LABOR CODE

G.R. No. 182957 June 13, 2013

ST. JOSEPH ACADEMY OF VALENZUELA FACULTY ASSOCIATION (SJA VFA)-FUR CHAPTER-

RESOLUTION

REYES, J.:

St. Joseph Academy of Valenzuela Faculty Association-FUR Chapter TUCP (petitioner), in behalf of
thirteen ( 13) of its members, filed the present petition1 seeking review of the Decision2 dated
January 11, 2008 and Resolution3 dated May 20, 2008 of the Court of Appeals (CA) in CA-G.R. SP
No. 8164 7, which deleted the reinstatement and award of back wages portions in the Secretary of
Labor and Employment's (SOLE) Decision4 dated September 9, 2003.

The dispute arose from a notice of strike filed by the petitioner against respondent St. Joseph
Academy of Valenzuela (SJAV) for illegal termination and union busting. The SOLE assumed
jurisdiction after the parties agreed to submit the case for voluntary arbitration. 5 Originally affected
were nineteen (19) union members employed by SJAV as teachers. Four (4) of the members have
already passed the teacher’s board examinations, namely: (1) Reshiel R. Isagan; (2) Mary Grace C.
Dimaunahan; (3) Novelyn I. Puyot; and (4) Elizabeth O. Nicol.6 The SOLE ordered their
reinstatement with full backwages up to the date of their actual reinstatement. 7

The other 15 members are non-licensees. They are: (1) Lucita A. Marzan; (2) Ma. Erlinda H.
Sarmiento; (3) Ma. Lourdes B. Alonzo; (4) Toni Socorro B. Eliseef (Eliseef); (5) Maureen F. Aliwalas;
(6) Yvor Stanley A. Aquino; (7) Teresita M. Musa (Musa); (8) Luzviminda L. Cruz; (9) Glenda D.
Pedrosa; (10) Ma. Theresa E. Oliveros; (11) Anna Lea C. Junsay; (12) Rebesita F. Ferry; (13)
Bernadeth M. Salvador; (14) Maribeth S. Bandola; and (15) Jeneth W. Eugenio. 8 With regard to
them, the SOLE ordered the reinstatement of those with a valid temporary or special permit with full
backwages up to the date of their actual reinstatement. The SOLE, however, also ordered that they
shall only serve for the remaining period corresponding to the period of validity of their permit. 9 The
pertinent dispositive portion of the SOLE Decision provides:

WHEREFORE, foregoing premises being duly considered, x x x.

With respect to the fifteen (15) non-licensee teachers, only those who have submitted a valid
temporary or special permit shall be reinstated to their former positions with full backwages
computed from the time their compensation were withheld up to the date of their actual
reinstatement. But they shall only serve for the remaining period corresponding to the period of
validity of their permit.

xxxx

SO ORDERED.10

In ordering their reinstatement and the award of backwages, the SOLE ruled that even as
probationary employees, the non-licensees still enjoy security of tenure and SJAV should have given
them the opportunity to comply with the license requirement mandated by Republic Act (R.A.) No.
7836.11 Hence, the SOLE concluded that SJAV "should retain their services and backwages x x x
from April 1, 2003 up to the date they are reinstated to their former positions." 12

The CA, however, ruled that reinstatement is no longer possible inasmuch as it is the Department of
Education, Culture and Sports that can assign the para-teachers13 to schools as it may determine.
Moreover, SJAV cannot be deprived of its right to choose its teachers and the positions have already
been actually filled up.14 The CA also deleted the award of backwages since, as found by the SOLE,
there was no illegal dismissal committed by SJAV, the non-licensees not being its regular
employees.15

The petitioner now beseeches the Court to restore the SOLE’s award of backwages and for the
award of separation pay in lieu of reinstatement, anchored on grounds of "equity and compassionate
justice."16 The petitioner admits that the non-licensees’ temporary or special permits have already
expired, thus making reinstatement impossible; it, however, asks for the award of separation pay
and backwages given the non-licensees’ years of service with SJAV, that they "somehow
contributed" to the school’s progress and they have been efficient teachers. 17 The petitioner also
stated that two (2) of the non-licensees, Eliseef and Musa, opted to pursue before the National Labor
Relations Commission their claim for separation pay, which was decided by the Labor Arbiter in
2005 with the recommendation that "the federation dwell on the matter of complainants’ benefits in a
supplemental pleading if only to call the attention of the division justices to whom the case is
assigned for decision."18

Expectedly, SJAV calls for the dismissal of the petition on the argument that since the non-licensees
could not have become regular employees, then there can be no grant of backwages and
reinstatement as it presupposes illegal termination of employees.19

Review of labor cases under Rule

45 of the Rules of Court

In Phimco Industries, Inc. v. Phimco Industries Labor Association,20 the Court reiterated the basic
approach in the review of CA decisions in labor cases, viz:

In a Rule 45 review, we consider the correctness of the assailed CA decision, in contrast with the
review for jurisdictional error that we undertake under Rule 65. Furthermore, Rule 45 limits us to the
review of questions of law raised against the assailed CA decision. In ruling for legal correctness, we
have to view the CA decision in the same context that the petition for certiorari it ruled upon was
presented to it; we have to examine the CA decision from the prism of whether it correctly
determined the presence or absence of grave abuse of discretion in the NLRC decision before it, not
on the basis of whether the NLRC decision on the merits of the case was correct. In other words, we
have to be keenly aware that the CA undertook a Rule 65 review, not a review on appeal, of the
NLRC decision challenged before it. This is the approach that should be basic in a Rule 45 review of
a CA ruling in a labor case. In question form, the question to ask is: Did the CA correctly determine
whether the NLRC committed grave abuse of discretion in ruling on the case? 21

Applying the foregoing rule, the question now is whether the CA committed an error in deleting the
award of backwages and reinstatement originally granted by the SOLE.

Reinstatement or payment of
separation pay, and award of
backwages proper only in cases of
illegal dismissal
Generally, the finding of illegal dismissal entitles an employee to the twin remedies of reinstatement
and payment of backwages.22 Article 279 of the Labor Code states, in part, that an employee who is
unjustly dismissed from work shall be entitled to reinstatement without loss of seniority rights and
other privileges and to his full backwages, inclusive of allowances, and to his other benefits or their
monetary equivalent computed from the time his compensation was withheld from him up to the time
of his actual reinstatement. These twin remedies – reinstatement and payment of backwages –
make the dismissed employee whole who can then look forward to continued employment. 23

The law intends the award of backwages and similar benefits to accumulate past the date of the
Labor Arbiter’s decision until the dismissed employee is actually reinstated. But if, as in this case,
reinstatement is no longer possible, this Court has consistently ruled that backwages shall be
computed from the time of illegal dismissal until the date the decision becomes final. (Emphasis
supplied)

xxxx

The basis for the payment of backwages is different from that for the award of separation pay.
Separation pay is granted where reinstatement is no longer advisable because of strained relations
between the employee and the employer. Backwages represent compensation that should have
been earned but were not collected because of the unjust dismissal. The basis for computing
backwages is usually the length of the employee’s service while that for separation pay is the actual
period when the employee was unlawfully prevented from working. 24

In this case, the SOLE and the CA were one in ruling that there was no illegal dismissal committed
by SJAV against the non-licensees. As both stressed by the SOLE and the CA, R.A. No. 7836
provides that no person shall engage in teaching and/or act as professional teacher unless he is a
duly registered professional teacher, and a holder of a valid certificate of registration and a valid
professional license or a holder of a valid special/temporary permit. 25 Obviously, aside from the
finding that there was no illegal dismissal, the non-licensees cannot be reinstated since they do not
possess the necessary qualification for them to be engaged in teaching and/or act as professional
teachers. This conclusion binds the Court, especially in the absence of any circumstance that
militates against such conclusion. The rule is that the findings of fact of the SOLE and the CA and
the conclusions derived therefrom are generally binding on the Court if amply supported by evidence
on record.26

Consequently, the Court finds that the CA did not commit an error in ruling that reinstatement is not
possible. In the same light, the Court finds that the CA, likewise, did not commit an error in deleting
the award of backwages. As previously stressed, payment of backwages and other benefits is
1âwphi1

justified only if the employee was illegally dismissed.27

Award of financial assistance as a

Nevertheless, the Court, in exceptional cases, has granted financial assistance to legally dismissed
employees as an act of "social justice" or based on "equity" so long as the dismissal was not for
serious misconduct, does not reflect on the employee’s moral character, or would involve moral
turpitude.28 In Nissan Motor Philippines, Inc. v. Angelo,29 the Court ruled that, inspired by
compassionate and social justice, it has in the past awarded financial assistance to dismissed
employees when circumstances warranted such an award. Meanwhile, in Pharmacia and Upjohn,
Inc. v. Albayda, Jr.,30 the Court held that an award to the employee of separation pay by way of
financial assistance, equivalent to one-half (1/2) month’s pay for every year of service, is equitable.
The Court, in Pharmacia, noted, among others, that although the employee’s actions constituted a
valid ground to terminate his services, the same is not so reprehensible as to warrant complete
disregard of his long years of service.

Similarly in this case, the dismissal of the 13 non-licensees31 was due to their failure to possess
teaching licenses. It was not due to any serious misconduct or infraction reflecting their moral
character. Records also bear that they have been in the employ of SJAV from five (5) to nine (9)
years,32 and as observed by the SOLE, SJAV has not shown any dissatisfaction with their teaching
services, "otherwise, x x x, it would not have kept them under its employ for such quite a period of
time."33

This being the case, the Court, in keeping with equity and social justice, grants the award of financial
assistance to the 13 non-licensees equivalent to one-half (1/2) month’s pay for every year of service
rendered with SJAV.

WHEREFORE, the petition is PARTIALLY GRANTED. The Decision dated January 11, 2008 and
Resolution dated May 20, 2008 of the Court of Appeals in CA-G.R. SP No. 81647 are MODIFIED
and respondent St. Joseph Academy of Valenzuela is hereby ORDERED to pay the thirteen ( 13)
non-licensees financial assistance equivalent to one-half (1/2) month's pay for every year of service.

The case is remanded to the Department of Labor and Employment for proper computation of the
award in accordance with this Decision.

SO ORDERED.