Victory Liner v. Race | Chico-Nazario, J.
Keywords: Injured bus driver illegally dismissed; Prescription: 4 years from
the accrual of the cause of action
FACTS:
Pablo M. Race was employed by Victory Liner, Inc. as a bus driver
for the Alaiminos, Pangasinan Cubao, Quezon City evening
route.
24 August 1994: Races bus figured in an accident, wherein Race
suffered a fractured leg, for which he was confined in the hospital
until 10 October 1994.
10 November 1994: Race was confined again for further treatment
for another month.
Victory Liner shouldered all of Races medical expenses for both
instances.
January 1998: Race reported for work, but was informed that he
was considered resigned, and was offered consideration of
P50,000.00, which he rejected.
Before Christmas 1998: Victory Liner reiterated that he was
regarded as resigned, this time, offering him P100,000.00, which
he again rejected.
30 June 1999: Race sent a letter to Victory Liner demanding
employment-related money claims; no response from Victory
Liner.
1 September 1999: Race filed a complaint before the Labor Arbiter
for:
o Unfair labor practice;
o Illegal dismissal;
o Underpayment of wages;
o Nonpayment of overtime and holiday premium, service
incentive leave pay, vacation and sick leave benefits,
13th month pay;
o Excessive deduction of withholding tax and SSS
premium; and
o Moral and exemplary damages and attorneys fees.
LABOR ARBITER: Dismissed; stating that the prescriptive period
for filing a case for illegal dismissal had elapsedconsidered
dismissed on 24 November 1994.
NLRC: Reversed Labor Arbiter; cause of action accrued in January
1998, when Race reported for work but was rejected; Also stated
that Victory Liner failed to accord Race due process in terminating
his employment.
ISSUE/HELD:
[1] WoN the cause of action for illegal dismissal had prescribed.
NO. Cause of action accrued January 1998.
[2] WoN Race was illegally dismissed, thus entitled to
reinstatement with full back wages and other benefits.YES. But
separation pay in lieu of reinstatement.
RATIO:
[1] Prescription
Victory Liner insists that Race already abandoned his work and
ceased to be its employee since November 1994.
o Among other arguments, under the 4-fold test of
employer-employee relationship: Victory claimed that it
no longer paid Race wages nor exercised control over him
since November 1994.
o If reckoning period is counted from when the written
demand was made by Race, the 4-year prescriptive
period would be indeterminate, contrary to the spirit of
the law.
In illegal dismissal cases, the employee concerned is given a
period of four years from the time of his dismissal within which
to institute a complaint.
o Art. 1146 [CC] Actions based upon an injury to the
rights of the plaintiff must be brought within four
years.
o Employment is a property rightwithin the protection
of a constitutional guarantee of dues process of law.
o Therefore, when one is arbitrarily and unjustly deprived
of his job or means of livelihood, the action instituted to
contest the legality of ones dismissal from employment
constitutes, an action predicated "upon an injury to the
rights of the plaintiff."
The four-year prescriptive period shall commence to run only
upon the accrual of a cause of action of the workerthe
time the employment of the worker was unjustly
terminated.
Race was not unjustly terminated on 10 November 1994
o At that time, still confined for further treatment of his
fractured left leg.
o He must be considered as merely on sick leave
Neither could be deemed as illegally dismissed from work upon his
release in December 1994 up to December 1997.
o Race still reported for work to the petitioner and was
granted sick and disability leave by Victory Liner for that
period.
Race must be considered as unjustly terminated in January 1998
since this was the first time he was informed by the Victory Liner
that he was deemed resigned from his work.
 Consequently, Races filing of complaint for illegal dismissal on 1
September 1999 was well within the four-year prescriptive period.
It must also be noted that from 10 November 1994 up to
December 1997, Victory Liner never formally informed the
respondent of the fact of his dismissal
Moveover, Race did not abandon his work for lack of the 2 factors
that constitute abandonment:
o Failure to report for work or absence without valid or
justifiable reason; and
o A clear intention to sever employer-employee
relationship.
Similarly, the employer-employee relationship between the
petitioner and respondent cannot be deemed to have been
extinguished on 10 November 1994,.
o Race reported for work to the petitioner after his release
from the hospital in December 1994.
o He was also granted a 120-day sick leave and disability
leave
o And also availed himself of the services of the Victory
Liners physician on two occasions after his release
o Victory Liner failed to establish the fact that Race ceased
to be its employee on 10 November 1994, except for its
flimsy reason that the sick leave, disability leave and
physician consultations were given to the respondent as
mere accommodations for a former employee.
[2.b.] Reinstatement
Race was willing to be hired as a dispatcher or conductor, and was
no longer requesting to be reinstated as a driver since he
cannot drive anymore due to his leg injury.
Even assuming that Race was willing, reinstatement would still be
unwarranted.
o Since Victory Liner is a common carrier, and is obliged to
exercise extra-ordinary diligence in transporting its
passengers, it would be a violation of this diligence to
reinstate an incapacitated driver.
o An employer may not be compelled to continue to
employ such persons whose continuance in the
service will patently be inimical to his interests.
Therefore, in lieu of reinstatement, payment to respondent of
separation pay equivalent to one month pay for every year of
service.

[2.a.] Illegal dismissal

The Labor Code mandates that before an employer may legally
dismiss an employee from the service, the requirement of
substantial and procedural due process must be complied
with.
Substantial due processthe grounds for termination of
employment must be based on just or authorized causes.
o Although abandonment of work is within the scope of the
just causes for termination (under gross and habitual
neglect by the emlployee of his duties), the court found
that there was not abandonment on the part of Race.
The records also failed to show that the said charges were proven
and that respondent was duly informed and heard with regard to
the accusations.
And as Victory Liner is the employer, it is its burdened to prove
just cause for terminating the employment of respondent with
clear and convincing evidence, and that Victory Liner failed to
discharge this burden, we hold that respondent was dismissed
without just cause by the petitioner.