Almirante: Suspension of operations

On April 9, 1992, petitioner Airborne Maintenance and Allied Services Inc. (Airborne) hired the services of respondent Arnulfo Egos as janitor. He was assigned at the Balintawak branch of Meralco, a client of Airborne.

On June 30, 2011, the contract between Airborne and Meralco-Balintawak branch expired and a new contract was awarded to Landbees Corp. which absorbed all employees of Airborne except respondent, who allegedly had a heart ailment. Respondent consulted another doctor who declared him in good health and fit to work. He showed a duly issued medical certificate to Airborne but the same was disregarded. Feeling aggrieved, respondent filed a complaint for constructive illegal dismissal on Aug. 5, 2011.

Airborne insisted that respondent was never dismissed from the service. It claimed that when its contract with Meralco was terminated, it directed all its employees including respondent to report to its office for reposting. When respondent failed to comply with the directive, it sent him letters dated Aug. 12, 2011 and Sept. 21, 2011 to his last known address reiterating the previous directive but which were returned with a notation “RTS unknown.” It further argued that it had placed respondent on floating status when the contract with Meralco was terminated.

Does Airborne’s defense find merit?

Ruling: No.

The Court finds that petitioner failed to prove that the termination of the contract with Meralco resulted in a bona fide suspension of its business operations so as to validly place respondent in a floating status.

In implementing this measure, jurisprudence has set that the employer should notify the Department of Labor and Employment (Dole) and the affected employee, at least one month prior to the intended date of suspension of business operations. An employer must also prove the existence of a clear and compelling economic reason for the temporary shutdown of its business or undertaking and that there were no available posts to which the affected employee could be assigned.

Here, a review of the submissions of the parties shows that petitioner failed to show compliance with the notice requirement to the Dole and respondent.

Making matters worse for petitioner, it also failed to prove that after the termination of its contract with Meralco it was faced with a clear and compelling economic reason to temporarily shut down its operations or a particular undertaking. It also failed to show that there were no available posts to which respondent could be assigned.

Also, not only did petitioner fail to prove it had valid grounds to place respondent on a floating status, but the National Labor Relations Commission (NLRC) and the Court of Appeals both correctly found that respondent even had to ask for a new assignment from petitioner, but this was unheeded. Further, when respondent filed the complaint on Aug. 5, 2011, petitioner, as an afterthought, subsequently sent notices/letters to respondent directing him to report to work. These, however, were not received by respondent as the address was incomplete.

Here, the totality of the foregoing circumstances shows that petitioner’s acts of not informing respondent and the Dole of the suspension of its operations, failing to prove the bona fide suspension of its business or undertaking, ignoring respondent’s follow-ups on a new assignment, and belated sending of letters/notices which were returned to it, were done to make it appear as if respondent had not been dismissed. These acts, however, clearly amounted to a dismissal, for which petitioner is liable. (Airborne Maintenance and Allied Services Inc. vs. Arnulfo M. Egos, G.R. 222748, April 2019).


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