Shin I Industrial (Phil.) v. National Labor Relations Commission
REITERATIONFacts
The Antecedents: Private respondents were employees of Kwong Wah Metal (Philippines), Inc. In May 1984, a strike occurred, but private respondents did not participate. In August 1984, Kwong Wah Metal entered into a lease purchase agreement with petitioner Shin I Industrial (Phil.), wherein petitioner would take over the operation of the factory starting September 1984. Prior to this, Kwong Wah Metal and petitioner entered into a compromise agreement regarding a pending labor case. Private respondents applied for work with petitioner, were accepted as they did not join the strike, and began working on September 29, 1984. After receiving their salaries, private respondents demanded a wage increase, which petitioner denied, leading to their dismissal. Private respondents filed a complaint for illegal dismissal. Procedural History: The Labor Arbiter ruled in favor of the private respondents, ordering petitioner and Kwong Wah Metal to pay them basic pay, living allowance, incentive pay, actual damages, moral damages, exemplary damages, and attorney's fees. Petitioner appealed to the National Labor Relations Commission (NLRC). The NLRC modified the decision by deleting the award of moral and exemplary damages. The Petition: Petitioner assails the NLRC decision, contending that it committed a serious error in holding petitioner liable for the dismissal, arguing that it has a separate corporate personality from Kwong Wah Metal and that the ownership of the two companies by the same spouses does not necessarily make them one and the same. Petitioner also argues that private respondents abandoned their work.
Issue(s)
Whether petitioner can be held liable for the dismissal of private respondents. Whether the private respondents abandoned their work.
Ruling
The petition is devoid of merit. The NLRC's finding that private respondents were illegally dismissed by petitioner is affirmed, with the modification of deleting the award for actual damages. The resolution of the NLRC, as modified, is affirmed.
Ratio Decidendi
On whether petitioner can be held liable for the dismissal of private respondents: The Court affirmed the NLRC's finding that the private respondents were illegally dismissed by the petitioner. The NLRC found that the dismissal was effectuated verbally without prior notice after the private respondents inquired about their wages. This factual finding, supported by substantial evidence, is binding on the Supreme Court. The Court further held that the alleged issue of whether petitioner corporation or Kwong Wah Corporation is owned by the same persons is of no material consequence. Since it was established that petitioner re-employed the private respondents and subsequently dismissed them illegally, petitioner must bear the consequences of such dismissal. The principle of separate corporate personality does not shield a company from liability when it directly engages in and perpetrates an illegal act, such as the unlawful termination of employees it has re-hired. On whether the private respondents abandoned their work: The Court rejected petitioner's theory that private respondents abandoned their work. Abandonment of position is a matter of intention and requires overt acts demonstrating a clear intent to sever the employment relationship. Such intent cannot be lightly inferred or presumed from equivocal acts. In this case, the private respondents' actions demonstrated the opposite of abandonment: they continued to work even during the strike, applied for re-employment with the petitioner, and promptly filed a complaint for illegal dismissal when terminated without notice. Their continued employment and subsequent action to seek redress negate any claim of abandonment.
Main Doctrine
A corporation that re-employs workers from a previous corporation, even if it has a separate corporate personality, is liable for the illegal dismissal of those re-employed workers if the dismissal is found to be without just cause and proper notice.