EDI-STAFFBUILDERS INTERNATIONAL, INC.

vs NLRC
G.R. No. 145587, October 26, 2007
Facts:
Eleazar Gran was an OFW recruited by EDI-Staffbuilders International,
Inc. (EDI) and was deployed by Expertise Search International (ESI) to work
for Omar Ahmed Ali Bin Bechr Est. (OAB) in Riyadh. As part of the terms and
conditions of employment, Gran was to be paid a monthly salary of SR
2,250.00 (USD 600.00). After accepting the offer of employment, Gran signed
an employment contract that granted him a monthly salary of USD 850.00.
He questioned the discrepancy; however, OAB agreed to pay him USD
850.00. After five months, his employment was terminated. He received his
final pay of SR 2,948, and executed a Declaration releasing OAB from any
financial obligation or otherwise, towards him. Gran filed a complaint with
the Labor Arbiter for illegal dismissal and underpayment of wages. The Labor
Arbiter upheld the dismissal and ruled that there was no underpayment. The
NLRC reversed this decision. Upon reaching the CA, it upheld NLRCs
decision, and held that the Declaration signed by Gran did not bar him from
demanding benefits to which he was entitled. In this petition, EDI questions
the legality of award of backwages, stating as basis the Declaration signed
by Gran.
Issue:
Does a Declaration releasing an employer from obligations by a
terminated employee constitute a valid waiver and quitclaim?
Ruling:
No. The Court held that the salary paid upon termination was
unreasonably low, the payment of SR 2,948.00 is even lower than his
monthly salary of SR 3,190.00 (USD 850.00). If the Declaration is a quitclaim,
then the consideration should be much much more than the monthly salary
of SR 3,190.00 (USD 850.00)although possibly less than the estimated
Gran's salaries for the remaining duration of his contract and other benefits
as employee of OAB. A quitclaim will understandably be lower than the sum
total of the amounts and benefits that can possibly be awarded to employees
or to be earned for the remainder of the contract period since it is a
compromise where the employees will have to forfeit a certain portion of the
amounts they are claiming in exchange for the early payment of a
compromise amount. The court may however step in when such amount is
unconscionably low or unreasonable although the employee voluntarily
agreed to it. In the case of the Declaration, the amount is unreasonably small
compared to the future wages of Gran.

Validity of compromise agreements and quitclaims in settlement of labor

disputes
ARELLANO, et.al., vs POWERTECH CORPORATION
G.R. No. 150861, January 22, 2008
Facts:
In 1999, the Labor Arbiter declared that Powertech illegally terminated
the petitioners and granted their monetary claims for Php 2,500,000.00.
During the pendency of the appeal to NLRC by Powertech, Carlos Gestiada
for himself and on behalf of other petitioners executed a quitclaim, release
and waiver in favor of Powertech for Php 150,000. He was also appointed as
their attorney-in-fact evidenced by a special power of attorney. Relying on
the quitclaim and release, Powertech filed a motion for the withdrawal of the
appeal and cash bond which was granted by NLRC. When the check bounced,
by motion of the petitioners, NLRC declared the quitclaim, release and waiver
void for lack of consideration, reinstated the appeal and ordered Powertech
to post a cash or surety bond. Powertech paid GestiadaPhp 150,000.00 for
the employees and both parties filed a joint motion to dismiss which was
denied by the NLRC. On appeal, the CA ruled in favor of Powertech annulling
the decision of NLRC in denying the joint motion to dismiss.
Issue:
Was there a valid compromise agreement binding among the
employees although executed only by their appointed attorney-in-fact
purportedly for himself?
Ruling:
No. The Court considered the act of Gestiada as a form of collusion,
which is a ground for the NLRC to declare a compromise agreement void. As
provided for by law, The National Labor Relations Commission or any court
shall not assume jurisdiction over issues involved therein except in case of
non-compliance thereof or if there is prima facie evidence that the
settlement was obtained through fraud, misrepresentation, or coercion. The
Court took into account the bad faith on the part of Powertech in negotiating
with the employees for fear of the higher amount of liability if the Labor
Arbiters decision will be accorded with finality.

Validity of compromise agreements and quitclaims in settlement of labor

disputes
GOODRICH MANUFACTURING CORPORATION vs ATIVO, et.al.
GR No. 188002, February 1, 2010
Facts:
The respondents in this case were former employees of Goodrich.
Sometime in 2004, the company offered an option for the employees to
voluntarily resign because the company was suffering from financial
constraints. The respondents then availed this voluntary resignation and
were paid their separation pay. They also executed their respective waivers
and quitclaims. Afterwards, the employees claim they have been illegally
dismissed. The Labor Arbiter rendered a decision declaring that there was no
illegal dismissal, but sustained the money claims. The NLRC reversed this
decision. Upon reaching the CA, the court reinstated the decision of the
Labor Arbiter. In this case, Goodrich claims that the waivers and quitclaims
were valid, and that allowing the respondents to recover their monetary
claims would render the waivers nugatory, considering that there was no
coercion during the execution of the waivers.
Issue:
Are employees quitclaims and waivers executed freely without any
coercion valid and binding?
Ruling:
Yes. Not all waivers and quitclaims are invalid as against public policy.
If the agreement was voluntarily entered into and represents a reasonable
settlement, it is binding on the parties and may not later be disowned simply
because of a change of mind. It is only where there is clear proof that the
waiver was wangled from an unsuspecting or gullible person, or the terms of
settlement are unconscionable on its face, that the law will step in to annul
the questionable transaction. But where it is shown that the person making
the waiver did so voluntarily, with full understanding of what he was doing,
and the consideration for the quitclaim is credible and reasonable, the
transaction must be recognized as a valid and binding undertaking.

Registration of Labor organizations

ASSOCIATED TRADE UNION vs NORIEL
GR No. L-48367, January 16, 1979
Facts:
Federation of Free Workers (FFW)-Synthetic Marketing and Industrial
Corporation Chapter filed a petition for certification election among the rankand-file employees of Synthetic Marketing and Industrial Corporation 48 days
before the expiration of an old CBA. As alleged in the petition, more than
30% of the total work force were in support of the election, attaching the
signatures of said union members. However, the Associated Trade Unions
(ATU)-KILUSAN was still existing and it had a renewed CBA with the employer
which was still in force then. Both the company and ATU opposed on the
ground that the certification election is contract-barred by virtue of the
existence of the CBA duly registered with the BLR. FFW assailed the validity
of the said CBA on the ground that it was executed 5 months and 21 days
prior to the expiration of the old CBA and that it was not ratified by the
members of the bargaining unit. Said CBA was registered with the BLR
approximately 3 months prior to the expiration of the old CBA. The renewed
CBA was certified 28 days before expiration of the old CBA. The Med-Arbiter
ordered for the conduct of the certification election. ATU appealed the order
to BLR Director Noriel, who affirmed the Med-Arbiters decision.
Issue:
Can a CBA being assailed for its invalidity contract-bar a petition for
certification election?
Ruling:
Yes. According to the Court, the contract-bar rule does not apply to the
case. The contract-bar rule would preclude a certification election. That was
to ignore the decertification of the collective bargaining agreement which
was hastily and prematurely entered into precisely for the purpose of
avoiding the holding of the certification election. From the foregoing facts,
the renewed CBA between ATU and the company cannot substitute a bar to
the instant petition for certification election. In the first place, the said CBA
was certified after the instant petition for certification had been filed by
herein respondent union, and its certification was conditioned upon the fact
that there was no pending petition for certification election with the Bureau
of Labor Relations. The new CBA was not yet in existence when the instant
petition for certification election was filed. It is undubitably clear from the
facts heretofore unfolded that management and petitioner herein proceeded
with such indecent haste in renewing their CBA way ahead of the 'sixty-day
freedom period' in their obvious desire to frustrate the will of the rank-andfile employees in selecting their collective bargaining representative. To

countenance the actuation of the company and the petitioner herein would
be violative of the employees' constitutional right to self-organization.
Registration of Labor organizations
TOYOTA MOTORS PHILIPPINES CORPORATION LABOR UNION vs
TOYOTA MOTOR PHILIPPINES CORPORATION
G.R. No. 135806, August 8, 2002
Facts:
Toyota Motors Philippines Corporation Employees and Workers Union
(TMPCEWU) filed a petition for certification election. Toyota Motor Philippines
Corp. Labor Union (TMPCLU) filed a motion to intervene with opposition,
claiming that the petition was premature due to an earlier resolution by the
Secretary of Labor ordering the conduct of a certification election among the
rank-and-file employees of TMPC represented by petitioner which was the
subject of certiorari proceedings before the Supreme Court and still awaiting
final resolution at the time; and, that the collective bargaining unit which
respondent TMPCEWU sought to represent violated the "single or employer"
unit policy since it excluded the rank-and-file employees in the other
divisions and departments in respondent TMPC. In said SC decision, the legal
personality of TMPCEWU was being assailed, its membership being
composed of supervisory and rank-and-file employees.
Issue:
Can a labor union not yet being issued with a certificate of registration
validly file a petition for certification election?
Ruling:
No. If a labor organizations application for registration is vitiated by
falsification and serious irregularities, a labor organization should be denied
recognition as a legitimate labor organization. And if a certificate of
registration has been issued, the propriety of its registration could be
assailed directly through cancellation of registration proceedings in
accordance with Arts. 238 and 239 of the Labor Code, or indirectly, by
challenging its petition for the issuance of an order for certification election.
In the present case, since TMPCEWU had not acquired legal personality for
the reason that its composition, being a mixture of supervisory and rank-andfile employees, it cannot validly file a petition for election, moreso can it
become a bargaining representative of the workers in the company.

Registration of Labor organizations

SAN MIGUEL FOODS INC vs SAN MIGUEL CORP. SUPERVISORS AND
EXEMPT UNION
G.R. No. 146206, August 1, 2011
Facts:
Pursuant to a Supreme Court decision, the DOLE conducted preelection conferences on SMCSEUs petition for certification election. The MedArbiter ordered to proceed with the election. The company San Miguel Foods
Inc. questioned the eligibility to vote by some of its employees, particularly
those alleged confidential employees who were working as Payroll Manager
and those who have access with the salary and compensation data, the HR
Assistant and Personnel Assistant and those employees working in the live
chicken operations who are not covered by the bargaining unit. It also
alleges that the employees of the Cabuyao, San Fernando, and Otis plants of
petitioners predecessor, San Miguel Corporation, as stated in G.R. No.
110399, were engaged in "dressed" chicken processing, i.e., handling and
packaging of chicken meat, while the new bargaining unit includes
employees engaged in "live" chicken operations, i.e., those who breed chicks
and grow chickens. Despite the objections, the Med-Arbiter ruled that
SMCSEU was certified to be the exclusive bargaining agent of the supervisors
and exempt employees.
Issues:
1) Can the workers of separate divisions whose tasks are interrelated
form a single union?
2) Can confidential employees join the bargaining unit of a company?
Ruling:
1) Yes. The Court by taking into account the community or mutuality of
interests test said that those employees in the live chicken processing
and dressed chicken processing divisions held that they can form a
union. While the existence of a bargaining history is a factor that may
be reckoned with in determining the appropriate bargaining unit, the
same is not decisive or conclusive. Other factors must be considered.
The test of grouping is community or mutuality of interest. This is so
because the basic test of an asserted bargaining units acceptability is
whether or not it is fundamentally the combination which will best
assure to all employees the exercise of their collective bargaining
rights.
2) No. A confidential employee is one entrusted with confidence on
delicate, or with the custody, handling or care and protection of the
employers property. Confidential employees should be excluded from
the bargaining unit, as their access to confidential information may
become the source of undue advantage. However, in this case, the

Court did not apply such fact to the Payroll Manager and those working
with salary and compensation data, saying that the job does not
involve dealing with confidential labor relations information in the
course of the performance of his functions.