Olvido v. Court of Appeals
REITERATIONFacts
The Antecedents: Petitioners were regular employees of Sicaltek Manufacturing, Inc. Some of them also held positions within the Sicaltek Employees Union-ADFLO (SEU-ADFLO). The petitioners initiated a complaint against the company for various labor infractions, including illegal lay-off, illegal deductions, and non-payment of wages and benefits. Concurrently, SEU-ADFLO filed a petition for certification election. An agreement was reached where SEU-ADFLO would withdraw the labor complaint in exchange for the company's voluntary recognition as the sole bargaining agent. Subsequently, the petitioners disaffiliated from SEU-ADFLO, formed a new union (Sicaltek Workers Union - SWU), and filed their own petition for certification election, which was dismissed. Sicaltek and SEU-ADFLO then concluded a new Collective Bargaining Agreement (CBA), which included a Modified Union Shop provision. SEU-ADFLO demanded the dismissal of the petitioners based on this provision, citing falsification and disloyalty. Sicaltek issued show-cause letters, and subsequently dismissed the petitioners, who then filed a new complaint for unfair labor practice and illegal dismissal. Procedural History: The Labor Arbiter initially dismissed the petitioners' complaint for unfair labor practice and illegal dismissal. Upon appeal, the National Labor Relations Commission (NLRC) reversed the Labor Arbiter's decision, ordering the reinstatement of the petitioners but without backwages. Both the petitioners and the company filed separate petitions with the Supreme Court. The case was then referred to the Court of Appeals (CA) pursuant to St. Martin Funeral Home v. NLRC. The CA, in its decision dated May 19, 1999, and resolution dated December 9, 1999, denied due course and dismissed the consolidated petitions. The CA ruled that the petitioners were not covered by the Modified Union Shop provision of the CBA but found that their dismissal was not in bad faith, thus denying backwages. The Petition: The petitioners seek a review on certiorari of the Court of Appeals' decision and resolution. They argue that the CA erred in ruling that they are not entitled to backwages, despite the finding that their dismissal was illegal. The sole issue presented to the Supreme Court is whether the petitioners are entitled to backwages. The petitioners contend that their dismissal was effected in bad faith, entitling them to full backwages. The Supreme Court, in its decision, granted the petition, modifying the CA's ruling. It held that an employee unjustly dismissed is entitled to full backwages, inclusive of allowances and other benefits, computed from the time of illegal dismissal up to actual reinstatement, in accordance with Article 279 of the Labor Code, as amended by Republic Act No. 6715. The case was remanded to the Labor Arbiter for the computation of the full backwages due to the petitioners.
Issue(s)
Whether petitioners are entitled to backwages despite the Court of Appeals' finding that their dismissal was not attended by bad faith. Whether the petitioners were covered by the Modified Union Shop Provision in the CBA.
Ruling
The petition is GRANTED. The Decision dated May 19, 1999, and the Resolution dated December 9, 1999, of the Court of Appeals are MODIFIED. Petitioners are awarded full backwages and other allowances, without qualifications and diminutions, computed from the time they were illegally dismissed up to the time they are actually reinstated. The case is remanded to the Labor Arbiter for proper computation of the full backwages due petitioners.
Ratio Decidendi
On the issue of whether petitioners are entitled to backwages: The Court ruled that petitioners are entitled to full backwages. It clarified that the jurisprudential rule that an employer is not guilty of unfair labor practice if it merely complied in good faith with a union's request for dismissal pursuant to a union security clause, and thus may not be ordered to grant backwages, is inconsistent with Article 279 of the Labor Code, as amended by Republic Act No. 6715. This provision mandates that an employee who is unjustly dismissed is entitled to reinstatement without loss of seniority rights and other privileges, and to his full backwages, inclusive of allowances and other benefits, computed from the time his compensation was withheld up to the time of his actual reinstatement. Therefore, where reinstatement is adjudged, the award of backwages extends up to the time the order of reinstatement is actually carried out. The Court found that the dismissal was illegal, and thus, the entitlement to full backwages follows. On the issue of whether petitioners were covered by the Modified Union Shop Provision: The Court affirmed the Court of Appeals' finding that petitioners were not covered by the Modified Union Shop provision in the CBA. The provision required new employees to join the union after some time but did not obligate present employees to join. At the time the CBA was signed on October 10, 1992, petitioners were already regular employees and had already formed and joined SWU as of September 17, 1992. Consequently, they could not be compelled to become members of SEU-ADFLO under the Modified Union Shop provision after the CBA was signed, and their dismissal on grounds of disloyalty or disaffiliation was illegal. The Court noted that Sicaltek did not assail this finding, making it final.
Main Doctrine
An employee who is unjustly dismissed from work is entitled to reinstatement without loss of seniority rights and other privileges, and to full backwages, inclusive of allowances and other benefits, computed from the time compensation was withheld up to the time of actual reinstatement, as provided under Article 279 of the Labor Code, as amended by Republic Act No. 6715.