CHONG GUAN TRADING, PETITIONER, VS. NATIONAL LABOR RELATIONS COMMISSION AND JOSE M. CHUA, RESPONDENTS.

Assailed in this petition is the decision of the National Labor Relations
Commission (NLRC) in NLRC Case No. 11-4406-83, entitled “Jose M. Chua v. Chong Guan Trading,” whereby the NLRC held that
private respondent Jose M. Chua was illegally dismissed by petitioner Chong Guan Trading. 
The Court after a careful examination of the pleadings filed in this
case, i.e., the Petition and its Annexes, the Comment of public respondent, the
Reply and Supplemental Reply of petitioner, the Manifestation/Opposition of
private respondent, and the Rejoinder of public respondent, considered the
Comment as answer, the issues joined, and the case submitted for decision.

Jose M. Chua was employed as sales manager of Chong
Guan Trading, a dealer of paper and paper products owned by Mariano,  Pepito
and Efren Lim. 
Private respondent started working with the petitioner way back in 1960
but it was only in 1972 that his name was registered by petitioner with the
Social Security System [Decision of SSC in SSS Case No. 8728, p. 1; Rollo, p. 49.]

In November 1983, private respondent filed a complaint with the
Office of the Labor Arbiter of the National Capital Region charging petitioner
with illegal dismissal and non-payment of overtime pay and other benefits
provided for by law. In his complaint, private respondent alleged that he was
fired by Mariano Lim because of the incident that occurred on October 28, 1983.

It appears from the record that on the morning of October 28, 1983, a customer, who
borrowed the store’s telephone directory, accidentally dropped it on the top
glass of the store’s showcase causing it to break.  When Pepito Lim saw
the already taped broken top-glass he asked for an explanation from private
respondent.  In order to cover up for the
customer, private respondent admitted that he himself accidentally broke it.  Pepito then got
angry and hurled “unprintable words and invectives” at private
respondent [Decision of NLRC, p. 2; Rollo, p. 14.]
What transpired thereafter was disputed by both parties.  Private respondent claimed that he was
dismissed by Mariano Lim when the fatter ordered him to leave petitioner’s
premises.  Petitioner, on the other hand,
denied having dismissed private respondent and claimed that it was private
respondent who went home after the incident and failed to report for work for
many days thereafter.  Petitioner alleged
that, far from being dismissed, it was private respondent himself who abandoned
his job.

The parties filed their respective position papers and agreed to
submit the case for resolution on the basis of the pleadings.

On April 18, 1984,
the Labor Arbiter rendered a decision finding that there was no illegal
dismissal since private respondent was never dismissed
by petitioner.  The Labor Arbiter held
that the altercation that occurred between private respondent and the Lim
brothers because of the broken top-glass cannot be construed as the dismissal
of the private respondent because it was only a minor incident.  No pronouncement on the issue of the alleged
abandonment by private respondent was made but the Labor Arbiter ordered the
reinstatement of private respondent but without backwages.  The dispositive
portion of the decision reads:

WHEREFORE, respondents are hereby ordered to reinstate complainant
to his former position without backwages, to pay him
his proportionate 13th-month pay for the year 1983 and the money equivalent of
fifteen (15) days service incentive leave pay. 
All his other claims including the claim for damages are hereby,
DISMISSED.

SO ORDERED.

[Decision of Labor Arbiter, p. 7; Rollo,
p. 31]

Private respondent elevated the decision of the Labor Arbiter to
the NLRC.  In a resolution promulgated on
June 30, 1987, the NLRC
dismissed the appeal for being filed out of time.

Upon motion of private respondent, the NLRC reconsidered its
Resolution and gave due course to the appeal. 
On December 29, 1987
respondent Commission decided in favor of private respondent and held that:

*           *           *

. . . we are by and large convinced that
the appellant was indeed dismissed without the attendant formalities required
by law.          On account of which, he
should therefore, be reinstated to his former position with three (3) years backwages without qualification or deduction.

Should reinstatement, however, be not feasible due to circumstances
or developments not attributable to the appellees,
the appellant should, in addition to the three years backwages,
be paid a separation pay equivalent to one half month pay for every year of
service, a fraction of at least six (6) months being considered as one whole
year.

The rest of the award for other benefits stays.

WHEREFORE, modified as above-indicated, the decision appealed from
is hereby, AFFIRMED.

SO ORDERED. [NLRC Decision, p. 18; Rollo, p. 18.]

From the NLRC decision, petitioner interposed the present
petition.

The Court will first address the procedural issue raised by the
petitioner.

Petitioner maintains that respondent NLRC has no jurisdiction to
entertain the appeal filed by private respondent, much less modify the decision
appealed from, the same having become final and executory
after the lapse of ten (10) days from respondent’s receipt thereof.

Article 223 of the Labor Code [Pres. Decree 442, as amended]
provides for a reglementary period of ten (10) days
within which to appeal a decision of the labor arbiter to the NLRC.  The ten-day period has been interpreted by
this Court in the case of Vir-jen and Marine
Services Inc., v. National Labor Relations
Commission [G.R. Nos. 58011-12, July 20, 1987, 115 SCRA 347] as ten (10)
“calendar” days and not ten (10) “working” days.

In the instant case, while the appeal was filed within ten (10)
working days from receipt of the decision, it was filed beyond the ten (10)
calendar days prescribed by law.  Private
respondent received a copy of the decision of Labor Arbiter Martinez on May 3, 1984 while the appeal was filed
only on May 15, 1984 or
twelve (12) days from notice of the decision [Resolution of NLRC, p. 1; Rollo, p. 32.]

It is true that the perfection of an appeal in the manner and
within the period prescribed by law is not only mandatory but jurisdictional,
and failure to perfect an appeal has the effect of rendering the judgment final
and executory [Narag v.
National Labor Relations Commission, G.R. No. 69628, October 28, 1987, 155 SCRA
199.]  However, as correctly pointed out
by the Solicitor General, the NLRC may disregard the procedural lapse where
there is an acceptable reason to excuse tardiness in the taking of an
appeal  [Comment of the Office of
Solicitor General, p. 6; Rollo, p. 46; See also
Firestone Tire and Rubber Company of the Philippines v. Lariosa,
G.R. No. 70479, February 27, 1987, 148 SCRA 187; MAI Philippines, Inc. v.
National Labor Relations Commission, G.R. No.73662, June 18, 1987, 151 SCRA
196.]

In this case, the appeal was filed out of time because the counsel
of private respondent relied on the footnote of the notice of the decision of
the Labor Arbiter which stated that “the aggrieved party may appeal . . .
within ten (10) working days, as per NLRC Resolution No. 1, series of
1977.” [Decision of NLRC, p. 1; Rollo, p. 13;
Underscoring supplied.] In the case of Firestone Tire and Rubber
Co. of the Phil v. Lariosa,
[supra], which has substantially the same set of facts as this case, the Court
accepted the party’s reliance on the erroneous notice in the labor arbiter’s
decision as a reasonable ground for excusing non-compliance with the ten (10) calendar day period for appeal. Explaining the reason for
this ruling, the Court said:

*           *           *

Mindful of the fact that Lariosa’s
counsel must have been misled by the implementing rules of the labor commission
and considering that the shortened period for an appeal is principally intended
more for the employee’s benefit, rather than that of the employer, We are
inclined to overlook this particular procedural lapse and to proceed with the
resolution of the instant case. [at p. 191.]

*           *           *

Thus, private respondent’s late filing of the appeal
notwithstanding, the Court finds that public respondent did not commit grave
abuse of discretion in giving due course to the appeal.

Having disposed of the procedural issue, the Court will now deal
with the main issue in this case, which is whether or not NLRC committed grave
abuse of discretion in ordering petitioner to pay private respondent three
years backwages and separation pay (if reinstatement
is no longer possible) for the alleged illegal dismissal of private respondent.

While petitioner concedes that private respondent of must be
reinstated since there was no intentional abandonment on the part of private
respondent, it challenges the order for the payment of backwages
and separation pay.  Petitioner contends
that there was no illegal dismissal to speak of since private respondent was
never dismissed in the first place, and that justice dictates that private
respondent must simply be reinstated [Reply pp. 1-2; Rollo,
pp. 51-52.]

Both the labor arbiter and the NLRC agree that the accidental,
breaking of the showcase’s top-glass was so minor an incident as to provoke an
employer to dismiss a managerial employee who has worked with him for more than
twenty (20) years [Decision of NLRC, p. 4; Rollo, p.
16.] However, in holding that private respondent was illegally dismissed by
petitioner, the NLRC held that:

We agree that the accidental breaking of the showcase’s top-glass
was a minor incident.  Ordinarily it
could not provoke an employer (who knew what its repercussions could be) to
dismiss an employee for that matter.  But
the appellees [petitioner Chong Guan Trading and its owners]
who, we perceive, were indeed bent on
ousting the appellant [private respondent Chua]
magnified it to such a serious proportion,
as shown by the unprintable words and
invectives that they hurled to the appellant,
to ostensibly justify their heretofore desire
to terminate him.

In short, they seized the incident
as the most opportune time to implement
their obvious decision to lay-off the
appellant. . . . (Decision of NLRC, p. 4; Rollo, p. 16; Underscoring supplied.)

The import of the above findings of the NLRC is that the breaking
of the top-glass was used by petitioner as an excuse to terminate respondent
Chua in accordance with its scheme or plan to oust him.

The Court cannot sustain the findings of respondent NLRC.

As found by the labor arbiter, no evidence was presented to
establish the existence of the so-called scheme to oust private respondent
[Decision of Labor Arbiter, p. 5; Rollo, p. 29.) It
was based only on private respondent’s unsupported claim that there was an
“orchestrated scheme or plan” to oust him and that this plan had been
carefully laid out for a long time. 
Private respondent’s claim is not borne out by the record which shows
that petitioner has been granting substantial cash advances to private
respondent.  In fact barely a month
before his alleged illegal dismissal, petitioner allowed private respondent to
make a cash advance of P4,718.00 (Decision of Labor
Arbiter, p. 5; Rollo, p. 29.] If indeed there was a
scheme to oust private respondent, petitioner should have denied him further
cash advances knowing that his services will soon be terminated and as a result
thereof, there may be no way to recover the cash advances.

Furthermore, the NLRC admitted in its decision that its finding that the petitioner was “indeed bent on
ousting” private respondent was based only on its “perception” and
not on any evidence on record (Decision of NLRC, p. 4; Rollo,
p. 16.] This Court however, cannot rely on NLRC’s
perception or speculations in the absence of any credible evidence to support
it [San Miguel Corporation v. National Labor Relations Commission, G.R. No.
50321, March 13, 1984, 128 SCRA 180.] For while it is well-established that the
findings of facts of the NLRC are entitled to great respect and are generally
binding on this Court [Antipolo Highway Lines, Inc.
v. Inciong, G.R. No. L-38532, June 27, 1975, 64 SCRA 441; Philippine Labor Alliance Council
(PLAC) v. Bureau of Labor Relations, G.R. No. L-41288,
January 31,
1977, 75 SCRA 162; Genconsu
Free Workers Union v. Inciong, G.R. No. L-48687,
July 2, 1979, 91 SCRA 311; Pan-Philippine Life Insurance Corporation v. NLRC,
G.R. No. 53721, June 29, 1982, 114 SCRA 866; Pepsi-Cola.  Labor Union-BFLU-TUPAS
Local Chapter No. 896 v. National Labor Relations. G.R. No. 58341, June
29, 1982, 114 SCRA 930; Mamerto v. Inciong, G.R. No. 53068, November 15, 1982, 118 SCRA 265;
San Miguel  Corporation v. National Labor
Relations Commission, G.R. No. 50321, March 13, 1984, 128 SCRA 180] it is
equally well-settled that the Court will not uphold erroneous conclusions of
the NLRC when the Court finds that the latter committed grave abuse of
discretion in reversing the decision of the labor arbiter or when the findings
of facts from which the conclusions were based were not supported by
substantial evidence [Insular Life Assurance Co., Ltd. Employees
Association-NATU v. Insular Life Assurance Co., Ltd., G.R. No. L-25291, March
10, 1977, 76 SCRA 50; Kapisanan ng
Manggagawa sa Camara Shoes v. Camara Shoes,
G.R. No. 50985, January 30, 1982, 111 SCRA 477.]

The question that must now be addressed by the Court is whether,
absent the alleged scheme or plan to oust private respondent, it can be
inferred from the events that transpired on the morning of October 28, 1983
that private respondent was illegally dismissed by petitioner.

Private respondent claims that Mariano Lim dismissed him when the
latter said: “Lumayas ka rito.”
This is disputed by the petitioner who claims that it was private respondent
who voluntarily left petitioner’s premises.

After a careful examination of the events that gave rise to the
present controversy as shown by the record, the Court is convinced that private
respondent was never dismissed by the petitioner.  Even if it were true that Mariano Lim ordered
private respondent to go and that at that time he intended to dismiss private
respondent, the record is bereft of evidence to show that he carried out this
intention.  Private respondent was not
even notified that he had been dismissed. 
Nor was he prevented from returning to his work after the October 28
incident.  The only thing that is
established from the record, and which is not disputed by the parties, is that
private respondent Chua did not return to his work after his heated argument
with the Lim brothers.

Moreover, petitioner has consistently manifested its willingness
to reinstate private respondent to his former position.  This negates any intention on petitioner’s
part to dismiss private respondent. 
Petitioner first expressed its willingness to reinstate private respondent
during the initial hearing of the case before the Labor Arbiter [Decision of
Labor Arbiter, p. 6; Rollo, p. 30.] In its position
paper the petitioner also stated that:

*           *           *

IN PASSING, we gladly reiterate . . . that the management is still
waiting and more than willing to accept him [private respondent] and return to
his former position, notwithstanding his long unauthorized absences and the
intentional abandonment from his job.

*           *           *

(“Annex B” to the Petition, p. 5; Rollo,
p. 24.]

This was again reiterated by the petitioner in its Reply to the
Comment of public respondent filed in connection with the instant petition
[Reply, pp. 1-2; Rollo, pp. 51-52.]

Therefore, considering the Court’s finding that private
respondent was never dismissed by the petitioner, the award of three years backwages was not proper. 
Backwages, in general, are granted on grounds
of equity for earnings which a worker or employee has lost due to his illegal
dismissal from work [New Manila Candy Workers Union (NACONWA-PAFLU) v. Court of
Industrial Relations, G.R. No. L-29728, 
October 30, 1978, 86 SCRA 37; Durabilt
Recapping Plant and Co. v. National Labor Relations Commission, G.R. No. 76746,
July 27, 1987, 152 SCRA 328.] Where the employee was not dismissed and his
failure to work was not due to the employer’s fault, the burden of economic
loss suffered by the employee should not be shifted to the employer [SSS v. SSS
Supervisors’ Union-CUGCO, G.R. No. L-31832, October 23, 1982, 117 SCRA 746; Durabilt Recapping Plant
and Co. v. National Labor Relations Commission, supra.] In
this case, private respondent’s failure to work
was due to the misunderstanding between
the petitioner’s management and private respondent.  As correctly observed by the Labor Arbiter,
private respondent must have construed the October 28 incident as his dismissal
so that he opted not to work for many days thereafter and instead filed a
complaint for illegal dismissal [Decision of Labor Arbiter, p. 6; Rollo, p. 30.] On the other hand, petitioner interpreted
private respondent’s failure to report for work as an intentional abandonment
[“Annex B” to the Petition, p. 5; Rollo, p.
24.] However, there was no intent to dismiss private respondent since the
petitioner is willing to reinstate him. 
Nor was there an intent to abandon on the part
of private respondent since he immediately filed a complaint for illegal
dismissal soon after the October 28 incident. 
It would be illogical for private respondent to abandon his work and
then immediately file an action seeking his reinstatement [Judric
Canning Corporation v. Inciong, G.R. No. 51494,
August 19, 1982, 115 SCRA 887; Flexo Manufacturing
Corporation v. National Labor Relations Commission, G.R. No. 55971, February
28, 1985, 135 SCRA 145; Remerco Garments
Manufacturing v. Ministry of Labor and Employment, G.R. Nos. 56176-77, February
28, 1985, 135 SCRA 167.] Under these circumstances, it is but fair that each
party must bear his own loss, thus placing the parties on equal footing [Pan
American World Airways, Inc. v. Court of Industrial Relations, et al., G.R. No.
L-20434, July 30, 1866, 17 SCRA 813;
SSS v. SSS Supervisors’ Union-CUGCO, supra.]

As to the separation pay, considering that petitioner has
expressed its willingness to reinstate private respondent to his former
position, the order for the payment of separation pay is no longer necessary.

WHEREFORE, premises considered, the decision of respondent
NLRC is REVERSED and SET ASIDE.  The
decision of the Labor Arbiter is REINSTATED.

SO ORDERED.

Fernan, C.J., Gutierrez, Jr.,
Feliciano, and Bidin,
JJ., concur.