JUANITO A. GARCIA and ALBERTO J. DUMAGO, vs. PHILIPPINE AIRLINES, INC.

,
FACTS:
The case stemmed from the administrative charge filed by Philippine Airlines (PAL)
against its employees-herein petitioners after they were allegedly caught in the act
of sniffing shabu when a team of company security personnel and law enforcers
raided the PAL Technical Centers Toolroom Section on July 24, 1995.
After due notice, PAL dismissed petitioners for transgressing the PAL Code of
Discipline, prompting them to file a complaint for illegal dismissal and damages
which was resolved by the Labor Arbiter in their favor, thus ordering PAL to, inter
alia, immediately comply with the reinstatement aspect of the decision.
Subsequently, the Labor Arbiter issued a Writ of Execution respecting the
reinstatement decision and issued a Notice of Garnishment.
Respondent elevated the matter to the appellate court which issued the herein
challenged Decision and Resolution nullifying the NLRC Resolutions on two grounds,
essentially espousing that:
(1) a subsequent finding of a valid dismissal removes the basis for implementing the
reinstatement aspect of a labor arbiters decision; and
(2) the impossibility to comply with the reinstatement order due to corporate
rehabilitation provides a reasonable justification for the failure to exercise the
options under Article 223 of the Labor Code (the second ground).
Issues:
Whether Employees were entitled to wages corresponding to the period pending
their appeal to the NLRC, despite the subsequent reversal of the Labor Arbiters
decision by the NLRC.
Whether enforcement can still be effected despite the delay caused the corporate
rehabilitation proceedings.
RULING:
Amplification of the First Ground:
The Court reaffirms the prevailing principle that even if the order of reinstatement of
the Labor Arbiter is reversed on appeal, it is obligatory on the part of the employer
to reinstate and pay the wages of the dismissed employee during the period of
appeal until reversal by the higher court.
It settles the view that the Labor Arbiters order of reinstatement is immediately
executory and the employer has to either re-admit them to work under the same
terms and conditions prevailing prior to their dismissal, or to reinstate them in the
payroll, and that failing to exercise the options in the alternative, employer must
pay the employees salaries.
Amplification of the Second Ground

The Court sustains the appellate courts finding that the peculiar predicament of a
corporate rehabilitation rendered it impossible for respondent to exercise its option
under the circumstances.
The test is two-fold: (1) there must be actual delay or the fact that the order of
reinstatement pending appeal was not executed prior to its reversal; and (2) the
delay must not be due to the employers unjustified act or omission. If the delay is
due to the employers unjustified refusal, the employer may still be required to pay
the salaries notwithstanding the reversal of the Labor Arbiters decision.
WHEREFORE, the petition is PARTIALLY DENIED. Insofar as the Court of Appeals
Decision and Resolution annulling the NLRC Resolutions affirming the validity of the
Writ of Execution and the Notice of Garnishment are concerned, the Court finds no
reversible error.
CAPITOL MEDICAL CENTER (CMC) v. MERIS,
FACTS: Petitioner closed its industrial service unit due to alleged loss and extinct
demand resulting to the termination of the employment of the respondent. The latter
filed an illegal dismissal case but the same was denied by the labor arbiter, and
subsequently by the NLRC contending that the same is part of the management
prerogative.
ISSUE: Has employer the right to close its business even without basis resulting to the
displacement of the worker?
HELD: No. Employers are also accorded with rights and privileges to assure their selfdetermination and independence and reasonable return of capital. This mass of
privileges is called management prerogatives. Although they may be broad and
unlimited in scope, the State has the right to determine whether an employer's privilege
is exercised in a manner that complies with the legal requirements and does not offend
the protected rights of labor.
TIRAZONA v. PHILIPPINE EDS TECHNO-SERVICE (PET) INC
FACTS: The petitioner, a managerial employee who was holding a position of trust and
confidence, was admonished by the latter of her improper handling of a situation involving a
rank-and-file employee. She admitted having read a supposed confidential letter for the PET
directors containing a legal opinion of the respondent's counsel regarding the status of her
employment. As a consequence, she was terminated for willful breach of trust reposed upon
by her employer. She claimed having been denied of due process.
ISSUE: Was her dismissal justified?
HELD: Yes. The petitioner has given the respondent more than enough reasons to distrust
her. The arrogance and hostility she has shown towards the company her stubborn

uncompromising stance in almost all instances justify the company's termination of her
employment.

BREWMASTER INTERNATIONAL INC. v. NAFLU

FACTS: Private respondent Estrada is a member of the respondent labor union. He did
not report for work for 1 month due to a grave family problem as his wife deserted him
and nobody was there to look after his children. He was required to explain. Finding his
reasons to be unjustified, the petitioner terminated him, since according to company
rules, absence for 6 consecutive days is considered abandonment of work.
ISSUE: Should a worker be summarily dismissed relying on some company rules?
HELD: No. While the employer is not precluded from prescribing rules and regulations
to govern the conduct of his employees, these rules and their implementation must be
fair, just and reasonable. No less than the Constitution looks with compassion on the
workingman and protects his rights not only under a general statement of a state policy
but under the Article on Social Justice and Human Rights, thus placing labor contracts
on a higher plane and with greater safeguards. Verily, relations between labor and
capital are not merely contractual. They are impressed with public interest and labor
contracts must, perforce, yield to the common good.

MABEZA v. NLRC, G.R. No. 118506 April 18, 1997

FACTS: The petitioner and her co-employees were asked by their employer to sign an
instrument attesting to the latters compliance with minimum wage and other labor standard
provision, and that they have no complaints against the management. The petitioner signed
the affidavit but refused to go to the Citys Prosecutors Office to confirm the veracity and
contents of the affidavit as instructed by management. That same day she was ordered by
the hotel management to turn over the keys to her living quarters and to remove her
belongings in the hotels premises. She then filed a leave of absence which was denied by
her employer. She attempted to return to work but the hotels cashier told her that she
should not report to work and instead continue with her unofficial leave of absence. The
management defended upon a ground of loss of confidence.
ISSUE: Was the dismissal of the petitioner valid?
HELD: No. The pivotal question in any case where unfair labor practice on the part of the
employer is alleged is whether or not the employer has exerted pressure, in the form of
restraint, interference or coercion, against his employees right to institute concerted action
for better terms and conditions of employment. Without doubt, the act of compelling
employees to sign an instrument indicating that the employer observed labor standard

provisions of the law when he might not have, together with the act of terminating or
coercing those who refuse to cooperate with the employers scheme constitutes unfair labor
practice.