Azcor v. NLRC

AZCOR MANUFACTURING INC, FILIPINAS PASO, and/or ARTURO ZULUAGA/Owner v. NATIONAL LABOR RELATIONS COMISSION AND CANDIDO CAPULSO February 11, 1999 | Padilla, J. | Termination of Employment Digester: Bea, Alexis SUMMARY: Candido filed with the LA a complaint for constructive illegal dismissal. He alleged that he worked for Azcor for more than 2 years. Then, due to asthma, he filed for a leave of absence. Upon returning to work, he was not permitted to do so. He later on amended his complaint and impleaded Filipinas Paso as additional respondent. Azcor, meanwhile, contends that he validly resigned from the company to seek employment from Filipinas Paso where he also resigned. LA dismissed the case. NLRC reversed. SC held that Candido was illegally dismissed and that his letter of resignation was obviously spurious because it was worded exactly and it was English despite of the fact that Candido was uneducated and cannot speak English.

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DOCTRINE: The doctrine that a corporation is a legal entity or a person in law distinct from the persons composing it is merely a legal fiction for purposes of convenience and to subserve the ends of justice. Where, as in this case, the corporate fiction was used as a means to perpetrate a social injustice or as a vehicle to evade obligations or confuse legitimate issues, it would be discarded and the 2 corporations would be merged as one.

FACTS:  Candido (Candie?) Capulso filed with the LA a complaint for constructive illegal dismissal and illegal deduction of P50.00 a day for the period of April to September 1989. Azcor and Arturo (who were the respondents before the LA case and Filipina was not a party in the case yet) moved to dismiss the complaint on the ground that there was no ER-EE relationship between petitioners and Capulso o Candido became an employee of Filipinas from March 1, 1990 but voluntarily resigned a year after  LA Felipe Garduque II denied the motion to dismiss holding that the allegation of lack of ER-EE relationship was not clearly established o Candido’s evidence: showed that he worked for Azcor as ceramics worker for more than 2 years starting from April 1989 to June 1991 receiving a daily wage of

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P118.00 plus other benefits such as vacation and sick leaves. From april to September, the amount of P50.00 was deducted from his salary without informing him the reason Upon the recommendation of his doctors Candido verbally requested to go on sick leave due to bronchial asthma. o His illness was proven to be directly caused by his job as a ceramics worker o This was due to the lack of the prescribed occupational safety gadgets; thus, he inhaled and absorbed harmful ceramic dusts His supervisor approved his request Four months later, Candido went back to Azcor to resume his work after recuperating. He was not allowed to do so by his supervisors and informed him that only the owner, Arturo, could allow him to continue his job. He returned five times to Azcor but when it became apparent that he would not be reinstated, he immediately filed the complaint for illegal dismissal o Evidence in support of this claim:  Affidavit and testimony to prove that he was terminated without due process and just cause  Identification card issued by Azcor which he continued to use even after his supposed employment by Filipinas  Certification of SSS premium payments  SSS Member Assistance Form wherein he stated that he worked with Azcor from March 1989 to 1991  Certification of Employee Contribution with SSS  Payslips issued by Azcor Petitioners allege that Candido was a former employee of Azcor who resigned on February 28, 1990 as evidenced by a letter of resignation and joined Filipinas on March 1990 as shown by a contract of employment Candido allegedly informed his supervisor that he intended to go on terminal leave because he was not feeling well On March 1, 1991, he submitted a letter of resignation addressed to the President of Filipinas Paso, Manuel Montilla, o In the early part of June 1991 Capulso tried to apply for work again with Filipinas Paso but there was no vacancy o Petitioners submitted the ff. evidence:

Sworn statement of Candido’s supervisor and her actual testimony to prove that respondent actually resigned from Azcor to Filipinas Paso (and thereafter from Filipinas Paso due to failing health)  Contract of Employment between Filipinas Paso and Candido  Letter of resignation of Candido (both to Filipinas Paso and Azcor)  Individual income tax return of Candido  BIR Form which was an alphabetical list of employees of Filipinas Paso for the year of 1990 LA dismissed the complaint for lack of merit but ordered Azcor to refund to Candido the amount illegally deducted from his salary NLRC modified the decision by declaring the dismissal of Candido as illegal for lack of just and valid cause and ordered to reinstate Candido The contract of employment with Candido and Filipinas Paso stated that theperiod is for 6 months which establishes a presumption that the said contract could pass either as to cover the probationary period, or job contracting—the completion of which automatically terminates the employment o However, Candido continued working for Filipinas Paso after the lapse of the contract until the alleged termination of employment of the appellant o The two resignation letters executed by the appellant are EXACTLY WORDED—shows that the same were prepared by one person plus, Candido denied having executed the same o These clearly show that there was no interruption in the service of the complainant with Azcor from April 1989 to June 1991 when Candido was unceremoniously dismissed Azcor and Filipinas Paso orchestrated the events that appeared, showing bad faith of the respondents in the treatment of their employees MR was granted by the NLRC. Meanwhile, during the pendency of the case before the SC Candido succumbed to asthma and heart disease Azcor Manufacturing Inc, Filipinas Paso, and Arturo Zuluaga instituted this petition for certiorari to assail the decision of the NLRC which reversed the decision of the LA dismissing the complaint of respondent Candido Capulso against petitioners 

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RULING: Petition DISMISSED. Since Candido died during the pendency, backwages from the time of illegal dismissal to the time of his death. Whether or not Candido was illegally dismissed—YES  Azcor and Filpinas Paso insist that Candido was not really dismissed but he voluntarily resigned and there was nothing illegal or unusual in the letters of resignation he executed  The court disagrees. To constitute a resignation, it must be unconditional and with the intent to operate as such. There must be an intention to relinquish a portion of the term of office accompanied by an act of relinquishment  In the instant case, the fact that Candido indicated his intent to return to his work when he went back to Azcor after recuperating and actively pursued this case for illegal dismissal when he was refused admission, negated any intention on his part to relinquish his job at Azcor  A closer look at the subject resignation letters reveal that they were indentically worded for both companies; both were pre drafted with blank spaces filled up with the purported dates of effectivity of his resignation; and it was written in English, a language which Candido was not conversant with considering his low level of education  This shows that the letters were prepared by the same person or persons other than Candido o He also categorically disowned the signatures therein and denied having executed themindication that resignation letters were drafted without his consent and participation  For the sake of argument, even if the signatures were genuine, the court cannot give credence to those letters in the absence of any showing that Candido was aware that he was signing then, were in fact resignation letters or that he fully understood the contents thereof o It was incumbent upon Azcor and Filipinas Paso to prove clearly and convincingly their genuineness and due execution, especially considering the serious doubts on their authenticity. They failed miserably in this respect. Whether or not Candido’s repudiation of the signatures was weakened by the fact that he filed the case after four months from the date of the dismissal—NO

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In an action for reinstatement by reason of illegal dismissal is one based on an injury may be brought within 4 years from the time of dismissal pursuant to Article 1146 of the NCC o Candido’s case which was filed after a measly delay of four months should not be treated with skepticism or cynicism. o By law and settled jurisprudence, he has four years to file his complaint for illegal dismissal o A delay of four months is more than sufficient compliance with the prescriptive period It may betray an unlettered man’s lack of awareness of his rights as a lowly worker, but certainly he must not be penalized for his tarrying

Whether or not petitioners (Azcor and Filipinas Paso) could not be held jointly and severally liable to Candido for backwages since they are separate and distinct corporations with different corporate personalities—NO  Court is not persuaded by that argument.  The doctrine that a corporation is a legal entity or a person in law distinct from the persons composing it is a legal fiction for purposes of convenience and to subserve the ends of justice

This fiction cannot be extended to a point beyond its reason and policy o Where, as in this case, corporate fiction was used as a means to perpetrate a social injustice, it would be discarded and the two corporations would be merged as one, the first being merely considered as the instrumentality, agency, or adjunct of the other In the case at bar, there was much confusion as to the identity of Candido’s employer, but for sure it was Filipinas Paso and Azcor’s own design. First, Candido had no knowledge that he was already working under Filipinas Paso since he continued to retain his Azcor ID. Second, his pay slips contained the name of Azcor giving the impression that the latter was paying his salary. Third, he was paid the same salary and performed the same job, in the same work area, in the same location, using the same tools, and under the same supervisor. In fine, we see in the totality of the evidence show a veiled attempt by petitioners to deprive Candido of what he had earned through hard labor by taking advantage of his low level education and confusing him as to who really was his employer —a callous and despicable treatment of a worker who had rendered faithful service to their company o

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