Case Digest: Pangilinan v. Wellmade

G.R. No. 187005 : April 7, 2010




Petitioner Ferdinand Pangilinan was employed by Wellmade Manufacturing Corporation (respondent) as Key Account Specialist tasked to sell Speed Detergent products to supermarkets and groceries within his assigned area. In addition to his monthly salary of P9,300.00, he received sales commissions based on volume of sales, and was provided with a service vehicle.

Petitioner used the service vehicle to travel to Naga City without approval from respondent. While returning to Manila, the vehicle broke down and it took more than two days to have it repaired. Petitioner admitted having used the vehicle without respondents approval and reported the incident to respondents National Capital Region Sales Supervisor, Ireneo Tomas (Tomas).

Tomas and the District Sales Manager, Noel de la Cruz (de la Cruz) thereupon sent a memorandum to petitioner requiring him to explain within 48 hours why he should not be disciplined for the following charges: unofficial use of the service vehicle; absence without prior application and approval for 2-3 days (October 31 and November 2-3, 2003); use of company time or materials to do unauthorized work; insubordination; and "moonlighting.

By letter petitioner explained his reason therefore however, later, petitioner filed with the Labor Arbiter a complaint for constructive dismissal. Meanwhile, by Notice of Termination, respondent dismissed petitioner, finding him liable for the abovestated charges, and considering his consecutive absences as abandonment.

The Labor Arbiter found respondent liable for illegal dismissal and ordered it to pay petitioner separation pay computed at one month for every year of service, as well as proportionate 13th month pay and service incentive leave pay. The Labor Arbiter noted that the charges of unauthorized absences, unauthorized use of company time and materials and insubordination occurred in relation to the admitted unauthorized use of the service vehicle; and that the "moonlighting" charge was not substantiated. The Arbiter also observed that respondent neither controverted nor squarely addressed petitioners claim of being told to resign by his superiors to thus lead him to incur consecutive absences upon which his dismissal was anchored.

Both parties appealed to the NLRC, it granted both appeals by affirming and modifying the Labor Arbiters Decision

The Executive Labor Arbiters finding that Complainant was illegally dismissed from his employment was affirmed. The award of separation pay is deleted for lack of legal basis, but the award of 13th month pay for P8,339.00 and service incentive leave pay for P3,576.92 is affirmed.

On appeal, the Petition for Certiorari before the CA waspartially granted and accordingly modified the same.

Petitioner moved to reconsider the appellate courts decision but it was denied. Hence, the present petition which faults the appellate court for deleting the award of backwages.


Whether petitioner is entitled to the payment of backwages (in addition to separation pay, 13th month pay, service incentive leave pay and attorney's fees).


The entitlement to backwages is proper.


Article 279 of the Labor Code provides that "an employee who is unjustly dismissed from work shall be entitled to reinstatement without loss of seniority rights and other privileges and to his full backwages, inclusive of allowances, and to his other benefits or their monetary equivalent computed from the time his compensation was withheld from him up to the time of his actual reinstatement." An illegally dismissed employee is entitled to two reliefs: backwages and reinstatement. The two reliefs provided are separate and distinct. In instances where reinstatement is no longer feasible because of strained relations between the employee and the employer, separation pay is granted. In effect, an illegally dismissed employee is entitled to either reinstatement, if viable, or separation pay if reinstatement is no longer viable, and backwages.

The normal consequences of respondents illegal dismissal, then, are reinstatement without loss of seniority rights, and payment of backwages computed from the time compensation was withheld up to the date of actual reinstatement. 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. The payment of separation pay is in addition to payment of backwages. Macasero v. Southern Industrial Gases, G.R. No. 178524,January 30, 2009

Since reinstatement is no longer feasible in the present case, the award of separation pay in lieu of reinstatement is in order. Petitioners prayer for the award of backwages is meritorious, it, and the award of separation pay not being mutually exclusive.Nissan v. Serrano, G.R. No. 162538,June 4, 2009