G.R. No. 168208 - Ramirez vs. Mar Fishing Co., Inc.

On 28 June 2001, respondent Mar Fishing Co., Inc. (Mar Fishing), engaged in fishing and tuna canning, sold its principal assets to co-respondent Miramar Fishing Co., Inc. (Miramar) through a public bidding.
The proceeds from the sale were paid to the Trade and Investment Corporation of the Philippines (TIDCORP) to settle Mar Fishing’s outstanding obligation amounting to ₱897,560,041.26.
Following the asset sale, Mar Fishing issued a memorandum dated 23 October 2001 informing its workers of the company’s impending closure by the end of that month.
On 29 October 2001, merely two days before the end of October, Mar Fishing formally notified the Department of Labor and Employment (DOLE) of its business closure.

After the sale and prior to closure, Mar Fishing’s labor union, Mar Fishing Workers Union a/n NFL, and Miramar entered into a Memorandum of Agreement.
The Agreement stipulated that Miramar would absorb Mar Fishing’s regular rank-and-file employees whose performance was satisfactory, ensuring their seniority rights and privileges remained intact.
Petitioners, who were rank-and-file employees, were neither hired nor provided separation pay by Miramar.
As a result, petitioners filed Complaints for illegal dismissal with money claims before the Arbitration Branch of the National Labor Relations Commission (NLRC).

The Labor Arbiter (LA) issued a decision on 30 July 2002 finding that the closure of Mar Fishing was necessary due to the sale of its tuna canning plant and that the dismissals were for an authorized cause.
Despite finding the dismissals legal based on the authorized closure, the LA ordered Mar Fishing to pay separation pay to the employees.
The LA’s ruling included: (a) payment of separation pay computed at ₱6,336,587.77; (b) dismissal of cases against Miramar Fishing Co., Inc. and other individual respondents for lack of cause; and (c) dismissal of remaining charges as lacking merit.
Petitioners challenged the LA’s decision by filing an action before the NLRC. The NLRC modified the LA’s decision, awarding not only separation pay but also full back wages from termination (31 October 2001) until 30 July 2002, and initially finding solidary liability between Mar Fishing and Miramar by piercing the corporate veil.

On reconsideration, the NLRC modified its ruling, imposing liability solely on Mar Fishing. It held that petitioners had no cause of action against Miramar because labor contracts are not enforceable against the transferee absent an explicit stipulation assuming the transferor’s obligations.
Petitioners then filed a Rule 65 Petition before the Court of Appeals (CA) arguing that both Mar Fishing and Miramar should be held liable, and that back wages should extend until actual reinstatement.
The CA dismissed the petition for review on the grounds that only 3 of the 228 petitioners complied with the mandatory Verification and Certification against forum shopping, thereby dismissing the pending petitions without reaching the merits of the case.
Petitioners later submitted a Manifestation with an Omnibus Motion containing a Verification and Certification against forum shopping executed by 161 signatories, contending that technical rules in labor cases are subject to leniency. The CA, however, held that the Rules of Court must be strictly observed and dismissed the petition on procedural grounds.

Whether the failure of the majority of petitioners to execute a Verification and Certification against forum shopping constituted a fatal defect justifying the dismissal of their Petition for Review.
Whether subsequent amendments or submissions, such as the Manifestation with Omnibus Motion by 161 signatories, could be considered substantial compliance in lieu of the initial defect.

Whether Miramar Fishing Co., Inc. should be held jointly and solidarily liable with Mar Fishing for the payment of separation pay and back wages to the petitioners.
Whether the two companies should be regarded as one and the same entity, thereby justifying the piercing of the corporate veil, in light of shared officers and similar business operations.

Whether the awarding of back wages should span until the reinstatement of the employees rather than ceasing on 30 July 2002.
The appropriate reckoning period for computing full back wages following the dismissal of employees.