G.R. No. 195227 , April 21, 2014
FROILAN M. BERGONIO, JR., DEAN G. PELAEZ, CRISANTO O. GEONGO, WARLITO O. JANAYA, SALVADOR VILLAR, JR., RONALDO CAFIRMA, RANDY LUCAR, ALBERTO ALBUERA, DENNIS NOPUENTE and ALLAN SALVACION, Petitioners, vs. SOUTH EAST ASIAN AIRLINES and IRENE DORNIER, Respondents.

FACTS

Petitioners filed a complaint for illegal dismissal against respondents. On May 31, 2005, the Labor Arbiter (LA) found petitioners illegally dismissed and ordered their immediate reinstatement with full backwages. The respondents received the decision on July 8, 2005. On August 20, 2005, petitioners filed a Motion for Issuance of Writ of Execution for immediate reinstatement. During a pre-execution conference on September 14, 2005, respondents manifested their option to reinstate petitioners in the payroll, but this did not materialize. The LA issued a writ of execution on October 7, 2005, which was returned unsatisfied. An alias writ of execution was issued on February 16, 2006. On February 21, 2006, respondents issued a Memorandum directing petitioners to report for work on February 24, 2006. Petitioners failed to report. Meanwhile, respondents appealed the LA’s illegal dismissal ruling to the NLRC, which dismissed the appeal for non-perfection on August 15, 2006. An Entry of Judgment was issued on February 6, 2007. The LA issued another writ of execution on April 24, 2007, and a Notice of Garnishment for ₱1,900,000 was issued on June 6, 2007. On December 18, 2007, the Court of Appeals (CA) rendered a decision declaring petitioners’ dismissal valid, awarding only nominal damages. This CA decision was eventually affirmed by the Supreme Court. On January 31, 2008, petitioners filed an Urgent Ex-Parte Motion for Immediate Release of the Garnished Amount. The LA granted the motion on March 13, 2008, directing the release of the garnished amount, finding petitioners’ claim for accrued wages valid due to respondents’ refusal to reinstate them despite the final and executory reinstatement order. The NLRC affirmed the LA’s order on July 16, 2008. Respondents assailed the NLRC decision via a petition for certiorari with the CA. The CA granted the respondents’ petition, reversing the NLRC and ruling that the computation of petitioners’ accrued wages should only be until February 24, 2006 (the date they were directed to report for work), because the delay in enforcing reinstatement was due to petitioners’ failure to report for work and not due to respondents’ unjustified act.

ISSUE

Whether the Court of Appeals erred in ruling that the computation of petitioners’ accrued wages, pursuant to the immediately executory reinstatement order, stopped on February 24, 2006, due to their failure to report for work per the respondents’ Memorandum.

RULING

Yes. The Supreme Court granted the petition and reversed the Court of Appeals’ decision. The Court held that the reinstatement aspect of a Labor Arbiter’s decision finding illegal dismissal is immediately executory, and the employer is obliged to reinstate and pay the wages of the dismissed employee during the period of appeal until the decision is reversed by a higher tribunal. If the employer fails to reinstate, the employee’s right to accrued wages continues. The Court found that respondents failed to exercise the options for reinstatement (actual or payroll) in good faith. Their actions—including filing pleadings opposing reinstatement on the ground of strained relationship, issuing the return-to-work Memorandum only after the alias writ of execution, and directing petitioners to report to a different location (Clark Field) for a “re-orientation”—constituted unjustified acts that prevented the execution of the reinstatement order. The petitioners’ failure to report for work on February 24, 2006, was justified given the respondents’ demonstrated lack of sincere intention to reinstate them and the altered terms of reinstatement. Therefore, the delay in reinstatement was attributable to the respondents. Consequently, petitioners were entitled to accrued wages computed from the time of their illegal dismissal until the finality of the CA’s decision reversing the illegal dismissal finding on December 18, 2007. The case was remanded to the NLRC for proper computation.