G.R. No. L-77859 May 25, 1988
CENTURY TEXTILE MILLS, INC. and ALFREDO T. ESCAÑO, petitioners, vs. NATIONAL LABOR RELATIONS COMMISSION, HON. LABOR ARBITER FELIPE P. PATI, and EDUARDO CALANGI, respondents.

FACTS

Private respondent Eduardo Calangi was an employee of petitioner Century Textile Mills, Inc. On June 4, 1983, a co-worker, Rodolfo Marin, reported seeing another employee, “Gatchie” Torrena, mixing a substance into a water pitcher used by supervisors Melchor Meliton and Antonio Santos. Laboratory analysis confirmed the presence of toxic formaldehyde. In a subsequent police investigation, Torrena confessed that Calangi masterminded the act as revenge for prior work suspensions. Based on this, petitioners placed Calangi under preventive suspension on June 10, 1983, and terminated his employment on July 27, 1983. Criminal charges for attempted murder were also filed.
Calangi filed a complaint for illegal dismissal, alleging he was not furnished a copy of the charges nor given an opportunity to answer them prior to his suspension and dismissal. The Labor Arbiter dismissed his complaint, finding the evidence overwhelming. On appeal, the National Labor Relations Commission (NLRC) reversed the decision, declaring the dismissal illegal and ordering reinstatement with full backwages. Petitioners filed this certiorari petition.

ISSUE

The primary issues are: (1) Whether Calangi was illegally dismissed; and (2) If so, whether the NLRC correctly awarded reinstatement with full backwages despite Calangi’s prayer being primarily for monetary damages.

RULING

The Supreme Court sustained the NLRC’s finding of illegal dismissal. The Court emphasized the twin requirements of substantive and procedural due process in termination cases. Substantively, while the act attributed to Calangi (masterminding an attempt to poison supervisors) constituted serious misconduct warranting dismissal, the employer failed to establish procedural due process. The Court agreed with the NLRC that Calangi was not afforded the opportunity to be heard and to defend himself prior to his preventive suspension and subsequent termination. The memorandum presented by petitioners as proof of notice was issued on the same date as the preventive suspension, indicating a lack of prior hearing. Failure to comply with procedural due process renders the dismissal illegal, even if a valid cause might exist.
Regarding the proper relief, the Court held that an illegally dismissed employee is entitled to reinstatement and backwages as a matter of right. The fact that Calangi’s complaint primarily sought monetary damages did not preclude the award of reinstatement, as the relief granted is based on the facts alleged and proved. However, the Court modified the NLRC’s order. Considering the gravity of the accusations which created severe animosity, compelling reinstatement was deemed not conducive to a harmonious work environment. In lieu of reinstatement, the Court awarded separation pay equivalent to one-half month’s salary for every year of service, computed from his hiring in 1974 until three years after his illegal dismissal in 1983. The award of backwages was limited to three years without qualification or deduction. The petition was dismissed with these modifications.