KINGSIZE MANUFACTURING CORP., AND CHARLIE CO, PETITIONERS, VS. NATIONAL LABOR RELATIONS COMMISSION, ANACORITA VALDE, CELSA DIZON, TERESITA ORIBIANA, ET AL., RESPONDENTS.

This is a petition for certiorari to annul the decision
and two resolutions of the National Labor Relations Commission (First Division)
in NLRC NCR Case Nos. 00-09-03984-88, 06-11-04716-88, and 00-09­04030-88,
reversing the Labor Arbiter’s decision and ordering petitioners to reinstate
private respondents and pay them backwages equivalent to their salaries for
three years.

The facts are as follows:

Petitioner is a garment factory. Private respondents were its employees. Most of private respondents were hired as early as 1978, the rest in
1987, as sewers on piece work basis, with the exception of respondent Juancho
Bognot who was an assistant cutter and later supervisor.

At various times between June 1987 and January 1988, private
respondents were dismissed by petitioners for abandonment of work allegedly
because private respondents had not reported for work. When private respondents presented
themselves, they were prevented from entering the work place by petitioners’
agent, Charlie Co.

Within a few days of their dismissal, private respondents were
able to secure employment at another
garment factory, the First General Marketing Corporation (FGMC). Two of the respondents, Anacorita Valde and
Celsa Dizon, were in fact employed at the FGMC on the same day they were
dismissed by petitioners.

On September 21 and 26, 1988 and November 17, 1988, private
respondents filed complaints against petitioners for illegal dismissal,
underpayment of minimum wage, Emergency Cost of Living Allowance (ECOLA) and
overtime pay, and for non-payment of legal holiday pay and service incentive
leave pay, as well as 13th Month pay and attorney’s fees. Their complaints were filed with the
Department of Labor where they were later consolidated.

Petitioners submitted a paper in which they denied the charges
against them and claimed that respondents had abandoned their jobs by “not
reporting for work for quite sometime.” With respect to respondent Juancho
Bognot, it was alleged that he had been dismissed for “irresponsibility on
the job during the latter part of his employment” and for absenting
himself from work without leave from petitioners.^[1]

The Labor Arbiter^[2] found
that, with the exception of respondent Juancho Bognot, the complainants had
quit their jobs in order to work for the FGMC. Hence, in his decision rendered on May 31, 1989, the Labor Arbiter
dismissed their claim for reinstatement. With respect to Juancho Bognot, the Labor Arbiter found that he had been
illegally dismissed and so ordered him paid backwages for six months.

On the other hand, the Labor Arbiter granted the claims of
Teresita Oribiana, Petra Calim, and Yolanda Parungo for Emergency Cost of
Living Allowance (ECOLA), legal holiday pay, 13th month pay and service
incentive leave with pay and the claims of Teresita Olajo and Agnes Onano for
COLA, legal holiday pay and 13th month pay. No service incentive leave with pay was granted to Enano and Olajo for
the reason that they had less than one year of service in the factory.

The dispositive portion of the Labor Arbiter’s decision reads:

ACCORDINGLY, respondents Kingsize Mfg. Corporation and/or Charlie
Co are hereby ordered to reinstate within ten (10) days from receipt hereof,
herein complainant Juancho Bognot to his former or any substantially equivalent
position without loss of seniority right and privileges with six (6) months
backwages including his money award herein in the amounts of One Thousand Nine
Hundred One Pesos (P1,901.00) in the concept of differentials in emergency cost
of living allowance; One Thousand Two Hundred Twenty Nine and Twenty Five
Centavos (P1,229.25), as salary differentials; Ninety-Seven Pesos and Seventy-Seven
Centavos (P99.77) and Forty Two Pesos (P42.00), as differentials in 13th month
pay and legal holiday pay, respectively.

Further, the same respondents are also ordered within the same
period to pay complainants Parungo, Calim, Enano, Olajo, and Oribiano, their
respective underpayment of emergency cost of living allowance in the amount of
7.00 daily, legal holiday pay, 13th month pay differentials, and service
incentive leave with pay except Enano and Olajo who had rendered less than one
year service with respondents, to be based on their respective length of
service.

For this purpose, the Office of the Information and Research Unit
of this Region is hereby directed to make the remaining computation in
accordance with the discussion herein within a reasonable period of time after
the finality of this decision.

All other claims are hereby denied for lack of merit.

SO ORDERED.^[3]

On June 30, 1989, five of the complainants, Anacorita Valde, Judy
Dreu, Lydia Llobit, Marlene Bognot, and Celsa Dizon, appealed the Labor
Arbiter’s decision finding them guilty of abandoning their jobs. These complainants, who were granted no
monetary awards, prayed that they be granted separation pay. The other complainants, Teresita Oribiana,
Teresita Olajo, Agnes Enano, Petra Calim and Yolanda Parungo, whose money
claims had been granted, did not appeal, although as will presently be
discussed, a claim is now made in their behalf that they should be deemed to
have appealed insofar as they were found to have abandoned their jobs.

On the other hand, petitioners appealed with respect to the Labor
Arbiter’s decision ordering them to reinstate Juancho Bognot and pay backwages
to him.

On October 30, 1992 the NLRC rendered a decision, reversing the
Labor Arbiter and finding petitioners guilty of illegally dismissing the
“herein complainants,” meaning all the herein respondents. The NLRC ordered the reinstatement of these
employees to their former positions without loss of seniority rights but
without backwages. The decision with
respect to Juancho Bognot was affirmed. The dispositive portion of the decision reads:

WHEREFORE, premises considered, the
appealed decision is hereby REVERSED insofar as the Order dismissing the
complaint for dismissal is concerned. Respondents are ordered to REINSTATE the herein complainants to their
former position[s] without loss of seniority rights. Except for complainant Juancho Bognot to whom the award of
backwages and other monetary benefits is being AFFIRMED, reinstatement of the
rest of complainants shall be without backwages. Respondents’ appeal, on the other hand, is hereby DISMISSED for
lack of merit.

SO ORDERED.

On November 27, 1992, the five complainants, namely, Anacorita
Valde, Judy Dreu, Lydia Llobit, Marlene Bognot, and Celsa Dizon, moved for a
reconsideration of the decision insofar as their reinstatement was ordered to
be without backpay.

In its resolution of February 17, 1993, the NLRC granted their
motion and ordered them paid backwages equal to three years of their salaries
at the time of their dismissal. In
other respects, the decision of October 30, 1992 was affirmed.

Petitioners filed a “Motion for Leave to Reconsider
Resolution dated February 17, 1993” in which they sought to set aside the
order to reinstate the complainants, but their motion was denied by the NLRC in
its resolution dated April 22, 1993.^[4]
Hence, this petition.

Petitioners allege that the NLRC gravely abused its discretion
in:

1. Holding that abandonment of employment can
only be proved by a written notice to the employees to return to work with
warning of dismissal in case of his failure to report for work.

2. In giving credence to the claim of private
respondents that they could not have abandoned their jobs because they were
receiving more benefits from petitioners than from their new employer.

3. In disregarding the fact that respondents
did not file a complaint immediately upon their dismissal because they did not
allegedly know their rights.

4. In ordering the reinstatement of all the
respondents despite the fact that in their bill of particulars, position paper
and notice of partial appeal, the respondents merely asked for separation pay
and only five of them appealed from the
decision of the Labor Arbiter, finding them guilty of abandonment.

The first question here is whether the NLRC gravely abused its
discretion in finding that petitioners were guilty of illegal dismissal of
their employees. Findings of facts of
the NLRC are entitled to great respect and will not be disturbed in the absence
of any showing that they are not supported by substantial evidence.^[5]

Petitioners’ defense below was that private respondents had
abandoned their jobs. Petitioners thus
had the burden of proving “a clear and deliberate intent” on the part
of the private respondents to discontinue employment without any intention of
returning.^[6]
They had to prove a deliberate and unjustified refusal on the part of the
employee to resume his employment and such refusal must be clearly shown. Mere absence is not sufficient. It must be accompanied by overt acts
unerringly pointing to the fact that the employee simply does not want to work
anymore.^[7]

Petitioners contend that complainants abandoned their jobs as
shown by the fact that shortly after they had been dismissed by petitioners
they were able to find employment at the FGMC. Indeed the following appears:

1. Anacorita Valde, who was dismissed on June
15, 1987, was employed by First General Marketing Corporation on the same day,
June 15, 1987.

2. Celsa Dizon, who was dismissed on June 15,
1987, was also employed at First General Marketing Corporation on June 15,
1987, on the same day.

3. Yolanda Parungo, who was dismissed on
January 6, 1988, started work at First General Marketing Corporation on January
7, 1988.

4. Petra Calim, who was dismissed on January
7, 1988, was employed at First General Marketing Corporation on January 8,
1988.

5. Agnes Enano, who was dismissed on December
14, 1987, was employed by First General Marketing Corporation on January 7,
1988.

6. Erlinda Aguirre, who was dismissed on
December 14, 1987, was employed by First General Marketing Corporation on
December 17, 1987.

7. Teresita Oribiana, who was dismissed on
December 14, 1987, was hired by First General Marketing Corporation on December
28, 1987.

8. Marlene Bognot, who was allegedly dismissed
on December 15, 1987, started work at First General Marketing Corporation on
December 22, 1987.

9. Judy Dreu, who was also allegedly dismissed
on December 15, 1987, was employed by First General Marketing Corporation on
December 28, 1987.

10. Lydia Llobit, who was dismissed on December
15, 1987, was employed by First General Marketing Corporation on December 27,
1987.^[8]

We do not think, however, that this circumstance alone is proof
of a “clear and deliberate intent” on the part of the private
respondents not to continue work with petitioners. As the NLRC held, this was due to the fact that in the work place
the demand for experienced, high-speed sewers was quite great. On the other hand, the countervailing
evidence found by the NLRC tend to negate any inference of abandonment. These are: (1) the unrebutted allegation that petitioners’ representative, Edward
Co, barred private respondents from entering the premises of the company when
they reported for work; (2) the equally uncontested claim of private
respondents that they were earning more from petitioners’ factory and (3) the
fact that private respondents had already attained security of tenure in
petitioners’ company compared to their probationary status at the FGMC.

Indeed, it is noteworthy that aside from these circumstances
negating petitioners’ allegation, private respondents’ employment at the FGMC
took place after, not before, their dismissal by
petitioners. It would have been a
different matter if it was shown that, at the time of their dismissals, private
respondents had been employed at the FGMC.

That it took private respondents nine months before filing their
complaints for illegal dismissal could be due in part to the fact that, having
found ready employment, they did not feel the urgent need to file their
complaints earlier and partly to the fact that, as found by the NLRC, private
respondents only became aware of their rights under the law after they were
employed at the FGMC where there is a union.

In addition, petitioners’
failure to give notice with warning to the private respondents before
their services were terminated puts in grave doubt petitioners’ claim that the
dismissal was for a just cause. Sec. 2,
Rule XIV of the Rules Implementing the Labor Code provides:

Any employer who seeks to dismiss a worker shall furnish him a written
notice stating the particular acts or omission constituting the grounds for
dismissal. In case of abandonment of
work, the notice shall be served at the worker’s last known address.

The notice required, as elaborated upon in our decision in Pepsi-Cola Bottling Co., v. NLRC,^[9] actually consists of two parts to be
separately served on the employee, to wit: (1) notice to apprise the employee of the particular acts or omissions
for which his dismissal is sought; and (2) subsequent notice to inform him of
the employer’s decision to dismiss him.

This requirement is not a mere technicality but a requirement of
due process to which every employee is entitled to insure that the employer’s
prerogative to dismiss or lay-off is not abused or exercised in an arbitrary
manner.^[10]
This rule is clear and unequivocal and in applying it to this case the NLRC,
far from acting in excess of its jurisdiction, acted according to law.

Having determined that private respondents were illegally
dismissed, the next question is whether the NLRC gravely abused its discretion
in ordering their reinstatement considering that, in appealing the Labor
Arbiter’s decision, they only asked for separation pay. In general, the remedy for illegal dismissal
is the reinstatement of the employee to his former position without loss of
seniority rights and the payment to him of backwages.^[11]
But there may be instances where reinstatement is not a viable remedy as where
in the meantime the business of the employer has closed^[12]
or where the relations between the employer and employee have been so severely
strained that it is not advisable to order reinstatement,^[13]
or where the employee decides not to be reinstated.^[14]
In such events the employer will instead be ordered to pay separation pay.

Considering the fact that private respondents, in appealing the
decision of the Labor Arbiter, reduced their original demand for reinstatement
to a prayer for separation pay, there is merit in petitioners’ contention that
the NLRC exceeded its jurisdiction in ordering their reinstatement. The Solicitor General agrees with this
contention. Indeed, it could be that
after staying in the new jobs these complainants had had a change of mind about
reinstatement.

Moreover, as the Solicitor General points out, the NLRC should
have limited its decision to five of the complainants since they were the only
ones who had appealed from the decision of the Labor Arbiter. These complainants were Marlene Bognot,
Lydia Llobit, Anacorita Valde, Celsa Dizon and Judy Dreu.

As to the other six (6) respondents who did not appeal, namely
Teresita Oribiana, Teresita Olajo, Agnes Enano, Petra Calim, Yolanda Parungo
and Erlinda Aguirre, the Labor Arbiter’s decision became final and executory^[15]
upon the expiration of the reglementary period of 10 days as prescribed in art.
223 of the Labor Code. The NLRC acted
in excess of its jurisdiction in including these complainants in its decision.

The case of Juancho Bognot should be considered separately. The Labor Arbiter found that he had been
illegally dismissed and ordered him to be reinstated with backwages. The order of reinstatement is affirmed
because this respondent was not one of those who appealed to the NLRC and asked
for separation pay.

WHEREFORE, the decision of the NLRC is AFFIRMED, with the
modification that instead of ordering petitioners to reinstate respondents
Anacorita Valde, Judy Dreu, Lydia Llobit, Marlene Bognot, and Celsa Dizon, they
should only be granted separation pay at the rate of one month for every year
of service.

SO ORDERED.

Narvasa, C.J.,
(Chairman), Regalado, and Puno, JJ., concur.

^[1]
Rollo, p. 80.

^[2]
Hon. Felipe T. Garduque II.

^[3]
Rollo, pp. 97-98.

^[4]
Rollo, p. 54.

^[5]
Manila Mandarin Employees Union v. NLRC, 154 SCRA 368 (1987).

^[6]
Century Textile Mills, Inc. v. NLRC, 167 SCRA 528 (1988); Mangagawa ng
Komunikasyon sa Pilipinas v. NLRC, 194 SCRA 573 (1991).

^[7]
Flexo Manufacturing Corp. v. NLRC, 135 SCRA 145 (1985).

^[8]Solicitor
General’s Comment in behalf of Public Respondent, pp. 3-4.

^[9]
210 SCRA 277 (1992).

^[10]
Cebu Royal Plant (SMC) v. Deputy Minister of Labor, August 12, 1987, 153
SCRA 38 (1987); NLU v. NLRC, 153 SCRA 228 (1987); Piedad v. Lanao
del Norte Electric Cooperative, Inc., 153 SCRA 500 (1987).

^[11]
Santos v. NLRC, 154 SCRA 166 (1987).

^[12]
Callanta v. Carnation Philippines, 145 SCRA 268 (1986); Pizza Inn v.
NLRC, 162 SCRA, 773 (1988).

^[13]
Asiaworld Publishing House, Inc. v. Ople, 152 SCRA 219 (1987).

^[14]
Starlite Plastic Industrial Corp. v. NLRC, 171 SCRA 315, 326 (1989).

^[15]
Encilla v. Magsaysay, 17 SCRA 725 (1966).