FAILURE TO PROVE BONA FIDE SUSPENSION OF OPERATIONS AND GIVE NOTICE TO DOLE AS BASIS OF PLACING EMPLOYEE ON FLOATING STATUS MAY AMOUNT TO ILLEGAL DISMISSAL

The totality of the foregoing circumstances shows that the employer’s acts of not informing the company and the DOLE of the suspension of its operations, failing to prove the bona fide suspension of its business or undertaking, ignoring the company’s follow-ups on a new assignment, and belated sending of letters/notices which were returned to it, resulting in placing the employee on floating status, were done to make it appear as if the employee had not been dismissed. These acts, however, clearly amounted to a dismissal, for which the employer is liable

Airborne Maintenance and Allied Services, Inc. vs. Egos
G.R. No. 222748, April 3, 2019

Bona fide suspension of operation; Floating status; Notice to DOLE; Constructive dismissal; Notices sent as after-thought

Facts:

On April 9, 1992, Petitioners Airborne Maintenance and Allied Services, Inc. and Francis T. Ching (Airborne), a company engaged in providing manpower services to various clients, hired the services of Arnulfo M. Egos (Egos) as Janitor. He was assigned at the Balintawak Branch of Meralco, a client of Airborne.

Almost twenty years thereafter, the contract between Airborne and Meralco-Balintawak Branch expired and a new contract was awarded to Landbees Corporation, and the latter absorbed all employees of Airborne except Egos, who allegedly had a heart ailment. Egos consulted another doctor and, based on the medical result, he was declared in good health and fit to work. He showed the duly issued medical certificate to Airborne but the same was disregarded.

Egos also reported for work but was just ignored by Airborne and was told that there was no work available for him. Feeling aggrieved, he filed a complaint for constructive/illegal dismissal on August 05, 2011. [Note: Inclusion of the dates in this digest is crucial since subsequent notices were later issued which became contentious in the dispute]

Airborne, on the other hand, insisted that Egos was never dismissed from service. It claimed: 1) that when its contract with Meralco-Balintawak Branch was terminated, it directed all its employees including Egos to report to its office for reposting; 2) that when Egos failed to do so, it sent a letter dated August 12, 2011 at Egos’ last known address directing him to report to his new assignment at Meralco Commonwealth Business Center; 3) that said letter, however, was returned to sender with a notation “RTS unknown”; 4) that another letter dated September 21, 2011 was sent to Egos at his last known address reiterating the previous directive; and 5) that the same was again returned with a notation “R TS unknown.”

LA Ruling:

The Labor Arbiter rendered a decision dismissing the complaint for illegal/constructive dismissal.

On appeal to the NLRC, Egos reiterated that he was constructively/illegally dismissed by Airborne. He pointed out that he made several follow-ups since but Airborne merely ignored him, and since then, he was not given a new assignment.

Egos further argued that the letters were mere afterthoughts since Airborne was already aware of the illegal dismissal complaint prior to the sending of the said letters; that the same could not possibly reach him because his address was incomplete and such mistake was intentionally done for him not to receive the letters; and that he left his cellphone number with one Christine Solis, Airborne’s Administrative Officer, but he never received a call from Airborne.

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Airborne countered that Egos introduced for the first time on appeal not only new factual allegations but also spurious, fabricated and self-serving evidence which should not be given credence.

NLRC Ruling:

The NLRC rendered a decision reversing the findings of the Labor Arbiter and declaring Egos to have been constructively/illegally dismissed.

Airborne filed a petition for certiorari with the CA.

CA Ruling:

The CA however, affirmed the Decision of the NLRC.

Airborne moved for reconsideration, but this was denied. Hence, the Petition before the SC.

Issue/s:

Whether or not the acts of the employer of not informing the employee and the DOLE of the suspension of its operations, failing to prove the bona fide suspension of its business or undertaking, ignoring the employee’s follow-ups on a new assignment, and belated sending of letters/notices which were returned to it, support the claim that the employee was constructively dismissed from service

SC Ruling:

The SC denied the petition.

The SC held that Airborne failed to prove that the termination of the contract with Meralco resulted in a bona fide suspension of its business operations so as to validly place Egos in a floating status.

The suspension of employment under Article 301 of the Labor Code is only temporary and should not exceed six months, as the Court explained in PT & T Corp. v. National Labor Relations Commission. The decision states that Article 286 [now Article 301] may be applied but only by analogy to set a specific period that employees may remain temporarily laid-off or in floating status. Six months is the period set by law that the operation of a business or undertaking may be suspended thereby suspending the employment of the employees concerned. The temporary lay-off wherein the employees likewise cease to work should also not last longer than six months. After six months, the employees should either be recalled to work or permanently retrenched following the requirements of the law, and that failing to comply with this would be tantamount to dismissing the employees and the employer would thus be liable for such dismissal.

In implementing this measure, jurisprudence has set that the employer should notify the Department of Labor and Employment (DOLE) and the affected employee, at least one month prior to the intended date of suspension of business operations. An employer must also prove the existence of a clear and compelling economic reason for the temporary shutdown of its business or undertaking and that there were no available posts to which the affected employee could be assigned.

The Court explained in Lopez vs. Irvine Construction Corp. that the paramount consideration should be the dire exigency of the business of the employer that compels it to put some of its employees temporarily out of work. The employer should also bear the burden of proving that there are no posts available to which the employee temporarily out of work can be assigned.

Here, a review of the submissions of the parties shows that Airborne failed to show compliance with the notice requirement to the DOLE and Egos. Making matters worse for Airborne, it also failed to prove that after the termination of its contract with Meralco it was faced with a clear and compelling economic reason to temporarily shut down its operations or a particular undertaking. It also failed to show that there were no available posts to which Egos could be assigned.

Also, not only did Airborne fail to prove it had valid grounds to place Egos on a floating status, but the NLRC and the CA both correctly found that Egos even had to ask for a new assignment from Airborne, but this was unheeded. Further, when Egos filed the complaint on August 5, 2011, Airborne, as an afterthought, subsequently sent notices/letters to Egos directing him to report to work. These, however, were not received by Egos as the address was incomplete.

Here, the totality of the foregoing circumstances shows that Airborne’s acts of not informing Egos and the DOLE of the suspension of its operations, failing to prove the bona fide suspension of its business or undertaking, ignoring Egos’ follow-ups on a new assignment, and belated sending of letters/notices which were returned to it, were done to make it appear as if Egos had not been dismissed. These acts, however, clearly amounted to a dismissal, for which Airborne is liable.

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