G.R. No. L-52415 October 23, 1984
INSULAR BANK OF ASIA AND AMERICA EMPLOYEES’ UNION (IBAAEU), petitioner, vs. HON. AMADO G. INCIONG, Deputy Minister, Ministry of Labor and INSULAR BANK OF ASIA AND AMERICA, respondents.

FACTS

Petitioner union filed a complaint against respondent bank for payment of holiday pay. On August 25, 1975, Labor Arbiter Ricarte T. Soriano rendered a decision granting the complaint, ordering the bank to pay wages for all regular holidays starting November 1, 1974. The bank did not appeal and complied by paying holiday pay up to January 1976. Subsequently, Presidential Decree No. 850 amended the Labor Code, and implementing rules were issued, including a provision that employees uniformly paid by the month with a salary not less than the minimum wage are presumed paid for all holidays. Based on this new rule and a related Policy Instruction, the bank stopped further holiday payments.
The union then filed a motion for execution to enforce the Arbiter’s 1975 decision. The bank opposed, arguing the new law and rules extinguished its obligation. The National Labor Relations Commission initially granted execution but was reversed on appeal by the Deputy Minister of Labor, who dismissed the union’s complaint, setting aside the final and executed judgment of the Labor Arbiter.

ISSUE

Whether the Deputy Minister of Labor committed grave abuse of discretion in setting aside the final and partially executed judgment of the Labor Arbiter based on subsequently issued rules and a new law.

RULING

Yes. The Supreme Court granted the petition, setting aside the Deputy Minister’s order and reinstating the Labor Arbiter’s decision. The legal logic is anchored on the doctrine of immutability of final judgments and the constitutional guarantee of due process. A decision that has attained finality, especially one that has been partially executed, becomes immutable and unalterable. It vests a right in the prevailing party that cannot be arbitrarily taken away. The subsequent promulgation of PD 850 and its implementing rules cannot retroactively nullify a final judgment. To hold otherwise would sanction a deprivation of property without due process of law. The Deputy Minister’s act of dismissing the complaint based on new rules, thereby divesting the employees of rights conclusively settled by a final judgment, constituted a grave abuse of discretion tantamount to lack or excess of jurisdiction. The Court emphasized that the demands of substantial justice and the constitutional right to due process require that final judgments be respected and protected from being disturbed by subsequent executive or legislative acts.