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College of the Immaculate Conception vs NLRC

G.R. No. 167563, March 22, 2010

Peralta, J.
FACTS: Petitioner, through its President, appointed Atty. Marius F. Carlos, respondent, as its acting dean effective from
June 1996- May 2000, with an understanding that upon expiration of his term, he shall be appointed as a full time
professor without diminution of his teaching salary as Dean.
After the expiration of his term, respondent requested for the payment of overload pay, arguing that the regular full time
load of a faculty member is only six and he had 8. Petitioner however denied the claim and directed to explain why no
disciplinary action should be taken against him for engaging in the practice of law and teaching law in another law school
without prior permission from the petitioner.
Respondent admitted that he was teaching at Araullo University without written permission because it was unnecessary.
As to his law practice, he explained that the only case he was handling was a petition for Declaration of Nullity of
Marriage, which was referred to him by petitioner's Vice-President for Academic Affairs. Respondent said that his
demotion from Dean of the Department to a Faculty member was without legal basis and that the non-renewal of his
appointment as Dean was arbitrary, capricious, unlawful, tainted with abuse of discretion, and injurious to his integrity
and reputation.
Petitioner refused to accept respondent's explanation that securing petitioner's prior written permission to teach elsewhere,
or to engage in any other remunerative occupation, is unnecessary. Petitioner gave respondent two options: to become a
full-time professor or a part time professor. Since respondent did not choose any, petitioner informed respondent that he
will not be assigned any teaching load for the succeeding semester pursuant to Section 16.8, CHED Memorandum No. 19,
series of 1998, which requires professors to give a formal notice when teaching in another school.
Aggrieved, respondent filed a case for illegal dismissal. The LA ruled that respondent was illegally dismissed and ordered
his reinstatement.
On appeal to the NLRC, the decision was set aside but the NLRC ordered to reinstate complainant as full-time professor.
Petitioner filed a motion for reconsideration arguing that respondent should be directed to refund the petitioner all the
amounts he received by way of payroll reinstatement but the same was denied. Petitioner filed a petition for certiorari to
the CA but the same was also denied. Upon denial of its motion for reconsideration, the instant petition is filed to the SC.
ISSUE: W/N the reversal of the LA's decision would require respondent to reimburse petitioner all the salaries and
benefits he received pursuant to the immediate execution of the LA's erroneous decision.
RULING: NO, mistake on the part of the LA cannot, in any way, alter the fact that during the pendency of the appeal of
his decision, his order for respondent's reinstatement as Dean was immediately executory. Article 223 of the Labor Code
explicitly provides that:
Art. 223. - Appeal. x x x
In any event, the decision of the Labor Arbiter reinstating a dismissed or separated employee, insofar as the
reinstatement aspect is concerned, shall immediately be executory, even pending appeal. 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 employer, merely reinstated in the payroll. The posting of a bond by the
employer shall not stay the execution for reinstatement provided therein.
The pertinent law on the matter is not concerned with the wisdom or propriety of the LA's order of reinstatement, for if it
was, then it should have provided that the pendency of an appeal should stay its execution. After all, a decision cannot be
deemed irrefragable unless it attains finality.
In Garcia v. Philippine Airlines, Inc., the Court made a very enlightening discussion on the aspect of reinstatement
pending appeal:
x x x [E]ven if the order of reinstatement of the Labor Arbiter is reversed on appeal, 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. On the other hand, if the employee has been reinstated during the appeal period and
such reinstatement order is reversed with finality, the employee is not required to reimburse whatever
salary he received for he is entitled to such, more so if he actually rendered services during the period.
The opposite view is articulated in Genuino vs NLRC which states:
If the decision of the labor arbiter is later reversed on appeal upon the finding that the ground for dismissal
is valid, then the employer has the right to require the dismissed employee on payroll reinstatement to
refund the salaries [he] received while the case was pending appeal, or it can be deducted from the accrued
benefits that the dismissed employee was entitled to receive from [his] employer under existing laws, collective

bargaining agreement provisions, and company practices. However, if the employee was reinstated to work during
the pendency of the appeal, then the employee is entitled to the compensation received for actual services
rendered without need of refund.
Considering that Genuino was not reinstated to work or placed on payroll reinstatement, and her dismissal is based on a
just cause, then she is not entitled to be paid the salaries stated in item no. 3 of the fallo of the September 3, 1994 NLRC
Decision. In the same case, the Court went on to discuss the illogical and unjust effects of the refund doctrine erroneously
espoused in Genuino.
Moreover, it bears stressing that the manner of immediate reinstatement, pending appeal, or the promptness thereof is
immaterial, as illustrated in the following two scenarios:
Situation No. 1. (As in the cases of Air Philippines Corporation and International Container Terminal Services, Inc.) The
LA ruled in favor of the dismissed employee and ordered his reinstatement. However, the employer did not immediately
comply with the LA's directive. On appeal, the NLRC reversed the LA and found that there was no illegal dismissal. In
this scenario, We ruled that the employee is entitled to payment of his salaries and allowances pending appeal.
Situation No. 2. (As in the present case) The LA ruled in favor of the dismissed employee and ordered the latter's
reinstatement. This time, the employer complied by reinstating the employee in the payroll. On appeal, the LA's ruling
was reversed, finding that there was no case of illegal dismissal but merely a temporary sanction, akin to a suspension.
Here, We also must rule that the employee cannot be required to reimburse the salaries he received because if he was not
reinstated in the payroll in the first place, the ruling in situation no. 1 will apply, i.e., the employee is entitled to payment
of his salaries and allowances pending appeal.
Thus, either way the court looks at it, at the end of the day, the employee gets his salaries and allowances pending appeal.
The only difference lies as to the time when the employee gets it.