G.R. No. 232669 - Coca-Cola Femsa Philippines vs. Macapagal

The petitioner, Coca‑Cola Femsa Philippines, Inc., employed the thirteen respondents at its manufacturing plant in San Fernando City, Pampanga as part of its Product Availability Group (PAG).
The respondents held diverse positions including plant warehouse operation supervisor, transpo coordinator, auto-technicians, plant buyer, forklift operators, sales logistic coordinators, and sales office assistant.

In January 2011, the Company announced its decision to abolish the PAG, including its warehouses and all positions under it.
The redundancy program was part of a strategic decision to outsource the remaining functions of PAG to The Redsystem Company, Inc. (TRCI), stated to be an independent contractor, although respondents contended that TRCI is, in fact, a wholly‑owned subsidiary of the Company.
Termination letters were issued to the respondents, with separations effective March 1, 2011.
Respondents filed a complaint alleging illegal dismissal on the ground that the redundancy was executed in bad faith to undermine their security of tenure.

The Company notified both the respondents and the Department of Labor and Employment (DOLE) of the redundancy program, providing notices at least thirty days prior to the effective date.
In addition to the required separation pay and benefits, the Company provided additional separation packages.
Respondents executed notarized Deeds of Receipt, Waiver, and Quitclaim voluntarily after receiving more than the legally mandated benefits.
The Company expressed surprise when the respondents filed the illegal dismissal complaint almost two years after their separation.

The Labor Arbiter (LA) initially ruled in its Decision dated February 28, 2014, that the redundancy program was implemented in bad faith and declared the dismissal of the respondents illegal, ordering their reinstatement with full backwages and other benefits.
Dissatisfied, the Company appealed to the National Labor Relations Commission (NLRC), which in its Decision dated December 14, 2015 upheld the Company’s redundancy program as valid, asserting that it was undertaken in good faith as part of a cost-effective restructuring.
The respondents then obtained a favorable ruling from the Court of Appeals (CA) in its Decision dated December 12, 2016, which reversed the NLRC’s decision by reinstating the LA ruling; the CA criticized the Company for not providing fair and reasonable criteria in selecting which positions to abolish.
A subsequent motion for reconsideration was filed by the Company, but it was denied in a Resolution dated June 30, 2017.

Whether the Court of Appeals correctly reversed the NLRC’s ruling which upheld the validity of the redundancy program.
Whether the NLRC gravely abused its discretion in ruling that the redundancy program and the subsequent dismissals were valid, or if its decision was supported by substantial evidence and consistent with applicable law.