gwendolyn) who informed that she had WHEREFORE, the Decision in the main case dated February 18,
been paying her quarterly dues through petitioner but found out 2000 of the Labor Arbiter declaring the dismissal of the
that none had been remitted to respondent, on account of which complainant valid, and his Order dated June 26, 2000 declaring
she (Gwendolyn) was being penalized with interest charges. the Motion to Declare Respondent-appellant in Contempt as
prematurely filed and ordering the issuance of an alias writ of
Acting on petitioners motion for reconsideration, Daquiz, by letter- execution are hereby SET ASIDE, and a new one is rendered
memorandum of May 5, 1999, denied the same in this wise: DECLARING the dismissal of the complainant illegal, and
A review of your case was made per your request, and we note ORDERING the respondent, CAP PHILIPPINES,
that it was not just a single case but multiple cases, that of Ms. INCORPORATED, the following:
Casquejo, Ms. Pernes, and newly reported Ms. Dinoro. 1. to reinstate the complainant MILAGROS B. PANUNCILLO to
Furthermore, the cases happened way back in July 1996 and her former position without loss of seniority rights and with full
1997, and were just discovered recently. In addition, the backwages from the date her compensation was withheld from her
misappropriation of money/or act to defraud the company or on April 20, 1999 until her actual reinstatement;
customer was deliberate and intentional. There were several
payments received over a period of time. While you plead for your 2. to pay to the same complainant P4,045.14 as 13th month pay,
retirement benefit to help you pay some of your obligations, as and P777.89 as service incentive leave pay;
well as the need of your family (your husband being jobless and
being the breadwinner), these thoughts should have crossed your 3. to pay to the same complainant moral damages of FIFTY
mind before you committed the violations rather than now. To THOUSAND PESOS (P50,000.00), and exemplary damages of
allow you to retire with benefits, is to tolerate and encourage another FIFTY THOUSAND PESOS (P50,000.00);
others to do the same in the future, as it will be a precedent that
4. to pay attorneys fees equivalent to ten percent (10%) of the total
will surely be invoked in similar situations in the future, as it will be
award exclusive of moral and exemplary damages.
a precedent that will surely be invoked in similar situations in the
future. It is also unfair to others who do their jobs faithfully and Further, the complainants Motion to Declare Respondent in
honestly. If we let you have your way, it will appear that we let Contempt dated is denied and rendered moot by virtue of this
you scot-free and even reward you with retirement someone Decision.
who deliberately violated trust and confidence of the
company and customers. All other claims are dismissed for lack of merit.[16] (Underscoring
supplied)
Premises considered, the decision to terminate your services for
cause stays and the request for reconsideration is denied. In so deciding, the NLRC held that the transaction between
petitioner and Josefina was private in character and, therefore,
x x x x[13] (Emphasis and underscoring supplied) respondent did not suffer any damage, hence, it was error to apply
Section 8.4 of respondents Code of Discipline.
Petitioner thus filed a complaint [14] for illegal dismissal, 13th
Respondent challenged the NLRC Decision before the appellate the cash payments she had made to her, a complaint she was
court via Petition for Certiorari. [17] By Decision of May 16, 2003, apprised of but on which she was silent.
[18] the appellate court reversed the NLRC Decision and held In fine, by petitioners repeated violation of Section 8.4 of
that the dismissal was valid and that respondent complied with the respondents Code of Discipline, she violated the trust and
procedural requirements of due process before petitioners confidence of respondent and its customers. To allow her to
services were terminated. continue with her employment puts respondent under the risk of
being embroiled in unnecessary lawsuits from customers
Hence, the present petition, petitioner faulting the appellate court similarly situated as Josefina, et al. Clearly, respondent exercised
I its management prerogative when it dismissed petitioner.

x x x IN REVIEWING THE FINDINGS OF FACT OF THE LABOR . . . [T]ime and again, this Court has upheld a companys
ARBITER AND THE NATIONAL LABOR RELATIONS management prerogatives so long as they are exercised in good
COMMISSION THAT RESPONDENT CAP PHILIPPINES, INC., faith for the advancement of the employers interest and not for
HAS NOT BEEN DEFRAUDED NOR DAMAGED IN THE the purpose of defeating or circumventing the rights of the
TRANSACTION/S ENTERED INTO BY PETITIONER RELATING employees under special laws or under valid agreements.
TO HER FULLY PAID EDUCATIONAL PLAN. Deliberate disregard or disobedience of rules by the employees
II cannot be countenanced. Whatever maybe the justification behind
the violations is immaterial at this point, because the fact still
x x x IN HOLDING THAT RESPONDENT CAP PHILIPPINES, INC. remains that an infraction of the company rules has been
IS THE INSURER OF PETITIONERS FULLY PAID committed.
EDUCATIONAL PLAN UNDER THE INSURANCE CODE.
Under the Labor Code, the employer may terminate an
III employment on the ground of serious misconduct or willful
disobedience by the employee of the lawful orders of his employer
x x x IN HOLDING THAT PETITIONER WAS DULY AFFORDED or representative in connection with his work. Infractions of
DUE PROCESS BEFORE DISMISSAL[,] company rules and regulations have been declared to belong to
and maintaining that she this category and thus are valid causes for termination of
employment by the employer.
IV
xxxx
x x x IS ENTITLED TO HER FULL BACKWAGES FROM THE
DATE HER COMPENSATION WAS WITHHELD FROM HER ON The employer cannot be compelled to continue the employment of
APRIL 20, 1999 PURSUANT TO THE DECISION OF THE NLRC a person who was found guilty of maliciously committing acts
REINSTATING HER TO HER PREVIOUS POSITION WITH FULL which are detrimental to his interests. It will be highly prejudicial to
BACKWAGES AND SETTING ASIDE THE DECISION OF THE the interests of the employer to impose on him the charges that
LABOR ARBITER REINSTATING HER TO A POSITION NEXT warranted his dismissal from employment. Indeed, it will
RANK, UNTIL THE REVERSAL OF THE NLRC DECISION BY demoralize the rank and file if the undeserving, if not undesirable,
remain in the service. It may encourage him to do even worse and
THE HONORABLE COURT OF APPEALS.[19] (Emphasis and will render a mockery of the rules of discipline that employees are
underscoring supplied) required to observe. This Court was more emphatic in holding that
The petition is not meritorious. in protecting the rights of the laborer, it cannot authorize the
oppression or self-destruction of the employer.[21] x x x
Whether respondent did not suffer any damage resulting from the (Underscoring supplied)
transactions entered into by petitioner, particularly that with
Josefina, is immaterial. As Lopez v. National Labor Relations Petitioner nevertheless argues that she was not afforded
Commission instructs: due process before her dismissal as she was merely required to
answer a show-cause memorandum dated April 7, 1999 and
That the [employer] suffered no damage resulting from the acts there was no actual investigation conducted in which she could
of [the employee] is inconsequential. In Glaxo Wellcome have been heard.
Philippines, Inc. v. Nagkakaisang Empleyado ng Wellcome-DFA
(NEW-DFA), we held that deliberate disregard or disobedience of Before terminating the services of an employee, the law requires
company rules could not be countenanced, and any justification two written notices: (1) one to apprise him of the particular acts
that the disobedient employee might put forth would be deemed or omissions for which his dismissal is sought; and (2) the other
inconsequential. The lack of resulting damage was unimportant, to inform him of his employers decision to dismiss him. As to the
because the heart of the charge is the crooked and anarchic requirement of a hearing, the essence of due process lies in an
attitude of the employee towards his employer. Damage opportunity to be heard, and not always and indispensably in an
aggravates the charge but its absence does not mitigate nor actual hearing.[22]
negate the employees liability. x x x[20] (Italics in the original;
underscoring supplied) When respondent received the letter-complaint of Josefina,
petitioner was directed to comment and explain her side thereon.
The transaction with Josefina aside, there was this case of She did comply, by letter of February 22, 1999 wherein she
misappropriation by petitioner of the amounts given to her by admitted that she had defrauded Ms. J. Pernes, but [that she]
Evelia representing payment for the lapsed plan of Corazon didnt do it intentionally.
Lintag. While a settlement of the case between the two may have
eventually been forged, that did not obliterate the Respondent subsequently sent petitioner a show-cause
misappropriation committed by petitioner against a client of memorandum giving her 48 hours from receipt why she should
respondent. not be disciplinarily sanctioned. Despite the 48-hour deadline,
nothing was heard from her until April 10, 1999 when she
Additionally, there was still another complaint lodged before complied with the second show-cause memorandum dated April
respondent by Gwendolyn against petitioner for failure to remit 7, 1999.
On April 20, 1999, petitioner was informed of the termination of formerly held.[28]
her services to which she filed a motion for reconsideration.
Now, on petitioners argument that, following the third
There can thus be no doubt that petitioner was given paragraph of Article 223 of the Labor Code, the order of the
ample opportunity to explain her side. Parenthetically, when an NLRC to reinstate her and to pay her wages was immediately
employee admits the acts complained of, as in petitioners case, executory even while the case was on appeal before the higher
no formal hearing is even necessary.[23] courts: The third paragraph of Article 223 of the Labor Code
directs that the decision of the Labor Arbiter reinstating a
Finally, petitioner argues that even if the order of reinstatement of dismissed or separated employee, insofar as the reinstatement
the NLRC was reversed on appeal, it is still obligatory on the part aspect is concerned, shall immediately be executory, even
of an employer to reinstate and pay the wages of a dismissed pending appeal.
employee during the period of appeal, citing Roquero v.
Philippine Airlines,[24] the third paragraph of Article 223[25] of In Roquero, the Labor Arbiter upheld the dismissal of Roquero,
along with another employee, albeit he found both the two and
the Labor Code, and the last paragraph of Section 16, [26] Rule employer Philippine Airlines (PAL) at fault. The Labor Arbiter thus
V of the then 1990 New Rules of Procedure of the NLRC. ordered the payment of separation pay and attorneys fees to
Petitioner adds that respondent made clever moves to frustrate the complainant. No order for reinstatement was issued by the
[her] from enjoying the reinstatement aspect of the decision Labor Arbiter, precisely because the dismissal was upheld.
starting from that of the Labor Arbiter (although to a next lower On appeal, the NLRC ruled in favor of Roquero and his
rank), [to that] of the NLRC to her previous position without loss co-complainant as it also found PAL guilty of instigation. The
of seniority rights until it was caught up by the decision of the NLRC thus ordered the reinstatement of Roquero and his co-
Honorable Court of Appeals reversing the decision of the NLRC complainant to their former positions, but without backwages.
and declaring the dismissal of petitioner as based on valid
grounds. PAL appealed the NLRC decision via Petition for Review
before this Court. Roquero and his co-complainant did not. They
Respondent, on the other hand, maintains that Roquero and the instead filed before the Labor Arbiter a Motion for Execution of
legal provisions cited by petitioner are not applicable as they the NLRC order for their reinstatement which the Labor Arbiter
speak of reinstatement on order of the Labor Arbiter and not of granted.
the NLRC.
Acting on PALs Petition for Review, this Court referred it
The Labor Arbiter ordered the reinstatement of petitioner to a to the Court of Appeals pursuant to St. Martin Funeral Home v.
lower position. The third paragraph of Article 223 of the Labor
Code is clear, however the employee, who is ordered reinstated, NLRC.[29]
must be accepted back to work under the same terms and The appellate court reversed the NLRC decision and
conditions prevailing prior to his dismissal or separation. ordered the reinstatement of the decision of the Labor Arbiter
Petitioners being demoted to a position one rank lower but only insofar as it upheld the dismissal of Roquero.
than her original position is certainly not in accordance with the Back to this Court on Roqueros Petition for Review, the
said third paragraph provision of Article 223. Besides, the following material issues were raised:
provision contemplates a finding that the employee was illegally
dismissed or there was no just cause for her dismissal. As priorly xxxx
stated, in petitioners case, the Labor Arbiter found that there was
just cause for her dismissal, but that dismissal was too harsh, 2. Can the executory nature of the decision, more so the
hence, his order for her reinstatement to a lower position. reinstatement aspect of a labor tribunals order be halted by a
petition having been filed in higher courts without any restraining
The order to reinstate is incompatible with a finding that order or preliminary injunction having been ordered in the
the dismissal is for a valid cause. Thus this Court declared in meantime?
Colgate Palmolive Philippines, Inc. v. Ople:
3. Would the employer who refused to reinstate an employee
The order of the respondent Minister to reinstate the employees despite a writ duly issued be held liable to pay the salary of the
despite a clear finding of guilt on their part is not in conformity subject employee from the time that he was ordered reinstated up
with law. Reinstatement is simply incompatible with a finding to the time that the reversed decision was handed down?[30]
of guilt. Where the totality of the evidence was sufficient to
warrant the dismissal of the employees the law warrants their Resolving these issues, this Court held in Roquero:
dismissal without making any distinction between a first offender
and a habitual delinquent. Under the law, respondent Minister is Article 223 (3rd paragraph) of the Labor Code as amended by
duly mandated to equally protect and respect not only the labor Section 12 of Republic Act No. 6715, and Section 2 of the NLRC
or workers side but also the management and/or employers side. Interim Rules on Appeals under RA No. 6715, Amending the
The law, in protecting the rights of the laborer, authorizes neither Labor Code, provide that an order of reinstatement by the Labor
oppression nor self-destruction of the employer. x x x As stated Arbiter is immediately executory even pending appeal. The
by Us in the case of San Miguel Brewery vs. National Labor rationale of the law has been explained in Aris (Phil.) Inc. vs.
Union, an employer cannot legally be compelled to continue with NLRC:
the employment of a person who admittedly was guilty of
In authorizing execution pending appeal of the reinstatement
misfeasance or malfeasance towards his employer, and whose
aspect of a decision of the Labor Arbiter reinstating a dismissed or
continuance in the service of the latter is patently inimical to his
separated employee, the law itself has laid down a compassionate
interest.[27] (Emphasis and underscoring supplied) policy which, once more, vivifies and enhances the provisions of
the 1987 Constitution on labor and the working man.
The NLRC was thus correct when it ruled that it was
erroneous for the Labor Arbiter to order the reinstatement of xxxx
petitioner, even to a position one rank lower than that which she
These duties and responsibilities of the State are imposed not so
much to express sympathy for the workingman as to forcefully and Unlike then the order for reinstatement of a Labor Arbiter which is
meaningfully underscore labor as a primary social and economic self-executory, that of the NLRC is not. There is still a need for the
force, which the Constitution also expressly affirms with equal issuance of a writ of execution. Thus this Court held in Pioneer
intensity. Labor is an indispensable partner for the nations Texturizing Corp. v. NLRC:[32]
progress and stability.
x x x The provision of Article 223 is clear that an award
xxxx [by the Labor Arbiter] for reinstatement shall be immediately
The order of reinstatement is immediately executory. The executory even pending appeal and the posting of a bond by the
unjustified refusal of the employer to reinstate a dismissed employer shall not stay the execution for reinstatement. The
employee entitles him to payment of his salaries effective from the legislative intent is quite obvious, i.e., to make an award of
time the employer failed to reinstate him despite the issuance of reinstatement immediately enforceable, even pending appeal. To
a writ of execution. Unless there is a restraining order issued, it require the application for and issuance of a writ of execution as
is ministerial upon the Labor Arbiter to implement the order of prerequisites for the execution of a reinstatement award would
reinstatement. In the case at bar, no restraining order was granted. certainly betray and run counter to the very object and intent of
Thus, it was mandatory on PAL to actually reinstate Roquero or Article 223, i.e., the immediate execution of a reinstatement
reinstate him in the payroll. Having failed to do so, PAL must pay order. The reason is simple. An application for a writ of execution
Roquero the salary he is entitled to, as if he was reinstated, from and its issuance could be delayed for numerous reasons. A mere
the time of the decision of the NLRC until the finality of the continuance or postponement of a scheduled hearing, for
decision of this Court. instance, or an inaction on the part of the Labor Arbiter or the
NLRC could easily delay the issuance of the writ thereby setting
We reiterate the rule that technicalities have no room in labor at naught the strict mandate and noble purpose envisioned by
cases where the Rules of Court are applied only in a suppletory Article 223. In other words, if the requirements of Article 224
manner and only to effectuate the objectives of the Labor Code [including the issuance of a writ of execution ] were to govern,
and not to defeat them. Hence, even if the order of reinstatement as we so declared in Maranaw, then the executory nature of a
of the Labor Arbiter is reversed on appeal, it is obligatory on the reinstatement order or award contemplated by Article 223 will
part of the employer to reinstate and pay the wages of the be unduly circumscribed and rendered ineffectual. In enacting
dismissed employee during the period of appeal until reversal the law, the legislature is presumed to have ordained a valid and
by the higher court. On the other hand, if the employee has been sensible law, one which operates no further than may be
reinstated during the appeal period and such reinstatement order necessary to achieve its specific purpose. Statutes, as a rule, are
is reversed with finality, the employee is not required to to be construed in the light of the purpose to be achieved and the
reimburse whatever salary he received for he is entitled to such, evil sought to be remedied. x x x In introducing a new rule on the
more so if he actually rendered services during the period.[31] reinstatement aspect of a labor decision under Republic Act No.
(Italics in the original, emphasis and underscoring supplied) 6715, Congress should not be considered to be indulging in
mere semantic exercise. On appeal, however, the appellate
In the present case, since the NLRC found petitioners tribunal concerned may enjoin or suspend the reinstatement
dismissal illegal and ordered her reinstatement, following the order in the exercise of its sound discretion.[33] (Italics in the
provision of the sixth paragraph of Article 223, viz: original, emphasis and underscoring supplied)
The [National Labor Relations] Commission shall decide If a Labor Arbiter does not issue a writ of execution of the
all cases within twenty (20) calendar days from receipt of the NLRC order for the reinstatement of an employee even if there is
answer of the appellee. The decision of the Commission shall no restraining order, he could probably be merely observing
be final and executory after ten (10) calendar days from receipt judicial courtesy, which is advisable if there is a strong probability
thereof by the parties. (Emphasis and underscoring supplied), that the issues before the higher court would be rendered moot
the NLRC decision became final and executory after ten and moribund as a result of the continuation of the proceedings
calendar days from receipt of the decision by the parties for in the lower court.[34] In such a case, it is as if a temporary
reinstatement. restraining order was issued, the effect of which Zamboanga City
Water District v. Buhat explains:
In view, however, of Article 224 of the Labor Code which
provides: The issuance of the temporary restraining order did not
nullify the rights of private respondents to their
ART. 224. Execution of decisions, orders or awards. (a) The reinstatement and to collect their wages during the period of
Secretary of Labor and Employment or any Regional Director, the the effectivity of the order but merely suspended the
Commission or any Labor Arbiter, or med-arbiter or voluntary implementation thereof pending the determination of the
arbitrator may, motu proprio or on motion of any interested party, validity of the NLRC resolutions subject of the petition.
issue a writ of execution on a judgment within five (5) years from Naturally, a finding of this Court that private
the date it becomes final and executory, requiring a sheriff or a respondents were not entitled to reinstatement would
duly deputized officer to execute or enforce final decisions, orders mean that they had no right to collect any back wages.
or awards of the Secretary of Labor and Employment or regional On the other hand, where the Court affirmed the decision of
director, the Commission, the Labor Arbiter or med-arbiter, or the NLRC and recognized the right of private respondents
voluntary arbitrators. In any case, it shall be the duty of the to reinstatement, private respondents are entitled to the
responsible officer to separately furnish immediately the counsels wages accruing during the effectivity of the temporary
of record and the parties with copies of said decisions, orders or
restraining order.[35] (Emphasis and underscoring
awards. Failure to comply with the duty prescribed herein shall
subject such responsible officer to appropriate administrative supplied)
sanctions. While Zamboanga was decided prior to St. Martin Funeral
and, therefore, the NLRC decisions were at the time passed
x x x x (Emphasis and underscoring supplied), upon by this Court to the exclusion of the appellate court, it
is still applicable.
there was still a need for the issuance of a writ of
execution of the NLRC decision. Since this Court is now affirming the challenged decision of the
Court of Appeals finding that petitioner was validly dismissed and
accordingly reversing the NLRC Decision that petitioner was
illegally dismissed and should be reinstated, 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. Had one
been issued, respondent would have been obliged to reinstate
petitioner and pay her salary until the said order of the NLRC for
her reinstatement was reversed by the Court of Appeals, and
following Roquero, petitioner would not have been obliged to
reimburse respondent for whatever salary she received in the
interim.
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 if we are to
heed the injunction of the Court in Philippine Geothermal, Inc v.
NLRC:
While it is true that compassion and human consideration should
guide the disposition of cases involving termination of employment
since it affects ones source or means of livelihood, it should not be
overlooked that the benefits accorded to labor do not include
compelling an employer to retain the services of an employee who
has been shown to be a gross liability to the employer. The law in
protecting the rights of the employees authorizes neither
oppression nor self-destruction of the employer. It should be
made clear that when the law tilts the scale of justice in favor of
labor, it is but a recognition of the inherent economic inequality
between labor and management. The intent is to balance the scale
of justice; to put the two parties on relatively equal positions.
There may be cases where the circumstances warrant
favoring labor over the interests of management but never
should the scale be so tilted if the result is an injustice to the
employer. Justitia nemini neganda est (Justice is to be denied to
none).[36] (Italics in the original; emphasis and underscoring
supplied)
WHEREFORE, the petition is DENIED. The assailed Court of
Appeals Decision dated May 16, 2003 and Resolution dated
November 17, 2003 are AFFIRMED.
SO ORDERED.
SECOND DIVISION that the same was illegal. Citing CALS Poultry Supply v. Roco,[6]
the appellate court held that petitioner failed to prove the fact of
dismissal. Petitioner's motion for reconsideration having been
G.R. No. 178524, January 30, 2009
denied by Resolution dated March 16, 2007, the present recourse
was filed.
PANFILO MACASERO, PETITIONER, VS. SOUTHERN
INDUSTRIAL GASES PHILIPPINES AND/OR NEIL LINDSAY, Petitioner contends that it is respondent company, as the
RESPONDENTS. employer, which has the burden of proving that he was not
dismissed, or if dismissed, that the dismissal was not illegal; and
DECISION that he having proved that he was dismissed and that it was
CARPIO MORALES, J.: illegal, he is entitled to backwages and reinstatement, or
separation pay of one month for every year of service, not just one
The services of Panfilo Macasero (petitioner) were engaged by half month, there being no allegation nor proof of serious financial
Southern Industrial Gases, Philippines (respondent company) as reverses on the part of respondent company.
Carbon Dioxide Bulk Tank Escort since September 1995. For
every 24-hour work rendered by him in escorting respondent In their Comment,[7] respondents aver that the petition raises
company's tanks while they were being shipped from Cebu and to questions of fact and maintain that no employer-employee
other areas in the Visayas and Mindanao, petitioner earned P200, relationship existed between respondent company and petitioner.
aside from receiving transportation, accommodation, and meal
allowances. In any event, relying on Chong Guan Trading v. National Labor
Relations Commission,[8] respondents contend that petitioner was
On January 5, 1999, petitioner filed before the National Labor never given a notice of dismissal nor was he prevented from
Relations Commission (NLRC) Regional Arbitration Branch No. VII returning to work, hence, there could be no illegal dismissal.
a Complaint[1] against respondent company and/or its co-
respondent General Manager Neil Lindsay, for illegal dismissal At the outset, the Court notes that while it is axiomatic that only
with prayer for reinstatement, backwages, unpaid benefits, and questions of law can be raised in a petition for review on certiorari
attorney's fees, alleging that in September 1998, he was advised under Rule 45, the same is not without exceptions, thus:
that his services were no longer needed and was in fact prevented
from entering the company premises. Rule 45 of the Rules of Civil Procedure provides that
only questions of law shall be raised in an appeal by
In their Position Paper,[2] respondents contended that no certiorari before this Court. This rule, however,
employer-employee relationship existed between respondent admits of certain exceptions, namely, (1) when the
company and petitioner because his services were only findings are grounded entirely on speculations,
occasionally required, he having worked 287 days in the 3 years surmises, or conjectures; (2) when the inference
that he was connected with it; that petitioner was never subject to made is manifestly mistaken, absurd, or
respondent company's supervision and/or control; and that impossible; (3) when there isa grave abuse of
petitioner had no fixed work schedule, hence, at most, he was an discretion; (4) when the judgment is based on
"unsupervised pakiaw or task worker." misappreciation of facts; (5) when the findings of
fact are conflicting; (6) when in making its findings,
By Decision of December 7, 1999, the Labor Arbiter held that the same are contrary to the admissions of both
petitioner was a regular employee but that he was not illegally appellant and appellee; (7) when the findings are
dismissed, no particulars of the fact of dismissal having been contrary to those of the trial court; (8) when the
proffered. The Labor Arbiter thereupon ordered respondent to pay findings are conclusions without citation of
petitioner separation pay equivalent to one month salary for every specific evidence on which they are based; (9)
th when the facts set forth in the petition as well as in
year of service plus 13 month pay.
the petitioner's main and reply briefs are not
disputed by the respondent; and (10) when the
Petitioner appealed to the NLRC, questioning the computation of
findings of fact are premised on the supposed
the monetary award and the non-award of backwages, attorney's
absence of evidence and contradicted by the
fees, and costs of litigation.
evidence on record.[9] (Emphasis supplied)
Respondents appealed too, insisting that no employer-employee
relationship existed between respondent company and petitioner As shall be discussed shortly, a review of the records of the case
who it claimed was actually an independent contractor or, at best, and the bases of the findings of the Arbiter, the NLRC and the
a task worker. appellate court shows that the petition comes within the purview of
the above-highlighted exceptions, hence, the Court resolves to
By Decision[3] dated October 28, 2002, the NLRC affirmed the give it due course.
labor arbiter's ruling that petitioner was a regular employee and
that there was no illegal dismissal. It, however, modified the There being uniformity in the findings of the labor tribunals and the
Arbiter's computation of separation pay. appellate court that an employer-employee relationship existed
between petitioner and respondent company and that he was a
Acting on the separate motions for reconsideration of the parties, regular employee, the only issue left for determination is whether
the NLRC, by Resolution[4] of December 15, 2003, modified the petitioner was dismissed and, if in the affirmative, if it was legally
computation of the separation pay to one half month salary for effected.
every year of service, thus, lowering the amount to P15,700.
Respondents reiterate their claim that its act of not providing work
By Decision[5] dated August 10, 2006, the appellate court affirmed to petitioner starting September 1995 was "due principally to a
the NLRC modified Decision, holding that there was no evidence slump in the market and the dwindling demand by the Visayas-
to show that petitioner's employment was terminated, much less Mindanao clients."[10] This claim was credited by the Arbiter, the
NLRC and the appellate court. The Court does not. The payment of separation pay is in addition to
payment of backwages.[14] (Emphasis and
In illegal dismissal cases, the onus of proving that the underscoring supplied)
employee was not dismissed or, if dismissed, that the
dismissal was not illegal, rests on the employer, failure to And in Velasco v. National Labor Relations Commission:[15]
discharge which would mean that the dismissal is not
justified and, therefore, illegal.[11] The accepted doctrine is that separation pay
may avail in lieu of reinstatement if
Indeed, a party alleging a critical fact must support his allegation reinstatement is no longer practical or in the
with substantial evidence, for any decision based on best interest of the parties. Separation pay in lieu
unsubstantiated allegation cannot stand without offending due of reinstatement may likewise be awarded if the
process. [12] employee decides not to be reinstated.

Respondents' claim that there was a business slump, hence, In fine, the Court finds that petitioner was, contrary to the
petitioner could not be given any escorting assignment has conclusion of the labor tribunals and the appellate court, dismissed
remained just that. The records are bereft of any documentary without just cause.
evidence showing that it was indeed suffering losses or a decline
in orders which justified its admitted failure to give assignments to Petitioner having been compelled to litigate in order to seek
petitioner. redress, he is entitled, as he had prayed early on, to the award of
attorney's fees equivalent to 10% of the total monetary award.
The appellate court ratiocinated that before respondent company
could be burdened with proving the legality of dismissal, "there has Respecting petitioner's claim for moral and exemplary damages,
to be details of acts attributed to [respondents] constituting illegal there being no clear showing that the dismissal was effected in a
dismissal if only to give [petitioner] the opportunity to adduce malevolent or oppressive manner, petitioner is not entitled thereto.
evidence to defend himself from or disprove occurrence of such
act or inaction," but that petitioner failed to do so. Respondents WHEREFORE, the petition is GRANTED. The challenged
must not, however, only rely on the seeming weakness of Decision of the Court of Appeals is SET ASIDE, and a new one
petitioner's evidence, but must stand on the merits of their own ENTERED declaring illegal the dismissal of petitioner, and
defense. accordingly ordering respondent company to reinstate petitioner,
Panfilo Macasero, to his former position as Carbon Dioxide Bulk
The Court finds incongruous the crediting by the labor tribunals Tank Escort without loss of seniority rights and other privileges,
and the appellate court of respondents' claim that petitioner must and to pay him full backwages and other benefits from the time his
prove the fact of his dismissal with particularity and at the same compensation was withheld (from September, 1998) up to his
time accept respondents' above-said unsubstantiated claim that actual reinstatement, as well as attorney's fees equivalent to 10%
business slump prevented it from giving petitioner escorting of the monetary award. Should reinstatement be no longer
assignment. possible due to strained relations, respondent company is ordered
to grant separation pay at one (1) month per year of service from
While both labor tribunals and the appellate court held that 1995-1998.
petitioner failed to prove the fact of his dismissal, they oddly
ordered the award of separation pay in lieu of reinstatement in SO ORDERED.
light of respondent company's "firm stance that [herein petitioner]
was not its employee [vis a vis] the unflinching assertion of [herein
petitioner] that he was which do[es] not create a fertile ground for
reinstatement." It goes without saying that the award of separation
pay is inconsistent with a finding that there was no illegal
dismissal, for under Article 279[13] of the Labor Code and as held
in a catena of cases, an employee who is dismissed without just
cause and without due process is entitled to backwages and
reinstatement or payment of separation pay in lieu thereof:
Thus, an illegally dismissed employee is entitled
to two reliefs: backwages and reinstatement.
The two reliefs provided are separate and distinct.In
instances where reinstatement is no longer feasible
because of strained relations between the employee
and the employer, separation pay is granted. In
effect, an illegally dismissed employee is entitled to
either reinstatement, if viable, or separation pay if
reinstatement is no longer viable, and backwages.

The normal consequences of respondents'

illegal dismissal, then, are reinstatement without
loss of seniority rights, and payment of
backwages computed from the time
compensation was withheld up to the date of
actual reinstatement. Where reinstatement is no
longer viable as an option, separation pay
equivalent to one (1) month salary for every year
of service should be awarded as an alternative.
 Garcia to extend the necessary assistance to the DPWH
ADAM B. GARCIA, G.R. No. 172854 personnel and the needs of the road grader.
In the course of its operation, the road grader broke down several
Petitioner, times. Garcia instructed Roly B. Balanta, Legazpi Oils Production
Maintenance Crew, to make the repairs using spare parts brought
- versus - Present: by the DPWH personnel except for one bolt piece taken from
Legazpi Oil's stockroom.
NATIONAL LABOR RELATIONSQUISUMBING, J., Chairperson, Since Engr. Abo and de la Torre were not authorized to rent out
COMMISSION (SECOND government property for private use, they agreed with Mercado to
DIVISION), LEGAZPI OILCARPIO MORALES, make it appear to Legazpi Oil that it was Torregoza who rented out
COMPANY, INC., ROMEO F. the road grader. Thereafter, billings for the use of the road grader
MERCADO and GUS ZULUAGA, were prepared and approved by Mercado. Legazpi Oil then issued
TINGA,
a check amounting to P37,373.32 in the name of Torregoza.
Respondents. Torregoza endorsed the check to Garcia, who, encashed it. Garcia
VELASCO, JR., and gave the full amount to Engr. Abo who, in turn, gave him
P1,300.00 to pay the accumulated food consumption of the DPWH
BRION, JJ. personnel at the canteen.
Later, Legazpi Oil used the road grader again. It issued another
Promulgated: check amounting to P5,541.45 in the name of Torregoza. Again,
Torregoza endorsed the check to Garcia, who, encashed it. De la
Torre gave Torregoza P2,000.00. Engr. Abo gave the balance of
both checks to Engr. Bogayong as payment for the steering
April 16, 2009
booster used in repairing the road grader.
On , Torregoza filed a complaint-affidavit against Garcia with
Legazpi Oil. He claimed that Garcia made him endorse the
DECISION P37,373.32 check and gave him only P2,000.00. He further
QUISUMBING, J.: averred that when he tried to claim the P5,541.45 check, Legazpi
Oils cashier refused to give it to him unless Garcia was around,
upon the latters instruction.
In a Memorandum[6] dated December 7, 1994, Mercado required
For review are the Decision[1] dated and the Resolution[2] dated , Garcia to explain within 24 hours why he should not be penalized
of the Court of Appeals in CA-G.R. SP No. 51307. The appellate for the following alleged infractions:
court had affirmed the Decision[3] dated 29, 1998, of the National
Labor Relations Commission (NLRC) in NLRC NCR CA No.
0101471-96, which had earlier reversed the Decision[4] dated , of a.) CATEGORY NO. 4, Item No. 8
the Labor Arbiter in RAB V Case No. .
The pertinent facts[5] are as follows: Offering or accepting directly/indirectly anything of value in
exchange for a job, business transactions or any favor in
Petitioner Adam B. Garcia was employed as Production connection with the work, for personal gain or profit.
Maintenance Foreman by respondent Legazpi Oil Company, Inc.
(Legazpi Oil) from to .
b.) CATEGORY NO. 4, Item No. 19, Letter (e) Breach of Trust and
In December 1992, respondent Romeo F. Mercado, the Plant Confidence
Operations Manager, instructed Garcia to look for a road grader to
clear and level the plant road network in preparation for the arrival
of certain plant visitors. Garcia failed to secure one because no Any act of dishonesty with the intention to defraud company.
road grader was available then.
A week later, Mercado reminded Garcia about the road grader.
Garcia went to the Area Equipment Services of the Department of
Garcia admitted encashing the checks. However, he claimed that
Public Works and Highways (DPWH) in Albay. He was able to talk
he did so only upon Torregozas request, and that he gave the
to Engineer Antonio S. Abo, the Fleet-in-Charge, who advised him
proceeds thereof to Engr. Abo, less the amount of P1,300.00
to come back as there was no available unit yet.
which he paid to the canteen. He insisted that since it was against
Mercado further pressed Garcia to follow up the request with the the policy of the Bureau of Equipment of the DPWH to engage in
DPWH. This time, Regional Equipment Engineer Bienvenido private business, Engr. Abo designated Torregoza, a retired DPWH
Bogayong allowed the use of the newly-rehabilitated road grader employee, to sign the necessary papers in his behalf and to collect
by way of operational test provided that Legazpi Oil would the amounts due for the use of the road grader and the wages of
shoulder fuel consumption and repairs as may be necessary, the workers. He claimed that Mercado had agreed to the
including materials, equipment and labor cost, as well as the arrangement. Garcia insisted that he did not retain a single
wages of the operator and the helper. centavo from the proceeds of the checks. He then requested
Mercado to invite all persons involved for an investigation.[7]
Oscar A. de la Torre, a DPWH employee, hired Jesus T.
Torregoza, a retired DPWH employee, to drive the road grader to On , Mercado placed Garcia under preventive suspension for 30
Legazpi Oil. Upon their arrival, Garcia and Mercado met them. working days without pay effective . In the meantime, Mercado
Engr. Abo then informed Mercado of the aforesaid condition to submitted to the Personnel and Administrative Manager his
which Mercado agreed. Thereafter, Mercado orally instructed findings and recommendation on Garcias alleged infractions.
In a Letter[8] dated , Garcia was required to explain within 48 Other claims and charges are hereby dismissed for lack of merit.
hours his alleged unauthorized use of company personnel,
equipment, and materials in the repair of the road grader. He was
also placed on forced leave with pay for five working days SO ORDERED.[14]
beginning . The letter reads in part:

In the course of our investigation on the case of the Road Grader On appeal, the NLRC set aside the decision of the Labor Arbiter
that was leased to us, it was disclosed that when the Grader broke and dismissed the complaint for lack of merit. It did not give
down you caused the same to be repaired using company credence to Garcias claims, as well as the affidavits and
personnel, equipment and materials without prior approval by the testimonies of Engr. Abo and de la Torre. The NLRC ruled that
management. This is a violation of our rules and your act, favored Garcias claim that he gave the proceeds of the checks to Engr.
our contractor without the corresponding payment to the company Abo was belied by Engr. Abo who averred that it was Engr.
for manpower, equipment, and materials used for the said repair. Bogayong who received the said proceeds. It added that Engr.
Attached is a copy of the affidavit of our employee pertaining to Abos affidavit and testimony were not worthy of belief because
that incident. while he alleged in his affidavit that Garcia talked to him about the
road grader in December 1992, he claimed during cross-
examination that Garcia conferred with him in January 1992.
xxxx
However, while the NLRC found that Garcia was dismissed for just
cause, it ruled that:

Garcia explained that he did not seek Mercado's permission [W]e cannot subscribe to the manner the dismissal was effected.
before making the repairs because of the latters instruction to While the Complainant was given the chance to submit his
assist the DPWH personnel in the course of their work. He explanation regarding his alleged violation of company rules, we
maintained that Mercado knew about the repairs because he was are not ready to concede to the respondents position that his right
aware of the condition of the road grader and even saw Balanta of due process was accorded to him to its fullest. Hence, in this
doing the repairs. He then reiterated his request to invite the regard, by virtue of this violation, complainant should be awarded
DPWH personnel to clear up everything.[9] an indemnity pay equivalent to his one (1) month salary in
accordance with existing jurisprudence. [Citations omitted.][15]
In a Memorandum[10] dated , Garcia was dismissed due to
dishonesty and loss of trust and confidence.
Garcia filed a complaint for illegal suspension, illegal dismissal,
and other labor standard violations against Legazpi Oil, Mercado, Garcia filed a petition for certiorari before this Court. Pursuant to
and Gus Zuluaga. A.M. No. 99-2-01-SC[16] dated , we remanded the case to the
Court of Appeals. The appellate court dismissed the petition on the
On , the Labor Arbiter ruled in favor of Garcia. The Labor Arbiter ground that it only raised questions of fact. It also denied Garcias
gave credence and full probative weight to the affidavits and motion for reconsideration.
testimonies of Garcia,[11] Engr. Abo,[12] and de la Torre.[13] He
declared that Garcia was dismissed without just cause and due On appeal, we remanded the case again to the Court of Appeals
process. The Labor Arbiter also pronounced that in encashing the for further proceedings.[17]
two checks, Garcia merely accommodated Torregoza and did not On , the appellate court denied the petition. It found Garcias
profit from him. Moreover, Torregoza admitted that he received encashment of the checks in favor of Torregoza dubious. There
P2,000.00 from de la Torre and not from Garcia. The dispositive was no need for Torregoza to endorse the checks to Garcia for
portion of the decision reads: encashment and for Garcia to turn over the proceeds to Engr. Abo
since Torregoza could have simply endorsed the checks to any of
WHEREFORE, premises considered, judgment is hereby the DPWH personnel with whom he had transacted. Garcia held a
rendered finding respondent Legazpi Oil Co./Romeo Mercado, position of trust and confidence and his encashment of the checks
manager, guilty of illegal dismissal and thereby directing said resulted in Legazpi Oils loss of confidence in him. The appellate
respondent to reinstate complainant to his former position without court also ruled that Garcia was afforded due process prior to his
loss of seniority rights plus all other benefits, privileges and dismissal. He was apprised of his infractions and given the
emoluments he may have been entitled to at the time of his opportunity to answer the charges against him through the
termination from his employment and to pay him full backwages submission of his written explanations. The fact that no further
subject to deduction of his earnings elsewhere, reckoned with from investigation was conducted is of no moment since due process
the time his compensation was withheld on December 29, 1994 up does not require a trial-type proceeding similar to those in the
to the time of actual reinstatement which to date amounted [to] courts. Thus, the appellate court ordered:
P127,710.88 together with the certificate to the effect that
complainant was actually reinstated. WHEREFORE, finding that public respondent NLRC did not act
with grave abuse of discretion, the instant petition is hereby
Respondent is further ordered to pay complainant moral and DENIED and is accordingly DISMISSED.
exemplary damages in the total amount of P10,000.00 plus 10%
attorney's fees of the [total] award. SO ORDERED.[18]

That the aggregate amount of P151,481.97 together with the

certificate to the effect that complainant was actually reinstated be
coursed thru this Branch within ten (10) days from receipt hereof Reconsideration having been denied, petitioner now comes before
for proper disposition. us, alleging that the appellate court erred:
 I. noteworthy, it was Manager Mercado who goaded Garcia to find a
road grader for the use of the company, even to the extent of
requesting DPWH, which admittedly is prohibited from renting out
IN DISMISSING THE PETITION AND IN NOT REINSTATING THE government property for private use. Garcia had no option but to
DECISION DATED RENDERED BY THE EXECUTIVE LABOR follow Mercados orders.
ARBITER [THERE BEING] LACK OF DUE PROCESS IN THE
TERMINATION OF EMPLOYMENT OF PETITIONER.[19] Loss of trust and confidence, as a valid ground for dismissal, must
be based on willful breach of the trust reposed in the employee by
his employer. Such breach is willful if it is done intentionally,
II. knowingly, and purposely, without justifiable excuse, as
distinguished from an act done carelessly, thoughtlessly,
heedlessly or inadvertently.[29] Elsewise stated, it must be based
IN DISMISSING THE PETITION AND IN NOT REINSTATING THE on substantial evidence and not on the employers whims or
DECISION DATED RENDERED BY THE [EXECUTIVE] LABOR caprices or suspicions; otherwise, the employee would eternally
ARBITER [THERE BEING] NO JUST CAUSE FOR THE remain at the mercy of the employer.[30] A condemnation of
TERMINATION OF EMPLOYMENT OF PETITIONER.[20] dishonesty and disloyalty cannot arise from suspicion spawned by
speculative inferences.[31]
The issues for resolution are: (1) Was the petitioner validly
dismissed due to dishonesty and loss of trust and confidence? and Loss of confidence must not be indiscriminately used as a shield
(2) Was petitioner afforded due process? by the employer against a claim that the dismissal of an employee
was arbitrary. Loss of confidence as a just cause for termination of
The petition is meritorious. employment is premised on the fact that the employee concerned
holds a position of responsibility or trust and confidence. He must
Records show that Legazpi Oil dismissed petitioner on the ground be invested with confidence on delicate matters, such as custody
of dishonesty and loss of trust and confidence due to the following handling or care and protection of the property and assets of the
alleged infractions: (1) encashment of two checks in the name of employer. And, in order to constitute a just cause for dismissal, the
Torregoza; and (2) unauthorized use of company personnel, act complained of must be work-related and shows that the
equipment, and materials in the repair of the road grader. employee concerned is unfit to continue to work for the employer.
[32]
On the first ground, it appears that petitioner merely
accommodated Torregozas request. While we see no reason why In this case, we do not find the evidence sufficient to hold that
Torregoza would rather have petitioner encash the checks, it has petitioners actuations amounted to a willful breach of trust.
been duly proven that petitioner turned over the proceeds thereof Petitioner acted only based on Manager Mercados oral instruction
to Engr. Abo. From the first check of P37,373.32, Engr. Abo gave and we do not see how it could be construed as a breach of trust.
petitioner only P1,300.00 to pay the accumulated food
consumption of the DPWH personnel at the canteen.[21] From the It is also significant to note that in the memorandum of termination,
second check of P5,541.45, de la Torre gave Torregoza the other ground for petitioners dismissal was dishonesty. Again,
P2,000.00.[22] Engr. Abo gave the balance of both checks to there is no evidence establishing the basis for this ground. The
Engr. Bogayong as payment for the steering booster used in specific acts which constitute this ground were not even alleged by
repairing the road grader.[23] Legazpi Oil. On the contrary, petitioner has been candid in
admitting that he indeed encashed the checks and allowed the
Contrary to Torregozas claim, it was actually de la Torre and not repairs of the road grader.
petitioner who gave him P2,000.00.[24] Moreover, his allegation
that petitioner instructed the cashier to withhold the release of the All told, the circumstances surrounding the case all militate against
second check to him unless petitioner was around, remained the validity of petitioners dismissal. We need not discuss further
unsubstantiated. The cashier was never called to testify during the the matter of due process.
company investigation or the clarificatory hearings by the Labor
Arbiter. Likewise, contrary to what Legazpi Oil has insinuated, WHEREFORE, the instant petition is GRANTED. The Decision
petitioner never profited from the encashment of the checks since dated and the Resolution dated of the Court of Appeals in CA-G.R.
its full amount has been completely accounted for. Indeed, SP No. 51307 are REVERSED.
petitioner merely followed Mercados oral instruction to extend the
necessary assistance to the DPWH personnel.[25]
Let this case be remanded to the Labor Arbiter for the proper
On the second ground, it seems that Mercado knew that the use of computation of petitioners monetary benefits in accordance with
the road grader was subject to the condition that Legazpi Oil would Article 279[33] of the Labor Code of the .
shoulder fuel consumption and repairs as may be necessary,
including materials, equipment and labor cost, as well as the
wages of the operator and the helper. Mercado admitted that he Costs against private respondent company.
met Engr. Abo when the road grader was delivered to Legazpi Oil
and that Engr. Abo informed him of the condition, to which he
agreed.[26] SO ORDERED.
It is also clear that Mercado was aware when the road grader
broke down since he saw Balanta doing the repairs.[27] Had he
found petitioners omission to seek his permission before making
the repairs against company policy, he could have called
petitioners attention right there and then. It could only be
concluded that petitioner was duly authorized to make use of
company personnel, equipment, and materials as a result of
Mercados prior oral instruction to petitioner to extend the
necessary assistance to the needs of the road grader.[28] No less
 The case stemmed from the administrative charge filed by PAL
JUANITO A. GARCIA and against its employees-herein petitioners[3] after they were
ALBERTO J. DUMAGO, G.R. No. 164856 allegedly caught in the act of sniffing shabu when a team of
Present: company security personnel and law enforcers raided the PAL
Petitioners, Technical Centers Toolroom Section on July 24, 1995.

PUNO, C.J., After due notice, PAL dismissed petitioners on October 9, 1995 for
- versus -
transgressing the PAL Code of Discipline, [4] prompting them to
QUISUMBING, file a complaint for illegal dismissal and damages which was, by
PHILIPPINE AIRLINES,
Decision of January 11, 1999,[5] resolved by the Labor Arbiter in
INC.,
YNARES-SANTIAGO, their favor, thus ordering PAL to, inter alia, immediately comply
with the reinstatement aspect of the decision.
Respondent.
CARPIO, Prior to the promulgation of the Labor Arbiters decision, the
Securities and Exchange Commission (SEC) placed PAL
AUSTRIA-MARTINEZ, (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
CORONA, Receiver on .

CARPIO MORALES, From the Labor Arbiters decision, respondent appealed to the
NLRC which, by Resolution of , reversed said decision and
AZCUNA, dismissed petitioners complaint for lack of merit.[6]

Petitioners Motion for Reconsideration was denied by Resolution

TINGA, of and Entry of Judgment was issued on .[7]

CHICO-NAZARIO, Subsequently or on , the Labor Arbiter issued a Writ of Execution

(Writ) respecting the reinstatement aspect of his Decision, and on ,
he issued a Notice of Garnishment (Notice). Respondent
VELASCO, JR., thereupon moved to quash the Writ and to lift the Notice while
petitioners moved to release the garnished amount.
NACHURA,
In a related move, respondent filed an Urgent Petition for
Injunction with the NLRC which, by Resolutions of and , affirmed
LEONARDO-DE CASTRO, and the validity of the Writ and the Notice issued by the Labor Arbiter
but suspended and referred the action to the Rehabilitation
BRION, JJ. Receiver for appropriate action.
Respondent elevated the matter to the appellate court which
Promulgated: issued the herein challenged Decision and Resolution nullifying
the NLRC Resolutions on two grounds, essentially espousing that:
January 20, 2009 (1) a subsequent finding of a valid dismissal removes the basis for
implementing the reinstatement aspect of a labor arbiters decision
(the first ground), and (2) the impossibility to comply with the
x--------------------------------------------------------------------------------------- reinstatement order due to corporate rehabilitation provides a
--x reasonable justification for the failure to exercise the options under
DECISION Article 223 of the Labor Code (the second ground).

CARPIO MORALES, J.: By Decision of , this Court PARTIALLY GRANTED the present
petition and effectively reinstated the NLRC Resolutions insofar as
Petitioners Juanito A. Garcia and Alberto J. Dumago assail the it suspended the proceedings, viz:
December 5, 2003 Decision and April 16, 2004 Resolution of the
Since petitioners claim against PAL is a money claim for their
Court of Appeals[1] in CA-G.R. SP No. 69540 which granted the
wages during the pendency of PALs appeal to the NLRC, the
petition for certiorari of respondent, Philippine Airlines, Inc. (PAL), same should have been suspended pending the rehabilitation
and denied petitioners Motion for Reconsideration, respectively. proceedings. The Labor Arbiter, the NLRC, as well as the Court of
The dispositive portion of the assailed Decision reads: Appeals should have abstained from resolving petitioners case for
WHEREFORE, premises considered and in view of the foregoing, illegal dismissal and should instead have directed them to lodge
the instant petition is hereby GIVEN DUE COURSE. The assailed their claim before PALs receiver.
November 26, 2001 Resolution as well as the January 28, 2002 However, to still require petitioners at this time to re-file their labor
Resolution of public respondent National Labor Relations claim against PAL under peculiar circumstances of the case that
Commission [NLRC] is hereby ANNULLED and SET ASIDE for their dismissal was eventually held valid with only the matter of
having been issued with grave abuse of discretion amounting to reinstatement pending appeal being the issue this Court deems it
lack or excess of jurisdiction. Consequently, the Writ of Execution legally expedient to suspend the proceedings in this case.
and the Notice of Garnishment issued by the Labor Arbiter are
hereby likewise ANNULLED and SET ASIDE. WHEREFORE, the instant petition is PARTIALLY GRANTED in
that the instant proceedings herein are SUSPENDED until further
SO ORDERED.[2] notice from this Court. Accordingly, respondent Philippine Airlines,
Inc. is hereby DIRECTED to quarterly update the Court as to the
status of its ongoing rehabilitation. No costs. Considering that Genuino was not reinstated to work or placed on
payroll reinstatement, and her dismissal is based on a just cause,
SO ORDERED.[8] (Italics in the original; underscoring supplied) then she is not entitled to be paid the salaries stated in item no. 3
By Manifestation and Compliance of , respondent informed the of the fallo of the September 3, 1994 NLRC Decision.[14]
Court that the SEC, by Order of , granted its request to exit from (Emphasis, italics and underscoring supplied)
rehabilitation proceedings.[9] It has thus been advanced that there is no point in releasing the
wages to petitioners since their dismissal was found to be valid,
In view of the termination of the rehabilitation proceedings, the and to do so would constitute unjust enrichment.
Court now proceeds to resolve the remaining issue for Prior to Genuino, there had been no known similar case containing
consideration, which is whether petitioners may collect their a dispositive portion where the employee was required to refund
wages during the period between the Labor Arbiters order of the salaries received on payroll reinstatement. In fact, in a catena
reinstatement pending appeal and the NLRC decision
overturning that of the Labor Arbiter, now that respondent of cases,[15] the Court did not order the refund of salaries
has exited from rehabilitation proceedings. garnished or received by payroll-reinstated employees despite a
subsequent reversal of the reinstatement order.
Amplification of the First Ground The dearth of authority supporting Genuino is not difficult to
The appellate court counted on as its first ground the view that a fathom for it would otherwise render inutile the rationale of
subsequent finding of a valid dismissal removes the basis for reinstatement pending appeal.
implementing the reinstatement aspect of a labor arbiters decision. x x x [T]he law itself has laid down a compassionate policy which,
On this score, the Courts attention is drawn to seemingly divergent once more, vivifies and enhances the provisions of the 1987
decisions concerning reinstatement pending appeal or, particularly, Constitution on labor and the working man.
the option of payroll reinstatement. On the one hand is the
jurisprudential trend as expounded in a line of cases including Air xxxx
Philippines Corp. v. Zamora,[10] while on the other is the recent These duties and responsibilities of the State are imposed not so
case of Genuino v. National Labor Relations Commission.[11] At much to express sympathy for the workingman as to forcefully and
the core of the seeming divergence is the application of paragraph meaningfully underscore labor as a primary social and economic
3 of Article 223 of the Labor Code which reads: force, which the Constitution also expressly affirms with equal
In any event, the decision of the Labor Arbiter reinstating a intensity. Labor is an indispensable partner for the nation's
dismissed or separated employee, insofar as the reinstatement progress and stability.
aspect is concerned, shall immediately be executory, pending xxxx
appeal. The employee shall either be admitted back to work under
the same terms and conditions prevailing prior to his dismissal or x x x In short, with respect to decisions reinstating employees, the
separation or, at the option of the employer, merely reinstated in law itself has determined a sufficiently overwhelming reason for its
the payroll. The posting of a bond by the employer shall not stay execution pending appeal.
the execution for reinstatement provided herein. (Emphasis and
underscoring supplied) xxxx

The view as maintained in a number of cases is that: x x x Then, by and pursuant to the same power (police power), the
x x x [E]ven if the order of reinstatement of the Labor Arbiter is State may authorize an immediate implementation, pending
reversed on appeal, it is obligatory on the part of the appeal, of a decision reinstating a dismissed or separated
employer to reinstate and pay the wages of the dismissed employee since that saving act is designed to stop, although
employee during the period of appeal until reversal by the temporarily since the appeal may be decided in favor of the
higher court. On the other hand, if the employee has been appellant, a continuing threat or danger to the survival or even the
reinstated during the appeal period and such reinstatement order life of the dismissed or separated employee and his family.[16]
is reversed with finality, the employee is not required to reimburse
whatever salary he received for he is entitled to such, more so if The social justice principles of labor law outweigh or render
inapplicable the civil law doctrine of unjust enrichment
he actually rendered services during the period.[12] (Emphasis in espoused by Justice Presbitero Velasco, Jr. in his Separate
the original; italics and underscoring supplied) Opinion. The constitutional and statutory precepts portray the
In other words, a dismissed employee whose case was favorably otherwise unjust situation as a condition affording full protection to
decided by the Labor Arbiter is entitled to receive wages pending labor.
appeal upon reinstatement, which is immediately executory. Even outside the theoretical trappings of the discussion and into
Unless there is a restraining order, it is ministerial upon the Labor the mundane realities of human experience, the refund doctrine
Arbiter to implement the order of reinstatement and it is mandatory easily demonstrates how a favorable decision by the Labor Arbiter
could harm, more than help, a dismissed employee. The
on the employer to comply therewith.[13] employee, to make both ends meet, would necessarily have to use
The opposite view is articulated in Genuino which states: up the salaries received during the pendency of the appeal, only to
If the decision of the labor arbiter is later reversed on appeal upon end up having to refund the sum in case of a final unfavorable
the finding that the ground for dismissal is valid, then the decision. It is mirage of a stop-gap leading the employee to a risky
employer has the right to require the dismissed employee on cliff of insolvency.
payroll reinstatement to refund the salaries s/he received Advisably, the sum is better left unspent. It becomes more logical
while the case was pending appeal, or it can be deducted from the and practical for the employee to refuse payroll reinstatement and
accrued benefits that the dismissed employee was entitled to simply find work elsewhere in the interim, if any is available.
receive from his/her employer under existing laws, collective Notably, the option of payroll reinstatement belongs to the
bargaining agreement provisions, and company practices. employer, even if the employee is able and raring to return to
However, if the employee was reinstated to work during the work. Prior to Genuino, it is unthinkable for one to refuse payroll
pendency of the appeal, then the employee is entitled to the reinstatement. In the face of the grim possibilities, the rise of
compensation received for actual services rendered without need concerned employees declining payroll reinstatement is on the
of refund. horizon.
Further, the Genuino ruling not only disregards the social justice terms and conditions prevailing prior to their dismissal, or to
principles behind the rule, but also institutes a scheme unduly reinstate them in the payroll, and that failing to exercise the
favorable to management. Under such scheme, the salaries options in the alternative, employer must pay the employees
dispensed pendente lite merely serve as a bond posted in salaries.[22]
installment by the employer. For in the event of a reversal of the Amplification of the Second Ground
Labor Arbiters decision ordering reinstatement, the employer gets The remaining issue, nonetheless, is resolved in the negative on
back the same amount without having to spend ordinarily for bond the strength of the second ground relied upon by the appellate
premiums. This circumvents, if not directly contradicts, the court in the assailed issuances. The Court sustains the appellate
proscription that the posting of a bond [even a cash bond] by the courts finding that the peculiar predicament of a corporate
employer shall not stay the execution for reinstatement.[17] rehabilitation rendered it impossible for respondent to exercise its
In playing down the stray posture in Genuino requiring the option under the circumstances.
dismissed employee on payroll reinstatement to refund the The spirit of the rule on reinstatement pending appeal animates
salaries in case a final decision upholds the validity of the the proceedings once the Labor Arbiter issues the decision
dismissal, the Court realigns the proper course of the prevailing containing an order of reinstatement. The immediacy of its
doctrine on reinstatement pending appeal vis--vis the effect of a execution needs no further elaboration. Reinstatement pending
reversal on appeal. appeal necessitates its immediate execution during the pendency
Respondent insists that with the reversal of the Labor Arbiters of the appeal, if the law is to serve its noble purpose. At the same
Decision, there is no more basis to enforce the reinstatement time, any attempt on the part of the employer to evade or delay its
aspect of the said decision. In his Separate Opinion, Justice execution, as observed in Panuncillo and as what actually
Presbitero Velasco, Jr. supports this argument and finds the transpired in Kimberly,[23] Composite,[24] Air ,[25] and
prevailing doctrine in Air Philippines and allied cases inapplicable Roquero,[26] should not be countenanced.
because, unlike the present case, the writ of execution therein was After the labor arbiters decision is reversed by a higher
secured prior to the reversal of the Labor Arbiters decision. tribunal, the employee may be barred from collecting the
The proposition is tenuous. First, the matter is treated as a mere accrued wages, if it is shown that the delay in enforcing the
race against time. The discussion stopped there without reinstatement pending appeal was without fault on the part of
considering the cause of the delay. Second, it requires the the employer.
issuance of a writ of execution despite the immediately executory The test is two-fold: (1) there must be actual delay or the fact that
nature of the reinstatement aspect of the decision. In Pioneer the order of reinstatement pending appeal was not executed prior
Texturing Corp. v. NLRC,[18] which was cited in Panuncillo v. to its reversal; and (2) the delay must not be due to the employers
CAP Philippines, Inc.,[19] the Court observed: unjustified act or omission. If the delay is due to the employers
x x x The provision of Article 223 is clear that an award [by the unjustified refusal, the employer may still be required to pay the
Labor Arbiter] for reinstatement shall be immediately executory salaries notwithstanding the reversal of the Labor Arbiters
even pending appeal and the posting of a bond by the employer decision.
shall not stay the execution for reinstatement. The legislative intent In Genuino, there was no showing that the employer refused to
is quite obvious, i.e., to make an award of reinstatement reinstate the employee, who was the Treasury Sales Division
immediately enforceable, even pending appeal. To require the Head, during the short span of four months or from the
application for and issuance of a writ of execution as promulgation on of the Labor Arbiters Decision up to the
prerequisites for the execution of a reinstatement award would promulgation on of the NLRC Decision. Notably, the former NLRC
certainly betray and run counter to the very object and intent Rules of Procedure did not lay down a mechanism to promptly
of Article 223, i.e., the immediate execution of a reinstatement effectuate the self-executory order of reinstatement, making it
order. The reason is simple. An application for a writ of execution difficult to establish that the employer actually refused to comply.
and its issuance could be delayed for numerous reasons. A mere In a situation like that in International Container Terminal Services,
continuance or postponement of a scheduled hearing, for Inc. v. NLRC[27] where it was alleged that the employer was
instance, or an inaction on the part of the Labor Arbiter or the willing to comply with the order and that the employee opted not to
NLRC could easily delay the issuance of the writ thereby setting at pursue the execution of the order, the Court upheld the self-
naught the strict mandate and noble purpose envisioned by Article executory nature of the reinstatement order and ruled that the
223. In other words, if the requirements of Article 224 [including salary automatically accrued from notice of the Labor Arbiter's
the issuance of a writ of execution] were to govern, as we so order of reinstatement until its ultimate reversal by the NLRC. It
declared in Maranaw, then the executory nature of a reinstatement was later discovered that the employee indeed moved for the
order or award contemplated by Article 223 will be unduly issuance of a writ but was not acted upon by the Labor Arbiter. In
circumscribed and rendered ineffectual. In enacting the law, the that scenario where the delay was caused by the Labor Arbiter, it
legislature is presumed to have ordained a valid and sensible law, was ruled that the inaction of the Labor Arbiter who failed to act
one which operates no further than may be necessary to achieve upon the employees motion for the issuance of a writ of execution
its specific purpose. Statutes, as a rule, are to be construed in the may no longer adversely affect the cause of the dismissed
light of the purpose to be achieved and the evil sought to be employee in view of the self-executory nature of the order of
remedied. x x x In introducing a new rule on the reinstatement reinstatement.[28]
aspect of a labor decision under Republic Act No. 6715, Congress The new NLRC Rules of Procedure, which took effect on , now
should not be considered to be indulging in mere semantic require the employer to submit a report of compliance within 10
exercise. x x x[20] (Italics in the original; emphasis and calendar days from receipt of the Labor Arbiters decision,[29]
underscoring supplied) disobedience to which clearly denotes a refusal to reinstate. The
The Court reaffirms the prevailing principle that even if the order of employee need not file a motion for the issuance of the writ of
reinstatement of the Labor Arbiter is reversed on appeal, it is execution since the Labor Arbiter shall thereafter motu proprio
obligatory on the part of the employer to reinstate and pay the issue the writ. With the new rules in place, there is hardly any
wages of the dismissed employee during the period of appeal until difficulty in determining the employers intransigence in
immediately complying with the order.
reversal by the higher court.[21] It settles the view that the Labor
Arbiter's order of reinstatement is immediately executory and the In the case at bar, petitioners exerted efforts[30] to execute the
employer has to either re-admit them to work under the same Labor Arbiters order of reinstatement until they were able to
secure a writ of execution, albeit issued on after the reversal by
the NLRC of the Labor Arbiters decision. Technically, there was
still actual delay which brings to the question of whether the delay
was due to respondents unjustified act or omission.
It is apparent that there was inaction on the part of respondent to
reinstate them, but whether such omission was justified depends
on the onset of the exigency of corporate rehabilitation.
It is settled that upon appointment by the SEC of a rehabilitation
receiver, all actions for claims before any court, tribunal or board
against the corporation shall ipso jure be suspended.[31] As
stated early on, during the pendency of petitioners complaint
before the Labor Arbiter, the SEC placed respondent under an
Interim Rehabilitation Receiver. After the Labor Arbiter rendered
his decision, the SEC replaced the Interim Rehabilitation Receiver
with a Permanent Rehabilitation Receiver.
Case law recognizes that unless there is a restraining order, the
implementation of the order of reinstatement is ministerial and
mandatory.[32] This injunction or suspension of claims by
legislative fiat[33] partakes of the nature of a restraining order
that constitutes a legal justification for respondents non-
compliance with the reinstatement order. Respondents failure to
exercise the alternative options of actual reinstatement and payroll
reinstatement was thus justified. Such being the case,
respondents obligation to pay the salaries pending appeal, as the
normal effect of the non-exercise of the options, did not attach.
While reinstatement pending appeal aims to avert the continuing
threat or danger to the survival or even the life of the dismissed
employee and his family, it does not contemplate the period when
the employer-corporation itself is similarly in a judicially monitored
state of being resuscitated in order to survive.
The parallelism between a judicial order of corporation
rehabilitation as a justification for the non-exercise of its options,
on the one hand, and a claim of actual and imminent substantial
losses as ground for retrenchment, on the other hand, stops at the
red line on the financial statements. Beyond the analogous
condition of financial gloom, as discussed by Justice Leonardo
Quisumbing in his Separate Opinion, are more salient distinctions.
Unlike the ground of substantial losses contemplated in a
retrenchment case, the state of corporate rehabilitation was
judicially pre-determined by a competent court and not formulated
for the first time in this case by respondent.
More importantly, there are legal effects arising from a judicial
order placing a corporation under rehabilitation. Respondent was,
during the period material to the case, effectively deprived of the
alternative choices under Article 223 of the Labor Code, not only
by virtue of the statutory injunction but also in view of the interim
relinquishment of management control to give way to the full
exercise of the powers of the rehabilitation receiver. Had there
been no need to rehabilitate, respondent may have opted for
actual physical reinstatement pending appeal to optimize the
utilization of resources. Then again, though the management may
think this wise, the rehabilitation receiver may decide otherwise,
not to mention the subsistence of the injunction on claims.
In sum, the obligation to pay the employees salaries upon the
employers failure to exercise the alternative options under Article
223 of the Labor Code is not a hard and fast rule, considering the
inherent constraints of corporate rehabilitation.
WHEREFORE, the petition is PARTIALLY DENIED. Insofar as the
Court of Appeals Decision of December 5, 2003 and Resolution of
April 16, 2004 annulling the NLRC Resolutions affirming the
validity of the Writ of Execution and the Notice of Garnishment are
concerned, the Court finds no reversible error.
SO ORDERED.
G.R. No. 173076 October 10, 2007 [herein respondents] Jocelyn Resuena, Zonsayda
Emnace, Eddie Villalon and Sylvia Sedayon, their
MT. CARMEL COLLEGE, petitioner,
respective 13th month pay, separation pay and attorney’s
vs.
fee in the total sum of THREE HUNDRED THIRTY-FOUR
JOCELYN RESUENA, EDDIE VILLALON, SYLVIA SEDAYON
THOUSAND EIGHT HUNDRED SEVENTY-FIVE PESOS
and ZONSAYDA EMNACE, respondents.
AND 67/100 (P334,875.47) to be deposited with this
DECISION office within ten (10) days from receipt of this decision.

CHICO-NAZARIO, J.: The complaint for moral and exemplary damages is

hereby dismissed for lack of legal basis.
In this Petition for Review on Certiorari under Rule 45 of the
Revised Rules of Court, petitioner seeks the reversal of the All other claims are hereby dismissed for lack of merit.6
Decision1 dated 2 June 2006 of the Court of Appeals in CA-G.R.
On 9 September 1999, Labor Arbiter Drilon issued to the parties a
CEB-SP No. 01615 entitled, Mt. Carmel College v. National Labor
Notice of Judgment/Decision of his 25 May 1999 Decision. The
Relations Commission, Labor Arbiter Phibun D. Pura, Jocelyn
notice indicated that a "decision of the Labor Arbiter reinstating a
Resuena, et al. Petitioner seeks remedy from this Court for an
dismissed or separated employee, in so far as the reinstatement
alleged illegal execution of the Decision 2 dated 30 October 2001 aspect is concerned, shall immediately be executory, even
by the National Labor Relations Commission (NLRC) in NLRC pending appeal. The employee shall either be admitted back to
CASE No. V-000176-2000 (RAB CASE Nos. 06-06-10393-98; 06- work under the same terms and conditions prevailing prior to his
06-10394-98; 06-06-10395-98; 06-06-10414-98) as affirmed by dismissal or separation or at the option of the employee (sic)
the Court of Appeals in CA-G.R. SP No. 80639 in a Decision 3 merely reinstated in the payroll."7
dated 17 March 2004, insisting it was not in accord with the
dispositive portion thereof. Petitioner is not appealing the judgment In the meantime, petitioner appealed to the NLRC Fourth Division
itself but the manner of execution of the same. in Cebu City, seeking the reversal of the portion of the Labor
Arbiter’s Decision dated 25 May 1999 awarding separation pay to
The following are the factual antecedents of the instant Petition: respondents. The NLRC dismissed the appeal in its Decision
Petitioner Mt. Carmel College is a private educational institution. It dated 30 October 2001. In the same Decision dismissing the
is administered by the Carmelite Fathers at New Escalante, appeal, the NLRC reversed and modified the 25 May 1999
Negros Occidental. Respondents were employees of petitioner, Decision of the Labor Arbiter, and declared the termination of
namely: Jocelyn Resuena (Accounting Clerk), Eddie Villalon respondents to be illegal. It ordered the reinstatement of
(Elementary Department Principal); Sylvia Sedayon (Treasurer), respondents, with payment of backwages or payment of
and Zonsayda Emnace (Secretary to the Director). separation pay in lieu thereof. The pertinent portion of the 30
October 2001 NLRC Decision reads:
On 21 November 1997, respondents, together with several faculty
members, non-academic personnel, and other students, We rule that complainants were illegally dismissed and
participated in a protest action against petitioner. Thereafter, must therefore be ordered reinstated with payment of
petitioner’s Director, Rev. Fr. Modesto E. Malandac, issued a backwages from the time they were illegally dismissed up
Memorandum to each of the respondents. The Memorandum to the time of their actual reinstatement.
directed respondents to explain in writing why they should not be All other claims are hereby dismissed for lack of merit.
dismissed for loss of trust and confidence for joining the protest
action against the school administration. Petitioner maintained that WHEREFORE, premises considered the instant appeal is
respondents were occupying positions of highly confidential hereby DISMISSED for lack of merit and the appealed
nature. After a hearing conducted by petitioner’s Fact-Finding decision is hereby AFFIRMED with modification ordering
Committee and submission of its Report on 25 April 1998, the [herein petitioner] the payment of the backwages of
recommending dismissal or suspension of respondents, petitioner the [herein respondents] from May 15, 1998 up to May
issued written notices of termination to respondents on 7 May 25, 1999, further directing the reinstatement of the
1998. Respondents were terminated by petitioner on 15 May [respondents] to their original positions without loss of
1998. seniority or in lieu thereof the payment of their separation
pay as computed in the appealed decision.8
Separate complaints were filed by each of the four respondents
against petitioner before Regional Arbitration Branch VI of the Petitioner filed a Motion for Reconsideration of the 30 October
NLRC in Bacolod City. Respondents charged petitioner with illegal 2001 Decision of the NLRC. The said Motion was denied in the 19
dismissal and claimed 13th month pay, separation pay, damages June 2003 Resolution of the NLRC.
and attorney’s fees. The cases were docketed as RAB Cases No.
06-06-10393-98, 06-06-10394-98, 06-06-10395-98, and 06-06- The case was elevated to the Court of Appeals via a Special Civil
10414-98. All four cases were consolidated, and Labor Arbiter Ray Action for Certiorari and Prohibition, docketed as CA-G.R. SP No.
80639 where petitioner assailed the aforementioned NLRC
T. Drilon thereafter issued a Decision 4 dated 25 May 1999
Decision dated 30 October 2001 and Resolution dated 19 June
affirming the validity of respondents’ termination by petitioner on
2003, arguing that there is more than enough basis for loss of trust
the ground of loss of trust and confidence. Although the Decision
and confidence as ground for dismissing respondents. It also
found respondents to have been legally dismissed, as equitable
reiterated compliance with the twin requirements of notice and
relief, however, they were awarded separation pay computed at
hearing. The Court of Appeals denied the petition in a Decision
one month pay for every year of service, 5 their proportionate 13th promulgated on 17 March 2004, ruling thus:
month pay, and attorney’s fees. Their claims for moral and
exemplary damages were denied. In issuing the aforesaid Consequently, we find no grave abuse of discretion
Decision, the Labor Arbiter ruled: committed by the NLRC in ruling that [herein
respondents] have been illegally dismissed. Likewise,
WHEREFORE, premises considered, judgment is hereby said [NLRC] correctly held that even if such participation
rendered ordering [herein petitioner] Mount Carmel of [respondents] in the protest picket is rather improper
College represented by Fr. Modesto Malandac to pay under the circumstances or disappointing to the School
 Administrator who had rightly expected them to take the Successive writs of execution pertaining to the backwages and
side of the administration or at least stayed neutral on the accrued salaries of the respondents were issued by Labor Arbiter
demand for ouster of Fr. Malandac and Barairo, dismissal Pura on these dates: 9 June 2003,10 10 December 2003,11 and 20
is definitely too harsh where a less punitive action such January 2004.12
as reprimand or disciplinary action would have been
sufficient. Considering the long years of faithful service of
The first writ of execution, issued on 9 June 2003, directed the
[respondents] in the School without previous record of sheriff to collect from petitioner, the amount of P503,028.05
misconduct, as duly noted by the NLRC in its decision, representing backwages from 15 May 1998 to 25 May 1999.
their termination on the basis of alleged loss of Based on the Sheriff’s Report dated 25 June 2003, reinstatement
confidence by taking part in an otherwise legitimate and had not been effected. There was a Notice of Garnishment issued
constitutionally-protected right to free speech and to the Equitable-PCI Bank Escalante Branch. Labor Arbiter Pura
peaceful assembly, is certainly illegal and unjustified. ordered the release of the garnished amount of P508,168.05 with
the said bank for deposit to the Cashier of NLRC Regional
xxxx Arbitration Branch VI in Bacolod City. Petitioner moved to quash
Having been illegally dismissed, [respondents] are the Writ of Execution dated 9 June 2003. It was denied.
entitled to back wages from the time of their termination By 4 December 2003, the NLRC entered in its Book of Entries of
until reinstatement, and if reinstatement is no longer Judgment its Decision dated 30 October 2001. The records of the
possible, the grant of separation pay equivalent to one (1) case were endorsed back to NLRC Regional Arbitration Branch VI
month for every year of service. However, in this case for the execution of its final and executory decision, as no
since the Labor Arbiter did not order reinstatement, the restraining order was issued by the Court of Appeals.
NLRC correctly excluded the period of the appeal in the
computation of back wages due to [respondents]. After an exchange of pleadings, respondents filed an Ex-Parte
Motion for Issuance of Writ of Execution with the Labor Arbiter
Finally, on the prayer for injunctive relief sought by considering that the Entry of Judgment was already issued by the
petitioner on the ground that [public respondent] Labor NLRC. On 10 December 2003, the Labor Arbiter granted the
Arbiter exceeded his jurisdiction in issuing the writ of Motion and issued the second Writ of Execution. On motion of
execution despite the fact that his decision did not order respondents, the Labor Arbiter ordered the release to them of the
reinstatement and that he is bereft of authority to garnished amount of P503,028.05 deposited with the Cashier of
implement the decision of the NLRC (Fourth Division). NLRC Regional Arbitration Branch VI.
xxxx However, the foregoing amount was considered to be only a
Considering that there is already an entry of judgment on partial payment of the monetary awards due the respondents and
the Decision dated October 30, 2001, and in view of Our the unpaid balance thereof continued to grow to P1,307,806.50.
disposition of this petition, we find no more obstacle for Respondents thus filed a motion for partial writ of execution, which
the enforcement of the said judgment even pending the Labor Arbiter granted by issuing the third Writ of Execution on
appeal, in accordance with Sections 1 and 2, Rule VIII of 20 January 2004.13 Under the foregoing writs of execution, the
the NLRC Rules of Procedure, as amended, as well as aggregate amount of P1,736.592.0814 was garnished by
Sections 2, 4 and 6, Rule III of the NLRC Manual on Bailiff/Acting Sheriff Romeo D. Pasustento, representing
Execution of Judgment. respondents’ accrued salaries, backwages, attorney’s fees and
sheriff’s fees computed from the promulgation of the NLRC
xxxx Decision 30 October 2001.
WHEREFORE, premises considered, the present petition Respondents filed on 14 July 2004 yet another Motion to Issue a
is hereby DENIED DUE COURSE and accordingly Writ of Execution to collect backwages from 1 January 2004 to 30
DISMISSED for lack of merit. The assailed Decision and June 2004. Petitioner opposed the motion, but the Motion to Issue
Resolution are AFFIRMED.9 a Writ of Execution was granted.
No Motion for Reconsideration of the afore-quoted Court of On 31 January 2005, Labor Arbiter Pura issued an Order 15
Appeals Decision in CA-G.R. SP No. 80639 was filed and it adopting the computation of the Fiscal Examiner of NLRC
became final and executory on 14 April 2004. Regional Arbitration Branch VI and issuing a writ of execution to
At about the same time as the foregoing developments in CA-G.R. enforce the NLRC Decision dated 30 October 2001. The
SP No. 80639, Labor Arbiter Phibun D. Pura issued an Order on dispositive portion of the said Order reads:
19 May 2003 opining on the self-executory nature of a In light of the foregoing, we have no choice but to adopt
reinstatement order: the computation of the RAB Fiscal Examiner, hereto
To be sure the Court has not been consistent in its attached and forming part of the record of these cases
interpretation of Art. 223. The nagging issue has always and conformably thereto, we grant the Motion to Issue
been whether the reinstatement order is self-executory. Writ of Execution on backwages for the period stated in
Citing the divergent views of the court beginning with this computation, taking into consideration the grant of
Inciong v. NLRC followed by the deviation in interpretation differentials as there are benefits which accrued to the
in Maranaw Hotel Corporation (Century Park Sheraton [herein respondents] and which they should have enjoyed
Manila) v. NLRC, as reiterated and adopted in Archilles had they been employed and/or reinstated, as the case
Manufacturing Corporation v. NLRC and Purificacion Ram may be, and such other amount as may accrue until
v. NLRC, the Court in the 1997 Pioneer case has laid actually reinstated or in lieu of reinstatement, to pay
down the doctrine that henceforth an Order or award for [respondents] separation pay to be computed at one (1)
reinstatement is self-executory, meaning that it does not month salary for every year of service in addition to
require a writ of execution, much less a motion for its backwages the formula adopted by the Labor Arbiter in
issuance, as maintained by petitioner. x x x. the Decision dated May 25, 1999, page 7, paragraph 1.
Let therefore a Writ of Execution be, as it is hereby issued
 to enforce judgment in the above entitled cases.16 First, there is no showing, in the case at bench, that
petitioner exercised its option to reinstate private
On 8 February 2005, petitioner filed a Motion for Reconsideration respondents to their former position or to grant them
of the foregoing Order contending that the judgment of the NLRC separation pay. Accordingly, backwages have to be
mandated the payment of separation pay as computed in the granted to private respondents until their reinstatement to
appealed decision. Respondents likewise filed a Manifestation and their former position is effected or upon petitioner’s
Motion to include the month of November 2004 in the computation. payment of separation pay to private respondents if
In an Order dated 10 February 2005, the Labor Arbiter denied the reinstatement is no longer feasible; and
petitioner’s Motion for Reconsideration. On 22 February 2005, he
issued an Alias Writ of Execution17 for the collection from Second, the decision dated March 17, 2004 of the 17th
petitioner of the amount of P1,131,035.00 representing Division of the Court of Appeals in CA-G.R. SP No. 80639
respondents’ backwages, separation pay, and attorney’s fees. acquiesced the propriety of the issuance of the writs of
Petitioner filed a Motion to Quash the Alias Writ of Execution on 17 execution by the respondent labor arbiter on June 9,
March 2005.18 2003, December 10, 2003 and January 30, 2004. On
April 14, 2004, the said decision which sanctioned the
On 15 April 2005, the Labor Arbiter issued an Order where it found payment of backwages even beyond May 25, 1999,
no compelling reason to warrant the grant of the Motion to Quash became final and executory x x x.
the Alias Writ of Execution. The afore-stated Order thus reads:
xxxx
WHEREFORE, for lack of merit the Motion to Quash the
Alias Writ dated March 17, 2005 is denied. In light of the foregoing disquisition, we hereby find public
[Respondents’] Motion to Include February and March respondent NLRC to have acted accordingly and without
2005 in the Computation of wages is hereby GRANTED. grave abuse of discretion when it issued the questioned
The entry of appearance of the collaborating counsel is Resolutions dated August 15, 2005 and November 30,
2005, respectively. Grave abuse of discretion means such
duly noted.19
capricious and whimsical exercise of judgment as is
From the said Order of the Labor Arbiter, petitioner filed with the equivalent to lack of jurisdiction, or, in other words where
NLRC an appeal with an application for issuance of a writ of the power is exercised in an arbitrary or despotic manner
preliminary injunction on the execution of judgment, docketed as by reason of passion or personal hostility, and it must be
NLRC Case No. V-000377-05. Petitioner assailed the 15 April so patent and gross as to amount to an evasion of
2005 Order of the Labor Arbiter averring that the latter seriously positive duty or to a virtual refusal to perform the duty
committed errors when he ordered the payment and garnishment enjoined or to act at all in contemplation of law. It is not
of backwages beyond the period 15 May 1998 to 25 May 1999. sufficient that a tribunal, in the exercise of power, abused
The NLRC dismissed the petitioner’s appeal in a Resolution 20 its discretion; such abuse must be grave.
dated 15 August 2005 for lack of merit. Petitioner filed a Motion for WHEREFORE, in view of the foregoing, the present
Reconsideration but it was denied by the NLRC in a Resolution petition is hereby DISMISSED and the assailed
dated 30 November 2005, disposed of as follows: Resolutions dated August 15, 2005 and November 30,
WHEREFORE, premises considered, the appeal of 2005, respectively, issued by the respondent NLRC in
respondents is hereby DISMISSED for lack of merit. The NLRC Case No. V-000377-05 are hereby AFFIRMED.23
15 April 2005 Order of Labor Arbiter Phibun Pura is
Hence, petitioner filed the instant Petition for Review on Certiorari,
AFFIRMED.21 raising the following issues:
From the foregoing, petitioner filed with the Court of Appeals a I.
Special Civil Action for Certiorari and Prohibition, docketed as CA-
G.R. CEB-SP No. 01615, praying for the setting aside and THE HONORABLE COURT OF APPEALS ERRED IN
nullification of the Resolutions dated 15 August 2005 and 30 UPHOLDING THE LABOR ARBITER AND THE NLRC
November 2005 of the NLRC in NLRC Case No. V-000377-05. THAT THE AWARD OF BACKWAGES GOES BEYOND
Petitioner contended that the NLRC acted with grave abuse of THE PERIOD FROM 15 MAY 1998 UP TO 25 MAY 1999
discretion when it denied its appeal and motion for reconsideration ON THE SUPPOSITION THAT REINSTATEMENT IS
and in not ruling that there was already satisfaction of judgment. SELF-EXECUTORY AND DOES NOT NEED A WRIT OF
The crux of petitioner’s case, as succinctly worded by the Court of EXECUTION FOR ITS ENFORCEMENT.
Appeals in CA-G.R. CEB-SP No. 01615:
II.
[P]etitioner seeks to annul and set aside the resolutions
dated August 15, 2005 and November 30, 2005 of the THE HONORABLE COURT OF APPEALS ERRED IN
respondent NLRC in NLRC Case No. V-000377-05 when NOT FINIDING THAT THE CONTINUING GRANT AND
the latter refuses to invalidate the various writs of AWARD OF BACKWAGES UP TO THE PRESENT IS
executions and to refund petitioner of whatever excess CONTRARY TO LAW AND JURISPRUDENCE AS LAID
there might be on the theory that the execution done by DOWN BY THIS HONORABLE SUPREME COURT.
the respondent Labor Arbiter was illegal and in fact goes Petitioner prays that this Court render judgment (a) annulling and
beyond what is stated in the decision dated October 30, setting aside the assailed Decision on 02 June 2006 of the Court
2001 of the respondent NLRC in NLRC Case No. V- of Appeals in CA-G.R. CEB-SP No. 01615 and all its orders and
000176-2000.22 issuances; (b) ordering that backwages be computed and
executed corresponding only to the period from 15 May 1998 to 25
The Court of Appeals eventually dismissed CA-G.R. CEB-SP No.
May 1999; (c) ordering that separation pay be computed based on
01615, ruling as follows:
the computation as originally submitted by the Labor Arbiter,
Thus, petitioner’s avowal that their liability for private P344,875.47, which corresponds to the date of respondents’
respondents’ backwages is limited from May 15, 1998 up employment until 15 May 1998; (d) that no other award except for
to May 25, 1999 is untenable on these grounds: backwages for the period 15 May 1998 to 25 May 1999 and
separation pay amounting to P344,875.47 shall be paid by Corporation v. National Labor Relations Commission 30 where this
petitioner; and (e) that the respondents be ordered to refund and Court ruled:
pay the alleged excess in the amounts garnished by virtue of the
Writs of Execution dated 9 June 2003, 10 December 2003, and 30 In other words, reinstatement during appeal is warranted
January 2004. only when the labor arbiter (LA) himself rules that the
dismissed employee should be reinstated. In the present
In sum, the resolution of this petition hinges on the following case, neither the dispositive portion nor the text of the
issues: (1) whether reinstatement in the instant case is self- labor arbiter’s decision ordered the reinstatement of
executory and does not need a writ of execution for its private respondent. Further, the back wages granted to
enforcement; and (2) whether the continuing award of backwages private respondent were specifically limited to the period
is proper. prior to the filing of the appeal with Respondent NLRC. In
fact, the LA’s decision ordered her separation from
Petitioner insists that what is at issue is the manner of execution of
service for the parties’ "mutual advantage and most
the NLRC Decision dated 30 October 2001 in NLRC CASE No. V-
importantly to physical and health welfare of the
000176-2000 (RAB CASE Nos. 06-06-10393-98; 06-06-10394-98;
complainant." Hence, it is an error and an abuse of
06-06-10395-98; 06-06-10414-98), as affirmed by the Decision
discretion for the NLRC to hold that the award of limited
dated 17 March 2004 of the Court of Appeals in CA-G.R. No.
back wages, by implication, included an order for private
80639.
respondent’s reinstatement.
In ruling on the consolidated complaints filed by the four
An order for reinstatement must be specifically declared
respondents, Labor Arbiter Drilon found that they were not illegally
th
and cannot be presumed; like back wages, it is a
dismissed but ordered that they be awarded 13 month pay, separate and distinct relief given to an illegally dismissed
separation pay and attorney’s fees in the amount of P334,875.47. employee. There being no specific order for reinstatement
Upon appeal to the NLRC, the NLRC reversed the findings of the and the order being for complainant’s separation, there
Labor Arbiter ruling that the termination of respondents was illegal can be no basis for the award of salaries/back wages
and ordering the payment of backwages of respondents from 15 during the pendency of appeal.
May 1998 up to 25 May 1999. It further directed the reinstatement
of respondents or payment of separation pay, with backwages. Petitioner’s reliance on Filflex is misplaced and inapplicable to the
This was affirmed by the Court of Appeals. case at bar. Indeed in Filflex, this Court ruled that the award of
backwages is limited to the period prior to the filing of the appeal
While petitioner concedes that the case pertaining to the with the NLRC. This Court had declared in the aforesaid case that
complaints for illegal dismissal filed by the respondents before the reinstatement during appeal is warranted only when the Labor
Labor Arbiter had been resolved with finality by the Court of Arbiter himself rules that the dismissed employee should be
Appeals in CA-G.R. No. 80639, no other remedy having been reinstated. But this was precisely because on appeal to the NLRC,
taken therefrom, it however assails the correctness and validity of it found that there was no illegal dismissal; thus, neither
the execution of the judgment therein. Petitioner avers that the reinstatement nor backwages may be awarded. In fact, Filfex
Court of Appeals erred in upholding the Labor Arbiter and the deleted the award of backwages granted during appeal, reiterating
NLRC that the award of backwages goes beyond the period 15 that an award of backwages by the NLRC during the period of
May 1998 to 25 May 1999 on the supposition that reinstatement is appeal is totally inconsistent with its finding of a valid dismissal. In
self-executory and does not need a writ of execution for its the instant petition, the NLRC Decision dated 30 October 2001
enforcement. Petitioner postulates that the Labor Arbiter went finding the termination of respondents illegal, had the effect of
beyond the terms of the NLRC Decision, as affirmed by the Court reversing Labor Arbiter Drilon’s Decision dated 25 May 1999.
of Appeals, and erroneously used as bases inapplicable law24 and
jurisprudence25 in the execution of the same. Petitioner contends This Court sees no cogent reason as to the relevance of a
that the Labor Arbiter’s reliance on Pioneer Texturizing Corp. v. discussion on whether or not reinstatement is self-executory.
However, since petitioner raised this issue, this Court has opted to
National Labor Relations Commission26 is misplaced, for it applied
discuss it. Verily, Article 223 of the Labor Code is not applicable in
Article 223 of the Labor Code 27 since reinstatement was ordered the instant case. The said provision stipulates that the decision of
at the Labor Arbiter’s level while in the instant case, reinstatement the Labor Arbiter reinstating a dismissed or separated employee,
was ordered upon appeal to the NLRC. Petitioner argues that the insofar as the reinstatement aspect is concerned, shall
relevant statutory and regulatory provisions herein are Article 224 immediately be executory, even pending appeal.
of the Labor Code,28 and Rule III of the NLRC Manual for
Execution of Judgment,29 given that there was no order of Petitioner contends that the statutory provision applicable is Article
reinstatement at the Labor Arbiter level but only at the NLRC level. 224 of the Labor Code, as well as Rule III, Section 2(b) of the
Petitioner insists that, applying Article 224 of the Labor Code in the NLRC Manual on Execution of Judgment, because the case was
instant case, any reinstatement aspect of the NLRC Decision, as decided on appeal. Furthermore, it is a decision which is of a final
affirmed by the Court of Appeals, should have been done through and executory nature. The provisions invoked by petitioner reads:
the issuance of a Writ of Execution as it is no longer self- Art. 224. Execution of decisions, orders or awards. --
executory. It furthermore contends that it was impossible to (a) The Secretary of Labor and Employment or any
reinstate respondents, whether by way of an immediate execution Regional Director, the Commission or any Labor Arbiter,
or by way of a self-executory nature, since there was nothing to or med-arbiter or voluntary arbitrator may, motu proprio or
execute pending appeal because there was no order for on motion of any interested party, issue a writ of
reinstatement. execution on a judgment within five (5) years from the
Petitioner vehemently raises the argument that the award of date it becomes final and executory x x x.31
backwages subject to execution is limited to the period prior to the
If the execution be for the reinstatement of any person to
appeal and does not include the period during the pendency of the
any position, office or employment, such writ shall be
appeal, on the contention that reinstatement during appeal is
served by the sheriff upon the losing party or upon any
warranted only when the Labor Arbiter rules that the dismissed
other person required by law to obey the same, and such
employee should be reinstated. In support of its foregoing
party or person may be punished for contempt if he
argument, petitioner invokes Filflex Industrial & Manufacturing
 disobeys such decisions, order for reinstatement.32 supposed to execute.

The records of the case indicate that when Labor Arbiter Drilon Petitioner’s argument is absurd. Abbott v. National Labor
issued its 25 May 1999 Decision, there was no order of Relations Commission,36 as cited by petitioner, declared that there
reinstatement yet although the dispositive portion of the 31 exists a big difference when what is sought to be reviewed is the
January 2005 Order issued by Labor Arbiter Pura already provided manner of execution of a decision and not the decision itself.
for reinstatement or payment of separation pay, to wit: "While it is true that the decision itself has become final and
executory and so can no longer be challenged, there is no
In light of the foregoing, we have no choice but to adopt question that it must be enforced in accordance with its terms and
the computation of the RAB Fiscal Examiner, hereto conditions. Any deviation therefrom can be the subject of a proper
attached and forming part of the record of these cases
appeal."37 In the instant case, however, the manner of execution
and conformably thereto, we grant the Motion to Issue
falls squarely within the terms of the Decision it seeks to
Writ of Execution on backwages for the period stated in
implement.
this computation, taking into consideration the grant of
differentials as there are benefits which accrued to the The 30 October 2001 NLRC Decision ruled as follows:
complainants and which they should have enjoyed had
they been employed and/or reinstated, as the case may We rule that complainants were illegally dismissed and
be, and such other amount as may accrue until actually must therefore be ordered reinstated with payment of
reinstated or in lieu of reinstatement, to pay complainants backwages from the time they were illegally dismissed up
separation pay to be computed at one (1) month salary to the time of their actual reinstatement.
for every year of service in addition to backwages the
All other claims are hereby dismissed for lack of merit.
formula adopted by the Labor Arbiter in the Decision
dated May 25, 1999, page 7, paragraph 1. WHEREFORE, premises considered the instant appeal is
hereby DISMISSED for lack of merit and the appealed
Let therefore a Writ of Execution be, as it is hereby issued
decision is hereby AFFIRMED with modification ordering
to enforce judgment in the above entitled cases.33 the respondents the payment of the backwages of the
Art. 223 of the Labor Code provides that reinstatement is complainants from May 15, 1998 up to May 25, 1999,
immediately executory even pending appeal only when the Labor further directing the reinstatement of the complainants to
Arbiter himself ordered the reinstatement. In this case, the original their original positions without loss of seniority or in lieu
Decision of Labor Arbiter Drilon did not order reinstatement. thereof the payment of their separation pay as computed
Reinstatement in this case was actually ordered by the NLRC, in the appealed decision.38
affirmed by the Court of Appeals. The order of Labor Arbiter Pura
When the afore-quoted NLRC Decision was appealed to the Court
on 31 January 2005 directing reinstatement was issued after the
of Appeals in CA-G.R. SP No. 80639, there seemed to be a
Court of Appeals Decision dated 17 March 2004 which affirmed
contradiction between the body and the fallo of the appellate
the NLRC’s order of reinstatement. Thus, Art. 223 finds no
court’s Decision dated 17 March 2004. Petitioner cites the
application in the instant case. Considering that the order for
following from the text of the Court of Appeals Decision:
reinstatement was first decided upon appeal to the NLRC and
affirmed with finality by the Court of Appeals in CA-G.R. SP 80369 However, in this case since the Labor Arbiter did not order
on 17 March 2004, petitioner rightly invoked Art. 224 of the Labor reinstatement, the NLRC correctly excluded the period of
Code. As contemplated by Article 224 of the Labor Code, the the appeal in the computation of back wages due to
Secretary of Labor and Employment or any Regional Director, the private respondents.39
Commission or any Labor Arbiter, or med-arbiter or voluntary
arbitrator may, motu proprio or on motion of any interested party, The dispositive portion of the same Decision, however, concludes:
issue a writ of execution on a judgment within five (5) years from
the date it becomes final and executory. Consequently, under Rule WHEREFORE, premises considered, the present petition
III of the NLRC Manual on the Execution of Judgment, it is is hereby DENIED DUE COURSE and accordingly
provided that if the execution be for the reinstatement of any DISMISSED for lack of merit. The assailed Decision and
person to a position, an office or an employment, such writ shall Resolution are AFFIRMED.40
be served by the sheriff upon the losing party or upon any other
The general rule is that where there is conflict between the
person required by law to obey the same, and such party or
dispositive portion or the fallo and the body of the decision, the
person may be punished for contempt if he disobeys such decision
34 fallo controls. This rule rests on the theory that the fallo is the final
or order for reinstatement. order while the opinion in the body is merely a statement ordering
41
However, as we can glean from the succeeding discussion, the nothing. Clearly, the award of backwages to respondents does
above findings will not affect the award of backwages for the not merely cover the period from 15 May 1998 up to 25 May 1999
period beyond 25 May 1999. alone.42 The findings of the NLRC, which were affirmed with
finality in CA-G.R. SP No. 80639, and subject of execution in the
Anent the second issue, petitioner contends that the 25 May 1999 instant petition, pronounced:
Decision of Labor Arbiter Drilon did not order the reinstatement of
respondents. Petitioner posits that since there was no finding of We rule that [respondents] were illegally dismissed and
illegal dismissal at the Labor Arbiter’s level, then it follows that must therefore be ordered reinstated with payment of
there was no reinstatement aspect, and its liability for backwages backwages from the time they were illegally dismissed up
is limited to the period from 15 May 1998 up to 25 May 1999, i.e., to the time of their actual reinstatement.
from dismissal to promulgation of the Labor Arbiter’s Decision only,
as allegedly determined by the NLRC in its Decision dated 30 All other claims are hereby dismissed for lack of merit.
October 2001. It argues that while the said NLRC Decision WHEREFORE, premises considered the instant appeal is
awarded backwages from 15 May 1998 to 25 May 1999 only, the hereby DISMISSED for lack of merit and the appealed
Writs of Execution issued pursuant thereto ordered the payment of decision is hereby AFFIRMED with modification ordering
backwages way beyond the period stated in the Decision 35 it is the [petitioner] payment of the backwages of the
 [respondents] from May 15, 1998 up to May 25, 1999, its obligation to respondents, insofar as accrued backwages and
further directing the reinstatement of the [respondents] to other benefits are concerned, continues to accumulate.
their original positions without loss of seniority or in lieu
thereof the payment of their separation pay as computed This Court takes this occasion to reiterate that execution is the
final stage of litigation, the end of the suit. It can not and should
in the appealed decision.43
not be frustrated except for serious reasons demanded by justice
The above ruling of the NLRC in its Decision dated 30 October and equity.47 "Litigation must end sometime and somewhere. An
2001 had the effect of reversing and modifying the findings of the effective and efficient administration of justice requires that, once a
Labor Arbiter. Under Article 218(c) of the Labor Code, the judgment has become final, the winning party be not, through a
Commission is empowered to "correct, amend, or waive any error, mere subterfuge, be deprived of the fruits of the verdicts. Courts
defect or irregularity whether in substance or form," in the exercise must, therefore, guard against any scheme calculated to bring
of its appellate jurisdiction.44 The dispositive portion of the Labor about that result. Constituted as they are to put an end to
Arbiter’s Decision as worded is clear and needs no further controversies, courts should frown upon any attempt to prolong
interpretation. The NLRC found respondents to have been illegally them."48
dismissed by petitioner, and ordered reinstatement and payment
of backwages. Additionally, it stated that where reinstatement is WHEREFORE, the instant petition is dismissed. The Decision
not possible, separation pay as computed in the appealed dated 2 June 2006 of the Court of Appeals in CA-G.R. CEB-SP
decision should be awarded to respondents. Petitioner interprets No. 01615 is AFFIRMED. Petitioner is ORDERED to (1) reinstate
the dispositive portion of the NLRC Decision to mean that it is respondents to their original positions without loss of seniority
ordered to pay respondents backwages from 15 May 1998 to 25 rights, with payment of (a) backwages computed from 15 May
May 1999 only. Petitioner seems to have missed that the 1998, the time compensation of respondents was withheld from
aforestated NLRC Decision also directed it to reinstate them when they were unjustly terminated, up to the time of
respondents, or in lieu thereof, pay separation pay. This, petitioner reinstatement; and (b) accrued 13th month pay for the same
failed to do. Petitioner did not exercise the option of either period; OR in lieu of reinstatement, (2) pay respondents (a)
reinstatement or paying the separation pay of respondents. separation pay, in the amount equivalent to one (1) month pay for
every year of service; and (b) backwages, computed from 15 May
Backwages are to be computed from the time of illegal dismissal 1998, the time compensation of respondents was withheld from
until reinstatement or upon petitioner’s payment of separation pay them when they were unjustly terminated, up to the time of
to respondents if reinstatement is no longer possible. Article 279 of payment thereof; and (c) the accrued 13th month pay for the same
the Labor Code, as amended, states: period. For this purpose, the records of this case are hereby
REMANDED to the Labor Arbiter for proper computation of the
Art. 279. Security of Tenure. – x x x
subject money claims as discussed above. Costs against
In cases of regular employment the employer shall not petitioner.
terminate the services of an employee except for a just
SO ORDERED.
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.
Thus, an illegally dismissed employee is entitled to two reliefs:
backwages and reinstatement. The two reliefs provided are
separate and distinct. In instances where reinstatement is no
longer feasible because of strained relations between the
employee and the employer, separation pay is granted. In effect,
an illegally dismissed employee is entitled to either reinstatement,
if viable, or separation pay if reinstatement is no longer viable, and
backwages.45
The normal consequences of respondents’ illegal dismissal, then,
are reinstatement without loss of seniority rights, and payment of
backwages computed from the time compensation was withheld
up to the date of actual reinstatement. Where reinstatement is no
longer viable as an option, separation pay equivalent to one (1)
month salary for every year of service should be awarded as an
alternative.46 The payment of separation pay is in addition to
payment of backwages.
Concomitantly, it is evident that respondents’ backwages should
not be limited to the period from 15 May 1998 to 25 May 1999.
The backwages due respondents must be computed from the time
they were unjustly dismissed until their actual reinstatement to
their former position or upon petitioner’s payment of separation
pay to them if reinstatement is no longer feasible. Thus, until
petitioner actually implements the reinstatement aspect of the
NLRC Decision dated 30 October 2001, as affirmed in the Court of
Appeals Decision dated 17 March 2004 in CA-G.R. SP No. 80639,
 order of reinstatement and subsequent appeal/order denying the
LUNESA O. G.R. No. 177026 quashal of the alias writ of execution and lifting of the notice of
LANSANGAN garnishment, the NLRC, by Resolution of June 30, 2005,[9]
AND ROCITA Present: granted respondents appeals by deleting the reinstatement aspect
CENDAA, of the Arbiters decision and setting aside the Arbiters Alias Writ of
Execution and Notice of Garnishment. Thus the NLRC disposed
QUISUMBING, J., Chairperson, as follows:
Petitioners,
CORONA,*
CARPIO MORALES, ACCORDINGLY, the appeal is hereby GRANTED. The Labor
- versus - TINGA, and Arbiters Decision dated October 20, 2004 is hereby MODIFIED by
DELETING the portion that ruled for appelle[e]s reinstatement.
AMKOR Consequently, the Writ of Execution dated November 19, 2004,
BRION, JJ. the subsequent Alias Writ of Execution dated January 26, 2005,
TECHNOLOGY
PHILIPPINES, and the Notice of Garnishment dated January 14, 2005 served
INC., Promulgated: upon Equitable PCI Bank by Sheriff Agripina Sangel are hereby
ordered to be SET ASIDE.

Respondent. January 30, 2009 SO ORDERED. (Underscoring supplied)

Petitioners motion for reconsideration of the NLRC Resolution
having been denied, they filed a petition for certiorari before the
DECISION Court of Appeals which, by Decision[10] of September 19, 2006,
while affirming the finding that petitioners were guilty of
CARPIO MORALES, J.:
misconduct and the like, ordered respondent to pay petitioners
An anonymous e-mail was sent to the General Manager of Amkor their corresponding backwages without qualification and deduction
Technology Philippines (respondent) detailing allegations of for the period covering October 20, 2004 (date of the Arbiters
malfeasance on the part of its supervisory employees Lunesa decision) up to June 30, 2005 (date of the NLRC Decision), citing
Lansangan and Rosita Cendaa (petitioners) for stealing company Article 223 of the Labor Code and Roquero v. Philippine Airlines.
time.[1] Respondent thus investigated the matter, requiring [11]
petitioners to submit their written explanation. In handwritten
Both parties filed their respective motions for partial
letters, petitioners admitted their wrongdoing.[2] Respondent
reconsideration which were denied.[12] Only petitioners have
thereupon terminated petitioners for extremely serious offenses as
come to this Court via the present petition for review,[13]
defined in its Code of Discipline,[3] prompting petitioners to file a
contending that:
complaint for illegal dismissal against it.[4]
I
Labor Arbiter Arthur L. Amansec, by Decision of October 20, 2004,
[5] dismissed petitioners complaint, he having found them guilty of WITH ALL DUE RESPECT, THE ORDER OF THE HONORABLE
COURT OF APPEALS LIMITING THE PAYMENT OF
[s]wiping another employees [sic] I.D. card or requesting another
BACKWAGES [TO] THE PETITIONERS FROM (ARBITER
employee to swipe ones I.D. card to gain personal advantage
DECISION) UP TO (NLRC DECISION) ONLY IS CONTRARY TO
and/or in the interest of cheating, an offense of dishonesty
THE CASE OF ALEJANDRO ROQUERO VS. PHILIPPINE
punishable as a serious form of misconduct and fraud or breach of
AIRLINES, INC.[,] G.R. NO. 152329, APRIL [22,] 2003 [AND]
trust under Article 282 of the Labor Code:
II
xxxx
. . . THE HONORABLE COURT OF APPEALS COMMITTED
which allows the dismissal of an employee for a valid cause.
GRAVE ABUSE OF DISCRETION IN CONCLUDING THAT THE
(Emphasis and underscoring supplied)
PETITIONERS COMMITTED SERIOUS MISCONDUCT, FRAUD,
The Arbiter, however, ordered the reinstatement of petitioners to DISHONESTY AND BREACH OF TRUST. BUT EVEN
their former positions without backwages as a measure of ASSUMING THAT THE PETITIONERS COMMITTED THE
equitable and compassionate relief owing mainly to petitioners SWIPING IN OF IDENTIFICATION CARD, THE PENALTY OF
prior unblemished employment records, show of remorse, DISMISSAL IS TOO SEVERE, HARSH AND CONTRARY TO
harshness of the penalty and defective attendance monitoring ARTICLE 282 OF THE LABOR CODE OF THE PHILIPPINES
system of respondent.[6] AND EXISTING JURISPRUDENCE.[14]

Respondent assailed the reinstatement aspect of the Arbiters Since respondent did not appeal from the appellate courts
order before the National Labor Relations Commission (NLRC). decision, the said courts order for it to pay backwages to
petitioners for the therein specified period has become final.
In the meantime, petitioners, without appealing the Arbiters finding
them guilty of dishonesty as a form of serious misconduct and Petitioners highlight the Courts ruling in Roquero v. Philippine
fraud or breach of trust, moved for the issuance of a writ of Airlines[15] where the therein employer was ordered to pay the
reinstatement.[7] wages to which the therein employee was entitled from the time
the reinstatement order was issued until the finality of this Courts
After a series of oppositions, motions and orders,[8] the Arbiter decision[16] in favor of the therein employee. Thus, petitioners
issued an alias writ of execution following which respondents bank contend that the payment of backwages should not be computed
account at Equitable-PCI Bank was garnished. Respondent only up to the promulgation by the NLRC of its decision.
thereupon moved for the quashal of the alias writ of execution and
lifting of the notice of garnishment, which the Arbiter denied by In its Comment,[17] respondent asserts that, inter alia, petitioners
Order of January 26, 2005, drawing respondent to appeal to the reliance on Roquero is misplaced in view of the glaring factual
NLRC. differences between said case and the present case.

After consolidating respondents appeal from the Labor Arbiters The petition fails.
The decision of the Arbiter 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 Arbiters
decision to the NLRC to solely question the propriety of the order
for reinstatement, and it succeeded.
Roquero, as well as Article 223[18] 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.
The Arbiter found petitioners dismissal to be valid. Such finding
had, as stated earlier, become final, petitioners not having
appealed it. Following Article 279 which provides:
xxxx
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 (Emphasis,
underscoring and italics supplied),
petitioners are not entitled to full backwages as their dismissal was
not found to be illegal. Agabon v. NLRC[19] so states payment of
backwages and other benefits is justified only if the employee was
unjustly dismissed.
WHEREFORE, the petition is DENIED.
No costs.
SO ORDERED.