When separation pay is awarded
Virgilio O. Villastique was hired by HSY Marketing Ltd. Co. as field driver tasked to deliver ready-to-wear items and/or general merchandise.
He filed a complaint for illegal dismissal with money claims against HSY Marketing, for allegedly withholding his salary for his refusal to resign.
Petitioner invoked the defense that since respondent was the one who refused to report for work, he should be considered as having voluntarily severed his own employment. Thus, his money claims cannot prosper, as he was not dismissed from the service.
The Labor Arbiter (LA) dismissed the charge of illegal dismissal, finding no evidence to substantiate respondent’s claim that he was dismissed from his job. There was likewise no evidence submitted by petitioner that respondent had indeed voluntarily resigned. He ruled that the employer-employee relationship between the parties should be maintained. Finding however, strained relations between the parties, he did not order the reinstatement of respondent, and instead directed petitioner to pay him the amount of P86,580.00 as separation pay.
The National Labor Relations Commission (NLRC) affirmed the finding of the LA. The Court of Appeals (CA) in turn affirmed in toto the resolution of the NLRC. Petitioner imputes error, in among others, the award of separation pay. Does the contention find merit?
Ruling: Yes.
The Court likewise upholds the unanimous conclusion of the lower tribunals that respondent had not been dismissed at all. Other than the latter’s unsubstantiated allegation of having been verbally terminated from his work, no substantial evidence was presented to show that he was indeed dismissed or was prevented from returning to his work. In the absence of any showing of an overt or positive act proving that petitioner had dismissed respondent, the latter’s claim of illegal dismissal cannot be sustained, as such supposition would be self-serving, conjectural, and of no probative value.
Similarly, petitioner’s claims of respondent’s voluntary resignation and/or abandonment deserve scant consideration, considering petitioner’s failure to discharge the burden of proving the deliberate and unjustified refusal of respondent to resume his employment without any intention of returning. It was incumbent upon petitioner to ascertain respondent’s interest or non-interest in the continuance of his employment, but to no avail.
Since there is no dismissal or abandonment to speak of, the appropriate course of action is to reinstate the employee (in this case, herein respondent) without, however, the payment of backwages.
Notably, the reinstatement ordered here should not be construed as a relief proceeding from illegal dismissal; instead, it should be considered as a declaration or affirmation that the employee may return to work because he was not dismissed in the first place. For this reason, the Court agrees with petitioner that the LA, the NLRC, and the CA erred in awarding separation pay in spite of the finding that respondent had not been dismissed.
Properly speaking, liability for the payment of separation pay is but a legal consequence of illegal dismissal where reinstatement is no longer viable or feasible. As a relief granted in lieu of reinstatement, it goes without saying that an award of separation pay is inconsistent with a finding that there was no illegal dismissal. This is because an employee who had not been dismissed, much less illegally dismissed, cannot be reinstated. Moreover, as there is no reinstatement to speak of, respondent cannot invoke the doctrine of strained relations to support his prayer for the award of separation pay. x x x.
In fine, petitioner is ordered to reinstate respondent to his former position without the payment of backwages. If respondent voluntarily chooses not to return to work, he must then be considered as having resigned from employment. This is without prejudice, however, to the willingness of both parties to continue with their former contract of employment or enter into a new one whenever they so desire. (Perlas-Bernabe, J.; SC 1st Division, HSY Marketing Ltd., Co. vs. Virgilio O. Villastique, G.R. No. 219569, Aug 17, 2016).
Liability for the payment of separation pay is but a legal consequence of illegal dismissal where reinstatement is no longer viable or feasible.