Emeritus Security and Maintenance Systems, Inc. v.

Dailig

FACTS: Dailig was employed as a security guard assigned to petitioner's various clients, the
last of which was Panasonic. On 10 December 2005, he was relieved from his post.

On 27 January 2006, he filed a complaint for underpayment of wages, non-payment of legal

and special holiday pay, premium pay for rest day and underpayment of ECOLA before DOLE.
The hearing officer recommended the dismissal of the complaint since the claims were
already paid.

On 16 June 2006, respondent filed a complaint for illegal dismissal and payment of
separation pay against petitioner before the Conciliation and Mediation Center of NLRC. O

On 14 July 2006, respondent filed another complaint for illegal dismissal, underpayment of
salaries and non-payment of full backwages before the NLRC. He claimed that on various
dates, he went to petitioner’s office to follow-up his next assignment, but still he was not
given a new assignment. He argued that if an employee is on floating status for more than six
months, such employee is deemed illegally dismissed.

Petitioner denied dismissing respondent. It admitted that it relieved respondent from his
last assignment on 10 December 2005; however, on 27 January 2006 it sent respondent a
notice requiring him to report to the head office within 72 hours from receipt of said notice.
It further alleged that it had informed respondent that he had been absent without official
leave for the month of January 2006, and that his failure to report within 72 hours from
receipt of the notice would mean that he was no longer interested to continue his
employment.

LA declared that complainant has been illegally dismissed; ordered the company to reinstate
complainant and to pay him backwages. NLRC affirmed LA’s decision; denied MR. But it
pointed out that computation of backwages should be reckoned from 10 June 2006 and not
10 Dec 2005. CA affirmed LA and NLRC but set aside the reinstatement order and instead
ordered the payment of separation pay, invoking the doctrine of strained relations between
the parties.

ISSUE #1: Whether or not Dailig was illegally dismissed by the company.

ISSUE #2: If he was, whether or not he is entitled to separation pay, instead of reinstatement.

HELD #1: YES. Respondent was on floating status from 10 December 2005 to 16 June 2006
or more than six months. Petitioner’s allegation of sending respondent a notice requiring
him to report for work, is unsubstantiated, and thus, self-serving.

The Court agrees with the ruling of the LA, NLRC and CA that a floating status of a security
guard, such as respondent, for more than six months constitutes constructive dismissal. In
Nationwide Security and Allied Services, Inc. v. Valderama, the Court that the temporary
inactivity or "floating status" of security guards should continue only for six months.
Otherwise, the security agency concerned could be liable for constructive dismissal. The
failure of petitioner to give respondent a work assignment beyond the reasonable six-month
period makes it liable for constructive dismissal.

HELD #2: NO. Article 279 of the Labor Code of the Philippines mandates the reinstatement
of an illegally dismissed employee. Thus, reinstatement is the general rule, while the award
of separation pay is the exception. The circumstances warranting the grant of separation pay,
in lieu of reinstatement, are laid down by the Court in Globe-Mackay Cable and Radio
Corporation v. NLRC, thus: Over time, the following reasons have been advanced by the Court
for denying reinstatement under the facts of the case and the law applicable thereto; that
reinstatement can no longer be effected in view of the long passage of time or because of the
realities of the situation; or that it would be ‘inimical to the employer’s interest;’ or that
reinstatement may no longer be feasible; or, that it will not serve the best interests of the
parties involved; or that the company would be prejudiced by the workers’ continued
employment; or that it will not serve any prudent purpose as when supervening facts have
transpired which make execution on that score unjust or inequitable or, to an increasing
extent, due to the resultant atmosphere of ‘antipathy and antagonism’ or ‘strained relations’
or ‘irretrievable estrangement’ between the employer and the employee.