manlimos v nlrc
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Manlimos v NLRCTRANSCRIPT
7/21/2019 Manlimos v NLRC
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Manlimos v. NLRC
Facts The petitioners were among the regular employees of the Super
Mahogany Plywood Corporation hired as patchers taper!graders and
receivers dryers. "n # Septem$er #%%# a new owner&management
group headed $y 'lfredo Ro(as ac)uired complete ownership of the
corporation. The petitioners were advised of such change of ownership*
however the petitioners continued to wor+ for the new owner and were
considered terminated with their conformity. ,ach of them then
e(ecuted on #- ecem$er #%%# a Release and /aiver which they
ac+nowledged $efore 'tty. Nolasco iscipulo 0earing "1cer of the
2utuan City istrict "1ce of the epartment of La$or and ,mployment
3"L,4.
The new owner caused the pu$lication of a notice for the hiring ofwor+ers indicating therein who of the separated employees could $e
accepted on pro$ationary $asis. The petitioners then 5led their
applications for employment.
For their alleged a$sence without leave Perla Cumpay and 6irginia ,tic
were considered as of 7 May #%%8 to have a$andoned their wor+. The
rest were dismissed on #9 :une #%%8 $ecause they allegedly committed
acts pre;udicial to the interest of the new management which consisted
of their <including unrepaired veneers in their reported productions on
output as well as untapped corestoc+ or whole sheets in their supposedtaped veneers&corestoc+.< Two cases were 5led $y the dismissed
employees for non!payment of wages underpayment of wages
incentive leave pay non!payment of holiday pay overtime pay #9th
month pay separation pay reinstatement with $ac+wages illegal
termination and damages.
The petitioners maintained that they remained regular employees
regardless of the change of management in Septem$er #%%# and their
e(ecution of the Release and /aiver. They argue that $eing a
corporation the private respondent=s ;uridical personality was
una>ected even if ownership of its shares of stoc+ changed hands and)uit claims e(ecuted $y la$orers are frowned upon for $eing contrary to
pu$lic policy.
"n the other hand the private respondent contended that the
petitioners were deemed legally terminated from their previous
employment as evidenced $y the e(ecution of the Release and /aiver
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and the 5ling of their applications for employment with the new owner*
that the new owner was well within its legal right or prerogative in
considering as terminated the petitioners= pro$ationary&temporary
appointment.
L' ruled in favor of the petitioner ?t is the thesis of the La$or 'r$iterthat the transfer of ownership partoo+ of a cessation of $usiness
operation not due to $usiness reverses under 'rticle 8@9 of the La$or
Code and pursuant to the doctrine laid down in Mo$il ,mployees
'ssociation vs. National La$or Relations Commission. The La$or 'r$iter
ruled that the 5rst and third re)uisites were present in this case* she
e(plicitly held that each of the petitioners signed freely and voluntarily
the Release and /aiver and that the termination and payment of
separation pay $y the previous owner of the corporation were done in
good faith. The La$or 'r$iter however ruled that there was no
<cessation of operations which would lead to the dismissal of the
employees.<
NLRC reversed the ;udgment of the La$or 'r$iter. ?t found that the
change of ownership in this case was made in good faith since there
was no evidence on record that <the former owners conspired with the
new owners to insulate the former management of any lia$ility to its
wor+ers.< Citing Central 'Aucarera del anao Bsale or disposition of a
$usiness enterprise which has $een motivated $y good faith is <an
element of e(emption from lia$ility.< Thus <an innocent transferee of a
$usiness has no lia$ility to the employees of the transferor to continue
employing them. Nor is the transferee lia$le for past unfair la$orpractices of the previous owner e(cept when the lia$ility is assumed
$y the new employer under the contract of sale or when lia$ility arises
$ecause the new owners participated in thwarting or defeating the
rights of the employees.D?ssue /hether the employees were validly dismissed.Ruling The change in ownership of the management was done $ona 5de and
the petitioners did not for any moment $efore the 5ling of their
complaints raise any dou$t on the motive for the change. "n the
contrary upon $eing informed thereof and of their eventual termination
from employment they freely and voluntarily accepted their separationpay and other $ene5ts and individually e(ecuted the Release or /aiver
which they ac+nowledged $efore no less than a hearing o1cer of the
"L,.
/here such transfer of ownership is in good faith the transferee is
under no legal duty to a$sor$ the transferor=s employees as there is no
law compelling such a$sorption.
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Since the petitioners were e>ectively separated from wor+ due to a
$ona 5de change of ownership and they were accordingly paid their
separation pay which they freely and voluntarily accepted the private
respondent corporation was under no o$ligation to employ them* it
may however give them preference in the hiring. The hiring ofemployees on a pro$ationary $asis is an e(clusive management
prerogative. The employer has the right or privilege to choose who will
$e hired and who will $e denied employment.
?t is settled that while pro$ationary employees do not en;oy permanent
status they are accorded the constitutional protection of security of
tenure. They may only $e terminated for ;ust cause or when they fail to
)ualify as regular employees in accordance with reasona$le standards
made +nown to them $y the employer at the time of their engagement.
This constitutional protection however ends upon the e(piration of the
period provided for in their pro$ationary contract of employment.
Thereafter the parties are free to renew the contract or not.
' di>erent conclusion would have to $e reached with respect to Perla
Cumpay and 6irginia ,tic who were dismissed for having allegedly
a$andoned their wor+. ?n this case the private respondent not only
failed to prove such intent it as well violated the due process rule in
dismissal of employees. These re)uirements not having $een met with
respect to Cumpay and ,tic their dismissal was conse)uently illegal.ispositio
n
Partly Eranted. "nly petitioners Perla Cumpay and 6irginia ,tic were
entitled to reinstatement and $ac+wages.