Immediate Execution of Reinstatement Order by Labor Arbiter.
The decision of the Labor Arbiter reinstating a dismissed or separated employee, insofar as the reinstatement aspect is concerned, is immediately executory, even pending appeal. It means that the employee should be reinstated immediately, and not be made to wait until the outcome of the appeal. The basis for this is found in paragraph 3 of Article 223, of the Labor Code of the Philippines, as follows:
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“In any event, the decision of the Labor Arbiter reinstating a dismissed or separated employee, insofar as the reinstatement aspect is concerned, shall immediately be executory, even pending appeal. The employee shall either be admitted back to work under the same terms and conditions prevailing prior to his dismissal or separation or, at the option of the employer, merely reinstated in the payroll. The posting of a bond by the employer shall not stay the execution for reinstatement provided herein.”
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Policy of the Law.
In authorizing execution pending appeal of the reinstatement aspect of a decision of the Labor Arbiter reinstating a dismissed or separated employee, the law itself has laid down a compassionate policy which, once more, vivifies and enhances the provisions of the 1987 Constitution on labor and the working man. (Aris [Phil.] Inc. vs. NLRC, G.R. No. 90501 August 5, 1991.)
These duties and responsibilities of the State are imposed not so much to express sympathy for the workingman as to forcefully and meaningfully underscore labor as a primary social and economic force, which the Constitution also expressly affirms with equal intensity. Labor is an indispensable partner for the nation’s progress and stability. (Ibid.)
Duty to Implement Reinstatement is Ministerial.
The appeal made by the employer on the finding of illegal dismissal will not, by itself, stall the execution of the order of reinstatement. In order to stall execution, the remedy of the employer is to apply for restraining order upon filing of the appeal before the National Labor Relations Commission.
Unless there is a restraining order issued, it is ministerial upon the Labor Arbiter to implement the order of reinstatement. (Roquero vs. PAL, 2003)
Effect of Refusal of Employer to Reinstate Employee.
The order of reinstatement is immediately executory. The unjustified refusal of the employer to reinstate a dismissed employee entitles him to payment of his salaries effective from the time the employer failed to reinstate him despite the issuance of a writ of execution.
Option of Payroll Reinstatement.
Instead of physically reinstating the illegally dismissed employee to his former position, the employer has the option to merely reinstate him in the payroll (Article 223, Labor Code).
This is called payroll reinstatement. (Read Payroll Reinstatement.)
Effect of Reversal on Appeal.
Even if the order of reinstatement of the Labor Arbiter is reversed on appeal, it is obligatory on the part of the employer to reinstate and pay the wages of the dismissed employee during the period of appeal until reversal by the higher court.
On the other hand, if the employee has been reinstated during the appeal period and such reinstatement order is reversed with finality, the employee is not required to reimburse whatever salary he received for he is entitled to such, more so if he actually rendered services during the period.
The Refund Doctrine (Genuino case).
In case of reversal of the award of reinstatement on appeal, the employee is not required to reimburse the salary he received even if he did not render services during the period. This has been the consistent ruling in majority of cases.
A divergent view is found in Genuino vs. NLRC, G.R. Nos. 142732-33, December 4, 2007, where the Court held as follows:
“If the decision of the labor arbiter is later reversed on appeal upon the finding that the ground for dismissal is valid, then the employer has the right to require the dismissed employee on payroll reinstatement to refund the salaries s/he received while the case was pending appeal, or it can be deducted from the accrued benefits that the dismissed employee was entitled to receive from his/her employer under existing laws, collective bargaining agreement provisions, and company practices. However, if the employee was reinstated to work during the pendency of the appeal, then the employee is entitled to the compensation received for actual services rendered without need of refund.”
Genuino doctrine, however, found no support in subsequent cases. In Garcia vs. PAL case, G.R. No. 164856, January 20, 2009, the Court exposed the dearth of Genuino doctrine and downplayed it as a mere stray posture.
Need for Writ of Execution.
Given that the order of reinstatement is immediately executory, will there still be a need for a writ of execution to implement the order of reinstatement?
This question was answered in Pioneer Texturing vs. NLRC, 1997, where the Court held that the award of reinstatement is self-executory, even pending appeal. There is no more need for a writ of execution. To require the application for the issuance of a writ of execution would defeat the immediate execution of a reinstatement order as required by Article 223.
Note, however, that this view is not found in the Labor Code itself. The code only provides that reinstatement shall be immediately executory, but not self-executory (which obviously are two different things).
The rationale for dispensing the need for writ of execution was explicated by the Supreme Court in Pioneer case (ibid.), as follows:
“[…] The provision of Article 223 is clear that an award for reinstatement shall be immediately executory even pending appeal and the posting of a bond by the employer shall not stay the execution for reinstatement. The legislative content is quite obvious, i.e., to make an award of reinstatement immediately enforceable, even pending appeal. To require the application for and issuance of a writ of execution as prerequisites for the execution of a reinstatement award would certainly betray and run counter to the very object and intent of Article 223, i.e., the immediate execution of a reinstatement order. The reason is simple. An application for a writ of execution and its issuance could be delayed for numerous reasons. A mere continuance or postponement of a scheduled hearing, for instance, or an inaction on the part of the Labor Arbiter or the NLRC could easily delay the issuance of the writ thereby setting at naught the strict mandate and noble purpose envisioned by Article 223. In other words, if the requirements of Article 224 were to govern, as we so declared in Maranaw, then the executory nature of a reinstatement order or award contemplated by Article 223 will be unduly circumscribed and rendered ineffectual[…]
Last Edited: Sunday, March 20, 2011