Case Summary (G.R. No. 189871)
Key Dates
• August 1990 – Dario Nacar’s hiring date
• January 24, 1997 – Date of alleged constructive dismissal
• October 15, 1998 – Labor Arbiter decision awarding separation pay and limited backwages
• May 27, 2002 – Finality of Supreme Court Resolution affirming dismissal award
• September 23, 2008 – Court of Appeals decision denying recomputation
• October 9, 2009 – CA resolution denying reconsideration
• August 13, 2013 – Supreme Court decision on petition for review
Applicable Law
• 1987 Philippine Constitution, Article XIII (Social Justice and Human Rights)
• Labor Code of the Philippines, Article 279 (Consequences of illegal dismissal)
• NLRC Rules, Rule VIII, Section 3 (Detailed computation in decisions)
• Civil Code, Article 1169 (Legal interest)
• BSP Circular No. 799 (Revised interest rate effective July 1, 2013)
Labor Arbiter Decision and Original Computation
The Labor Arbiter found that petitioner was constructively dismissed without due process or valid cause. Citing strained relations and the employee’s reluctance to return, the Arbiter granted separation pay in lieu of reinstatement and computed backwages only up to October 15, 1998. The award amounted to ₱158,919.92 for separation pay and ₱95,933.36 for backwages.
Post‐Decision Appeals and Finality
Respondents appealed to the NLRC, which affirmed the Arbiter’s decision and denied reconsideration. A subsequent petition for certiorari to the Court of Appeals was dismissed, and the Supreme Court likewise denied review in April 2002. An Entry of Judgment on May 27, 2002 rendered the Arbiter’s decision final and executory.
Execution Proceedings and Recomputations
Upon execution, petitioner sought recomputation of backwages up to May 27, 2002. The NLRC Computation Unit first arrived at ₱471,320.31, but a later recomputation reduced it to ₱147,560.19. Petitioner received the latter sum pending final recalculation. After petitioner’s motion for recalculation of interest, the Arbiter granted only ₱11,459.73 more, reasoning that the October 15, 1998 computation was immutable once final. The NLRC and CA upheld that position, invoking the immutability of final judgments.
Issue on Recomputing Awards
The Supreme Court identified the core question as whether recomputation of monetary awards during execution violates the finality rule. It distinguished between the substantive finding of illegal dismissal—which becomes immutable—and the numerical computation of resulting awards, which may be re‐computed to reflect relief up to the finality of the decision.
Jurisprudential Foundation: Session Delights
Relying on Session Delights Ice Cream and Fast Foods v. Court of Appeals, the Court held that:
- The decision’s first part (illegality and entitlement to relief) is final and binding.
- The second part (time‐bound computation) is a provisional figure subject to recomputation up to the decision’s finality.
- Recomputing does not alter the substantive judgment but merely adjusts the monetary consequences to their proper temporal extent.
Recomputations Under Article 279
Article 279 of the Labor Code and related NLRC rules implicitly require detailed computation in decisions but allow recalculation of awards to include all benefits accruing until finality. Continuation of appeals does not freeze the accrual of backwages and separation pay. Thus, execution must reflect the full amount due from dismissal to the date the decision becomes final and executory.
Legal Interest Guidelines
Case Syllabus (G.R. No. 189871)
Facts
- Petitioner Dario Nacar was hired by Gallery Frames in August 1990 and dismissed on January 24, 1997.
- He filed a complaint for constructive dismissal with the NLRC (NCR Case No. 01-00519-97).
- On October 15, 1998, the Labor Arbiter ruled that petitioner was dismissed without just cause, awarded separation pay and backwages computed only up to the promulgation date of the decision (August 18, 1998), totaling ₱158,919.92.
Procedural History
- NLRC affirmed the Labor Arbiter’s Decision by Resolution dated February 29, 2000; motion for reconsideration denied.
- Court of Appeals dismissed respondents’ Petition for Certiorari on August 24, 2000; motion for reconsideration denied May 8, 2001.
- Supreme Court denied a Rule 65 petition on April 17, 2002; Entry of Judgment certified finality on May 27, 2002.
- Petitioner filed a Motion for Correct Computation to include accrual up to May 27, 2002; NLRC Computation and Examination Unit arrived at ₱471,320.31.
- Labor Arbiter issued a Writ of Execution (December 2, 2002); respondents moved to quash (denied January 13, 2003) and an Alias Writ followed on January 14, 2003.
- NLRC granted respondents’ appeal on June 30, 2003, ordered recomputation; Entry of Judgment on August 20, 2003.
- Subsequent recomputations produced ₱147,560.19; petitioner received this amount under an Alias Writ issued January 14, 2003.
- Petitioner sought interest on the awards; Labor Arbiter granted interest amounting to ₱11,459.73 on May 10, 2005.
- NLRC denied petitioner’s appeal (September 27, 2006) and motion for reconsideration (January 31, 2007).