GR 119842; (August, 1996) (Digest)
G.R. No. 119842 August 30, 1996
VENANCIO GUERRERO, ET AL., petitioners, vs. NATIONAL LABOR RELATIONS COMMISSION, R.O.H. AUTO PRODUCTS PHILS., INC. and GOEFF KEMP, respondents.
FACTS
The petitioners were non-striking employees of respondent R.O.H. Auto Products Phils., Inc. During a union strike in March 1992 that allegedly paralyzed operations, the company proposed “financial assistance” to non-strikers in exchange for their resignation, with an assurance of rehiring priority. On April 24, 1992, petitioners accepted the offer, signed quitclaim deeds, and received separation pay. After the strike ended on May 3, 1992, all striking employees were reinstated. Petitioners sought to return to their former positions, but the company refused. They subsequently filed complaints for illegal dismissal. The Labor Arbiter and the NLRC dismissed their complaints, prompting this petition for certiorari.
ISSUE
Whether the petitioners were illegally dismissed.
RULING
Yes, the Supreme Court ruled that the petitioners were illegally dismissed. The respondent company failed to satisfy the legal requisites for a valid retrenchment under Article 283 of the Labor Code. First, the company did not present sufficient and convincing evidence to prove serious, actual, and real financial losses necessitating retrenchment. Mere allegations of losses from the strike, without competent proof, are insufficient. Second, the company did not demonstrate that retrenchment was a necessary last resort, as there was no showing it had exhausted other less drastic measures to abate losses. Third, the mandatory procedural requirements were not followed; the company failed to serve written notices to both the employees and the Department of Labor and Employment at least one month prior to the intended retrenchment. Payment of one month’s salary in lieu of notice does not constitute compliance. Finally, the petitioners’ acceptance of financial assistance and execution of quitclaims do not estop them from questioning the dismissal’s legality, as they were constrained by the belief the company would cease operations. The NLRC decision was reversed and set aside. Respondents were ordered to reinstate petitioners without loss of seniority rights and with full backwages, minus the financial assistance received.