FACTS: Petitioner is printing business in Sta. Cruz Makati. Petitioner informed its workers that it was going to transfer its site in Makati to Batangas. It gave its employees time to inform the management of their willingness to go with petitioner; otherwise, they would find replacements. The union advised petitioner that its members were not willing to transfer to the new site. Private respondents herein filed a complaint for ULP, illegal dismissal, underpayment of wages, non-payment of holiday pay, 13th month pay. SIL and separation pay. The labor Arbiter directed petitioner to pay separation pay and attorney’s fees. The NLRC affirmed the decision, but deleted the award of attorney’s fees.
ISSUE: Whether or not private respondent are entitled to separation pay by virtue of their refusal to transfer to the business in Batangas.
HELD: Yes. Although there is no complete dissolution of petitioner’s undertaking, but a mere relocation; the phrase, “closure or cessation of operation of an establishment not due to serious business losses or reverses,” under Article 288 of the Labor Code includes the cessation of only part of a company’s business. Petitioner did have legitimate reason to relocate its plant due to the expiration of the lease contract in Makati; however petitioner is still required to pay its workers separation pay. Cessation of operation not due to serious business losses is an authorized cause for termination; but the Labor Code provides that the terminated employees are entitled to separation pay of 1 month pay or less ½ for every year of service, whichever is higher.
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