EDMUNDO
Y. TORRES, JR. and G.R. No.
172584
MANUEL C. CASTELLANO,
Petitioners, Present:
QUISUMBING,
J.,
Chairperson,
-
versus - CARPIO
MORALES,
TINGA,
VELASCO,
JR., and
BRION, JJ.
NATIONAL
LABOR RELATIONS
COMMISSION,
FOURTH DIVISION,
and SAN MIGUEL
CORPORATION, Promulgated:
Respondents.
x----------------------------------------------------------------------------x
Tinga,
J.:
Petitioners assail the
Decision[1] of
the Court of Appeals in CA-G.R. SP No. 77489 dated July 5, 2005, which affirmed
the Decision[2] and
Resolution[3] of
the National Labor Relations Commission (NLRC) in NLRC Case No. V-000593-2000,
and its Resolution[4] dated April
11, 2006, denying reconsideration.
The undisputed facts are narrated by the Court of Appeals as follows:
The
petitioners Edmundo Y. Torres and Manuel C. Castellano are former Regional
Sales Manager and District Sales Supervisor, respectively, of private
respondent San Miguel Corporation (SMC), Bacolod Beer Region, Sum-ag, Bacolod
City.
The petitioners were
among the many employees of the private respondent who retired from employment
effective on April 15, 1984 pursuant to private respondent SMC’s Retirement
Plan. Believing that they were
constructively forced to retire from employment and that their separation from
employment was illegal, on March 14, 1984, the petitioners, along with other
separated employees, filed a complaint for illegal dismissal against SMC with
the National Labor Relations Commission (NLRC), Regional Arbitration Branch No.
VI, Bacolod City. The case was docketed
as RAB-VI Case No. 0372-84. It was
assigned to then Labor Arbiter Oscar S. Uy for the proper disposition thereof. Proceedings were conducted by the said labor
arbiter.
After the petitioners
and private respondent SMC had presented their evidence and position papers,
the case was considered as submitted for decision.
On September 16, 1988,
Labor Arbiter Oscar S. Uy rendered a Decision in RAB-VI Case No. 0372-84
dismissing all the claims of the petitioners against the respondent SMC,
ratiocinating as follows:
x x x
WHEREFORE,
premises considered, judgment is hereby rendered DISMISSING all the claims of
the complainants’ against the respondent for lack of merit.
SO
ORDERED.
On October 21, 1988,
petitioners (complainants in RAB-VI-Case No. 0372-84) appealed from the
aforesaid Decision to public respondent NLRC, Fourth Division in Cebu City
which, on August 21, 1992, handed down a Decision reversing in part that of the
Labor Arbiter, disposing as follows:
WHEREFORE, in view
of the foregoing, the appealed Decision is hereby SET ASIDE, and another one
entered declaring the complainants Gabriel Z. Abad, George A. Teddy, Jr. and
Manuel J. Chua to have been validly retired.
Respondent San Miguel Corporation is hereby ordered to immediately
reinstate complainants Manuel C. Castellano and Edmundo Y. Torres, Jr. to their
former or equivalent positions without loss of seniority rights and to pay
complainants Manuel C. Castellano the amount of P73,905.84 and Edmundo
Y. Torres, Jr. the amount P108,915.00 representing their back salaries
for three (3) years after deducting the sum of P47,954.16 and P75,255.00
they received as retirement pay.
SO ORDERED.
Not satisfied with the
above-quoted Decision of the NLRC, private respondent SMC filed a Motion for
Reconsideration, but the same was denied by the NLRC in its Resolution dated
October 19, 1992. Consequently, it
appealed from the same through a petition for certiorari to the Supreme Court
which, on July 23, 1998, rendered a Decision affirming in toto that of
the NLRC. The dispositive portion of the
Supreme Court Decision reads as follows:
WHEREFORE,
for lack of merit, the petition is hereby DISMISSED and the assailed Decision
of the NLRC dated August 21, 1992 is affirmed in its entirety. No pronouncement as to cost.
SO
ORDERED.
Subsequently,
the aforesaid Decision of the Supreme Court became final and executory on March
22, 1999, as evidenced by the Entry of Judgment issued by it. So, on August 11, 1999, the petitioners filed
a Motion for Execution of the Decision in their favor at the Regional
Arbitration Branch VI, Bacolod City.
As a consequence,
private respondent SMC partially complied with the Decision by paying the
monetary awards in favor of the petitioners Torres and Castellano in the
amounts of P108,915.00 and P73,905.84, respectively, representing
their back salaries for three (3) years after deducting the sums of P75,255.00
and P47,954.16 that they received, respectively, from SMC as Retirement
Pay.
Then, the petitioners,
in an effort to cause the amendment of the 1992 NLRC Decision, filed a Motion
for Computation and Satisfaction of Back Salaries, praying for the issuance of
an Order directing the private respondent SMC to pay them the sums of P9,218,205.00
and P5,268,455.50 respectively, representing purportedly their back
salaries and other benefits from September 9, 1992 up to November 1999 with the
corresponding prayer for the issuance of
a Writ of Execution for the satisfaction thereof, invoking the Supreme Court ruling in Pioner Texturizing Corporation v. NLRC,
G.R. No. 118651, October 16, 1997, granting full back wages to illegally
dismissed employees.
On November 23, 1999,
the private respondent SMC filed its Opposition to petitioners’ Motion for
Computation and Satisfaction of Back Salaries by arguing, among others, that
the petitioners’ claim has no legal basis considering that, in the final and
executory Decision of public respondent NLRC, dated August 21, 1992, which was
already affirmed by the Supreme Court, petitioner Castellano was merely awarded
the amount of P73,905.84, while petitioner Torres, Jr. was awarded the
mount of P108,915.00, representing their back salaries for three (3)
years after deducting the sums of P47,954.16 and P75,255.00
respectively, that they received as retirement pay from SMC.
Surprisingly, on
December 27, 1999, the Executive Labor Arbiter Oscar S. Uy, thinking that he
had the corresponding authority, issued an Order granting the petitioners’
Motion for Computation of Back Salaries, the dispositive portion of which
reads:
PREMISES
CONSIDERED, respondent San Miguel Corporation thru its authorized agent/s
and/or personnel is hereby ordered to pay complainants EDMUNDO Y. TORRES, JR.
and MANUEL CASTELLANO the sum of P9,218,205.00 and P5,268,455.00
respectively within ten (10) days from receipt of this Order.
SO
ORDERED.
Aggrieved,
private respondent SMC appealed from the aforesaid Order of the Executive Labor
Arbiter to the public respondent NLRC, Fourth Division in Cebu City.
But
again, on February 2, 2000, the petitioners filed another Motion to direct the
private respondent SMC to comply strictly with the 1992 NLRC Decision relative
to their reinstatement with the Executive Labor Arbiter granted in his Order
dated March 15, 2000. The dispositive
portion of the said Order reads as follows:
PREMISES
CONSIDERED, the respondent corporation is hereby ordered to pay Edmundo Y.
Torres, Jr. and Manuel C. Castellano effective January 2000 their monthly basic
salary of P60,000.00 and P45,000.00 respectively, within ten (10)
days after receipt hereof.
SO
ORDERED.
Private
respondent SMC again timely appealed from the aforecited Order to the public
respondent NLRC.
On
May 18, 2000, the petitioners filed with the Executive Labor Arbiter Oscar S.
Uy a Motion for Execution to enforce or satisfy the latter’s Order dated March
15, 2000 which the latter granted in his Order dated June 16, 2000, pursuant to
which a Writ of Execution was issued at even date.
On
September 12, 2001, public respondent NLRC promulgated a Decision in two
appealed cases filed with it by the private respondent SMC relative to the 1999
and March 15, 2000. The dispositive
portion of the said Decision reads as follows:
WHEREFORE,
the questioned Orders are SET ASIDE and a new one entered declaring that
complainants are NOT entitled to backwages.
SO ORDERED.
Aggrieved
thereby, on October 29, 2001, the petitioners filed a Motion for
Reconsideration of the said Decision. On
March 20, 2003, public respondent NLRC promulgated a Resolution denying the
petitioners’ Motion for Reconsideration.
Not
satisfied with the foregoing Decision and Resolution promulgated by the
respondent NLRC, the petitioners are assailing them for having been purportedly
promulgated by the said respondent with grave abuse of discretion.[5]
The Court of Appeals
upheld the decision and resolution of the NLRC.
According to the appellate court, although the NLRC ordered the
immediate reinstatement of petitioners in its August 21, 1992 decision, the
order was not self-executory because the rule decreeing an order for
reinstatement immediately executory was only enunciated by the Court in its
decision in Pioneer Texturizing Corp. v.
NLRC[6] dated October 16, 1997. Petitioners should have moved for the
issuance of a writ of execution of the NLRC decision. However, petitioners only
moved for the execution of the NLRC decision on August 11, 1999.
The appellate court further ruled that San Miguel
Corporation’s (SMC’s) retirement plan, under which it has the prerogative to
retire its employees after 20 years of service or upon reaching the age of 60,
binds petitioners. Accordingly, petitioners may no longer be reinstated having
already reached retirement age.
The appellate court denied reconsideration.
Unsurprisingly, petitioners filed the instant Petition for
Review on Certiorari[7]
dated June 1, 2006, arguing that the Pioneer
case has a curative effect such that upon SMC’s receipt of the August 21,
1992 NLRC decision on September 9, 1992, it should have informed petitioners
whether it would re-admit them to work under the same terms and conditions
prevailing prior to their dismissal or reinstate them in its payroll. SMC’s failure to so inform them allegedly
entitled them to back salaries from September 9, 1992 until they are
effectively reinstated to their previous employment without loss of seniority
rights. Petitioners thus came up with
the amounts of P9,218,205.00 and P5,268,455.00 representing their
back salaries from September 9, 1992 up to November 8, 1999 when they were
reinstated in SMC’s payroll.
Petitioners further aver that they have not been actually or
effectively retired by SMC and are still entitled to reinstatement pursuant to
the August 21, 1992 NLRC decision.
SMC, in its Comment[8]
dated September 1, 2006, argues that petitioners are effectually seeking the
amendment of the Court’s final Decision in San
Miguel Corporation v. NLRC[9] which effectively limited their
backwages to three (3) years pursuant to the then prevailing law and
jurisprudence. It insists that Republic
Act No. 6715 (R.A. No. 6715), which declared the reinstatement of illegally
dismissed employees to be immediately executory, has no retroactive effect and
cannot benefit petitioners who were dismissed on March 14, 1984, three years
before R.A. No. 6715 took effect on March 21, 1989.
The company also asserts that its retirement plan was
acknowledged by this Court as a valid management prerogative. Petitioners
allegedly misled the Court by their assertion that the retirement plan does not
apply to them as supervisory and sales employees. What the Court clarified as applicable only
to rank and file employees was the reduction of the length of service from 20
years to 15 years.
Petitioners’ Reply[10]
dated September 8, 2006 is a reiteration of their arguments.
Art. 223 of the Labor Code, as amended by R.A. No. 6715,
provides:
Art.
223. Appeal.—Decisions, awards, or
orders of the Labor Arbiter are final and executory unless appealed to the
Commission by any or both parties within ten (10) calendar days from receipt of
such decisions, awards, or orders. Such appeal may be entertained only on any
of the following grounds:
..,
In
any event, the decision of the Labor Arbiter reinstating a dismissed or
separated employee, insofar as the reinstatement aspect is concerned, shall
immediately be executory, even pending appeal. The employee shall either be
admitted back to work under the same terms and conditions prevailing prior to
his dismissal or separation or, at the option of the employer, merely
reinstated in the payroll. The posting of a bond by the employer shall not stay
the execution for reinstatement provided herein.
…
In its assailed decision, the Court of Appeals ruled that at
the time petitioners were dismissed in 1984, R.A. No. 6715 had not yet been
enacted. Further, the Court’s ruling in Maranaw
Hotel Resort Corp. v. NLRC,[11] holding that in the absence of an order
for the issuance of a writ of execution on the reinstatement aspect, the
employer is under no legal obligation to admit its illegally dismissed employee
back to work, was declared by the appellate court as still controlling.
The review of jurisprudence outlined in the Pioneer case easily bears out the
appellate court’s decision. In Inciong v. NLRC,[12] the Court declared that in the absence
of a provision giving it retroactive effect, the amendment introduced in the
aforequoted provision cannot be applied to the decision of the labor arbiter
rendered three (3) months before R.A. No. 6715 had become a law. It was under
this jurisprudential setting that the August 21, 1992 decision of the NLRC
ordering the reinstatement of petitioners was promulgated.
In the line of cases[13]
following Inciong, the Court
consistently held that immediate reinstatement is mandated and is not stayed by
the fact that the employer has appealed or posted a cash or surety bond pending
appeal. However, in the Maranaw case, the Court declared that although the reinstatement
aspect of the (labor arbiter’s)
decision is immediately executory, it does not follow that it is
self-executory. There must be a writ of execution which may be issued motu proprio or on motion of an
interested party.
The Court made a complete turn-around in the Pioneer case and declared that
henceforth, an award or order of reinstatement shall be considered
self-executory, such that, after receipt of the decision or resolution ordering
the employee’s reinstatement, the employer 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.
It is clear from the foregoing that at the time the August
21, 1992 NLRC decision was promulgated, the rule commonly adhered to was for a
writ of execution to be issued, either motu
proprio or on motion of an interested party, before the employer may be
compelled to admit the employee back to work or to reinstate him in the
payroll, on pain of being liable for the employee’s salaries. However, at the time the Court’s Decision in San Miguel Corporation v. NLRC was
promulgated on July 23, 1998, the Pioneer
case was already the prevailing rule on the matter and should have been
read into the case. Thus, upon its
receipt of our July 23, 1998 Decision affirming the NLRC decision, SMC should
have immediately opted either to re-admit petitioners or merely reinstate them
in the payroll.
Be that as it may, the retirement age of 60 years already
attained by petitioners as early as 1989 for Edmundo Torres, Jr. and 1990 for
Manuel Castellano had set in motion the provisions of SMC’s Retirement Plan
which, we acknowledge, is a valid management prerogative. Ultimately, therefore, the Court of Appeals
was correct in ruling that the reinstatement of petitioners is no longer
feasible. SMC should accordingly take
formal steps, in accordance with its Retirement Plan, to effect petitioners’
retirement.
Even so, petitioners should not be compelled to return the
salaries and benefits already received by them on account of the order for
reinstatement adjudged by the NLRC and affirmed by the Court. In Air Philippines Corporation v. Zamora,[14] we
held that if an employee was reinstated during the appeal period but such
reinstatement was reversed with finality, the employee is not required to
reimburse whatever salary he received from the employer. Justice and equity require that we apply the
same doctrine to this case.
WHEREFORE, the petition is DENIED. The Decision of the Court
of Appeals in CA-G.R. SP No. 77489 dated July 5, 2005 and its Resolution dated
April 11, 2006 are AFFIRMED with the MODIFICATION that petitioners are not
required to refund the amounts received by them from respondent San Miguel
Corporation on account of the reinstatement order of the National Labor
Relations Commission as affirmed by the Court in its Decision dated July 23,
1998. No pronouncement as to costs.
SO ORDERED.
DANTE O. TINGA Associate Justice
WE CONCUR:
LEONARDO A. QUISUMBING
Associate Justice
Chairperson
CONCHITA CARPIO MORALES PRESBITERO J.
VELASCO, JR.
Associate Justice
Associate Justice
ARTURO D. BRION
Associate Justice
ATTESTATION
I attest that the conclusions in the above
Decision had been reached in consultation before the case was assigned to the
writer of the opinion of the Court’s Division.
LEONARDO A. QUISUMBING
Associate Justice
Chairperson, Second Division
CERTIFICATION
Pursuant to Section 13, Article VIII of the Constitution,
and the Division Chairperson’s Attestation, it is hereby certified that the
conclusions in the above Decision had been reached in consultation before the
case was assigned to the writer of the opinion of the Court’s Division.
REYNATO S. PUNO
Chief Justice
[1]Rollo, pp. 41-52; Penned by Associate Justice Isaias P. Dicdican and concurred in by Associate Justices Sesinando E. Villon and Enrico A. Lanzanas.
[13]Callanta v. NLRC, G.R. No. 105083, August 20, 1993, 225 SCRA 526; Zamboanga City Water District v. Buat, G.R. No. 104389, May 27, 1994, 232 SCRA 587; Medina v. Consolidated Broadcasting System-DZWX, G.R. Nos. 99054-56, May 28, 1993, 222 SCRA 707 all cited in Pioneer Texturing Corp. v. NLRC, G.R. No. 118651, October 16, 1997, 280 SCRA 806.