CONSTRUCTION CORPORATION (PNCC), VS. NATIONAL LABOR

Ruling

WHEREFORE, the Order of Labor Arbiter Ricardo C. Nora dated May 26, 1994, to the extent that it reduced complainant's (private respondent) backwages, is hereby set aside. As prayed for by complainant, "the computation of the Research and Information Unit of the NLRC National Capital Region in the amount of P 468,700.00" is hereby reinstated, to serve as basis for the issuance/enforcement of the pertinent writ of execution. "SO ORDERED." Petitioner's motion for reconsideration was denied in an Order [7] dated August 22, 1995. Hence, the petition. The sole issue is whether the public respondent gravely abused its discretion in using the overseas salary rate of private respondent in computing his backwages. Petitioner urges that the computation of his backwages should be based on the local salary rate at the time of his separation from employment. It contends that unjust enrichment would result if the overseas salary rate of private respondent is used as the basis in computing his backwages. It points out that private respondent's employment contract for the Middle East project already expired in 1984. All of private respondent's claims under the overseas employment contract had been paid, hence, he could no longer make any other claim under his expired contract. In its Comment [8] dated March 5, 1996, the Office of Solicitor General (OSG) agreed with petitioner. The OSG further stressed that private respondent was illegally dismissed from the work pool after, and not during his stint abroad. Therefore, considering that upon his return, he reverted to his former status as an ordinary work pool employee of petitioner, he should be paid in accordance with the local wage rate. It also argued that the computation of his backwages could not be based on the US $2.20 per hour rate because it was meant only for the duration of the foreign project. For its part, public respondent contends that private respondent's last salary with petitioner at the time of his dismissal was US $2.20 per hour, hence, his backwages should be based on the said rate. The petition is meritorious. An illegally dismissed employee is usually reinstated to his former position without loss of seniority rights and paid backwages from the time he was separated from work up to his actual reinstatement. [9] The purpose of reinstatement is to restore the employee to the state or condition from which he has been removed or separated. Backwages aim to replenish the income that was lost by reason of the unlawful dismissal. [10] In the case at bar, we hold that the NLRC gravely abused its discretion in computing private respondent's backwages based on his salary abroad. The records show that private respondent was not illegally dismissed while working in the Middle East project of the petitioner. His overseas assignment was a specific project and for a definite period. Upon the completion of the project in 1984, he received all the benefits due him under the overseas contract. He then voluntar