Facts:

The case involves Golden Thread Knitting Industries, Inc., along with its officers George Ng and Wilfredo Bico, as petitioners against several employees, namely George Macaspac, Mary Ann Macaspac, Romulo Albasin, Melchor Cachucha, Gilbert Rivera, and Flora Balbino, as respondents. The events leading to the case began on July 16, 1992, when multiple complaints were filed against the petitioners by their employees, alleging unfair labor practices, illegal dismissals, and various wage-related claims. The complaints were filed in four separate instances: the first on July 16, 1992, by Gilbert Rivera and others for unfair labor practices and illegal dismissals; the second on July 22, 1992, by Flora Balbino and others for similar claims; the third on August 24, 1992, by Deogracias Balingit for unfair labor practices; and the fourth on September 2, 1992, by Gilbert Rivera and Mary Ann Macaspac for unfair labor practices and illegal dismissal.

The employees claimed that they organ...

Facts:

Background of the Case:

• From 16 July to 2 September 1992, four separate complaints were filed by employees of Golden Thread Knitting Industries, Inc. against the company and its officers, George Ng and Wilfredo Bico.
• The complaints included allegations of unfair labor practice, illegal dismissal, overtime pay, premium pay, holiday pay, and illegal rotation of work.

Union Formation and Retaliation:

• In May 1992, the employees organized a labor union. Shortly after, Cristina Balingit, the wife of the union chairman, was dismissed. The union chairman, Deogracias Balingit, was suspended, and the working days of union officers and members were reduced from six to three days a week.
• On 1 July 1992, the union filed a petition for certification election. Subsequently, union members Romulo Albasin, Melchor Cachucha, and George Macaspac were barred from entering the company premises. Flora Balbino was suspended and later terminated, and Gilbert Rivera and Mary Ann Macaspac were dismissed.

Petitioners' Defense:

• Petitioners claimed that the reduction in working days and dismissals were due to low demand for their products and valid causes such as misconduct, redundancy, and violation of company rules.
• They alleged that Romulo Albasin and George Macaspac slashed company towels, Gilbert Rivera and Mary Ann Macaspac were dismissed due to redundancy, and Flora Balbino was dismissed for threatening the personnel manager and violating company rules.

Labor Arbiter's Decision:

• The Labor Arbiter ruled that the reduction of working days and dismissals were not retaliatory and were justified by the company's financial situation. However, Gilbert Rivera and Mary Ann Macaspac were awarded separation pay, and Flora Balbino was awarded unpaid wages.

NLRC's Decision:

• The NLRC reversed the Labor Arbiter's decision, finding that the dismissals of George Macaspac, Mary Ann Macaspac, Romulo Albasin, Melchor Cachucha, Gilbert Rivera, and Flora Balbino were illegal. The NLRC ordered their reinstatement with full back wages and awarded holiday pay for 1990, 1991, and 1992.

Issue:

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Ruling:

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Ratio:

1. Illegal Dismissal:

   • The Court found that the dismissals were not supported by sufficient evidence. The allegations of misconduct against Romulo Albasin and George Macaspac were not substantiated, and the company failed to provide them with due process.
   • The redundancy claim for Gilbert Rivera and Mary Ann Macaspac was not supported by adequate proof, and the company failed to follow the required procedures for redundancy dismissals.
   • Flora Balbino's dismissal was deemed excessive, as her actions were provoked by an unjustified suspension.

2. Holiday Pay:

   • The Court upheld the NLRC's award of holiday pay for the years 1990, 1991, and 1992, as the employees' claims were undisputed.

3. Procedural Due Process:

   • The Court emphasized that employers must follow procedural due process in dismissing employees, including providing notice and an opportunity to be heard. The failure to do so renders the dismissal illegal.

4. Management Prerogative:

   • While employers have the prerogative to manage their business, this must be exercised in good faith and with due regard to the rights of employees. Arbitrary or malicious actions will not be upheld.

Conclusion:

The Supreme Court affirmed the NLRC's decision, ordering the reinstatement of the dismissed employees with full back wages and awarding holiday pay. The Court modified the ruling regarding Flora Balbino, reducing her penalty to a one-week suspension. The case underscores the importance of procedural due process and the need for employers to provide sufficient evidence to justify dismissals.