301 Same; Same; Same; No basis for respondents-workers Gregorio Araneta University Foundation vs. NLRC being considered retired or separated from the service, as Nos. 75925-26. October 29, 1987. *
their resignation or retirement is subject to the proviso that
GREGORIO ARANETA UNIVERSITY FOUNDATION their positions have been abolished by the reorganizational and OBED JOSE MENESES, petitioners, vs. set-up under the retrenchment program.The guidelines NATIONAL LABOR RELATIONS COMMISSION, of the retrenchment program as approved by the Minister PEDRO L. REYES, ROSARIO D. REYES, BILLY T. of Labor specifically states that under the reorganizational VICARIO, CORAZON D. VICARIO, LUIS ALMAZAN set up, all the employees of the university would be and JULIAN R. MAIMBAN, JR., respondents. considered separated or retired with corresponding Labor; Illegal Dismissal; Retrenchment; Failure of grants of termination pay or retirement benefits, employees to file their courtesy resignations cannot whichever is higher, and all would be rehired except those whose present positions will be affected by the automatically result in their dismissal or inclusion in the retrenchment; Reason.The failure of the private proposed reorganizational changes. All the employees respondents to file their courtesy resignations cannot were, therefore, considered resigned under the reorganizational set up without any need for the courtesy automatically result in dismissal or inclusion in the resignations demanded by the petitioner university in its retrenchment. We agree with the NLRC that such courtesy letters of resignations memorandum-circular. The resignations or retirement ______________ of the employees are, of course, subject to the proviso that * THIRD DIVISION. their positions have been abolished by the reorganizational set up envisioned in the retrenchment 302 program. In the case of the private respondents, their positions were not abolished. Hence, there is no basis for 302 SUPREME COURT REPORTS ANNOTATED their being considered retired or separated from the Gregorio Araneta University Foundation vs. NLRC university. were merely administrative requirements that could be Same; Same; Same; Temporary employees, not a case of; dispensed with in the implementation of the Fact that the petitioners voluntarily signed the appointments extended to them does not make them the proposition that the private respondents are estopped temporary employees; Persons like the employees in case from questioning their dismissal because they accepted at bar who are deans and department heads and who have their 30-day termination pay, suffice it to state that the served the University for 28 years, could not be considered private respondents cannot waive their rights protected by temporary employees or casuals.The contention of the no less than the Constitution. Section 18, Article 11 of the university that the private respondents positions are 1987 Constitution provides that The state affirms labor as temporary in nature as indicated in their appointments is a primary social economic force. It shall protect the rights not well taken. The fact that the petitioners voluntarily of workers and promote their welfare. This Constitutional signed the appointments extended to them does not make protection to labor has been carried through all our three them temporary employees. x x x Undoubtedly, the (3) constitutions since 1935. private respondents positions as deans and department Same; Same; Same; Reorganization cannot be used as a heads of the petitioner university are necessary in its usual convenient device to get rid of existing personnel and business. Moreover, all the private respondents have been replace them with new ones.The appeal to the Court serving the university from eighteen (18) to twenty-eight about saving a noble institution from collapse has no basis. (28) years. All of them rose from the ranks starting as Retrenchments are allowed for all unnecessary positions instructors until they became deans and department based on the petitioners own reorganization program. heads of the university. A person who has served the However, the reorganization cannot be used as a University for 28 years and who occupies a high convenient device to get rid of existing personnel in order administrative position in addition to teaching duties could to replace them with new ones. For this purpose, the not possibly be a temporary employee or a casual. regular rules and procedures on dismissal of employees 303 will have to be followed. VOL. 155, OCTOBER 29, 1987 303 PETITION to review the decision of the National Gregorio Araneta University Foundation vs. NLRC Labor Relations Commission. Same; Same; Same; Proposition that the respondents are The facts are stated in the opinion of the Court. estopped from questioning their dismissal because they accepted their 30-day termination pay, is not correct GUTIERREZ, JR., J.: because they cannot waive their constitutional rights.On The petitioners seek to annul the decision of the National Labor Relations Commission (NLRC) financial difficulties. ordering the Gregorio Araneta University In a letter reply to Mijares, dated March 29, 1984, Foundation to reinstate the private respondents Minister Ople found no serious objection to the to their former positions, with full backwages program but advised him that it should be under the new terms and conditions of implemented without prejudice to whatever employment in the university as reorganized, and benefits that might have accrued to the employees to pay them separation pay or retirement pay and concerned at the effective date of reorganization. other accrued benefits under the existing laws or The University started the implementation of its the universitys policy whichever is higher. The retrenchment program with the issuance of a petitioners also question the resolution of the memorandum-circular dated October 14, 1983 NLRC denying the petitioners motion for from the Executive Committee of the Board of reconsideration of the decision for having been Trustees wherein the following guidelines were filed out of time. stated for the information of all faculty members The antecedent facts are summarized as follows: and employees of the University: 304 1 1.All ad hoc, ad interim and temporary 30 SUPREME COURT REPORTS ANNOTATED appointments will be considered terminated 4 as of the date indicated in their respective Gregorio Araneta University Foundation vs. NLRC appointments, or as of October 31, 1983, On March 15, 1983, the president of Gregorio whichever is earlier; Araneta University Foundation, (hereinafter called 2 2.GAUF faculty members and associates are University) Mr. Cesar A. Mijares wrote the then invited to submit courtesy letters of Minister of Labor Blas Ople soliciting his opinion on resignation to the Executive Vice-President a proposed retrenchment and reorganization on or before October 31, 1983. Those who program made necessary by the Universitys submit may be re-appointed while those who Gregorio Araneta University Foundation vs. NLRC would fail to submit may be retrenched; who has served the university for 23 years; 2) 3 3.In order not to prejudice the operations of Rosario Reyes, wife of Victor Reyes, head of the the Foundation, temporary appintments shall department of food technology and concurrently be made by the Acting President. This should manager for food processing who has served the not be considered as preferential or priority university as full-time faculty member for 22 years; right of the temporary appointees. The 3) Billy T. Vicario, head of the department of soil normal procedure of appointment by the science, and assistant dean of the institute of Board of Trustees shall be observed; agriculture who has served the university for 19 4 4.As required by law, the appropriate notice to years; 4) Corazon Vicario, wife of Billy Vicario, dean the Ministry of Labor and Employment will be of the institute of arts and sciences who has served filed immediately by the GAUF the university for 25 years; 5) Luis Almazan, head of Administration; the department of biology who has served the 5 5.The re-appointment of faculty members and university for 28 years and 6) Remigio Perez, full- personnel shall be subject to such terms and time associate professor and department head of conditions as may be proposed by the Spanish who has served the university for 18 years. Administration to the Board of Trustees and The private respondents did not submit their approved by the latter, (p. 45, Rollo) courtesy resignations. The private respondents are: 1) Victor Reyes, Mr. Obed Meneses acting president of the institute dean and concurrently department head university served on the six above-named faculty and a farm administrator members notices of termination, all dated 305 November 10, 1983, and effective November 11, VOL. 155, OCTOBER 29, 1987 1983. 305 The private respondents responded to Meneses given to them prior to their dismissal because as action by filing cases for illegal dismissal, non- early as May 1983, the then president Mijares had payment of separation pay, and other benefits and publicly announced the proposals for a new unfair labor practice with damages against the working structure as a result of which several university and Meneses before the National Labor meetings Relations Commission. The cases were 306 consolidated and assigned to Labor Arbiter Porfirio 30 SUPREME COURT REPORTS ANNOTATED Villanueva. 6 In their position paper, the complainants alleged Gregorio Araneta University Foundation vs. NLRC that they were dismissed without prior notice in were held with the faculty members and other violation of BP 130; that the implementation of the personnel with their respective unions; that the 30- retrenchment program was without any day notice envisioned in BP. 130 was substantially established criteria for selecting the faculty complied with because in their letters of members to be dismissed, as, in fact, they were termination it is stated that It is understood that replaced by faculty members with qualifications your name shall still be included in the payroll for inferior to the complainants; and that their one month after said date and that actually the discharge from employment was a retaliatory complainants received the terminal 30-day pay move against them by Obed Meneses for their whose operative effect is to put them in estoppel having been instrumental in charging him with to question their dismissal; that the complainants having committed various anomalies in the dismissal was due to the non-submission of their university administration. resignation letters as directed and their failure to The university denied the respondents allegations conform to the new terms and conditions of the and stated in its answer that sufficient notice was reorganized set-up and not as a retaliation move against the complainants; and that the complainants appointments as institute deans and other accrued benefits under the existing laws or GAUFs department heads were merely ad hoc or policy, whichever is higher. temporary and had expired on October 15,1983 as The Decision appealed from is modified accordingly. (pp. 200-201, Rollo). indicated in their appointment papers which they The petitioners motion for reconsideration was signed resulting in their termination even without denied for the retrenchment program. 307 On the basis of the parties position papers and VOL. 155, OCTOBER 29, 1987 documentary evidence, Labor Arbiter Porfirio Gregorio Araneta University Foundation vs. NLRC Villanueva rendered a decision upholding the having been filed out of time. Hence, this petition. dismissal of the complainants. The university was In a resolution dated July 29, 1987, we gave due ordered to pay the complainants termination course to the petition. benefit in accordance with law including those The petitioners contend: already earned at the time of their termination. First: In ruling that all the employees should first The complainants appealed the decision to the be retrenched and paid separation/retirement National Labor Relations Commission. In a decision benefits which would amount to millions of dated April 10, 1986, the NLRC en banc modified pesos, and thereafter, all of them be rehired the Labor Arbiters decision. under new terms of employment, the NLRC The dispositive portion of the decision reads: negated the essence and imperatives of WHEREFORE, the respondents are hereby ordered to reinstate all the complainants except Samuel G. Ramos in retrenchment and gave Minister Oples advisory their former positions, with full back wages under the new opinion the binding force of an administrative terms and conditions of employment in the respondent order or decision in an adversarial proceeding. University as reorganized, and to pay them (again, with the Instead of helping save a noble institution, it exception of Ramos) separation pay or retirement pay and would bring about its (GAUF) collapse with consequent lay off of all its remaining personnel closure. The main issue is whether or not the and the displacement of students. private respondents were dismissed within the Second: In refusing to submit their courtesy context and spirit of the retrenchment program resignations and to accept the reduced terms adopted by the university. and conditions of employment as required by The letter of the petitioner university through its GAUFs memorandum-circular (Annex B then President Cesar A. Mijares to the Minister hereof) and in accepting their 30-day terminal of Labor Bias Ople informing the latter of its pay, the complainants forfeited/waived their financial predicament reads as follows: right to be re-appointed or re-instated. There This University can no longer afford to continue operation was no illegal dismissal. under the present salary rates of its personnel. The reduction of per- Third: In peremptorily denying petitioners motion 308 for reconsideration for having been filed 30 SUPREME COURT REPORTS ANNOTATED beyond the 10 calendar days based on alleged 8 prescribed rules not specified and possibly Gregorio Araneta University Foundation vs. NLRC non-existing, and in thereby refusing to pass sonnel is not an adequate solution to this problem, upon the merits of the pleading, the NLRC acted because to do so would not enable the University to capriciously and in disregard of due process. accommodate its present enrolment, x x x. (pp. 33, 36 and 39, Rollo) xxx xxx xxx There is no dispute that the petitioner university xxx xxx xxx was in financial distress. Both parties agree on Reducing the salaries of personnel even to an amount the necessity and indispensability of a which is not below the statutory minimum is not legally allowable. Therefore, the only effective solution is for the retrenchment program which could remedy the University to have all its personnel resign and pay them imminent danger of the universitys total their separation pays, or retirement pays, whichever is higher, so that it could effect a top-to-bottom and reorganization plan, the following measures are reorganization and restructure its salary rates and other envisaged: benefits not mandated by law but were only granted 1 1.a top-to-bottom, University-wide reorganization, unilaterally by the University to its employees long before functional and structural scope, as well as the present hard times of inflation. restructuring of salary rates and other personnel After we have paid our employees their benefits not mandated by existing labor standard separation/retirement pays, we will immediately rehire laws; them in accordance with new and restructured salary rates 2 2.separation or retirement of ALL personnel with which are not, of course below the statutory minimum and corresponding grants of termination pay or without the benefits not mandated by law and/or paying retirement benefits, our faculty members on the hourly basis, subject to the 309 Universitys actual needs under its reorganized set-up. VOL. 155, OCTOBER 29, 1987 In this connection, we would like to seek in advance the Gregorio Araneta University Foundation vs. NLRC opinion of the Ministry of Labor and Employment if this 1 whichever is higher; University could effect the retrenchment and restructuring 2 3.re-hiring of ALL personnel so separated or retired of salary rates above explained in accordance with P.D. No. under terms and conditions of employment to be 442, otherwise known as the Labor Code of the Philippines, established for the reorganized University as amended by B.P. Blg. 130. Foundation, with the possible exception of those We would appreciate it very much if your good office whose present positions will be affected by the could give our inquiry your most preferential proposed reorganizational changes. consideration. (Annex N, herein Private Respondents As explained in your letter, the plan to restructure and Position Paper). (pp. 253-255, Rollo; emphasis supplied) reorganize the University is premised on one over-riding In reply, the then Minister of Labor Bias Ople sent consideration; to continue the operation of the University a letter to the university the pertinent portion of Foundation as an educational institution WITHOUT which reads: imposing additional burden on the student body by way of We understand that under the proposed retrenchment tuition fee increases. We note that, on the one hand, most of your students Taking into consideration these two documents, it came from low-income families which can hardly absorb can be seen that the NLRC was correct in stating any increase under existing schedule of tuition fees. On the that: other hand, your operating costs, particularly personnel x x x x x x x x x overhead, had so greatly outpaced revenues from tuition x x x [T]he basic and salient features of the reorganization and other student fees that the University has been in the plan are couched in clear terms which leave no room for red since 1980 with an average deficit of about interpretation. Specifically, the plan calls for the P866,000.00. separation or retirement of all per- On the basis of the foregoing considerations, we find no 310 serious objections that may be interposed to the proposed 310 SUPREME COURT REPORTS ANNOTATED reorganization and retrenchment program of the Gregorio Araneta University Foundation vs. NLRC University Foundation. Implementation of this program sonnel with corresponding grant of termination pay or shall of course be instituted without prejudice to whatever retirement benefits, whichever is higher. This phrase benefits that might have accrued to the employees connotes authority to effect dismissal of personnel in the concerned at the effective date of reorganization. (Annex implementation of a top-to-bottom, University-wide A, Petition). (At pp. 255-256, Rolo; Emphasis supplied). reorganization, subject, however, to the condition of These two documents outline the approved rehiring of ALL personnel so separated or retired. (pp. scheme for the retrenchment program of the 197-198, Rollo) university. The letter of Minister Ople shows that The rehiring of ALL personnel so separated or he merely confirmed the guidelines set up by the retired was, however, subject to the exception of petitioner university to implement its those whose present positions will be affected by retrenchment program. It is to be noted that the the proposed reorganizational changes. The NLRC petitioner university did not question the took this into consideration when it ruled that the interpretation made by Minister Ople regarding its private respondents were illegally dismissed by the proposals for the retrenchment program. petitioners. Thus, the NLRC said: x x x x x x x x x that under the reorganizational set up, all the x x x [T]he complainantsdischarge from the service was employees of the university would be considered evidently the result of the implementation of the separated or retired with corresponding grants of reorganizational program. Considering, however, that all termination pay or retirement benefits, whichever of them were not rehired to their former positions as Institute Deans and Department Heads, positions, is incidentally, that were not affected by the reorganizational 311 changes, the respondents act in this respect contradicted VOL. 155, OCTOBER 29, 1987 their own program which the Labor Minister himself had Gregorio Araneta University Foundation vs. NLRC in effect approved of. x x x. higher. and all would be rehired except those x x x x x x x x x whose present positions will be affected by the It is clear, therefore, that the respondents failure to proposed reorganizational changes. All the rehire the complainants in their former positions, which, to repeat, were not abolished as a result of the employees were, therefore, considered resigned reorganization, pursuant to their own reorganization plan, under the reorganizational set up without any need amounted to dismissal which was illegal because it was for the courtesy resignations demanded by the effected for no valid reason, x x x. (pp. 198-199, Rollo) petitioner university in its memorandum-circular. The failure of the private respondents to file their The resignations or retirement of the employees courtesy resignations cannot automatically result are, of course, subject to the proviso that their in dismissal or inclusion in the retrenchment. We positions have been abolished by the agree with the NLRC that such courtesy letters of reorganizational set up envisioned in the resignations were merely administrative retrenchment program. In the case of the private requirements that could be dispensed with in the respondents, their positions were not abolished. implementation of the retrenchment program. Hence, there is no basis for their being considered The guidelines of the retrenchment program as retired or separated from the university. approved by the Minister of Labor specifically state The contention of the university that the private respondents positions are temporary in nature as deans and department heads of the petitioner indicated in their appointments is not well taken. university are necessary in its usual business. The fact that the petitioners voluntarily signed the Moreover, all the private respondents have been appointments extended to them does not make serving the university from eighteen (18) to them temporary employees. Article 281 of the twenty-eight (28) years. All of them rose from the Labor Code provides: ranks Regular and Casual Employment.The provisions of 312 written agreement to the contrary notwithstanding and 31 SUPREME COURT REPORTS ANNOTATED regardless of the oral agreements of the parties, an 2 employment shall be deemed to be regular where the Gregorio Araneta University Foundation vs. NLRC employee has been engaged to perform activities which are usually necessary or desirable in the usual business or starting as instructors until they became deans and trade of the employer, except where the employment has department heads of the university. A person who been fixed for a specific project or undertaking the has served the University for 28 years and who completion or termination of which has been determined occupies a high administrative position in addition at the time of the engagement of the employee or where to teaching duties could not possibly be a the work or services to be performed is seasonal in nature temporary employee or a casual. and the employment is for the duration of the season. Hence, there is no merit in the universitys An employment shall be deemed to be casual if it is not covered by the preceding paragraph: Provided, That any argument that the private respondents employee who has rendered at least one year of service, employment with it expired on October 15,1983 as whether such service is continuous or broken shall be indicated in their appointments. considered a regular employee with respect to the activity On the proposition that the private respondents in which he is employed and his employment shall are estopped from questioning their dismissal continue while such actually exists. because they accepted their 30-day termination Undoubtedly, the private respondents positions as pay, suffice it to state that the private respondents cannot waive their rights protected by no less than deduction. No costs. **
the Constitution. Section 18, Article 11 of the 1987 SO ORDERED.
Constitution provides that The state affirms labor Fernan (Chairman), Feliciano, Bidin and as a primary social economic force. It shall protect Cortes, JJ, con- the rights of workers and promote their welfare. ______________ ** (Flexo Manufacturing Corporation v. National Labor This constitutional protection to labor has been Relations Commission, 135 SCRA 145; Hope Christian High carried through all our three (3) constitutions since School v. National Labor Relations Commission, 135 SCRA 251; 1935. and Union of Supervisors (R.B.)-NATU v. Secretary of Labor, 109 The appeal to the Court about saving a noble SCRA 139). institution from collapse has no basis. 313 Retrenchments are allowed for all unnecessary VOL. 155, OCTOBER 30, 1987 positions based on the petitioners own Republic vs. Reyes reorganization program. However, the cur. reorganization cannot be used as a convenient Petition dismissed; decision affirmed device to get rid of existing personnel in order to Notes.Compelling petitioner to continue replace them with new ones. For this purpose, the employing private respondents despite serious regular rules and procedures on dismissal of business losses of petitioner would be oppressive. employees will have to be followed. (Columbia Development Corporation vs. Minister of WHEREFORE, the instant petition is hereby Labor and Employment, 146 SCRA 421.) DISMISSED. The questioned decision of the Termination of employment of any employee National Labor Relations Commission is AFFIRMED, due to retrenchment to prevent losses shall entitle but payment of backwages shall be limited to the employee affected to separation pay. THREE (3) YEARS without qualification and (Columbia Development Corporation vs. Ministry of Labor and Employment, 146 SCRA 421.) o0o Copyright 2016 Central Book Supply, Inc. All rights reserved.