GR L 59407; (March, 1985) (Digest)
G.R. No. L-59407 March 29, 1985
CITY SERVICE CORP. WORKERS UNION, EMILIANO BILONOAC, JUANITO VALENCIA, NOEL VALENCIA and JULIETO ENOSLAY, petitioners, vs. CITY SERVICE CORPORATION, JAIME ABRAHAM, MANUEL L. VILLAMAYOR and NATIONAL LABOR RELATIONS COMMISSION, respondents.
FACTS
Petitioners were janitorial employees of respondent City Service Corporation (CSC), a company providing janitorial services to clients. They were assigned to the Army and Navy Club. On February 4, 1974, CSC terminated their employment based on the client’s report suspecting them of stealing club properties. The termination was effected without a prior formal investigation and, crucially, without the prior clearance from the Secretary of Labor as required by Presidential Decree No. 21. Consequently, petitioners filed an illegal dismissal case.
The Labor Arbiter ruled in favor of petitioners, ordering their reinstatement with backwages. On appeal, the National Labor Relations Commission (NLRC) sustained the finding of illegal dismissal due to the lack of the required prior clearance. However, the NLRC modified the remedy. Instead of ordering reinstatement, it awarded petitioners separation pay equivalent to one month’s salary for every year of service. The NLRC justified this by speculating that reinstatement had become “remote, and to say, impossible” due to the six-year lapse since their dismissal.
ISSUE
Whether the NLRC correctly awarded separation pay in lieu of reinstatement with backwages after finding that petitioners were illegally dismissed.
RULING
The Supreme Court ruled that the NLRC erred. The legal logic is anchored on the constitutional guarantee of security of tenure and the specific statutory remedy for illegal dismissal. Under the Labor Code, an unjustly dismissed employee is entitled to reinstatement without loss of seniority rights and to full backwages. The NLRC’s substitution of separation pay for reinstatement was based merely on speculation about the impossibility of reinstatement after six years, without any factual verification that no positions were available.
The Court emphasized that CSC remained in business providing janitorial services, and petitioners’ janitorial positions were not unique or difficult to reinstate. Security of tenure is a right of paramount constitutional value and cannot be denied on a nebulous basis. While the Court has, in compelling circumstances, limited backwages to a fixed period without deductions for interim earnings, the denial of reinstatement itself requires a solid factual foundation, which was absent here. Therefore, the Court ordered respondent CSC to reinstate petitioners to their former or substantially equivalent positions, with backwages equivalent to three years’ compensation, modifying the NLRC decision accordingly.