GR 154689; (November, 2004) (Digest)
G.R. No. 154689 , November 25, 2004
Unicorn Safety Glass, Inc., Lily Yulo and Hilario Yulo, petitioners, vs. Rodrigo Basarte, et al., respondents.
FACTS
Respondents were regular employees and union officers of petitioner Unicorn Safety Glass, Inc. On March 2, 1998, the company, citing economic difficulties such as decreased sales and increased production costs, informed respondents that their workdays would be reduced effective April 13, 1998. The respondents protested, suspecting the move was an act of union busting since only union officers were targeted. On April 6, 1998, the company issued a final memorandum implementing a work rotation scheme, reducing workdays to three per week. Despite a meeting where management asserted its prerogative, respondents filed a complaint for constructive dismissal and unfair labor practice on April 13, 1998, instead of reporting for work under the new schedule.
The company sent telegrams directing respondents to return to work, but they refused, citing the hostile work environment. The Labor Arbiter dismissed the complaint, finding no constructive dismissal as the company had repeatedly ordered them to return, and their refusal to work was unjustified. The National Labor Relations Commission (NLRC) affirmed this decision. The Court of Appeals, however, reversed the NLRC and Labor Arbiter.
ISSUE
Whether the unilateral reduction of workdays constitutes constructive dismissal.
RULING
Yes, the unilateral imposition of a reduced workweek constituted constructive dismissal. The Supreme Court affirmed the Court of Appeals, holding that the reduction of workdays from six to three per week amounted to a demotion in rank and a diminution of pay and benefits. Such a unilateral act by the employer, without the employees’ consent, is tantamount to constructive dismissal, as it renders continued employment unreasonable, unlikely, or impossible. The Court emphasized that management prerogative is not absolute and must be exercised in good faith and without detriment to the employees’ rights. The company’s claim of economic hardship was not sufficiently proven, and the selective application of the policy only to union officers indicated bad faith and union animus, supporting the finding of unfair labor practice. Consequently, respondents were entitled to reinstatement with full backwages.