Case Digest: Benares v. Tabaco Women's

G.R. No. 197353 : April 1, 2013




Petitioner was for some time the general manager of Tabaco Women's Transport Service Cooperative (T A WTRASCO) until its management, on March 6, 2006, terminated his services. On March 7, 2006, before the Labor Arbiter (LA) in RAB V of the NLRC in Legaspi City, petitioner filed a complaint for illegal dismissal and payment of monetary claims.

The LA ruled in favor of petitioner. Since TAWTRASCO opted not to appeal, the LA Decision soon became final and executory. In fact, TAWTRASCO in no time paid petitioner the amount of PhP 119, 600 by way of damages and backwages corresponding to the period March 6, 2006 to August 22, 2006. But petitioner was not immediately reinstated.

Eventually, the two entered into a Compromise Agreement, in which petitioner waived a portion of his monetary claim, specifically his backwages for the period from August 23, 2006 to February 5, 2007, and agreed that the amount due shall be payable in three (3) installments. In turn, TAWTRASCO undertook to reinstate the petitioner effective February 6, 2007. Accordingly, the LA issued, on February 5, 2007, an Orderbased on the compromise agreement thus executed, and declared the instant case closed and terminated.

Petitioner received a copy of Memorandum Order, with a copy of a resolution passed by the Board of Directors (BOD) of TAWTRASCO, requiring him to report at the companys Virac, Catanduanes terminal. The memorandum order contained an enumeration of petitioners duties and responsibilities.

A day after, petitioner went to see Oliva Barcebal (Oliva), the BOD Chairman, to decry that the adverted return-to-work memorandum and board resolution contravene the NLRC-approved compromise agreement which called for his reinstatement as general manager without loss of seniority rights. Subsequent events saw petitioner requesting and receiving an allocation of PhP 3,000 for his travel, accommodation, representation and communication allowance subject to liquidation. No replenishment, however, came after.

On April 12, 2007, Oliva, while conducting, in the company of another director, an ocular inspection of the Virac terminal, discovered that petitioner had not reported for work since March 31, 2007.

In response, petitioner reiterated that there is an ongoing mockery of the mandate of the NLRC decision that he should be reinstated to his former position as General Manager without loss of seniority rights. He further argued that what is truly happening is the obvious evidence that the company does not want him to work the way he was doing it before and the way as mandated by the by-laws of our transport cooperative.

In sum, petitioner states that he cannot charge for abandonment of work because the company is in fact causing him an inhumane and degrading treatment as General Manager and giving an embarrassing kind of work.

Petitioner filed a complaint against TAWTRASCO for nonpayment of salaries and withholding of privileges before the LA. LA ruled in favor of petitioner. On appeal, the NLRC affirmed the LA decision. TAWTRASCO went to the CA on certiorari where their petition was granted. Hence, this petition.

ISSUE: Whether or not there was a proper and genuine reinstatement of petitioner to his former position of General Manager of TAWTRASCO without loss of seniority rights and privileges

HELD: No. CA decision reversed and set aside.

Labor Law

Under Article 223 of the Labor Code, an employee entitled to reinstatement "shall either be admitted back to work under the same terms and conditions prevailing prior to his dismissal

Reinstatement, as a labor law concept, means the admission of an employee back to work prevailing prior to his dismissal; restoration to a state or position from which one had been removed or separated, which presupposes that there shall be no demotion in rank and/or diminution of salary, benefits and other privileges; if the position previously occupied no longer exists, the restoration shall be to a substantially equivalent position in terms of salary, benefits and other privileges.

Managements prerogative to transfer an employee from one office or station to another within the business establishment, however, generally remains unaffected by a reinstatement order, as long as there is no resulting demotion or diminution of salary and other benefits and/or the action is not motivated by consideration less than fair or effected as a punishment or to get back at the reinstated employee.

Guided by the foregoing reasonable albeit exaction norm, the "reinstatement" of petitioner as general manager of TAWTRASCO, effected by TAWTRASCO pursuant to the February 5, 2007 compromise agreement, was not a real, bona fide reinstatement in the context of the Labor Code and pertinent decisional law.

First, TAWTRASCO at the outset, i.e., after the compromise agreement signing, directed petitioner to report to the Virac terminal with duties and responsibilities not befitting a general manager of a transport company. In fine, the assignment partook of the nature of a demotion.

And second, while Memorandum No. 10 was couched as if TAWTRASCO had in mind the reinstatement of petitioner to his former position, there cannot be any quibble that TAWTRASCO withheld petitioners customary boarding house privilege. What is more, TAWTRASCO did not provide him with a formal office space. As evidence on record abundantly shows, TAWTRASCO was made aware of its shortcomings as employer, but it opted not to lift a finger to address petitioners reasonable requests for office space and free lodging while assigned at the Virac terminal.

The reinstatement order has not been faithfully complied with. And varied but justifiable reasons obtain which made petitioners work at the Virac terminal untenable. To reiterate, there was a lack of a viable office: no proper office space, no office furniture and equipment, no office supplies. Petitioners request for immediate remediation of the above unfortunate employment conditions fell on deaf ears. This is not to mention petitioners board and lodging privilege which he was deprived of without so much as an explanation. Thus, it could not be said that petitioners absence is without valid or justifiable cause.

Supervening events, however, had transpired which inexorably makes the reinstatement infeasible. Reinstatement is no longer viable where, among other things, the relations between the employer and employee have been so severely strained, that it is not in the best interest of the parties, nor is it advisable or practical to order reinstatement. Under the doctrine of strained relations, payment of separation pay is considered an acceptable alternative to reinstatement when the latter option is no longer desirable or viable.

Where reinstatement is no longer viable as an option, separation pay equivalent to one (1) month salary for every year of service should be awarded as an alternative.In lieu of reinstatement, petitioner is entitled to separation pay equivalent to one (1) month salary for every year of service reckoned from the time he commenced his employment with TAWTRASCO until finality of this Decision.