G.R. No. 156208 . November 21, 2017.
NPC DRIVERS AND MECHANICS ASSOCIATION (NPC DAMA), ET AL., Petitioners, vs. THE NATIONAL POWER CORPORATION (NPC), ET AL., Respondents.

FACTS

The Electric Power Industry Reform Act (EPIRA) mandated the privatization and restructuring of the National Power Corporation (NPC). Pursuant to this, the National Power Board (NPB) issued Resolutions 2002-124 and 2002-125, directing the termination of all NPC employees effective January 31, 2003. The Supreme Court, in its September 26, 2006 Decision, declared these resolutions void, as they were passed by only three out of nine statutory board members, with four other signatories being mere representatives without voting rights. The Court subsequently clarified that the termination was illegal, but reinstatement was impossible due to the accomplished reorganization. Thus, affected employees were entitled to back wages and separation pay based on a validly approved program, minus any benefits already received under the void resolutions. The NPB later issued Resolution No. 2007-55, purporting to ratify the principles of the earlier void resolutions.

ISSUE

The core issue for resolution in this motion was the proper computation and enforcement of the monetary awards due to the illegally dismissed NPC employees, specifically concerning the applicable separation pay formula, the validity of NPB Resolution No. 2007-55, and the liability of the Power Sector Assets and Liabilities Management Corporation (PSALM).

RULING

The Court denied the motions for reconsideration and affirmed its prior directives. It held that NPB Resolution No. 2007-55 could not retroactively validate the illegal dismissal of January 31, 2003, as the Court’s 2006 Decision had already attained finality, declaring the termination illegal. The separation pay must be computed based on the formula under a validly approved separation program. Since no such valid program existed at the time of illegal dismissal, the Court applied the formula from the subsequently issued but prospectively applied NPB Resolution No. 2007-55, as the most equitable and proximate guideline, granting one and a quarter month’s pay for every year of service. The award of back wages and allowances was upheld, to be computed from January 31, 2003, until the finality of judgment on October 10, 2008. PSALM, as a separate corporate entity created to manage NPC’s assets and liabilities, was not solidarily liable with NPC for the payment of these awards; the primary obligation remained with NPC. The charging lien for attorney’s fees in favor of petitioners’ counsel was affirmed at ten percent of the net monetary award. The Court remanded the case to the Regional Trial Court of Quezon City for the proper reception of evidence and computation of the exact amounts due to each individual petitioner-employee.