FACTS: Jonathan Barquin was the only employee of the Philippine Carpet Manufacturing Corporation receiving minimum wage (all other employees were paid above the minimum wage). Wage Orders were issued, and the company refused to implement them, claiming that no one in the company was receiving the minimum wage, hence the company was not covered by such Wage Orders. As it turned out, the company had dismissed Barquin on grounds of retrenchment, so by the time the union made the demand for compliance with the Wage Orders, there really was no employee receiving the minimum wage. The voluntary arbitrator then ruled that Barquin had been illegally dismissed so the company could avoid compliance with the Wage Order, but was not entitled to reinstatement since he had received separations pay and had signed a quitclaim.
ISSUES: Was Barquin illegally dismissed, and if yes, is he entitled to reinstatement?
HELD: Yes, he was illegally dismissed and is entitled to reinstatement. The company can not claim retrenchment, since it is highly improbable that lying off one minimum wage worker would help stem the losses of the company. The latter’s motive in terminating Barquin was to avoid compliance with the Wage Orders, since doing so would cause a wage distortion, and require the company to raise all the workers salaries.
Since Barquin was misled by the company that he has being retrenched, his consent to the quitclaim was vitiated by mistake, and thus the quitclaim was invalid.
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