G.R. No. 99054 -56 May 28, 1993
ERLINDA O. MEDINA, LOUELLA MARIE E. ANDRADA, NELMIE C. MANUEL, TEOFILO MAQUI, JR., ELPIDIO R. HIPOL, RICHARD CALDITO, NARCISO BANOEY, EDGARDO MALLARE, ELLIOT MALAGGAY and JOSEPH SOMERA, herein represented by DZWX WORKERS’ UNION-ALU (TUCP), petitioners, vs. CONSOLIDATED BROADCASTING SYSTEM (CBS) — DZWX, ANDRES S. TAMAYO and, NATIONAL LABOR RELATIONS COMMISSION, respondents.

FACTS

Petitioners, rank-and-file employees of Station DZWX operated by respondent Consolidated Broadcasting System, were illegally dismissed on August 31, 1984. On May 8, 1988, Labor Arbiter Iremarco Rimando declared the dismissals illegal and ordered reinstatement with backwages, limited to three years. The NLRC, in a Resolution dated October 4, 1989, affirmed this, declaring respondents guilty of unfair labor practice. Petitioners received backwages for three years in 1990 but were not reinstated. Instead of reinstating them, respondents offered assignments in Davao or Cebu. A Writ of Execution was issued on August 3, 1990, ordering reinstatement but denying additional backwages beyond the three years already paid. Petitioners appealed, claiming entitlement to salaries under Article 223 of the Labor Code, as amended by Republic Act No. 6715 , from the effectivity of the law on March 21, 1989, until actual reinstatement, due to respondents’ refusal to reinstate. The NLRC dismissed the appeal on April 15, 1991, ruling that Article 223 did not apply as the case was decided before RA 6715 took effect. Petitioners filed this certiorari petition.

ISSUE

Whether the refusal of the employer to reinstate illegally dismissed employees, despite an executory order, makes it liable to pay their salaries pursuant to Article 223 of the Labor Code, as amended by Republic Act No. 6715 .

RULING

Yes. The Supreme Court granted the petition. It held that under Article 223 of the Labor Code, as amended, an employer has two options to comply with an immediately executory order of reinstatement pending appeal: (1) admit the employee back to work under the same terms, or (2) reinstate the employee merely in the payroll. Failure to exercise either option makes the employer liable to pay the employee’s salary from the date it failed to reinstate despite service of an executory writ. This interpretation aligns with constitutional labor protection and Article 279, which awards full backwages until actual reinstatement. The Court found respondents acted in bad faith by offering distant assignments and not complying with the writ. Consequently, equity demanded an award of additional backwages equivalent to three years without qualification, distinct from the three years already paid for illegal dismissal. This additional award indemnifies petitioners for income lost due to the unjustified failure to reinstate. The Court also ordered immediate reinstatement and noted that a subsequent agreement for separation pay did not bar petitioners’ claims, as it was not approved by the Labor Arbiter and appeared aimed at withdrawing criminal complaints.