- Petitioner
- Wenphil Corporation
- Respondent
- Abing
- Citation
- G.R. No. 207983
- Court
- Supreme Court
- Division
- Second Division
- Ponente
- Brion, J.
- Decided
- April 7, 2014
Whether dismissed employees are entitled to backwages during the period of appeal of a reinstatement order, even when their dismissal is ultimately…
Summary
This case involves the entitlement of dismissed employees to backwages during the appeal period of a labor arbiter's reinstatement order. Wenphil Corporation dismissed employees Abing and Tuazon in 2000. The Labor Arbiter found the dismissal illegal and ordered reinstatement with backwages. During Wenphil's appeal, the parties entered a compromise agreement providing that Wenphil's wage payment obligation would cease if the LA's decision was 'modified, amended or reversed' by the NLRC. When the NLRC affirmed the illegal dismissal but changed the remedy from reinstatement to separation pay, Wenphil stopped paying wages. The Court of Appeals later found the dismissal was valid, which the Supreme Court affirmed. The Supreme Court ruled that employees are entitled to backwages during the appeal period until a higher court reverses the illegal dismissal finding, regardless of compromise agreements that attempt to waive this statutory right. The Court clarified that separation pay cannot substitute for backwages as they serve different purposes - separation pay looks forward while backwages compensate for lost income during the illegal dismissal period.