Gil Capili v. NLRC

Summary

This case involved eight jeepney drivers who stopped working after being required to sign lease contracts, believing this would terminate their employer-employee relationship. The Labor Arbiter found abandonment due to misunderstanding and ordered reinstatement without back wages. The NLRC modified this to award separation pay citing strained relations. The Supreme Court reversed, establishing that separation pay cannot be awarded without actual illegal dismissal and cannot be justified solely by strained relations. The Court emphasized that separation pay requires actual dismissal by the employer, and since the drivers voluntarily chose not to return to work, they were deemed to have resigned. This decision clarified the legal boundaries for separation pay awards and reinforced that labor protection does not extend to cases lacking illegal dismissal.