G.R. No. 188269 - Sumifru Corp. vs. Baya

Bernabe Baya (respondent) filed a complaint for illegal/constructive dismissal against AMS Farming Corporation (AMSFC) and Davao Fruits Corporation (DFC) before the National Labor Relations Commission (NLRC).
Baya alleged employment with AMSFC starting February 5, 1985, progressing to supervisory rank by September 1, 1997.

As a supervisor, Baya joined the supervisors' union and formed AMS Kapalong Agrarian Reform Beneficiaries Multipurpose Cooperative (AMSKARBEMCO), representing AMSFC regular employees.
In June 1999, Baya was reassigned to supervisory positions at DFC, AMSFC’s sister company, and remained active in AMSKARBEMCO.
Via AMSKARBEMCO's petition, about 220 hectares of AMSFC’s banana plantation were covered by the Comprehensive Agrarian Reform Program (CARP), transferring lands to Agrarian Reform Beneficiaries (ARBs), including Baya.

ARBs attempted an agribusiness agreement with AMSFC, which failed; subsequent negotiations ceased by the Department of Agrarian Reform (DAR).
In October 2001, ARBs held a referendum choosing between AMSKARBEMCO and SAFFPAI (a pro-company group); majority voted for AMSKARBEMCO.
AMSFC opposed AMSKARBEMCO's export agreement with another company; Baya and other officers were summoned and threatened.
A DFC manager pressured Baya to shift loyalty to SAFFPAI, which he refused.
Baya received a letter ending his secondment with DFC and ordering his return to AMSFC.
Upon return to AMSFC on August 30, 2002, he was assigned rank-and-file positions despite prior supervisory status.
Baya’s request for reinstatement to supervisory post was denied on September 20, 2002, leading to the complaint’s filing on the same date.
The DAR effectuated the takeover of the awarded lands on September 20, 2002.
Subsequently, AMSKARBEMCO members, including Baya, were dismissed and replaced by contract workers; SAFFPAI members were retained.

AMSFC and DFC claimed Baya’s termination was not illegal or constructive dismissal, but resulted from the agrarian reform program’s impact on their business operations.
They argued Baya’s actions in forming AMSKARBEMCO led to the takeover and resultant employment cessation.

On June 30, 2003, the LA ruled in favor of Baya, declaring constructive dismissal, ordering reinstatement or, if impracticable, separation pay at 39.25 days per year of service.
The LA ordered payment of backwages, benefits, moral damages, exemplary damages, and attorney’s fees.
Demotion without justification was found unlawful; lack of supervisory positions was not a valid reason as transfer to AMSFC was without prior assessment.
Constructive dismissal occurred before ARBs’ takeover, disproving the defendants’ claim.

The NLRC reversed the LA in a resolution dated March 10, 2004, dismissing the complaint except for 13th month pay.
The NLRC held termination as due to involuntary cessation of business from agrarian reform, disallowing separation pay.
Motion for reconsideration by Baya was denied on May 31, 2004.

On May 14, 2008, the CA set aside the NLRC resolutions, reinstated the LA ruling with modifications: deleted awards of backwages, vacation and sick leave pay, housing and electric subsidies, and exemplary damages.
Ordered AMSFC and DFC to pay Baya P278,600.05 (separation pay, 13th month pay, moral damages, attorney’s fees) solidarily.
Found NLRC guilty of grave abuse of discretion; constructive dismissal supported.
Noted cooperative busting tactics, harassment, and pressure to switch loyalty as motives for constructive dismissal.
Rejected backwages due to Baya's ownership of agrarian reform land awarded.
Motion for reconsideration denied on May 20, 2009.

During CA proceedings, Sumifru (Philippines) Corporation acquired DFC through merger in 2008 and later filed this petition.
Sumifru argues liability only for period of employment under DFC, not AMSFC.

Whether the Court of Appeals correctly ruled that the NLRC gravely abused its discretion in dismissing Baya’s complaint and held that AMSFC and DFC constructively dismissed Baya.

Whether AMSFC and DFC are liable to Baya for separation pay, moral damages, and attorney's fees.

Whether Sumifru, as the surviving corporation in the merger with DFC, should be held solidarily liable with AMSFC for Baya’s monetary awards.