G.R. No. 125028 February 9, 1998
REYNALDO VALDEZ, petitioner, vs. NATIONAL LABOR RELATIONS COMMISSION and NELBUSCO, INC., respondents.

FACTS

Petitioner Reynaldo Valdez was hired by private respondent Nelbusco, Inc. in December 1986 as a bus driver on a commission basis. On February 28, 1993, the airconditioning unit of the bus he was driving broke down. The respondent company told him to wait until it was repaired and did not assign him another bus. Petitioner continued reporting for work but found the bus was not repaired. Several months later, he discovered the bus was plying its route as an ordinary bus with a newly-hired driver. Petitioner filed a complaint for illegal dismissal on June 15, 1993, claiming the company refused to let him drive again because he would not sign an undated resignation letter and a blank quitclaim. The company alleged petitioner voluntarily resigned to supervise his house construction after the breakdown, which was due to his fault, and that he failed to secure management clearance. The Labor Arbiter ruled in favor of Valdez, declaring illegal dismissal and awarding backwages, separation pay, and a refund of his cash bond and tire deposit. The NLRC reversed this, deleting the award of backwages and ordering reinstatement without backwages or separation pay if reinstatement was not possible. Petitioner’s motion for reconsideration was denied.

ISSUE

Whether or not petitioner was illegally dismissed and entitled to back wages and separation pay.

RULING

Yes. The Supreme Court granted the petition, set aside the NLRC decision, and reinstated the Labor Arbiter’s decision. The Court ruled that petitioner was constructively dismissed. Applying Article 286 of the Labor Code by analogy, the Court held that placing an employee on a “floating status” for more than six months due to causes imputable to the employer constitutes illegal dismissal. The breakdown of the airconditioning unit was a valid reason for a temporary stoppage, but the six-month period was more than reasonable for its repair. The company’s failure to provide a substitute vehicle beyond this period, its attempt to force petitioner to sign a resignation and quitclaim, and its admission that the bus was still unrepaired over a year later, all indicated constructive dismissal. The allegation of voluntary resignation was deemed illogical and inconsistent with filing an illegal dismissal complaint. The employer failed to prove just cause for dismissal. Under Article 279, an illegally dismissed employee is entitled to reinstatement without loss of seniority rights and full backwages. Consequently, the Labor Arbiter’s award of backwages, separation pay in lieu of reinstatement, and refund of cash bond and tire deposit was reinstated.