EN BANC
G.R. No. 178083, March 13, 2018
FLIGHT ATTENDANTS AND STEWARDS ASSOCIATION OF THE PHILIPPINES (FASAP), Petitioner, v. PHILIPPINE AIRLINES, INC., PATRIA CHIONG AND THE COURT OF APPEALS, Respondents.
A.M. No. 11-10-1-SC, March 13, 2018
IN RE: LETTERS OF ATTY. ESTELITO P. MENDOZA RE: G.R. NO. 178083 - FLIGHT ATTENDANTS AND STEWARDS ASSOCIATION OF THE PHILIPPINES (FASAP) VS. PHILIPPINE AIRLINES, INC., ET AL.
R E S O L U T I O N
BERSAMIN, J.:
In determining the validity of a retrenchment, judicial notice may be taken of the financial losses incurred by an employer undergoing corporate rehabilitation. In such a case, the presentation of audited financial statements may not be necessary to establish that the employer is suffering from severe financial losses.
Before the Court are the following matters for resolution, namely:
(a) Motion for Reconsideration of the Resolution of October 2, 2009 and Second Motion for Reconsideration of the Decision of July 22, 2008 filed by respondents Philippine Airlines, Inc. (PAL) and Patria Chiong;1 and (b) Motion for Reconsideration [Re: The Honorable Court's Resolution dated 13 March 2012]2 of petitioner Flight Attendants and Stewards Association of the Philippines (FASAP).
WHEREFORE, the instant petition is GRANTED. The assailed Decision of the Court of Appeals in CA-G.R. SP No. 87956 dated August 23, 2006, which affirmed the Decision of the NLRC setting aside the Labor Arbiter's findings of illegal retrenchment and its Resolution of May 29, 2007 denying the motion for reconsideration, are REVERSED and SET ASIDE and a new one is rendered:The Third Division thereby differed from the decision of the Court of Appeals (CA), which had pronounced in its appealed decision promulgated on August 23, 20066 that the remaining issue between the parties concerned the manner by which PAL had carried out the retrenchment program.7 Instead, the Third Division disbelieved the veracity of PAL's claim of severe financial losses, and concluded that PAL had not established its severe financial losses because of its non-presentation of audited financial statements. It further concluded that PAL had implemented the retrenchment program in bad faith, and had not used fair and reasonable criteria in selecting the employees to be retrenched.1. FINDING respondent Philippine Airlines, Inc. GUILTY of illegal dismissal;SO ORDERED.5
2. ORDERING Philippine Airlines, Inc. to reinstate the cabin crew personnel who were covered by the retrenchment and demotion scheme of June 15, 1998 made effective on July 15, 1998, without loss of seniority rights and other privileges, and to pay them full backwages, inclusive of allowances and other monetary benefits computed from the time of their separation up to the time of their actual reinstatement, provided that with respect to those who had received their respective separation pay, the amounts of payments shall be deducted from their backwages. Where reinstatement is no longer feasible because the positions previously held no longer exist, respondent Corporation shall pay backwages plus, in lieu of reinstatement, separation pay equal to one (1) month pay for every year of service;
3. ORDERING Philippine Airlines, Inc. to pay attorney's fees equivalent to ten percent (10%) of the total monetary award.
Costs against respondent PAL.
Upon conclusion of the oral arguments, the Court directed the parties to explore a possible settlement and to submit their respective memoranda.10I
WHETHER THE GROUNDS FOR RETRENCHMENT WERE ESTABLISHEDII
WHETHER PAL RESORTED TO OTHER COST-CUTTING MEASURES BEFORE IMPLEMENTING ITS RETRENCHMENT PROGRAMIII
WHETHER FAIR AND REASONABLE CRITERIA WERE FOLLOWED IN IMPLEMENTING THE RETRENCHMENT PROGRAMIV
WHETHER THE QUITCLAIMS WERE VALIDLY AND VOLUNTARILY EXECUTED
WHEREFORE, for lack of merit, the Motion for Reconsideration is hereby DENIED with FINALITY. The assailed Decision dated July 22, 2008 is AFFIRMED with MODIFICATION in that the award of attorney's fees and expenses of litigation is reduced to P2,000,000.00. The case is hereby REMANDED to the Labor Arbiter solely for the purpose of computing the exact amount of the award pursuant to the guidelines herein stated.The Special Third Division was unconvinced by PAL's change of theory in urging the June 1998 Association of Airline Pilots of the Philippines (ALPAP) pilots' strike as the reason behind the immediate retrenchment; and observed that the strike was a temporary occurrence that did not require the immediate and sweeping retrenchment of around 1,400 cabin crew.
No further pleadings will be entertained.
SO ORDERED.13
To summarize all the developments that brought about the present dispute-expressed in a format that can more readily be appreciated in terms of the Court en banc's ruling to recall the September 7, 2011 ruling - the FASAP case, as it developed, was attended by special and unusual circumstances that saw:In the same resolution of March 13, 2012, the Court En Banc directed the re-raffle of G.R. No. 178083 to the remaining Justices of the former Special Third Division who participated in resolving the issues pursuant to Section 7, Rule 2 of the Internal Rules of the Supreme Court, explaining:
(a) the confluence of the successive retirement of three Justices (in a Division of five Justices) who actually participated in the assailed Decision and Resolution;
(b) the change in the governing rules-from the A.M.s to the IRSC regime-which transpired during the pendency of the case;
(c) the occurrence of a series of inhibitions in the course of the case (Justices Ruben Reyes, Leonardo-De Castro, Corona, Velasco, and Carpio), and the absences of Justices Sereno and Reyes at the critical time, requiring their replacement; notably, Justices Corona, Carpio, Velasco and Leonardo-De Castro are the four most senior Members of the Court;
(d) the three re-organizations of the divisions, which all took place during the pendency of the case, necessitating the transfer of the case from the Third Division, to the First, then to the Second Division;
(e) the unusual timing of Atty. Mendoza's letters, made after the ruling Division had issued its Resolution of September 7, 2011, but before the parties received their copies of the said Resolution; and
(f) finally, the time constraint that intervened, brought about by the parties' receipt on September 19, 2011 of the Special Division's Resolution of September 7, 2011, and the consequent running of the period for finality computed from this latter date; and the Resolution would have lapsed to finality after October 4, 2011, had it not been recalled by that date.
All these developments, in no small measure, contributed in their own peculiar way to the confusing situations that attended the September 7, 2011 Resolution, resulting in the recall of this Resolution by the Court en banc.24
On deeper consideration, the majority now firmly holds the view that Section 7, Rule 2 of the IRSC should have prevailed in considering the raffle and assignment of cases after the 2nd MR was accepted, as advocated by some Members within the ruling Division, as against the general rule on inhibition under Section 3, Rule 8. The underlying constitutional reason, of course, is the requirement of Section 4(3), Article VIII of the Constitution already referred to above.This last resolution impelled FASAP to file the Motion for Reconsideration [Re: The Honorable Court's Resolution dated 13 March 2012], praying that the September 7, 2011 resolution in G.R. No. 178083 be reinstated.26
The general rule on statutory interpretation is that apparently conflicting provisions should be reconciled and harmonized, as a statute must be so construed as to harmonize and give effect to all its provisions whenever possible. Only after the failure at this attempt at reconciliation should one provision be considered the applicable provision as against the other.
Applying these rules by reconciling the two provisions under consideration, Section 3, Rule 8 of the IRSC should be read as the general rule applicable to the inhibition of a Member-in-Charge.This general rule should, however, yield where the inhibition occurs at the late stage of the case when a decision or signed resolution is assailed through an MR. At that point, when the situation calls for the review of the merits of the decision or the signed resolution made by a ponente (or writer of the assailed ruling), Section 3, Rule 8 no longer applies and must yield to Section 7, Rule 2 of the IRSC which contemplates a situation when the ponente is no longer available, and calls for the referral of the case for raffle among the remaining Members of the Division who acted on the decision or on the signed resolution. This latter provision should rightly apply as it gives those who intimately know the facts and merits of the case, through their previous participation and deliberations, the chance to take a look at the decision or resolution produced with their participation.
To reiterate, Section 3, Rule 8 of the IRSC is the general rule on inhibition, but it must yield to the more specific Section 7, Rule 2 of the IRSC where the obtaining situation is for the review on the merits of an already issued decision or resolution and the ponente or writer is no longer available to act on the matter. On this basis, the ponente, on the merits of the case on review, should be chosen from the remaining participating Justices, namely, Justices Peralta and Bersamin.25
PAL insists that FASAP, while admitting PAL's serious financial condition, only questioned before the Labor Arbiter the alleged unfair and unreasonable measures in retrenching the employees;29 that FASAP categorically manifested before the NLRC, the CA and this Court that PAL's financial situation was not the issue but rather the manner of terminating the 1,400 cabin crew; that the Court's disregard of FASAP's categorical admissions was contrary to the dictates of fair play;30 that considering that the Labor Arbiter, the NLRC and the CA unanimously found PAL to have experienced financial losses, the Court should have accorded such unanimous findings with respect and finality;31 that its being placed under suspension of payments and corporate rehabilitation and receivership already sufficiently indicated its grave financial condition;32 and that the Court should have also taken judicial notice of the suspension of payments and monetary claims filed against PAL that had reached and had been consequently resolved by the Court.33I
xxx THE HONORABLE COURT ERRED IN NOT GIVING CREDENCE TO THE FOLLOWING COMPELLING EVIDENCE AND CIRCUMSTANCES CLEARLY SHOWING PALS; DIRE FINANCIAL CONDITION AT THE TIME OF THE RETRENCHMENT: (A) PETITIONER'S ADMISSIONS OF PAL'S FINANCIAL LOSSES; (B) THE UNANIMOUS FINDINGS OF THE SECURITIES AND EXCHANGE COMMISSION (SEC), THE LABOR ARBITER, THE NATIONAL LABOR RELATIONS COMMISSION (NLRC) AND THE COURT OF APPEALS CONFIRMING PAL'S FINANCIAL CRISIS; (C) PREVIOUS CASES DECIDED BY THE HONORABLE COURT RECOGNIZING PAL'S DIRE FINANCIAL STATE; AND (D) PAL BEING PLACED BY THE SEC UNDER SUSPENSION OF PAYMENTS AND CORPORATE REHABILITATION AND RECEIVERSHIPII
xxx THERE IS NO SUFFICIENT BASIS FOR THE HONORABLE COURT'S CONCLUSION THAT PAL DID NOT EXERCISE GOOD FAITH [IN] ITS PREROGATIVE TO RETRENCH EMPLOYEESIII
THE HONORABLE COURT'S RULING THAT PAL DID NOT USE FAIR AND REASONABLE CRITERIA IN ASCERTAINING WHO WOULD BE RETRENCHED IS CONTRARY TO ESTABLISHED FACTS, EVIDENCE ON RECORD AND THE FINDINGS OF THE NLRC AND THE COURT OF APPEALS28
PAL contends that the October 2, 2009 resolution focused on an entirely new basis that of PAL's supposed change in theory. It denies having changed its theory, however, and maintains that the reduction of its workforce had resulted from a confluence of several events, like the flight expansion; the 1997 Asian financial crisis; and the ALPAP pilots' strike.38 PAL explains that when the pilots struck in June 1998, it had to decide quickly as it was then facing closure in 18 days due to serious financial hemorrhage; hence, the strike came as the final blow.I
PAL HAS NOT CHANGED ITS POSITION THAT THE REDUCTION OF PAL'S LABOR FORCE OF ABOUT 5,000 EMPLOYEES, INCLUDING THE 1,423 FASAP MEMBERS, WAS THE RESULT OF A CONFLUENCE OF EVENTS, THE EXPANSION OF PAL'S FLEET, THE ASIAN FINANCIAL CRISIS OF 1997, AND ITS CONSEQUENCES ON PAL'S OPERATIONS, AND THE PILOT'S STRIKE OF JUNE 1998, AND THAT PAL SURVIVED BECAUSE OF THE IMPLEMENTATION OF ITS REHABILITATION PLAN (LATER "AMENDED AND RESTATED REHABILITATION PLAN") WHICH INCLUDED AMONG ITS COMPONENT ELEMENTS, THE REDUCTION OF LABOR FORCEII
THE HONORABLE COURT SHOULD HAVE UPHELD PAL'S REDUCTION OF THE NUMBER OF CABIN CREW IN ACCORD WITH ITS ENTRY INTO REHABILITATION AND THE CONSEQUENT TERMINATION OF EMPLOYMENT OF CABIN CREW PERSONNEL AS A VALID EXERCISE OF MANAGEMENT PREROGATIVEIII
PAL HAS SUFFICIENTLY ESTABLISHED THE SEVERITY OF ITS FINANCIAL LOSSES, SO AS TO JUSTIFY THE ENTRY INTO REHABILITATION AND THE CONSEQUENT REDUCTION OF CABIN CREW PERSONNELIV
THE HONORABLE COURT ERRED IN HOLDING THAT THERE WAS NO SUFFICIENT BASIS FOR PAL TO IMPLEMENT THE RETRENCHMENT OF CABIN CREW PERSONNELV
UNDER THE CIRCUMSTANCES, THE PRIOR IMPLEMENTATION OF LESS DRASTIC COST-CUTTING MEASURES WAS NO LONGER POSSIBLE AND SHOULD NOT BE REQUIRED FOR A VALID RETRENCHMENT; IN ANY EVENT, PAL HAD IMPLEMENTED LESS DRASTIC COST-CUTTING MEASURES BEFORE IMPLEMENTING THE DOWNSIZING PROGRAMVI
QUITCLAIMS WERE VALIDLY EXECUTED37
Procedural I
IS THE RESOLUTION DATED OCTOBER 4, 2011 IN A.M. NO. 11-10-1-SC (RECALLING THE SEPTEMBER 7, 2011 RESOLUTION) VOID FOR FAILURE TO COMPLY WITH SECTION 14, RULE VIII OF THE 1987 CONSTITUTION?II
MAY THE COURT ENTERTAIN THE SECOND MOTION FOR RECONSIDERATION FILED BY THE RESPONDENT PAL?
DID PAL LAWFULLY RETRENCH THE 1,400 CABIN CREW PERSONNEL?A
DID PAL PRESENT SUFFICIENT EVIDENCE TO PROVE THAT IT INCURRED SERIOUS FINANCIAL LOSSES WHICH JUSTIFIED THE DOWNSIZING OF ITS CABIN CREW?B
DID PAL OBSERVE GOOD FAITH IN IMPLEMENTING THE RETRENCHMENT PROGRAM?C
DID PAL COMPLY WITH SECTION 112 OF THE PAL-FASAP CBA IN SELECTING THE EMPLOYEES TO BE RETRENCHED?III
ASSUMING THAT PAL VALIDLY IMPLEMENTED ITS RETRENCHMENT PROGRAM, DID THE RETRENCHED EMPLOYEES SIGN VALID QUITCLAIMS?
Section 14. No decision shall be rendered by any court without expressing therein clearly and distinctly the facts and the law on which it is based.The constitutional provision clearly indicates that it contemplates only a decision, which is the judgment or order that adjudicates on the merits of a case. This is clear from the text and tenor of Section 1, Rule 36 of the Rules of Court, the rule that implements the constitutional provision, to wit:
Section 1. Rendition of judgments and final orders. A judgment or final order determining the merits of the case shall be in writing personally and directly prepared by the judge, stating clearly and distinctly the facts and the law on which it is based, signed by him, and filed with the clerk of court.The October 4, 2011 resolution did not adjudicate on the merits of G.R. No. 178083. We explicitly stated so in the resolution of March 13, 2012. What we thereby did was instead to exercise the Court's inherent power to recall orders and resolutions before they attain finality. In so doing, the Court only exercised prudence in order to ensure that the Second Division was vested with the appropriate legal competence in accordance with and under the Court's prevailing internal rules to review and resolve the pending motion for reconsideration. We rationalized the exercise thusly:
As the narration in this Resolution shows, the Court acted on its own pursuant to its power to recall its own orders and resolutions before their finality. The October 4, 2011 Resolution was issued to determine the propriety of the September 7, 2011 Resolution given the facts that came to light after the ruling Division's examination of the records. To point out the obvious, the recall was not a ruling on the merits and did not constitute the reversal of the substantive issues already decided upon by the Court in the FASAP case in its previously issued Decision (of July 22, 2008) and Resolution (of October 2, 2009). In short, the October 4, 2011 Resolution was not meant and was never intended to favor either party, but to simply remove any doubt about the validity of the ruling Division's action on the case. The case, in the ruling Division's view, could be brought to the Court en banc since it is one of "sufficient importance"; at the very least, it involves the interpretation of conflicting provisions of the IRSC with potential jurisdictional implications.It should further be clear from the same March 13, 2012 resolution that the factual considerations for issuing the recall order were intentionally omitted therefrom in obeisance to the prohibition against public disclosure of the internal deliberations of the Court.45
At the time the Members of the ruling Division went to the Chief Justice to recommend a recall, there was no clear indication of how they would definitively settle the unresolved legal questions among themselves. The only matter legally certain was the looming finality of the September 7, 2011 Resolution if it would not be immediately recalled by the Court en banc by October 4, 2011. No unanimity among the Members of the ruling Division could be gathered on the unresolved legal questions; thus, they concluded that the matter is best determined by the Court en banc as it potentially involved questions of jurisdiction and interpretation of conflicting provisions of the IRSC. To the extent of the recommended recall, the ruling Division was unanimous and the Members communicated this intent to the Chief Justice in clear and unequivocal terms.44 (Bold underscoring for emphasis)
Section 6. Harmless error. No error in either the admission or the exclusion of evidence and no error or defect in any ruling or order or in anything done or omitted by the trial court or by any of the parties is ground for granting a new trial or for setting aside, modifying, or otherwise disturbing a judgment or order, unless refusal to take such action appears to the court inconsistent with substantial justice. The court at every stage of the proceedings must disregard any error or defect which does not affect the substantial rights of the parties.The harmless error rule obtains during review of the things done by either the trial court or by any of the parties themselves in the course of trial, and any error thereby found does not affect the substantial rights or even the merits of the case. The Court has had occasions to apply the rule in the correction of a misspelled name due to clerical error;49 the signing of the decedents' names in the notice of appeal by the heirs;50 the trial court's treatment of the testimony of the party as an adverse witness during cross-examination by his own counsel;51 and the failure of the trial court to give the plaintiffs the opportunity to orally argue against a motion.52 All of the errors extant in the mentioned situations did not have the effect of altering the dispositions rendered by the respective trial courts. Evidently, therefore, the rule had no appropriate application herein.
A final point that needs to be fully clarified at this juncture, in light of the allegations of the Dissent is the role of the Chief Justice in the recall of the September 7, 2011 Resolution. As can be seen from the xxx narration, the Chief Justice acted only on the recommendation of the ruling Division, since he had inhibited himself from participation in the case long before. The confusion on this matter could have been brought about by the Chief Justice's role as the Presiding Officer of the Court en banc (particularly in its meeting of October 4, 2011), and the fact that the four most senior Justices of the Court (namely, Justices Corona, Carpio, Velasco and Leonardo-De Castro) inhibited from participating in the case. In the absence of any clear personal malicious participation, it is neither correct nor proper to hold the Chief Justice personally accountable for the collegial ruling of the Court en banc.53 (Bold underscoring supplied for emphasis)To reiterate, the Court, whether sitting En Banc or in Division, acts as a collegial body. By virtue of the collegiality, the Chief Justice alone cannot promulgate or issue any decisions or orders. In Complaint of Mr. Aurelio Indencia Arrienda Against SC Justices Puna, Kapunan, Pardo, Ynares Santiago,54 the Court has elucidated on the collegial nature of the Court in relation to the role of the Chief Justice, viz.:
The complainant's vituperation against the Chief Justice on account of what he perceived was the latter's refusal "to take a direct positive and favorable action" on his letters of appeal overstepped the limits of proper conduct. It betrayed his lack of understanding of a fundamental principle in our system of laws. Although the Chief Justice is primus inter pares, he cannot legally decide a case on his own because of the Court's nature as a collegial body. Neither can the Chief Justice, by himself, overturn the decision of the Court, whether of a division or the en banc.Lastly, any lingering doubt on the validity of the recall order should be dispelled by the fact that the Court upheld its issuance of the order through the March 13, 2012 resolution, whereby the Court disposed:
There is only one Supreme Court from whose decisions all other courts are required to take their bearings. While most of the Court's work is performed by its three divisions, the Court remains one court-single, unitary, complete and supreme. Flowing from this is the fact that, while individual justices may dissent or only partially concur, when the Court states what the law is, it speaks with only one voice. Any doctrine or principle of law laid down by the court may be modified or reversed only by the Court en banc.55
WHEREFORE, premises considered, we hereby confirm that the Court en banc has assumed jurisdiction over the resolution of the merits of the motions for reconsideration of Philippine Airlines, Inc., addressing our July 22, 2008 Decision and October 2, 2009 Resolution; and that the September 7, 2011 ruling of the Second Division has been effectively recalled. This case should now be raffled either to Justice Lucas P. Bersamin or Justice Diosdado M. Peralta (the remaining members of the case) as Member-in-Charge in resolving the merits of these motions.
xxxx
The Flight Attendants and Stewards Association of the Philippines' Motion for Reconsideration of October 17, 2011 is hereby denied; the recall of the September 7, 2011 Resolution was made by the Court on its own before the ruling's finality pursuant to the Court's power of control over its orders and resolutions. Thus, no due process issue ever arose.
SO ORDERED.
Section 3. Second motion for reconsideration. The Court shall not entertain a second motion for reconsideration, and any exception to this rule can only be granted in the higher interest of justice by the Court en banc upon a vote of at least two-thirds of its actual membership. There is reconsideration "in the higher interest of justice" when the assailed decision is not only legally erroneous, but is likewise patently unjust and potentially capable of causing unwarranted and irremediable injury or damage to the parties. A second motion for reconsideration can only be entertained before the ruling sought to be reconsidered becomes final by operation of law or by the Court's declaration.The conditions that must concur in order for the Court to entertain a second motion for reconsideration are the following, namely:
In the Division, a vote of three Members shall be required to elevate a second motion for reconsideration to the Court en banc.
Under the IRSC, a second motion for reconsideration may be allowed to prosper upon a showing by the movant that a reconsideration of the previous ruling is necessary in the higher interest of justice. There is higher interest of justice when the assailed decision is not only legally erroneous, but is likewise patently unjust and potentially capable of causing unwarranted and irremediable injury or damage to the parties.61
- The motion should satisfactorily explain why granting the same would be in the higher interest of justice;
- The motion must be made before the ruling sought to be reconsidered attains finality;
- If the ruling sought to be reconsidered was rendered by the Court through one of its Divisions, at least three members of the Division should vote to elevate the case to the Court En Banc; and
- The favorable vote of at least two-thirds of the Court En Banc's actual membership must be mustered for the second motion for reconsideration to be granted.60
On September 28, 2011, the Letters dated September 13 and 20, 2011 of Atty. Mendoza to Atty. Vidal (asking that his inquiry be referred to the relevant Division Members who took part on the September 7, 2011 Resolution) were "NOTED" by the regular Second Division. The Members of the ruling Division also met to consider the queries posed by Atty. Mendoza. Justice Brion met with the Members of the ruling Division (composed of Justices Brion, Peralta, Perez, Bersamin, and Mendoza), rather than with the regular Second Division (composed of Justices Carpio, Brion, Perez, and Sereno), as the former were the active participants in the September 7, 2011 Resolution.It is well to stress that the Banc could not have assumed jurisdiction were it not for the initiative of Justice Arturo V. Brion who consulted the Members of the ruling Division as well as Chief Justice Corona regarding the jurisdictional implications of the successive retirements, transfers, and inhibitions by the Members of the ruling Division. This move by Justice Brion led to the referral of the case to the Banc in accordance with Section 3(1), Rule 2 of the IRSC that provided, among others, that any Member of the Division could request the Court En Banc to take cognizance of cases that fell under paragraph (m). This referral by the ruling Division became the basis for the Banc to issue its October 4, 2011 resolution.
In these meetings, some of the Members of the ruling Division saw the problems pointed out above, some of which indicated that the ruling Division might have had no authority to rule on the case. Specifically, their discussions centered on the application of A.M. No. 99-8-09-SC for the incidents that transpired prior to the effectivity of the IRSC, and on the conflicting rules under the IRSC - Section 3, Rule 8 on the effects of inhibition and Section 7, Rule 2 on the resolution of MRs.
A.M. No. 99-8-09-SC indicated the general rule that the re-raffle shall be made among the other Members of the same Division who participated in rendering the decision or resolution and who concurred therein, which should now apply because the ruling on the case is no longer final after the cast had been opened for review on the merits. In other words, after acceptance by the Third Division, through Justice Velasco, of the 2nd MR, there should have been a referral to raffle because the excepting qualification that the Clerk of Court cited no longer applied; what was being reviewed were the merits of the case and the review should be by the same Justices who had originally issued the original Decision and the subsequent Resolution, or by whoever of these Justices are still left in the Court, pursuant to the same A.M. No. 99-8-09-SC.
On the other hand, the raffle to Justice Brion was made by applying AC No. 84-2007 that had been superseded by Section 3, Rule 8 of the IRSC. Even the use of this IRSC provision, however, would not solve the problem, as its use still raised the question of the provision that should really apply in the resolution of the MR: should it be Section 3, Rule 8 on the inhibition of a Member-in-Charge, or Section 7, Rule 2 of the IRSC on the inhibition of the ponente when an MR of a decision and a signed resolution was filed. xxxxxxx xxxx xxxx
A comparison of these two provisions shows the semantic sources of the seeming conflict: Section 7, Rule 2 refers to a situation where the ponente has retired, is no longer a Member of the Court, is disqualified, or has inhibited himself from acting on the case; while Section 3, Rule 8 generally refers to the inhibition of a Member-in-Charge who does not need to be the writer of the decision or resolution under review.
Significantly, Section 7, Rule 2 expressly uses the word ponente (not Member-in-Charge) and refers to a specific situation where the ponente (or the writer of the Decision or the Resolution) is no longer with the Court or is otherwise unavailable to review the decision or resolution he or she wrote. Section 3, Rule 8, on the other hand, expressly uses the term Member-in-Charge and generally refers to his or her inhibition, without reference to the stage of the proceeding when the inhibition is made.
Under Section 7, Rule 2, the case should have been re-raffled and assigned to anyone of Justices Nachura (who did not retire until June 13, 2011), Peralta, or Bersamin, either (1) after the acceptance of the 2nd MR (because the original rulings were no longer final); or (2) after Justice Velasco's inhibition because the same condition existed, i.e., the need for a review by the same Justices who rendered the decision or resolution. As previously mentioned, Justice Nachura participated in both the original Decision and the subsequent Resolution, and all three Justices were the remaining Members who voted on the October 2, 2009 Resolution. On the other hand, if Section 3, Rule 8 were to be solely applied after Justice Velasco's inhibition, the Clerk of Court would be correct in her assessment and the raffle to Justice Brion, as a Member outside of Justice Velasco's Division, was correct.
These were the legal considerations that largely confronted the ruling Division in late September 2011 when it deliberated on what to do with Atty. Mendoza's letters.
The propriety of and grounds for the recall of the September 7, 2011 Resolution
Most unfortunately, the above unresolved questions were even further compounded in the course of the deliberations of the Members of the ruling Division when they were informed that the parties received the ruling on September 19, 2011, and this ruling would lapse to finality after the 15th day, or after October 4, 2011.
Thus, on September 30, 2011 (a Friday), the Members went to Chief Justice Corona and recommended, as a prudent move, that the September 7, 2011 Resolution be recalled at the very latest on October 4, 2011, and that the case be referred to the Court en banc for a ruling on the questions Atty. Mendoza asked. The consequence, of course, of a failure to recall their ruling was for that Resolution to lapse to finality. After finality, any recall for lack of jurisdiction of the ruling Division might not be understood by the parties and could lead to a charge of flip-flopping against the Court. The basis for the referral is Section 3(n), Rule 2 of the IRSC, which provides:RULE 2.
OPERATING STRUCTURESSection 3. Court en banc matters and cases. - The Court en banc shall act on the following matters and cases:Ruling positively, the Court en banc duly issued its disputed October 4, 2011 Resolution recalling the September 7, 2011 Resolution and ordering the re-raffle of the case to a new Member-in-Charge. Later in the day, the Court received PAL's Motion to Vacate (the September 7, 2011 ruling) dated October 3, 2011. This was followed by FASAP's MR dated October 17, 2011 addressing the Court Resolution of October 4, 2011. The FASAP MR mainly invoked the violation of its right to due process as the recall arose from the Court's ex parte consideration of mere letters from one of the counsels of the parties.
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(n) cases that the Court en banc deems of sufficient importance to merit its attention[.]
As the narration in this Resolution shows, the Court acted on its own pursuant to its power to recall its own orders and resolutions before their finality. The October 4, 2011 Resolution was issued to determine the propriety of the September 7, 2011 Resolution given the facts that came to light after the ruling Division's examination of the records. To point out the obvious, the recall was not a ruling on the merits and did not constitute the reversal of the substantive issues already decided upon by the Court in the FASAP case in its previously issued Decision (of July 22, 2008) and Resolution (of October 2, 2009). In short, the October 4, 2011 Resolution was not meant and was never intended to favor either party, but to simply remove any doubt about the validity of the ruling Division's action on the case. The case, in the ruling Division's view, could be brought to the Court en banc since it is one of "sufficient importance"; at the very least, it involves the interpretation of conflicting provisions of the IRSC with potential jurisdictional implications.
At the time the Members of the ruling Division went to the Chief Justice to recommend a recall, there was no clear indication of how they would definitively settle the unresolved legal questions among themselves. The only matter legally certain was the looming finality of the September 7, 2011 Resolution if it would not be immediately recalled by the Court en banc by October 4, 2011. No unanimity among the Members of the ruling Division could be gathered on the unresolved legal questions; thus, they concluded that the matter is best determined by the Court en banc as it potentially involved questions of jurisdiction and interpretation of conflicting provisions of the IRSC. To the extent of the recommended recall, the ruling Division was unanimous and the Members communicated this intent to the Chief Justice in clear and unequivocal terms.76 (Bold scoring supplied for emphasis)
It is argued that the assailed Resolutions in the present cases have already become final, since a second motion for reconsideration is prohibited except for extraordinarily persuasive reasons and only upon express leave first obtained; and that once a judgment attains finality, it thereby becomes immutable and unalterable, however unjust the result of error may appear.Lastly, the dissent proposes that a unanimous vote is required to grant PAL's Second Motion for Reconsideration of the Decision of July 22, 2008.80 The dissent justifies the proposal by stating that "[a] unanimous court would debate and deliberate more fully compared with a nonunanimous court."81
The contention, however, misses an important point. The doctrine of immutability of decisions applies only to final and executory decisions. Since the present cases may involve a modification or reversal of a Courtordained doctrine or principle, the judgment rendered by the Special Third Division may be considered unconstitutional, hence, it can never become final. It finds mooring in the deliberations of the framers of the Constitution:On proposed Section 3(4), Commissioner Natividad asked what the effect would be of a decision that violates the proviso that "no doctrine or principle of law laid down by the court in a decision rendered en banc or in division may be modified or reversed except by the court en banc." The answer given was that such a decision would be invalid. Following up, Father Bernas asked whether the decision, if not challenged, could become final and binding at least on the parties. Romulo answered that, since such a decision would be in excess of jurisdiction, the decision on the case could be reopened anytime. (emphasis and underscoring supplied)A decision rendered by a Division of this Court in violation of this constitutional provision would be in excess of jurisdiction and, therefore, invalid. Any entry of judgment may thus be said to be "inefficacious" since the decision is void for being unconstitutional.
While it is true that the Court en banc exercises no appellate jurisdiction over its Divisions, Justice Minerva Gonzaga-Reyes opined in Firestone and concededly recognized that "[t]he only constraint is that any doctrine or principle of law laid down by the Court, either rendered en banc or in division, may be overturned or reversed only by the Court sitting en banc."
That a judgment must become final at some definite point at the risk of occasional error cannot be appreciated in a case that embroils not only a general allegation of "occasional error" but also a serious accusation of a violation of the Constitution, viz., that doctrines or principles of law were modified or reversed by the Court's Special Third Division August 4, 2009 Resolution.
The law allows a d tennination at first impression that a doctrine or principle laid down hy the court en banc or in division may be modified or reversed in a case which would warrant a referral to the Court En Banc. The use of the word "may" instead of "shall" connotes probability, not certainty, of modification or reversal of a doctrine, as may be deemed by the Court. Ultimately, it is the entire Court which shall decide on the acceptance of the referral and, if so, "to reconcile any seeming conflict, to reverse or modify an earlier decision, and to declare the Court's doctrine."
The Court has the power and prerogative to suspend its own rules and to exempt a case from their operation if and when justice requires it, as in the present circumstance where movant filed a motion for leave after the prompt submission of a second motion for reconsideration but, nonetheless, still within 15 days from receipt of the last assailed resolution.79
[C]oncurring and dissenting opinions serve functions quite consistent with a collegial understanding of the Court. Internally within the Court itself-dissent promotes and improves deliberation and judgment. Arguments on either side of a disagreement test the strength of their rivals and demand attention and response. The opportunity for challenge and response afforded by the publication of dissenting and concurring opinions is a close and sympathetic neighbor of the obligation of reasoned justification.
Externally for lower courts, the parties, and interested bystanders-concurring and dissenting opinions are important guides to the dynamic "meaning" of a decision by the Court. From a collegial perspective, dissenting and concurring opinions offer grounds for understanding how individual Justices, entirely faithful to their Court's product, will interpret that product. The meaning each Justice brings to the product of her Court will inevitably be shaped by elements of value and judgment she brings to the interpretive endeavor; her dissent from the Court's conclusions in the case in question is likely to be dense with insight into these aspects of her judicial persona.84
Article 298. Closure of Establishment and Reduction of Personnel. - The employer may also terminate the employment of any employee due to the installation of labor saving devices, redundancy, retrenchment to prevent losses or the closing or cessation of operation of the establishment or undertaking unless the closing is for the purpose of circumventing the provisions of this Title, by serving a written notice on the workers and the Ministry of Labor and Employment at least one (1) month before the intended date thereof. In case of termination due to the installation of labor saving devices or redundancy, the worker affected thereby shall be entitled to a separation pay equivalent to at least his one (1) month pay or to at least one (1) month pay for every year of service, whichever is higher. In case of retrenchment to prevent losses and in cases of closure or cessation of operations of establishment or undertaking not due to serious business losses or financial reverses, the separation pay shall be equivalent to one (1) month pay or to at least one-half (1/2) month pay for every year of service, whichever is higher. A fraction of at least six (6) months shall be considered one (1) whole year.Accordingly, the employer may resort to retrenchment in order to avert serious business losses. To justify such retrenchment, the following conditions must be present, namely:
1. The retrenchment must be reasonably necessary and likely to prevent business losses;Based on the July 22, 2008 decision, PAL failed to: (1) prove its financial losses because it did not submit its audited financial statements as evidence; (2) observe good faith in implementing the retrenchment program; and (3) apply a fair and reasonable criteria in selecting who would be terminated.
2. The losses, if already incurred, are not merely de minimis, but substantial, serious, actual and real, or, if only expected, are reasonably imminent;
3. The expected or actual losses must be proved by sufficient and convincing evidence;
4. The retrenchment must be in good faith for the advancement of its interest and not to defeat or circumvent the employees' right to security of tenure; and
5. There must be fair and reasonable criteria in ascertaining who would be dismissed and who would be retained among the employees, such as status, efficiency, seniority, physical fitness, age, and financial hardship for certain workers.87
At the outset, it must be pointed out that complainant was never opposed to the retrenchment program itself, as it understands respondent PAL's financial troubles. In fact, complainant religiously cooperated with respondents in their quest for a workable solution to the companythreatening problem. Attached herewith as Annexes "A" to "D" are the minutes of its meetings with respondent PAL's representatives showing complainant's active participation in the deliberations on the issue.These foregoing avennents of FASAP were echoed in its reply90 and memorandum91 submitted to the Labor Arbiter.
What complainant vehemently objects to are the manner and the lack of criteria or standard by which the retrenchment program was implemented or carried out, despite the fact that there are available criteria or standard that respondents could have utilized or relied on in reducing its workforce. In adopting a retrenchment program that was fashioned after the evil prejudices and personal biases of respondent Patria Chiong, respondent PAL grossly violated at least two important provisions of its CBA with complainant - Article VII, Section 23 and Article IX, Sections 31 and 32.89
The audited financial statements should be presented before the Labor Arbiter who is in the position to evaluate evidence. They may not be submitted belatedly with the Court of Appeals, because the admission of evidence is outside the sphere of the appellate court's certiorari jurisdiction. Neither can this Court admit in evidence audited financial statements, or make a ruling on the question of whether the employer incurred substantial losses justifying retrenchment on the basis thereof, as this Court is not a trier of facts. Even so, this Court may not be compelled to accept the contents of said documents blindly and without thinking.Indeed, that a company undergoes rehabilitation sufficiently indicates its fragile financial condition. It is rather unfortunate that when PAL petitioned for rehabilitation the term "corporate rehabilitation" still had no clear definition. Presidential Decree No. 902-A,97 the law then applicable, only set the remedy.98 Section 6(c) and (d) of P.D. No. 902-A gave an insight into the precarious state of a distressed corporation requiring the appointment of a receiver or the creation of a management committee, viz.:
xxxx
In the instant case, PAL failed to substantiate its claim of actual and imminent substantial losses which would justify the retrenchment of more than 1,400 of its cabin crew personnel. Although the Philippine economy was gravely affected by the Asian financial crisis, however, it cannot be assumed that it has likewise brought PAL to the brink of bankruptcy. Likewise, the fact that PAL underwent corporate rehabilitation does not automatically justify the retrenchment of its cabin crew personnel.96 (Emphasis supplied)
xxxxAfter having been placed under corporate rehabilitation and its rehabilitation plan having been approved by the SEC on June 23, 2008, PAL's dire financial predicament could not be doubted. Incidentally, the SEC's order of approval came a week after PAL had sent out notices of termination to the affected employees. It is thus difficult to ignore the fact that PAL had then been experiencing difficulty in meeting its financial obligations long before its rehabilitation.
c) To appoint one or more receivers of the property, real and personal, which is the subject of the action pending before the Commission in accordance with the pertinent provisions of the Rules of Court in such other cases whenever necessary in order to preserve the rights of the parties-litigants and/or protect the interest of the investing public and creditors: Provided, however, That the Commission may, in appropriate cases, appoint a rehabilitation receiver of corporations, partnerships or other associations not supervised or regulated by other government agencies who shall have, in addition to the powers of a regular receiver under the provisions of the Rules of Court, such functions and powers as are provided for in the succeeding paragraph d) hereof: Provided, further, That the Commission may appoint a rehabilitation receiver of corporations, partnerships or other associations supervised or regulated by other government agencies, such as banks and insurance companies, upon request of the government agency concerned: Provided, finally, That upon appointment of a management committee, rehabilitation receiver, board or body, pursuant to this Decree, all actions for claims against corporations, partnerships or associations under management or receivership pending before any court, tribunal, board or body shall be suspended accordingly.
d) To create and appoint a management committee, board, or body upon petition or motu propio to undertake the management of corporations, partnerships or other associations not supervised or regulated by other government agencies in appropriate cases when there is imminent danger of dissipation, loss, wastage or destruction of assets or other properties of paralyzation of business operations of such corporations or entities which may be prejudicial to the interest of minority stockholders, parties-litigants or the general public: Provided, further, That the Commission may create or appoint a management committee, board or body to undertake the management of corporations, partnerships or other associations supervised or regulated by other government agencies, such as banks and insurance companies, upon request of the government agency concerned.
The management committee or rehabilitation receiver, board or body shall have the power to take custody of, and control over, all the existing assets and property of such entities under management; to evaluate the existing assets and liabilities, earnings and operations of such corporations, partnerships or other associations; to determine the best way to salvage and protect the interest of the investors and creditors; to study, review and evaluate the feasibility of continuing operations and restructure and rehabilitate such entities if determined to be feasible by the Commission. It shall report and be responsible to the Commission until dissolved by order of the Commission: Provided, however, That the Commission may; on the basis of the findings and recommendation of the management committee, or rehabilitation receiver, board or body, or on its own findings; determine that the continuance in business of such corporation or entity would not be feasible or profitable nor work to the best interest of the stockholders, parties-litigants, creditors, or the general public, order the dissolution of such corporation entity and its remaining assets liquidated accordingly. The management committee or rehabilitation receiver, board or body may overrule or revoke the actions of the previous management and board of directors of the entity or entities under management notwithstanding any provision of law, articles of incorporation or by-laws to the contrary.
The management committee, or rehabilitation receiver, board or body shall not be subject to any action, claim or demand for, or in connection with, any act done or omitted to be done by it in good faith in the exercise of its functions, or in connection with the exercise of its power herein conferred. (Bold underscoring supplied for emphasis)
That petitioners were not able to present financial statements for years prior to 2005. should not be automatically taken against them. Petitioner BEMI was organized and registered as a corporation in 2004 and started business operations in 2005 only. While financial statements for previous years may be material in establishing the financial trend for an employer, these are not indispensable in all cases of retrenchment. The evidence required for each case of retrenchment will still depend on its particular circumstances. In fact, in Revidad v. National Labor Relations Commission, the Court declared that "proof of actual financial losses incurred by the company is not a condition sine qua non for retrenchment," and retrenchment may be undertaken by the employer to prevent even future losses:In short, to require a distressed corporation placed under rehabilitation or receivership to still submit its audited financial statements may become unnecessary or superfluous.In its ordinary connotation, the phrase "to prevent losses" means that retrenchment or termination of the services of some employees is authorized to be undertaken by the employer sometime before the anticipated losses are actually sustained or realized. It is not, in other words, the intention of the lawmaker to compel the employer to stay his hand and keep all his employees until after losses shall have in fact materialized. If such an intent were expressly written into the law, that law may well be vulnerable to constitutional attack as unduly taking property from one man to be given to anothcr.110 (Bold underscoring supplied for emphasis)
While reinstatement pending appeal aims to avert the continuing threat or danger to the survival or even the life of the dismissed employee and his family, it does not contemplate the period when the employer-corporation itself is similarly in a judicially monitored state of being resuscitated in order to survive.In Philippine Airlines v. Kurangking, Philippine Airlines v. Court of Appeals, Philippine Airlines v. PALEA and Philippine Airlines v. National Labor Relations Commission, the Court uniformly upheld the suspension of monetary claims against PAL because of the SEC's order placing it under receivership. The Court emphasized the need to suspend the payment of the claims pending the rehabilitation proceedings in order to enable the management committee/receiver to channel the efforts towards restructuring and rehabilitation. Philippine Airlines v. Zamora reiterated this rule and deferred to the prior judicial notice taken by the Court in suspending the monetary claims of illegally dismissed employees.112
The parallelism between a judicial order of corporation rehabilitation as a justification for the non-exercise of its options, on the one hand, and a claim of actual and imminent substantial losses as ground for retrenchment, on the other hand, stops at the red line on the financial statements. Beyond the analogous condition of financial gloom, as discussed by Justice Leonardo Quisumbing in his Separate Opinion, are more salient distinctions. Unlike the ground of substantial losses contemplated in a retrenchment case, the state of corporate rehabilitation was judicially pre-determined by a competent court and not formulated for the first time in this case by respondent.
More importantly, there are legal effects arising from a judicial order placing a corporation under rehabilitation. Respondent was, during the period material to the case, effectively deprived of the alternative choices under Article 223 of the Labor Code, not only by virtue of the statutory injunction but also in view of the interim relinquishment of management control to give way to the full exercise of the powers of the rehabilitation receiver. Had there been no need to rehabilitate, respondent may have opted for actual physical reinstatement pending appeal to optimize the utilization of resources. Then again, though the management may think this Wise, the rehabilitation receiver may decide otherwise, not to mention the subsistence of the injunction on claims.111
Sections 5 and 6 of Presidential Decree No. 902-A (P.D. 902-A) ("REORGANIZATION OF THE SECURITIES AND EXCHANGE COMMISSION WITH ADDITIONAL POWERS AND PLACING SAID AGENCY UNDER THE ADMINISTRATIVE SUPERVISION OF THE OFFICE OF THE PRESIDENT"), as amended, read:At any rate, even assuming that serious business losses had not been proved by PAL, it would still be justified under Article 298 of the Labor Code to retrench employees to prevent the occurrence of losses or its closing of the business, provided that the projected losses were not merely de minimis, but substantial, serious, actual, and real, or, if only expected, were reasonably imminent as perceived objectively and in good faith by the employer.116 In the latter case, proof of actual financial losses incurred by the employer would not be a condition sine qua non for retrenchment,117viz.:SEC. 5. In addition to the regulatory and adjudicative functions of THE SECURITIES AND EXCHANGE COMMISSION over corporations, partnerships and other forms of associations registered with it as expressly granted under existing laws and decrees, it shall have original and exclusive jurisdiction to hear and decide cases involving:From the above-quoted provisions of P.D. No. 902-A, as amended, the appointment of a receiver or management committee by the SEC presupposes a finding that, inter alia, a company possesses sufficient property to cover all its debts but "foresees the impossibility of meeting them when they respectively fall due" and "there is imminent danger of dissipation, loss, wastage or destruction of assets of other properties or paralization of business operations."xxx xxx xxx
(d) Petitions of corporations, partnerships or associations declared in the state of suspension of payments in cases where the corporation, partnership or association possesses sufficient property to cover all debts but foresees the impossibility of meeting them when they respectively fall due or in cases where the corporation, partnership, association has no sufficient assets to cover its liabilities, but is under the management of a Rehabilitation Receiver or Management Committee created pursuant to this Decree.
SEC. 6. In order to effectively exercise such jurisdiction, the Commission shall possess the following powers:xxx xxx xxx
(c) To appoint one or more receivers of the property, real and personal, which is the subject of the action pending before the Commission in accordance with the provisions of the Rules of Court in such other cases whenever necessary in order to preserve the rights of the parties-litigants and/or protect the interest of the investing public and creditors: Provided, however, That the Commission may in appropriate cases, appoint a rehabilitation receiver of corporations, partnerships or other associations not supervised or regulated by other government agencies who shall have, in addition to powers of the regular receiver under the provisions of the Rules of Court, such functions and powers as are provided for in the succeeding paragraph (d) hereof: ... (d) To create and appoint a management committee, board or body upon petition or motupropio to undertake the management of corporations, partnership or other associations not supervised or regulated by other government agencies in appropriate cases when there is imminent danger of dissipation, loss, wastage or destruction of assets or other properties or paralization of business operations of such corporations or entities which inay be prejudicial to the interest of minority stockholders, parties-litigants of the general public: ... (Emphasis and underscoring supplied).
That the SEC, mandated by law to have regulatory functions over corporations, partnerships or associations, appointed an interim receiver for the EYCO Group of Companies on its petition in light of, as quoted above, the therein enumerated "factors beyond the control and anticipation of the management" rendering it unable. to meet its obligation as they fall due, and thus resulting to "complications and problems ... to arise that would impair and affect [its] operations ..." shows that CLARION, together with the other member-companies of the EYCO Group of Companies, was suffering business reverses justifying, among other things, the retrenchment of its employees.
This Court in fact takes judicial notice of the Decision of the Court of Appeals dated June 11, 2000 in CA-G.R. SP No. 55208, "Nikon Industrial Corp., Nikolite Industrial Corp., et al. [including CLARION), otherwise known as the EYCO Group of Companies v. Philippine National Bank, Solidbank Corporation, et al., collectively known and referred as the 'Consortium of Creditor Banks,'" which was elevated to this Court via Petition for Certiorari and docketed as G.R. No. 145977, but which petition this Court dismissed by Resolution dated May 3, 2005:Considering the joint manifestation and motion to dismiss of petitioners and respondents dated February 24, 2003, stating that the parties have reached a final and comprehensive settlement of all the claims and counterclaims subject matter of the case and accordingly, agreed to the dismissal of the petition for certiorari, the Court Resolved to DISMISS the petition for certiorari (Underscoring supplied).The parties in G.R. No. 145977 having sought, and this Court having granted, the dismissal of the appeal of the therein petitioners including CLARION, the CA decision which affirmed in toto the September 14, 1999 Order of the SEC, the dispositive portion of which SEC Order reads:WHEREFORE, premises considered, the appeal is as it is hereby, granted and the Order dated 18 December 1998 is set aside. The Petition to be Declared in State of Suspension of payments is hereby disapproved and the SAC Plan terminated. Consequently, all committee, conservator/receivers created pursuant to said Order are dissolved and discharged and all acts and orders issued therein are vacated.has now become final and executory. Ergo, the SEC's disapproval of the EYCO Group of Companies' "Petition for the Declaration of Suspension of Payment ..." and the order for the liquidation and dissolution of these companies including CLARION, must be deemed to have been unassailed.
The Commission, likewise, orders the liquidation and dissolution of the appellee corporations. The case is hereby remanded to the hearing panel below for that purpose.
xxx xxx xxx (Emphasis and underscoring supplied).
That judicial notice can be taken of the above-said case of Nikon Industrial Corp. et al. v. PNB et al., there should be no doubt.
As provided in Section 1, Rule 129 of the Rules of Court:SECTION 1. Judicial notice, when mandatory. - A court shall take judicial notice, without the introduction of evidence, of the existence and territorial extent of states, their political history, forms of government and symbols of nationality, the law of nations, the admiralty and maritime courts of the world and their seals, the political constitution and history of the Philippines, the official acts of the legislative, executive and judicial departments of the Philippines, the laws of nature, the measure of time, and the geographical divisions. (Emphasis and underscoring supplied)which Mr. Justice Edgardo L. Paras interpreted as follows:A court will take judicial notice of its own acts and records in the same case, of facts established in prior proceedings in the same case, of the authenticity of its own records of another case between the same parties, of the files of related cases in the same court, and of public records on file in the same court. In addition judicial notice will be taken of the record, pleadings or judgment of a case in another court between the same parties or involving one of the same parties, as well as of the record of another case between different parties in the same court. Judicial notice will also be taken of court personnel. (Emphasis and underscoring supplied)In fine, CLARION's claim that at the time it terminated Miclat it was experiencing business reverses gains more light from the SEC's disapproval of the EYCO Group of Companies' petition to be declared in state of suspension of payment, filed before Miclat's termination, and of the SEC's consequent order for the group of compani s' dissolution and liquidation.115
Third, contrary to petitioner's asseverations, proof of actual financial losses incurred by the company is not a condition sine qua non for retrenchment. Retrenchment is one of the economic grounds to dismiss employees, which is resorted to by an employer primarily to avoid or minimize business losses. The law recognize this under Article 283 of the Labor Code xxx
xxxx
In its ordinary connotation, the phrase "to prevent losses" means that retrenchment or termination of the services of some employees is authorized to be undertaken by the employer sometime before the anticipated losses are, actually sustained or realized. It is not, in other words, the intention of the lawmaker to compel the employer to stay his hand and keep all his employees until after losses shall have in fact materialized. If such an intent were expressly written into the law, that law may well be vulnerable to constitutional attack as unduly taking property from one man to be given to another.
At the other end of the spectrum, it seems equally clear that not every asserted possibility of loss is sufficient legal warrant for the reduction of personnel. In the nature of things, the possibility of incurring the losses is constantly present, in greater or lesser degree, in the carrying on of business operations, since some, indeed many, of the factors which impact upon the profitability or viability of such operations may be substantially outside the control of the employer.
On the bases of these consideration, it follows that the employer bears the burden to prove his allegation of economic or business reverses with clear and satisfactory evidence, it being in the nature of an affirmative defense. As earlier discussed, we are fully persuaded that the private respondent has been and is besieged by a continuing downtrend in both its business operations and financial resources, thus amply justifying its resort to drastic cuts in personnel and costs.118
Roberto D. AnduizaThe records also show that the parties met on several occasions124 to explore cost-cutting measures, including the implementation of the retrenchment program. PAL likewise manifested that the retrenchment plan was temporarily shelved while it implemented other measures (like termination of probationary cabin attendant, and work-rotations).125 Obviously, the dissent missed this part as it stuck to the belief that PAL did not implement other cost-cutting measures prior to retrenchment.126
President
Flight Attendants' and Stewards' Association of the Philippines (FASAP)
xxxx
Mr. Anduiza:
Due to critical business losses and in view of severe financial reverses, Philippine Airlines must undertake drastic measures to strive at survival. In order to meet maturing obligations amidst the present regional crisis, the Company will implement major cost-cutting measures in its fleet plan, operating budget, routes and frequencies. These moves include the closure of stations, downsizing of operations and reducing the workforce through layoff/retrenchment or retirement.
In this connection, the Company would like to meet with the Flight Attendants' and Stewards' Association of the Philippines (FASAP) to discuss the implementation of the lay-off/retrenchment or retirement of FASAP-covered employees. The meeting shall be at the Allied Bank Center (8th Floor-Board Room) on February 12, 1998 at 4:00 p.m.
This letter serves as notice in compliance with Article 283 of the Labor Code, as amended and DOLE Orders Nos[.] 9 and 10, Series of 1997.
Very truly yours,
(Sgd.)
JOSE ANTONIO GARCIA
President & Chief Operating Officer123
xxx The Rehabilitation Plan and Amended Rehabilitation Plan submitted by PAL in pursuance of its corporate rehabilitation, and which obtained the joint approval of PAL's creditors and the SEC, had as a primary component, the downsizing of PAL's labor force by at least 5,000, including the 1,400 flight attendants. As conceptualized by a team of industry experts, the cutting down of operations and the consequent reduction of work force, along with the restructuring of debts with significant "haircuts" and the capital infusion of Mr. Lucio Tan amounting to US$200 million, were the key components of PAL's rehabilitation. The Interim Rehabilitation Receiver was replaced by a Permanent Rehabilitation Receiver on June 7, 1999.131 (Bold underscoring supplies tor emphasis)Being under a rehabilitation program, PAL had no choice but to implement the measures contained in the program, including that of reducing its manpower. Far from being an impulsive decision to defeat its employees' right to security of tenure, retrenchment resulted from a meticulous plan primarily aimed to resuscitate PAL's operations.
June 15, 1998As regards the observation made in the decision of July 22, 2008 to the effect that the recall of the flight crew members indicated bad faith, we hold to the contrary.
HON. MAXIMO B. LIM
THE REGIONAL DIRECTOR
Department of Labor and Employment
Regional Office No. NCR
Dear Sir:
This is to inform you that Philippine Air Lines, Inc. (PAL) will be implementing a retrenchment program one (1) month from notice hereof in order to prevent bankruptcy.
PAL is forced to take this action because of continuous losses it has suffered over the years which losses were aggravated by the PALEA strike in October 1996, peso depreciation, Asian currency crisis, causing a serious drop in our yield and the collapse of passenger traffic in the region. Specifically, PAL suffered a net loss of P2.18 Billion during the fiscal year 1995-1996, P2.50 Billion during the fiscal year 1996-1997 and P8.08 Billion for the period starting April 1, 1997 to March 31, 1998.
These uncontrolled heavy losses have left PAL with no recourse but to reduce its fleet and its flight frequencies both in the domestic and international sectors to ensure its survival.
In an effort to avoid a reduction of personnel, PAL has resorted to other measures, such as freeze on all hiring, no salary increase for managerial and confidential staff (even for promotions), reduction of salaries of senior management personnel, freeze on staff movements, pre-termination of temporary staff contracts and negotiations with foreign investors. But all these measures failed to avert the continued losses.
Finally, all the efforts of PAL to preserve the employment of its personnel were shattered by the illegal strike of its pilots which has cause irreparable damage to the company's cash flow. Consequently, the company is now no longer able to meet its maturing obligations and is not about to go into default in all its major loans. It is presently under threat of receiving a barrage of suits from its creditors who will go after the assets of the corporation.
Under the circumstances, PAL is left with no recourse but to reduce its fleet and its flight frequencies both in the domestic and international sectors to ensure its survival. Consequently, a reduction of personnel is inevitable.
All affected employees in the attached list will be gtven the corresponding benefits which they may be entitled to.Very truly yours,
(Sgd)
JOSE ANTONIO GARCIA
President & Chief Operating Officer132
During this time, the Company was slowly but steadily recovering. Its finances were improving and additional planes were flying. Because of the Company's steady recovery, necessity dictated more employees to man and service the additional planes and flights. Thus, instead of taking in new hires, the Company first offered employment to employees who were previously retrenched. A recall/rehire plan was initiated.Contrary to the statement in the dissent that the implementation of Plan 22 instead of Plan 14 indicated bad faith,134 PAL reasonably demonstrated that the recall was devoid of bad faith or of an attempt on its part to circumvent its affected employees' right to security of tenure. Far from being tainted with bad faith, the recall signified PAL's reluctance to part with the retrenched employees. Indeed, the prevailing unfavorable conditions had only compelled it to implement the retrenchment.
The recall/rehire plan was a success. A majority of retrenched employees were recalled/rehired and went back to work including the members of petitioner union. In the process of recall/rehire, many employees who could not be recalled for various reasons (such as, among others, being unfit for the job or the employee simply did not want to work for the Company anymore) decided to accept separation benefits and executed, willingly and voluntarily, valid quitclaims. Those who received separation packafes included a good number of the members of the petitioner union.133
We likewise cannot sustain petitioners' argument that their dismissal was illegal on the basis that Lapanday did not actually cease its operation, or that they have rehired some of the dismissed employees and even hired new set of employees to replace the retrenched employees.Conselquently, we cannot pass judgment on the motive behind PAL's initiative to implement "Plan 22" instead of "Plan 14." The prerogative thereon belonged to the management alone due to its being in the best position to assess its own financial situation and operate its own business. Even the Court has no power to interfere with such exercise of the prerogative.
The law acknowledges the right of every business entity to reduce its workforce if such measure is made necessary or compelled by economic factors that would otherwise endanger its stability or existence. In exercising its right to retrench employees, the firm may choose to close all, or a part of, its business to avoid further losses or mitigate expenses. In Caffco International Limited v. Office of the Minister-Ministry of Labor and Employment, the Court has aptly observed that -Business enterprises today are faced with the pressures of economic recession, stiff competition, and labor unrest. Thus, businessmen are always pressured to adopt certain changes and programs in order to enhance their profits and protect their investments. Such changes may take various forms. Management may even choose to close a branch, a department, a plant, or a shop.In the same manner, when Lapanday continued its business operation and eventually hired some of its retrenched employees and new employees, it was merely exercising its right to continue its business. The fact that Lapanday chose to continue its business does not automatically make the retrenchment illegal. We reiterate that in retrenchment, the goal is to prevent impending losses or further business reversals - it therefore does not require that there is an actual closure of the business. Thus, when the employer satisfactorily proved economic or business losses with sufficient supporting evidence and have complied with the requirements mandated under the law to justify retrenchment, as in this case, it cannot be said that the subsequent acts of the employer to rehire the retrenched employees or to hire new employees constitute bad faith. It could have been different if from the beginning the retrenchment was illegal and the employer subsequently hired new employees or rehired some of the previously dismissed employees because that would have constituted bad faith. Consequently, when Lapanday continued its operation, it was merely exercising its prerogative to streamline its operations, and to rehire or hire only those who are qualified to replace the services rendered by the retrenched employees in order to effect more economic and efficient methods of production and to forestall business losses. The rehiring or reemployment of retrenched employees does not necessarily negate the presence or imminence of losses which prompted Lapanday to retrench.
In spite of overwhelming support granted by the social justice provisions of our Constitution in t wor of labor, the fundamental law itself guarantees, even during the process of tilting the scales of social justice towards workers and employees, "the right of enterprises to reasonable returns of investment and to expansion and growth." To hold otherwise would not only be oppressive and inhuman, but also counter-productive and ultimately subversive of the nation's thrust towards a resurgence in our economy which would ultimately benefit the majority of our people. Where appropriate and where conditions are in accord with law and jurisprudence, the Court has authorized valid reductions in the workforce to forestall business losses, the hemorrhaging of capital, or even to recognize an obvious reduction in the volume of business which has rendered certain employees redundant.135
FASAP insists that several CBA provisions have been violated by the retrenchment. They are the provisions on seniority, performance appraisal, reduction in personnel and downgrading and permanent OCARs. Seniority and performance stand out because these were the main considerations of PAL in selecting workers to be retrenched. Under the CBA, seniority is defined "to mean a measure of a regular Cabin Attendant's claim in relation to other regular Cabin Attendants holding similar positions, to preferential consideration whatever the Company exercises its right to promote to a higher paying position of lay-off of any Cabin Attendant." Seniority, however, is not the sole determinant of retention. This is clear under Article XIII on performance appraisal of the CBA provisions.To require PAL to further limit its criteria would be inconsistent with jurisprudence and the principle of fairness. Instead, we hold that for as long as PAL followed a rational criteria defined or set by the CBA and existing laws and jurisprudence in determining who should be included in the retrenchment program, it sufficiently met the standards of fairness and reason in its implementation of its retrenchment program.
Under the CBA, several factors are likewise taken into consideration like performance and professionalism in addition to the seniority factor. However, the criteria for performance and professionalism are not indicated in the CBA but are to be formulated by PAL in consultation with FASAP. Where there is retrenchment, cabin attendants who fail to attain at least 85% of the established criteria shall be demoted progressively. Domestic cabin attendants, the occupants of lowest rung of the organizational hierarchy, are to be retrenched once they fail to meet the required percentage.
We have painstakingly examined the records and We find no indication that these provisions have been grossly disregarded as to taint the retrenchment with illegality. PAL relied on specific categories of criteria, such as merit awards, physical appearance, attendance and checkrides, to guide its selection of employees to be removed. We do not find anything legally objectionable in the adoption of the foregoing norms. On the contrary, these norms are most relevant to the nature oflcabin attendant's work.
However, the contention of FASAP that these criteria required its prior conformity before adoption is not supported by Section 30, Article VIII of the CBA. Note should be taken that this provision only mandates PAL to "meet and consult" the Association (FASAP) in the formulation of the Performance and Professionalism Appraisal System. By the ordinary import of this provision, PAL is only required to confer with FASAP; it is not at all required to forge an addendum to the CBA, which will concretize the appraisal system as basis for retrenchment or retention.155
In order to prevent disputes on the validity and enforceability of quitclaims and waivers of employees under Philippine laws, said agreements should contain the following:The release and quitclaim signed by the affected employees substantially satisfied the aforestated requirements. The consideration was clearly indicated in the document in the English language, including the benefits that the employees would be relinquishing in exchange for the amounts to be received. There is no question that the employees who had occupied the position of flight crew knew and understood the English language. Hence, they fully comprehended the terms used in the release and quitclaim that they signed.1. A fixed amount as full and final compromise settlement;
2. The benefits of the employees if possible with the corresponding amounts, which the employees are giving up in consideration of the fixed compromise amount;
3. A statement that the employer has dearly explained to the employee in English, Filipino, or in the dialect known to the employees - that by signing the waiver or quitclaim, they are forfeiting or relinquishing their right to receive the benefits which are due them under the law; and
4. A statement that the employees signed and executed the document voluntarily, and had fully understood the contents of the document and that their consent was freely given without any threat, violence, duress, intimidation, or undue influence exerted on their person.157 (Bold supplied for emphasis)
| Very truly yours, |
(SGD) | |
EDGAR O. ARICHETA | |
Clerk of Court |
Endnotes:
* On indefinite leave effective March 1, 2018.
1Rollo (G.R. No. 178083), Vol. III, pp. 2239-2294.
2Rollo (A.M. No. 11-10-1-SC), pp. 165-173.
3 Then composed of Associate Justice Consuelo Ynares-Santiago (ponente), Associate Justice Ma. Alicia Austria-Martinez, Associate Justice Minita V. Chico-Nazario, Associate Justice Antonio Eduardo B. Nachura, and Associate Justice Teresita J. Leonardo-De Castro (designated in lieu of Associate Justice Ruben T. Reyes).
4Rollo (A.M. No. 11-10-1-SC), pp. 1517-1547.
5Rollo(G.R. No. 178083), Vol. II, pp. 1546-1547.
6Rollo (G.R. No. 178083), Vol. I, pp. 59-83; penned by Associate Justice Ruben T. Reyes and concurred in by Associate Justice Juan Q. Enriquez, Jr. and Associate Justice Vicente S.E. Veloso.
7Rollo (G.R. No. 178083), Vol. I, p. 73.
8Rollo (G.R. No. 178083), Vol. II, pp. 1549-1585.
9Rollo (G.R. No. 178083), Vol. III, pp. 1805-1806.
10Rollo (G.R. No. 178083), Vol. III, pp. 1816-1817.
11 Then composed of Justice Consuelo Ynares-Santiago (ponente), Justice Minita V. Chico-Nazario, Justice Eduardo B. Nachura, Justice Diosdado M. Peralta (replacing Justice Alicia Austria-Martinez who retired on April 30, 2009), and Justice Lucas P. Bersamin (in lieu of Justice Teresita J. Leonardo-de Castro who inhibited from the case due to personal reasons).
12 See Flight Attendants and Stewards Association of the Philippines (FASAP) v. Philippine Airlines, Inc., G.R. No. 178083, October 2, 2009, 602 SCRA 473.
13 Id. at 506-507.
14 Supra note 1.
15Amended Rules on Who Shall Resolve Motions for Reconsideration of Decisions or Signed Resolutions in Cases Assigned to the Division of the Court (November 17, 2009).
16 Then composed of Justice Antonio T. Carpio (in lieu of then Chief Justice Renato Corona who inhibited from the case), Justice Velasco, Jr., Justice Nachura, Justice Peralta, and Justice Bersamin. See In Re: Letters of Atty. Estelito P. Mendoza Re: G.R. No. 178083-Flight Attendants and Stewards Association of the Philippines v. Philippine Airlines, Inc. (PAL), A.M. No. 11-10-1-SC March 13, 2012, 668 SCRA 11, 27.
17 Special Order No. 839 dated May 17, 2010.
18In Re: Letters of Atty. Estelito P. Mendoza, supra, note 16, at 32.
19 Special Order No. 1025 dated June 21, 2011.
20 Comprised of Justice Brion (ponente), with Justice Peralta (in lieu of Justice Carpio who also inhibited from the case), Justice Bersamin (temporarily replacing Justice Maria Lourdes P.A. Sereno who was on leave), Justice Jose Perez (now retired), and Justice Jose C. Mendoza (temporarily replacing Justice Bienvenido Reyes who was on leave).
21 Dated September 13, 16, 20, and 22, 2011.
22Rollo (G.R. No. 178083), Vol. IV, p. 3568.
23In Re: Letters of Atty. Estelito P. Mendoza, supra, note 16.
24 Id. at 46-47.
25In Re: Letters of Atty. Estelito P. Mendoza, supra, note 16, at 47-48.
26 Supra note 2.
27Rollo (A.M. No. 11-10-1-SC), p. 157.
28Rollo (G.R. No. 178083). Vol. III, p. 2299.
29Rollo (G.R. No. 178083), Vol. II, p. 1551.
30 Id. at 1551-1554.
31 Id. at 1555.
32 Id. at 1556-1557.
33 Id. at 1564-1567 (PAL claims that the Court had suspended the claims in view of the pending rehabilitation in Philippine Airlines v. Kurangking, G.R. No. 146698, September 24, 2002, 389 SCRA 588; Philippine Airlines v. Zamora, G.R. No. 166966, February 6, 2007, 514 SCRA 584; Garcia v. Philippine Airlines, Inc., G.R. No. 164856, August 29, 2007, G.R. No. 164856, 531 SCRA 574; Philippine Airlines v. Philippine Airlines Employee Association (PALEA), G.R. No. 142399, June 19, 2007, 526 SCRA 29; Philippine Airlines v. National Labor Relations Commission, G.R. No. 123294, September 4, 2000, 634 SCRA 18.
34 Id. at 1567-1568.
35 Id. at 1569-1576.
36 Id. at 1577-1582.
37Rollo (G.R. No. 178083), Vol. III, pp. 2250-2251.
38 Id. at 2251-2252.
39Rollo (G.R. No. 178083), Vol. III, pp. 2276-2277.
40 G.R. No. 164856, August 29, 2007, 531 SCRA 574.
41E.g., Philippine Airlines v. Kurangking, G.R. No. 146698, September 24, 2002, 389 SCRA 588; Philippine Airlines, Incorporated v. Zamora, G.R. No. 166966, February 6, 2007, 514 SCRA 584; Philippine Airlines, Incorporated v. Philippine Airlines Employees Association (PALEA), G.R. No. 142399, June 19, 2007, 525 SCRA 29; and Philippine Airlines v. National Labor Relations Commission, G.R. No. 123294, September 4, 2000, 634 SCRA 18.
42Rollo (G.R. No. 178083), Vol. III, pp. 2444-2496.
43Rollo (A.M. No. 11-10-1-SC), pp. 165-173.
44 668 SCRA 11, 43-44.
45 Id. at 50.
46Rollo (A.M. No. 11-10-1-SC), p. 169.
47 Id. at 169-170.
48 Id. at 85.
49 See Republic v. Mercadera, G.R. No. 186027, December 8, 2010, 637 SCRA 654.
50Regional Agrarian Reform Acijudication Board v. Court of Appeals, G.R. No. 165155, April 13, 2010, 618 SCRA 181, 202-203.
51Gaw v. Chua, G.R. No. 160855, April 16, 2008, 551 SCRA 506, 516.
52Remonte v. Bonto, No. L-19900, February 28, 1966, 16 SCRA 257, 261.
53 668 SCRA 11, 48-49.
54 A.M. No. 03-11-30-SC, June 9, 2005, 460 SCRA 1.
55 Id. at 15-16.
56Rollo (G.R. No. 178083), Vol. III, pp. 2435-2436.
57League of Cities of the Philippines (LCP) v. Commission on Elections, G.R. No. 176951, February 15, 2011, 643 SCRA 149.
58McBurnie v. Ganzon, G.R. Nos. 178034 & 178117 & G.R. Nos. 186984-85, October 17, 2013, 707 SCRA 646, 668-669.
59 Sec. 2. Second motion for reconsideration. - No second motion for reconsideration of a judgment or final resolution by the same party shall be entertained.
60SM Land, Inc. v. Bases Conversion and Development Authority, G.R. No. 203655, September 7, 2015, 769 SCRA 310, 317.
61 Section 3, Rule 15 of the IRSC.
62 Supra note 41.
63Rollo (G.R. No. 178083), Vol. III, pp. 2239-2240.
64 Id. at 2242-2244.
65 Id. at 2244-2245.
66 Dissenting Opinion, p. 21.
67 Id. at 7.
68Belviz v. Buenaventura, 83 Phil. 337-340 (1949). In Guilambo v. Court of Appeals, 65 Phil. 183-189 1937), the Court explained: "Within what time should a second motion for reconsideration or a second motion for new trial, be filed? Nothing is provided in our rules; but considering, on the one hand, that, under the provisions of Rule 37, judgment should be entered fifteen days after the promulgation of the decision of the court, and, on the other hand, that the previous leave of court is necessary to file a second motion for reconsideration or a second motion for new trial, it is inferable from all this that the second motion should be filed within the time granted by the court, and as the rules are likewise silent on the period within which application for leave of court to file a second motion for new trial or a second motion for reconsideration should be made, a reasonable and logical interpretation of Rule 39 seems to authorize the opinion that the said leave should be applied for immediately after receipt of notice denying the first motion, or as soon as possible."
69Ortigas & Company Limited Partnership v. Velasco, G.R. No. 109645, 112564 (Resolution), March 4, 1996, 324 PHIL 483-498
70 Dissenting Opinion, p. 1.
71 Id. at 17.
72 Id. at 8.
73 352 Phil. 461 (1998).
74 Dissenting Opinion, p. 12.
75 Id. at 17-18.
76In Re: Letters of Atty. Estelito P. Mendoza, supra, note 16, at 38-44.
77 Dissenting Opinion, p. 18.
78 G.R. No. 153690, February 15, 2011, 643 SCRA 23.
79 Id. at 40-42; emphasis and underscoring are part of the original text.
80 To correct the statement in the Dissenting Opinion (p. 19) that the motion was PAL's "third motion for reconsideration."
81 Dissenting Opinion, p. 19.
82Consing v. Court of Appeals, G.R. No. 78272, 29 August 1989, 177 SCRA 14, 21.
83 Kornhauser and Sager, The One and the Many: Adjudication in Collegial Courts, 81 Cal. L. Rev. 1, p. 7 (1993). Available at: http://scholarship.law.berkeley.edu/californialawreview/vol81/iss1/1 (last accessed January 14, 2018).
84 Id. at 9.
85Pepsi-Cola Products Philippines, Inc. v. Molon, G.R. No. 175002, February 18, 2013, 691 SCRA 113, 126; Philippine Carpet Employees Association (PHILCEA) v. Sto. Tomas, G.R. No. 168719, February 22, 2006, 483 SCRA 128, 143.
86 Formerly Article 283; See DOLE Department Advisory No. 01 series of 2015.
87 DOLE Department Order No. 147-15, series of 2015 (Amending the Implementing Rules and Regulations of Book VI of the Labor Code of the Philippines, As Amended)
88Rollo (G.R. No. 178083), Vol. I, p. 491.
89 Id. at 113-114.
90 Id. at 164-165.
Paragraphs 3 and 4 of the Reply reads:
3. It must be stressed that complainant was never opposed to respondents['] retrenchment program as it truly understands respondent PAL's financial position. As a matter of fact, when it became apparent that the company was already in the brink of bankruptcy, complainant actively participated in fashioning out some workable solutions to the problem. Respondents have personal knowledge of such fact;
4. What complainant vigorously objects to was the capricious and whimsical implementation of the retrenchment program which, as circumstances would prove, intended not only to save respondent PAL from business and financial collapse but also to get rid of employees who were actively engaging in union activities and also those who are relatively of age already. In other words, such retrenchment program was taken advantage of to cleanse complainant's ranks of vigilant and active union members as well as older and senior cabin attendants.
91 Id. at 175-176.
FASAP averred:
This is a case of unfair labor practice, plain and simple. Respondents, finding an opportunity in its financial predicament due to the Asian economic crisis that gravely affected most industries in the far east, and specifically Respondents herein, retrenched around Five Thousand employees, including One Thousand Four Hundred flight attendants and stewards as well as pursers. While Complainant does not question the financial setback of respondent airline due to the Asian economic crisis, it doubts the manner and sincerity by which respondents effected the termination. It challenges respondents to show in this suit that they followed a set of rules and norms in coming up with the list of employees to be retrenched, more specifically those members and officers of Complainant union.
92 Sec. 4, Rule 129 of the Rules of Court.
93Josefa v. Manila Electric Company, G.R. No. 182705, July 18, 2014, 730 SCRA 126, 144; Philippine Long Distance Telephone Company (PLDT) v. Pingol, G.R. No. 182622, September 8, 2010, 630 SCRA 413, 421.
94 Namely: Central Azucarera de La Carlota v. National Labor Relations Commission, Polymart Paper Industries, Inc. v. National Labor Relations Commission. F.F. Marine Corp. v. National Labor Relations Commission, Philippine Airlines, Inc. v. Dawal, LVN Pictures Employees and Workers Association (NLU) v. LVN Pictures, Inc., North Davao Mining Corporation v. NLRC, and Manatad v. Philippine Telegraph and Telephone Corporation (Dissenting Opinion, pp. 23-24)
95Central Azucarera de la Carlota originated from a complaint for reinstatement, alleging that the implemented retrenchment program was not based on valid grounds. In Polymart, the employees alleged that their employer resorted to illegal dismissal on the pretext of incurring serious business losses and the officers and members of the labor union were the first to be retrenched because of their previous misdemeanors. F.F. Marine Corp. arose from a complaint for illegal dismissal, with the employee alleging that he was beguiled to accept the separation pay on the pretext that the machine he was working on was transferred to the province. The employer how ver countered that the employee was validly retrenched. In PAL v. Dawal, the complaint before the Labor Arbiter was that of illegal dismissal and unfair labor practice, with PAL claiming that the termination was a valid retrenchment due to the Asian Financial Crisis.
96Flight Attendants and Stewards Association of the Philippines v. Philippine Airlines, Inc., G.R. No. 178083, July 22, 2008, 559 SCRA 252, 278-279.
97Reorganization of the Securities and Exchange Commission with Additional Power and Placing Said Agency under the Administrative Supervision of the Office of the President, as amended by P.D. No. 1799.
98 Concepcion, Corporate Rehabilitation: The Philippine Experience. Economic Policy Agenda Series No. 9. Foundation for Economic Freedom, Inc., p. 3, available at http://dirp3.pids.gov.ph/ris/taps/tapspp9916.pdflast accessed on April 8, 2017.
99 International Air Transport Association (IATA). Airline Disclosure Guide: Aircraft Acquisition Cost and Depreciation available at https://www.iata.org/publications/Documents/Airline-Disclosure-Guideaircraft-acquisition.pdflast accessed on April 8, 2017.
100 These included Cathay Pacific, Garuda Airlines, Japan Airlines and Malaysian Airlines, all of which reviewed their operating costs and implemented cost cutting measures including employment lay-off. See World Tourism Organization. Impacts of the Financial Crisis on Asia's Tourism Sector, p. 22 available at http://sete.gr/files/Media/Ebook/110301_Impacts%20of%20the%20Financial%20Crisis%20on%20Asia%20Tourism%20Sector.pdflast accessed on April 8, 2017.
101 In Re. Request Radio-TV Coverage of the Trial in the Sandiganbayan of the Plunder Cases Against the Former President Joseph E. Estrada, Secretary of Justice Hernando Perez, Kapisanan ng mga Brodkaster ng Pilipinas, Cesar Sarino, Renato Cayetano and Atty. Ricardo Romulo v. Estrada, A.M. No. 01-4-03-SC, June 29, 2001, 360 SCRA 248, the Court took judicial notice of the effect of the media in stirring public sentiments during an impeachment trial.
102 In Marcos v. Manglapus, G.R. No. 88211, September 15, 1989, 177 SCRA 668, the Court took judicial notice of the resulting precarious state of the economy in connection with the return of former President Ferdinand E. Marcos to the country; In Candelaria v. People, G.R. No. 209386, December 8, 2014, 744 SCRA 178, the Court also took judicial notice of the value of diesel fuel as a matter of public knowledge.
103 Section 2, Rule 129 of the Rules of Court.
104Republic v. Sandiganbayan (Fourth Division), G.R. No. 152375, December 13, 2011, 662 SCRA 152, 212; Habagat Grill v. DMC-Urban Property Developer, Inc., G.R. No. 155110, March 31, 2005, 454 SCRA 653, 668, 669.
105Rollo (G.R. No. 178083), Vol. I, pp. 491-492.
The Labor Arbiter stated in its decision:
"[I]t is not disputed that PAL suffered business reverses which almost brought it to total bankruptcy. PAL's precarious financial position immediately before it embarked on the controversial retrenchment program was not only directly attribute[d] to the crisis that plague the Asian economies which started in the middle of 1997 that continuous to be felt until today, but also partly due to the strike staged by the Airline Pilots Association of the Philippines (ALPAP) and by the Philippine Airlines Employees (PALEA), which crippled its operation for a considerable period of time.
The combination of the economic predicament in the Asian region and the crippling strike proved too much for PAL. Its assets almost levelled with its liabilities. Under tremendous pressure, PAL was placed under Rehabilitation Receiver and its Rehabilitation Plan was approved, as evidenced by the Order of the Securities and Exchange Commission, dated 23 June 1998 in SEC Case No. 06-98-6004 entitled: [I]n the Matter of the Petition for the Approval of Rehabilitation Plan and for Appointment of a Rehabilitation Receiver. There is, therefore, no doubt with respeet to respondent's financial distress."
106 Id. at 673; the NLRC also noted that the complainants did not dispute the financial reverses suffered by PAL (Rollo (Id. at 685).
107 Id. at 60.
108 See Rivera v. Espiritu, G.R. No. 135547, January 23, 2002, 374 SCRA 351.
109 Antes, Brightening Philippine Airlines (PAL): Strategizing for the Future of Asia's Pioneer and Sunniest Air Transporter. Case Studies in Asian Management, Haghirian, P. (Ed.), World Scientific Publishing Co, Pte. Ltd. (2014), p. 189.
110Blue Eagle Management. Inc. v. Bonoan, G.R. No. 192488, April 19, 2016, 790 SCRA 328, 355.
111 G.R. No. 164856, January 20, 2009, 576 SCRA 479, 496-497.
112 In an earlier resolution in Philippine Airlines v. Zamora, G.R. No. 166996, February 6, 2007, 514 SCRA 584.
113 Sec. 1, Rule 129 of the Rules of Court.
114 G.R. No. 148372, June 27, 2005, 461 SCRA 272.
115 Id. at 290-294.
116Beralde v. Lapanday Agricultural and Development Corporation (Guihing Plantation Operations), G.R. Nos. 205685-86, June 22, 2015, 760 SCRA 158, 175-176.
117Revidad v. National Labor Relations Commission, G.R. No. 111105, June 27, 1995, 245 SCRA 356.
118 Id. at 367-368.
119Pasig Agricultural Deveiopmem and Industrial Supply Corporation v. Nievarez, G.R. No. 197852, October 19, 2015, 773 SCRA 52, 64.
120Rollo (G.R. No. 178083), Vol. III, pp. 2261-2264.
121 Id. at 2266-2267, PAL reasoned that the primary component of the Rehabilitation Plan and Amended Rehabilitation Plan approved by the PAL creditors and the SEC, was the downsizing of the labor force by at least 5,000, which included the 1,400 flight attendants. The cutting-down of operations and consequent reduction of labor force together with the debt restructuring and capital infusion of US$200 million, were the key components in the rehabilitation.
122 Id. at 2268.
123Rollo (G.R. No. 178083), Vol. II, p. 1419.
124Rollo (G.R. No. 178083), Vol. I, pp. 127-132; the meetings were held on February 17, February 20, March 6, March 10, and March 17, 1998.
125Rollo (G.R. No. 178083), Vol. III, p. 2274.
126 Dissenting Opinion, pp. 25-26.
127Rollo (G.R. No. 178083), Vol. III, pp. 2252-2253; PAL manifested that the strike had crippld almost 90% of its operations wherein the striking pilots abandoned the planes wherever they were; that with only 60 pilots and Jesser planes in operation, PAL's daily revenue losses reached P100 million while its fixed cost required P50 million daily to operate; that given the situation, it only had approximately eighteen (18) days to operate since it had no access to any tunher credit or other liquidity facilities.
128 G.R. No. 135547, January 23, 2002, 374 SCRA 351, 355.
129 The last paragraph of Section 3, Article XIII states: "The State shall regulate the relations between workers and employers, recognizing the right or labor to its just share in the fruits of production and the right of enterprises to reasonable returns to investments, and to expansion and growth."
130Rollo (G.R. No. 178083), Vol. III, pp. 2255-2257.
131 Id. at 2267.
132Rollo (G.R. No. 178083), Vol. II, p. 1421 (bold underscoring supplied for emphasis).
133 Id. at 1395.
134 Dissenting Opinion, pp. 27-28.
135Beralde v. Lapanday Agricultural and Development Corporation (Guihing Plantation Operations), supra, note 116, at 177-178.
136 559 SCRA, 252, 291-292.
137Rollo (G.R. No. 178083), Vol. III, pp. 2401-2405.
138 Id. at 2407.
139 Id. at 2408-2409.
140 Id. at 2412.
141Caltex (Phils.), Inc. v. National Labor Relations Commission, G.R. No. 159641, October 15, 2007, 536 SCRA 175, 188.
142Talam v. National Labor Relations Commission, G.R. No. 175040, April 6, 2010, 617 SCRA 408, 422.
143Saballa v. National Labor Relations Commission, G.R. Nos. 102472-84, August 22, 1996, 260 SCRA 697, 711.
144Bogo-Medellin Sugarcane Planters Association, Inc. v. NLRC, G.R. No. 97846, September 25, 1998, 296 SCRA 108, 123.
145Manila Hotel Corporation v. NLRC, G.R. No. L-53453, January 22, 1986, 141 SCRA 169, 177.
146Philippine Tuberculosis Society, Inc. v. National Labor Union, G.R. No. 115414, August 25, 1998, 294 SCRA 567, 576, 578.
147Oriental Petroleum and Minerals Corporation v. Fuentes, G.R. No. 151818, October 14, 2005, 473 SCRA 106, 118.
148Caltex (Phils.), Inc. v. National Labor Relations Commission, G.R. No. 159641, October 15, 2007, 536 SCRA 175, 190.
149Shimizu Phils. Contractors, Inc. v. Callanta, (G.R. No. 165923, September 29, 2010, 631 SCRA 529, 542.
150Morales v. Metropolitan Bank and Trust Company, G.R. No. 182475, November 21, 2012, 686 SCRA 132, 146.
151Talam v. National Labor Relations Commission, supra, note 142.
152Coats Manila Bay, Inc. v. Ortega, G.R. No. 172628, February 13, 2009, 579 SCRA 300, 309.
153Pepsi-Cola Products Philippines. Inc. v. Molon, G.R. No. 175002, Febmary 18, 2013, 691 SCRA 113, 134.
154 Dissenting Opinion, p. 41.
155Rollo (G.R. No. 178083), Vol. I, pp. 78-79 (bold underscoring supplied for emphasis).
156 G.R. No. 145587, October 26, 2007, 537 SCRA 409.
157 Id. at 442.
158Sara Lee Philippines v. Macatlang, G.R. No. 180147, January 14, 2015 (Resolution); Radio Mindanao Network, Inc. v. Amurao III, G.R. No. 167225, October 22, 2014, 739 SCRA 64, 72.
LEONEN, J.:
WHEREFORE, the instant petition is GRANTED. The assailed Decision of the Court of Appeals in CA-G.R. SP No. 87956 dated August 23, 2006, which affirmed the Decision of the NLRC setting aside the Labor Arbiter's findings of illegal retrenchment and its Resolution of May 29, 2007 denying the motion for reconsideration, are REVERSED and SET ASIDE and a new one is rendered:The Decision, penned by Justice Consuelo Ynares-Santiago, was concurred in by all the Members of the Third Division: Justices Ma. Alicia Austria-Martinez, Minita Chico-Nazario, Antonio Eduardo Nachura, and Teresita Leonardo-De Castro.SO ORDERED.5
- FINDING respondent Philippine Airlines, Inc. GUILTY of illegal dismissal;
- ORDERING Philippine Airlines, Inc. to reinstate the cabin crew personnel who were covered by the retrenchment and demotion scheme of June 15, 1998 made effective on July 15, 1998, without loss of seniority rights and other privileges, and to pay them full backwages, inclusive of allowances and other monetary benefits computed from the time of their separation up to the time of their actual reinstatement, provided that with respect to those who had received their respective separation pay, the amounts of payments shall be deducted from their backwages. Where reinstatement is no longer feasible because the positions previously held no longer exist, respondent Corporation shall pay backwages plus, in lieu of reinstatement, separation pay equal to one (1) month pay for every year of service;
- ORDERING Philippine Airlines, Inc. to pay attorney's fees equivalent to ten percent (10%) of the total monetary award.
Costs against respondent PAL.
WHEREFORE, for lack of merit, the Motion for Reconsideration is hereby DENIED with FINALITY. The assailed Decision dated July 22, 2008 is AFFIRMED with MODIFICATION in that the award of attorney's fees and expenses of litigation is reduced to P2,000,000.00. The case is hereby REMANDED to the Labor Arbiter solely for the purpose of computing the exact amount of the award pursuant to the guidelines herein stated.Justice Ynares-Santiago remained the ponente, and the October 2, 2009 Resolution was concurred in by Justices Chico-Nazario, Nachura, Peralta, and Bersamin. Justice Peralta replaced Justice Austria-Martinez who had already retired, and Justice Bersamin replaced Justice Leonardo-De Castro who had inhibited herself from participating in the deliberations of Philippine Airlines' Motion for Reconsideration.
No further pleadings will be entertained.
SO ORDERED.7
To conclude, the rights and privileges that PAL unlawfully withheld from its employees have been in dispute for a decade and a half. Many of these employees have since then moved on, but the arbitrariness and illegality of PAL's actions have yet to be rectified. This case has dragged on for so long and we are now more than duty-bound to finally put an end to the illegality that took place; otherwise, the illegally retrenched employees can rightfully claim that the Court has denied them justice.A series of letters dated September 13, 16, 20, and 22, 2011 were then filed by Atty. Estelito P. Mendoza, counsel for Philippine Airlines. The letters were all addressed to the Clerk of Court En Banc, not to the Justices of this Court, and questioned the transfer of the case among the Divisions. Instead of being filed under G.R. No. 178083, the letters were docketed as a separate administrative matter, A.M. No. 11-10-1-SC.
WHEREFORE, the Court resolves to deny with finality respondent PAL's second motion for reconsideration. No further pleadings shall be entertained. Costs against the respondents. Let entry of judgment be made in due course.
SO ORDERED.10
Section 2. Second motion for reconsideration. - No second motion for reconsideration of a judgment or final resolution by the same party shall be entertained.The rationale of the prohibition is further explained in Ortigas and Company Limited Partnership v. Judge Velasco:19
A second motion for reconsideration is forbidden except for extraordinarily persuasive reasons, and only upon express leave first obtained. The propriety or acceptability of such a second motion for reconsideration is not contingent upon the averment of "new" grounds to assail the judgment, i.e., grounds other than those theretofore presented and rejected. Otherwise, attainment of finality of a judgment might be staved off indefinitely, depending on the party's ingeniousness or cleverness in conceiving and formulating "additional flaws" or "newly discovered errors" therein, or thinking up some injury or prejudice to the rights of the movant for reconsideration. "Piece-meal" impugnation of a judgment by successive motions for reconsideration is anathema, being precluded by the salutary axiom that a party seeking the setting aside of a judgment, act or proceeding must set out in his motion all the grounds therefor, and those not so included are deemed waived and cease to be available for subsequent motions.As an exception, by leave of court,21 a party may file a second motion for reconsideration of the decision. The second motion for reconsideration may be subsequently granted "in the higher interest of justice." Rule 15, Section 3 of our Internal Rules provides:
For all litigation must come to an end at some point, in accordance with established rules of procedure and jurisprudence. As a matter of practice and policy, courts must dispose of every case as promptly as possible; and in fulfillment of their role in the administration of justice, they should brook no delay in the termination of cases by stratagems or maneuverings of parties or their lawyers.20
Section 3. Second motion for reconsideration. - The Court shall not entertain a second motion for reconsideration, and any exception to this rule can only be granted in the higher interest of justice by the Court en banc upon a vote of at least two-thirds of its actual membership. There is reconsideration "in the higher interest of justice" when the assailed decision is not only legally erroneous, but is likewise patently unjust and potentially capable of causing unwarranted and irremediable injury or damage to the parties. A second motion for reconsideration can only be entertained before the ruling sought to be reconsidered becomes final by operation of law or by the Court's declaration.Nothing in Rule 15, Section 3 of the Internal Rules, however, states that the resolution denying the motion for reconsideration of a decision will not lapse into finality. The grant of leave to file a second motion for reconsideration only means that the second motion for reconsideration is no longer prohibited.23 Regardless of the grant of leave to file a second motion
In the Division, a vote of three Members shall be re uired to elevate a second motion for reconsideration to the Court En Banc.22
[T]he issuance of the entry of judgment is reckoned from the time the parties received a copy of the resolution denying the first motion for reconsideration. The filing of . . . several pleadings after receipt of the resolution denying [the] first motion for reconsideration does not in any way bar the finality or entry of judgment. Besides, to reckon the finality of a judgment from the receipt of the denial of the second motion for reconsideration would be absurd. First, the Rules of Court and the Internal Rules of the Supreme Court prohibit the filing of a second motion for reconsideration. Second, some crafty litigants may resort to filing prohibited pleadings just to delay entry of judgment.26 (Underscoring in the original; emphasis supplied)Philippine Airlines received a copy of the October 2, 2009 Resolution denying its Motion for Reconsideration of the July 22, 2008 Decision on October 20, 2009.27 By operation of law, the October 2, 2009 Resolution became final and executory on November 4, 2009, 15 days after Philippine Airlines received a copy of the October 2, 2009 Resolution. Though leave to file a Second Motion for Reconsideration was granted on January 20, 2010, the grant of leave only means that the Second Motion for Reconsideration is no longer prohibited under the Rules of Court. The grant of leave to file the Second Motion for Reconsideration did not, in any way, prevent the judgment on this case from becoming final and executory on November 4, 2009.
Section 4. (1) The Supreme Court shall be composed of a Chief Justice and fourteen Associate Justices. It may sit en banc or, in its discretion, in divisions of three, five, or seven Members. Any vacancy shall be filled within ninety days from the occurrence thereof.Article VIII, Section 4 was especially relevant in Fortich v. Corona.32 The case involved the Sumilao farmers who staged a hunger strike in protest of the Office of the President's March 29, 1996 Decision that converted 144 hectares of land in Bukidnon from agricultural to agro-industrial/institutional area. In its Order dated June 23, 1997, the Office of the President declared its March 29, 1996 Decision final and executory because none of the parties seasonably filed a motion for reconsideration of the decision.
(2) All cases involving the constitutionality of a treaty, international or executive agreement, or law, which shall be heard by the Supreme Court en banc, and all other cases which under the Rules of Court are required to be heard en banc, including those involving the constitutionality, application, or operation of presidential decrees, proclamations, orders, instructions, ordinances, and other regulations, shall be decided with the concurrence of a majority of the Members who actually took part in the deliberations on the issues in the case and voted thereon.
(3) Cases or matters heard by a division shall be decided or resolved with the concurrence of a majority of the Members who actually took part in the deliberations on the issues in the case and voted thereon, and in no case, without the concurrence of at least three of such Members. When the required number is not obtained, the case shall be decided en banc: Provided, that no doctrine or principle of law laid down by the court in a decision rendered en banc or in division may be modified or reversed except by the court sitting en banc.
A careful reading of [Section 4(3), Article VIII of the Constitution], however, reveals the intention of the framers to draw a distinction between cases, on the one hand, and matters, on the other hand, such that cases are "decided" while matters, which include motions, are "resolved". Otherwise put, the word "decided" must refer to "cases"; while the word "resolved" must refer to "matters", applying the rule reddendo singula singulis. This is true not only in the interpretation of the above-quoted [Section 4(3), Article VIII], but also of the other provisions of the Constitution where these words appear.The reason for the rule, said this Court, is "simple."48 Continued this Court:
With the aforesaid rule of construction in mind, it is clear that only cases are referred to the Court en banc for decision whenever the required number of votes is not obtained. Conversely, the rule does not apply where, as in this case, the required three votes is not obtained in the resolution of a motion for reconsideration. Hence, the second sentence of the aforequoted provision speaks only of "case" and not "matter".47
The above-quoted [Article VIII, Section 4(3)] pertains to disposition of cases by a division. If there is a tie in the voting, there is no decision. The only way to dispose of the case is then refer it to the Court en banc. On the other hand, if a case has already been decided by the decision and the losing party files a motion for reconsideration, the failure of the division to resolve the motion because of a tie in the voting does not leave the case undecided. There is still the decision which must stand in view of the failure of the members of the division to muster the necessary vote for its reconsideration. Quite plainly, if the voting results in a tie, the motion for reconsideration is lost. The assailed decision is not reconsidered and must therefore be deemed affirmed.49Voting two-two on the first motion for reconsideration, the Members of the Second Division failed to muster the minimum number of votes required to reconsider the April 24, 1998 Decision in Fortich. Therefore, the first motions for reconsideration were deemed denied for failure to obtain the required number of votes, and the case was not elevated en banc.50 The April 24, 1998 Decision in Fortich, unanimously voted by the Members of the Second Division, was deemed affirmed.51
Supreme Court Circular No. 2-89 would continue outlining the guidelines for referring a Division case to the Court En Banc:SUPREME COURT CIRCULAR NO. 2-89
SUBJECT : Guidelines and Rules in the Referral to the Court En Banc of Cases Assigned to a Division TO : Court of Appeals, Sandiganbayan, Court of Tax Appeals, Regional Trial Courts, Metropolitan Trial Courts, Municipal Trial Courts, Municipal Circuit Trial Courts, Shari'A District Courts and Shari'A Circuit Courts, All Members of the Government Prosecution Service, and All Members of the Integrated Bar of the Philippines
1. The Supreme Court sits either en banc or in Divisions of three, five or seven Members (Sec. 4[1] Article VIII, 1987 Constitution). At present the Court has three Divisions of five Members each.
2. A decision or resolution of a Division of the Court, when concurred in by a majority of its Members who actually took part in the deliberations on the issues in a case and voted thereon, and in no case without the concurrence of at least three of such Members, is a decision or resolution of the Supreme Court (Section 4[3], Article VIII, 1987 Constitution).
3. The Court en banc is not an Appellate Court to which decisions or resolutions of a Division may be appealed.53
4. At any time after a Division takes cognizance of a case and before a judgment or resolution therein rendered becomes final and executory, the Division may refer the case en consulta to the Court en banc which, after consideration of the reasons of the Division for such referral, may return the case to the Division or accept the case for decision or resolution.At present, Rule 2, Section 355 of the Internal Rules enumerates the cases and matters cognizable by Court En Banc:4a. Paragraph [f] of the Resolution of this Court of 23 February 1984 in Bar Matter No. 209 [formerly item 6, en banc Resolution dated 29 September 1977], enumerating the cases considered as en banc cases, states:5. A resolution of the Division denying a party's motion for referral to the Court en banc of any Division case, shall be final and not appealable to the Court en banc."f. Cases assigned to a division including motions for reconsideration which in the opinion of at least three (3) members merit the attention of the Court en banc and are acceptable by a majority vote of the actual membership of the Court en banc."
6. When a decision or resolution is referred by a Division to the Court en banc, the latter may, in the absence of sufficiently important reasons, decline to take cognizance of the same, in which case, the decision or resolution shall be returned to the referring Division.
7. No motion for reconsideration of the action of the Court en banc declining to take cognizance of a referral by a Division, shall be entertained.54
Section 3. Court en banc matters and cases. - The Court en banc shall act on the following matters and cases:The Court En Banc assumed jurisdiction over this case based on Section 3(m), then Rule 2, Section 3(n) of the Internal Rules.
(a) cases in which the constitutionality of any treaty, international or executive agreement, law, executive order, presidential decree, proclamation, order, instruction, ordinance, or regulation is in question; (b) cases raising novel questions of law; (c) cases affecting ambassadors, other public ministers, and consuls; (d) cases involving decisions, resolutions, and resolutions, and orders of the Commission on Elections and the Commission on Audit; (e) cases where the penalty recommended or to be imposed is the dismissal of a judge, official or personnel of the Judiciary, the disbarment of a lawyer, the suspension of any of them for a period of more than one year, or a fine exceeding forty thousand pesos; (f) cases covered by the preceding paragraph involving the reinstatement in the judiciary of a dismissed judge, the reinstatement of a lawyer in the roll of attorneys, or the lifting of a judge's suspension or a lawyer's suspension from the practice of law; (g) cases involving the discipline of a Member of the Court, or a Presiding Justice, or any Associate Justice of the collegial appellate courts; (h) cases where a doctrine or principle laid down by the Court en banc or by a Division may be modified or reversed; (i) cases involving conflicting decisions of two or more divisions; (j) cases where three votes in a Division cannot be obtained; (k) Division cases where the subject matter has a huge financial impact on businesses or affects the welfare of a community; (l) subject to Section 11(b) of this rule, other division cases that, in the opinion of at least three Members of the Division who are voting and present, are appropriate for transfer to the Court en banc; (m) cases that the Court en banc deems of sufficient importance to merit its attention; and (n) all matters involving policy decisions in the administrative supervision of all courts and their personnel.56
As reflected above, the Resolution dated November 18, 1993 amended Bar Matter No. 209 which further amended Rule 136, Sections 15 and 16 of the Rules of Court then in effect, i.e., the 1964 Rules of Court. Rule 136 was entitled "Court Record and General Duties of Clerks and Stenographer" and Sections 15 and 16 dealt with "unprinted papers" and "printed papers." As the Resolution dated November 18, 1993 expressly stated, it amended the Resolution dated February 9, 1993 still on the form of unprinted papers and printed papers.B.M. No. 20961
AMENDMENTS TO SECTIONS 15 AND 16, RULE 136 OF THE RULES OF COURT AND OTHER RESOLUTIONS
Gentlemen:
Quoted hereunder, for your information, is a resolution of the Court En Banc dated November 18, 1993
"Bar Matter No. 209 - In the Matter of the Amendment and/or Clarification of Various Supreme Court Rules and Resolutions. -
The Court motu proprio Resolved to further amend Sections 15 and 16, Rule 136 of the Rules of Court, as well as its Resolution of September 17, 1974 as amended by a Resolution dated February 11, 1975, its Resolution of February 23, 1984, and its Resolution of February 9, 1993, as follows:
Effective immediately and until further action of the Court, all pleadings, briefs, memoranda, motions, and other papers to be filed before the Supreme Court and the Court of Appeals shall either be typewritten on good quality unglazed paper, or mimeographed or printed on newsprint or mimeograph paper, 11 inches in length by 8-1/2 inches in width (commonly known as letter size) or 13 inches in length by 8-1/2 inches in width (commonly known as legal size). There shall be a margin at the top and at the left-hand side of each page not less than 1-1/2 inches in width. The contents shall be written double-spaced and only one side of the page shall be used.
In the Supreme Court, eighteen (18) legible copies of the petition shall be initially be filed, and eighteen (18) copies of subsequent pleadings, briefs, memoranda, motions and other papers shall be filed in cases for consideration of the Court en banc and nine (9) copies in cases to be heard before a division.
One (1) copy thereof shall be served upon each of the adverse parties in either case.
For said purpose, the following are considered en banc cases:In the Court of Appeals, seven (7) legible copies of pleadings, briefs, memoranda, motions and other papers shall be filed and one (1) copy thereof shall be served on each of the adverse parties." (Internal Resolution - Not for release)
- Cases in which the constitutionality or validity of any treaty, international or executive agreement, law, executive order, or presidential decree, proclamation, order, instruction, ordinance, or regulation is in question;
- Criminal cases in which the appealed decision imposes the death penalty;
- Cases raising novel questions of law;
- Cases affecting ambassadors, other public ministers and consuls;
- Cases involving decisions, resolutions or orders of the Civil Service Commission, Commission on Elections, and Commission on Audit;
- Cases where the penalty to be imposed is the dismissal of a judge, officer or employee of the Judiciary, disbarment of a lawyer, or either the suspension of any of them for a period of more than one (1) year or a fine exceeding P10,000.00, or both;
- Cases where a doctrine or principle laid down by the Court en banc or in division may be modified or reversed;
- Cases assigned to a division which in the opinion of at least three (3) members thereof merit the attention of the Court en banc and are acceptable to a majority of the actual membership of the Court en banc; and
- All other cases as the Court en banc by a majority of its actual membership may deem of sufficient importance to merit its attention.
Very truly yours, LUZVIMINDA D. PUNO Clerk of Court Supreme Court of the Philippines By: (SGD.) MA. LUISA D. VILLARAMA Assistant Clerk of Court Supreme Court of the Philippines
Article 283. Closure of Establishment and Reduction of Personnel. - The employer may also terminate the employment of any employee due to the installation of labor-saving devices, redundancy, retrenchment to prevent losses or the closing or cessation of operation of the establishment or undertaking unless the closing is for the purpose of circumventing the provisions of this Title, by serving a written notice on the workers and the Ministry of Labor and Employment at least one (1) month before the intended date thereof. In case of termination due to the installation of labor-saving devices or redundancy, the worker affected thereby shall be entitled to a separation pay equivalent to at least his one (1) month pay or to at least one (1) month pay for every year of service, whichever is higher. In case of retrenchment to prevent losses and in cases of closures or cessation of operations of establishment or undertaking not due to serious business losses or financial reverses, the separation pay shall be equivalent to one (1) month pay or at least one-half (1/2) month pay for every year of service, whichever is higher. A fraction of at least six (6) months shall be considered one (1) whole year.In contrast with the "just causes" for terminating employment brought about by an employee's acts, "authorized causes" such as retrenchment are undertaken by the employer. Retrenchment or "lay-off" is the cessation of employment commenced by the employer, devoid of any fault on the part of the workers and without prejudice to them.74 It is "resorted to by management during periods of business recession, industrial depression, or seasonal fluctuations or during lulls occasioned by lack of orders, shortage of materials, conversion of the plant for a new production program or the introduction of new methods or more efficient machinery, or of automation."75
Firstly, the losses expected should be substantial and not merely de minimis in extent. If the loss purportedly sought to be forestalled by retrenchment is clearly shown to be insubstantial and inconsequential in character, the bonafide nature of the retrenchment would appear to be seriously in question. Secondly, the substantial loss apprehended must be reasonably imminent, as such imminence can be perceived objectively and in good faith by the employer. There should, in other words, be a certain degree of urgency for the retrenchment, which is after all a drastic recourse with serious consequences for the livelihood of the employees retired or otherwise laid-off. Because of the consequential nature of retrenchment, it must, thirdly, be reasonably necessary and likely to effectively prevent the expected losses. The employer should have taken other measures prior or parallel to retrenchment to forestall losses, i.e., cut other costs than labor costs. An employer who, for instance, lays off substantial numbers of workers while continuing to dispense fat executive bonuses and perquisites or so-called "golden parachutes," can scarcely claim to be retrenching in good faith to avoid losses. To impart operational meaning to the constitutional policy of providing "full protection" to labor, the employer's prerogative to bring down labor costs by retrenching must be exercised essentially as a measure of last resort, after less drastic means - e.g., reduction of both management and rank-and-file bonuses and salaries, going on reduced time, improving manufacturing efficiencies, trimming of marketing and advertising costs, etc. - have been tried and found wanting.These "four standards of retrenchment"79-that the losses be substantial and not de minimis; that the substantial loss be imminent; that the retrenchment be reasonably necessary and would likely and effectively prevent the substantial loss; and that the loss, if already incurred, be proved by sufficient and convincing evidence-are reiterated in Central Azucarera De La Carlota v. National Labor Relations Commission,80Polymart Paper Industries, Inc. v. National Labor Relations Commission,81F.F. Marine Corp. v. National Labor Relations Commission,82 and Philippine Airlines, Inc. v. Dawal.83
Lastly, but certainly not the least important, alleged losses if already realized, and the expected imminent losses sought to be forestalled, must be proved by sufficient and convincing evidence. The reason for requiring this quantum of proof is readily apparent: any less exacting standard of proof would render too easy the abuse of this ground for termination of services of employees.78 (Underscoring provided)
The only manifestation of PAL's attempt at exhausting other possible measures besides retrenchment was when it conducted negotiations and consultations with FASAP which, however, ended nowhere. None of the plans and suggestions taken up during the meetings was implemented. On the other hand, PAL's September 4, 1998 offer of shares of stock to its employees was adopted belatedly, or only after its more than 1,4000 cabin crew personnel were retrenched. Besides, this offer can hardly be considered to be borne of good faith, considering that it was premised on the condition that, if accepted, all existing CBA's between PAL and its employees would have to be suspended for 10 years. When the offer was rejected by the employees, PAL ceased its operations on September 23, 1998. It only resumed business when the CBA's suspension clause was ratified by the employees in a referendum subsequently conducted. Moreover, this stock distribution scheme does not do away with PAL's expenditures or liabilities, since it has for its sole consideration the commitment to suspend CBAs with its employees for 10 years. It did not improve the financial standing of PAL, nor did it result in corporate savings, vis-a-vis the financial difficulties it was suffering at that time.120 (Emphasis provided)Although, as pointed out by Justice Caguioa, an employer may resort to retrenchment on the basis of anticipated losses,121 the employer must nevertheless present convincing evidence which, as jurisprudentially established, consists of the audited financial statements. Here, there was no basis for Philippine Airlines to claim that it was financially crippled by the 1997 Asian financial crisis and the massive strikes staged by its workers.122 Assuming that Philippine Airlines sustained business losses due to the 1997 Asian financial crisis, it should have nevertheless corroborated its claim by showing how this occurrence affected its financial status. To readily accept this assertion, as stated in the ponencia,123 provides a dangerous precedent. "Any employer desirous of ridding itself of its employees could . . . easily do so without need to adduce proof in support of its action."124 Security of tenure is a constitutionally mandated right. It should not be "denied on the basis of mere speculation."125
[Philippine Airlines] offered no satisfactory explanation why it abandoned Plan 14; instead, it justified its actions of subsequently recalling to duty retrenched employees by making it appear that it was a show of good faith; that it was due to its good corporate nature, that the decision to consider recalling employees was made. The truth, however, is that it was unfair for PAL to have made such a move; it was capricious and arbitrary, considering that several thousand employees who had long been working with PAL had lost their jobs, only to be recalled but assigned to lower positions (i.e. demoted), and worse, some as new hires, without due regard for their long years of service with the airline.Additionally, the retrenchment program was based on unreasonable standards without any regard to each cabin crew's corresponding service record, thus discounting "seniority and loyalty in the evaluation of overall employee performance."139
The irregularity of PAL's implementation of Plan 14 becomes more apparent when it rehired 140 probationary cabin attendants whose services it had previously terminated, and yet groceeded to terminate the services of its permanent cabin crew personnel.138 (Emphasis provided)
(a) | DENY WITH FINALITY Philippine Airlines, Inc.'s Motion for Reconsideration of the Resolution of October 2, 2009 and Second Motion for Reconsideration of the Decision of July 22, 2008; |
(b) | GRANT the Flight Attendants and Stewards Association of the Philippines' Motion for Reconsideration dated October 17, 2011 and REINSTATE the Second Division's Resolution dated September 7, 2011; and |
(c) | AFFIRM this Court's Decision dated July 22, 2008 and Resolution dated October 2, 2009. |
Endnotes:
1See Revelation 20, Revised Standard Version of the Bible.
2Rollo (G.R. No. 178083), pp. 10-58.
3 617 Phil. 687 (2009) [Per J. Ynares-Santiago, Special Third Division].
4 581 Phil. 228 (2008) [Per J. Ynares-Santiago, Third Division].
5 Id. at 271-272.
6 617 Phil. 687 (2009) [Per J. Ynares-Santiago, Special Third Division].
7 Id. at 723.
8Rollo (G.R. No. 178083), p. 2220, Philippine Airlines' Second Motion for Reconsideration.
9 Id. at 3568-3571.
10 Id. at 3569-3570.
11Rollo (A.M. No. 11-10-1-SC), pp. 16-17.
12 684 Phil. 55 (2012) [Per J. Brion, En Banc].
13 Ponencia as of July 28, 2017, p. 13.
14City of Manila v. Court of Appeals, 281 Phil. 408, 413 (1991) [Per J. Cruz, En Banc].
15Commissioner on Internal Revenue v. Visayan Electric Company, 125 Phil. 1125, 1127 (1967) [Per J. Sanchez, En Banc].
16 RULES OF COURT, Rule 52, sec. 1.
17 S. CT. INT. RULES,, Rule 15, secs. 1 and 2.
18Commissioner on Internal Revenue v. Visayan Electric Company, 125 Phil. 1125, 1127 (1967) [Per J. Sanchez, En Banc].
19 324 Phil. 483 (1996) [Per C.J. Narvasa, Third Division].
20 Id. at 489-490.
21Ortigas and Company Limited Partnership v. Judge Velasco, 324 Phil. 483, 489 (1996) [Per C.J. Narvasa, Third Division]; See McBurnie v. Ganzon, 719 Phil. 680 (2013) [Per J. Reyes, En Banc].
22 S. CT. INT. RULES,, Rule 15, sec. 3.
23See McBurnie v. Ganzon, 719 Phil. 680 (2013) [Per J. Reyes, En Banc].
24See Muñoz v. Court of Appeals, 379 Phil. 809 (2000) [Per J. Ynares-Santiago, First Division].
25 665 Phil. 542 (2011) [Per J. Del Castillo, First Division].
26 Id.
27Rollo (G.R. No. 178083), p. 2220, Philippine Airlines' Second Motion for Reconsideration.
28Ponencia, p. 19
29 83 Phil. 337 (1949) [Per J. Paras, First Division].
30Ponencia, p. 19.
31 RULES OF COURT, Rule 51, sec. 10.
32 352 Phil. 461 (1998) [Per J. Martinez, Second Division]; 359 Phil. 210 (1998) [Per J. Martinez, Second Division]; 371 Phil. 672 (1999) [Per J. Ynares-Santiago, Special Second Division].
33 352 Phil. 461 (1998) [Per J. Martinez, Second Division].
34 Id. at 486.
35 1d. at 485.
36 Id. at 464.
37 Id. at 487.
38 359 Phil. 210 (1998) [Per J. Martinez, Second Division].
39 Id. at 214.
40 Id. at 230.
41 Id. at 221-222.
42 Id. at 230.
43 Id. at pp. 230-238. Reviewing the records of the case, Justice Puno found that six (6) months past the issuance of the March 29, 1996 Decision of the Office of the President, then President Fidel V. Ramos constituted a Presidential Fact-Finding Task Force "to conduct a comprehensive review of the proper land use of the 144-hectare Sumilao property." President Ramos, according to Justice Puno, continued to treat the farmer-beneficiaries' case before the Office of the President as "still open," a power allegedly subsumed in the President's power of control over the executive branch. In effect, Justice Puno was of the opinion that the Office of the President may still resolve the motion for reconsideration filed by the farmer-beneficiaries, this despite the Office of the President's Order dated June 23, 1997 declaring its own March 29, 1996 Decision final and executory.
44 Justice Regalado retired on October 13, 1998. The Resolution denying the first motions for reconsideration was issued on November 17, 1998.
45 371 Phil. 672 (1999) [Per J. Ynares-Santiago, Special Second Division].
46Reddenda singula singulis is Latin for "referring each for each" and, as a rule of statutory construction, means that "words in different parts of statute must be referred to their appropriate connection, giving to each in its place, its proper force and effect, and, if possible, rendering none of them useless or superfluous, even if strict grammatical construction demands otherwise." See People v. Tamani, 154 Phil. 142, 147 (1974) [Per J. Aquino, Second Division] and City of Manila v. Laguio, Jr., 495 Phil. 289, 336 (2005) [Per J. Tinga, En Banc].
47Fortich v. Corona, 371 Phil. 672, 679 (1999) [Per J. Ynares-Santiago, Special Second Division].
48 Id.
49 Id. at 679-680.
50 Id. at 683.
51 Id. at 680.
52See Aboitiz Shipping Corporation v. New India Assurance Company, Ltd., 557 Phil. 679, 683 (2007) [Per J. Quisumbing, Second Division].
53 SC Circ. No. 2-89 (1989).
54 Id.
55 S. CT. INT. RULES, Rule 2, sec. 3 as amended.
56 Id.
57Lu v. Lu Ym, Sr. et al., 658 Phil. 156, 175 (2011) [Per J. Carpio Morales, En Banc].
58Firestone Ceramics, Inc. v. Court of Appeals, 389 Phil. 810, 816 (2000) [Per J. Purisima, En Banc].
59Lu v. Lu Ym, Sr. et al., 658 Phil. 156, 175 (2011) [Per J. Carpio Morales, En Banc].
60Firestone Ceramics, Inc. v. Court of Appeals, 389 Phil. 810, 816 (2000) [Per J. Purisima, En Banc].
61 SC Bar Matter No. 209 (1993).
62 J. Gonzaga-Reyes' Dissenting Opinion in Firestone Ceramics, Inc. v. Court of Appeals, 389 Phil. 810, 825 (2000) [Per J. Purisima, En Banc].
63Firestone Ceramics, Inc. v. Court of Appeals, 389 Phil. 810, 818 (2000) [Per J. Purisima, En Banc].
64Rollo, p. 16. The Court cited as bases Sections 3(m) and (n), now 3(l) and (m) of the Internal Rules of the Supreme Court.
65Ponencia, p. 24-25.
66 See Sections 3(l) and (m) in relation to section 11 of the Internal Rules of the Supreme Court, thus:Section 3. Court En banc Matters and Cases. - The Court en banc shall act on the following matters and cases:67In Re: Letters of Atty. Mendoza re: G.R. No. 178083-FASAP v. PAL, Inc. et al., 684 Phil. 55, 92 (2012) [Per J. Brion, En Banc].. . . .Section 11. Actions on Cases Referred to the Court En Banc - The referral of a Division case to the Court en banc shall be subject to the following rules:
(l) subject to Section 11(b) of this rule, other division cases that, in the opinion of at least three Members of the Division who are voting and present, are appropriate for transfer to the Court en banc; (m) cases that the Court en banc deems of sufficient important to merit its attention[.]
. . . .
(a) the resolution of a Division denying a motion for referral to the Court en banc shall be final and shall not be appealable to the Court en banc; (b) the Court en banc may, in the absence of sufficiently important reasons, decline to take cognizance of a case referred to it and return the case to the Division; and (c) No motion for reconsideration of a resolution of the Court en banc declining cognizance of a referral by a Division shall be entertained.
68See J. Douglas' Dissenting Opinion in Johnson v. Louisiana, 406 U.S. 356, 383 (1972) [Per J. White, United States Supreme Court]. The issue in Johnson was whether a less than unanimous vote of the jury is sufficient to convict an accused under the Sixth Amendment. The United States Supreme Court ruled in the affirmative with Justice Douglas, among other Justices, dissenting. Justice Douglas was of the view that unanimity should be required for convictions because they involve the right to liberty the deprivation of which should be based on the same strict standard required for depriving the right to property, i.e., unanimous vote of a jury. Justice Douglas explained the reasons why a mere plurality vote "diminishes the reliability of a jury":The plurality approves a procedure which diminishes the reliability of a jury. First, it eliminates the circumstances in which a minority of jurors (a) could have rationally persuaded the entire jury to acquit, or (b) while unable to persuade the majority to acquit, nonetheless could have convinced them to convict only a lesser included offense. Second, it permits prosecutors in Oregon and Louisiana to enjoy a conviction-acquittal ratio substantially greater than that ordinarily returned by unanimous juries.Although Johnson involved jury voting, this Court, like a jury, is a collegial body that decides collectively through the votes of its Members. Therefore, the advantages and disadvantages of different electoral systems, such as plurarity or majoritarian systems, must equally apply to a collegial body such as this Court.
The diminution of verdict reliability flows from the fact that nonunaninmous juries need not debate and deliberate as fully as must unanimous juries. As soon as the requisite majority is attained, further consideration is not required either by Oregon or by Louisiana, even though the dissident jurors might, if given the chance, be able to convince the majority. . . .
69 CONST., art. III, sec. 1 provides:
Section 1. No person shall be deprived of life, liberty, or property without due process of law, nor shall any person be denied the equal protection of the laws.
70 CONST., art. VIII, sec. 4(2) provides:
Section 4.
. . . .
(2) All cases involving the constitutionality of a treaty, international or executive agreement, or law, which shall be heard by the Supreme Court en banc, and all other cases which under the Rules of Court are required to be heard en banc, including those involving the constitutionality, application, or operation of presidential decrees, proclamations, orders, instructions, ordinances, and other regulations, shall be decided with the concurrence of a majority of the Members who actually took part in the deliberations on the issues in the case and voted thereon.
71 INTERNAL RULES OF THE SUPREME COURT, Rule 15, sec. 3.
72Concepcion v. Garcia, 54 Phil. 81, 83 (1929) [Per J. Street, En Banc].
73 Now Article 289 of the Labor Code pursuant to Presidential Decree No. 442 (2015).
74Polymart Paper Industries, Inc. v. National Labor Relations Commission, 355 Phil. 592, 599 (1998) [Per J. Martinez, Second Division].
75 Id.
76See Sanoh Fulton Phils., Inc. v. Bernardo, 716 Phil. 378 (2013) [Per J. Perez, Second Division].
77 267 Phil. 212 (1990) [Per J. Feliciano, Third Division].
78 Id. at 221-222.
79Central Azucarera De La Carlota v. National Labor Relations Commission, 321 Phil. 989, 995 (1995) [Per J. Kapunan, First Division].
80 321 Phil. 989, 996 (1995) [Per J. Kapunan, First Division].
81 355 Phil. 592, 600-601 (1998) [Per J. Martinez, Second Division].
82 495 Phil. 140, 152-153 (2005) [Per J. Tinga, Second Division].
83 G.R. Nos. 173921 & 173952, February 24, 2016 [Per J. Leonen, Second Division].
84Philippine Tobacco Flue-Curing & Redrying Corp. v. NLRC, 360 Phil. 218, 236-237 (1998) [Per J. Panganiban, First Division], citing Somerville Stainless Steel Corporation v. NLRC, 350 Phil. 859, 869 (1998) [Per J. Panganiban, First Division].
85Manatad v. Philippine Telegraph and Telephone Corp., 571 Phil. 494, 508 (2008) [Per J. ChicoNazario, Third Division].
86Hyatt Enterprises of the Philippines, Inc. v. Samahan ng Mga Manggagawa sa Hyatt, 606 Phil. 490, 507 (2009) [Per J. Nachura, Third Division].
87 Id. at 510
88 146 Phil. 153 (1970) [Per J. Ruiz Castro, En Banc].
89 Id. at 157 and 166.
90 325 Phil. 202 (1996) [Per J. Panganiban, En Banc].
91 Id. at 212.
92 571 Phil. 494 (2008) [Per J. Chico-Nazario, Third Division].
93 Id. at 509.
94Rollo (G.R. No. 178083), p. 1534, Decision dated July 22, 2008.
95 Id. at 1537.
96 Id. at 2046, Resolution dated October 2, 2009.
97 Id. at 1552-1553, Motion for Reconsideration of July 22, 2008 Decision.
98 J. Caguioa's Concurring Opinion, p. 10, citing Alfelor v. Halasan, 520 Phil. 982 (2006) [Per J. Callejo, Sr., First Division].
99 See Rollo (G.R. No. 178083), p. 2240, PAL's Second MR
100 Justice Caguioa's Concurring Opinion, p. 13.
101 558 Phil. 328 (2007) [Per J. Quisumbing, Second Division]. This Court ruled that Philippine Airlines was justified in not reinstating the employees pending the appeal before the NLRC due to the fact that it was under corporate rehabilitation.
102 438 Phil. 375 (2002) [Per J. Vitug, First Division]. The money claims for the missing luggage of respondent Spouses Kurangking and Spouses Dianalan were held to be "a financial demand that the law requires to be suspended during rehabilitation proceedings."
103 552 Phil. 118 (2007) [Per J. Chico-Nazario, Third Division]. This Court suspended the proceedings involving the award of 13th month pay to PALEA members because PAL was under corporate rehabilitation.
104 648 Phil. 238 (2010) [Per J. Leonardo-De Castro, First Division]. The proceedings involving the dismissal of respondent Quijano and her claim for separation pay was suspended because PAL was under corporate rehabilitation.
105 543 Phil. 546 (2007) [Per J. Chico-Nazario, Third Division]. The proceedings involving the dismissal of respondent Zamora and his money claims was suspended because PAL was under corporate rehabilitation.
106 500 Phil. 61 (2005) [Per J. Carpio Morales, Third Division].
107 Id. at 69.
108 Id. at 80.
109FASAP v. PAL, 581 Phil. 228, 258 (2008) [Per J. Carpio Morales, Third Division].
110 Id.
111 Id. at 262.
112 Id. at 245.
113 471 Phil. 460, 476 (2004) [Per J. Panganiban, First Division].
114Rollo (G.R. No. 178083), p. 2281.
115Emco Plywood Corp. v. Abelgas, 471 Phil. 460,476 (2004) [Per J. Panganiban, First Division].
116 CONST., art., XIII, sec. 3 provides:
Section 3. The State shall afford full protection to labor, local and overseas, organized and unorganized, and promote full employment and equality of employment opportunities for all.
It shall guarantee the rights of all workers to self-organization, collective bargaining and negotiations, and peaceful concerted activities, including the right to strike in accordance with law. They shall be entitled to security of tenure, humane conditions of work, and a living wage. They shall also participate in policy and decision-making processes affecting their rights and benefits as may be provided by law.
The State shall promote the principle of shared responsibility between workers and employers and the preferential use of voluntary modes in settling disputes, including conciliation, and shall enforce their mutual compliance therewith to foster industrial peace.
The State shall regulate the relations between workers and employers, recognizing the right of labor to its just share in the fruits of production and the right of enterprises to reasonable returns on investments, and to expansion and growth.
117Bataan Shipyard and Engineering Co., Inc. v. National Labor Relations Commission, 244 Phil. 280, 284 (1988) [Per J. Gancayco, First Division].
118Emco Plywood Corp. v. Abelgas, 471 Phil. 460, 476 (2004) [Per J. Panganiban, First Division].
119Rollo (G.R. No. 178083), p. 1536, Decision dated July 22, 2008.
120 Id.
121 J. Caguioa's Concurring Opinion, p. 12, citing Blue Eagle Management v. Naval, G.R. No. 192488, April 19, 2016, <http://sc.judiciary.gov.ph/pdf/web/viewer.html?file=/jurisprudence/2016/april2016/192488.pdf> [Per J. Leonardo-De Castro, First Division].
122Rollo (G.R. No. 178083), p. 1557, Motion for Reconsideration of July 22, 2008 Decision.
123Ponencia as of July 28, 2017, p. 25 states:
Besides, we take notice of the fact that airline operations are capital intensive earnings are volatile because of their vulnerability to economic recession, among others. The Asian financial crisis in 1997 had wrought havoc among the Asian air carriers, PAL included. The peculiarities existing in the airlines business made it easier to believe that at the time of the Asian Financial crisis, PAL incurred liabilities amounting to P90,642,933,919.00, which were way beyond the value of its assets that only stood at P85,109,075,351.
124Indino v. National Labor Relations Commission, 258 Phil. 792, 800 (1989) [Per J. Sarmiento, Second Division].
125 Id.
126Rollo (G.R. No. 178083), p. 1535, Decision dated July 22, 2008.
127Philippine Airlines, Inc. v. Dawal, G.R. Nos. 173921 & 173952, February 24, 2016, <http://sc.judiciary.gov.ph/pdf/web/viewer.html?file=/jurisprudence/2016/february2016/173921.pdf> 21 [Per J. Leonen, Second Division].
128 Id. at 22.
129 Id. at 23.
130Ponencia as of July 28, 2017, p. 27.
131Rollo (G.R. No. 178083), p. 1569, Motion for Reconsideration of July 22, 2008 Decision.
132 Id.
133 Id.
134 Id. at 1571-1572.
When PAL ceased its operations on September 23, 1998, President Joseph Estrada intervened through the request of PAL employees. PALEA made another offer which was ratified by the employees on October 2, 1998 and consequently accepted by PAL. On October 7, 1998, PAL partially began with domestic operation hoping "that the mutually beneficial terms of the suspension of the agreement could possibly redeem PAL."
135 Id. at 1572.
136 Id. at 1540, Decision dated July 22, 2008.
137 Id. at 1544.
138 Id. at 1540-1541.
139 Id. at 513, Labor Arbiter's Decision.
140 Id. at 1539, Decision dated July 22, 2008.
141Remerco Garments Manufacturing v. Minister of Labor and Employment, 219 Phil. 681, 689 (1985) [Per J. Cuevas, Second Division].
142Am-Phil Food Concepts, Inc. v. Padilla, 744 Phil. 674, 690 (2014) [Per J. Leonen, Second Division].
143Rollo, G.R. No. 178083, p. 510, Labor Arbiter's Decision.
144 Id.
145 LABOR CODE, art. 248(a) (renumbered as art. 258). See Lopez Sugar Corp. v. Franco, 497 Phil. 806 (2005) [Per J. Callejo, Sr., Second Division].
146F.F. Marine Corp. v. National Labor Relations Commission, 495 Phil. 140, 158 (2005) [Per J. Tinga, Second Division].
147 Id.
148 Id. at 151.
149 Id.
150 Id.
151Bataan Shipyard and Engineering Co., Inc. v. National Labor Relations Commission, 244 Phil. 280, 284 (1988) [Per J. Gancayco, First Division].
152 Id.
153Apo Fruits Corporation v. Land Bank of the Philippines, 647 Phil. 251, 288 (2010) [Per J. Brion, En Banc].
154See Sacdalan v. Court of Appeals, 472 Phil. 652 (2004) [Per J. Austria-Martinez, Second Division].
CAGUIOA, J.:
As the narration in this Resolution shows, the Court acted on its own pursuant to its power to recall its own orders and resolutions before their finality. The October 4, 2011 Resolution was issued to determine the propriety of the September 7, 2011 Resolution given the facts that came to light after the ruling Division's examination of the records. xxx15With the foregoing narration serving as the backdrop and context, it is easier now to see that the procedural issues raised by J. Leonen in his dissent have all been amply addressed by the March 2012 Resolution of the Court en banc.
WHEREFORE, premises considered, we hereby confirm that the Court en banc has assumed jurisdiction over the resolution of the merits of the motions for reconsideration of Philippine Airlines, Inc., addressing our July 22, 2008 Decision and October 2, 2009 Resolution; and that the September 7, 2011 ruling of the Second Division has been effectively recalled. xxx16Clearly, based on the March 2012 Resolution and its detailed narration of the events that transpired within the Court, the Court's disposition in A.M. No. 11-10-1-SC did not override, but merely clarified, the Court en banc's actions and issuances in the present case (i.e., G.R. No. 178083).
At the outset, the Court emphasizes that second and subsequent motions for reconsideration are, as a general rule, prohibited. Section 2, Rule 52 of the Rules of Court provides that "[n]o second motion for reconsideration of a judgment or final resolution by the same party shall be entertained." The rule rests on the basic tenet of immutability of judgments. "At some point, a decision becomes final and executory and, consequently, all litigations must come to an end."In this instance, PAL received a copy of the October 2009 Resolution denying its Motion for Reconsideration of the 2008 Decision on October 20, 2009. On November 3, 2009, PAL asked for leave of court to file (a) an MR of the October 2009 Resolution; and (b) a 2nd MR of the 2008 Decision. On January 20, 2010, the Court, through the Third Division, granted PAL's Motion for Leave.
The general rule, however, against second and subsequent motions for reconsideration admits of settled exceptions. For one, the present Internal Rules of the Supreme Court, particularly Section 3, Rule 15 thereof, provides:Sec. 3. Second motion for reconsideration. - The Court shall not entertain a second motion for reconsideration, and any exception to this rule can only be granted in the higher interest of justice by the Court En Banc upon a vote of at least two-thirds of its actual membership. There is reconsideration "in the higher interest of justice" when the assailed decision is not only legally erroneous, but is likewise patently unjust and potentially capable of causing unwarranted and irremediable injury or damage to the parties. A second motion for reconsideration can only be entertained before the ruling sought to be reconsidered becomes final by operation of law or by the Court's declaration.In a line of cases, the Court has then entertained and granted second motions for reconsideration "in the higher interest of substantial justice," as allowed under the Internal Rules when the assailed decision is "legally erroneous," "patently unjust" and "potentially capable of causing unwarranted and irremediable injury or damage to the parties." In Tirazona v. Philippine EDS Techno-Service, Inc. (PET, Inc.), we also explained that a second motion for reconsideration may be allowed in instances of "extraordinarily persuasive reasons and only after an express leave shall have been obtained." In Apo Fruits Corporation v. Land Bank of the Philippines, we allowed a second motion for reconsideration as the issue involved therein was a matter of public interest, as it pertained to the proper application of a basic constitutionally-guaranteed right in the government's implementation of its agrarian reform program. In San Miguel Corporation v. NLRC, the Court set aside the decisions of the LA and the NLRC that favored claimants-security guards upon the Court's review of San Miguel Corporation's second motion for reconsideration. In Vir-Jen Shipping and Marine Services, Inc. v. NLRC, et al., the Court en banc reversed on a third motion for reconsideration the ruling of the Court's Division on therein private respondents' claim for wages and monetary benefits.20
xxxx (Emphasis ours)
As a rule, a final judgment may no longer be altered, amended or modified, even if the alteration, amendment or modification is meant to correct what is perceived to be an erroneous conclusion of fact or law and regardless of what court, be it the highest Court of the land, rendered it. In the past, however, we have recognized exceptions to this rule by reversing judgments and recalling their entries in the interest of substantial justice and where special and compelling reasons called for such actions.Thus, the power of the Court to entertain PAL's 2nd MR (and even a Third Motion for Reconsideration) and to grant such motion should the interest of substantial justice so warrant is undoubtedly clear and unequivocal. Accordingly, even on the assumption that this is PAL's Third Motion for Reconsideration (which, as explained, it is not), the power of the Court to grant PAL's motion is not negated.
Notably, in San Miguel Corporation v. National Labor Relations Commission, Galman v. Sandiganbayan, Philippine Consumers Foundation v. National Telecommunications Commission, and Republic v. de los Angeles, we reversed our judgment on the second motion for reconsideration, while in Vir-Jen Shipping and Marine Services v. National Labor Relations Commission, we did so on a third motion for reconsideration. In Cathay Pacific v. Romillo and Cosio v. de Rama, we modified or amended our ruling on the second motion for reconsideration. More recently, in the cases of Munoz v. Court of Appeals, Tan Tiac Chiong v. Hon. Cosico, Manotok IV v. Barque, and Barnes v. Padilla, we recalled entries of judgment after finding that doing so was in the interest of substantial justice. In Barnes, we said:xxx Phrased elsewise, a final and executory judgment can no longer be attacked by any of the parties or be modified, directly or indirectly, even by the highest court of the land.That the issues posed by this case are of transcendental importance is not hard to discern from these discussions. A constitutional limitation, guaranteed under no less than the all-important Bill of Rights, is at stake in this case: how can compensation in an eminent domain be "just" when the payment for the compensation for property already taken has been unreasonably delayed? To claim, as the assailed Resolution does, that only private interest is involved in this case is to forget that an expropriation involves the government as a necessary actor. It forgets, too, that under eminent domain, the constitutional limits or standards apply to government who carries the burden of showing that these standards have been met. Thus, to simply dismiss this case as a private interest matter is an extremely shortsighted view that this Court should not leave uncorrected.23
However, this Court has relaxed this rule in order to serve substantial justice considering (a) matters of life, liberty, honor or property, (b) the existence of special or compelling circumstances, (c) the merits of the case, (d) a cause not entirely attributable to the fault or negligence of the party favored by the suspension of the rules, (e) a lack of any showing that the review sought is merely frivolous and dilatory, and (f) the other party will not be unjustly prejudiced thereby.
Invariably, rules of procedure should be viewed as mere tools designed to facilitate the attainment of justice. Their strict and rigid application, which would result in technicalities that tend to frustrate rather than promote substantial justice, must always be eschewed. Even the Rules of Court reflects this principle. The power to suspend or even disregard rules can be so pervasive and compelling as to alter even that which this Court itself had already declared to be final. [Emphasis supplied.]
WHEREFORE, premises considered, we hereby confirm that the Court en banc has assumed jurisdiction over the resolution of the merits of the motions for reconsideration of Philippine Airlines, Inc., addressing our July 22, 2008 Decision and October 2, 2009 Resolution; and that the September 7, 2011 ruling of the Second Division has been effectively recalled. xxx28 (Emphasis in the original omitted; emphasis and underscoring supplied)Thus, for the Court of today, or more specifically, the dissent, to question what has clearly and already been resolved at least six (6) years ago, is to second guess the wisdom of what, for all intents and purposes, is already a final disposition of this issue. In this sense, it can be rightly said that the October 2011 Resolution and March 2012 Resolution have become immutable.
xxx To the Court's mind, this admission constitutes a "deliberate, clear and unequivocal" statement; made as it was in the course of judicial proceedings, such statement qualifies as a judicial admission. A party who judicially admits a fact cannot later challenge that fact as judicial admissions are a waiver of proof; production of evidence is dispensed with. A judicial admission also removes an admitted fact from the field of controversy. Consequently, an admission made in the pleadings cannot be controverted by the party making such admission and are conclusive as to such party, and all proofs to the contrary or inconsistent therewith should be ignored, whether objection is interposed by the party or not. The allegations, statements or admissions contained in a pleading are conclusive as against the pleader. A party cannot subsequently take a position contrary of or inconsistent with what was pleaded.32 (Underscoring supplied)The records amply show that Petitioner had categorically admitted PAL's grave financial condition during this time, as follows:
The foregoing express, positive and categorical statements of Petitioner in its pleadings as regards the severe losses incurred by PAL qualify as judicial admissions, which dispense with proof or evidence.
[A.] At the outset, it must be pointed out that complainant was never opposed to the retrenchment program itself, as it understands respondent PAL's financial troubles. In fact, complainant religiously cooperated with respondents in their quest for a workable solution to the company-threatening problem. xxx33 [B.] It must be stressed that complainant was never opposed to respondent['s] retrenchment program as it truly understands respondent PAL's financial position. As a matter of fact, when it became apparent that the company was already in the brink of bankruptcy, complainant actively participated in fashioning out some workable solutions to the problem. xxx34 [C.] xxx The Philippines likewise incurred immense business misfortune affecting a multitude of industries, including respondent airline. Losses aggravated when concerted activities of the other unions, namely the Airline Pilots Association of the Philippines (ALPAP) and the Philippine Airlines Employees Association (PALEA), were held xxx FASAP did not believe that a strike would be beneficial to both parties and was of the opinion that the same would cause further losses on the part of the respondent airline to the detriment of both parties. xxx35 [D.] xxx It is worthy to note that complainant is not questioning the reason for adopting retrenchment. Complainant knows the financial woes of respondent airline. xxx36 [E.] PAL encountered massive losses. This is beyond question. FASAP, in fact, is not questioning the business reverses PAL met. xxx37 [F.] In 1997, a severe massive economic crisis hit the whole of Asia and the Pacific region. Philippine businesses incurred immense losses. PAL was not spared from the harsh effects of the crisis as it too fell prey to financial reverses, xxx.38
In its ordinary connotation, the phrase "to prevent losses" means that retrenchment or termination of the services of some employees is authorized to be undertaken by the employer sometime before the anticipated losses are actually sustained or realized. It is not, in other words, the intention of the lawmaker to compel the employer to stay his hand and keep all his employees until after losses shall have in fact materialized. If such an intent were expressly written into the law, that law may well be vulnerable to constitutional attack as unduly taking property from one man to be given to another.43 (Emphasis supplied)Given the foregoing, it would truly be derisive of this Court to maintain the necessity of presenting financial statements showing actual loss prior to a valid exercise of retrenchment.
From the above-quoted provisions of P.D. No. 902-A, as amended, the appointment of a receiver or management committee by the SEC presupposes a finding that, inter alia, a company possesses sufficient property to cover all its debts but "foresees the impossibility of meeting them when they respectively fall due" and "there is imminent danger of dissipation, loss, wastage or destruction of assets of other properties or paralization of business operations."In finding that receivership suffices as proof of severe financial reverses, it was therefore decided that retrenchment was justified and that there was no illegal dismissal despite Clarion's failure to present the necessary financial statements before the Labor Arbiter.
That the SEC, mandated by law to have regulatory functions over corporations, partnerships or associations, appointed an interim receiver for the EYCO Group of Companies on its petition in light of, as quoted above, the therein enumerated "factors beyond the control and anticipation of the management" rendering it unable to meet its obligation as they fall due, and thus resulting to "complications and problems ... to arise that would impair and affect [its] operations..." shows that CLARION, together with the other member-companies of the EYCO Group of Companies, was suffering business reverses justifying, among other things, the retrenchment of its employees.46 (Emphasis and underscoring supplied)
Endnotes:
1J. Leonen, Dissenting Opinion, p. 5.
2 Id. at 18.
3 Id. at 19.
4 Resolution, p. 16. Emphasis and underscoring supplied.
5In re: Letters of Atty. Mendoza re: G.R. No. 178083 - FASAP v. PAL, Inc., et al., 684 Phil. 55 (2012).
6 Id. at 74-75.
7 Id. at 76-77.
8 Id. at 77, 79.
9 For a detailed explanation regarding the changes in the membership of the Third Division that rendered the relevant Decision and Resolution, please refer to the Court en banc's March 2012 Resolution in A.M. No. 11-10-1-SC. See id. at 74-85.
10 Id. at 79.
11 Id. at 85. Emphasis omitted.
12 Id. at 86-87.
13 Id. at 91. Emphasis omitted.
14 Id. at 91-92.
15 Id. at 92. Emphasis omitted.
16 Id. at 99. Emphasis in the original omitted; emphasis and underscoring supplied.
17 Id. Emphasis omitted.
18J. Leonen, Dissenting Opinion, p. 6.
19 719 Phil. 680 (2013).
20 Id. at 700-702.
21Club Filipino, Inc. v. Bautista, 750 Phil. 599, 616 (2015); penned by J. Leonen.
22 See id. at 616.
23Apo Fruits Corporation v. Land Bank of the Phils., 647 Phil. 251, 288-290 (2010).
24 389 Phil. 810 (2000).
25 Id. at 825.
26 The September 7, 2011 Resolution denied with finality PAL's second motion for reconsideration.
27In re: Letters of Atty. Mendoza re: G.R. No. 178083 - FASAP v. PAL, Inc., et al., supra note 5, at 93. Emphasis omitted.
28 Id. at 99.
29 352 Phil. 461 (1998); 359 Phil. 210 (1998); 371 Phil. 672 (1999).
30J. Leonen, Dissenting Opinion, p. 21.
31 520 Phil. 982 (2006).
32 Id. at 990-991.
33Rollo, Vol. I, pp. 113-114.
34 Id. at 164-165.
35 Id. at 176.
36 Id. at 196.
37 Id. at 549
38 Id. at 550.
39 See Precision Electronics Corporation v. NLRC, 258-A Phil. 449, 451-452 (1989).
40 See Lambert Pawnbrokers and Jewelry Corporation v. Binamira, 639 Phil. 1, 12 (2010). See also Manatad v. Philippine Telegraph and Telephone Corporation, 571 Phil. 494, 508-509 (2008).
41 785 Phil. 133, 156 (2016).
42 315 Phil. 372, 390 (1995).
43Blue Eagle Management, Inc. v. Naval, supra note 41, at 156.
44 500 Phil. 61 (2005).
45 Id. at 75-76.
46 Id. at 79.
47 552 Phil. 118 (2007).
48 648 Phil. 238 (2010).
49 G.R. No. 123238, July 11, 2005 (Unsigned Resolution).
50 596 Phil. 500 (2009).
51 438 Phil. 375 (2002).
52 558 Phil. 328 (2007).
53 543 Phil. 546 (2007).
54 425 Phil. 169 (2002).