Abella vs NLRC

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Abella v NLRC
GR No. 71818
July 20, 1987

Facts:

Ricardo Dionele, Sr. (private respondent) has been a regular farm worker since 1949 in Hacienda Danao-Ramona located in Ponteverde, Negros Occidential. Said farm land was leased to Rosalina Abella (petitioner) for a period of ten (10) years, renewable for another ten years.

Upon the expiration of her leasehold rights, petitioner dismissed Ricardo and another co-employee.

Private respondents filed a complaint against the petitioner at the Ministry of Labor and Employment for overtime pay, illegal dismissal and reinstatement with backwages. After presenting their respective evidence, the Labor Arbiter ruled that the dismissal is warranted by the cessation of business, but granted the private respondents’ separation pay.

Petitioner filed a motion for reconsideration but the same was denied. Hence, the present petition.

Issue:

Whether or not private respondents are entitled to separation pay?

Held:

The petition is devoid of merit.

Article 284 of the Labor Code is the law applicable in this case.

“Art.284. 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 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 month pay or to at least one 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 month pay or at least one-half month pay for every year of service whichever is higher. A fraction of at least six months shall be considered one whole year."

The purpose of the said article is obvious: the protection of the workers whose employment is terminated because of the closure of establishment and reduction of personnel. Without said law, employees like private respondents in the case at bar will lose the benefits to which they are entitled for the number of years served. Although they were absorbed by the new management of the hacienda, in the absence of any showing that the latter has assumed the responsibilities of the former employer, they will be considered as new employees and the years of service behind them would amount to nothing.

In any event, it is well-settled that in the implementation and interpretation of the provisions of the Labor Code and its implementing regulations, the workingman’s welfare should be the primordial and paramount consideration.

The instant petition is hereby dismissed and the decision of the Labor Arbiter and the Resolution of the Ministry of Labor and Employment are hereby affirmed.

Acknowledgement: Flor Bonador