GARCIA v. PAL, GR 164856, Jan.

20, 2009
FACTS: PAL filed an administrative case against Garcia and Dumago after they were allegedly caught sniffing
shabu at the PAL Tool Room. After due notice, they were dismissed for transgressing the PAL Code of Discipline.
The petitioners filed a complaint for illegal dismissal. The Labor Arbiter decided in favor of petitioners with an
immediate reinstatement. A writ was issued to such effect pending appeal with the NLRC.
ISSUE: Can the petitioners collect wages on the period of appeal from the Labor Arbiters order up to the final
decision of the higher court?
HELD: Yes. The State forcefully and meaningfully underscore labor as a primary social and economic force. In
short, with respect to decisions reinstating employees, the law itself has determined a sufficiently overwhelming
reason for its execution pending appeal. Therefore, the petitioners can collect wages from the period of the
execution of the decision of the labor arbiter to the time of the final decision of the higher court.

Session Delights Ice Cream & Fastfoods vs. CA, G.R. No. 172149 , February 8, 2010
Post under case digests, labor law at Saturday, February 04, 2012 Posted by Schizophrenic Mind
Facts: A complaint for illegal dismissal was filed against petitioner Session Delights Ice Cream & Fast Foods by
private respondent Adonis Armenio M. Flora, docketed as NLRC Case No. RAB-CAR 09-0507-00. The labor arbiter
decided against petitioner, finding that it had illegally dismissed the private respondent. Based on such finding, it
awarded private respondent backwages, separation pay in lieu of reinstatement, indemnity, and attorneys fees.
The CA affirmed with modification the NLRC decision by deleting the awards for a proportionate 13th month pay
and for indemnity. The CA decision became final per Entry of Judgment dated July 29, 2003.
In January 2004, and in the course of the execution of the above final judgment, a pre-execution conference was
held, with the contending parties in attendance. In said conference an updated computation of the monetary
awards in the total amount of P235,986.00, which included additional backwages and separation pay and a
proportionate amount of the 13th month pay due to private respondent Flora, was made and was approved by the
Labor Arbiter about three (3) months after.
The petitioner objected to the re-computation and appealed the labor arbiters order to the NLRC but the same
was denied. The CA, however, partially granted the petition by deleting the awarded proportionate 13th month
pay.
Issue: Whether or not the updated computation was proper
Held: Yes, the updated computation was proper. The issue in the case at bar is not the correctness of the
awards, the finality of the CAs judgment, nor the petitioners failure to appeal. Rather, it is the propriety of the
computation of the awards made, whether this violated the principle of immutability of final judgments.
In concrete terms, the question is whether a re-computation in the course of execution, of the labor arbiters
original computation of the awards made pegged as of the time the decision was rendered and confirmed with
modification by a final CA decision, is legally proper.

The Court held that under the terms of the decision under execution, no essential change is made by a recomputation as this step is a necessary consequence that flows from the nature of the illegality of dismissal
declared in that decision. A re-computation (or an original computation, if no previous computation has been
made) is a part of the law specifically, Article 279 of the Labor Code and the established jurisprudence on this
provision that is read into the decision. By the nature of an illegal dismissal case, the reliefs continue to add on
until full satisfaction, as expressed under Article 279 of the Labor Code. The re-computation of the consequences
of illegal dismissal upon execution of the decision does not constitute an alteration or amendment of the final
decision being implemented. The illegal dismissal ruling stands; only the computation of the monetary
consequences of this dismissal is affected and this is not a violation of the principle of immutability of final
judgments.

G.R. No. 181913 : March 5, 2010

DANIEL P. JAVELLANA, JR., Petitioner, v. ALBINO BELEN, Respondent.
ABAD,J.:
FACTS:
On May 9, 2000 petitioner filed a complaint against respondents for illegal dismissal and underpayment or nonpayment of salaries, overtime pay, holiday pay, service incentive leave pay (SILP), 13thmonth pay, premium pay
for holiday, and rest day as well as for moral and exemplary damages and attorneys fees.
Petitioner Belen alleged that respondent Javellana hired him as company driver on January 31, 1994 and
assigned him the tasks of picking up and delivering live hogs, feeds, and lime stones used for cleaning the
pigpens. On August 19, 1999 Javellana gave him instructions to (a) pick up lime stones in Tayabas, Quezon; (b)
deliver live hogs at Barrio Quiling, Talisay, Batangas; (c) have the delivery truck repaired; and (d) pick up a boar at
Joliza Farms in Norzagaray, Bulacan.
Respondent Javellana claimed, on the other hand, that he hired petitioner Belen in 1995, not as a company
driver, but as family driver.Belen did not do work for his farm on a regular basis, but picked up feeds or delivered
livestock only on rare occasions when the farm driver and vehicle were unavailable.
Regarding petitioner Belens dismissal from work, respondent Javellana insisted that he did it for a reason.Belen
intentionally failed to report for work on August 20, 1999 and this warranted his dismissal.
On November 25, 2002, the LA found petitioner Belen to be a company driver as evidenced by the pay slips that
the farm issued to him and held that his abrupt dismissal was illegal. The LA awarded him backwages, separation
pay, 13thmonth pay, SILP, holiday pay, salary differential, and attorneys fees.
On appeal, the NLRC modified the decision of the LA. The NLRC found Belen to have been illegally dismissed.But
since he was but a family driver, the NLRC deleted the award of backwages and separation pay and instead
ordered Javellana to pay him 15 days salary by way of indemnity pursuant to Article 149 of the Labor Code.Belen
moved for reconsideration, but the NLRC denied his motion.

On appeal, the CA held that Javellanas abrupt dismissal of Belen for an isolated case of neglect of duty was
unjustified. It however, modified the award of backwages and separation pay.
Both respondent Javellana and petitioner Belen moved for reconsideration of the decision but the CA denied
them. The Court consolidated the two cases. Javellanas petition was denied, hence he moved for reconsideration
but the Court denied it with finality on September 22, 2008.
Hence, this petition.
ISSUES:
Whether or not the Labor Arbiter correctly computed petitioner Belens backwages and separation pay?
Whether or not the monetary award in his favor should run until the finality of the decision in his case?
HELD:
The petition is granted.
LABOR LAW
Records show that the LA's approved computation gave the period as from August 20, 1999 to November
19,2000 when the proper period was from August 20, 1999, the date he was dismissed from work, to November
25,2002, the date the Labor Arbiter rendered his decision in the case.
It is obvious from a reading of the Labor Arbiters decision that the date November 19,2000 stated in the
computation was mere typographical error.Somewhere in the body of the decision is the categorical statement
that petitioner Belen is entitled to backwages from August 20, 1999 up to the date of this decision. Since the
Labor Arbiter actually rendered his decision on November 25,2002, it would be safe to assume that he caused
the computation of the amount of backwages close to that date or on November 19, 2002.The same could be
said of the computation of petitioner Belens separation pay.
LABOR LAW
Article 279 of the Labor Code, as amended by Section 34 of Republic Act 6715 clearly intends that the award of
backwages and similar benefits to accumulate past the date of the LA'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.
As it happens, the parties filed separate petitions before this Court.The petition in G.R. 181913, filed by
respondent Javellana, questioned the CA's finding of illegality of dismissal while the petition in G.R. 182158,
filed by petitioner Belen, challenged the amounts of money claims awarded to him.The Court denied the first with
finality in its resolution of September 22, 2008; the second is the subject of the present case.Consequently,
Belen should be entitled to backwages from August 20, 1999, when he was dismissed, to September 22, 2008,
when the judgment for unjust dismissal in G.R. 181913 became final.
Separation pay, on the other hand, is equivalent to one month pay for every year of service, a fraction of six
months to be considered as one whole year.Here that would begin from January 31, 1994 when petitioner Belen
began his service. Technically the computation of his separation pay would end on the day he was dismissed on
August 20, 1999 when he supposedly ceased to render service and his wages ended.But, since Belen was

entitled to collect backwages until the judgment for illegal dismissal in his favor became final, here on September
22, 2008, the computation of his separation pay should also end on that date.
Further, since the monetary awards remained unpaid even after it became final on September 22, 2008 because
of issues raised respecting the correct computation of such awards, it is but fair that respondent Javellana be
required to pay 12% interestper annum on those awards from September 22, 2008 until they are paid.The 12%
interest is proper because the Court treats monetary claims in labor cases the equivalent of a forbearance of
credit.It matters not that the amounts of the claims were still in question on September 22, 2008.What is
decisive is that the issue of illegal dismissal from which the order to pay monetary awards to petitioner Belen
stemmed had been long terminated.
CA SET ASIDE.
G.R. No.170904 November 13, 2013
BANI RURAL BANK INC. ENOC THEATER I AND II and/or RAFAEL DE GUZMAN, Petitioners, v. TERESA DE GUZMAN,
EDGAR C. TAN and TERESA G. TAN, Respondents.
BRION,J.:
FACTS:
The respondents were employees of Bani Rural Bank, Inc. and ENOC Theatre I and II who filed a complaint for
illegal dismissal against the petitioners. The complaint was initially dismissed by the LA but the NLRC reversed
LAs decision. The NLRC, in its resolution dated March 17, 1995, ordered that respondents be reinstated with
payment of backwages from the time of their dismissal until their actual reinstatement. Such decision has
become final and executory. Computation of backwages was referred to Labor Arbiter Gambito.
Petitioners appealed the computation of the backwages with the NLRC. In a decision dated July 31, 1998, the
NLRC modified the terms of the March 17, 1995 resolution insofar as it clarified the phrase less earnings
elsewhere. The NLRC additionally awarded the payment of separation pay, in lieu of reinstatement on account of
the strained relations between the parties.
As explained in the assailed Decision, what is controlling for purposes of the backwages is the NLRC s Resolution
dated 17 March 1995 which decreed that private respondents are entitled to backwages from the time of their
dismissal (constructive) until their actual reinstatement; and considering that the award of reinstatement was set
aside by the NLRC in its final and executory Decision dated 3 July 1998 which ordered the payment of separation
pay in lieu of reinstatement to be computed up to the finality on 29 January 1999 of said Decision dated 3 July
1998, then the computation of the backwages should also end on said date, which is 29 January 1999
ISSUE: Whether or not NLRC erred in ruling how the backwages are to be computed
HELD: No. CA decision affirming NLRC ruling sustained.
Labor Law - The computation of backwages depends on the final awards adjudged as a consequence of illegal
dismissal.

First, when reinstatement is ordered, the general concept under Article 279 of the Labor Code, as amended,
computes the backwages from the time of dismissal until the employees reinstatement. The computation of
backwages (and similar benefits considered part of the backwages) can even continue beyond the decision of the
labor arbiter or NLRC and ends only when the employee is actually reinstated.
Second, when separation pay is ordered in lieu of reinstatement (in the event that this aspect of the case is
disputed) or reinstatement is waived by the employee (in the event that the payment of separation pay, in lieu, is
not disputed), backwages is computed from the time of dismissal until the finality of the decision ordering
separation pay.
Third, when separation pay is ordered after the finality of the decision ordering the reinstatement by reason of a
supervening event that makes the award of reinstatement no longer possible (as in the case), backwages is
computed from the time of dismissal until the finality of the decision ordering separation pay.
As the records show, the contending parties did not dispute the NLRC s order of separation pay that replaced the
award of reinstatement on the ground of the supervening event arising from the newly-discovered strained
relations between the parties. The parties allowed the NLRC s July 31, 1998 decision to lapse into finality and
recognized, by their active participation in the second computation of the awards, the validity and binding effect
on them of the terms of the July 31, 1998 decision.
Under these circumstances, while there was no express modification on the period for computing backwages
stated in the dispositive portion of the July 31, 1998 decision of the NLRC, it is nevertheless clear that the award
of reinstatement under the March 17, 1995 resolution (to which the respondents backwages was initially
supposed to have been computed) was substituted by an award of separation pay. As earlier stated, the awards
of reinstatement and separation pay are exclusive remedies; the change of awards (from reinstatement to
separation pay) under the NLRC s July 31, 1998 not only modified the awards granted, but also changed the
manner the respondents backwages is to be computed. The respondents backwages can no longer be computed
up to the point of reinstatement as there is no longer any award of reinstatement to speak of.
Thus, the computation of the respondents' backwages must be from the time of the illegal dismissal from
employment until the finality of the decision ordering the payment of separation pay. It is only when the NLRC
rendered its July 31, 1998 decision ordering the payment of separation pay (which both parties no longer
questioned and which thereafter became final) that the issue of the respondents' employment with the
petitioners was decided with finality, effectively terminating it. The respondents' backwages, therefore, must be
computed from the time of their illegal dismissal until January 29, 1999, the date of finality of the NLRC's July
31, 1998 Decision.