G.R. No. 123936 - Soriano vs. Court of Appeals

Respondents were employed by Holy Face Cell Corporation (the Corporation) at Tres Pares Fast Food as cooks, cashiers, or dishwashers.
Petitioner Hayden Kho, Sr. (Kho) and his wife, Irene S. Kho (collectively Spouses Kho), were stockholders of the Corporation, with Kho alleged to be its President/Manager.

On January 14, 2011, Sheryl Kho, daughter of Spouses Kho, posted a notice in the company premises that the restaurant would close on January 19, 2011.
Respondents attempted to seek an audience with Kho regarding the impending closure but were unsuccessful.
The restaurant closed as scheduled on January 19, 2011.

Respondents filed a complaint for illegal dismissal against the Corporation, Tres Pares, and the Spouses Kho before the Labor Arbiter (LA), claiming separation pay, salary differentials, nominal damages, overtime pay, service incentive leave pay, holiday pay, and attorney’s fees.
The Spouses Kho denied any employer-employee relationship with respondents, asserting the Corporation’s separate juridical personality and refuting solidary liability.
The LA ruled in favor of respondents on November 9, 2011, ordering the Corporation and Kho to pay separation pay, salary and 13th month pay differentials, nominal damages, and attorney’s fees amounting to Php 3,254,466.60 as solidary obligors.
The LA found that the Corporation failed to substantiate its claim of financial distress and did not comply with the one-month written notice requirement under Article 298 of the Labor Code.
Kho’s alleged position as President at the time of closure was accepted by the LA based on respondents’ allegations and Kho’s failure to deny it.

Kho appealed to the National Labor Relations Commission (NLRC), contesting solidary liability.
On May 7, 2015, the NLRC reversed the LA’s Decision and dismissed the complaint against Kho, holding that respondents failed to allege or prove bad faith or unlawful acts justifying piercing the corporate veil.
The NLRC noted that the Corporation’s General Information Sheet (GIS) listed "Domingo M. Ifurung" as President, not Kho.
Respondents’ motion for reconsideration was denied on June 16, 2015.
Respondents filed a petition for certiorari before the Court of Appeals (CA).
On July 19, 2017, the CA reversed the NLRC, reinstating the LA ruling and holding Kho solidarily liable with the Corporation for separation pay, nominal damages of Php 50,000 each, and attorney’s fees.
The CA reasoned Kho managed the Corporation, his daughter posted the closure notice, and respondents sought audience with him, concluding he acted in bad faith by assenting to the sudden closure without board authorization, hence solidary liability was proper.
Kho’s motion for reconsideration to the CA was denied on January 4, 2018.

Kho filed the present petition for review on certiorari to the Supreme Court, assailing the CA’s rulings on the ground of grave abuse of discretion by the NLRC in dismissing respondents’ complaint against him and holding him solidarily liable with the Corporation.

Whether the Court of Appeals correctly found grave abuse of discretion on the part of the NLRC and properly held petitioner Hayden Kho, Sr. solidarily liable with the Corporation for respondents’ monetary claims arising from illegal dismissal and related labor benefits.