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Also, the matters contained in the following were written in accordance with the law, rules, and jurisprudence prevailing at the time of writing and posting, and do not include any future developments on the subject matter under discussion.
AT A GLANCE:
Article 223, paragraph 3, of the Labor Code mandates the employer to promptly reinstate the dismissed employee, either by actual reinstatement under the conditions prevailing before the dismissal, or through his or her inclusion in the payroll.
In 2005, petitioner Jose Leni Z. Solidum filed a complaint for illegal dismissal, illegal suspension, non-payment of salaries, damages, and attorney’s fees against respondent Smart Communications, Inc., its President and Chief Executive Officer, Napoleon Nazareno, and its former Marketing Head, Ricardo Isla.
On July 3, 2006, the Labor Arbiter rendered a decision in favor of Solidum and found that he was illegally dismissed from employment by Smart.
Smart appealed to the National Labor Relations Commission (NLRC). Pending resolution of Smart’s appeal, the Labor Arbiter issued a writ of execution commanding the sheriff to collect from Smart the accrued reinstatement wages and benefits of Solidum from July 21, 2006 to October 20, 2006. Thereafter, the NLRC denied Smart’s appeal for being filed out of time.
During the period from August 15, 2007 to January 22, 2009, the Labor Arbiter issued seven (7) Alias Writs of Execution on the collection of the monetary awards and reinstatement aspect of the Labor Arbiter’s July 3, 2006 Decision.
Despite the issuance of the alias writs, they were not carried out by Smart. Instead it filed several motions seeking the quashal of the alias writs. Meanwhile, in a resolution dated January 26, 2009, the NLRC granted Smart’s motion for reconsideration and dismissed Solidum’s complaint in the Illegal Dismissal Case.
Solidum filed a motion for reconsideration of the January 26, 2009 Resolution of the NLRC. Meanwhile, Smart filed an Urgent Motion for Issuance of a Writ of Preliminary Injunction with application for Temporary Restraining Order.
Pending resolution of Solidum’s motion for reconsideration in the Illegal Dismissal Case, Solidum filed before the Labor Arbiter an Ex-parte Motion for Issuance of Alias Writ of Execution on the Reinstatement Aspect of the Labor Arbiter’s July 3, 2006 Decision.
On May 29, 2009, the NLRC rendered a decision in the Illegal Dismissal Case, denying both the motion for reconsideration filed by Solidum and the injunction filed by Smart for lack of merit. On August 10, 2009, the NLRC’s decision in the Illegal Dismissal Case, dated May 29, 2009, became final and executory.
On July 29, 2009, the Labor Arbiter issued an Order in the Alias Writ Case denying Solidum’s Ex-parte Motion for Issuance of Alias Writ of Execution on the Reinstatement Aspect of the Decision.
The NLRC partly granted Solidum’s appeal in the Alias Writ Case, remanding the case to the Labor Arbiter for the issuance of an alias writ of execution for the collection of accrued reinstatement wages and other benefits for the period covering July 13, 2006 to May 29, 2009.
On July 30, 2010, the NLRC granted Solidum’s Motion for Partial Reconsideration, denied Smart’s Motion for Reconsideration, and ordered Smart to pay the accrued reinstatement salaries and benefits of Solidum from July 13, 2006 to August 10, 2009.
Smart filed a Petition for Certiorari before the Court of Appeals (CA). Meanwhile, Smart filed with the Labor Arbiter a Motion to Suspend Proceedings and a Motion for Recomputation of Claimed Monetary Awards, which was denied for lack of merit.
Thereafter, the Labor Arbiter issued the Eighth Alias Writ of Execution on October 22, 2010, and Ninth Alias Writ issued on May 18, 2011, by which Solidum received from Smart the amount of PhP2,881,335.86, representing his accrued salaries, allowances, benefits, incentives, and bonuses for the period from January 21, 2009 to July 20, 2009. Subsequently, the Tenth Alias Writ was issued on May 8, 2012 for the payment to Solidum of additional unpaid reinstatement salaries and other benefits for the period from July 13, 2006 to January 26, 2009 in the total amount of PhP15,889,871.04.
On January 25, 2011, the CA granted Smart’s petition, nullifying and setting aside the NLRC’s decision and reinstating the Labor Arbiter’s order dated July 29, 2009.
In an amended decision, the CA partly granted Solidum’s motion for reconsideration. The CA
upheld its finding that the NLRC gravely abused its discretion in taking cognizance of Solidum’s appeal of an interlocutory order. Nevertheless, it found that the NLRC’s order dated May 29, 2009, became final and executory on August 10, 2009.
Smart filed a Motion for Partial Reconsideration with Motion to Order Return, praying that Solidum be ordered to return the total amount of PhP18,691,169.80 that he received from the Eighth, Ninth, and Tenth Alias Writs of Execution.
The CA affirmed its amended decision with modification, ordering Solidum to return the additional wages and benefits he received by virtue of the Tenth Alias Writ in the amount of PhP15,889,871.04. Solidum filed a Motion for Leave to Admit Motion for Partial Reconsideration, which was denied by the CA. Hence, this petition for partial review on certiorari.
The issue in this case is whether or not the CA erred in ordering Solidum to return to Smart the amount he received through the Tenth Alias Writ covering his accrued wages and benefits for the period from July 13, 2006 to January 26, 2009.
The Supreme Court Decides
The Supreme Court granted the petition for partial review on certiorari.
The immediately executory nature of the Labor Arbiter’s decision mandates Smart to reinstate Solidum until reversal by the NLRC. Smart’s non-compliance of the Labor Arbiter’s
order of reinstatement resulted to Solidum’s unpaid wages and benefits under the Tenth Alias Writ.
From July 2006 to January 2009, nearly three (3) years of wages and benefits went unpaid. Smart’s liability grew because the earlier Alias Writs (First to Seventh) were never fulfilled, necessitating a complete recalculation of Solidum’s rightful compensation during that period.
The CA appears to have misapplied the Two-Fold Test, leading to the erroneous order for Solidum to return PhP15,889,871.04 to Smart. The CA incorrectly attributed Solidum’s alleged delay in filing his claim for additional benefits as a basis for denying him his accrued wages and benefits.
Article 223, paragraph 3, of the Labor Code mandates the employer to promptly reinstate the
dismissed employee, either by actual reinstatement under the conditions prevailing before the dismissal, or through his or her inclusion in the payroll. The delay in implementing Solidum’s reinstatement pending appeal was due to Smart’s unjustified acts. Thus, Solidum is entitled to the PhP15,889,871.04 claimed under the Tenth Alias Writ, representing his accrued earnings from before August 10, 2009, covering the period from July 13, 2006 to January 26, 2009.
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Alburo Alburo and Associates Law Offices specializes in business law and labor law consulting. For inquiries regarding legal services, you may reach us at info@alburolaw.com, or dial us at (02)7745-4391/ 09175772207/ 09778050020.
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