Garcia v. NLRC

Facts:

Petitioners were employees of NASECO, a government-owned or controlled corporation engaged in providing manpower services such as security guards, radio operators, janitors and clerks, principally for the Philippine National Bank. They were either members of the NASECO Employees Union (NASECO-EU) or of the Alliance of Concerned Workers of NASECO (ACW-NASECO). They were among those who staged a strike and picketed the premises of the PNB.

the PNB filed a complaint for damages with preliminary injunction against the labor unions with the Regional Trial Court of Manila.

NASECO also filed a petition with the NLRC to declare the strike illegal. The union officers who knowingly and actively participated in the strike, as well as the members of the respondent union who committed illegal acts in the course of the strike, were deemed to have legally lost their employment status. The rest of the striking members, including the herein fifty-one petitioners, were ordered to report for work immediately.

The complaint of the labor union against the PNB for unfair labor practice and illegal lockout was dismissed on the ground that there was no employer-employee relationship between the PNB and the labor unions.

The petitioners reported for work at the NASECO office but they could not be given assignments because the PNB had meanwhile contracted with another company to fill the positions formerly held by the petitioners.

NASECO inquired from the PNB whether or not the petitioners could still be accepted to their former positions in light of the Service Agreement between NASECO and the PNB giving the latter the right to reject or replace any and all of NASECO's employees assigned to it, for inefficiency or other valid reasons. NASECO then sought new assignments for the petitioners with its other clients, but the petitioners insisted on their reassignment to the PNB. In the meantime, NASECO paid the salaries and other benefits of the petitioners although they were not actually working.

The petitioners received notice of separation from NASECO, effective thirty days thereafter. The reason given was the financial losses NASECO was incurring at that time due mainly to the salaries being paid to the employees who could not be posted despite efforts to place them. NASECO even offered a better separation package equivalent to three-fourths of the estimated new basic monthly salary for every year of service, compared to the statutory requirement of only 1/2 month pay for every year of service.

The petitioners refused to acknowledge receipt of the notice and instead filed with NLRC a complaint against NASECO for unfair labor practice, illegal dismissal, non-payment of wages and damages.

Labor Arbiter rendered a decision finding that the petitioners had been "fairly discharged by the respondent (NASECO) in a valid act of simple retrenchment."

Petitioners filed an appeal. they filed a manifestation that the private respondent had been hiring new personnel, but no proof was offered to support the charge.

NLRC issued a resolution affirming the decision of LA. MR was filed but was denied.

Issues:

1. Whether or not NLRC gravely abused its discretion in holding that the petitioners were validly dismissed on the ground of retrenchment; that NASECO is not guilty of unfair labor practice. – No.

The losses incurred by NASECO for the year 1989 amounted to P1,457,700.42 and were adequately proved by it. These losses were directly caused by the salaries and other benefits paid to the petitioners. The amount of these payments is not insubstantial in light of the economic difficulties of the country during that year when several coups d' etat adversely affected the nation's economic growth.

It is also not true that respondent NASECO did not look for other measures to cut back on its losses. NASECO had in fact tried to place the petitioners with its other clients but it was the petitioners themselves who refused reassignment.

The particular facts of this case preclude application of the "first in, last out" rule in the retrenchment of employees. There was no discrimination against the petitioners. NASECO could not compel the PNB to take the petitioners back to their former positions in view of its contractual right to reject any employee of NASECO for inefficiency and other valid reasons. The PNB had already filled the vacated positions of the petitioners during the strike, to ensure the continued operation of its business.

2. Whether or not their monetary claims for increases under Republic Acts 6640 and 6727. – Yes

The increases in the petitioners' minimum wage under RA 6640 and RA 6720 should be granted since they became effective before the petitioners' retrenchment. Said increases should be considered in the computation of their separation pay in accordance with Art. 283 of the Labor Code.

3. Whether or not moral and exemplary damages and attorney's fees should be denied. – Yes and No

Moral damages are recoverable only where the dismissal of the employee was attended by bad faith or fraud or constituted an act oppressive to labor or was done in a manner contrary to morals, good customs or public policy.12Exemplary damages may be awarded only if the dismissal was effected in a wanton, oppressive or malevolent manner. 13 None of these grounds has been proven. However, the Court will grant the claim for attorney's fees in an amount equivalent to 10% of the total amount awarded to the petitioner as authorized by the Labor Code.

Held:

The constitutional policy of providing full protection to labor is not intended to oppress or destroy management. The employer cannot be compelled to retain employees it no longer needs, to be paid for work unreasonably refused and not actually performed. NASECO bent over backward and exerted every effort to help the petitioners look for other work, postponed the effective date of their separation, and offered them a generous termination pay package. The unflagging commitment of this Court to the cause of labor will not prevent us from sustaining the employer when it is in the right, as in this case.