G.R. NO. 157752 -

Ruling

WHEREFORE , the petition is GIVEN DUE COURSE and the assailed decisions of the National Labor Relations Commission and the labor arbiter are ANNULED and SET ASIDE . Let this case be remanded to the Arbitration Branch of the National Labor Relations Commission for further proceedings. [4] The March 21, 2003 Resolution denied reconsideration. The Facts The facts are narrated by the CA as follows: For several years, Glorious Sun Garment Manufacturing Company (or Glorious Sun) was a garment exporter until it folded up in October 1994. Thereafter, De Soliel [sic] [5] Apparel Manufacturing Corporation [or De Soleil] and American Inter-Fashion Corporation (or AIFC) took over Glorious Suns manufacturing plant, facilities and equipment and absorbed its employees, including the [petitioners]. Following the 1986 EDSA Revolution, the Presidential Commission on Good Government (or PCGG) sequestered De Soleil and AIFC and took over their assets and operations. On April 24, 1989, JCT Group, Inc. (or JCT) and De Soleil, thru its Officer-In-Charge and Head of the PCGG Management Team, executed a Management and Operating Agreement (or MOA) for the purpose of servicing De Soleils export quota to ensure its rehabilitation and preserve its viability and profitability. The MOA, which was for a period of one year commencing on May 1, 1989 and renewable yearly at the option of JCT, expired on May 1, 1990 as it was not renewed. In July 1990, De Soleil ceased business operations, effectively terminating [petitioners] employment. In April 1993, [petitioners] filed complaints for illegal dismissal and payment of backwages and other monetary claims before the National Labor Relations Commission (or NLRC) Arbitration Branch against De Soleil, AIFC, PCGG, Glorious Sun, JCT, Nemesio Co and Vicente Cuevas III (or Cuevas). The cases were eventually consolidated. On May 26, 1993, JCT and Cuevas x x x filed a motion to dismiss founded on lack of jurisdiction over the subject matter of the action because of the absence of [an] employer-employee relationship between them and [petitioners]. Without resolving the motion to dismiss, Labor Arbiter Vladimir P.L. Sampang rendered a decision dated April 18, 1995 disposing as follows: WHEREFORE, judgment is hereby rendered: 1) Declaring [De Soleil, AIFC, PCGG, Glorious Sun, JCT, Nemesio Co and Cuevas] jointly and severally guilty of illegal dismissal and to pay complainants backwages, separation pay, service incentive leave pay, 13th month pay, unpaid salaries as computed by the Research and Information Unit x x x; 2) Declaring [De Soleil, AIFC, PCGG, Glorious Sun, JCT, Nemesio Co and Cuevas] liable for the payment of attorneys fees equivalent to ten (10%) percent of the total awards or P3,691,743.06. The monetary award, inclusive of attorneys fees, aggregated P41,313,094.98 as per computation of the Research and Information Unit. Considering the amount involved, [Respondents JCT and Cuevas] and Glorious Sun