G.R. No. 183390 ; February 16, 2011
PLASTIMER INDUSTRIAL CORPORATION and TEO KEE BIN, Petitioners, vs. NATALIA C. GOPO, KLEENIA R. VELEZ, FILEDELFA T. AMPARADO, MIGNON H. JOSEPH, AMELIA L. CANDA, MARISSA D. LABUNOS, MELANIE T. CAYABYAB, MA. CORAZON DELA CRUZ, and LUZVIMINDA CABASA, Respondents.

FACTS

On 7 May 2004, Plastimer Industrial Corporation informed its employees of a decision to downsize and reorganize due to a withdrawal of investments and a change in corporate structure. On 14 May 2004, the respondents, along with other employees, were served written notices of termination effective 13 June 2004. On 24 May 2004, Plastimer and the union (PICCB) entered into a Memorandum of Agreement (MOA) governing the retrenchment terms. On 26 May 2004, Plastimer submitted an Establishment Termination Report to the DOLE. On 28 May 2004, the affected employees, including respondents, signed individual “Release Waiver and Quitclaim” documents. Subsequently, respondents filed a complaint for illegal dismissal, alleging they were required to sign the waivers without understanding them and that Plastimer failed to establish valid causes for retrenchment and to comply with the one-month notice to DOLE. The Labor Arbiter and the NLRC upheld the validity of the retrenchment, finding that the company proved a substantial withdrawal of stocks, that notices were given to employees 30 days prior, and that respondents were assisted by the union president and counsel when signing the waivers. The Court of Appeals reversed the NLRC, ruling there was no valid cause for retrenchment, that Plastimer failed to use fair criteria for selection, and that the union president and counsel were not present during the signing of the waivers, thereby declaring the dismissal illegal and ordering reinstatement with backwages.

ISSUE

Whether respondents were illegally retrenched by petitioners.

RULING

The Supreme Court ruled that the retrenchment was valid. It set aside the decision of the Court of Appeals and reinstated the decisions of the Labor Arbiter and NLRC, with modification. The Court held that: (1) The findings of fact of the Labor Arbiter and NLRC, which found a valid cause for retrenchment due to a substantial withdrawal of stocks and corporate restructuring, were more in accord with the evidence than those of the Court of Appeals; (2) While notice to the DOLE was short of the one-month requirement, notice to the employees was given 30 days prior, and such procedural infirmity does not render the retrenchment illegal but warrants the payment of nominal damages; (3) The MOA between the company and the union, which provided for separation pay, indicated that the retrenchment was necessary and that the criteria for selection were discussed and understood by the union; and (4) The waivers and quitclaims signed by respondents were valid, as they were assisted by the union president and counsel, and the consideration they received was beyond what the law required. The Court ordered petitioners to pay each respondent P30,000 as nominal damages for non-compliance with statutory due process regarding the notice to DOLE.