G.R. No. 92403 - Aquino vs. Civil Service Commission

Philippine Air Lines Inc. (PAL) is the petitioner and Philippine Air Lines Employees Association is the respondent.
The case arose from an order of the Court of Industrial Relations (CIR) dated February 12, 1959, which directed that back wages be computed for four dismissed employees pending execution.
This order followed a previous resolution issued by the CIR on July 22, 1954, in which PAL was ordered to reinstate Fortunato Biangco, Hernando Guevarra, Bernardino Abarrientos, and Onofre Grino with back pay from the date of their dismissal.
The resolution of reinstatement and back pay was upheld on appeal before this Tribunal in a decision promulgated on October 31, 1958 (G. R. No. L-8197).

After the CIR’s decision became final, the respondent Association filed a motion for partial execution requesting an order for PAL to deliver back wages computed over approximately 8 years and 7 to 8 months for the four employees.
The computed amounts were specific for each employee, totaling P158,485.33, based on their respective monthly wages.
In its affidavit, the Association adjusted the period of dismissal from May 5, 1950, to January 13, 1959, to account for back wages until their reinstatement on January 14, 1959.

PAL opposed the motion for partial execution, contending that any salaries or income earned by the dismissed employees during their period of lay-off should be deducted from their respective back wages.
PAL argued that allowing such deductions was consistent with prior decisions and should be factored in to minimize unjust enrichment.
The CIR, in an order rendered by Judge Martinez on February 12, 1959, directed the issuance of the writ of execution without deducting earnings received elsewhere.
A motion for reconsideration of this order was subsequently filed by PAL but was denied by the CIR en banc on May 22, 1959.

The petitioner referenced earlier cases and rulings from this Tribunal, where deductions were permitted in the computation of back wages if the dismissed employees had earned income during their lay-off.
The respondent maintained that the issue of deductions was not properly raised in the appellate proceedings before this Tribunal since the only matter on appeal in G. R. No. L-8197 pertained to the illegality of the dismissal and entitlement to back pay.
The respondent further argued that raising the deduction issue after final confirmation was untimely and equivalent to an indirect admission of the wrongful dismissal.

The interval between the dismissal (in 1950) and the eventual reinstatement (in 1959) spanned almost nine years, thereby increasing the amount of back wages at stake.
The petitioner’s stance is grounded on the principle that it is inequitable for an employee to benefit doubly by receiving full back pay along with any income earned by securing other employment during the lay-off period.
The decision reflects a broader judicial tendency to apply a rule mitigating damages and preventing unjust enrichment.

Whether the earnings or wages received by the four dismissed employees during their period of lay-off should be deducted from the computed back wages.

Is it procedurally proper to raise the question of wage deductions after the finality of the back pay decision?
Does allowing the deduction require modifying a judgment that has already become final and was not directly raised on appeal?

Can the principle of mitigating damages and preventing unjust enrichment be applied to the computation of back wages in this case?
Is the petitioner’s contention consistent with prior decisions and established labor jurisprudence?

The timeliness and admissibility of evidence regarding earnings during the lay-off

Should evidence of actual income earned during the lay-off be allowed now, notwithstanding earlier rulings on the finality of the dismissal issues?