Asia Fancy Plywood Corp. v. NLRC

G.R. No. 113099 (January 20, 1999)

Facts:

Private respondents, who were regular employees of Asia Fancy Plywood Corporation, filed a complaint against the petitioner on March 7, 1991, alleging unfair labor practices, illegal dismissal, harassment, violation of labor standards, and underpayment of wages. The complaint was subsequently amended to include additional complainants and later limited to the issue of illegal dismissal.

In response, the petitioner contended that the private respondents were not dismissed but rather failed to report for work. On December 3, 1991, the Labor Arbiter ruled in favor of the petitioner, ordering the private respondents to report for work and requiring the petitioner to accept them back into their former or substantially equal positions, but without any back wages.

Dissatisfied with this decision, the private respondents appealed to the National Labor Relations Commission (NLRC). On September 30, 1993, the NLRC modified the Labor Arbiter's decision, ordering the petitioner not only to reinstate the private respondents but also to pay them back wages not exceeding two years. This led to the present petition for certiorari filed by the petitioner to nullify the NLRC's decision.

Legal Issues:

1. Whether the private respondents were illegally dismissed from their employment.
2. Whether the NLRC erred in ordering the payment of back wages to the private respondents despite the absence of evidence of illegal dismissal.

Arguments:

• Petitioner’s Argument: The petitioner argued that the private respondents were not dismissed and that they had simply failed to report for work. The petitioner maintained that there was no evidence to support the claim of illegal dismissal and that it had expressed a willingness to reinstate the private respondents. The petitioner contended that back wages should only be awarded in cases of unjust or illegal dismissal, which was not applicable in this case.

• Respondents’ Argument: The private respondents contended that they were effectively dismissed from their positions, which warranted their claims for reinstatement and back wages. They argued that the NLRC's decision to award back wages was justified given the circumstances surrounding their employment and the alleged dismissal.

Court’s Decision and Legal Reasoning:

The Supreme Court granted the petition and set aside the NLRC's decision. The Court found that the Labor Arbiter's original ruling was supported by the evidence, which indicated that the private respondents had not been dismissed. The Court emphasized that the mere assertion of dismissal by the private respondents was unsubstantiated and that the petitioner had shown a willingness to accept them back into their positions.

The Court reiterated that back wages are only granted in cases of illegal dismissal, as outlined in Article 279 of the Labor Code. Since the evidence did not support a finding of illegal dismissal, the NLRC's order for back wages was deemed a grave abuse of discretion. Consequently, the Court reinstated the Labor Arbiter's decision, which did not award back wages.

Significant Legal Principles or Doctrines Established:

1. Illegal Dismissal: The Court reaffirmed that for an employee to be entitled to back wages, there must be a finding of illegal or unjust dismissal.
2. Burden of Proof: The burden of proof lies with the employee to establish the fact of dismissal, and mere allegations without supporting evidence are insufficient.
3. Discretion of Labor Arbiter: The decision of the Labor Arbiter, when supported by evidence, should be upheld unless there is a clear showing of abuse of discretion by the NLRC.