G.R. No. L-19273-74 - Sta. Cecilia Sawmills, Inc. vs. Court of Industrial Relations

Petitioner: Sta. Cecilia Sawmills, Inc.
Respondents: Court of Industrial Relations and Tagkawayan Labor Union
The dispute arises from the dismissal of 113 laborers and the subsequent order of the court requiring their reinstatement.

The petitioner filed a motion for reconsideration seeking to avoid the order to reinstate the laborers.
The petitioner argued that reinstatement was impossible due to the factual circumstances alleged in its motion for a new trial, which pointed to the closing of the sawmills.
It was contended that ordering the reinstatement would cause significant losses to the petitioner, effectively constituting a penalty for having dismissed the employees without just cause.

Instead of ordering the reinstatement of the laborers—which was deemed impossible—the Court decreed that the dismissed employees should be entitled to three months’ back pay.
The rationale was that awarding back pay would serve as a compensatory measure equivalent to the penalty incurred by the petitioner.

The Tagkawayan Labor Union filed its own motion for reconsideration, objecting to the order granting only three months’ wages.
The union argued that the laborers should have been reinstated and allowed to continue working, contending that the evidence of sawmill closure was not properly established at trial.
The union maintained that the absence of evidence regarding the closing of the sawmills was due to its irrelevance to the key trial issue—which was whether the removal of the union members could be effected unless they affiliated with the National Labor Union under a closed-shop agreement.
The union further pointed out that the petitioner’s later claim of impossibility to reinstate was based on developments subsequent to the trial, particularly after the execution of the reinstatement order.

The petitioner had also filed a motion for a new trial asserting that the order should be modified, given the business losses incurred and the factual situation regarding the sawmills’ closure.
The Court found that although the motion for a new trial was filed late, it did not alter the main issue as it only pertained to modifying the period during which the judgment was to be enforced.

Whether the reinstatement of the 113 laborers was feasible given the alleged closure of the petitioner’s sawmills.

The petitioner argued that the nonexistence of operational sawmills rendered reinstatement impossible and that imposing such an order would cause undue losses.
The issue also raised the question of whether such losses constituted an acceptable penalty for the dismissal of the employees.

Whether the remedy of awarding three months’ back pay was an appropriate and just alternative to reinstatement.

The Court had to determine if back pay would adequately compensate the affected employees in the context of the business circumstances.
Consideration was given to whether the petitioner’s financial hardships and business losses justified modifying the original order.

The admissibility and relevance of evidence regarding the closing of the sawmills.

The union contended that evidence regarding the sawmills’ closure was not presented at trial because it was not central to the initial issue (i.e., the enforcement of a closed-shop agreement).
The Court needed to assess whether subsequent evidence of the closure could justify the modification of the remedy from reinstatement to back pay.