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Maranaw Hotel v. NLRC

The NLRC ordered the payroll reinstatement of an employee, Gina Castro, despite reversing the Labor Arbiter's decision finding illegal dismissal and instead finding she failed to meet employment standards. The Supreme Court ruled the NLRC committed grave abuse of discretion, as section 223 of the Labor Code only requires reinstatement pending appeal if the Labor Arbiter found illegal dismissal. Since the NLRC found no illegal dismissal, payroll reinstatement was not required. The petition of the employer, Maranaw Hotel Resort Corporation, was granted.

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2K views1 page

Maranaw Hotel v. NLRC

The NLRC ordered the payroll reinstatement of an employee, Gina Castro, despite reversing the Labor Arbiter's decision finding illegal dismissal and instead finding she failed to meet employment standards. The Supreme Court ruled the NLRC committed grave abuse of discretion, as section 223 of the Labor Code only requires reinstatement pending appeal if the Labor Arbiter found illegal dismissal. Since the NLRC found no illegal dismissal, payroll reinstatement was not required. The petition of the employer, Maranaw Hotel Resort Corporation, was granted.

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Aphr
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© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
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USA College of Law

Case Name 41. Maranaw Hotel Resort Corporation (Century Park Sheraton Manila) v. NLRC and Gina G. Castro
Topic Police Power
Case No. | Date G.R. No. 110027 | November 16, 1994
Ponente DAVIDE, JR., J.
As an exercise of the police power of the state, Section 223 of the Labor Code, which requires the
Doctrine decision of the Labor Arbiter ordering reinstatement of an employee pending appeal, has been
allowed even when the employer is willing to post a bond.

RELEVANT FACTS
 Gina G. Castro was dismissed from her work as a guest relations officer of the Century Park Sheraton Hotel
owned by the petitioner on the ground of failure to meet the standards set forth in her probationary
employment contract.
 She filed with the Arbitration Branch of the National Capital Region of the NLRC a complaint for illegal
dismissal with reinstatement, back wages, and damages against the hotel and its former general manager.
 The Labor Arbiter rendered a decision in favor of Castro containing erroneous computations for the
monetary award to her.
 Castro then filed a motion for execution pending appeal of the Labor Arbiter’s decision, which was not
acted upon.
 Petitioner, in turn, filed a surety bond to answer for the monetary award based on the erroneous
computation by the Labor Arbiter.
 The NLRC (Second Division), in a resolution, reversed the decision of the Labor Arbiter and dismissed the
complaint for lack of merit. It held that there was no illegal dismissal but rather a failure of the private
respondent to comply with the petitioner's standards for permanent employment.
 The NLRC, however, ordered the payroll reinstatement of Castro despite its resolution reversing the decision
of the Labor Arbiter and declaring that there was no illegal dismissal.
 Hence, this special civil action of certiorari raising the issue below.

ISSUE: W/N the NLRC acted with grave abuse of discretion in ordering the payroll reinstatement of Castro despite its
resolution reversing the decision of the Labor Arbiter and declaring that there was no illegal dismissal.
RULING:
YES. The NLRC acted with grave abuse of discretion.

The resolution of the issue is found in the third paragraph of Article 223 of the Labor Code which reads:
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 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 Aris (Phil.) Inc. v. NLRC, the Supreme Court sustained the constitutionality of reinstatement pending appeal of an
employee even when the employer is willing to post a bond as an exercise of the police power of the state and
further ruled that since appeal is a privilege of statutory origin, the law may validly prescribe limitations or
qualifications thereto or provide relief to the prevailing party in the event an appeal is interposed by the losing
party.

The petition should thus be granted.

RULING
Petition GRANTED.

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