G.R. Nos. 83886-87 September 20, 1990
ASSOCIATED LABOR UNIONS (ALU), JOSE AJERO and ANTONIO AJERO, petitioners, vs. NATIONAL LABOR RELATIONS COMMISSION, J.B. ORCHIDS PHARMACEUTICALS, INC. and/or TOMAS B. SIAN JR. and LABOR ARBITER BONIFACIO B. TUMAMAK, respondents.

FACTS

Petitioners Antonio and Jose Ajero filed separate complaints for illegal dismissal and monetary claims against their employer, J.B. Orchids Pharmaceuticals, Inc. The cases were consolidated. Notices for preliminary conferences were sent and hearings were scheduled on several dates. The private respondents and their counsel failed to appear at most hearings, except on February 8, 1984, when their counsel entered his appearance. The minutes of that hearing indicated the next hearing date and required the filing of a position paper. Subsequent notices were received by the company’s security guard and the counsel’s secretary. The respondents failed to file any position paper or appear further.
Consequently, Labor Arbiter Vito Minoria rendered a decision in favor of the petitioners, awarding monetary claims, damages, and ordering reinstatement with backwages. The respondents filed a motion to set aside the decision, alleging denial of due process due to improper service of summons and lack of notice. The NLRC set aside the Labor Arbiter’s decision, finding a denial of due process, and remanded the case for further proceedings. The petitioners elevated the case to the Supreme Court via certiorari.

ISSUE

Whether the National Labor Relations Commission committed grave abuse of discretion in setting aside the Labor Arbiter’s decision on the ground that the private respondents were denied due process.

RULING

Yes, the NLRC committed grave abuse of discretion. The Supreme Court reinstated the Labor Arbiter’s decision, with modification regarding reinstatement. The legal logic is that due process in labor proceedings is satisfied by a fair and reasonable opportunity to be heard, not necessarily strict adherence to technical rules of notice. The records established that the private respondents were afforded this opportunity. Their counsel appeared at the February 8, 1984 hearing and was apprised of the subsequent schedule and the requirement to file a position paper. Notices for later hearings were also received at the company premises and the counsel’s office.
The respondents’ failure to participate was a voluntary waiver of their right to present evidence. The Labor Arbiter correctly proceeded to decide the case based on the evidence presented by the petitioners. The NLRC’s conclusion of a denial of due process was a capricious and whimsical exercise of judgment, constituting grave abuse of discretion. However, since the respondent corporation had ceased operations due to a fire, reinstatement was no longer feasible. The Court modified the award to grant separation pay and to compute backwages only up to the date the company stopped operations. The temporary restraining order was made permanent.