March 2011 - Philippine Supreme Court Resolutions
Philippine Supreme Court Resolutions
[G.R. No. 152166 : March 28, 2011]
ST. LUKE'S MEDICAL CENTER, INC. AND ROBERT KUAN, CHAIRMAN V. ESTRELITO NOTARIO
G.R. No. 152166 (St. Luke's Medical Center, Inc. and Robert Kuan, Chairman v. Estrelito Notario) � On March 19, 1997, respondent Estrelito Notario filed a Complaint for illegal dismissal against petitioner St. Luke's Medical Center, Inc. and its Chairman, Robert Kuan, seeking reinstatement with payment of full back wages from the time of his dismissal up to actual reinstatement, without of loss of seniority rights and other benefits.
On November 11, 1998, the Labor Arbiter declared respondent's termination from employment to be valid, and dismissed his complaint for illegal dismissal against the petitioners.
On appeal by the respondent, the National Labor Relations Commission (NLRC) issued a Resolution dated January 19, 2000, reversing the Decision of the Labor Arbiter. The NLRC ordered the petitioner to reinstate respondent to his former position without loss of seniority rights and other benefits and full backwages from the date of dismissal until actual reinstatement, and should reinstatement be no longer feasible, to further pay him separation pay equivalent to one (1) month pay for every year of service, with the following monetary award, namely, backwages of P250,229.97 and separation pay of P31,365.00, or a total amount of P281,594.97
In the Resolution dated March 20, 2000, the NLRC denied petitioners� motion for reconsideration.
On September 21, 2001, the Court of Appeals (CA) rendered a Decision affirming the Resolutions dated January 19, 2000 and March 20, 2000 of the NLRC.
As their motion for reconsideration was denied m the CA�s Resolution dated February 12, 2002, petitioners filed a petition for review on certiorari before the Court.
In a Decision[1] dated October 20, 2010, the Court denied petitioners� petition and affirmed the Decision dated September 21, 2001 and Resolution dated February 12, 2002 of the CA.
On November 18, 2010, respondent filed the present Motion for Clarification or Partial Reconsideration stating that on February 19, 2010, petitioner hospital, through its Labor Relations Manager, issued a "Reassignment Order (Actual Reinstatement)"[2] which directed him to report back to work starting on March 1, 2010. Thus, respondent seeks a recomputation of his backwages, considering the supervening event that he had been reinstated as of March 1, 2010. He claims that he was reinstated with a salary of only P11,620.00 per month, without according him the corresponding rate increases mandated by the collective bargaining agreements from the time he was illegally terminated until his actual reinstatement. He argues that he was deprived of his seniority rights and benefits from 1997 to 2010 and, that rightfully, he should be receiving more than P24,000.00 monthly. He also points out that petitioners refused to adjust his salary rate even though his former colleagues are now receiving more than P26,000.00 monthly.
In their Comment dated February 17, 2011, petitioners counter that they reinstated respondent on March 1, 2010, in compliance with the immediately executory nature of the reinstatement aspect of a labor decision. They aver that the reason why respondent's colleagues have been receiving P26,000.00 monthly salary was because they never committed any infraction against the hospital and they had been performing their duties to the best of their ability.
The respondent's contention has no merit. In Equitable Banking Corporation v. Sadac,[3] the Court stressed that Article 279 of the Labor Code, as amended, mandates that an employee's full backwages shall be inclusive of allowances and other benefits or their monetary equivalent. Salary increases are not akin to allowances or benefits, and cannot be confused with either. The term "allowances" is sometimes used synonymously with "emoluments," as indirect or contingent remuneration, which may or may not be earned, but which is sometimes in the nature of compensation, and sometimes in the nature of reimbursement. Allowances and benefits are granted to the employee apart or separate from, and in addition to the wage or salary. In contrast, salary increases are amounts which are added to the employee's salary as an increment thereto for varied reasons deemed appropriate by the employer. Salary increases are not separate grants by themselves but once granted, they are deemed part of the employee's salary. To extend the coverage of an allowance or a benefit to include salary increases would be to strain both the imagination of the Court and the language of law. To otherwise give the meaning other than what the law speaks for by itself, will open the floodgates to various interpretations. Indeed, if the intent were to include salary increases as basis in the computation of backwages, the same should have been explicitly stated in the same manner that the law used clear and unambiguous terms in expressly providing for the inclusion of allowances and other benefits.[4] As applied to the present case, the basis for the computation of backwages is the wage rate at the time of the employee's dismissal, inclusive of regular allowances that the employee had been receiving as mandated under the law. Thus, respondent's full backwages shall be inclusive only of allowances and other benefits or their monetary equivalent.
As to whether the computation of the award of backwages should be based on current wage level or the wage levels at the time of the dismissal, Equitable Banking Corporation explained that an unqualified award of backwages means that the employee is paid the wage rate at the time of his dismissal. Furthermore, the award of salary differentials is not allowed, the established rule being that upon reinstatement, illegally dismissed employees are to be paid their backwages, without deduction and qualification as to any wage increases or other benefits that may have been received by their co-workers who were not dismissed[5] or as in this case, those who did not commit any infraction.
Neither can respondent lay claim that he should be entitled to the salary increases being enjoyed by his colleagues. While he may be granted the backwages, this does not include the current or prospective salary increases being accorded to the petitioners' employees.
In Equitable Banking Corporation, the Court expounded that salary increases cannot be made a component in the computation of backwages. What is evident is that salary increases are a mere expectancy. They are, by its nature, volatile and are dependent on numerous variables, including the company's fiscal situation and even the employee's future performance on the job, or the employee's continued stay in a position subject to management prerogative to transfer him to another position where his services are needed. In short, there is no vested right to salary increases.[6]
WHEREFORE, the motion for reconsideration of respondent Estrelito Notario is DENIED WITH FINALITY.
SO ORDERED.
Very truly yours,
(Sgd.) MA. LUISA L. LAUREA
Clerk of Court
Endnotes:
[1] Penned by Associate Justice Diosdado M. Peralta, with Associate Justices Antonio T. Carpio, Antonio Eduardo B. Nachura, Teresita J. Leonardo-De Castro, and Jose Catral Mendoza, concurring, Rollo, pp, 270-282.[2] Annex "A" of respondent's Motion for Clarification or Partial Reconsideration, id. at 286. The "Reassignment Order (Actual Reinstatement)" states that:
We are pleased to inform you that the Department Manager of the In-House Security Department (IHSD) had approved your reassignment in the Office of the Employee & Labor Relations Department (EFRD), effective on 01 March 2010.
You are advised to report to the undersigned on or before the said date for your reorientation and appraisal of your updated duties and responsibilities as a Security and Admin Staff. If must be understood that this Reassignment Order (Actual Reinstatement) is contingent upon the finality of the labor case entitled "Estrelito Notario versus St. Luke's Medical Center, et. al." docketed as G.R. No. 152166, pending before the Honorable Supreme Court.
[3] G.R. No. 164772, June 8, 2006, 490 SCRA 380.
[4] Id. at 403-404. (Citations omitted)
[5] Id. at 410, citing Evangelista v. National Labor Relations Commission, 219 SCRA 194 (1995) and Paramount Vinyl Products Corp. v. NLRC, 190 SCRA 525 (1990).
[6] Id. at 412-413.
