G.R. No. 102406 - Sampaguita Garments Corp. vs. National Labor Relations Commission

The petitioner, Sampaguita Garments Corporation, employed Emilia B. Santos.
On April 14, 1987, it was alleged that Santos attempted to remove, without authorization, a piece of cloth belonging to the petitioner from the company premises.
Based on this alleged act of theft, the petitioner dismissed Santos.

Santos filed a complaint for illegal dismissal.
The labor arbiter initially sustained the petitioner’s decision to dismiss.
The National Labor Relations Commission (NLRC) reversed the arbiter’s decision, ordering Santos’s reinstatement with back wages covering the period from her suspension until reinstatement.
The NLRC’s decision eventually became final and executory as of August 7, 1990.

Independently from the administrative case, the petitioner initiated a criminal action against Santos in the Municipal Trial Court of Caloocan City for the same act of theft.
After trial, Santos was convicted of theft and sentenced to an indeterminate penalty of arresto mayor, with a minimum of 1 month and 1 day and a maximum of 4 months.
The conviction was affirmed first by the Regional Trial Court of Caloocan City and later by higher courts, including this Court in relevant decisions.

Despite the finality of the NLRC decision ordering reinstatement with back wages, the petitioner opposed its execution, invoking Santos’s criminal conviction for theft.
The petitioner argued that enforcing the NLRC decision would reward the employee despite her subsequent criminal conviction, thereby conflicting with the punitive purpose of dismissal for an offense involving moral turpitude.
The NLRC, relying on its power to reconsider execution in light of supervening events, initially sustained the implementation of its decision before further judicial intervention.

The petitioner sought relief from this Court, asserting that the criminal conviction should nullify the administrative decision of reinstatement and back wages.
It was contended that to reinstate an employee who has committed an offense involving moral turpitude would be unjust and contrary to principles of social justice.
Although the Solicitor General suggested granting separation pay as an alternative remedy, it was argued against on the basis that such a measure would still constitute an improper reward for wrongful behavior.
The petitioner further pointed out that the NLRC’s decision, although final and executory, might be modified or suspended considering extraordinary and supervening circumstances.

Whether the final and executory NLRC decision ordering Santos’s reinstatement with back wages can be modified or suspended in light of her subsequent criminal conviction for theft.

The primary issue is if the conviction for an offense involving moral turpitude can serve as a supervening cause to render the administrative remedy unjust and inequitable.
Whether the judicial power extends to reviewing the correctness of execution of a final NLRC decision when new, adverse developments occur.

Whether the award of separation pay, as suggested by the Solicitor General, is justified under the circumstances.

The issue revolves around whether an employee convicted of theft and an offense involving moral turpitude is entitled to any form of financial remedy (reinstatement, separation pay, or back wages) under labor law.
Whether enforcing such awards contradicts the fundamental principle that punitive measures should not be mitigated or reversed by additional rewards.