G.R. No. 220617
January 30, 2017
NESTLE PHILIPPINES, INC., Petitioner,
BENNY A. PUEDAN, JR., JAYFER D. LIMBO, BRODNEY N. AVILA, ARTHUR C. AQUINO, RYAN A. MIRANDA, RONALD R. ALAVE, JOHNNY A. DIMAYA, MARLON B. DELOS REYES, ANGELITO R. CORDOVA, EDGAR S. BARRUGA, CAMILO B. CORDOVA, JR., JEFFRY B. LANGUISAN, EDISON U. VILLAPANDO, JHEIRNEY S. REMOLIN, MARY LUZ A. MACATALAD,* JENALYN M. GAMUROT, DENNIS G. BAWAG, RAQUEL A. ABELLERA, and RICANDRO G. GUATNO, JR., Respondents.
On July 6, 2012, the respondents filed a complaint against the petitioner for illegal dismissal and demanding for separation pay, nominal damages and attorney’s fees. The respondents alleged that Ocho de Setiembre Inc. (ODSI) and Nestle Philippines Inc. (NPI) hired them to sell various products of NPI in the assigned covered area. After sometime, the respondents demanded that they be considered regular employees of NPI but they were directed to sign contracts of employment with ODSI instead. However, the respondents refused to comply with such directives resulting from their dismissal from their position. The contention of the respondents is that ODSI is a labor-only contractor and, thus, they should be deemed regular employees of NPI and there was no just or authorized cause for their dismissal. The ODSI averred that it is a company engaged in the business of buying, selling, distributing, and marketing of goods and commodities of every kind and it enters into all kinds of contracts for the acquisition thereof. According to ODSI the respondents were hired as its employees to execute the Distributorship Agreement with the NPI. Unfortunately, the business relationship between the NPI and ODSI turned sour and eventually NPI downsized its marketing and promotional support from ODSI and termination of the Distributorship Agreement. Meanwhile, ODSI argues with the respondents that they were not dismissed but merely on floating status. However, the NPI did not file any position paper or appear in the scheduled conferences.
The Labor Arbiter concluded that all the impleaded respondents therein (i.e. including NPI) should be held liable for the payment of nominal damages plus attorney’s fees.
The aggrieved respondents appealed to National Labor Relation Commission (NLRC) and the NLRC reversed and set aside the Labor Arbiter ruling. The NLRC ordered ODSI and NPI to pay each of the respondents and entitled to separation pay and to nominal damages. The respondents moved for a partial reconsideration arguing since it was ODSI that closed down operations and not the NPI, therefore NPI should reinstate them. However, the NLRC denied the motion.
Moreover, the NPI was dissatisfied hence filed a petition for certiorari before the Court of Appeals (CA) which the CA affirmed the NLRC ruling.
- Whether or not Nestle Philippines Inc. (NPI) and Ocho de Setiembre Inc. (ODSI) are deemed jointly and severally liable for the respondent’s monetary claims.
- Whether NPI was deprived of its right due process
1. No. The Distributorship Agreement between the Nestle Philippines inc. (NPI) and Ocho de Setiembre Inc. (ODSI) is not that of a principal and a contractor, but that of a seller and a buyer/re-seller. Based on the stipulated in the Distributorship Agreement NPI agreed to sell its products to ODSI at discounted prices. According to NPI the goods it manufactures are distributed to the market through various distributors including ODSI, that in turn, re-sell the same to the designated outlets through its own employees as the respondents. Therefore, the reselling activities allegedly performed by the respondents properly pertain to ODSI only.
In effect, ODSI was not a labor-only contractor of NPI hence the NPI cannot be deemed the true employer of the respondents. Therefore, NPI cannot be held jointly and severely liable to ODSI’s monetary obligation towards the respondents.
2. No, NPI was afforded the fair and reasonable opportunity to explain its side. The observance offairness in the conduct of any investigation is at the very heart of procedural due process. The essenceof due process is to be heard, and, as applied to administrative proceedings, this means a fair andreasonable opportunity to explain one’s side, or an opportunity to seek a reconsideration of the action orruling complained of.
As held in Ledesma v. CA, “Due process, as a constitutional precept, does not always and in all situations require a trial-type proceeding. It is satisfied when a person is notified of the charge againsthim and given an opportunity to explain or defend himself.”
In this case, NPI essentially claims that it was deprived of its right to due process when it was not notified of the proceedings before the LA and did not receive copies and issuances from the other parties and the LA, respectively. However, as correctly pointed out by the CA, NPI was furnished via a courier of a copy of the amended complaint filed by the respondents against it as shown by LBC Receipt No.125158910840. It is also apparent that NPI was also furnished with the respondents’ Position Paper, Reply and Rejoinder. Verily, NPI was indeed accorded due process, but as the LA mentioned, the former chose not to file any position paper or appear in the scheduled conferences. Assuming arguendo that NPI was somehow deprived of due process by either of the labor tribunals, such defect was cured by: (a) NPI’s filing of its motion for reconsideration before the NLRC; (b)the NLRC’s subsequent issuance of its Resolution wherein the tribunal considered all of NPI’s arguments as contained in its motion; and (c) NPI’s subsequent elevation of the case to the CA. In Autencio v. Mañara, it was held that defects in procedural due process may be cured when the party has been afforded the opportunity to appeal or to seek reconsideration of the action or ruling complained of