G.R. No. 212140-41 - Estrada vs. Office of the Ombudsman

Respondents—Jose B. Galandez, Domingo I. Sajuela, and Marlon D. Namoc—were employed by petitioner F.F. Cruz & Co., Inc., a company engaged in the construction business.
Their respective positions included roles such as warehouse personnel, purchaser, welder, and, as later noted in the CA Decision, head crew, attendant, and cashier.

In April and May 2011, the respondents were issued notices of termination on the ground of retirement.
The respondents contended that they had not yet reached the compulsory retirement age and that they were forced to retire without their consent, constituting illegal dismissal.
In response, the respondents initially filed a complaint before the Department of Labor and Employment (DOLE).

During conciliation meetings, petitioner agreed to pay the respondents separation pay equivalent to one (1) month for every year of service as a compromise.
When petitioner failed to honor its undertaking, DOLE referred the matter to the National Labor Relations Commission (NLRC).
Respondents then filed complaints for illegal dismissal with money claims against petitioner and its officers.

In a Decision dated December 15, 2011, the Labor Arbiter ruled in favor of the respondents and declared that they had been illegally dismissed, ordering their reinstatement without loss of seniority and awarding full monetary relief, including backwages, 13th month pay, and attorney’s fees.
Petitioner, dissatisfied with the ruling, appealed to the NLRC, which in a July 17, 2012 Decision, affirmed the Labor Arbiter’s ruling and computed the award of backwages and attorney’s fees.
Petitioner’s subsequent motion for reconsideration was denied in a Resolution dated September 21, 2012.

In February and March 2013, respondents sought to enforce the NLRC Decision by demanding reinstatement and the payment of their full backwages, computed as of January 2013, along with a proposal to receive separation pay if reinstatement was no longer possible.
On March 25, 2013, petitioner partially settled the monetary aspect of the award by paying the computed sums and secured a Quitclaim and Release from the respondents, in which they acknowledged receipt of the said amount.
Believing that full settlement had been achieved, petitioner filed a Manifestation on April 4, 2013 with the NLRC requesting that the case be declared closed and terminated.
The NLRC, in an Order dated April 30, 2013, approved the quitclaims and declared the case closed, interpreting the settlement as full satisfaction of the award as embodied in its previous Decision.

The respondents later moved for reconsideration, arguing that they were not assisted by counsel when executing the quitclaims, that they were defrauded into believing the quitclaim guaranteed their reinstatement, and that they were induced to believe an arrangement was in place that obviated the need to consult their lawyer.
Petitioner countered by asserting that the respondents executed the quitclaim voluntarily, with full understanding of its nature and consequences, thereby effectively waiving any additional claims beyond the settled monetary award.
Subsequently, in a Resolution dated March 31, 2014, the NLRC denied the respondents’ motion for reconsideration, ruling the quitclaims valid and holding that the respondents’ acceptance of the monetary award discharged petitioner from any further obligations.

The respondents elevated the matter to the CA by petitioning for certiorari, contending that the NLRC gravely abused its discretion in approving the quitclaims and ruling that they constituted full settlement of all claims, including the non-monetary reinstatement aspect.
In a CA Decision dated February 8, 2017, the court set aside the NLRC Order and Resolution.
The CA held that although the quitclaims were valid in settling the monetary aspect, they did not bar the respondents from asserting the legally due reinstatement and the consequent accrual of backwages or, if reinstatement was no longer viable, the payment of separation pay.
After both parties moved for reconsideration, the CA in a Resolution dated January 4, 2018, held that the settlement award was unconscionable given that the respondents received far less than what was legally required, particularly with respect to the reinstatement aspect.

Whether the Court of Appeals erred in holding that the quitclaims and releases, though valid for the monetary settlement, did not bar the respondents from asserting their rights to reinstatement (or separation pay in lieu thereof).
Whether the CA committed reversible error in ordering the remand of the case to the NLRC for re-computation of the respondents’ backwages until their actual reinstatement, or alternatively, inclusion of separation pay if reinstatement was no longer viable.