Banares v. TAWTRASCO G.R. No.

197353 1 of 11

Republic of the Philippines

SUPREME COURT
Baguio City
THIRD DIVISION
G.R. No. 197353 April 1, 2013
ALEXANDER B. BANARES, Petitioner,
vs.
TABACO WOMEN'S TRANSPORT SERVICE COOPERATIVE (T A WTRASCO), represented by DIR.
RENOL BARCEBAL, ET AL., Respondents.
DECISION
VELASCO, JR., J.:
In this Petition for Review on Certiorari under Rule 45, Alexander B. Baares assails and seeks the reversal of the
Decision dated October 14, 2010 of the Court of Appeals (CA) in CA-G.R. SP No. 112542 and its Resolution of
June 15, 2011 denying petitioner's motion for reconsideration. The CA Decision set aside the July 7, 2009 Decision
and November 18, 2009 Resolution of the National Labor Relations Commission (NLRC) as well as the April 14,
2008 Order of the Labor Arbiter.
The facts are undisputed.
Petitioner was for some time the general manager of Tabaco Women's Transport Service Cooperative (T A
WTRASCO) until its management, on March 6, 2006, terminated his services. On March 7, 2006, before the Labor
Arbiter (LA) in RAB V of the NLRC in Legaspi City, petitioner filed a complaint for illegal dismissal and payment
of monetary claims which was docketed as NLRC RAB V Case No. 03-00092-06.
On August 22, 2006, the LA rendered a Decision finding for petitioner, as complainant, with the fallo reading:
WHEREFORE, premises considered, judgment is hereby rendered declaring complainant to have been illegally
dismissed from his employment. Consequently, respondent Tabaco Womens Transport Service Cooperative
(TAWTRASCO) is hereby ordered to immediately reinstate complainant to his former position, without loss of
seniority right and to pay complainant the total amount of ONE HUNDRED NINETEEN THOUSAND SIX
HUNDRED PESOS (P119,600.00), representing the latters backwages and damages, as computed above.
All other claims and/or charges are hereby dismissed for lack of factual and legal basis.
SO ORDERED.
Since TAWTRASCO opted not to appeal, the LA Decision soon became final and executory. In fact,
TAWTRASCO in no time paid petitioner the amount of PhP 119, 600 by way of damages and backwages
corresponding to the period March 6, 2006 to August 22, 2006. But petitioner was not immediately reinstated.
Owing to the strained employer-employee relationship perceived to exist between them, TAWTRASCO offered to
pay petitioner separation pay of PhP 172, 296, but petitioner rejected the offer. Eventually, the two entered into a
Compromise Agreement, in which petitioner waived a portion of his monetary claim, specifically his backwages
for the period from August 23, 2006 to February 5, 2007, and agreed that the amount due shall be payable in three
(3) installments. In turn, TAWTRASCO undertook to reinstate the petitioner effective February 6, 2007.
Banares v. TAWTRASCO G.R. No. 197353 2 of 11

Accordingly, the LA issued, on February 5, 2007, an Order based on the compromise agreement thus executed, and
declared the instant case closed and terminated.
On February 24, 2007, petitioner received a copy of Memorandum Order No. 04, Series of 2007, with a copy of a
resolution passed by the Board of Directors (BOD) of TAWTRASCO, requiring him to report at the companys
Virac, Catanduanes terminal. The memorandum order contained an enumeration of petitioners duties and
responsibilities.
A day after, petitioner went to see Oliva Barcebal (Oliva), the BOD Chairman, to decry that the adverted return-to-
work memorandum and board resolution contravene the NLRC-approved compromise agreement which called for
his reinstatement as general manager without loss of seniority rights. Petitioner would later reiterate his concerns in
a letter dated March 12, 2007.
On March 20, 2007, TAWTRASCO served petitioner a copy of Memorandum No. 10, Series of 2007 which set
forth his location assignment, as follows: temporarily assigned at the Virac, Catanduanes terminal/office for two
months, after which he is to divide his time between the Virac Terminal and the Araneta Center Bus Terminal
(ACBT), three days (Monday to Wednesday) in Virac and two days (Friday and Saturday) in Cubao, utilizing
Thursday as his travel day in between offices. As ordered, petitioner reported to the Virac terminal which
purportedly needed his attention due to its flagging operations and management problems.
Barely a week into his new assignment, petitioner, thru a memorandum report, proposed the
construction/rehabilitation of the passenger lounge in the Virac terminal, among other improvements. The proposal
came with a request for a monthly lodging accommodation allowance of PhP 1,700 for the duration of his stay in
Virac.
While the management eventually approved the desired construction projects, it denied petitioners plea for cash
lodging allowance. Instead of a straight cash allowance, the company urged petitioner to use the Virac office for
lodging purposes.
Subsequent events saw petitioner requesting and receiving an allocation of PhP 3,000 for his travel,
accommodation, representation and communication allowance subject to liquidation. No replenishment, however,
came after.
On April 12, 2007, Oliva, while conducting, in the company of another director, an ocular inspection of the Virac
terminal, discovered that petitioner had not reported for work since March 31, 2007. Thus, the issuance of a
company memorandum asking petitioner to explain his absence.
In response, petitioner addressed a letter-reply to management stating the underlying reason for not reporting and
continue reporting for work in his new place of assignment and expressing in detail his grievances against
management. Some excerpts of petitioners letter:
x x x The very reason why I dont go back to Virac Catanduanes x x x is because I realized that in truth my
reinstatement effected by your office which is supposed to be in pursuance to the NLRC decision is nothing but an
artificial, fake, fictitious and a sham kind of return to work order.
I regret to say it so on the following grounds:
1. Our garage/terminal in Virac Catanduanes wherein you would want me to stay is in total disarray and dirty as it
looks until the time that I stayed there and despite having reported that matter to you and despite having requested
Banares v. TAWTRASCO G.R. No. 197353 3 of 11

by me that the necessary funding for the reconstruction or rebuilding of the necessary facilities we at least used to
have before should be immediately allocated and released and yet you were too slow in granting it;
2. Despite x x x my request for the allocation of the indispensable travel, representation and accommodation
allowances I need to have while staying in Virac because the garage/terminal facilities remains in a messy
condition but still you fail until now to provide it to me x x x;
3. The manner and nature of work you would want me to do while in Virac is utterly a deviation from my original
work and in effect a demotion in rank;
4. The place of work x x x was completely devoid of any office materials and equipments needed in the nature of
my work. To put in details there was no office table and chairs, no filing cabinets for safekeeping of important
documents, no ball-pens, no bond papers etc. x x x There is nothing at all in said place of work for me to say that
there was really an office of the General Manager. As a matter of fact, you know that all my reports being
submitted x x x are made possible by using my own personal computer, my computer printer, my computer inks
and even my own bond papers.
5. Just recently, I found out that there are employees in our company who are under my jurisdiction and x x x that
are being instructed not to follow my lawful orders. This matter needs no further explanation because I have
already reported it and yet you did nothing to correct it.
6. The free place of accommodation I used to have before when staying in Cubao, Quezon City remains non-
existent x x x despite the fact that x x x I need to be [back] also in Cubao to facilitate the restoration of our
transport operation x x x.
In essence, there is an ongoing mockery of the mandate of the NLRC decision that I should be reinstated to my
former position as General Manager without loss of seniority rights. What is truly happening now is the obvious
evidence that you dont want me to work the way I was doing it before and the way as mandated by the by-laws of
our transport cooperative.
In sum, you cannot charge me for abandonment of work because you are in fact causing me an inhumane and
degrading treatment as General Manager and giving an embarrassing kind of work.
Therefore, in view of the foregoing circumstances, may I hereby demand that my salary should be paid
immediately as soon as you receive this letter of mine that explains in full details the logical reasons why I really
cannot go back to my new place of assigned but temporary work x x x.
xxxx
Finally, let me just frankly tell you that I can only go back to Virac Catanduanes when everything I need in my
work as General Manager is sufficiently given to me and when all employees of TAWTRASCO are duly advised
that in effect Im truly back to work and all the employees need to follow my orders. Meantime, as General
Manager I will utilize my time to do some other works x x x.
On April 27, 2007, petitioner filed a complaint against TAWTRASCO for nonpayment of salaries and withholding
of privileges before the LA. Via a Manifestation with application for the issuance of an alias writ of execution,
petitioner prayed that his complaint be deemed withdrawn "for the purpose of not confusing the essence of
consolidation and in order to give way to the smooth proceedings and fast adjudication on the merits."
Banares v. TAWTRASCO G.R. No. 197353 4 of 11

By Order of April 14, 2008, the LA effectively issued the desired alias writ of execution, as follows:
Consequently, there being no compliance of the reinstatement aspect of the Decision, petitioner is therefore,
entitled to his reinstatement salaries less the amount he already received, reckoned from date of receipt by
respondent [TAWTRASCO] of the decision on October 11, 2006 to date of this order, subject to further
computation until reinstatement is actually carried out religiously plus monthly allowance of P1,000.00 without
prejudice on the part of the respondent to avail of the remedy available to it under the rules. Hence, the same is
computed as follows:
October 11, 2006 to April 18, 2008 = 18 mos.
Basic + Allowance P19,000.00 x 18 mos. = P342,000.00
LESS:
BPI Check: 2/11/07 P18,000.00
BPI Check: 2/12/07 18,000.00
BPI Check: 3/6/07 18,000.00
BPI Check: 4/6/07 18,000.00
CY 2/13/08 7,500.00
2/27/08 7,500.00 87,000.00
P255,000.00
xxxx
Responsive to all the foregoing, respondent [TAWTRASCO] is hereby ordered to reinstate complainant to his
former position as General Manager, without loss of seniority right and pay petitioner the amount of P255,000.00,
representing the latters reinstatement salaries (after deducting the amount he already received) and monthly
allowance, as computed above.
Respondent is also ordered to show proof of compliance of complainants reinstatement immediately upon receipt
hereof.
SO ORDERED.
TAWTRASCO appealed to the NLRC which dismissed the appeal per its Decision dated July 7, 2009, the
dispositive portion of which reads:
WHEREFORE, judgment is hereby rendered DISMISSING respondents appeal for lack of merit. The assailed
Order of the Labor Arbiter dated 14 April 2008, is hereby AFFIRMED.
SO ORDERED.
In so ruling, the NLRC held that TAWTRASCO only partially complied with the final and executory August 22,
2006 Decision of the LA, i.e., by paying the PhP 119,000 backwages of petitioner as ordered. The reinstatement
aspect of the LA Decision, however, has yet to be wholly complied with. To the NLRC, the LA acted within his
sound discretion in ordering the authentic and full reinstatement of petitioner and the payment of PhP 255,000 as
Banares v. TAWTRASCO G.R. No. 197353 5 of 11

reinstatement salaries as computed from October 11, 2006 to April 18, 2008.
The NLRC denied, through its November 18, 2009 Resolution, TAWTRASCOs motion for reconsideration.
TAWTRASCO went to the CA on certiorari. On October 14, 2010, the appellate court rendered the assailed
Decision, the fallo of which reads:
WHEREFORE, the instant petition for certiorari is GRANTED. The assailed Decision and Resolution of the public
respondent National Labor Relations Commission, in NLRC LAC No. 08-002800-08 [NLRC RAB V Case No. 03-
000092-06], as well as the Order dated 14 April 2008 of the Labor Arbiter are SET ASIDE.
SO ORDERED.
Contrary to the LAs holding, as affirmed by the NLRC, the CA found TAWTRASCO to have fully reinstated
petitioner to his former post. And without expressly declaring so, the unmistakable thrust of the CA disposition was
that petitioner veritably abandoned his work when he stopped reporting to his Virac terminal assignment.
His motion for reconsideration having been denied per the CAs assailed Resolution of June 15, 2011, petitioner
went to this Court. His petition is predicated on the following assignment of errors:
(A)
THE [CA] SERIOUSLY ERRED AND GRAVELY ABUSED ITS DISCRETION IN FAILING TO OBSERVE
AND UPHOLD THE FORMAL AND PROCEDURAL REQUIREMENTS IN THE FILING OF THE PETITION
FOR CERTIORARI UNDER RULE 65.
(B)
THE [CA] SERIOUSLY ERRED AND GRAVELY ABUSED ITS DISCRETION IN IGNORING THE STRICT
RULE ON NON-FORUM SHOPPING AND WHEN DESPITE KNOWLEDGE OF A PRIOR FINAL
JUDGMENT INVOLVING THE SAME AND IDENTICAL ISSUES AND THE SAME AND IDENTICAL
PARTIES, THE COURT A QUO FAILED TO DISMISS OUTRIGHT THE PETITION FOR CERTIORARI IN
VIOLATION OF THE DOCTRINE ON "RES JUDICATA" AND THE PRINCIPLE OF "LITIS PENDENCIA".
(C)
THE [CA] SERIOUSLY ERRED AND GRAVELY ABUSED ITS DISCRETION WHEN THE COURT A QUO
HAS DECIDED IT IN A WAY NOT IN ACCORD WITH LAW OR WITH APPLICABLE DECISIONS OF THIS
SUPREME COURT WITH RESPECT TO THE FORMAL APPEARANCES OF COUNSEL.
(D)
THE [CA] SERIOUSLY ERRED AND GRAVELY ABUSED ITS DISCRETION WHEN THE COURT A QUO
HAS SO FAR DEPARTED FROM THE ACCEPTED AND USUAL COURSE OF JUDICIAL PROCEEDINGS
IN DELVING INTO THE FACTS OF THE CASE.
The petition is meritorious.
Essentially, the issues raised boil down to: was there a proper and genuine reinstatement of petitioner to his former
position of General Manager of TAWTRASCO without loss of seniority rights and privileges? Subsumed in this
core issue is the question of whether petitioners refusal to report in the Virac terminal in early April 2007
constitutes abandonment, not constructive dismissal.
Banares v. TAWTRASCO G.R. No. 197353 6 of 11

The parallel finding and conclusion of the LA and the NLRC contradict that of the CA which, as earlier indicated,
categorically resolved the first factual poser in the negative. In light of the divergence between the findings of facts
of the LA and the NLRC, on one hand, and the appellate court, on the other, a review of the records and the
clashing arguments of the parties is in order.
Reinstatement, as a labor law concept, means the admission of an employee back to work prevailing prior to his
dismissal; restoration to a state or position from which one had been removed or separated, which presupposes that
there shall be no demotion in rank and/or diminution of salary, benefits and other privileges; if the position
previously occupied no longer exists, the restoration shall be to a substantially equivalent position in terms of
salary, benefits and other privileges. Managements prerogative to transfer an employee from one office or station
to another within the business establishment, however, generally remains unaffected by a reinstatement order, as
long as there is no resulting demotion or diminution of salary and other benefits and/or the action is not motivated
by consideration less than fair or effected as a punishment or to get back at the reinstated employee.
Guided by the foregoing reasonable albeit exaction norm, the "reinstatement" of petitioner as general manager of
TAWTRASCO, effected by TAWTRASCO pursuant to the February 5, 2007 compromise agreement, was not a
real, bona fide reinstatement in the context of the Labor Code and pertinent decisional law. Consider:
First, TAWTRASCO at the outset, i.e., after the compromise agreement signing, directed petitioner to report to the
Virac terminal with duties and responsibilities not befitting a general manager of a transport company. In fine, the
assignment partook of the nature of a demotion. The aforementioned Memorandum Order No. 04, Series of 2007,
in its pertinently part, states and directs:
DUTIES AND RESPONSIBILITIES
1) To supervise all TAWTRASCO bus employees, personnels and including authorized callers for the success of
the terminal operation;
2) To have a record of the in and out of freight loaded on all TAWTRASCO buses, regulate freight charge/s and
minimize problems and complaints regarding the freight/cargoes loaded at these buses;
3) As General Manager to sign on the manifesto or trip records of the buses going out daily at Virac Terminal
attesting his approval except on day-off schedule;
4) To unite, settle differences or disputes between TAWTRASCO key personnels at TAWTRASCO Virac terminal
affecting its management operation particularly x x x;
5) To explore all possibilities and restore the said terminal to its former successful operation;
6) To find solution to all other problems relative to its management operation and to report complaints affecting
transport operations; and
7) To give a written report to the Board of Directors on your accomplishments.
ADDENDUM: On Day-off Schedule
1) Authorized Day-Off Once a week
2) To give Notice three (3) days before regarding vacation leave except on emergency cases.
APPROVED: TAWTRASCO BOARD OF DIRECTORS
Banares v. TAWTRASCO G.R. No. 197353 7 of 11

A cursory reading of items (2) and (3) above would readily reveal that petitioner was tasked to discharge menial
duties, such as maintaining a record of the "in" and "out" of freight loaded on all TAWTRASCO buses and signing
the trip records of the buses going out daily. To be sure, these tasks cannot be classified as pertaining to the office
of a general manager, but that of a checker. As may reasonably be expected, petitioner promptly reacted to this
assignment. A day after he received the memorandum in question, or on February 25, 2007, he repaired to the
office of Oliva to personally voice out his misgivings about the set up and why he believed that the above
memorandum contravened their compromise agreement and the February 5, 2007 Order of the LA specifically
providing for his reinstatement as general manager without loss of seniority rights and privileges.
Nevertheless, 15 days after the uneventful personal meeting with Oliva, petitioner addressed a letter to top
management inquiring about his reinstatement and assignment. The BOD Secretary of TAWTRASCO received this
letter on March 13, 2007.
TAWTRASCOs action on petitioners aforementioned letter came, as narrated earlier, in the form of Memorandum
No. 10, Series of 2007, which temporarily assigned him to the Virac terminal for two months. And after the two-
month period, he shall divide his time between the Virac and the ACBT terminals, with Thursday as his travel day
in between offices. Notably, this time, TAWTRASCO explained that its Virac terminal needs petitioners attention
due to its flagging operations and management problems. Thus, petitioner acquiesced and reported to the Virac
terminal of TAWTRASCO.
In a rather unusual turn of events, however, the assailed CA decision made no mention of the foregoing critical
facts despite their being pleaded by petitioner and duly supported by the records, although that court made a
perfunctory reference to the adverted Memorandum Order No. 04.
And second, while Memorandum No. 10 was couched as if TAWTRASCO had in mind the reinstatement of
petitioner to his former position, there cannot be any quibble that TAWTRASCO withheld petitioners customary
boarding house privilege. What is more, TAWTRASCO did not provide him with a formal office space.
As evidence on record abundantly shows, TAWTRASCO was made aware of its shortcomings as employer, but it
opted not to lift a finger to address petitioners reasonable requests for office space and free lodging while assigned
at the Virac terminal. Thus, the stand-off between employer and employee led to petitioner writing on April 24,
2007 to TAWTRASCO, an explanatory letter explaining his failure to report back to work at the Virac terminal. We
reproduce anew highlights of that letter:
I regret to say it so on the following grounds:
1. Our garage/terminal in Virac Catanduanes wherein you would want me to stay is in total disarray and dirty as it
looks until the time that I stayed there and despite having reported that matter to you and despite having requested
by me that the necessary funding for the reconstruction or rebuilding of the necessary facilities we at least used to
have before should be immediately allocated and released and yet you were too slow in granting it;
2. Despite x x x my request for the allocation of the indispensable travel, representation and accommodation
allowances I need to have while staying in Virac because the garage/terminal facilities remains in a messy
condition but still you fail until now to provide it to me because probably you want me to sleep at night along the
sidewalks x x x;
3. The manner and nature of work you would want me to do while in Virac is utterly a deviation from my original
work and in effect a demotion in rank;
Banares v. TAWTRASCO G.R. No. 197353 8 of 11

4. The place of work x x x was completely devoid of any office materials and equipments needed in the nature of
my work. To put in details there was no office table and chairs, no filing cabinets for safekeeping of important
documents, no ball-pens, no bond papers etc. x x x There is nothing at all in said place of work for me to say that
there was really an office of the General Manager.
As a matter of fact, you know that all my reports being submitted x x x are made possible by using my own
personal computer, my computer printer, my computer inks and even my own bond papers. x x x x
6. The free place of accommodation I used to have before when staying in Cubao, Quezon City remains non-
existent x x x despite the fact that x x x I need to be [back] also in Cubao to facilitate the restoration of our
transport operation x x x.
Apropos to what petitioner viewed as a demeaning treatment dealt him by TAWTRASCO, the LA had stated the
ensuing observations in his April 14, 2008 Order:
In this case, however, this Branch finds that respondent TAWTRASCO indeed, complied with the reinstatement of
the complainant petitioner Baares, however, the office where he was assigned in Virac, Catanduanes is not in
good and tenantable condition. As shown in complainants Annex "F" which is the photograph of the place, it is
unsafe, dilapidated and in a messy situation. Confronted with this problem, complainant requested fund from
respondent for the rehabilitation of the office. However, this was not favorably acted upon. To further rub salt in an
open wound, respondent appointed a new General Manager effective November 12, 2007 (Annexes "H" and "I",
complainants Memorandum). This conduct on the part of respondent gave complainant the correct impression that
the respondent did not intend to be bound by the compromise agreement, and its non-materialization negated the
very purpose for which it was executed.
Annex "F," the photograph adverted to by the LA, tells it all. Indeed, petitioner could not reasonably be expected to
work in such a messy condition without any office space, office furniture, equipment and supplies. And much less
can petitioner lodge there. TAWTRASCO pointedly told petitioner through the March 26, 2007 letter of Oliva
denying his request for a PhP 1,700 lodging allowance that petitioner could instead use the Virac office for his
accommodation. It must be borne in mindand TAWTRASCO has not controverted the factthat, prior to his
illegal dismissal, petitioner was enjoying PhP 5,000-a-month free lodging privilege while stationed in the Cubao
terminal. Accordingly, this lodging privilege was supposed to continue under the reinstatement package. But as it
turned out, TAWTRASCO discontinued the accommodation when it posted petitioner in Virac.
Under Article 223 of the Labor Code, an employee entitled to reinstatement "shall either be admitted back to work
under the same terms and conditions prevailing prior to his dismissal or separation x x x." Verily, an illegally
dismissed employee is entitled to reinstatement without loss of seniority rights and to other established
employment privileges, and to his full backwages. The boarding house privilege being an established perk
accorded to petitioner ought to have been granted him if a real and authentic reinstatement to his former position as
general manager is to be posited.
It cannot be stressed enough that TAWTRASCO withheld petitioners salaries for and after his purported refusal to
report for work at the Virac terminal. The reality, however, is that TAWTRASCO veritably directed petitioner to
work under terms and conditions prejudicial to him, the most hurtful cut being that he was required to work
without a decent office partly performing a checkers job. And this embarrassing work arrangement is what
doubtless triggered the refusal to work, which under the premises appears very much justified.
Banares v. TAWTRASCO G.R. No. 197353 9 of 11

Generally, employees have a demandable right over existing benefits voluntarily granted to them by their
employers. And if the grant or benefit is founded on an express policy or has, for a considerable period of time,
been given regularly and deliberately, then the grant ripens into a vested right which the employer cannot
unilaterally diminish, discontinue or eliminate without offending the declared constitutional policy on full
protection to labor. So it must be here with respect, at the minimum, to the lodging accommodation which
TAWTRASCO, as found by the NLRC, appears to have regularly extended for free for some time to petitioner.
Contrary to TAWTRASCOs posture and what the CA Decision implied, petitioners refusal, during the period
material, to report for work at the Virac terminal does not, without more, translate to abandonment. For
abandonment to exist, it is essential (1) that the employee must have failed to report for work or must have been
absent without valid or justifiable reason; and (2) that there must have been a clear intention to sever the employer-
employee relationship manifested by some overt acts. These concurring elements of abandonment are not present
in the instant case.
As reflected above, the reinstatement order has not been faithfully complied with. And varied but justifiable
reasons obtain which made petitioners work at the Virac terminal untenable. To reiterate, there was a lack of a
viable office: no proper office space, no office furniture and equipment, no office supplies. Petitioners request for
immediate remediation of the above unfortunate employment conditions fell on deaf ears. This is not to mention
petitioners board and lodging privilege which he was deprived of without so much as an explanation. Thus, it
could not be said that petitioners absence is without valid or justifiable cause.
But more to the point, petitioner has not manifested, by overt acts, a clear intention to sever his employment with
TAWTRASCO. In fact, after submitting his April 24, 2007 letter-explanation to, but not receiving a reaction one
way or another from, TAWTRASCO, petitioner lost no time in filing a complaint against the former for, inter alia,
nonpayment of salaries and forfeiture of boarding house privilege. Thereafter, via a Manifestation, he sought the
early issuance of an alias writ of execution purposely for the full implementation of the final and executory LA
August 22, 2006 Decision, i.e., for the payment of his salaries and full reinstatement. These twin actions clearly
argue against a finding of abandonment on petitioners part. It is a settled doctrine that the filing of an illegal
dismissal suit is inconsistent with the charge of abandonment, for an employee who takes steps to protest his
dismissal cannot by logic be said to have abandoned his work.
Given the convergence of events and circumstances above described, the Court can readily declare that
TAWTRASCO admitted petitioner back to work under terms and conditions adversely dissimilar to those
prevailing before his illegal dismissal. Put a bit differently, petitioner was admitted back, but required to work
under conditions crafted to cause unnecessary hardship to or meant to be rejected by him. And to reiterate, these
conditions entailed a demotion in rank and diminution of perks and standard privileges. The shabby and unfair
treatment accorded him or her by the management of TAWTRASCO is definitely not genuine reinstatement to his
former position.
The Court finds, as did the NLRC and the LA, that petitioner was not truly reinstated by TAWTRASCO consistent
with the final and executory August 22, 2006 Decision of the LA and the February 5, 2007 Compromise Agreement
inked by the parties in the presence of the hearing LA. Perforce, the assailed decision and resolution of the CA
must be set aside, and the April 14, 2008 Order of the LA, as effectively affirmed in the July 7, 2009 Decision and
November 18, 2009 Resolution of the NLRC, accordingly reinstated.
Supervening events, however, had transpired which inexorably makes the reinstatement infeasible. For one, on
Banares v. TAWTRASCO G.R. No. 197353 10 of 11

November 12, 2007, TAWTRASCO already appointed a new general manager. Petitioner no less has raised this
fact of appointment. As a matter of settled law, reinstatement and payment of backwages, as the normal
consequences of illegal dismissal, presuppose that the previous position from which the employee has been
removed is still in existence or there is an unfilled position of a nature, more or less, similar to the one previously
occupied by said employee.
For another, a considerable period of time has elapsed since petitioner last reported to work in early 2007 or
practically a six-year period. And this protracted labor suit have likely engendered animosity and exacerbated
already strained relations between petitioner and his employer.
Reinstatement is no longer viable where, among other things, the relations between the employer and employee
have been so severely strained, that it is not in the best interest of the parties, nor is it advisable or practical to order
reinstatement. Under the doctrine of strained relations, payment of separation pay is considered an acceptable
alternative to reinstatement when the latter option is no longer desirable or viable. Indeed, separation pay is made
an alternative relief in lieu of reinstatement in certain circumstances, such as: (1) when reinstatement can no longer
be effected in view of the passage of a long period of time or because of the realities of the situation; (2)
reinstatement is inimical to the employers interest; (3) reinstatement is no longer feasible; (4) reinstatement does
not serve the best interests of the parties involved; (5) the employer is prejudiced by the workers continued
employment; (6) facts that make execution unjust or inequitable have supervened; or (7) strained relations between
the employer and the employee.
Where reinstatement is no longer viable as an option, separation pay equivalent to one (1) month salary for every
year of service should be awarded as an alternative. In lieu of reinstatement, petitioner is entitled to separation pay
equivalent to one (1) month salary for every year of service reckoned from the time he commenced his
employment with TAWTRASCO until finality of this Decision.
In addition, petitioner is entitled to backwages and other emoluments due him from the time he did not report for
work on March 31, 2007 until the finality of this Decision. Said backwages and emoluments shall earn 12%
interest from finality of this Decision until fully paid. The payment of legal interest becomes a necessary
consequence of the finality of the Courts Decision, because, reckoned from that time, the said decision becomes a
judgment for money which shall earn interest at the rate of 12% per annum.
In accordance with Art. 111 of the Labor Code and in line with current jurisprudence, petitioner shall be paid
attorneys fees in the amount equivalent to 10% of the monetary award.
WHEREFORE, the instant petition is GRANTED. Accordingly, the assailed Decision and Resolution dated
October 14, 2010 and June 15, 2011, respectively, of the CA in CA-G.R. SP No. 112542 are SET ASIDE. The
NLRC July 7, 2009 Decision and November 18, 2009 Resolution as well as the April 14, 2008 Order of the Labor
Arbiter are hereby REINSTATED with MODIFICATION in that the Tabaco Womens Transport Service
Cooperative Is ORDERED to pay petitioner Alexander B. Baares the following:
(1) Backwages and other emoluments due to petitioner from March 31, 2007 when petitioner did not report for
work until finality of this Decision with interest thereon at 12% per annum from finality of this Decision until paid;
(2) Separation pay equivalent to one (1) month salary for every year of service reckoned from the time he started
his employment with TAWTRASCO until the finality of this Decision; and
(3) 10% attorney's fees computed from the total monetary benefits.
Banares v. TAWTRASCO G.R. No. 197353 11 of 11

The case is REMANDED to the RAB V of the NLRC in Legaspi City for the computation, as expeditiously as
possible, of the monetary awards.
No pronouncement as to costs.
SO ORDERED.
Peralta, Abad, Mendoza, and Leonen, JJ., concur.