What is the reckoning period for computing the amount of Backwages and separation pay in labor cases?
In G.R. No. 200490, the petitioner was adjudged liable for payment of Backwages and separation pay against Ma. Veronica, and the decisions became final and executory. The latter filed a motion for issuance of writ of execution, which the school opposed, instead it prayed for issuance of a certificate of satisfaction of judgment, alleging that their obligation had been satisfied by the release of the cash bond in the amount of P272,337.05 to Ma. Veronica. Ruling that the cash bond was insufficient to satisfy the judgment, which now amounted to P1,847,088.89. after its recomputation, the LA issued a writ of execution for the amount less P272,337.05, corresponding to the bond , or P1,575,751.84.
CICM appealed to the NLRC, which denied it. The CA also denied the petition for certiorari. Thus it interposed the present petition under Rule 45, on the question of “what should be the legal basis for the computation of the backwages and separation pay of an illegally dismissed employee in a case where reinstatement was not ordered despite appeals made by said employee which [delayed] the final resolution of the issue on reinstatement.” They argue that in the cases decided by the Court which ruled that Backwages and separation pay should be paid at the finality of the Court’s decision, were cases where the employers appealed the decision. In this case, it was the employee herself who appealed the decision. Thus computation of the Backwages and separation pay should have been reckoned from the time the Labor Arbiter rendered the decision and reinstatement was refused.
The Ruling:
The Court finds no merit in the petition.
To begin with, the petitioners failed to append the required affidavit of service. The rule is, such affidavit is essential to due process and the orderly administration of justice even if it is used merely as proof that service has been made on the other party. The utter disregard of this requirement as held in a catena of cases cannot be justified by harking to substantial justice and the policy of liberal construction of the Rules. Indeed, technical rules of procedure are not meant to frustrate the ends of justice. Rather, they serve to effect the proper and orderly disposition of cases and, thus, effectively prevent the clogging of court dockets. Thus, in Ferrer v. Villanueva,the Court held that petitioner’s failure to append the proof of service to his petition for certiorari was a fatal defect.
Hence, the denial of this case is in order.
For the guidance of the bench and the bar, however, the Court opts to also delve into the merits of the case.
As a precept, the Court’s duty in a Rule 45 petition, assailing the decision of the CA in a labor case elevated to it through a Rule 65 petition, is limited only to the determination of whether the CA committed an error in judgment in declaring the absence or existence, as the case may be, of grave abuse of discretion on the part of the NLRC.
As a consequence, the Court shall examine only whether the CA erred in not finding grave abuse of discretion when the NLRC affirmed the LA’s findings that the separation pay in lieu of reinstatement as well as backwages due to respondent should be recomputed until the finality of the Court’s decision in G.R. No. 200490, despite the fact that the delay in the resolution of the said case was brought about by respondent herself.
On this point, the Court rules in the negative.
Grave abuse of discretion, which has been defined as a capricious and whimsical exercise of judgment so patent and gross as to amount to an evasion of a positive duty or a virtual refusal to perform a duty enjoined by law, requires proof that the CA committed errors such that its decision was not made in contemplation of law. The burden of proof rests upon the party who asserts.
The petitioners, however, failed to carry out such burden.
The decision of the CA is based on long standing jurisprudence that in the event the aspect of reinstatement is disputed, backwages, including separation pay, shall be computed from the time of dismissal until the finality of the decision ordering the separation pay. In Gaco v. NLRC, it was ruled that with respect to the payment of backwages and separation pay in lieu of reinstatement of an illegally dismissed employee, the period shall be reckoned from the time compensation was withheld up to the finality of this Court’s decision. This was reiterated in Surima v. NLRC and Session Delights Ice Cream and Fast Foods v. CA.
The reason for this was explained in Bani Rural Bank, Inc. v. De Guzman. When there is an order of separation pay (in lieu of reinstatement or when the reinstatement aspect is waived or subsequently ordered in light of a supervening event making the award of reinstatement no longer possible), the employment relationship is terminated only upon the finality of the decision ordering the separation pay. The finality of the decision cuts-off the employment relationship and represents the final settlement of the rights and obligations of the parties against each other. Hence, backwages no longer accumulate upon the finality of the decision ordering the payment of separation pay because the employee is no longer entitled to any compensation from the employer by reason of the severance of his employment. One cannot, therefore, attribute patent error on the part of the CA when it merely affirmed the NLRC’s conclusion, which was clearly based on jurisprudence.
Plainly, it does not matter if the delay caused by an appeal was brought about by the employer or by the employee. The rule is, if the LA’s decision, which granted separation pay in lieu of reinstatement, is appealed by any party, the employer-employee relationship subsists and until such time when decision becomes final and executory, the employee is entitled to all the monetary awards awarded by the LA.
In this case, respondent remained an employee of the petitioners pending her partial appeal. Her employment was only severed when this Court, in G.R. No. 200490, affirmed with finality the rulings of the CA and the labor tribunals declaring her right to separation pay instead of actual reinstatement. Accordingly, she is entitled to have her backwages and separation pay computed until October 4, 2012, the date when the judgment of this Court became final and executory, as certified by the Clerk of Court, per the Entry of Judgment in G.R. No. 200490.
The Court would not have expected the CA and the NLRC to rule contrary to the above pronouncements. If it were otherwise, all employees who are similarly situated will be forced to relinquish early on their fight for reinstatement, a remedy, which the law prefers over severance of employment relation. Furthermore, to favor the petitioners’ position is nothing short of a derogation of the State’s policy to protect the rights of workers and their welfare under Article II, Section 8 of the 1987 Constitution.
The petitioners, nonetheless, claim that it was not their fault why the amounts due ballooned to the present level. They are mistaken. Suffice it to state that had they not illegally dismissed respondent, they will not be where they are today. They took the risk and must suffer the consequences.
Finally, the Court disagrees with the petitioners’ assertion that a recomputation would violate the doctrine of immutability of judgment. It has been settled that no essential change is made by a recomputation as this step is a necessary consequence that flows from the nature of the illegality of dismissal declared in that decision. By the nature of an illegal dismissal case, the reliefs continue to add on until full satisfaction thereof. The recomputation of the awards stemming from an illegal dismissal case does not constitute an alteration or amendment of the final decision being implemented. The illegal dismissal ruling stands; only the computation of the monetary consequences of the dismissal is affected and this is not a violation of the principle of immutability of final judgments.
WHEREFORE, the petition is DENIED. The Temporary Restraining Order issued by this Court on February 3, 2016 is hereby LIFTED.
SO ORDERED.
MENDOZA, J.:
Carpio, (Chairperson), Peralta, Leonen, and Jardeleza,* JJ., concur.
G.R. No. 220506, January 18, 2017, C.I.C.M. MISSION SEMINARIES (MARYHURST, MARYHEIGHTS, MARYSHORE AND MARYHILL) SCHOOL OF THEOLOGY, INC., FR. ROMEO NIMEZ, CICM, PETITIONERS, VS. MARIA VERONICA C. PEREZ, RESPONDENT.
Citations omitted