Fernandez v. Grolier International, Inc.
REVERSALFacts
The Antecedents: Petitioner Manuel L. Fernandez was employed by Grolier International, Inc. (Philippine branch) from July 1, 1964, eventually becoming Comptroller and Executive Administrator. On June 27, 1974, he left for Sydney, Australia, to work with Grolier Society, Ltd. of Australia from July 1, 1974, to February 3, 1975. He returned to Manila to follow up his immigration papers, which were denied in February 1975, with the denial becoming final in May 1976. Fernandez filed a complaint with the Ministry of Labor and Employment in August 1976. Procedural History: The public respondents dismissed Fernandez's complaint on the grounds of prescription and lack of jurisdiction. The Supreme Court initially affirmed this dismissal. The Petition: Petitioner filed a motion for reconsideration and a supplement thereto, arguing that his version of facts was the only one, that the dismissal on prescription was baseless, that prescription was never raised by the private respondent, that his work in Australia was under the same employment contract, that the ruling on prescription was absurd, and that Article 281 of the Labor Code was irrelevant.
Issue(s)
Whether the dismissal of the case on the ground of prescription was proper, and whether the issue of prescription was deemed waived by the private respondent. Whether petitioner's employment in Australia constituted a continuation of his Philippine employment, considering the issue of jurisdiction and the nature of employment. Whether petitioner resigned or was dismissed. Whether the dismissal of the petitioner was justified, considering the employment contract and separate juridical entities.
Ruling
The motion for reconsideration is GRANTED. The questioned order and resolution of the public respondents are REVERSED AND SET ASIDE. The private respondent is ordered to reinstate the petitioner with full backwages from February 3, 1975, but not to exceed three (3) years, without qualification or deduction. Should reinstatement be no longer possible, the private respondent is ordered to pay the petitioner separation pay based on the applicable law or company practice, whichever is higher, effective as of the end of the above three (3) year period. The private respondent is further ordered to reimburse the petitioner the amount of P6,646.65 as return fare from Sydney to Manila.
Ratio Decidendi
On the issue of prescription and waiver: The Court reiterated the rule that failure to specifically plead prescription in the position paper constitutes a waiver of the defense. While exceptions exist, the Court found that considerations of substantial justice favored resolving the case on its merits rather than strictly applying the rule on prescription, especially since the private respondent had waived the defense by not pleading it. The Court noted that the finding of prescription by the Labor Arbiter was not indubitable, as the petitioner's return to Manila was treated as a condition for immigration approval, and he remained an employee until May 1976 when his dismissal became final after the denial of his immigration bid. On the issue of jurisdiction and the nature of employment: The Court found that the private respondent's motion to dismiss was based solely on jurisdiction, with the affiant (Ronald Besaw) never presented as a witness. The petitioner argued that Grolier International, Inc. was an international corporation and that the Philippine and Australian offices were managed by the same person. The Court observed that the private respondent's version of facts was based on an affidavit of an unpresented witness, while the petitioner's evidence stood unchallenged. The Court highlighted that Mr. Besaw transferred Fernandez to Sydney, facilitated his travel under the guise of conferences, and continued to follow up his immigration papers even after his return to Manila, referring to him as an "executive in the Philippines." On whether petitioner resigned or was dismissed: The Court determined that the petitioner did not resign. It was highly unlikely that a Comptroller and Executive Administrator would voluntarily resign to take chances in a foreign country without assurance of continued employment at a higher income. No resignation papers were signed, and no reason for termination was apparent. The Court concluded that the petitioner's services were terminated when it became final that Australian authorities would not approve his transfer as an immigrant worker, not when he left for Australia or returned to Manila. On the employment contract and separate juridical entities: Although the Manila and Sydney offices were separately incorporated, the Court found they were marketing arms of the same multinational corporation, obeying unified management. The Philippine employment contract sufficed for Fernandez's seven months of work in Sydney. The Court noted that Fernandez traveled on a visitor's visa with "Employment Prohibited" stamped by Australian authorities, indicating he was not going as an immigrant but for company business. His expenses were shared, and his return fare was deducted from his salary after the company decided not to give him back his Philippine position, further supporting the conclusion that his employment continued until his dismissal.
Main Doctrine
The failure to plead prescription as a defense in the position paper constitutes a waiver of such defense, unless considerations of substantial justice necessitate its resolution on the merits. An employment abroad under a visitor's visa, facilitated by the employer and with continued communication and follow-up from the employer's Philippine branch, may be considered a continuation of the Philippine employment, and termination occurs when the employer decides not to reinstate the employee.