G.R. No. L-58011-12. July 20, 1982.

VIR-JEN SHIPPING AND MARINE SERVICES, INC., Petitioner, v. NATIONAL LABOR

RELATIONS COMMISSION, ROGELIO BISULA, RUBEN ARROZA, JUAN GACUTNO,
LEONILO ATOK, NILO CRUZ, ALVARO ANDRADA, NEMESIO ADUG, SIMPLICIO
BAUTISTA, ROMEO ACOSTA, and JOSE ENCABO, Respondents.

Maximo A. Savellano, Jr., for Petitioner.

Solicitor General and Romeo M. Devera for Respondents.
BARREDO, J.:
Brief Background:
The instant case revolves around a petition for certiorari seeking the annulment or setting aside,
on the grounds of excess of jurisdiction and grave abuse of discretion, the decision of the National
Labor Relations Commission in consolidated NSB Cases Nos. 2250-79 and 2252-79. Herein private
respondents have a manning contract for a period of one (1) year with petitioner in representation
of its principal Kyoei Tanker Co. Ltd. The terms and conditions of said contract were based on the
standard contract of the NSB. The manning contract was approved by the NSB.

When the vessel M/T Janu was enroute to Australia, the private respondents demanded to
petitioner, through cable communication vessel that they were not contented with the salary and
benefits stipulated in the manning contract, and demanded that they be given 50% increase thereof,
as the ‘best and only solution to solve ITF problem.’ Vir-jen Shipping countered their offer with
only 25% increase, considering the losses the petitioner were to suffer in the drastic increase
demanded by the seamen. The respondent seamen agreed but the principal Kyoei Tanker Co. Ltd.
terminated the manning contract for the unexpected and unreasonable demand for salary increase
of the officers and crew of M/T Janu.

Petitioner wrote the NSB asking permission to cancel the manning contract which was approved
by the latter. By reason thereof, the seamen were disembarked in Japan and repatriated to Manila,
and they then filed a complaint with the NSB for illegal dismissal and non-payment of wages.
However, the NSB found that the termination of the services of the seamen before the expiration
of their employment contract was justified ‘when they demanded and in fact received from the
company wages over and above the contracted rates which in effect was am alteration and
modification of a valid and existing contract.’ Respondent seamen appealed the decision to the
NLRC which reversed the decision of the NSB and required the petitioner to pay the wages and
other monetary benefits corresponding to the unexpired portion of the manning contract on the
ground that the termination of said contract by petitioner was without valid cause.

Issues:
(1) Whether or not the respondent NLRC had no more jurisdiction to entertain private respondents’
appeal because the NSB decision became final and executory for failure of said respondents to serve
on the petitioner a copy of their ‘APPEAL AND MEMORANDUM OF APPEAL’ within the ten (10)
day reglementary period for appeal and even after the expiration of said period.

(2) Whether or not the respondent Commission acted without or in excess of its jurisdiction, or
with grave abuse of discretion in said NSB Cases Nos. 2250-79 and 2252-79 when it adjudged the
petitioner liable to the respondents-seamen for terminating its employment contracts with them
despite the fact that prior authorization to terminate or cancel said employment contracts and to
disembark the said respondents was first secured from, and was granted by, the National Seamen
Board, the government agency primarily charged with the supervision and discipline of seamen and
the approval and enforcement of employment contracts.

Ruling:
(1) On the jurisdictional issue of the appeal, the Court referred to Article 223 (now 229) of the Labor
Code which provides the provision of appeals, Article 223 of the Labor Code literally provides:

"Appeal. — Decisions, awards, or orders of the Labor Arbiters or compulsory arbitrators

are final and executory unless appealed to the Commission by any or both of the parties
within ten (10) days from receipt of such awards, orders, or decisions. Such appeal may be
entertained only on any of the following grounds:

(a) If there is a prima facie evidence of abuse of discretion on the part of the Labor Arbiter
or compulsory arbitrator;
(b) If the decision, order, or award was secured through fraud or coercion, including graft
and corruption;
(c) If made purely on questions of law; and
(d) If serious errors in the findings of facts are raised which would cause grave or
irreparable damage or injury to the Appellant.

To discourage frivolous or dilatory appeals, the Commission or the Labor Arbiter shall
impose reasonable penalty, including fines or censures, upon the erring parties.”

The Court arrived at the conclusion that the shortened period of ten (10) days fixed by Article 223
(now 229) contemplates calendar days and not working days. It was persuaded to this conclusion,
if only because it believes that it is precisely in the interest of labor that the law has commanded
that labor cases be promptly, if not peremptorily, dispose of. Long periods for any acts to be done
by the contending parties can be taken advantage of more by management than by labor. Most
labor claims are decided in their favor and management is generally the appellant. Delay, in most
instances, gives the employers more opportunity not only to prepare even ingenious defenses, what
with well-paid talented lawyers they can afford, but even to wear out the efforts and meager
resources of the workers, to the point that not infrequently the latter either give up or compromise
for less than what is due them.

(2) The Court held that the NLRC has indeed overstepped the boundaries of its reviewing authority
and was over-lenient. As to whether or not respondents had breached their contract with petitioner
is a factual issue, which peculiar nuance to determine is with NSB, the fact-finding authority for the
case at hand. Notwithstanding the fact that even if it was nothing more than the interpretation of
the cablegram sent by respondents to petitioner on March 23, 1979 that were the only question to
be resolved, that is, whether or not it carried with it or connoted a threat which naturally panicked
petitioner, which, to be sure, could be a question of law, still, the Court sees that the conclusion of
the NLRC cannot be justified. The Commission ruled that in the exercise of their right to present
any grievances they had and in their desire to alleviate their condition, it was but well and proper
for respondents to make a proposal for increase of their wages, which petitioner could accept or
reject. The Court did not see it that way.

In its manifestation and comment, even the Solicitor General submitted that there was valid
justification on the part of petitioner and/or its principal to terminate the manning contract.
Likewise, the Court said, “It is timely to add here in closing that situations wherein employers are
practically laid in ambush or placed in a position not unlike those in a highjack whether in the air,
land or mid-sea must be considered to be what they really are: acts of coercion, threat and
intimidation against which the victim has generally no recourse but to yield at the peril of irreparable
loss. And when such happenings affect the national economy, as pointed out by the Solicitor General,
they must be treated to be in the nature of economic sabotage. They should not be tolerated. This
Court has to be careful not to sanction them.”
 G.R. Nos. 178034 & 178117 G R. Nos. 186984-85 , October 17, 2013
ANDREW JAMES MCBURNIE, Petitioner, vs. EULALIO GANZON, EGI-MANAGERS, INC.
and E. GANZON, INC., Respondents.
REYES, J.:
The relevance of the instant case pertains to the matter of Appeal Bond Reduction.
Brief Background:
Andrew James McBurnie is an Australian National who instituted a complaint for illegal dismissal
and other monetary claims against the respondents. He claimed that on May 1, 1999, he signed a
five-year employment agreement with EGI as Executive President to manage the latter’s hotels and
resorts located in the Philippines. McBurnie worked until November of the same year until he had
an accident and had to return to his homeland to recuperate. However, when he left for Australia,
he had not yet obtained a DOLE permit to work in the Philippines; and while he was there, EGI
terminated his contract because his services were no longer need since the intended project would
not push through.

EGI, in its opposition to McBurnie’s complaint, denied the existence of employer-employee

relationship because the agreement was to jointly invest in a company to manage hotels, and the
alleged employment contract was executed solely for the purpose of obtaining a working permit.

The Labor Arbiter declared the illegal dismissal illegal and awarded $985,000.00 as salary and
benefit plus P2,000,000.00 for damages and attorney’s fee. EGI appealed to NLRC and posted an
appeal bond of P100,000.00, and filed a memorandum of appeal and a motion to reduce bond to
which the Commission denied and required an additional bond of more than P54 Million. Because
of EGI’s failure to post the required additional bond, thus the appeal was dismissed.

EGI appealed to the CA which enjoined the enforcement of the LA’s decision in favour of McBurnie.

Issue:
Whether or not an appeal bond reduction is allowable in cases of appeal of an employer.

Ruling:
On the matter of the filing and acceptance of motions to reduce appeal bond, as provided in Section
6, Rule VI of the 2011 NLRC Rules of Procedure, the Court hereby RESOLVES that henceforth, the
following guidelines shall be observed:

(a) The filing of a motion to reduce appeal bond shall be entertained by the NLRC subject to the
following conditions: (1) there is meritorious ground; and (2) a bond in a reasonable amount is posted;

(b) For purposes of compliance with condition no. (2), a motion shall be accompanied by the posting
of a provisional cash or surety bond equivalent to ten percent (10,) of the monetary award subject of
the appeal, exclusive of damages and attorney's fees;

(c) Compliance with the foregoing conditions shall suffice to suspend the running of the 1 0-day
reglementary period to perfect an appeal from the labor arbiter's decision to the NLRC;
(d) The NLRC retains its authority and duty to resolve the motion to reduce bond and determine the
final amount of bond that shall be posted by the appellant, still in accordance with the standards of
meritorious grounds and reasonable amount; and

(e) In the event that the NLRC denies the motion to reduce bond, or requires a bond that exceeds the
amount of the provisional bond, the appellant shall be given a fresh period of ten (1 0) days from notice
of the NLRC order within which to perfect the appeal by posting the required appeal bond.”
 G.R. NO. 152410, June 29, 2005
COMPUTER INNOVATIONS CENTER/NELSON YU QUILOS, Petitioners, v. NATIONAL
LABOR RELATIONS COMMISSION and REYNALDO C. CARIÑO, Respondents.
TINGA, J.:
Brief Background:
Herein private respondent Reynaldo Cariño (Cariño) was hired in September of 1995 by petitioner
Computer Innovations Center (CIC) as Instructor of Computer Technical Course, and he was
promoted to Head of the Education Department of CIC in May of 1997. On March 26, 1998, Cariño
received a call from petitioner Nelson Yu Quilos (Quilos) of CIC, who advised Cariño to resign from
his position. Two days later, or on March 28 1998, Quilos met Cariño at the company's technician's
laboratory and informed the latter that his services with the company should cease by March 31,
1998. Thus, the aggrieved Cariño lodged a complaint for illegal dismissal against CIC and Quilos
with the National Labor Relations Commission (NLRC) Regional Arbitration Branch in Davao City.

CIC, however, claimed that it received reports from its other employees regarding Cariño's
purported unprofessional conduct, adverting to a general lack of interpersonal skills and
moonlighting activities which conflicted with the interest of CIC – the moonlighting activities
which Cariño admitted during the meeting on March 28, 1998, and had refused a promotion offered
by CIC conditioned on his termination of involvement with other computer schools. Instead, as
claimed by CIC, Cariño announced during the said meeting that he would resign from CIC,
reporting for work only until March 31, 1998.

The Labor Arbiter rendered a decision on August 29, 1999, concluding that Cariño had been illegally
dismissed, and further ordering petitioners to pay the amount of Two Hundred Twenty Thousand
Six Hundred Sixty Six Pesos and Sixty Six Centavos (P220,666.66) representing backwages,
separation pay, and thirteenth (13th) month pay. A copy of the Decision was received by petitioners
on November 5, 1999, and on November 15, 1999, they filed a Notice of Appeal dated November 12,
1999 before the NLRC Regional Arbitration Branch, Davao City, attaching thereto a Memorandum
on Appeal. They likewise posted a bond of Ten Thousand Pesos (P10,000.00), a sum nowhere near
the sum of the award made by the LA. However, in their Memorandum of Appeal, petitioners had
requested a reduction of the cash or surety bond to Ten Thousand Pesos (P10,000.00) – citing the
ground for the reduction of the appeal bond was the purportedly great possibility of the reversal of
the Labor Arbiter's decision in light of the serious errors in the findings of fact and application of law
as well as the harshness and unfounded nature of the award.

The Commission denied said motion for reduction of appeal bond and dismissed the appeal on the
ground of "non-perfection." The NLRC ruled that "the mere perception [that] the appealed decision
would be reversed on appeal [did] not justify the reduction of the required appeal bond." The NLRC
decision was affirmed by the CA.

Herein petitioners has invoked the ruing in Star Angel case that there is a distinction between the
filing of an appeal within the reglementary period and its perfection, and that the appeal may be
perfected after the said reglementary period. In Star Angel case, it was held that the filing of a
motion for reduction of an appeal bond necessarily stays the reglementary period for appeal.

Issue:
Whether or not the ground for appeal bond reduction in the instant case is allowable.
Ruling:
The Court referred to Article 223 (now 229) of the Labor Code which is quite clear-cut on the matter.
The relevant portion of Article 223 (now 229) provides:
ART 223. Appeal. - Decisions, awards or orders of the Labor Arbiter are final and executory
unless appealed to the Commission by any or both parties within ten (10) calendar days from
receipt of such decisions, awards, or orders. . . .
In case of a judgment involving a monetary award, an appeal by the employer may be perfected
only upon the posting of a cash or surety bond issued by a reputable bonding company duly
accredited by the Commission in the amount equivalent to the monetary award in the
judgment appealed from. (Emphasis Supplied)
Logically, it is inferred that by the explicit provision of law, an appeal is perfected only upon
the posting of a cash or surety bond. Such requirement for posting the surety bond is
jurisdictional and cannot be trifled with. The word "only" makes it perfectly clear that the
lawmakers intended the posting of a cash or surety bond by the employer to be the exclusive
means by which an employer's appeal may be perfected. As evinced by the language of Article
223 (now 229), the posting of such bond is required before the NLRC can acquire jurisdiction
over the employer's appeal. x x x Invocation of this rule as a means of argument against the
strict imposition of the cash bond requirement is off-base, taking into consideration Article
223 (now 229).
Likewise, the NLRC Rules of Procedure reaffirms the explicit jurisdictional principle in Article
223 (now 229), even as it allows in justifiable cases, the reduction of the appeal bond, to wit:
RULE VI.
APPEALS
....
Section 3. Requisites for Perfection of Appeal. '(a) The appeal shall be filed within the
reglementary period as provided in Section 1 of this Rule; shall be under oath with proof of
payment of the required appeal fee and the posting of a cash or surety bond as provided in Section
5 of this Rule; shall be accompanied by a memorandum of appeal which shall state the grounds
relied upon and the arguments in support thereof; the relief prayed for; and a statement of the
date when the appellant received the appealed decision, order or award and proof of service on
the other party of such appeal.

A mere notice of appeal without complying with the other requisite aforestated shall not stop the
running of the period for perfecting an appeal.
....
Section 6. Bond. 'In case the decision of the Labor Arbiter, the Regional Director or his duly
authorized Hearing Officer involves a monetary award, an appeal by the employer shall be
perfected only upon the posting of a cash or surety bond, which shall be in effect until final
disposition of the case, issued by a reputable bonding company duly accredited by the
Commission or the Supreme Court in an amount equivalent to the monetary award, exclusive of
damages and attorney's fees.
The employer, his counsel, as well as the bonding company, shall submit a joint declaration under
oath attesting that the surety bond posted is genuine.
The Commission may, in justifiable cases and upon Motion of the Appellant, reduce the amount
of the bond. The filing of the motion to reduce bond shall not stop the running of the period to
perfect appeal.(Emphasis Supplied)

As it is very clear from both the Labor Code and the NLRC Rules of Procedure [kindly note that
the governing rules of procedure of NLRC is now the 2011 NRLC Rules of Procedure] that there
is legislative and administrative intent to strictly apply the appeal bond requirement, and that
the Court should give utmost regard to this intention. There is a concession to the employer,
in excluding damages and attorney's fees from the computation of the appeal bond. Not even
the filing of a motion to reduce bond is deemed to stay the period for requiring an
appeal. Nothing in the either Labor Code or the NLRC Rules of Procedure authorizes the
posting of a bond that is less than the monetary award in the judgment, or would deem such
insufficient postage as sufficient to perfect the appeal.

The appeal bond requirement is a rule of jurisdiction and not of procedure, and it cannot be
trifled with. There is little leeway for condoning a liberal interpretation thereof, and certainly
none premised on the ground that its requirements are mere technicalities. It must be
emphasized that there is no inherent right to an appeal in a labor case, as it arises solely from
grant of statute, namely the Labor Code. Non-compliance with such legal requirements is fatal
and has the effect of rendering the judgment final and executory. The herein petitioners cannot
be allowed to seek refuge in a liberal application of rules for their act of negligence.

Moreover, while indeed the Court noted that in Star Angel case it was held that the filing of a
motion for reduction of an appeal bond necessarily stays the reglementary period for appeal.
However, in the instant case, the motion for reduction of appeal bond, which was incorporated
in the appeal memorandum, was filed only on the tenth or final day of the reglementary period.
Under such circumstance, the motion for reduction of appeal bond can no longer be deemed
to have stayed the appeal, and the petitioner faces the risk, as had happened in this case, of
summary dismissal of the appeal for non-perfection.

In the Star Angel case to the distinction between the period to file the appeal and to perfect
the appeal has been pointedly made only once by the Court in the case of Gensoli v. NLRC thus,
it has not acquired the sheen of venerability reserved for repeatedly-cited cases. The
distinction, if any, is not particularly evident or material in the Labor Code; hence, the
reluctance of the Court to adopt such doctrine. Moreover, the present provision in the NLRC
Rules of Procedure, that "the filing of a motion to reduce bond shall not stop the running of
the period to perfect appeal" flatly contradicts the notion expressed in Star Angel that there is
a distinction between filing an appeal and perfecting an appeal.

Said disposition of Star Angel was premised on the ruling that a motion for reduction of the
appeal bond necessarily stays the period for perfecting the appeal, and that the employer
cannot be expected to perfect the appeal by posting the proper bond until such time the said
motion for reduction is resolved. The unduly stretched-out distinction between the period to
file an appeal and to perfect an appeal was not material to the resolution of Star Angel, and
thus could properly be considered as obiter dictum.
The Court, in closing, said, “One final note. As earlier stated, the underlying purpose of the
appeal bond is to ensure that the employee has properties on which he or she can execute upon
in the event of a final, providential award. The non-payment or woefully insufficient payment of
the appeal bond by the employer frustrates these ends. Respondent Cariño alleges in his
Comment before this Court that petitioner Quilos and his wife have since gone abroad, and
wonders aloud whether he still would be able to collect his monetary award considering the
circumstances. Petitioners, in their Reply and Memorandum, do not aver otherwise. Indeed, such
eventuality appears plausible considering that Quilos himself did not personally verify the
petition, and had in fact executed a Special Power of Attorney in favor of his counsel, Atty.
Bernabe B. Alabastro, authorizing the filing of cases in his name. It does not necessarily follow
that the absence of Quilos from this country precludes the execution of the award due Cariño.
However, if the absence of Quilos from this country proves to render impossible the execution of
judgment in favor of Cariño, then the latter's victory may sadly be rendered pyrrhic. The appeal
bond requirement precisely aims to prevent empty or inconsequential victories by the laborer,
and it is hoped that herein petitioners' refusal to post the appropriate legal appeal bond does not
frustrate the ends of justice in this case.”
 G.R. No. 110494. November 18, 1996.
REY O. GARCIA, Petitioner, v. NATIONAL LABOR RELATIONS COMMISSION, Second
Division, composed of HON. EDNA BONTO-PEREZ as Presiding Commissioner HON.
ROGELIO RAYALA as Commissioner, and MAHAL KONG PILIPINAS, INC, Respondents.
KAPUNAN, J.:
Brief Background:
Herein petitioner Rey O. Garcia was hired by private respondent Mahal Kong Pilipinas and edit
articles, new items, literary contributions, essays, manuscripts, and other features to be published
in the Say Magazine and other publications owned by private Respondent. On March 16, 1992,
petitioner’s employment was terminated. At that time, he was allegedly receiving a monthly salary
of Eight Thousand Pesos (P8,000.00). Thus, Garcia filed a complaint for illegal dismissal against
private respondent with the National Labor Relations Commission (NLRC). Summons were
thereafter duly served on private respondent to appear for a mandatory conference to be held on
April 29, 1992, and on the appointed date, private respondent, represented by Necy Avecilla, sought
a postponement of said conference which motion was granted and reset the conference on May 8,
1992. Yet again, on May 8, 1992, private respondent failed to appear prompting the Labor Arbiter to
reset the conference on May 27, 1992 - with warning that failure to appear and submit its position
paper on said date will be deemed a waiver of its right to be heard and to present its evidence.

On May 27, 1992, both parties appeared. Herein etitioner filed an amended complaint, a copy of
which was served on private respondent in open court, and by mutual agreement of the parties, the
filing of their respective position papers as well as the next hearing was scheduled on June 9, 1992.
However, on said date private respondent yet again failed to attend and instead filed a letter
requesting for the postponement of the hearing. Petitioner objected and instead moved that private
respondent be declared in default and that he be allowed to present his evidence ex parte. Said
motion was granted and petitioner was given one (1) week to submit his position paper and
documentary evidence after which the case was to be considered submitted for decision. Herein
petitioner filed his position paper on June 11, 1992 and on June 15, 1992, private respondent, through
a letter from Marilou L. Bocobo, requested Labor Arbiter Nieves V. de Castro for time to answer
petitioner’s allegations. The letter-request, found to be merely dilatory, was denied.

The LA ordered the reinstatement of herein petitioner to his former position effective August 16,
1992 with full backwages of P24,000.00 (from March 16, 1992 to August 15, 1992) and all other
benefits complainant was receiving prior to his termination with notice to respondent that
reinstatement order is immediately executory even pending appeal. Herein private respondent
received a copy on September 10, 1992, of the said decision. And instead of filing an appeal
therefrom, private respondent, through its company president Michael G. Say, wrote yet another
letter to the labor arbiter expressing surprise and disappointment of allegedly erroneous decision.

Since no appeal was filed from said decision, the same became final and executory. Accordingly, a
writ of execution was issued on November 13, 1992. Private respondent filed a petition for
preliminary injunction with respondent NLRC. Petitioner moved for a reconsideration of the said
resolution contending that the subject decision had long become final and executory. However, on
March 10, 1993, respondent NLRC issued a resolution declaring the decision dated August 13, 1992
as vacated and set aside and the writ of execution was declared quashed. A new decision was
rendered remanding the case for reception of evidence with dispatch.

Issue:
Whether or not the unverified letter sent by private respondent, through its company president, is
proper appeal.

Ruling:
The Court took note that in the case at bar, records bear out that private respondent did not comply
with the foregoing mandatory rules on appeals. After receiving a copy of the decision, private
respondent through its president, wrote the labor arbiter who rendered the decision and expressed
dismay over the judgment. No appeal was taken therefrom within ten (10) days from
September 10, 1992, the date private respondent received a copy of such judgment. Neither
was a cash or surety bond posted by the private Respondent.

Assuming arguendo that said letter is considered a valid notice of appeal, the lack of posting of a
cash or surety bond as required by law, is fatal. The posting of bond in appeals of employers with
monetary consideration is not merely a procedural matter but jurisdictional. It is elementary that
when a judgment in question involves a monetary award, the second paragraph of Article 223 (now
229) of the Labor Code, as amended by R.A. No. 6715, provides that an appeal by the employer may
be perfected only upon the posting of a cash or surety bond issued by a reputable bonding company
duly accredited by the NLRC in the amount equivalent to the monetary award in the judgment
appealed from.

The NLRC in the instant case has clearly committed grave abuse of discretion and lack of
jurisdiction in treating the letter of private respondent’s president as an appeal from the judgment
of the labor arbiter.

Time and time again, the Court has held that the perfection of an appeal in the manner and within
the period prescribed by law is not only mandatory but also jurisdictional. Failure to conform with
the rules regarding appeal will certainly render the judgment final and executory, hence,
unappealable.
 G.R. No. 80600 March 21, 1990
PHILIPPINE TELEGRAPH AND TELEPHONE CORPORATION, petitioner, vs. NATIONAL
LABOR RELATIONS COMMISSION and BOBBY TORIBIANO, respondents.

DP Mercado & Associates for petitioner.

Oscar E. Dinopol for private respondent.
REGALADO, J.:
Brief Background:
The instant case is one of illegal dismissal of an employee of Philippine Telegraph and Telephone
Corporation (PTTC). Herein private respondent is a counter-clerk and long distance operator
working for petitioner. On August 24, 1985, he was terminated by the petitioner-company for
tampering with the vodex receipt by writing the amount of P41.15 as appearing in the duplicate
while the original copy issued to the customer was P113.25. Petitioner-company alleged that the Commented [Ma1]: Complainant was employed with
same was done by the complainant out of his illegal interest and the difference of P72.10 in the the respondent since February 1, 1979 at its branch
receipt was used for his own personal comfort; that his intention to tamper (with) and malverse station at General Santos City, first as a collector and
later as a counterclerk.
company funds is very glaring to be ignored. It was further argued that the acts of the complainant
reflect that he is morally deprived and, therefore, could not be trusted considering that he violated
the trust and confidence reposed upon him which constitutes a valid reason for his termination.

The assailed decision of respondent Commission which affirmed with modification the decision of
Labor Arbiter Nicolas S. Sayon, ordered the herein petitioner to: (1) reinstate complainant to his
former position without payment of backwages; (2) pay complainant his unpaid wages for the month
of July, 1985; and (3) pay complainant his entitlement on holiday pay, rest day pay and incentive leave
pay for three years starting from August 23, 1982 to August 23, 1983. On appeal to respondent
commission, petitioner submitted uncontracted evidence showing payment to private respondent
of his holiday pay and rest day pay, and private respondent's non-entitlement to incentive leave pay
due to his enjoyment of vacation leave privileges, consistent with Article 95, Chapter III, Title I,
Book III of the Labor Code. The same was however rejected by respondent commission on the
justification that it was not presented at the first opportunity, presumably when the case was
pending with the labor arbiter.

Issues:
(1) Whether or not the offense committed by the employee justifies his outright dismissal.
(NO)
(2) Whether or not the submission of uncontracted evidence by petitioner on appeal to
respondent Commission should have been allowed by the latter. (YES) Commented [Ma2]: showing payment to private
respondent of his holiday pay and rest day pay, and
Ruling: private respondent's non-entitlement to incentive leave
pay due to his enjoyment of vacation leave privileges,
(1) Per the findings of the labor arbiter, it was proved that the private respondent was indeed consistent with Article 95, Chapter III, Title I, Book III
alone in the office on July 26, 1985. He was busily performing his duties both as a counter- of the Labor Code.
clerk and long distance operator at the same time. The functions of which dual positions
precisely caused him to commit a mistake in the entry receipt through negligence. It was
further found that private respondent had repeatedly brought to the attention of petitioner-
company his predicament of having to singly perform manifold duties but the same were
left unheeded.

The Court found no cogent reason to disturb such findings. It is the well-entrenched rule
that when the conclusions of the labor arbiter are sufficiently corroborated by the evidence
 on record, the same should be respected by appellate tribunals since the Labor Arbiter is in
a better position to assess and evaluate the credibility of the contending parties. Even the
failure of petitioner to present witnesses or counter-affidavits will not constitute a fatal error
as long as the parties were given a chance to submit position papers on the basis of which
the labor arbiter rendered a decision.

Notwithstanding the foregoing, even the assumption that there may have been a valid
ground for dismissal of the private respondent, the imposition of a supreme penalty would
certainly be very harsh and disproportionate to the infraction he committed, especially if it
was put into consideration that it was his first offense in his seven (7) years of faithful and
satisfactory service with the company. In addition, the fact that the imputed defalcation
involved only the meager sum of P72.10, the same has bolstered the credibility of the
explanation of private respondent's defense.

The Court said, “While an employer has its own interests to protect and, pursuant thereto,
it may terminate an employee for a just cause, such prerogative to dismiss or lay off an
employee must not be abusively exercised. Such power should be tempered with
compassion and understanding. The employer should bear in mind that, in the execution
of said prerogative, what is at stake is not only the employee's position but his livelihood as
well.

This ruling is only in keeping with the constitutional mandate for the State to afford full
protection to labor such that, when conflicting interests of labor and capital are to be
weighed on the scales of social justice, the heavier influence of the latter should be
counterbalanced by the sympathy and compassion the law must accord the underprivileged
worker.”

Even if herein petitioner-company's claim that the offense is of the nature of falsification,
which justifies outright dismissal, was of no moment. It is not for the Court to rule upon in
the present petition if whether or not the infraction committed by private respondent
constitutes a criminal act. Of course, the private respondent cannot be considered faultless
entirely so that he may be absolved from liability. Thus, the modification of the decision of
the Labor Arbiter ordering reinstatement of private respondent to his former position
without backwages is the proper relief, without prejudice and subject to the condition that
should he commit a similar offense, the same will justify his outright dismissal.

(2) Evidence submitted on Appeal to the NLRC

The Court noted that, “On appeal to respondent commission, petitioner submitted
uncontracted evidence showing payment to private respondent of his holiday pay and rest day
pay, and private respondent's non-entitlement to incentive leave pay due to his enjoyment of
vacation leave privileges, consistent with Article 95, Chapter III, Title I, Book III of the Labor
Code. Such evidence was, however, rejected by respondent commission on the erroneous
justification that it was not presented at the first opportunity, presumably when the case was
pending with the labor arbiter.”

It held, “The belated presentation of the evidence notwithstanding, respondent commission

should have considered them just the same. As correctly pointed out by the Solicitor General,
who has impartially taken a contrary view vis-a-vis that portion of said decision of respondent
commission which he is supposed to defend, technical rules of evidence are not binding in
labor cases. Labor officials should use every and reasonable means to ascertain the facts in
each case speedily and objectively, without regard to technicalities of law or procedure, all in
the interest of due process.

Thus, even if the evidence was not submitted to the labor arbiter, the fact that it was duly
introduced on appeal to respondent commission is enough basis for the latter to have been
more judicious in admitting the same, instead of falling back on the mere technicality that
said evidence can no longer be considered on appeal. Certainly, the first course of action would
be more consistent with equity and the basic notions of fairness.”
 G.R. No. 160871 February 6, 2006
TRIAD SECURITY & ALLIED SERVICES, INC. and ANTHONY U. QUE, Petitioners, vs.
SILVESTRE ORTEGA, JR., ARIEL ALVARO, RICHARD SEVILLANO, MARTIN CALLUENG,
and ISAGANI CAPILA, Respondents.
CHICO-NAZARIO, J.:
Pertinent Provisions:
Article 229 (223). Appeal. Decisions, awards, or orders of the Labor Arbiter are final and
executory unless appealed to the Commission by any or both parties within ten (10) calendar
days from receipt of such decisions, awards, or orders. Such appeal may be entertained only on
any of the following grounds:

(a) If there is prima facie evidence that there is grave abuse of discretion on the part of the
Labor Arbiter;
(b) If the decision, order or award was secured through fraud or coercion, including graft and
corruption;
(c) If made purely on questions of law; and
(d) If serious errors in the findings of facts are raised which would cause grave or irreparable
damage or injury to the appellant.

In case of a judgment involving a monetary award, an appeal by the employer may be

perfected only upon the posting of a cash or surety bond issued by a reputable bonding
company duly accredited by the Commission in the amount equivalent to the monetary award
in the judgment appealed from.

In any event, the decision of the Labor Arbiter reinstating the dismissed employee, insofar
as the reinstatement aspect is concerned shall immediately be executory, even pending appeal.
The employee shall either be admitted back to work under the same terms and conditions
prevailing prior to his dismissal or separation, or at the option of the employer, merely
reinstated in the payroll. The posting of a bond by the employer shall not stay the execution for
reinstatement provided herein.

To discourage frivolous or dilatory appeals, the Commission or the Labor Arbiter shall
impose reasonable penalty, including fines or censures upon the erring parties.

In all cases, the appellant shall furnish a copy of the memorandum of appeal to the other
party who shall file an answer not later than ten (10) calendar days from receipt thereof.

The Commission shall decide all cases within twenty (20) calendar days from receipt of the
answer of the appellee. The decision og the Commission shall be final and executory after ten
(10) calendar days from receipt thereof by the parties.

Any law enforcement agency may be deputized by the Secretary of Labor and Employment
or the Commission in the enforcement of decisions, awards, or orders.

Article 294 (279). Security of Tenure. In cases of regular employment, the employer shall not
terminate the services of an employee except for a just cause or when authorized by this Title.
An employee who is unjustly dismissed from work shall be entitled to reinstatement without
 loss of seniority rights and other privileges and to his full backwages, inclusive of allowances,
and to his other benefits or their monetary equivalent computed from the time his
compensation was withheld from him up to the time of his actual reinstatement.

Subsequent to the ruling in Triad Security case, the NLRC amended its 2005 Rules of Procedure
and replaced it with 2011 Rules. One important amendment is the addition of Rule XII titled
“Extraordinary Remedies,” which allows a party to file a petition to annul or modify an order or
resolution of a labor arbiter on the ground of abuse of discretion or series errors in the findings
of facts, fraud, among other grounds.

Brief Background:
Herein petitioner Triad Security and Allied Services, Inc., (Triad Security) is a duly licensed
security agency owned by co-petitioner Anthony U. Que, while respondents Silvestre Ortega,
Jr., Ariel Alvaro, Richard Sevillano, Martin Callueng, and Isagani Capila were formerly employed
by petitioner Triad Security as security guards., respondents filed a complaint on March 25, 1999
against petitioners and one Ret. B/Gen. Javier D. Carbonell for underpayment/nonpayment of
salaries, overtime pay, premium pay for holiday and rest day, service incentive leave pay, holiday
pay, and attorney’s fees, which was amended on April 20, 1999 to include the charges of illegal
dismissal, illegal deductions, underpayment/nonpayment of allowance, separation pay, and
claims for 13th month pay, moral and exemplary damages as well as night shift differential.
According to respondents, during the time that they were receiving compensation which was
below the minimum wage fixed by law while being in the employ of petitioners, they were, and
were also made to render services every day for 12 hours but were not paid the requisite overtime
pay, nightshift differential, and holiday pay. They likewise lamented the fact that petitioners
failed to provide them with weekly rest period, service incentive leave pay, and 13th month pay.
As a result of these perceived unfairness, a complaint was filed by respondents filed before the
Labor Standards Enforcement Division of the Department of Labor on January 6, 1999. Their
services were terminated without the benefit of notice and hearing when the petitioner learned
of the complaint.

Petitioners denied respondents’ claim of illegal dismissal for their part and explained that
management policies dictate that the security guards be rotated to different assignments to
avoid fraternization and that they be required to take refresher courses at their headquarters;
which respondents allegedly refused to comply with, and went on leave or simply refused to
report at their headquarters instead. As for respondents’ money claims, petitioners insisted that
respondents worked for only eight hours a day, six days a week and that they received their
premium pays for services rendered during holidays and rest day. The service incentive leave of
respondents was allegedly made payable as soon as respondents applied for said benefit.

The Arbiter ruled in favor of the respondents and ordered herein petitioners to them to their
former jobs as security guards, and to pay jointly and solidarily complainants’ backwages and
to such further backwages accrued until reinstatement order is complied with by petitioners
herein. Petitioners failed to seasonably file an appeal with the National Labor Relations
Commission, the decision of the labor arbiter became final and executory prompting
respondents to file a motion for the issuance of writ of execution. Several issues were raised as
regard the computation of the awards for the respondents to the point that the issue was
elevated to the Court of Appeals – which led the appellate court to issue a temporary restraining
order enjoining the execution or enforcement of the Labor Arbiter’s order.
 The Court of Appeals took note of the "procedural but fatal flaw" committed by petitioners
when they immediately elevated their case via petition for certiorari before the Court of Appeals
without first seeking recourse from the NLRC in violation not only of the Rules of Procedure of
said body but also of the doctrine of exhaustion of administrative remedies.

Issues:
(1) Whether or not the NLRC may issue a writ of certiorari under Art. 229 of the Labor Code.
(YES)
(2) Whether or not the award of either separation pay and/or backwages preclude that of the
other. (NO)

Ruling:

(1) Although the petitioners maintain that the doctrine of exhaustion of administrative
remedies is not absolute as it accepts of certain exceptions such as when an appeal would
not be an adequate remedy there being an order or execution already issued and the
implementation of said writ loomed as a great probability.

The Court held that “It is a basic tenet of procedural rules that for a special civil action for a
petition for certiorari to prosper, the following requisites must concur: (1) the writ is directed
against a tribunal, a board or an officer exercising judicial or quasi-judicial functions; (2) such
tribunal, board or officer has acted without or in excess of jurisdiction, or with grave abuse of
discretion amounting to lack or excess of jurisdiction; and (3) there is no appeal or any plain,
speedy and adequate remedy in the ordinary course of law.

In this case, petitioners insist that the NLRC is bereft of authority to rule on a matter involving
grave abuse of discretion that may be committed by a labor arbiter. Such conclusion, however,
proceeds from a limited understanding of the appellate jurisdiction of the NLRC under Article
223 (now 229) of the Labor Code which states:

ART. 223 (229). APPEAL

Decisions, awards, or orders of the Labor Arbiter are final and executory unless
appealed to the Commission by any or both parties within ten (10) calendar days from
receipt of such decisions, awards, or orders. Such appeal may be entertained only on
any of the following grounds:

(a) If there is prima facie evidence of abuse of discretion on the part of the Labor
Arbiter.

In the case of Air Services Cooperative v. Court of Appeals, we had the occasion to explain the
scope of said article of the Labor Code to mean –

x x x Also, while the title of Article 223 seems to provide only for the remedy of appeal as that
term is understood in procedural law and as distinguished from the office of certiorari,
nonetheless, a closer reading thereof reveals that it is not as limited as understood by the
petitioners x x x.
 xxxx

Abuse of discretion is admittedly within the ambit of certiorari and its grant thereof to the
NLRC indicates the lawmakers’ intention to broaden the meaning of appeal as that term is
used in the Code x x x.

Likewise, in the same case, [the] Court quoted with approval the following observation of the
Court of Appeals:

The Court did not see how appeal would have been inadequate or ineffectual under the
premises. On the other hand, being the administrative agency especially tasked with the
review of labor cases, [the NLRC] is in a far better position to determine whether petitioners’
grounds for certiorari are meritorious. Neither is there any cause for worry that appeal to the
Commission would not be speedy as the Labor Code provides that the Commission shall decide
cases before it, within twenty (20) calendar days from receipt of the Answer of Appellee x x x.

Given the foregoing, it was held that the Court of Appeals correctly dismissed the petition for
certiorari brought before it.”

(2) Petitioners insist that their monetary obligation, as contained in the February 28, 2000
decision of the labor arbiter, had already been fully satisfied, and posit the argument that
with respondents’ receipt of their separation pay, they had opted not to seek reinstatement
to their former jobs and elected instead to sever their employment with petitioner Triad
Security. In fact, according to petitioners, respondents had already found new employments
and to award them further backwages would be tantamount to unjust enrichment. Thus,
petitioners maintain that there is no more basis to hold them liable for the accrued
backwages stated in the recent computation.

Such argument is untenable.

The award of either separation pay and/or backwages does not preclude that of the other
as this court had, in proper cases, ordered the payment of both.

The Court held that “Article 279 (now 294) of the Labor Code, as amended, states:

Article 294 (279). Security of Tenure. In cases of regular employment, the employer shall not
terminate the services of an employee except for a just cause or when authorized by this Title. An
employee who is unjustly dismissed from work shall be entitled to reinstatement without loss of
seniority rights and other privileges and to his full backwages, inclusive of allowances, and to his
other benefits or their monetary equivalent computed from the time his compensation was
withheld from him up to the time of his actual reinstatement.

An illegally dismissed employee is entitled to two reliefs, namely: backwages and reinstatement.
These are separate and distinct from each other. However, separation pay is granted where
reinstatement is no longer feasible because of strained relations between the employee and the
employer. In effect, an illegally dismissed employee is entitled to either reinstatement, if viable, or
separation pay if reinstatement is no longer viable and backwages.
Backwages and separation pay are, therefore, distinct reliefs granted to one who was illegally
dismissed from employment. The award of one does not preclude that of the other as this court
had, in proper cases, ordered the payment of both.

In this case, the labor arbiter ordered the reinstatement of respondents and the payment of their
backwages until their actual reinstatement and in case reinstatement is no longer viable, the
payment of separation pay. Under Article 223 (now 229) of the Labor Code, "the decision of the
Labor Arbiter reinstating a dismissed or separated employee, insofar as the reinstatement aspect
is concerned, shall be immediately executory, even pending appeal." The same provision of the law
gives the employer the option of either admitting the employee back to work under the same terms
and conditions prevailing before his dismissal or separation from employment or the employer
may choose to merely reinstate the employee to the payroll. It bears emphasizing that the law
mandates the prompt reinstatement of the dismissed or separated employee. This, the petitioners
failed to heed. They are now before this Court insisting that they have fully disposed of their legal
obligation to respondents when they paid the latter’s separation pay. [The Court] do[es] not agree.

It should be pointed out that an order of reinstatement by the labor arbiter is not the same as
actual reinstatement of a dismissed or separated employee. Thus, until the employer
continuously fails to actually implement the reinstatement aspect of the decision of the
labor arbiter, their obligation to respondents, insofar as accrued backwages and other
benefits are concerned, continues to accumulate. It is only when the illegally dismissed
employee receives the separation pay that it could be claimed with certainty that the
employer-employee relationship has formally ceased thereby precluding the possibility
of reinstatement. In the meantime, the illegally dismissed employee’s entitlement to backwages,
13th month pay, and other benefits subsists. Until the payment of separation pay is carried out,
the employer should not be allowed to remain unpunished for the delay, if not outright refusal, to
immediately execute the reinstatement aspect of the labor arbiter’s decision.”
 G.R. No. 197556, March 25, 2015
WATERFRONT CEBU CITY CASINO HOTEL, INC. AND MARCO PROTACIO, Petitioners, v.
ILDEBRANDO LEDESMA, Respondent.

VILLARAMA, JR., J.:

Pertinent Provisions:
Sec. 4, Rule 65. (RULES OF COURT). When and where to file the petition. – The petition shall be
filed not later than sixty (60) days from notice of the judgment, order, or resolution. In case a
motion for reconsideration or new trial is timely filed, whether such motion is required or not, the
petition shall be filed not later than sixty (60) days counted from the notice of the denial of the
motion. x x x

Brief Background:
This case is one of illegal dismissal: herein respondent Ildebrando Ledesma was illegally dismissed
from his employment by petitioner Waterfront Cebu City Casino Hotel, Inc. (Waterfront).
Respondent was employed as a House Detective at Waterfront located at Salinas Drive, Cebu City.
Complaints were filed before Waterfront by Christe Mandal, a supplier of a concessionaire of
Waterfront, and Rosanna Lofranco, who was seeking a job at the same hotel - from the affidavits
and testimonies of Mandal and Lofranco during the administrative hearings conducted by
Waterfront, the latter found, among others, that Ledesma performed non-consensual sexual acts
and/or overtures to both Mandal and Lofranco. Hence, Ledesma was terminated from his job.

Ledesma filed a complaint for illegal dismissal and the LA found that the allegations leveled against
Ledesma are mere concoctions, and concluded that Ledesma was illegally dismissed. However, the
NLRC reversed the ruling of the LA and held that Ledesma’s acts of sexual overtures to Mandal and
Lofranco constituted grave misconduct which justified his dismissal from employment. Ledesma
filed a MR which was subsequently denied by NLRC in a Resolution dated February 22, 2010.

A copy of the said Resolution was received by Atty. Gines Abellana (Atty. Abellana), Ledesma’s
counsel of record, on March 15, 2010 and on May 17, 2010,14 or sixty-three (63) days after Atty.
Abellana received a copy of the NLRC’s Resolution denying the motion for reconsideration, said
counsel filed a petition for certiorari under Rule 65 of the Rules of Court before the CA. In its
Comment, Waterfront prayed for the outright dismissal of the petition on the ground that it was
belatedly filed.

Ledesma, now assisted by a new counsel, filed a motion for leave to file amended petition on August
5, 2010, and sought the admission of his Amended Petition for Certiorari. Ledesma contended
amended petition that his receipt on March 24, 2010 (and not the receipt on March 15, 2010 by Atty.
Abellana), is the reckoning date of the 60-day reglementary period within which to file the petition.
Hence, Ledesma claims that the petition was timely filed on May 17, 2010. Said leave of court to
Ledesma was granted by the CA, and admitted his amended petition for certiorari. The CA
rendered a Decision dated March 17, 2011, reversing the Decision of the NLRC and reinstating the
ruling of the LA. A motion for reconsideration filed by Waterfront was denied by the CA in a
Resolution dated June 21, 2011. Thus, the present petition for review on certiorari where Waterfront
raised the main issue of whether the petition for certiorari was timely filed with the CA.

Issue:
Whether or not the unjustified failure of Ledesma to file his petition for certiorari before the CA
within the 60-day period is a ground for the outright dismissal of said petition. (YES)

Ruling:
The petition for certiorari was filed with the CA beyond the 60-day period

Section 4, Rule 65 of the Rules of Court, as amended by A.M. No. 07-7-12-SC, reads:
SEC. 4. When and where to file the petition. – The petition shall be filed not later than sixty (60)
days from notice of the judgment, order or resolution. In case a motion for reconsideration or new
trial is timely filed, whether such motion is required or not, the petition shall be filed not later than
sixty (60) days counted from the notice of the denial
of the motion.

If the petition relates to an act or an omission of a municipal trial court or of a corporation, a board,
an officer or a person, it shall be filed with the Regional Trial Court exercising jurisdiction over the
territorial area as defined by the Supreme Court. It may also be filed with the Court of Appeals or with
the Sandiganbayan, whether or not the same is in aid of the court’s appellate jurisdiction. If the
petition involves an act or an omission of a quasi-judicial agency, unless otherwise provided by law or
these rules, the petition shall be filed with and be cognizable only by the Court of Appeals.

In election cases involving an act or an omission of a municipal or a regional trial court, the petition
shall be filed exclusively with the Commission on Elections, in aid of its appellate jurisdiction.

In the case of Laguna Metts Corporation v. Court of Appeals, The Court categorically ruled that the
present rule now mandatorily requires compliance with the reglementary period. The period can
no longer be extended as previously allowed before the amendment, thus:

As a rule, an amendment by the deletion of certain words or phrases indicates an intention to change
its meaning. It is presumed that the deletion would not have been made if there had been no intention
to effect a change in the meaning of the law or rule. The amended law or rule should accordingly be
given a construction different from that previous to its amendment.

If the Court intended to retain the authority of the proper courts to grant extensions under Section 4
of Rule 65, the paragraph providing for such authority would have been preserved. The removal of the
said paragraph under the amendment by A.M. No. 07-7-12-SC of Section 4, Rule 65 simply meant that
there can no longer be any extension of the 60-day period within which to file a petition for certiorari.

The Court held that the rationale for the amendments under A.M. No. 07-7-12-SC is essentially to
prevent the use (or abuse) of the petition for certiorari under Rule 65 to delay a case or even defeat
the ends of justice. Deleting the paragraph allowing extensions to file petition on compelling
grounds did away with the filing of such motions. As the Rule now stands, petitions for certiorari
must be filed strictly within 60 days from notice of judgment or from the order denying a motion
for reconsideration.

In the subsequent case of Domdom v. Third & Fifth Divisions of the Sandiganbayan, the absence of
a specific prohibition in Section 4 of Rule 65, as amended, for the extension of the 60-day period to
file a petition for certiorari was construed as a discretionary authority of the courts to grant an
extension.
Republic v. St. Vincent De Paul Colleges, Inc. clarified the “conflict” between the rulings in Laguna
Metts Corporation and Domdom, in that the former is the general rule while the latter is the
exception, thus:

“What seems to be a “conflict” is actually more apparent than real. A reading of the foregoing rulings
leads to the simple conclusion that Laguna Metts Corporation involves a strict application of the
general rule that petitions for certiorari must be filed strictly within sixty (60) days from notice of
judgment or from the order denying a motion for reconsideration. Domdom, on the other hand,
relaxed the rule and allowed an extension of the sixty (60)-day period subject to the Court’s sound
discretion.”

In relaxing the rules and allowing an extension, the case of Thenamaris Philippines, Inc. v. Court of
Appeals reiterated the necessity for the party invoking liberality to advance a reasonable or
meritorious explanation for the failure to file the petition for certiorari within the 60-day period.

In Philippine National Bank v. Commissioner of Internal Revenue, the Court said:

“It is an accepted tenet that rules of procedure must be faithfully followed except only when, for
persuasive and weighting reasons, they may be relaxed to relieve a litigant of an injustice
commensurate with his failure to comply with the prescribed procedure. Concomitant to a liberal
interpretation of the rules of procedure, however, should be an effort on the part of the party invoking
liberality to adequately explain his failure to abide by the rules.”

Among the “recognized exceptions” are: (1) most persuasive and weighty reasons; (2) to relieve a
litigant from an injustice not commensurate with his failure to comply with the prescribed
procedure; (3) good faith of the defaulting party by immediately paying within a reasonable time
from the time of the default; (4) the existence of special or compelling circumstances; (5) the merits
of the case; (6) a cause not entirely attributable to the fault or negligence of the party favored by
the suspension of the rules; (7) a lack of any showing that the review sought is merely frivolous and
dilatory; (8) the other party will not be unjustly prejudiced thereby; (9) fraud, accident, mistake or
excusable negligence without appellant’s fault; (10) peculiar legal and equitable circumstances
attendant to each case; (11) in the name of substantial justice and fair play; (12) importance of the
issues involved; and (13) exercise of sound discretion by the judge guided by all the attendant
circumstances. (see Thenamaris Philippines, Inc. v. Court of Appeals)
 G.R. NO. 180551 : February 10, 2009
ERWIN H. REYES, Petitioner, v. NATIONAL LABOR RELATIONS COMMISSION, COCA-
COLA BOTTLERS PHILS. and/or ROTAIDA TAGUIBAO, Respondents.
CHICO-NAZARIO, J.:

AN EXCEPTION TO THE GENERAL RULE

Brief Background:
The instant case is a Special Civil Action for Certiorari under Rule 65 of the Revised Rules of Court
filed by petitioner Erwin H. Reyes, seeking to reverse and set aside the Resolutions dated November Commented [Ma3]: fixed-term employment after
1o, 2006 and November 9, 2007 of the Court of Appeals in CA-G.R. SP No. 96343 of the CA. an unsuccessful project, his services were no
longer needed by the company - Taguibao (HR
Mngr) asserted in their appeal that petitioner
The dismissed employee was ordered reinstated by the Labor Arbiter by the NLRC reversed said was merely employed for a particular project
decision. When the appeal was raised to the CA, the appellate court dismissed petitioner's Petition which turned out to be not viable. Petitioner was
for Certiorari therein for failure to give an explanation why copy of the said Petition was not subsequently terminated from work on account
personally served upon the counsel of the respondents, as required by Section 11, Rule 13 of the of the expiration of his employment contract.
Petitioner's claim of illegal dismissal was,
Revised Rules of Court.
therefore, tenuous.

Though the employee did not file a MR of the CA decision – despite this and the earlier failure to Commented [Ma4]: the NLRC reckoned the
computation of backwages only from the time
furnish employer personally a copy of the petition, the SC entertained and granted employee’s petitioner filed his Complaint for illegal dismissal
petition through the pen of Justice Chico-Nazario. before the Labor Arbiter. (3 years ago)

Issue:
Whether or not the CA gravely abused its discretion in not excusing herein petitioner’s procedural
lapses. (YES)

Ruling:
There is an exception to the general rule of indispensability of technical rules.

The Court noted that it is evident from a perusal of records that petitioner indeed failed to provide
the CA a written explanation as to why he did not personally serve a copy of his Petition therein
upon the adverse parties, as required by Section 11, Rule 138 of the Revised Rules of Court. The
records also readily reveal that petitioner did not file a timely Motion for Reconsideration of the 10
November 2006 Resolution of the Court of Appeals.

However, herein petitioner submits that he raised meritorious arguments in his Petition before the
CA, and the dismissal thereof on a mere technicality defeated the greater interest of substantial
justice. Reyes attributes the technical flaws committed before the appellate court to his former
counsel, and he urged the Court to excuse him therefrom since compliance with the procedural
rules calls for the application of legal knowledge and expertise which he, as a layman, cannot be
expected to know.

While it is true that for petitioner's failure to comply with Section 11, Rule 13 of the Revised Rules of
Court, his petition should be expunged from the records, as in the case of Solar Team
Entertainment, Inc. v. Ricafort, where the the Court stressed the mandatory character of Section 11,
Rule 13. However, in numerous cases, the Court has allowed a liberal construction of said rule when
doing so would be in the service of the demands of substantial justice and in the exercise of equity
jurisdiction of the SC.
The Court held in the case of Fulgencio v. National Labor Relations Commission the following
justification for its non-insistence on a written explanation as required by Section 11, Rule 13 of the
Revised Rules of Court:

The rules of procedure are merely tools designed to facilitate the attainment of justice. They
were conceived and promulgated to effectively aid the court in the dispensation of justice.
Courts are not slaves to or robots of technical rules, shorn of judicial discretion. In rendering
justice, courts have always been, as they ought to be, conscientiously guided by the norm that
on the balance, technicalities take a backseat against substantive rights, and not the other way
around. Thus, if the application of the Rules would tend to frustrate rather than promote justice,
it is always within our power to suspend the rules, or except a particular case from its operation.

The call for a liberal interpretation of the Rules is even more strident in the instant case which
petitioner's former counsel was obviously negligent in handling his case before the Court of
Appeals. It was petitioner's former counsel who failed to attach the required explanation to the
Petition in CA-G.R. SP No. 96343. Said counsel did not bother to inform petitioner, his client, of
the 10 November 2006 Resolution of the appellate court dismissing the Petition for lack of the
required explanation. Worse, said counsel totally abandoned petitioner's case by merely
allowing the reglementary period for filing a Motion for Reconsideration to lapse without taking
any remedial steps; thus, the 10 November 2006 Resolution became final and executory.

The basic general rule is that the negligence of counsel binds the client. Hence, if counsel
commits a mistake in the course of litigation, thereby resulting in his losing the case, his client
must perforce suffer the consequences of the mistake. The reason for the rule is to avoid the
possibility that every losing party would raise the issue of negligence of his or her counsel to
escape an adverse decision of the court, to the detriment of our justice system, as no party would
ever accept a losing verdict. This general rule, however, pertains only to simple negligence of
the lawyer. Where the negligence of counsel is one that is so gross, palpable, pervasive, reckless
and inexcusable, then it does not bind the client since, in such a case, the client is effectively
deprived of his or her day in court.

The circumstances of this case qualify it under the exception, rather than the general rule. The
negligence of petitioner's former counsel may be considered gross since it invariably resulted to the
foreclosure of remedies otherwise readily available to the petitioner. Not only was petitioner deprived
of the opportunity to bring his case before the Court of Appeals with the outright dismissal of his
Petition on a technicality, but he was also robbed of the chance to seek reconsideration of the
dismissal of his Petition. What further impel this Court to heed the call for substantial justice are the
pressing merits of this case which, if left overshadowed by technicalities, could result in flagrant
violations of the provisions of the Labor Code and of the categorical mandate of the Constitution
affording protection to labor.

Higher interests of justice and equity demand that petitioner should not be denied his day in court
and made him to suffer for his counsel's indiscretions. To cling to the general rule in this case would
only to condone, rather than rectify, a serious injustice to a party - - whose only fault was to repose
his faith and trust in his previous counsel - - and close our eyes to the glaring grave abuse of discretion
committed by the NLRC.
The Court likewise found, after ruling on the procedural matters in the instant case, remanding the
case to the appellate court for the determination of the substantive matters would only cause
further delay, so in the interest of fairness, it has resolved the substantive issues in the instant case.

Having thus settled the procedural matters in the instant case, the Court now proceeds to resolve
the substantive issues.

The Court is convinced beyond cavil that the NLRC committed grave abuse of its discretion,
amounting to lack or excess of jurisdiction, in modifying the 30 April 2005 Decision of the Labor
Arbiter, for in so doing, the NLRC not only disregarded the elementary statutory and jurisprudential
principles, but also violated the basic principles of social justice and protection to labor enshrined
in the Constitution.

Explicit is Art. 279 of the Labor Code which states:

Art. 279. Security of Tenure. - - In cases of regular employment, the employer shall not terminate
the services of an employee except for a just cause or when authorized by this Title. An employee
who is unjustly dismissed from work shall be entitled to reinstatement without loss of seniority
rights and other privileges and to his full backwages, inclusive of allowances, and to his other
benefits or their monetary equivalent computed from the time his compensation was withheld from
him up to the time of his actual reinstatement.

Applying the above-quoted statutory provision, this Court decreed in Pheschem Industrial
Corporation v. Moldez16 :

Article 279 of the Labor Code provides that an illegally dismissed employee shall be entitled, inter
alia, to the payment of his full backwages, inclusive of allowances and to his other benefits or their
monetary equivalent computed from the time that his compensation was withheld from him, i.e.,
from the time of his illegal dismissal, up to the time of his actual reinstatement. Thus, where
reinstatement is adjudged, the award of backwages and other benefits continues beyond the date
of the Labor Arbiter's Decision ordering reinstatement and extends up to the time said order of
reinstatement is actually carried out. (Emphasis supplied.)

The Court was more emphatic in Philippine Industrial Security Agency Corporation v. Dapiton,17
when it ruled that backwages had to be paid by the employer as part of the price or penalty he had
to pay for illegally dismissing his employee. It was to be computed from the time of the employee's
illegal dismissal (or from the time his compensation was withheld from him) up to the time of his
reinstatement.

One of the natural consequences of a finding that an employee has been illegally dismissed is the
payment of backwages corresponding to the period from his dismissal up to actual reinstatement.
The statutory intent of this matter is clearly discernible. The payment of backwages allows the
employee to recover from the employer that which he has lost by way of wages as a result of his
dismissal.18 Logically, it must be computed from the date of petitioner's illegal dismissal up to the
time of actual reinstatement. There can be no gap or interruption, lest we defeat the very reason of
the law in granting the same. That petitioner did not immediately file his Complaint should not
affect or diminish his right to backwages, for it is a right clearly granted to him by law - - should he
be found to have been illegally dismissed - - and for as long as his cause of action has not been
barred by prescription.

The law fixes the period of time within which petitioner could seek remedy for his illegal dismissal
and for as long as he filed his Complaint within the prescriptive period, he shall be entitled to the
full protection of his right to backwages. In illegal dismissal cases, the employee concerned is given
a period of four years from the time of his illegal dismissal within which to institute the complaint.
This is based on Article 1146 of the New Civil Code which states that actions based upon an injury
to the rights of the plaintiff must be brought within four years.19 The four-year prescriptive period
shall commence to run only upon the accrual of a cause of action of the worker.20 Here, petitioner
was dismissed from service on 15 September 2001. He filed his complaint for illegal dismissal on 14
June 2004. Clearly, then, the instant case was filed within the prescriptive period.

The Labor Arbiter, in his computation of the award for backwages to petitioner, had followed the
long-settled rule21 that full backwages should be awarded, to be reckoned from the time of illegal
dismissal up to actual reinstatement. The NLRC, however, modified the Labor Arbiter's award for
backwages by computing the same only from the time petitioner filed his Complaint for illegal
dismissal before the Labor Arbiter, i.e., on 24 October 2004, up to the day when the Labor Arbiter
promulgated his judgment, i.e., 30 April 2005. The NLRC provided no other explanation for its
modification except that it was just and equitable to reduce the amount of backwages given to
petitioner since, having been dismissed on 15 September 2001, it took him more than three years to
file his Complaint against respondents CCBP and Taguibao.

We find no justice or rationality in the distinction created by the NLRC; and when there is neither
justice or rationality, the distinction transgresses the elementary principle of equal protection and
must be stricken out. Equal protection requires that all persons or things similarly situated should
be treated alike, as to both rights conferred and responsibilities imposed.22 There is no sufficient
basis why petitioner should not be placed in the same plane with other illegally dismissed
employees who were awarded backwages without qualification.

Herein petitioner, having been unjustly dismissed from work, is entitled to reinstatement without
loss of seniority rights and other privileges and to full backwages, inclusive of allowances, and to
other benefits or their monetary equivalents computed from the time compensation was withheld
up to the time of actual reinstatement.23 Accordingly, backwages must be awarded to petitioner in
the amount to be computed from the time his employment was unlawfully terminated by
respondents CCBP and Taguibao on 15 September 2001 up to the time he was actually reinstated on
1 March 2006.

We also do not agree with the NLRC in deleting the directive of the Labor Arbiter for the
reinstatement of petitioner to his former position, on the flimsy excuse that the petitioner's position
as Route Salesman was confidential in nature and that the relationship between petitioner and
respondents CCBP and Taguibao was already strained.

To protect the employee's security of tenure, the Court has emphasized that the doctrine of
"strained relations" should be strictly applied so as not to deprive an illegally dismissed employee
of his right to reinstatement. Every labor dispute almost always results in "strained relations," and
the phrase cannot be given an overarching interpretation; otherwise, an unjustly dismissed
employee can never be reinstated.24 The assumption of strained relations was already debunked
by the fact that as early as March 2006 petitioner returned to work for respondent CCBP, without
any antagonism having been reported thus far by any of the parties. Neither can we sustain the
NLRC's conclusion that petitioner's position is confidential in nature. Receipt of proceeds from sales
of respondent CCBP's products does not make petitioner a confidential employee. A confidential
employee is one who (1) assists or acts in a confidential capacity, in regard to (2) persons who
formulate, determine, and effectuate management policies specifically in the field of labor
relations.25 Verily, petitioner's job as a salesman does not fall under this qualification.

Finally, the Court overrules the deletion by the NLRC of the Labor Arbiter's award for attorney's
fees to petitioner. Petitioner is evidently entitled to attorney's fees, since he was compelled to
litigate26 to protect his interest by reason of unjustified and unlawful termination of his
employment by respondents CCBP and Taguibao.