Case Digest (G.R. No. 194467)
Facts:
The case at hand involves Melchor A. Cuadra, Melencio Trinidad, and Serafin Trinidad (petitioners) against San Miguel Corporation (respondent), and was decided on July 13, 2020. The origins of this dispute trace back to an illegal dismissal case filed by the petitioners, along with 60 other complainants, against Lippercon Services, Inc. and San Miguel Corporation on January 4, 1991. During the proceedings before the National Labor Relations Commission (NLRC), the majority of complainants settled with San Miguel. However, on December 15, 1994, Labor Arbiter Manual R. Caday ruled that the remaining nine complainants, including Cuadra, Melencio, and Serafin, were regular employees of San Miguel. Caday characterized Lippercon as a mere labor-only contractor and ordered their reinstatement as regular employees effective from the decision date, along with backwages for a maximum of three years.Subsequently, an appeal by San Miguel before the NLRC led to a resolution on May 31, 1995,
Case Digest (G.R. No. 194467)
Facts:
- Parties and Background
- Petitioners: Melchor A. Cuadra, Melencio Trinidad, and Serafin Trinidad filed an illegal dismissal case against San Miguel Corporation (SMC).
- Respondent: San Miguel Corporation, alleged as the true employer, with issues involving its labor-only contractor, Lippercon Services, Inc.
- Chronology of Proceedings
- Initial Filing and Early Developments
- On January 4, 1991, 60 complainants, including the petitioners, filed an illegal dismissal case before the National Labor Relations Commission (NLRC) against both Lippercon Services and SMC.
- During the pendency of the NLRC proceedings, 51 complainants settled amicably with SMC, leaving nine cases to proceed.
- Labor Arbiter Decision
- In a December 15, 1994 decision by Labor Arbiter Caday, the remaining nine complainants were declared as regular employees of SMC.
- The decision characterized Lippercon Services as a labor-only contractor and mandated SMC to reinstate the complainants with backwages for up to three years, along with applicable wage increases.
- NLRC and Court of Appeals Rulings
- On May 31, 1995, the NLRC modified the Labor Arbiter’s decision by deleting the award of reinstatement with one year’s backwages and ordering instead the payment of separation pay computed at one month salary per year of service (with specific rules for the computation).
- The Court of Appeals, in a series of resolutions (April 12, 1999; October 14, 1999; November 8, 2010), affirmed with modifications the NLRC decisions, including ordering reinstatement and setting the reckoning date of service as of December 15, 1994.
- Execution and Compromise
- A Writ of Execution was issued on September 1, 2000, for reinstatement at SMC’s designated location.
- During execution, the parties entered into a compromise agreement wherein each of the petitioners (Melchor, Melencio, and Serafin) received Php 550,000.00 as “full, complete, absolute, and final settlement and satisfaction” of their money claims and benefits.
- Labor Arbiter Macam approved the compromise in his June 25, 2003 order, which also ordered that the petitioners be reinstated effective July 1, 2003.
- Despite reinstatement, SMC reckoned the employment date from July 1, 2003, effectively treating the petitioners as new hires.
- The Grievance on Length of Service
- The sole issue that emerged was the proper reckoning of the petitioners’ length of service for purposes of benefits computation, particularly whether service should be computed from their original hiring dates (1985 for Melchor and 1988 for Melencio and Serafin) or from later dates such as December 15, 1994 or July 1, 2003.
- Petitioners contended that reinstatement did not reset their service, arguing that their continuous employment should be recognized from the date they were first hired by SMC.
- SMC, on the other hand, maintained that due to the compromise and the nature of the reinstatement (with different job assignments), the petitioners became new hires with their service reckoned from July 1, 2003.
- Subsequent Litigation and Developments
- Voluntary Arbitration
- Petitioners raised the issue before the Office of the Voluntary Arbitrator of the National Conciliation and Mediation Board, where Voluntary Arbitrator Angel A. Ancheta ruled in their favor.
- Ancheta held that since the petitioners were to be reinstated to their original positions, their length of service must be reckoned from their initial dates of employment (1985 for Melchor and 1988 for Melencio and Serafin).
- The decision emphasized that reinstatement, unlike re-hiring, does not constitute a new employment relationship.
- Court of Appeals Reconsideration
- The Court of Appeals modified the Voluntary Arbitrator’s decision by maintaining that the service should be reckoned from December 15, 1994, the date they were declared as regular employees under Labor Arbiter Caday’s decision.
- Petitioners filed a Motion for Partial Reconsideration to argue that their continuous service should not be disrupted by the later declaration of regularity.
- Petition for Review on Certiorari
- Finally, petitioners filed a Petition for Review on Certiorari, asserting that the true reckoning of their service should be from their actual start dates with SMC.
- The proceedings involved further submissions, including memoranda and manifestations from both parties regarding subsequent developments and the execution of a quitclaim.
- Resolution on Petition’s Merits
- The issue of petitioners’ length of service remained the central point, with the court having to determine whether the service should be continuous (starting from 1985/1988) due to reinstatement or reset (from the later dates) as in cases of re-hiring.
- For petitioner Serafin, his separate waiver and the subsequent settlement rendered his issue moot and academic.
Issues:
- Proper Reckoning of Length of Service
- Should the petitioners’ length of service be computed from the date they were first employed by SMC (i.e., 1985 for Melchor and 1988 for Melencio and Serafin) as argued by petitioners?
- Or should it be reckoned from December 15, 1994 – the date when they were declared regular employees, as maintained by SMC and upheld by parts of the Court of Appeals’ decisions?
- Distinction Between Reinstatement and New Hire
- Is reinstatement under an order due to illegal dismissal equivalent to re-hiring, implying a reset in the length of service?
- Does the fact that the petitioners were given new positions on July 1, 2003 constitute a new employment relationship, thus justifying a later reckoning date?
- Impact of the Compromise Agreement and Quitclaim
- Does the compromise agreement and the executed quitclaim – which included receipt of Php 550,000.00 – indicate that separation pay was given and therefore imply that the petitioners were re-hired?
- Or does the absence of any express provision in the quitclaim regarding separation pay support the argument for continuous service from the original employment date?
- For Petitioner Serafin
- Given his waiver of claims through the executed Release, Waiver, and Quitclaim, does his issue become moot and academic?
- Precedent and Statutory Considerations
- How do prior rulings (e.g., Carandang, Sta. Catalina Colleges, Philippine Village Hotel) influence the determination of the proper reckoning date of service?
- What is the correct application of the presumption of continuity of service under Philippine labor jurisprudence?
Ruling:
- (Subscriber-Only)
Ratio:
- (Subscriber-Only)
Doctrine:
- (Subscriber-Only)