5-Nueva Ecija Vs NLRC

University of the Philippines College of Law
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Topic Right to Self-Organization

Case No. G.R. No. 116066. January 24, 2000
Case Name Nueva Ecija Electric Coop Employees (NEECO) Assn. Pres Jimenez, et al
vs NLRC, NEECO, Dela Pena
Ponente QUISUMBING, j.
RELEVANT FACTS
Petitioners Fajardo et al were permanent employees of NEECO I) They were members of NEECO I
Employees Association, a labor organization established for the mutual aid and protection of its
members. Jimenez was the president of the association.
NEECO I is an electric cooperative under the general supervision and control of the National
Electrification Administration (NEA). The management of NEECO I is vested on the Board of Directors.
Dela Pea was NEECOs general manager on detail from NEA.
The Board of Directors adopted Policy No. 3-33, which set the guidelines for NEECO’s retirement
benefits. All regular employees were ordered by NEECO I to accomplish Form 87, which were
applications for either retirement, resignation, or separation from service.
The applications of Petitioners Baguisa and Guevarra were approved and were paid the appropriate
separation pay.
These successive events, followed by the promotion of certain union officers to supervisory rank, caused
apprehension in the labor association. They were considered as harassment threatening the union
members, and circumventing the employees’ security of tenure. To strengthen and neutralize
managements arbitrary moves, the union held a "snap election" of officers. Petitioner Fajardo was elected
Treasurer, while Petitioners Guevarra, Carillo and Marin were elected Public Relations Officers for Jaen,
Gapan A and Gapan B, respectively.
The association then passed a resolution withdrawing the applications for retirement for all its members.
Subsequently, Marin, Fajardo, and Carillo were compulsorily retired by management and received their
separation pay under protest, while Javate was terminated allegedly due to misappropriation of funds
and dishonesty.
Thus, Fajardo et al instituted a complaint for illegal dismissal and damages with the NLRC alleging they
were purposely singled out for retirement from a listing of employees who were made to submit retirement
forms, even if they were not on top of the list because they were union officers, past officers or active
members of the association. Further, they claimed that their acceptance of the money did not constitute
estoppel nor waiver, since their acceptances were with vehement objections and without prejudice to all
their rights resulting from an illegal dismissal. Additionally, Javate averred he was framed up and
dismissed without due process.
LA ruled for Fajardo et al and declared NEECO guilty of illegal dismissal and ULP. It ordered the
reinstatement with backwages of petitioners. It also awarded moral and exemplary damages.
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NEECO appealed to NLRC, but Fajardo et al filed an omnibus motion to dismiss on the ground of late
appeal, claiming that insufficient bond was filed by NEECO I only on January 5, 1993. NLRC still gave
due course to the appeal. It affirmed deleted the award for damages and applied the amounts their
received as retirement benefits to the backwages due them.
ISSUE AND RATIO DECIDENDI
Issue Ratio
W W/N the award of moral YES
and exemplary damages
was proper? To warrant an award of moral damages, it must be shown that the
dismissal of the employee was attended to by bad faith, or constituted
an act oppressive to labor, or was done in a manner contrary to morals,
good customs or public policy. The Labor Arbiter ruled that there was
ULP:
The complainants pointed out that the approval of the employees’

application for retirement was not done in succession
according to the list, but according to the choice of NEECO, and
for which, complainants were singled out from the list
because they were union officers, past officers and active
members of the complainant Association."
Unfair Labor Practices violate the constitutional rights of workers

and employees to self-organization, are inimical to the legitimate
interests of both labor and management, including their right to bargain
collectively and otherwise deal with each other in an atmosphere of
freedom and mutual respect; and disrupt industrial peace and hinder the
promotion of healthy and stable labor-management relations.
For this reason, we find it proper in this case to impose moral and
exemplary damages on NEECO. H
owever, the damages awarded by the LA are excessive. We are

cognizant that a cooperative promotes the welfare of its own members.
The economic benefits filter to the cooperative members. Either equally
or proportionally, they are distributed among members in correlation with
the resources of the association utilized. Under these circumstances, we
deem it proper to reduce moral damages to only P10,000.00 payable
by NEECO I to each individual petitioner. We also deem it sufficient for
private respondent NEECO I to pay each individual petitioner P5,000.00
to answer for exemplary damages, based on the provisions of Articles
2229 and 2232 of the Civil Code.
[Other issue] YES, but there was substantial compliance

W/N the appeal of NEECO
was filed late for not filing Indisputable is the legal doctrine that the appeal of a decision involving
the necessary supersedeas a monetary award in labor cases may be perfected "only upon the
posting of a cash or surety bond” pursuant to Art. 223 of the Labor Code.
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bond within the time

prescribed by law? Also, the perfection of an appeal within the reglementary period and in
the manner prescribed by law is jurisdictional, and noncompliance with
such legal requirement is fatal and effectively renders the judgment
final and executory.
However, in a number of cases. this Court relaxed the rule to resolve

controversies on the merits, specifically, when there are special
meritorious circumstances and issues.
In the case before us, the decision of the LA was issued on December
21, 1992. NEECO filed their appeal on December 28, 1992, barely 7 days
from receipt thereof. The bonding company issued the bond dated Jan
4, 1993, the last day for filing an appeal. However, it was forwarded to
NLRC only on the following day, Jan 5, 1993. Considering these
circumstances and the holiday season, we find it equitable to ease the
rules and consider that there was substantial compliance with the
requirements of the law.
What are they entitled to?
Having been illegally dismissed, individual petitioners are entitled to
reinstatement from the time they were illegally dismissed, until they were
reinstated. For that period they are likewise entitled to backwages minus
the amount they were forced to receive as "retirement" pay. In the event
that the amount of "retirement" pay received by an individual petitioner
exceeds the amount of his backwages, then the excess should be
deemed as advances of salary which should be refundable until fully
repaid by him.
RULING
WHEREFORE, the petition is PARTIALLY GRANTED. The assailed decision of the NLRC is
AFFIRMED with MODIFICATION. Private respondent Nueva Ecija 1 Electric Cooperative is hereby
ORDERED through its executive officers:
1. to pay individual petitioners their full backwages from the time they were illegally dismissed until the
date of their reinstatement on March 13, 1992, minus the amount they received as "retirement" pay. In
the event that the computed backwages of a concerned petitioner is less than the amount of so-called
"retirement" pay already received, the difference should be treated as advances refundable from his
salary until fully repaid;
2. to pay moral and exemplary damages in the amount of ten thousand (P10,000.00) pesos and five
thousand (P5,000.00) pesos, respectively, to each of the petitioners who were illegally terminated
and/or compulsorily retired;
3. to pay ten (10%) of the total amount due to petitioners as attorneys fees; and
4. to pay the cost of suits.

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Respondent NLRC is ORDERED to RECOMPUTE the total monetary benefits awarded and due to the
employees concerned in accordance with the decision and to submit its compliance thereon within thirty
(30) days from notice of this decision, with copies furnished to the parties.

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University of the Philippines College of Law

Topic Right to Self-Organization

ISSUE AND RATIO DECIDENDI

The complainants pointed out that the approval of the employees’

Unfair Labor Practices violate the constitutional rights of workers

owever, the damages awarded by the LA are excessive. We are

[Other issue] YES, but there was substantial compliance

bond within the time

However, in a number of cases. this Court relaxed the rule to resolve

4. to pay the cost of suits.

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