Texon Manufacturing v. Millena
REITERATIONFacts
The Antecedents: Respondents Grace and Marilyn Millena were employed by petitioner Texon Manufacturing. Grace Millena was terminated in the summer of 1995, prompting her to file a complaint for money claims (underpayment and non-payment of wages, overtime and holiday pay) on August 21, 1995. Marilyn Millena was terminated on September 8, 1995. Upon going to collect her salary the next day, she was offered ₱1,500.00 as business capital and was asked to sign a blank paper, which she believed was a receipt. It turned out to be a resignation letter and quitclaim. She filed a complaint for illegal dismissal with prayer for backwages and benefits on September 11, 1995. The two cases were consolidated. Procedural History: Petitioners filed a motion to dismiss both complaints on the ground of prescription, which was denied by the Labor Arbiter. The NLRC dismissed petitioners' appeal and denied their motion for reconsideration. Petitioners then filed a petition for certiorari with the Court of Appeals, which affirmed the NLRC's decision. The Court of Appeals denied petitioners' motion for reconsideration. The Petition: Petitioners seek review of the Court of Appeals' decision, arguing that the respondents' money claims had prescribed and that their appeal to the NLRC should have been sustained.
Issue(s)
Whether respondents' money claims have prescribed; whether Marilyn Millena's action for illegal dismissal has prescribed. Whether the Court of Appeals erred in affirming the NLRC's dismissal of petitioners' appeal from the Labor Arbiter's order denying the motion to dismiss.
Ruling
The petition is denied. The assailed Decision and Resolution of the Court of Appeals are affirmed. The case is remanded to the Labor Arbiter for further proceedings.
Ratio Decidendi
On the issue of prescription for money claims (Grace Millena): The Court reiterated that under Article 291 of the Labor Code, money claims arising from employer-employee relations must be filed within three (3) years from the time the cause of action accrued. The Court disagreed with petitioners' contention that the cause of action accrued in 1991 or 1992. Instead, it held that the cause of action accrued in 1995, upon Grace Millena's termination, as it was only then that she decided to file her complaint. Since her complaint was filed on August 21, 1995, barely three months after her termination in the summer of 1995, it was seasonably filed within the three-year prescriptive period. On the issue of prescription for illegal dismissal (Marilyn Millena): The Court applied Article 1146 of the New Civil Code, which provides a four-year prescriptive period for actions based upon an injury to the rights of the plaintiff. Citing Callanta vs. Carnation Philippines, Inc., the Court held that wrongful interference with one's employment constitutes an injury to rights. Marilyn Millena's complaint for illegal dismissal was filed on September 11, 1995, only three days after her termination on September 8, 1995. This was well within the four-year prescriptive period provided by Article 1146 of the Civil Code. On the appealability of the denial of the motion to dismiss: The Court affirmed the ruling that an order denying a motion to dismiss is interlocutory and, therefore, not appealable until a final judgment on the merits is rendered. This is in accordance with Section 3, Rule V of the NLRC Rules of Procedure. The Court agreed with the Solicitor General that Article 223 of the Labor Code, which pertains to appeals, contemplates final and executory decisions, awards, or orders, not interlocutory ones like the denial of a motion to dismiss. The denial of the motion to dismiss did not terminate the proceedings, as further steps like filing an answer and subsequent proceedings were still required.
Main Doctrine
The prescriptive period for money claims arising from employer-employee relations is three (3) years from the time the cause of action accrued, as provided by Article 291 of the Labor Code. An action for illegal dismissal, however, is considered an injury to the rights of the plaintiff and must be filed within four (4) years from the time of dismissal, as provided by Article 1146 of the New Civil Code. An order denying a motion to dismiss is interlocutory and not appealable until a final judgment on the merits is rendered.