Alcantara & Sons v. CA (G.R. No. 155109. March 14, 2012)


FACTS: These cases were consolidated based on the following facts as follows:

The negotiation between CASI and the Union on the economic provisions of the CBA ended in a deadlock prompting the Union to stage a strike,but the strike was later declared by the LA to be illegal in violation of the CBAs no strike-no lockout provision.Consequently, the Union officers were deemed to have forfeited their employment with the company and made them liable for actual damages plus interest and attorneys fees, while the Union members were ordered to be reinstated without backwages there being no proof that they actually committed illegal acts during the strike.

Notwithstanding the provision of the Labor Code mandating that the reinstatement aspect of the decision be immediately executory, the LA refused to reinstate the dismissed Union members. On November 8, 1999, the NLRC affirmed the LA decision insofar as it declared the strike illegal and ordered the Union officers dismissed from employment and liable for damages but modified the same by considering the Union members to have been validly dismissed from employment for committing prohibited and illegal acts.

On petition forcertiorari, the CA annulled the NLRC decision and reinstated that of the LA. Aggrieved, CASI, the Union and the Union officers and members elevated the matter to the Court.

During the pendency of the cases, the affected Union members (who were ordered reinstated) filed with the LA a motion for reinstatement pending appeal and the computation of their backwages. But the LA awarded separation pay and other benefits. On appeal, the NLRC denied the Union members claim for separation pay, accrued wages and other benefits.When elevated to the CA, the appellate court held that reinstatement pending appeal applies only to illegal dismissal cases under Article 223 of the Labor Code and not to cases under Article 263. Hence, the petition by the Union and its officers and members in G.R. No. 179220.

The Court agreed with the CA on the illegality of the strike as well as the termination of the Union officers, but disagreed with the CA insofar as it affirmed the reinstatement of the Union members. The Court, instead, sustained the dismissal not only of the Union officers but also the Union members who, during the illegal strike, committed prohibited acts by threatening, coercing, and intimidating non-striking employees, officers, suppliers and customers; obstructing the free ingress to and egress from the company premises; and resisting and defying the implementation of the writ of preliminary injunction issued against the strikers.

The Court further held that the terminated Union members, who were ordered reinstated by the LA, should have been immediately reinstated due to the immediate executory nature of the reinstatement aspect of the LA decision. In view, however, of CASIs failure to reinstate the dismissed employees, the Court ordered CASI to pay the terminated Union members their accrued backwages from the date of the LA decision until the eventual reversal by the NLRC of the order of reinstatement. In addition to the accrued backwages, the Court awarded separation pay as a form of financial assistance to the Union members equivalent to one-half month salary for every year of service to the company up to the date of their termination.

Hence, this motion for partial reconsideration by the petitioner.


Whether or not the petitioner is liable to pay the accrued wages of the dismissed employees?

Whether or not the Court erred in awarding separation pay to the dismissed union officers and employees?


The motion for partial reconsideration is partly granted.


Article 264 (a) of the Labor Code provides for the liabilities of the Union officers and members participating in illegal strikes and/or committing illegal acts. Thus, the said provision sanctions the dismissal of a Union officer who knowingly participates in an illegal strike or who knowingly participates in the commission of illegal acts during a lawful strike. In this case, the Union officers were in clear breach of the above provision of law when they knowingly participated in the illegal strike.

As to the Union members, the same provision of law provides that a member is liable when he knowingly participates in the commission of illegal acts during a strike. We find no reason to reverse the conclusion of the Court that CASI presented substantial evidence to show that the striking Union members committed the following prohibited acts: (a) They threatened, coerced, and intimidated non-striking employees, officers, suppliers and customers;(b) They obstructed the free ingress to and egress from the company premises; and (c) They resisted and defied the implementation of the writ of preliminary injunction issued against the strikers.

The commission of the above prohibited acts by the striking Union members warrants their dismissal from employment.

Records show that the LA found the strike illegal and sustained the dismissal of the Union officers, but ordered the reinstatement of the striking Union members for lack of evidence showing that they committed illegal acts during the illegal strike. This decision, however, was later reversed by the NLRC.Pursuant to Article 223of the Labor Code and well-established jurisprudence, the decision of the LA reinstating a dismissed or separated employee, insofar as the reinstatement aspect is concerned, shall immediately be executory, pending appeal.[28]The employee shall either be admitted back to work under the same terms and conditions prevailing prior to his dismissal or separation, or, at the option of the employee, merely reinstated in the payroll. It is obligatory on the part of the employer to reinstate and pay the wages of the dismissed employee during the period of appeal until reversal by the higher court.If the employer fails to exercise the option of re-admitting the employee to work or to reinstate him in the payroll, the employer must pay the employees salaries during the period between the LAs order of reinstatement pending appeal and the resolution of the higher court overturning that of the LA.

In this case, CASI is liable to pay the striking Union members their accrued wages for four months and nine days, which is the period from the notice of the LAs order of reinstatement until the reversal thereof by the NLRC.


Separation pay may be given as a form of financial assistance when a worker is dismissed in cases such as the installation of labor-saving devices, redundancy, retrenchment to prevent losses, closing or cessation of operation of the establishment, or in case the employee was found to have been suffering from a disease such that his continued employment is prohibited by law.It is a statutory right defined as the amount that an employee receives at the time of his severance from the service and is designed to provide the employee with the wherewithal during the period that he is looking for another employment. It is oriented towards the immediate future, the transitional period the dismissed employee must undergo before locating a replacement job.As a general rule, when just causes for terminating the services of an employee exist, the employee is not entitled to separation pay because lawbreakers should not benefit from their illegal acts.The rule, however, is subject to exceptions.

In the case at bar, not only did the Court declare the strike illegal, rather, it also found the Union officers to have knowingly participated in the illegal strike. Worse, the Union members committed prohibited acts during the strike. Thus, the awards of separation pay as a form of financial assistance is deleted.

The motion for partial consideration by the petitioner is partly granted. The decision of the Court is partly reconsidered.