Eastern Shipping Lines v. Canja
REITERATIONFacts
The Antecedents: Respondent Julio C. Canja filed a complaint against petitioners Eastern Shipping Lines, Inc. (ESLI) and its president, Congressman Erwin L. Chiongbian, for illegal dismissal, illegal suspension, and non-payment of various benefits. Canja alleged he was hired by ESLI in February 1982 as a maintenance worker but was also made to work at Congressman Chiongbian's residence and resort. He claimed that in April 2008, he was instructed not to report for work during the family's vacation abroad and was later told to stop reporting permanently upon their return due to a supposed lack of available work. Petitioners, however, denied dismissing Canja, asserting that he was the one who refused to return to work and that he still owed them money from loans and cash advances. Procedural History: The Labor Arbiter ruled in favor of Canja, finding him illegally dismissed and ordering payment of backwages and separation pay. The National Labor Relations Commission (NLRC) affirmed this decision, dismissing petitioners' defense of abandonment for lack of evidence. Petitioners appealed to the Court of Appeals (CA) via a Petition for Certiorari, alleging grave abuse of discretion by the NLRC. The CA initially denied their prayer for a temporary restraining order. Subsequently, the NLRC decision became final and executory. However, the CA, in its Decision dated July 20, 2010, affirmed the NLRC resolutions with modification, increasing the separation pay and backwages to be computed up to the finality of its decision. The CA denied petitioners' motion for reconsideration in a Resolution dated October 7, 2010. The Petition: Petitioners filed a Petition for Review on Certiorari under Rule 45 of the Rules of Court, seeking to reverse the CA's decision and resolution. They argued that the CA erred in modifying the NLRC decision, which had already become final and executory with an entry of judgment. The core of their argument was that a final and executory judgment could no longer be modified. The Supreme Court, however, disagreed, holding that the CA correctly exercised its jurisdiction as the petition for certiorari was filed within the reglementary period under Rule 65 of the Rules of Court, thus the NLRC decision had not yet attained finality when the CA reviewed it. The Court affirmed the CA's modification of backwages and separation pay, citing relevant jurisprudence.
Issue(s)
Whether the Court of Appeals erred in modifying the National Labor Relations Commission's Resolution dated November 29, 2009, on the basis of a new Supreme Court case, despite the NLRC decision having already become final and executory; specifically, whether the petition for certiorari was timely. Whether the Court of Appeals erred in affirming the modification of the payment of separation pay and backwages, and the substantive issues of illegal dismissal, backwages, and separation pay.
Ruling
The petition is DENIED. The Decision dated July 20, 2010, and the Resolution dated October 7, 2010, of the Court of Appeals in CA-G.R. SP No. 112756 are AFFIRMED with MODIFICATION. Petitioners are ORDERED to PAY respondent Julio C. Canja backwages computed from the date of illegal dismissal until the finality of the Decision, separation pay equivalent to one (1) month salary for every year of service until the finality of the Decision, and legal interest of six percent (6%) per annum on the total monetary awards computed from the finality of this Decision until their full satisfaction. The Labor Arbiter is ordered to recompute.
Ratio Decidendi
On the timeliness of the petition for certiorari and the finality of the NLRC decision: The Supreme Court held that a petition for certiorari is not rendered moot by the mere fact that an NLRC decision has become final and executory. The Court clarified that while NLRC decisions become final and executory after ten calendar days from receipt, judicial review via a petition for certiorari under Rule 65 of the Rules of Court allows for a 60-day period from notice of the assailed order or resolution. In this case, the petition for certiorari was filed within the 60-day period from receipt of the denial of the motion for reconsideration, making it timely. Therefore, the Court of Appeals could still grant the petition and modify, nullify, or reverse the NLRC decision. The issuance of an entry of judgment by the NLRC does not render a timely petition for certiorari moot and academic, as the filing of the petition within the reglementary period under Rule 65 tolls the finality of the NLRC decision for purposes of judicial review. On the substantive issues of illegal dismissal, backwages, and separation pay: The Supreme Court stated that it would no longer delve into the substantive merits as they were not raised as an issue in the instant petition. However, it affirmed the appellate court's modification of the payment of separation pay and backwages. The Court reiterated that an employee illegally dismissed is entitled to backwages and reinstatement, or separation pay in lieu of reinstatement when the latter is no longer viable due to strained relations. The Court found the appellate court's computation of backwages and separation pay consistent with Article 279 of the Labor Code and jurisprudence. Specifically, it noted that separation pay equivalent to one month's salary for every year of service should be awarded as an alternative when reinstatement is not viable, and this payment is in addition to backwages. The NLRC's award of separation pay at one-half month pay per year of service was deemed to have no basis.
Main Doctrine
A petition for certiorari filed within the 60-day reglementary period under Rule 65 of the Rules of Court is timely, even if the NLRC decision had already become final and executory under the NLRC Rules of Procedure, as the filing of the certiorari petition tolls the finality of the NLRC decision for purposes of judicial review.