NLRC orders Stream Global Services to pay more than 2.7M
The present dispute stemmed sometime in July 2013 when the complainants received a Notice of Temporary Lay-Off.
Aggrieved, the complainants went to DOLE-SENA to seek assistance. After a series of conciliation conference, the parties arrived at an amicable settlement on July 24, 2013. The respondent company was represented by Ms. Sharon Gozun, the Human Resource Manager.
The parties agreed on the following;
- Requesting parties are on leave with pay status up to August 5, 2013.
- From August 6, 2013, a 30-day notice with DOLE shall be served effecting authorized separation of requesting parties on September 1, 2013.
- Stream Global Services to issue COE’s to concerned employees
- Respondent to remit SSS balance with the agencies
- Respondent to furnish a proof of compliance of the total claims paid to requesting parties by October 1, 2013.
However, sometime in late July 2013, the complainants were surprised when they received a letter from the respondent company directing them to report for work on August 1 or 2, 2013.
On August 6, 2013, the respondent company wrote a letter to DOLE-SENA informing them of the need to fill up 11 posts as Technical Support Professionals and in view of this development; they asked DOLE-SENA to set aside the “Separation” aspect of the amicable settlement they entered with the complainants.
In response, the complainants wrote the respondent a letter expressing their unwillingness to return to their jobs. They likewise invoked the amicable settlement they entered into with the respondent company.
For the respondent’s refusal to abide by the compromise agreement, the DOLE-SENA endorsed the case to the NLRC for the enforcement of the compromise agreement.
The respondent company principally argued that the complainants were never dismissed from their jobs. Instead, they claimed that the complainants were merely placed on temporary lay-off for a period not exceeding 6 months. Given the fact that the complainants were not dismissed, they are not entitled to their claim for separation pay. They also argued that the agreement cannot be given effect since it was incomplete. Moreover, they disowned the authority of Ms. Sharon Gozun (HR Head) to enter any compromise agreement with the complainants. To prove this, they submitted a Board Resolution authorizing a certain Atty. Michael Montero to settle the case in behalf of the management. Effectively, due to her lack of authority, the respondent company cannot be considered to have consented to the agreement and therefore they cannot be bound by the terms entered into by Ms. Gozun in excess of her authority.
Article 1370 of the new civil code provides that, if the terms of the contract are clear and leave no doubt upon the intention of contracting parties, the literal meaning of its stipulations shall control.
Now, in challenging the validity and binding effect of the amicable settlement, the respondent argued that the settlement agreement was incomplete and was done without the compliance with the SENA rules. They likewise, invoked the lack of authority of Ms. Sharon Gozun, in entering in a compromise.
With regard to the required form of compromise agreement under the SENA rules, it merely requires that settlement agreements must be reduced in writing. While the terms of the agreement of the parties were contained in the “minutes” of the hearing, the same will not affect the validity of the compromise agreement. Besides, the more important aspect thereof lies not on the form but on the substance voluntarily entered into by the parties to settle their differences.
The alleged lack of authority of Ms. Sharon Gozun in entering into a compromise agreement in behalf of the respondent company, according to arbiter is “Flimsy and unworthy of credence” because it must be recalled that from day one of the SENA case, the respondent company has been represented by no less than their Human Resource Manager, in the person of Ms. Sharon Gozun. Understandably so, Ms. Gozun presumably was the most knowledgeable person in the company on matters pertaining to personnel actions and decisions. During the course of the hearings conducted with the SENA, the matter pertaining to the authority given to Ms. Gozun was never made an issue by any party. When the parties finally agreed to settle their differences, it was Ms. Gozun who signed the agreement. She would not have signed the agreement if she does not have the authority.
Section 2, Rule V of the SENA Rules of Procedure explicitly provides that settlement agreements reached by the parties are final and binding.
Consequently, by reason of the “authorized separation of the complainants, they are entitled to be paid of their separation pay of in the amount of one month pay for every year of service.
By reason of their unjustified refusal to abide by the terms of the compromise agreement despite the clear wordings thereof, the respondent company cannot be said to be acting in good faith. They were fully aware of the validity and binding effect of the agreement. Despite this, they refused to abide by their undertakings. As such, the complainants are entitled to the payment of moral and exemplary damages. Similarly, since they were forced to obtain the services of a legal counsel to protect their rights, the complainants are entitled to attorney’s fees.
Wherefore, judgement was rendered to uphold the validity and binding effect of the amicable settlement entered into by the parties before the DOLE-SENA on July 24, 2013. Accordingly, Steam Global Services Phils., Inc. is ordered to comply with their obligations pursuant to the compromise agreement.
Consequently, Steam Global Services Phils., Inc. is ordered to pay the complainant’s judgement awards as follows:
Source: http://www.nlrc.dole.gov.ph/content/decision/RAB III-08-20427-13.PDF