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PAL vs PALEA, 19 SCRA 483 Employees who ceased to work but are still deemed employees FACTS: Appeal

by certiorari , by PAL from an order of the CIR (Court of Industrial Relations) the dispositive part of reads: WHEREFORE , THE Philippine Air Lines is hereby ordered to pay the four claimants, Messrs. Fortuno Biangco, Hernando Guevarra, Bernardino Abarrientos and 140 days each, sick leave which the two may use or enjoy according to existing company rules, and regulations regarding this privilege, and to allow the four claimants the enjoyment of their earned and accumulated free trip passes both here and aboard subject to the above-mentioned plan the company may adopt. In order to effect early payment of the Christmas bonus, the Chief Examiner of the Court or his duly authorized representatives is hereby directed to examine; pertinent records of the company, to compute and determine the Christmas bonus due each of the four claimant and to submit a report therefore immediately upon completion of the same. On May 4, 1950, PAL dismissed its above named four (4) employees, who are members of PALEA. On July 13, 1954, the CIR en banc passed a resolution, directing the reinstatement of said employess "to their former or equivalent position in the company, with back wages from the date of their reinstatement, and without prejudice to their seniority or other rights and privileges. This was affirmed by the SC. Said employees were reinstated and subsequently their backwages, computed at the rate of their compensation at the time of the aforementioned dismissal, less the wages and salaries earned by them elsewhere during the lay-off period, were paid to them. PALEA moved for the execution of the CIR resolution of July 13, 1954, as regards the "other rights and privileges" therein mentioned, referring, more specifically to: (1) Christmas bonus from 1950 to 1958; (2) accumulated sick leave; (3) transportation allowance during lay-off period; and (4) accumulated free trip passes, both domestic and international. By an order dated October 8, 1962, the CIR granted this motion, except as regards the sick leave of Onofre Griño and Bernardino Abarrientos, and the transportation allowance, which were denied. PAL maintains that the CIR has erred in acting as it did, because : (1) the aforementioned privileges were not specifically mentioned in the CIR resolution of July 13, 1954; (2) the order of the CIR dated October 8, 1962, had, allegedly, the effect of amending said resolution; and (3) the clause therein "without prejudice to their seniority or other rights and privileges" should be construed prospectively, not retroactively.

ISSUE:

are not entitled to said privileges. NO. has become part of the compensation of the employees. and (2) that. well taken. The PAL's appeal as regards the free trip passes is. entitled to transportation allowance and the corresponding sick leave privileges. for said bonus. except as to the free trip passes for the lay-off period. the appealed resolution of October 8. the employees were to be treated in matters involving seniority and continuity of employment as though they had not been absent from work. neither automatically. Republic of the Philippines SUPREME COURT . HELD: 1. Onofre Griño and Bernardino Abarrientos. Said employees are. without pronouncement as to costs. WON PAL’s contentions are meritorious. As a consequence. 1954. The employees had to apply therefore and their applications were subject PAL's approval. 1962. however. Citing Republic Steel Corporation vs. is hereby affirmed in all other respects. and hence the reinstated employees are entitled to the benefits of the employer's vacation plan for the year in which they were reinstated and subsequent years upon the basis of continuity of service computed as though they had been actually at during the entire period from the date of strike to the date of reinstatement. effective in 1959. the employees involved in the case at bar are entitled to the Christmas bonus that PAL had given to all of its employees during said period. likewise. namely: (1) that the accumulated sick leave cannot exceed 140 days. to the following qualifications. pursuant to the collective bargaining agreement between the PAL and the PALEA. who have retired. for the employees had no absolute right thereto. It is so ordered. nor indiscriminately.1. which should not be deemed included in the "rights and privileges" awarded in the resolution of July 13. These sick leave privileges are subject. RULING: Wherefore. which denies sick leave privileges to retired employees. NLRB the court held: To reinstate the striking employees without prejudice to their seniority or other rights or privileges means that upon reinstatement. pursuant to the same agreement. having been paid regularly. The free trip passes were given. however. even if they had actually rendered services during the lay-off period. and subject to the qualification that the accumulated sick leave privileges cannot exceed 140 days.

In order to effect early payment of the Christmas bonus.Manila EN BANC G.J. Inc. Lerum & Cinco and Beltran & Lacson for respondents. Bernardino Abarrientos and 140 days each. Fortuno Biangco. Tuason for respondent Court of Industrial Relations.: Appeal by certiorari . 1967 PHILIPPINE AIR LINES. respondents. and regulations regarding this privilege. to compute and determine the Christmas bonus due each of the four claimant and to submit a report therefore immediately upon completion of the same. Hernando Guevarra. CONCEPCION. Poblador. THE Philippine Air Lines is hereby ordered to pay the four claimants. pertinent records of the company. Messrs. vs. sick leave which the two may use or enjoy according to existing company rules. the Chief Examiner of the Court or his duly authorized representatives is hereby directed to examine. Tañada.. taken by the Philippine Air Lines. C. L-21120 February 28.R. — hereinafter referred to as the PAL from an order of the Court of Industrial Relations — hereinafter referred to as the CIR — the dispositive part of reads: WHEREFORE . and to allow the four claimants the enjoyment of their earned and accumulated free trip passes both here and aboard subject to the above-mentioned plan the company may adopt. Mariano B. petitioner. INC. Cruz & Nazareno for petitioner. Paredes. No. PHILIPPINE AIR LINES EMPLOYEES ASSOCIATION and COURT OF INDUSTRIAL RELATIONS. .

computed at the rate of their compensation at the time of the aforementioned dismissal. (2) the order of the CIR dated October 8. The aforementioned clause must be considered in the light of the entire context of the resolution of July 13. the PAL's contention is clearly devoid of merit. allegedly. 1958. or on November 10. (2) accumulated sick leave. in G. had. 1960." it is obvious that the resolution intended to restore the employees to their status immediately prior to their dismissal. and without prejudice to their seniority or other rights and privileges. said employees were reinstated and subsequently their backwages. the CIR granted this motion. 1960. No. the PALEA moved for the execution of the CIR resolution of July 13. 1959. and the transportation allowance. with back wages from the date of their reinstatement. not only their reinstatement. except as regards the sick leave of Onofre Griño and Bernardino Abarrientos. as regards the "other rights and privileges" therein mentioned. more specifically to: (1) Christmas bonus from 1950 to 1958. 1954 and of its dispositive part.R. This resolution was affirmed by the Supreme Court. in G. and (4) accumulated free trip passes. not retroactively. which were denied. and without prejudice to their seniority or other rights and privileges. in a Resolution dated May 22. L-8197. Insofar as the Christmas bonus. the effect of amending said resolution. 1954. 1954. the payment of their back wages during the period of their lay-off — thus referring necessarily to a period of time preceding their reinstatement — . it directed . No. both domestic and international. 1954. who are member of the Philippine Air Lines Employees Association — hereinafter referred to as PALEA — and that on July 13. referring. 1950. On January 14. 1960. on October 31. the accumulated sick leave privileges and the transportation allowance during the lay-off period. PAL maintains that the CIR has erred in acting as it did. directing the reinstatement of said employess "to their former or equivalent position in the company. By an order dated October 8. in Case No. less the wages and salaries earned by them elsewhere during the lay-off period. Hence this appeal. because : (1) the aforementioned privileges were not specifically mentioned in the CIR resolution of July 13. PAL dismissed its above named four (4) employees. 1962. (3) transportation allowance during lay-off period.R. 1962. but. which was reversed by the Supreme Court.It appears that on May 4. the CIR en banc passed resolution. Hence. 465-V thereof. on July 26. The employees objected to this deduction and the CIR sustained them. Soon later. were paid to them. L-15544. also. In ordering therein the "reinstatement" of said employees with "back wages from the date of their dismissal to the date of their reinstatement. and (3) the clause therein "without prejudice to their seniority or other rights and privileges" should be construed prospectively.

coupled with "seniority or other rights and privileges". Wherefore. but at the time? Certainly. the reinstatement was with back wages for the lay-off period.1 Said employees are. . Rights reinstatement. and subject to the qualification that the accumulated sick leave privileges cannot exceed 140 days. pursuant to the same agreement.1äwphï1. but at the time of their aforementioned dismissal. attached to the status of the employees when they were dismissed. it was held that. neither automatically. has become part of the compensation of the employees. Onofre Griño and Bernardino Abarrientos. are not entitled to said privileges.ñët Thus. nor indiscriminately. well taken. even if they had actually rendered services during the lay-off period. however. The free trip passes were given. NLRB (114 F. effective in 1959. in Republic Steel Corporation vs. for the employees had no absolute right thereto. The PAL's appeal as regards the free trip passes is. for said bonus. and (2) that. 1954. To put it differently. is hereby affirmed in all other respects. however. it was the intention of the Board and Court to provide that. entitled to transportation allowance and the corresponding sick leave privileges. The employees had to apply therefore and their applications were subject PAL's approval. 1962. who have retired. the employees involved in the case at bar are entitled to the Christmas bonus that PAL had given to all of its employees during said period. These sick leave privileges are subject. upon reinstatement the employees were to be treated in matters involving seniority and continuity of employment as though they had not been absent from work.and the retention of "their seniority or other rights and privileges". and hence the reinstated employees were entitled to the benefits of the employer's vacation plan for the year in which they were reinstated and subsequent years upon the basis of continuity of service computed as though they had been actually at during the entire period from the date of strike to the date of reinstatement. the appealed resolution of October 8. likewise. not after their reinstatement. 820). to the following qualifications. without pronouncement as to costs. It is so ordered. the CIR treated said employees as if they had not been absent form work and had been uninterruptedly working during the lay-off period. under a decree of the Circuit Court of Appeals and Order of the National Labor Relations Board directing the employer to reinstate the striking employees without prejudice to their seniority or other rights or privileges. which denies sick leave privileges to retired employees. In other words. 2d. As a consequence. namely: (1) that the accumulated sick leave cannot exceed 140 days. which should not be deemed included in the "rights and privileges" awarded in the resolution of July 13. except as to the free trip passes for the lay-off period. pursuant to the collective bargaining agreement between the PAL and the PALEA. having been paid regularly.

. Makalintal. 1960. Dizon. 1959. Sanchez and Castro.. August 31. L-14922. The Lawphil Project . Bengzon. American Drug Co. J. Ansay vs.B.L. Footnotes 1Almonte vs. April 29. JJ.Arellano Law Foundation . Board of Directors. Regala. concur.Reyes. L-13667.