Buenviaje vs CA GR No. 147806 Nov.
12, 2002
Followed Bustamante doctrine
Facts:
Petitioners were former employees of Cottonway Marketing Corp. (Cottonway), hired as
promo girls for their garment products. As company was suffering business losses, their
services were terminated, hence, they filed with the National Labor Relations
Commission (NLRC) a complaint for illegal dismissal, underpayment of salary, and non-
payment of premium pay for rest day, service incentive leave pay and thirteenth month
pay against Cottonway Marketing Corp. and Network Fashion Inc./JCT International
Trading.
LA found petitioners' retrenchment valid and ordering Cottonway to pay petitioners'
separation pay and their proportionate thirteenth month pay. NLRC reversed, ordered
the reinstatement of petitioners without loss of seniority rights and other privileges. It
also ordered Cottonway to pay petitioners their proportionate thirteenth month pay and
their full backwages inclusive of allowances and other benefits, or their monetary
equivalent computed from the time their salaries were withheld from them up to the
date of their actual reinstatement.
Cottonway manifested with NLRC that they have complied with the order of
reinstatement by sending notices dated June 5, 1996 requiring the petitioners to return
to work, but to no avail; and consequently, they sent letters to petitioners dated August
1, 1996 informing them that they have lost their employment for failure to comply with
the return to work order.
Petitioners filed with the NLRC a motion for execution of its Decision on the ground that
it had become final and executory.Cottonway on the other hand, kept manifesting
about failure of petitioners to comply to RTWO and they had found employments
elsewhere.
Nonetheless, on April 8, 1998, LA issued an Order declaring that the award of
backwages should be limited from the time of their illegal dismissal up to the time they
received the notice of termination sent by the company upon their refusal to report for
work despite the order of reinstatement. NLRC set this order aside, ruling that its
Decision dated March 26, 1996 has become final and executory and it is the ministerial
duty of the Labor Arbiter to issue the corresponding writ of execution to effect full and
unqualified implementation of said decision.
Cottonway, went to CA for a petition for certiorari which granted it ruling
that petitioners' reinstatement was no longer possible as they deliberately refused to
return to work despite the notice given by Cottonway. The Court of Appeals thus held
that the amount of backwages due them should be computed only up to the time they
received their notice of termination. MR denied, hence, this present petition.
Issue:
Whether backwages should be limited from the time of illegal dismissal up to
reinstatement or from illegal dismissal to receipt of termination notice?
Ruling:
The issue of the legality of the termination of petitioners’ services has been settled in
the NLRC decision dated March 26, 1996. Thus, Cottonway was ordered to reinstate
petitioners to their former position without loss of seniority rights and other privileges
and to pay them full backwages. These are the reliefs afforded to employees whose
employment is unlawfully severed. Reinstatement restores the employee to the position
from which he was removed, i.e., to his status quo ante dismissal, while the grant of
backwages allows the same employee to recover from the employer that which he lost
by way of wages because of his dismissal.
Under R.A. 6715, employees who are illegally dismissed are entitled to full backwages,
inclusive of allowances and other benefits or their monetary equivalent, computed from
the time their actual compensation was withheld from them up to the time of their
actual reinstatement. If reinstatement is no longer possible, the backwages shall
be computed from the time of their illegal termination up to the finality of the
decision.
"The Court deems it appropriate, however, to reconsider such earlier ruling on the
computation of backwages as enunciated in said Pines City Educational Center case, by
now holding that conformably with the evident legislative intent as expressed in Rep.
Act No. 6715, above-quoted, backwages to be awarded to an illegally dismissed
employee, should not, as a general rule, be diminished or reduced by the earnings
derived by him elsewhere during the period of his illegal dismissal. The underlying
reason for this ruling is that the employee, while litigating the legality (illegality) of his
dismissal, must still earn a living to support himself and family, while full backwages
have to be paid by the employer as part of the price or penalty he has to pay for
illegally dismissing his employee. The clear legislative intent of the amendment in Rep.
Act No. 6715 is to give more benefits to workers than was previously given them under
the Mercury Drug rule or the "deduction of earnings elsewhere" rule. Thus, a closer
adherence to the legislative policy behind Rep. Act No. 6715 points to "full backwages"
as meaning exactly that, i.e., without deducting from backwages the earnings derived
elsewhere by the concerned employee during the period of his illegal dismissal. In other
words, the provision calling for "full backwages" to illegally dismissed employees is
clear, plain and free from ambiguity and, therefore, must be applied without attempted
or strained interpretation.
Petitioners' alleged failure to return to work cannot be made the basis for their
termination. Such failure does not amount to abandonment which would justify the
severance of their employment. To warrant a valid dismissal on the ground of
abandonment, the employer must prove the concurrence of two elements: (1) the
failure to report for work or absence without valid or justifiable reason, and (2) a clear
intention to sever the employer-employee relationship.
Cottonway, before finally deciding to dispense with their services, did not give the
petitioners the opportunity to explain why they were not able to report to work. The
records also do not bear any proof that all the petitioners received a copy of the letters.
The law mandates the employer to either admit the dismissed employee back
to work under the same terms and conditions prevailing prior to his dismissal
or to reinstate him in the payroll to abate further loss of income on the part of
the employee during the pendency of the appeal. But we cannot stretch the
language of the law as to give the employer the right to remove an employee who fails
to immediately comply with the reinstatement order, especially when there is
reasonable explanation for the failure. If Cottonway were really sincere in its offer
to immediately reinstate petitioners to their former positions, it should have
given them reasonable time to wind up their current preoccupation or at least
to explain why they could not return to work at Cottonway at once. Cottonway
did not do either. Instead, it gave them only five days to report to their posts
and when the petitioners failed to do so, it lost no time in serving them their
individual notices of termination. We are, therefore, not impressed with the
claim of respondent company that petitioners have been validly dismissed on
August 1, 1996 and hence their backwages should only be computed up to that
time. We hold that petitioners are entitled to receive full backwages computed
from the time their compensation was actually withheld until their actual
reinstatement, or if reinstatement is no longer possible, until the finality of the
decision, in accordance with the Decision of the NLRC dated March 26, 1996
which has attained finality
