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#75 - DUMAPIS, Et - Al. V. LEPANTO

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#75. DUMAPIS, et.al. V. LEPANTO CONSOLIDATED MINING CO.

G.R. NO. 204060, SEPTEMBER 15, 2020

ISSUE:
What is the correct formula for computing the award of separation pay and backwages
for illegally dismissed employees.

INSTRUCTIONS LEARNED:
In CICM Mission Seminaries, et al. v. Perez citing Bani Rural Bank, Inc. v. De Guzman, the
Court through the Second Division laid down the rule that the award of separation pay
and backwages for illegally dismissed employees should be computed from the time they
got illegally dismissed until the finality of the decision ordering payment of their
separation pay, in lieu of reinstatement.

The Court now ordains the uniform rule that the award of backwages and/or separation
pay due to illegally dismissed employees shall include all salary increases and benefits
granted under the law and other government issuances, Collective Bargaining
Agreements, employment contracts, established company policies and practices, and
analogous sources which the employees would have been entitled to had they not been
illegally dismissed. On the other hand, salary increases and other benefits which are
contingent or dependent on variables such as an employee's merit increase based on
performance or longevity or the company's financial status shall not be included in the
award.

This ruling is consistent with the Constitutional command that the State shall afford full
protection to labor, viz.:

Section 3. The State shall afford full protection to labor, local and overseas, organized and
unorganized, and promote full employment and equality of employment opportunities
for all. (Article XII)

and the edict under Article 3, Chapter I of the New Labor Code, thus:

Art. 3. Declaration of Basic Policy. The State shall afford protection to labor, promote full
employment, ensure equal work opportunities regardless of sex, race or creed and
regulate the relations between workers and employers. The State shall assure the rights
of workers to self-organization, collective bargaining, security of tenure, and just and
humane conditions of work.

Most important, it conforms with the purpose to restore an illegally dismissed employees
to the same status as if their employment was not illegally severed by allowing them to
continuously enjoy the salary, benefits, and allowances they were assured to receive
during the term of their employment.

RAQUEL Q. CANDELARIA
JD 4A
LABOR LAW REVIEW
As a point of clarification, we are not disturbing the final and executory decisions here as we are
dealing only with their execution. We are concerned merely with the mathematical
computation of what petitioners are entitled to as a result of the final and executory decisions in
question.

RAQUEL Q. CANDELARIA
JD 4A
LABOR LAW REVIEW

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