CAPILI vs.

NLRC
1997 Mar 26; G.R. No. 117378
BELLOSILLO, J.:
Respondents Benigno Santos, Delfn Yuson, Luisito Santos, Ursino Basister,
Ricardo Reyes, Joselito Santos, Jorge Binuya and Nicolas Mulingbayan are
licensed drivers of public utility eepneys plying t!e Libertad"Sta# $ru% route
in Manila# &!e eepneys 'ere for(erly o'ned by petitioner )il $apili# *or t!e
use of t!e eepney for t'elve !ours a driver 'ould pay rent or so"called
+boundary+ of ,-./#// and earn a net proft of ,-//#// per day#
0n 1 May 2332, at a ti(e '!en petitioner Ricardo $apili ointly 'it! !is 'ife
!ad assu(ed o'ners!ip and operation of t!e eepneys driven by private
respondents, t!e latter and t!e ot!er drivers si(ilarly situated 'ere re4uired
by t!e eepney operators to sign individually contracts of lease of t!e
eepneys to for(ali%e t!eir lessor"lessee relations!ip# 5o'ever, !aving
gat!ered t!e i(pression t!at t!e signing of t!e contracts of lease 'as a
condition precedent before t!ey could continue driving for petitioners, all t!e
drivers stopped plying t!eir assigned routes beginning 1 May 2332#
6 'ee7 later or on 28 May 2332 t!e drivers, nu(bering t'enty"t'o 9--:, fled
a co(plaint for illegal dis(issal before t!e Labor 6rbiter praying not for
reinstate(ent but for separation pay# 2
;n t!e interi(, fourteen 928: of t!e co(plainants desisted and resu(ed
plying t!eir routes# &!e re(aining eig!t 9.: co(plainants 'it! t!eir rec7oning
dates of e(ploy(ent follo'< 9a: Benigno Santos, 231-= 9b: Jorge Binuya,
23>?= 9c: Luisito Santos, 23.-= 9d: Delfn Yuson, 23.@= 9e: Ursino Basister,
23./= 9f: Ricardo Reyes, 23.?= 9g: Joselito Santos, 23.3= and, 9!: Nicolas
Mulingbayan, 231.#
,etitioners opposed t!e clai( of private respondents before t!e Labor 6rbiter
alleging t!at t!e latter voluntarily abandoned t!eir respective obs 'it!out
any valid cause and t!ereafter refused and still continue to refuse to return
to 'or7 despite repeated de(ands andAor notices given to t!e( to return to
'or7#
;n resolving t!e dispute, t!e Labor 6rbiter ruled
0n t!e issue of dis(issal versus abandon(ent, 'e are inclined to believe
t!at t!e latter scenario !appened# ;t is not sound business practice to
dis(iss (any e(ployees at t!e sa(e ti(e since it 'ould cripple t!e
operations#
B!at 'as (ore li7ely 'as t!at t!e drivers, all -- of t!e( # # # boycotted
respondents on May 1, 2332 by not reporting for 'or7 on t!at day#
CDD DDD
DDD
*ro( t!e vie'point of co(plainants, t!eir signing of t!e lease contract 'as a
condition sine 4ua non to t!e continuous driving of t!eir respective drivers
9eepneysE:# But fro( t!e point of vie' of respondent $apili and as s!o'n in
t!e afore4uoted paragrap! ? of !is aFdavit, and as furt!er s!o'n in t!e
notices 9GD!ibits +@"B+ and +@"B"2+: '!ic! (erely as7ed co(plainants to
return to 'or7 'it!out (entioning any condition li7e t!e signing of t!e
contract, t!e signing of t!e lease contract by t!e drivers 'as (erely
intended as a confr(ation of t!e original concept of a no e(ployer"
e(ployee relations!ip, and to strea(line t!e operation by indicating t!e
a(ount of t!e boundary per driver, depending on t!e nu(ber of !ours t!ey
drive and t!eir obligation to c!ec7 on t!e (otorAengine, oil, tires, bra7es and
ot!er routinary re4uire(ents in order to insure t!e ve!iclesH road'ort!iness#
;t 'as never (eant to be t!at if a driver refuses to sign t!e contract, !e
'ould not be allo'ed to continue driving#
&o our (ind, bot! parties (isappreciated t!e situation# RespondentsH
erroneous insistence of a no e(ployer"e(ployee relations!ip even in t!e
face of a 'ell"establis!ed contrary doctrine as postulated in t!e Dinglasan
case - 93. ,!il# >83: and co(plainantsH erroneous appre!ension of t!e loss
of suc! e(ployer"e(ployee relations!ip if t!ey sign t!e lease contract
propelled t!e co(plainants to fle t!e instant co(plaint#
;n s!ort, t!is is (erely a si(ple case of (isunderstanding#
&o re(edy t!e situation, 'e feel t!at t!e (ost prudent approac! 'ould be to
let t!e parties return to t!e relations!ip t!at eDisted bet'een t!e( prior to
May 1, 2332# @
&!e Labor 6rbiter t!us concluded
B5GRG*0RG, decision is !ereby rendered declaring t!e brea7age 9sic:, of
relations!ip bet'een respondent Ricardo $apili and co(plainants Benigno &#
Santos, Delfn Yuson, Luisito Santos, Ursino Basister, Ricardo Reyes, Joselito
Santos, Jorge Binuya and Nic!olas Mulingbayan, as a product of
(isunderstanding and (isappreciation of t!e situation by bot! parties and,
t!erefore, respondents are !ereby directed to reinstate t!e( to t!eir for(er
position 'it!out loss of seniority rig!ts and ot!er benefts, but 'it!out bac7
'ages 9p# 1, 6nneD +*+:# 8
,rivate respondents appealed to t!e National Labor Relations $o((ission#
&!ey reiterated t!eir prayer for separation pay e4uivalent to one 92: (ont!
salary for every year of service and, in addition, t!ree 9@: years bac7 'ages#
Respondent NLR$ up!eld t!e fnding of t!e Labor 6rbiter t!at t!e case arose
due to si(ple (isunderstanding bet'een t!e co(plaining drivers on one
!and and t!eir e(ployers on t!e ot!er# 5o'ever, it too7 eDception to t!e
relief granted to private respondents and (odifed t!e appealed decision
accordingly by !olding t!at
Since t!ere 'as (isunderstanding bet'een t!e parties and t!is
(isunderstanding resulted in ani(osity and strained relations!ip bet'een
t!e(, 'e dee( it proper and (ost prudent approac! to (aintain industrial
peace for respondents to pay t!e co(plainants t!eir separation pay of one
!alf 92A-: (ont! for every year of service, based on t!eir daily earnings of
,-//#//# ?
&!e petitioners (oved to !ave t!e above dis4uisition of respondent NLR$
reconsidered but t!e latter denied t!e (otion# &!ey no' co(e to us arguing
t!at since t!ere 'as a clear fnding of abandon(ent by t!e Labor 6rbiter
consisting in t!e failure of private respondents to report for 'or7 'it!out
ustifable reason, t!e a'ard of separation pay could not be 'arranted#
&!e NLR$ brus!ed aside t!e argu(ents of petitioners# ;t e(p!asi%ed t!at if it
'ere t!e fnding of t!e Labor 6rbiter t!at private respondents 'ere guilty of
abandon(ent !e 'ould not !ave ordered reinstate(ent but dis(issal of t!e
case# &!us on 3 6ugust 2338 NLR$ denied reconsideration#
,etitioners i(pute grave abuse of discretion on t!e part of respondent NLR$
in a'arding separation pay to private respondents#
Be agree 'it! petitioners# &!e legal basis for t!e a'ard of separation pay is
clearly provided by 6rt# -13 of t!e Labor $ode '!ic! states t!at t!e re(edy
for illegal dis(issal is reinstate(ent 'it!out loss of seniority rig!ts plus bac7
'ages co(puted fro( t!e ti(e co(pensation 'as 'it!!eld up to
reinstate(ent# 5o'ever t!ere (ay be instances '!ere reinstate(ent is not a
viable re(edy as '!ere t!e relations bet'een e(ployer and e(ployee !ave
been so severely strained t!at it is no longer advisable to order
reinstate(ent or '!ere t!e e(ployee decides not to be reinstated# ;n suc!
events, t!e e(ployer 'ill instead be ordered to pay separation pay# >
6 reading of 6rt# -13 in relation to 6rt# -.- of t!e Labor $ode reveals t!at an
e(ployee '!o is dis(issed for cause after appropriate proceedings in
co(pliance 'it! t!e due process re4uire(ents is not entitled to an a'ard of
separation pay# Under 6rts# -.@ and -.8 of t!e sa(e $ode, separation pay is
aut!ori%ed only in cases of dis(issals due to any of t!ese reasons< 9a:
installation of labor saving devices= 9b: redundancy= 9c: retrenc!(ent= 9d:
cessation of t!e e(ployerHs business, and, 9e: '!en t!e e(ployee is
suIering fro( a disease and !is continued e(ploy(ent is pro!ibited by la'
or is preudicial to !is !ealt! and to t!e !ealt! of !is co"e(ployees# 1
5o'ever, separation pay s!all be allo'ed as a (easure of social ustice in
t!ose cases '!ere t!e e(ployee is validly dis(issed for causes ot!er t!an
serious (isconduct or t!ose reJecting on !is (oral c!aracter, but only '!en
!e 'as illegally dis(issed#
&!e co((on deno(inator of t!ose instances '!ere pay(ent of separation
pay is 'arranted is t!at t!e e(ployee 'as dis(issed by t!e e(ployer# ;n t!e
instant case t!ere 'as no dis(issal at all# Respondent NLR$ aFr(ed t!e
factual fndings of t!e Labor 6rbiter t!at t!ere 'as only a (isunderstanding
bet'een petitioners and private respondents '!ic! caused t!e latter to stop
reporting for 'or7# ;f t!e Labor 6rbiter ordered reinstate(ent it s!ould not be
construed as relief proceeding fro( illegal dis(issal= instead, it s!ould be
considered as a declaration or aFr(ation t!at private respondents (ay
return to 'or7 because t!ey 'ere not dis(issed in t!e frst place, and t!ey
s!ould be !appy t!at t!eir e(ployers are accepting t!e( bac7# &!is could be
t!e reason '!y co(plainants as7ed only for separation pay not for
reinstate(ent in t!eir co(plaint before t!e Labor 6rbiter#
&!e a'ard of separation pay cannot be ustifed solely because of t!e
eDistence of +strained relations+ bet'een t!e e(ployer and t!e e(ployee# ;t
(ust be given to t!e e(ployee only as an alternative to reinstate(ent
e(anating fro( illegal dis(issal# B!en t!ere is no illegal dis(issal, even if
t!e relations are strained, separation pay !as no legal basis# Besides, t!e
doctrine on +strained relations+ cannot be applied indiscri(inately since
every labor dispute al(ost invariably results in +strained relations=+
ot!er'ise, reinstate(ent can never be possible si(ply because so(e
!ostility is engendered bet'een t!e parties as a result of t!eir disagree(ent#
&!at is !u(an nature# .
&!e constitutional policy of providing full protection to labor is not intended
to oppress or destroy (anage(ent# &!e co((it(ent of t!is $ourt to t!e
cause of labor does not prevent us fro( sustaining t!e e(ployer '!en it is in
t!e rig!t, as in t!is case# 3
B!en respondents fled t!eir co(plaint, and ta7ing account of t!e
allegations t!erein, t!ey foreclosed reinstate(ent as a relief, since t!ey
prayed only for an a'ard of separation pay# &!is is confr(ed in t!eir appeal
to t!e NLR$ '!ere t!ey prayed for a (odifcation of t!e decision of t!e Labor
6rbiter, fro( reinstate(ent 'it!out bac7 'ages to pay(ent of t!ree 9@:
years bac7 'ages and separation pay e4uivalent to one 92: (ont! salary for
every year of service# 2/ ;t is t!erefore clear t!at respondents never desired
to be reinstated# &!is being so, t!e $ourt cannot order t!e( to return to
'or7# 22 ;f private respondents voluntarily c!ose not to return to 'or7
any(ore t!ey (ust be considered as !aving resigned fro( t!eir
e(ploy(ent# &!is is 'it!out preudice !o'ever to t!e 'illingness of bot!
parties to continue 'it! t!eir for(er contract of e(ploy(ent or enter into a
ne' one '!enever t!ey so desire#
B5GRG*0RG, t!e petition is )R6N&GD and t!e e(ployer"e(ployee
relations!ip bet'een petitioners on one !and and eac! private respondent
on t!e ot!er is dee(ed voluntarily ter(inated# $onse4uently, t!e decision of
respondent National Labor Relations $o((ission dated -. *ebruary 2338 is
RGKGRSGD and SG& 6S;DG#
S0 0RDGRGD#
,adilla, Kitug, Lapunan and 5er(osisi(a, Jr#, JJ#, concur#