G.R. No. 96739 October 13, 1993
DEPARTMENT OF TRADE AND INDUSTRY, petitioner, vs. THE CHAIRMAN AND COMMISSIONERS OF THE CIVIL SERVICE COMMISSION, ET AL., respondents.

FACTS

Pursuant to Executive Order No. 133 dated February 27, 1987, which reorganized the Department of Trade and Industry (DTI) and attached agencies, the National Cottage Industry Development Authority (NACIDA) was reorganized into the Cottage Industry Technology Center (CITC). DTI Memorandum Circular No. 28, pre-cleared with the Civil Service Commission (CSC), provided guidelines for personnel evaluation and placement. Private respondent Taciana B. Espejo, then a Division Chief II in NACIDA, was evaluated by the DTI Reorganization Committee and found not sufficiently qualified for retention. She received a termination letter dated August 17, 1988, with separation effective September 16, 1988. On August 19, 1988, she was offered the position of Industrial Development Specialist in CITC, which was four salary ranges lower than her former position. She declined the offer and appealed to the DTI Reorganization Appeals Board (DTI-RAB), which affirmed the termination. Espejo then appealed to the CSC. The CSC, in its resolution dated April 10, 1990, reversed the DTI-RAB and ordered Espejo’s reinstatement to a position comparable to her former Division Chief II position. The DTI’s motion for reconsideration was denied. The DTI later offered Espejo a Division Chief I position (RR-22), which she rejected as not comparable. The CSC, in an order dated September 28, 1990, clarified that a comparable position must be Division Chief with Range 24, and in a subsequent order dated February 5, 1991, directed her reinstatement to specific Division Chief positions in the Bureau of Export Trade Promotion. The DTI filed this petition, contending it cannot be compelled to appoint Espejo to a Division Chief (Range 24) position as there are more senior and qualified employees, and the functions require different expertise.

ISSUE

Whether the Civil Service Commission committed grave abuse of discretion in ordering the reinstatement of Taciana B. Espejo to a position comparable to her former Division Chief II (Range 24) in the DTI, despite the DTI’s claim that the reorganization was done in good faith and that more qualified employees exist for the vacant positions.

RULING

The Supreme Court DISMISSED the petition and AFFIRMED the resolution of the Civil Service Commission. The Court held that the reorganization must be implemented in good faith and pass the test of good faith as laid down in Dario v. Mison. The CSC’s findings, which are accorded respect and finality absent grave abuse of discretion, established that the reorganization as it affected Espejo was not done in good faith. The CSC found evidence of bad faith under Republic Act No. 6656 , specifically: (a) a significant increase in the number of positions in the new DTI staffing pattern; (b) NACIDA’s functions were merely transferred to other DTI units, not abolished; and (c) incumbents were replaced by those less qualified in terms of education, performance, and merit, as in Espejo’s case where she, a Division Chief for 11 years with a Master’s degree, was offered a position four ranks lower while less qualified personnel were promoted. The Court found no grave abuse of discretion in the CSC’s resolution ordering her reinstatement to a comparable position.
Separate Opinions:
Chief Justice Narvasa and Justice Feliciano dissented, citing the reasons set out in Justice Herrera’s dissenting opinion in Dario v. Mison.