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The Labor Arbiter's order was subsequently appealed by both parties, private
respondent Vega assailing the dismissal of his complaint for lack of
jurisdiction and petitioner Corporation questioning the propriety of the award
of "financial assistance" to Mr. Vega. Acting on the appeals, the public
respondent National Labor Relations Commission, on 4 September 1987,
rendered a Decision, 5 the dispositive portion of which reads:
WHEREFORE, the appealed Order is hereby set aside and another udgment
entered, order the respondent to pay the complainant the amount of
P60,000.00 as explained above.chanroblesvirtualawlibrary chanrobles virtual
law library
SO ORDERED.
In the present Petition for certiorari filed on 4 December 1987, petitioner
Corporation, invoking Article 217 of the Labor Code, seeks to annul the
Decision of public respondent Commission in Case No. RAB-VII-01 70-83
upon the ground that the Labor Arbiter and the Commission have no
jurisdiction
over
the
subject
matter
of
the
case.chanroblesvirtualawlibrary chanrobles virtual law library
The jurisdiction of Labor Arbiters and the National Labor Relations
Commission is outlined in Article 217 of the Labor Code, as last amended by
Batas Pambansa Blg. 227 which took effect on 1 June 1982:
ART. 217. Jurisdiction of Labor Arbiters and the commission. (a) The Labor
Arbiters shall have the original and exclusive jurisdiction to hear and decide
within thirty (30) working days after submission of the case by the parties
for decision, the following cases involving are workers, whether agricultural
or non-agricultural:
1. Unfair labor practice cases; chanrobles virtual law library
2. Those that workers may file involving wages, hours of work and other
terms and conditions of employment; chanrobles virtual law library
3. All money claims of workers, including those based on non-payment or
underpayment of wages, overtime compensation, separation pay and other
benefits provided by law or appropriate agreement, except claims for
maternity
of vehicles and parts sold to him. Those accounts have no relevance to the
Labor Code. The cause of action was one under the civil laws, and it does
not breach any provision of the Labor Code or the contract of employment of
DEFENDANT. Hence the civil courts, not the Labor Arbiters and the NLRC
should have jurisdiction. 8
It seems worth noting that Medina v. Castro-Bartolome, referred to in the
above excerpt, involved a claim for damages by two (2) employees against
the employer company and the General Manager thereof, arising from the
use of slanderous language on the occasion when the General Manager fired
the two (2) employees (the Plant General Manager and the Plant
Comptroller). The Court treated the claim for damages as "a simple action
for damages for tortious acts" allegedly committed by private respondents,
clearly if impliedly suggesting that the claim for damages did not necessarily
arise
out
of
or
in
connection
with
the
employer-employee
relationship. Singapore Airlines Limited v. Pao, also cited inMolave,
involved a claim for LIQUIDATED damages not by a worker but by the
employer company, unlike Medina. The important principle that runs through
these three (3) cases is that where the claim to the principal relief
sought 9 is to be resolved not by reference to the Labor Code or other labor
relations statute or a collective bargaining agreement but by the general civil
law, the jurisdiction over the dispute belongs to the regular courts of justice
and not to the Labor Arbiter and the NLRC. In such situations, resolution of
the dispute requires expertise, not in labor management relations nor in
wage structures and other terms and conditions of employment, but rather
in the application of the general civil law. Clearly, such claims fall outside the
area of competence or expertise ordinarily ascribed to Labor Arbiters and the
NLRC and the rationale for granting jurisdiction over such claims to these
agencies disappears.chanroblesvirtualawlibrary chanrobles virtual law library
Applying the foregoing to the instant case, the Court notes that the SMC
Innovation Program was essentially an invitation from petitioner Corporation
to its employees to submit innovation proposals, and that petitioner
Corporation undertook to grant cash awards to employees who accept such
invitation and whose innovation suggestions, in the judgment of the
Corporation's officials, satisfied the standards and requirements of the
Innovation Program 10 and which, therefore, could be translated into some
substantial benefit to the Corporation. Such undertaking, though unilateral in
origin, could nonetheless ripen into an enforceable contractual (facio ut
MEDIALDEA, J.:
This petition seeks to nullify: 1) the order of respondent Labor Arbiter Potenciano Caizares dated August 6, 1991
deferring the resolution of the motion to dismiss the complaint of private respondents filed by petitioner Sanyo
Philippines Workers Union-PSSLU Local Chapter No. 109 (PSSLU, for brevity) on the ground that the labor arbiter
had no jurisdiction over said complaint and 2) the order of the same respondent clarifying its previous order and ruling
that it had jurisdiction over the case.
The facts of the case are as follows:
PSSLU had an existing CBA with Sanyo Philippines Inc. (Sanyo, for short) effective July 1, 1989 to June 30, 1994.
The same CBA contained a union security clause which provided:
Sec. 2. All members of the union covered by this agreement must retain their membership in good
standing in the union as condition of his/her continued employment with the company. The union
shall have the right to demand from the company the dismissal of the members of the union by
reason of their voluntary resignation from membership or willful refusal to pay the Union Dues or by
reasons of their having formed, organized, joined, affiliated, supported and/or aided directly or
indirectly another labor organization, and the union thus hereby guarantees and holds the company
free and harmless from any liability whatsoever that may arise consequent to the implementation of
the provision of this article. (pp. 5-6, Rollo)
In a letter dated February 7, 1990, PSSLU, through its national president, informed the management of Sanyo that
the following employees were notified that their membership with PSSLU were cancelled for anti-union, activities,
economic sabotage, threats, coercion and intimidation, disloyalty and for joining another union: Benito Valencia,
Bernardo Yap, Arnel Salvo, Renato Baybon, Eduardo Porlaje, Salvador Solibel, Conrado Sarol, Angelito Manzano,
Allan Misterio, Reynaldo Ricohermoso, Mario Ensay and Froilan Plamenco. The same letter informed Sanyo that the
same employees refused to submit themselves to the union's grievance investigation committee (p. 53, Rollo). It
appears that many of these employees were not members of PSSLU but of another union, KAMAO.
On February 14, 1990, some officers of KAMAO, which included Yap, Salvo, Baybon, Solibel, Valencia, Misterio and
Ricohermoso, executed a pledged of cooperation with PSSLU promising cooperation with the latter union and among
others, respecting, accepting and honoring the CBA between Sanyo and specifically:
1. That we shall remain officers and members of KAMAO until we finally decide to rejoin Sanyo
Phil. Workers Union-PSSLU;
2. That henceforth, we support and cooperate with the duly elected union officers of Sanyo Phil.
Workers Union-PSSLU in any and all its activities and programs to insure industrial peace and
harmony;
3. That we collectively accept, honor, and respect the Collective Bargaining Agreement entered into
between Sanyo Phil. Inc. and Sanyo Phil. Workers Union-PSSLU dated February 7, 1990;
4 That we collectively promise not to engage in any activities inside company premises contrary to
law, the CBA and existing policies;
5 That we are willing to pay our individual agency fee in accordance with the provision of the Labor
Code, as amended;
6 That we collectively promise not to violate this pledge of cooperation. (p. 55, Rollo)
On March 4, 1991, PSSLU through its national and local presidents, wrote another letter to Sanyo recommending the
dismissal of the following non-union workers: Bernardo Yap, Arnel Salvo, Renato Baybon, Reynaldo Ricohermoso,
Salvador Solibel, Benito Valencia, and Allan Misterio, allegedly because: 1) they were engaged and were still
engaging in anti-union activities; 2) they willfully violated the pledge of cooperation with PSSLU which they signed
and executed on February 14, 1990; and 3) they threatened and were still threatening with bodily harm and even
death the officers of the union (pp. 37-38, Rollo).
Also recommended for dismissal were the following union members who allegedly joined, supported and
sympathized with a minority union, KAMAO: Gerardo Lasala, Legardo Tangkay, Alexander Atanacio, and Leonardo
Dionisio.
On May 20, 1991, the dismissed employees filed a complaint (pp. 32-35, Rollo) with the NLRC for illegal dismissal.
Named respondent were PSSLU and Sanyo.
On June 20, 1991, PSSLU filed a motion to dismiss the complaint alleging that the Labor Arbiter was without
jurisdiction over the case, relying on Article 217 (c) of P.D. 442, as amended by Section 9 of Republic Act No. 6715
which provides that cases arising from the interpretation or implementation of the collective bargaining agreements
shall be disposed of by the labor arbiter by referring the same to the grievance machinery and voluntary arbitration.
The complainants opposed the motion to dismiss complaint on these grounds: 1) the series of conferences before the
National Conciliation and Mediation Board had been terminated; 2) the NLRC Labor Arbiter had jurisdiction over the
case which was a termination dispute pursuant to Article 217 (2) of the Labor Code; and 3) there was nothing in the
CBA which needs interpretation or implementation (pp. 44-46, Rollo).
On August 7, 1991, the respondent Labor Arbiter issued the first questioned order. It held that:
xxx xxx xxx
While there are seemingly contradictory provisions in the aforecited article of the Labor Code, the
better interpretation will be to give effect to both, and termination dispute being clearly spelled as
falling under the jurisdiction of the Labor Arbiter, the same shall be respected. The jurisdiction of the
grievance machinery and voluntary arbitration shall cover other controversies.
However, the resolution of the instant issue shall be suspended until both parties have fully
presented their respective positions and the said issue shall be included in the final determination
of the above-captioned case.
WHEREFORE, the instant Motions to Dismiss are hereby held pending.
Consequently, the parties are hereby directed to submit their position papers and supporting
documents pursuant to Section 2, Rule VII of the Rules of the Commission on or before the hearing
on the merit of this case scheduled on August 29, 1991 at 11:00 a.m. (p. 23, Rollo)
On August 27, 1991, PSSLU filed another motion to resolve motion to dismiss complaint with a prayer that the Labor
Arbiter resolve the issue of jurisdiction.
On September 4, 1991, the respondent Labor Arbiter issued the second questioned order which held that it was
assuming jurisdiction over the complaint of private respondents, in effect, holding that it had jurisdiction over the case.
On September 19, 1991, PSSLU filed this petition alleging that public respondent Labor Arbiter cannot assume
jurisdiction over the complaint of public respondents because it had no jurisdiction over the dispute subject of said
complaint. It is their submission that under Article 217 (c) of the Labor Code, in relation to Article 261 thereof, as well
as Policy Instruction No. 6 of the Secretary of Labor, respondent Arbiter has no jurisdiction and authority to take
cognizance of the complaint brought by private respondents which involves the implementation of the union security
clause of the CBA. The function of the Labor Arbiter under the same law and rule is to refer this case to the grievance
machinery and voluntary arbitration.
In its comment, private respondents argue that Article 217(a) 2 and 4 of the Labor Code is explicit, to wit:
Art. 217. Jurisdiction of the Labor Arbiters and the Commission.
a) Except as otherwise provided under this Code, the Labor Arbiters shall have original and
exclusive jurisdiction to hear and decide . . . the following cases involving all workers, . . . :
(b) The Commission shall have exclusive appellate jurisdiction over all cases decided by Labor
Arbiters.
(c) Cases arising from the interpretation or implementation of collective bargaining agreements and
those arising from the interpretation or enforcement of company personnel policies shall be
disposed of by the Labor Arbiter by referring the same to the grievance machinery and voluntary
arbitration as may be provided in said agreements.
It is clear from the above article that termination cases fall under the jurisdiction of the Labor Arbiter. It should be
noted however that said article at the outset excepted from the said provision cases otherwise provided for in other
provisions of the same Code, thus the phrase "Except as otherwise provided under this Code . . . ." Under paragraph
(c) of the same article, it is expressly provided that "cases arising from the interpretation or implementation of
collective bargaining agreements and those arising from the interpretation and enforcement of company personnel
policies shall be disposed of by the Labor Arbiter by referring the same to the grievance machinery and voluntary
arbitration as may be provided in said agreements.
It was provided in the CBA executed between PSSLU and Sanyo that a member's voluntary resignation from
membership, willful refusal to pay union dues and his/her forming, organizing, joining, supporting, affiliating or aiding
directly or indirectly another labor union shall be a cause for it to demand his/her dismissal from the company. The
demand for the dismissal and the actual dismissal by the company on any of these grounds is an enforcement of the
union security clause in the CBA. This act is authorized by law provided that enforcement should not be characterized
by arbitrariness (Manila Mandarin Employee Union v. NLRC, G.R. No. 76989, 29 Sept. 1987, 154 SCRA 368) and
always with due process (Tropical Hut Employees Union v. Tropical Food Market, Inc., L-43495-99, Jan. 20, 1990).
The reference to a Grievance Machinery and Voluntary Arbitrators for the adjustment or resolution of grievances
arising from the interpretation or implementation of their CBA and those arising from the interpretation or enforcement
of company personnel policies is mandatory. The law grants to voluntary arbitrators original and exclusive
jurisdiction to hear and decide all unresolved grievances arising from the interpretation or implementation of the
Collective Bargaining Agreement and those arising from the interpretation or enforcement of company personnel
policies (Art. 261, Labor Code).
In its order of September 4, 1991, respondent Labor Arbiter explained its decision to assume jurisdiction over the
complaint, thus:
The movants failed to show (1) the provisions of the CBA to be implemented, and (2) the grievance
machinery and voluntary arbitrator already formed and properly named. What self-respecting judge
would refer a case from his responsibility to a shadow? To whom really and specifically shall the
case be indorsed or referred? In brief, they could have shown the (1) existence of the grievance
machinery and (2) its being effective.
Furthermore, the aforecited law merely directs the "referral" cases. It does not expressly confer
jurisdiction on the grievance machinery or voluntary arbitration panel, created or to be created.
Article 260 of the Labor Code describes the formation of the grievance and voluntary arbitration. All
this of course shall be on voluntary basis. Is there another meaning of voluntary arbitration? (The
herein complainant have strongly opposed the motion to dismiss. Would they go willingly to the
grievance machinery and voluntary arbitration which are installed by their opponents if directed to
do so?) (p. 26, Rollo)
The failure of the parties to the CBA to establish the grievance machinery and its unavailability is not an excuse for
the Labor Arbiter to assume jurisdiction over disputes arising from the implementation and enforcement of a provision
in the CBA. In the existing CBA between PSSLU and Sanyo, the procedure and mechanics of its establishment had
been clearly laid out as follows:
dispose and refer the same to the grievance machinery or voluntary arbitration provided in the
Collective Bargaining Agreement.
In the instant case, however, We hold that the Labor Arbiter and not the Grievance Machinery provided for in the CBA
has the jurisdiction to hear and decide the complaints of the private respondents. While it appears that the dismissal
of the private respondents was made upon the recommendation of PSSLU pursuant to the union security clause
provided in the CBA, We are of the opinion that these facts do not come within the phrase "grievances arising from
the interpretation or implementation of (their) Collective Bargaining Agreement and those arising from the
interpretation or enforcement of company personnel policies," the jurisdiction of which pertains to the Grievance
Machinery or thereafter, to a voluntary arbitrator or panel of voluntary arbitrators. Article 260 of the Labor Code on
grievance machinery and voluntary arbitrator states that "(t)he parties to a Collective Bargaining Agreement shall
include therein provisions that will ensure the mutual observance of its terms and conditions. They shall establish a
machinery for the adjustment and resolution of grievances arising from the interpretation or implementation of their
Collective Bargaining Agreement and those arising from the interpretation or enforcement of company personnel
policies." It is further provided in said article that the parties to a CBA shall name or designate their respective
representatives to the grievance machinery and if the grievance is not settled in that level, it shall automatically be
referred to voluntary arbitrators (or panel of voluntary arbitrators) designated in advance by the parties. It need not be
mentioned that the parties to a CBA are the union and the company. Hence, only disputes involving the union and the
company shall be referred to the grievance machinery or voluntary arbitrators.
In the instant case, both the union and the company are united or have come to an agreement regarding the
dismissal of private respondents. No grievance between them exists which could be brought to a grievance
machinery. The problem or dispute in the present case is between the union and the company on the one hand and
some union and non-union members who were dismissed, on the other hand. The dispute has to be settled before an
impartial body. The grievance machinery with members designated by the union and the company cannot be
expected to be impartial against the dismissed employees. Due process demands that the dismissed workers
grievances be ventilated before an impartial body. Since there has already been an actual termination, the matter falls
within the jurisdiction of the Labor Arbiter.
ACCORDINGLY, the petition is DISMISSED. Public respondent Labor Arbiter is directed to resolve the complaints of
private respondents immediately.
SO ORDERED.
personality to represent said workers for purposes of collective bargaining. The SOLICITOR
General agrees with the position of SanMig.
The antecedents of the controversy reveal that:
Sometime in 1983 and 1984, SanMig entered into contracts for merchandising services with
Lipercon and D'Rite (Annexes K and I, SanMig's Comment, respectively). These companies are
independent contractors duly licensed by the Department of Labor and Employment (DOLE).
SanMig entered into those contracts to maintain its competitive position and in keeping with the
imperatives of efficiency, business expansion and diversity of its operation. In said contracts, it was
expressly understood and agreed that the workers employed by the contractors were to be paid by
the latter and that none of them were to be deemed employees or agents of SanMig. There was to
be no employer-employee relation between the contractors and/or its workers, on the one hand, and
SanMig on the other.
Petitioner San Miguel Corporation Employees Union-PTWGO (the Union, for brevity) is the duly
authorized representative of the monthly paid rank-and-file employees of SanMig with whom the
latter executed a Collective Bargaining Agreement (CBA) effective 1 July 1986 to 30 June 1989
(Annex A, SanMig's Comment). Section 1 of their CBA specifically provides that "temporary,
probationary, or contract employees and workers are excluded from the bargaining unit and,
therefore, outside the scope of this Agreement."
In a letter, dated 20 November 1988 (Annex C, Petition), the Union advised SanMig that some
Lipercon and D'Rite workers had signed up for union membership and sought the regularization of
their employment with SMC. The Union alleged that this group of employees, while appearing to be
contractual workers supposedly independent contractors, have been continuously working for
SanMig for a period ranging from six (6) months to fifteen (15) years and that their work is neither
casual nor seasonal as they are performing work or activities necessary or desirable in the usual
business or trade of SanMig. Thus, it was contended that there exists a "labor-only" contracting
situation. It was then demanded that the employment status of these workers be regularized.
On 12 January 1989 on the ground that it had failed to receive any favorable response from
SanMig, the Union filed a notice of strike for unfair labor practice, CBA violations, and union busting
(Annex D, Petition).
On 30 January 1989, the Union again filed a second notice of strike for unfair labor
practice (Annex F, Petition).
As in the first notice of strike. Conciliatory meetings were held on the second notice. Subsequently,
the two (2) notices of strike were consolidated and several conciliation conferences were held to
settle the dispute before the National Conciliation and Mediation Board (NCMB) of DOLE (Annex G,
Petition).
Beginning 14 February 1989 until 2 March 1989, series of pickets were staged by Lipercon and
D'Rite workers in various SMC plants and offices.
On 6 March 1989, SMC filed a verified Complaint for Injunction and Damages before respondent
Court to enjoin the Union from:
a. representing and/or acting for and in behalf of the employees of LIPERCON and/or
D'RITE for the purposes of collective bargaining;
b. calling for and holding a strike vote, to compel plaintiff to hire the employees or
workers of LIPERCON and D'RITE;
c. inciting, instigating and/or inducing the employees or workers of LIPERCON and
D'RITE to demonstrate and/or picket at the plants and offices of plaintiff within
the bargaining unit referred to in the CBA,...;
d. staging a strike to compel plaintiff to hire the employees or workers of LIPERCON
and D'RITE;
e. using the employees or workers of LIPERCON AND D'RITE to man the strike area
and/or picket lines and/or barricades which the defendants may set up at the plants
and offices of plaintiff within the bargaining unit referred to in the CBA ...;
f. intimidating, threatening with bodily harm and/or molesting the other employees
and/or contract workers of plaintiff, as well as those persons lawfully transacting
business with plaintiff at the work places within the bargaining unit referred to in the
CBA, ..., to compel plaintiff to hire the employees or workers of LIPERCON and
D'RITE;
g. blocking, preventing, prohibiting, obstructing and/or impeding the free ingress to,
and egress from, the work places within the bargaining unit referred to in the CBA ..,
to compel plaintiff to hire the employees or workers of LIPERCON and D'RITE;
h. preventing and/or disrupting the peaceful and normal operation of plaintiff at the
work places within the bargaining unit referred to in the CBA, Annex 'C' hereof, to
compel plaintiff to hire the employees or workers of LIPERCON and D'RITE. (Annex
H, Petition)
Respondent Court found the Complaint sufficient in form and substance and issued a Temporary
Restraining Order for the purpose of maintaining the status quo, and set the application for Injunction
for hearing.
In the meantime, on 13 March 1989, the Union filed a Motion to Dismiss SanMig's Complaint on the
ground of lack of jurisdiction over the case/nature of the action, which motion was opposed by
SanMig. That Motion was denied by respondent Judge in an Order dated 11 April 1989.
After several hearings on SanMig's application for injunctive relief, where the parties presented both
testimonial and documentary evidence on 25 March 1989, respondent Court issued the questioned
Order (Annex A, Petition) granting the application and enjoining the Union from Committing the acts
complained of, supra. Accordingly, on 29 March 1989, respondent Court issued the corresponding
Writ of Preliminary Injunction after SanMig had posted the required bond of P100,000.00 to answer
for whatever damages petitioners may sustain by reason thereof.
In issuing the Injunction, respondent Court rationalized:
The absence of employer-employee relationship negates the existence of labor
dispute. Verily, this court has jurisdiction to take cognizance of plaintiff's grievance.
The evidence so far presented indicates that plaintiff has contracts for services with
Lipercon and D'Rite. The application and contract for employment of the defendants'
witnesses are either with Lipercon or D'Rite. What could be discerned is that there is
no employer-employee relationship between plaintiff and the contractual workers
employed by Lipercon and D'Rite. This, however, does not mean that a final
determination regarding the question of the existence of employer-employee
relationship has already been made. To finally resolve this dispute, the court must
extensively consider and delve into the manner of selection and engagement of the
putative employee; the mode of payment of wages; the presence or absence of a
power of dismissal; and the Presence or absence of a power to control the putative
employee's conduct. This necessitates a full-blown trial. If the acts complained of are
not restrained, plaintiff would, undoubtedly, suffer irreparable damages. Upon the
other hand, a writ of injunction does not necessarily expose defendants to irreparable
damages.
Evidently, plaintiff has established its right to the relief demanded. (p. 21, Rollo)
Anchored on grave abuse of discretion, petitioners are now before us seeking nullification of the
challenged Writ. On 24 April 1989, we issued a Temporary Restraining Order enjoining the
implementation of the Injunction issued by respondent Court. The Union construed this to mean that
"we can now strike," which it superimposed on the Order and widely circulated to entice the Union
membership to go on strike. Upon being apprised thereof, in a Resolution of 24 May 1989, we
required the parties to "RESTORE the status quo ante declaration of strike" (p. 2,62 Rollo).
In the meantime, however, or on 2 May 1989, the Union went on strike. Apparently, some of the
contractual workers of Lipercon and D'Rite had been laid off. The strike adversely affected thirteen
(13) of the latter's plants and offices.
On 3 May 1989, the National Conciliation and Mediation Board (NCMB) called the parties to
conciliation. The Union stated that it would lift the strike if the thirty (30) Lipercon and D'Rite
employees were recalled, and discussion on their other demands, such as wage distortion and
appointment of coordinators, were made. Effected eventually was a Memorandum of Agreement
between SanMig and the Union that "without prejudice to the outcome of G.R. No. 87700 (this case)
and Civil Case No. 57055 (the case below), the laid-off individuals ... shall be recalled effective 8
May 1989 to their former jobs or equivalent positions under the same terms and conditions prior to
"lay-off" (Annex 15, SanMig Comment). In turn, the Union would immediately lift the pickets and
return to work.
After an exchange of pleadings, this Court, on 12 October 1989, gave due course to the Petition and
required the parties to submit their memoranda simultaneously, the last of which was filed on 9
January 1990.
The focal issue for determination is whether or not respondent Court correctly assumed jurisdiction
over the present controversy and properly issued the Writ of Preliminary Injunction to the resolution
of that question, is the matter of whether, or not the case at bar involves, or is in connection with, or
relates to a labor dispute. An affirmative answer would bring the case within the original and
exclusive jurisdiction of labor tribunals to the exclusion of the regular Courts.
Petitioners take the position that 'it is beyond dispute that the controversy in the court a quo involves
or arose out of a labor dispute and is directly connected or interwoven with the cases pending with
the NCMB-DOLE, and is thus beyond the ambit of the public respondent's jurisdiction. That the acts
complained of (i.e., the mass concerted action of picketing and the reliefs prayed for by the private
respondent) are within the competence of labor tribunals, is beyond question" (pp. 6-7, Petitioners'
Memo).
On the other hand, SanMig denies the existence of any employer-employee relationship and
consequently of any labor dispute between itself and the Union. SanMig submits, in particular, that
"respondent Court is vested with jurisdiction and judicial competence to enjoin the specific type of
strike staged by petitioner union and its officers herein complained of," for the reasons that:
A. The exclusive bargaining representative of an employer unit cannot strike to
compel the employer to hire and thereby create an employment relationship with
contractual workers, especially were the contractual workers were recognized by the
union, under the governing collective bargaining agreement, as excluded from, and
therefore strangers to, the bargaining unit.
B. A strike is a coercive economic weapon granted the bargaining representative only
in the event of a deadlock in a labor dispute over 'wages, hours of work and all other
and of the employment' of the employees in the unit. The union leaders cannot
instigate a strike to compel the employer, especially on the eve of certification
elections, to hire strangers or workers outside the unit, in the hope the latter will help
re-elect them.
C. Civil courts have the jurisdiction to enjoin the above because this specie of strike
does not arise out of a labor dispute, is an abuse of right, and violates the employer's
constitutional liberty to hire or not to hire. (SanMig's Memorandum, pp. 475-476,
Rollo).
We find the Petition of a meritorious character.
A "labor dispute" as defined in Article 212 (1) of the Labor Code includes "any controversy or matter
concerning terms and conditions of employment or the association or representation of persons in
negotiating, fixing, maintaining, changing, or arranging the terms and conditions of employment,
regardless of whether the disputants stand in the proximate relation of employer and employee."
While it is SanMig's submission that no employer-employee relationship exists between itself, on the
one hand, and the contractual workers of Lipercon and D'Rite on the other, a labor dispute can
nevertheless exist "regardless of whether the disputants stand in the proximate relationship of
employer and employee" (Article 212 [1], Labor Code,supra) provided the controversy concerns,
among others, the terms and conditions of employment or a "change" or "arrangement" thereof
(ibid). Put differently, and as defined by law, the existence of a labor dispute is not negative by the
fact that the plaintiffs and defendants do not stand in the proximate relation of employer and
employee.
That a labor dispute, as defined by the law, does exist herein is evident. At bottom, what the Union
seeks is to regularize the status of the employees contracted by Lipercon and D'Rite in effect, that
they be absorbed into the working unit of SanMig. This matter definitely dwells on the working
relationship between said employees vis-a-vis SanMig. Terms, tenure and conditions of their
employment and the arrangement of those terms are thus involved bringing the matter within the
purview of a labor dispute. Further, the Union also seeks to represent those workers, who have
signed up for Union membership, for the purpose of collective bargaining. SanMig, for its part,
resists that Union demand on the ground that there is no employer-employee relationship between it
and those workers and because the demand violates the terms of their CBA. Obvious then is that
representation and association, for the purpose of negotiating the conditions of employment are also
involved. In fact, the injunction sought by SanMig was precisely also to prevent such representation.
Again, the matter of representation falls within the scope of a labor dispute. Neither can it be denied
that the controversy below is directly connected with the labor dispute already taken cognizance of
by the NCMB-DOLE (NCMB-NCR- NS-01- 021-89; NCMB NCR NS-01-093-83).
Whether or not the Union demands are valid; whether or not SanMig's contracts with Lipercon and
D'Rite constitute "labor-only" contracting and, therefore, a regular employer-employee relationship
may, in fact, be said to exist; whether or not the Union can lawfully represent the workers of Lipercon
and D'Rite in their demands against SanMig in the light of the existing CBA; whether or not the
notice of strike was valid and the strike itself legal when it was allegedly instigated to compel the
employer to hire strangers outside the working unit; those are issues the resolution of which call
for the application of labor laws, and SanMig's cause's of action in the Court below are inextricably
linked with those issues.
The precedent in Layno vs. de la Cruz (G.R. No. L-29636, 30 April 1965, 13 SCRA 738) relied upon
by SanMig is not controlling as in that case there was no controversy over terms, tenure or
conditions, of employment or the representation of employees that called for the application of labor
laws. In that case, what the petitioning union demanded was not a change in working terms and
conditions, or the representation of the employees, but that its members be hired as stevedores in
the place of the members of a rival union, which petitioners wanted discharged notwithstanding the
existing contract of the arrastre company with the latter union. Hence, the ruling therein, on the basis
of those facts unique to that case, that such a demand could hardly be considered a labor dispute.
As the case is indisputably linked with a labor dispute, jurisdiction belongs to the labor tribunals. As
explicitly provided for in Article 217 of the Labor Code, prior to its amendment by R.A. No. 6715 on
21 March 1989, since the suit below was instituted on 6 March 1989, Labor Arbiters have original
and exclusive jurisdiction to hear and decide the following cases involving all workers including "1.
unfair labor practice cases; 2. those that workers may file involving wages, hours of work and other
terms and conditions of employment; ... and 5. cases arising from any violation of Article 265 of this
Code, including questions involving the legality of striker and lockouts. ..." Article 217 lays down the
plain command of the law.
The claim of SanMig that the action below is for damages under Articles 19, 20 and 21 of the Civil
Code would not suffice to keep the case within the jurisdictional boundaries of regular Courts. That
claim for damages is interwoven with a labor dispute existing between the parties and would have to
be ventilated before the administrative machinery established for the expeditious settlement of those
disputes. To allow the action filed below to prosper would bring about "split jurisdiction" which is
obnoxious to the orderly administration of justice (Philippine Communications, Electronics and
Electricity Workers Federation vs. Hon. Nolasco, L-24984, 29 July 1968, 24 SCRA 321).
We recognize the proprietary right of SanMig to exercise an inherent management prerogative and
its best business judgment to determine whether it should contract out the performance of some of
its work to independent contractors. However, the rights of all workers to self-organization,
collective bargaining and negotiations, and peaceful concerted activities, including the right to strike
in accordance with law (Section 3, Article XIII, 1987 Constitution) equally call for recognition and
protection. Those contending interests must be placed in proper perspective and equilibrium.
WHEREFORE, the Writ of certiorari is GRANTED and the Orders of respondent Judge of 25 March
1989 and 29 March 1989 are SET ASIDE. The Writ of Prohibition is GRANTED and respondent
Judge is enjoined from taking any further action in Civil Case No. 57055 except for the purpose of
dismissing it. The status quo ante declaration of strike ordered by the Court on 24 May 1989 shall be
observed pending the proceedings in the National Conciliation Mediation Board-Department of Labor
and Employment, docketed as NCMB-NCR-NS-01-02189 and NCMB-NCR-NS-01-093-83. No costs.
SO ORDERED.
That during his incumbency as such the defendant caused and without authority from
the plaintiff incurred accounts with the remaining balances in the total sum of
P33,890.38 excluding interests, arising from
the purchases of vehicles and parts,
repair jobs of his personal cars and
CASH ADVANCES ,
faithful reproductions of the Vehicle Invoice, Debit Memos, Deed of Absolute Sale,
Repair Orders, Charge Invoices, Vouchers, PROMISSORY NOTES ,
Acknowledgement Letter and Statement of Account, hereto attached and marked as
Annexes "A", "B", "C", "D", "E", "F", "G", "H", "I", "J", "K", "L", "M", and "N"
respectively and the contents of which being herein additionally pleaded and made
integral parts hereof; (Emphasis supplied)
In his Answer, DEFENDANT denied
... that he incurred any unpaid unauthorized accounts with the plaintiff in the total
sum of P33,890.38 excluding interests therefor, and,
specifically denies under oath that the annexed Vehicle Invoice, Debits Memos Deed
of Absolute Sale, Repair Orders, Charge Invoices, Vouchers, PROMISSORY NOTES
, Acknowledgement Letter and Statement of Account
have remained unpaid as in fact the truth of the matter is as follows, to wit:
(Emphasis supplied)
DEFENDANT further alleged in a counterclaim that he should still be considered an employee of
PLAINTIFF inasmuch as there has been no application for clearance in regards to his separation.
At the pre-trial conference, the DEFENDANT raised the question of jurisdiction of the Court stating
that PLAINTIFF's complaint arose out of employer-employee relationship, and he subsequently
moved for dismissal. It was then when respondent Judge dismissed the case finding that the sum
of money and damages sued upon arose from employer-employee relationship and that jurisdiction
belonged to the Labor Arbiter and the NLRC.
Before the enactment of BP Blg. 227 on June 1, 1982, Labor Arbiters, under paragraph 5 of Article
217 of the Labor Code had jurisdiction over "all other cases arising from employer-employee
relation, unless expressly excluded by this Code." Even then, the principle followed by this Court
was that, although a controversy is between an employer and an employee, the Labor Arbiters have
no jurisdiction if the Labor Code is not involved. In Medina vs. Castro-Bartolome, 116 SCRA 597,
604, in negating jurisdiction of the Labor Arbiter, although the parties were an employer and two
employees, Mr. Justice Abad Santos stated:
The pivotal question to Our mind is whether or not the Labor Code has any relevance
to the reliefs sought by the plaintiffs. For if the Labor Code has no relevance, any
discussion concerning the statutes amending it and whether or not they have
retroactive effect is unnecessary.
It is obvious from the complaint that the plaintiffs have not alleged any unfair labor
practice. Theirs is a simple action for damages for tortious acts allegedly committed
by the defendants. Such being the case, the governing statute is the Civil Code and
not the Labor Code. It results that the orders under review are based on a wrong
premise.
And in Singapore Airlines Limited vs. Pao, 122 SCRA 671, 677, the following was said:
Stated differently, petitioner seeks protection under the civil laws and claims no
benefits under the Labor Code. The primary relief sought is for LIQUIDATED
damages for breach of a contractual obligation. The other items demanded are not
labor benefits demanded by workers generally taken cognizance of in labor disputes,
such as payment of wages, overtime compensation or separation pay. The items
claimed are the natural consequences flowing from breach of an obligation,
intrinsically a civil dispute.
In the case below, PLAINTIFF had sued for monies LOANED to DEFENDANT, the cost of repair
jobs made on his personal cars, and for the purchase price of vehicles and parts sold to him. Those
accounts have no relevance to the Labor Code. The cause of action was one under the civil laws,
and it does not breach any provision of the Labor Code or the contract of employment of
DEFENDANT. Hence, the civil courts, not the Labor Arbiters and the NLRC, should have jurisdiction.
BP Blg. 227 has amended Article 217 of the Labor Code to read as follows:
ART. 217. Jurisdiction of Labor Arbiters and the Commission. (a) The Labor
Arbiters shall have the original and exclusive jurisdiction to hear and decide within
thirty (30) working days after submission of the case by the parties for decision, the
following cases involving all workers, whether agricultural or non-agricultural:
1. Unfair labor practice cases;
2. Those that ( involve) WORKERS MAY FILE INVOLVING wages, hours of work and
other terms andconditions of employment;
3. All money claims of workers, including those based on non-payment or
underpayment of wages, overtime compensation, separation pay and other benefits
provided by law or appropriate agreement, except claims for employees
compensation, social security, and maternity benefits;
4. Cases involving household services; and
GOD DAMN IT. YOU FUCKED ME UP ... YOU SHUT UP! FUCK YOU! YOU ARE
BOTH SHIT TO ME! YOU ARE FIRED (referring to Ernesto Medina). YOU TOO ARE
FIRED! '(referring to Jose Ong )
4. That on January 9, 1978, the herein plaintiffs filed a joint criminal complaint for oral
defamation against the defendant Cosme de Aboitiz duly supported with respective
affidavits and corroborated by the affidavits of two (2) witnesses: Isagani Hernandez
and Jose Ganseco II, but after conducting a preliminary investigation, Hon. Jose B.
Castillo, dismissed the complaint allegedly because the expression "Fuck you and
"You are both shit to me" were uttered not to slander but to express anger and
displeasure;
5. That on February 8, 1978, plaintiffs filed a Petition for Review with the office of the
Secretary of Justice (now Ministry of Justice) and on June 13, 1978, the Deputy
Minister of Justice, Catalino Macaraig, Jr., issued a resolution sustaining the plaintiff's
complaint, reversing the resolution of the Provincial Fiscal and directing him to file
against defendant Cosme de Aboitiz an information for Grave Slander. ... ;
6. That the employment records of plaintiffs show their track performance and
impeccable qualifications, not to mention their long years of service to the Company
which undoubtedly caused their promotion to the two highest positions in Muntinlupa
Plant having about 700 employees under them with Ernesto Medina as the Plant
General Manager receiving a monthly salary of P6,600.00 excluding other
perquisites accorded only to top executives and having under his direct supervision
other professionals like himself, including the plaintiff Jose G. Ong, who was the
Plant Comptroller with a basic monthly salary of P4,855.00;
7. That far from taking these matters into consideration, the defendant corporation,
acting through its President, Cosme de Aboitiz, dismissed and slandered the plaintiffs
in the presence of their subordinate employees although this could have been done
in private;
8. That the defendants have evidently enjoyed the act of dismissing the plaintiffs and
such dismissal was planned to make it as humiliating as possible because instead of
allowing a lesser official like the Regional Vice President to take whatever action was
necessary under the circumstances, Cosme de Aboitiz himself went to the
Muntinlupa Plant in order to publicly upbraid and dismiss the plaintiffs;
9. That the defendants dismissed the plaintiffs because of an alleged delay in the use
of promotional crowns when such delay was true with respect to the other Plants,
which is therefore demonstrative of the fact that Cosme de Aboitiz did not really have
a strong reason for publicly humiliating the plaintiffs by dismissing them on the spot;
10. That the defendants were moved by evil motives and an anti-social attitude in
dismissing the plaintiffs because the dismissal was effected on the very day that
plaintiffs were awarded rings of loyalty to the Company, five days before Christmas
and on the day when the employees' Christmas party was held in the Muntinlupa
Plant, so that when plaintiffs went home that day and found their wives and children
already dressed up for the party, they didn't know what to do and so they cried
unashamedly;
xxx xxx xxx
20. That because of the anti-social manner by which the plaintiffs were dismissed
from their employment and the embarrassment and degradation they experience in
the hands of the defendants, the plaintiffs have suffered and will continue to suffer
wounded feelings, sleepless nights, mental torture, besmirched reputation and other
similar injuries, for which the sum of P150,000.00 for each plaintiff, or the total
amount. of P300,000.00 should be awarded as moral damages;
21. That the defendants have demonstrated their lack of concern for the rights and
dignity of the Filipino worker and their callous disregard of Philippine labor and social
legislation, and to prevent other persons from following the footsteps of defendants,
the amount of P50,000.00 for each plaintiff, or the total sum of P100,000.00, should
be awarded as exemplary damages;
22. That plaintiffs likewise expect to spend no less than P5,000.00 as litigation
expenses and were constrained to secure the services of counsel for the protection
and enforcement of their rights for which they agreed to pay the sum of P10,000.00
and P200.00 per appearance as and for attorney's fees.
The complaint contains the following:
P R AY E R
WHEREFORE, in view of all the foregoing. it is most respectfully that after proper
notice and hearing, judgment be rendered for the plaintiffs and against the
defendants ordering them, jointly and solidarily, to pay the plaintiffs the sums of:
1. Unrealized income in such sum as will be established during the trial;
2. P300,000.00 as moral damages;
3. P100,000.00 by way of exemplary damages:
4. P5,000.00 as litigation expenses;
5. P10,000.00 and P200.00 per appearance as and for attorney's fees; and
6. Costs of this suit.
Plaintiffs also pray for such further reliefs and remedies as may be in keeping with
justice and equity.
On June 4, 1979, a motion to dismiss the complaint on the ground of lack of
jurisdiction was filed by the defendants. The trial court denied the motion on
September 6, 1979, in an order which reads as follows:
Up for resolution by the Court is the defendants' Motion to Dismiss dated June 4,
1979, which is basically anchored on whether or not this Court has jurisdiction over
the instant petition.
The complaint alleges that the plaintiffs' dismissal was without any provocation and
that defendant Aboitiz shouted and maliciously humiliated plaintiffs and used the
words quoted in paragraph 3 thereof. The plaintiffs further allege that they were
receiving salaries of P6,600.00 and P4,855.00 a month. So the complaint for civil
damages is clearly not based on an employer-employee relationship but on the
manner of plaintiffs' dismissal and the effects flowing therefrom. (Jovito N. Quisaba
vs, Sta. Ines-Melale Veneer & Plywood Co., Inc., et al., No. L-38088, Aug. 30,1974.)
This case was filed on May 10, 1979. The amendatory decree, P.D. 1367, which took
effect on May 1, 1978 and which provides that Regional Directors shall not indorse
and Labor Arbiters shall not entertain claims for moral or other forms of damages,
now expressly confers jurisdiction on the courts in these cases, specifically under the
plaintiff's causes of action.
Because of the letter dated January 4, 1978 and the statement of plaintiff Medina
that his receipt of the amount from defendant company was done "under strong
protest," it cannot be said that the demands set forth in the complaint have been
paid, waived or other extinguished. In fact, in defendants' Motion to Dismiss, it is
stated that 'in the absence of a showing that there was fraud, duress or violence
attending said transactions, such Release and Quitclaim Deeds are valid and binding
contracts between them, which in effect admits that plaintiffs can prove fraud,
violence, duress or violence. Hence a cause of action for plaintiffs exist.
It is noticed that the defamatory remarks standing alone per se had been made the
sole cause under the first cause of action, but it is alleged in connection with the
manner in which the plaintiffs had been dismissed, and whether the statute of
limitations would apply or not would be a matter of evidence.
IT has been alreadly settled by jurisprudence that mere asking for reinstatement
does not remove from the CFI jurisdiction over the damages. The case must involve
unfair labor practices to bring it within the jurisdiction of the CIR (now NLRC).
WHEREFORE, the defendants' Motion to Dismiss dated June 4, 1979 is hereby
denied.
The defendants are hereby directed to interpose their answer within ten (10) days
from receipt hereof.
While the trial was underway, the defendants filed a second motion to dismiss the complaint dated
January 23, 1981, because of amendments to the Labor Code immediately prior thereto. Acting on
the motion, the trial court issued on May 23, 1981, the following order:
Up for resolution by the Court is the defendants' Motion to Dismiss dated January 23,
1981, on grounds not existing when the first Motion to Dismiss dated June 4, 1979
was interposed. The ground relied upon is the promulgation of P.D. No. 1691
amending Art. 217 of the Labor Code of the Philippines and Batasan Pambansa
Bldg. 70 which took effect on May 1, 1980, amending Art. 248 of the Labor Code.
The Court agrees with defendants that the complaint alleges unfair labor practices
which under Art. 217 of the Labor Code, as amended by P.D. 1691, has vested
original and exclusive jurisdiction to Labor Arbiters, and Art. 248, thereof ... "which
may include claims for damages and other affirmative reliefs." Under the
amendment, therefore, jurisdiction over employee-employer relations and claims of
workers have been removed from the Courts of First Instance. If it is argued that this
case did not arise from employer-employee relation, but it cannot be denied that this
case would not have arisen if the plaintiffs had not been employees of defendant
Pepsi-Cola. Even the alleged defamatory remarks made by defendant Cosme de
Aboitiz were said to plaintiffs in the course of their employment, and the latter were
dismissed from such employment. Hence, the case arose from such employeremployee relationship which under the new Presidential Decree 1691 are under the
exclusive, original jurisdiction of the labor arbiters. The ruling of this Court with
respect to the defendants' first motion to dismiss, therefore, no longer holds as the
positive law has been subsequently issued and being a curative law, can be applied
retroactively (Garcia v. Martinez, et al., L-47629, May 28, 1979; 90 SCRA 331-333).
It will also logically follow that plaintiffs can reinterpose the same complaint with the
Ministry of Labor.
WHEREFORE, let this case be, as it is hereby ordered, dismissed, without
pronouncement as to costs.
A motion to reconsider the above order was filed on July 7, 1981, but it was only on February 8,
1982, or after a lapse of around seven (7) months when the motion was denied.
Plaintiffs have filed the instant petition pursuant to R. A. No. 5440 alleging that the respondent court
committed the following errors:
IN DIVESTING ITSELF OF ITS JURISDICTION TO HEAR AND DECIDE CIVIL
CASE NO. 33150 DESPITE THE FACT THAT JURISDICTION HAD ALREADY
ATTACHED WHICH WAS NOT OUSTED BY THE SUBSEQUENT ENACTMENT OF
PRESIDENTIAL DECREE 1691;
Separate Opinions
AQUINO, J.,dissenting:
I dissent with due deference to the opinion penned by Mr. Justice Abad Santos.
This case is about the jurisdiction of the Court of First Instance to entertain an action for damages
arising from the alleged disgraceful termination of petitioners' employment.
Ernesto Medina, the manager of the Muntinlupa plant of Pepsi-Cola Bottling Company of the
Philippines with a monthly salary of P6,600, and Jose G. Ong, Pepsi's controller in the same plant
with a monthly salary of P4,855, were summarily dismissed by Cosme de Aboitiz, Pepsi's president
and chief executive officer, on December 20, 1977 for having allegedly delayed the use of
promotional crowns (pp. 29-31, Rollo),
The two signed on January 5, 1978 letters of resignation and quitclaims and were paid P93,063 and
P84,386 as separation pay, respectively. However, before receiving those amounts, Medina and Ong
sent by registered mail to Aboitiz letters wherein they indicated that they objected to their illegal
dismissal and that they would sign the quitclaim and resignation papers "under protest" (pp. 32, 270275, Rollo).
More than a month after their dismissal, or on January 27, 1978, Medina and Ong filed with the
Ministry of Labor, a complaint for illegal dismissal. They prayed for reinstatement with full backwages
and, in the alternative, they prayed for additional separation pay of P72,904 for Medina and P35,927
for Ong (NLRC Case No. R4-STF-1-492-78, pp. 40, 288-299, Rollo).
The director of Region IV of the Ministry of Labor dismissed that complaint because of their
resignation and quitclaim. Medina and Ong appealed to the National Labor Relations Commission.
Deputy Minister Amado C. Inciong affirmed the dismissal in his order of April 23, 1979 (p. 246,
Rollo), He denied the motion for reconsideration of Medina and Ong in his Order of October 25,
1979 (p. 327, Rollo).
Seventeen days after that order of dismissal, or on May 10, 1979, Medina and Ong filed, in the Court
of First Instance of Rizal, Makati Branch XV an action for damages against Aboitiz and Pepsi-Cola
by reason of the humiliating manner in which they were dismissed. They prayed for the payment of
unrealized income and P415,000 as moral and exemplary damages, attorney's fees and litigation
expenses (pp. 34-5, 246, Rollo).
Aboitiz and Pepsi-Cola filed a motion to dismiss on the grounds of lack of jurisdiction, pendency of a
labor case, lack of cause of action, payment and prescription (p. 37, Rollo). Ong and Medina
opposed the motion.
Judge Floreliana Castro-Bartolome in her order of September 6, 1979 denied the motion to dismiss
on the ground that under Presidential Decree No. 1367, which took effect on May 1, 1979, the NLRC
and Labor Arbiters cannot entertain claims for moral or other damages, thus implying that such
claims should be ventilated in court (p. 247, Rollo).
After Medina had commenced his testimony, Aboitiz and Pepsi-Cola filed another motion to dismiss
based on Presidential Decree No. 1691, which took effect on May 1, 1980 and which repealed
Presidential Decree No. 1367 and restored to the NLRC and Labor Arbiters the jurisdiction to
adjudicate money claims of workers, including moral damages, and other claims arising from
employer- employee relationship.
Judge Bartolome in her order of May 23, 1981 dismissed the case for lack of jurisdiction. That order
of dismissal is assailed in this appeal by Medina and Ong under Republic Act No. 5440.
In my opinion the dismissal of the civil action for damages is correct because the claims of Medina
and Ong were within the exclusive jurisdiction of the Labor Arbiter and the NLRC, as originally
provided in article 217 of the Labor Code and as reaffirmed in Presidential Decree No. 1691. Medina
and Ong could not split their cause of action against Aboitiz and Pepsi-Cola. (See Aguda vs. Judge
Vallejos, G. R. No. 58133, March 26,1982; Ebon vs. Judge De Guzman, G. R. No. 58265, March 25,
1982; Cardinal Industries, Inc. vs. Vallejos, G. R. No. 57032, June 19, 1982; Pepsi-Cola Bottling Co.
vs. Martinez, G. R. No. 58877, March 15,1982.)
The decisions of the Regional Director and Deputy Minister Inciong are res judicata as to the claims
of Medina and Ong.
Separate Opinions
AQUINO, J.,dissenting:
I dissent with due deference to the opinion penned by Mr. Justice Abad Santos.
This case is about the jurisdiction of the Court of First Instance to entertain an action for damages
arising from the alleged disgraceful termination of petitioners' employment.
Ernesto Medina, the manager of the Muntinlupa plant of Pepsi-Cola Bottling Company of the
Philippines with a monthly salary of P6,600, and Jose G. Ong, Pepsi's controller in the same plant
with a monthly salary of P4,855, were summarily dismissed by Cosme de Aboitiz, Pepsi's president
and chief executive officer, on December 20, 1977 for having allegedly delayed the use of
promotional crowns (pp. 29-31, Rollo),
The two signed on January 5, 1978 letters of resignation and quitclaims and were paid P93,063 and
P84,386 as separation pay, respectively. However, before receiving those amounts, Medina and Ong
sent by registered mail to Aboitiz letters wherein they indicated that they objected to their illegal
dismissal and that they would sign the quitclaim and resignation papers "under protest" (pp. 32, 270275, Rollo).
More than a month after their dismissal, or on January 27, 1978, Medina and Ong filed with the
Ministry of Labor, a complaint for illegal dismissal. They prayed for reinstatement with full backwages
and, in the alternative, they prayed for additional separation pay of P72,904 for Medina and P35,927
for Ong (NLRC Case No. R4-STF-1-492-78, pp. 40, 288-299, Rollo).
The director of Region IV of the Ministry of Labor dismissed that complaint because of their
resignation and quitclaim. Medina and Ong appealed to the National Labor Relations Commission.
Deputy Minister Amado C. Inciong affirmed the dismissal in his order of April 23, 1979 (p. 246,
Rollo), He denied the motion for reconsideration of Medina and Ong in his Order of October 25,
1979 (p. 327, Rollo).
Seventeen days after that order of dismissal, or on May 10, 1979, Medina and Ong filed, in the Court
of First Instance of Rizal, Makati Branch XV an action for damages against Aboitiz and Pepsi-Cola
by reason of the humiliating manner in which they were dismissed. They prayed for the payment of
unrealized income and P415,000 as moral and exemplary damages, attorney's fees and litigation
expenses (pp. 34-5, 246, Rollo).
Aboitiz and Pepsi-Cola filed a motion to dismiss on the grounds of lack of jurisdiction, pendency of a
labor case, lack of cause of action, payment and prescription (p. 37, Rollo). Ong and Medina
opposed the motion.
Judge Floreliana Castro-Bartolome in her order of September 6, 1979 denied the motion to dismiss
on the ground that under Presidential Decree No. 1367, which took effect on May 1, 1979, the NLRC
and Labor Arbiters cannot entertain claims for moral or other damages, thus implying that such
claims should be ventilated in court (p. 247, Rollo).
After Medina had commenced his testimony, Aboitiz and Pepsi-Cola filed another motion to dismiss
based on Presidential Decree No. 1691, which took effect on May 1, 1980 and which repealed
Presidential Decree No. 1367 and restored to the NLRC and Labor Arbiters the jurisdiction to
adjudicate money claims of workers, including moral damages, and other claims arising from
employer- employee relationship.
Judge Bartolome in her order of May 23, 1981 dismissed the case for lack of jurisdiction. That order
of dismissal is assailed in this appeal by Medina and Ong under Republic Act No. 5440.
In my opinion the dismissal of the civil action for damages is correct because the claims of Medina
and Ong were within the exclusive jurisdiction of the Labor Arbiter and the NLRC, as originally
provided in article 217 of the Labor Code and as reaffirmed in Presidential Decree No. 1691. Medina
and Ong could not split their cause of action against Aboitiz and Pepsi-Cola. (See Aguda vs. Judge
Vallejos, G. R. No. 58133, March 26,1982; Ebon vs. Judge De Guzman, G. R. No. 58265, March 25,
1982; Cardinal Industries, Inc. vs. Vallejos, G. R. No. 57032, June 19, 1982; Pepsi-Cola Bottling Co.
vs. Martinez, G. R. No. 58877, March 15,1982.)
The decisions of the Regional Director and Deputy Minister Inciong are res judicata as to the claims
of Medina and Ong.
The orders of respondent judge dated June 20, 1996 and October 16, 1996,
taking jurisdiction over an action for damages filed by an employer against its
dismissed employee, are assailed in this petition for certiorari under Rule 65
of the Rules of Court for having been issued in grave abuse of discretion.
[1]
[3]
[4]
On January 30, 1996, petitioner filed a motion to dismiss the above complaint.
He interposed in the court below that the action for damages, having arisen
from an employer-employee relationship, was squarely under the exclusive
original jurisdiction of the NLRC under Article 217(a), paragraph 4 of the Labor
Code and is barred by reason of the final judgment in the labor case. He
accused private respondent of splitting causes of action, stating that the latter
could very well have included the instant claim for damages in its counterclaim
before the Labor Arbiter. He also pointed out that the civil action of private
respondent is an act of forum-shopping and was merely resorted to after a
failure to obtain a favorable decision with the NLRC. Scslx
Ruling upon the motion to dismiss, respondent judge issued the herein
questioned Order, which summarized the basis for private respondent's action
for damages in this manner: Slx
Paragraph 5 of the complaint alleged that the defendant violated
the plaintiffs policy re: His business in his branch at Iligan City
wherein defendant was the Sales Operations Manager, and
paragraph 7 of the same complaint briefly narrated the modus
operandi of defendant, quoted herein: Defendant canvassed
customers personally or through salesmen of plaintiff which were
hired or recruited by him. If said customer decided to buy items
from plaintiff on installment basis, defendant, without the
knowledge of said customer and plaintiff, would buy the items
on cash basis at ex-factory price, a privilege not given to
customers, and thereafter required the customer to
sign PROMISSORY NOTES and other documents using the
name and property of plaintiff, purporting that said customer
purchased the items from plaintiff on installment basis. Thereafter,
defendant collected the installment payments either personally
or through Venus Lozano, a Group Sales Manager of plaintiff but
also utilized by him as secretary in his own business for collecting
and receiving of installments, purportedly for the plaintiff but in
reality on his own account or business. The collection and receipt
of payments were made inside the Iligan City branch using
plaintiffs facilities, property and manpower. That accordingly
plaintiffs sales decreased and reduced to a considerable extent
the profits which it would have earned.
[5]
In declaring itself as having jurisdiction over the subject matter of the instant
controversy, respondent court stated: Mesm
A perusal of the complaint which is for damages does not ask for
any relief under the Labor Code of the Philippines. It seeks to
recover damages as redress for defendant's breach of his
contractual obligation to plaintiff who was damaged and
prejudiced. The Court believes such cause of action is within the
realm of civil law, and jurisdiction over the controversy belongs to
the regular courts.
While seemingly the cause of action arose from employeremployee relations, the employer's claim for damages is
grounded on the nefarious activities of defendant causing damage
and prejudice to plaintiff as alleged in paragraph 7 of the
complaint. The Court believes that there was a breach of a
contractual obligation, which is intrinsically a civil dispute. The
averments in the complaint removed the controversy from the
coverage of the Labor Code of the Philippines and brought it
within the purview of civil law. (Singapore Airlines, Ltd. Vs.
Pao, 122 SCRA 671.) xxx
[6]
Petitioner's motion for reconsideration of the above Order was denied for lack
of merit on October 16, 1996. Hence, this petition. Calrky
Acting on petitioner's prayer, the Second Division of this Court issued a
Temporary Restraining Order ("TRO ") on March 5, 1997, enjoining
respondents from further proceeding with Civil Case No. 95-554 until further
orders from the Court. Kycalr
By way of assignment of errors, the petition reiterates the grounds raised in
the Motion to Dismiss dated January 30, 1996, namely, lack of jurisdiction
over the subject matter of the action, res judicata, splitting of causes of action,
and forum-shopping. The determining issue, however, is the issue of
jurisdiction. Kyle
Article 217(a), paragraph 4 of the Labor Code, which was already in effect at
the time of the filing of this case, reads: Exsm
ART. 217. Jurisdiction of Labor Arbiters and the Commission. --(a) Except as otherwise provided under this Code the Labor
Arbiters shall have original and exclusive jurisdiction to hear and
decide, within thirty (30) calendar days after the submission of the
case by the parties for decision without extension, even in the
absence of stenographic notes, the following cases involving all
workers, whether agricultural or non-agricultural:
xxx
4. Claims for actual, moral, exemplary and other forms of
damages arising from the employer-employee relations;
xxx
The above provisions are a result of the amendment by Section 9 of Republic
Act ("R.A.") No. 6715, which took effect on March 21, 1989, and which put to
rest the earlier confusion as to who between Labor Arbiters and regular courts
had jurisdiction over claims for damages as between employers and
employees. Sppedjo
It will be recalled that years prior to R.A. 6715, jurisdiction over
all money claims of workers, including claims for damages, was originally
lodged with the Labor Arbiters and the NLRC by Article 217 of the Labor
Code. On May 1, 1979, however, Presidential Decree ("P.D.") No. 1367
amended said Article 217 to the effect that "Regional Directors shall not
indorse and Labor Arbiters shall not entertain claims for moral or other forms
of damages." This limitation in jurisdiction, however, lasted only briefly since
on May 1, 1980, P.D. No. 1691 nullified P.D. No. 1367 and restored Article 217
of the Labor Code almost to its original form. Presently, and as amended by
R.A. 6715, the jurisdiction of Labor Arbiters and the NLRC in Article 217 is
comprehensive enough to include claims for all forms of damages "arising
from the employer-employee relations". Miso
[7]
[8]
Even under Republic Act No. 875 (the "Industrial Peace Act", now completely
superseded by the Labor Code), jurisprudence was settled that where the
plaintiff's cause of action for damages arose out of, or was necessarily
intertwined with, an alleged unfair labor practice committed by the union, the
jurisdiction is exclusively with the (now defunct) Court of Industrial Relations,
and the assumption of jurisdiction of regular courts over the same is a nullity.
To allow otherwise would be "to sanction split jurisdiction, which is
prejudicial to the orderly administration of justice." Thus, even after the
enactment of the Labor Code, where the damages separately claimed by the
employer were allegedly incurred as a consequence of strike or picketing of
the union, such complaint for damages is deeply rooted from the labor dispute
between the parties, and should be dismissed by ordinary courts for lack of
jurisdiction. As held by this Court in National Federation of Labor vs.
Eisma, 127 SCRA 419: Manikx
[10]
[11]
Still on the prospect of re-opening factual issues already resolved by the labor
court, it may help to refer to that period from 1979 to 1980 when jurisdiction
over employment-predicated actions for damages vacillated from labor
tribunals to regular courts, and back to labor tribunals. In Ebon vs. de
Guzman, 113 SCRA 52, this Court discussed:
[13]
[15]
[16]
[17]
Neither can we uphold the reasoning of respondent court that because the
resolution of the issues presented by the complaint does not entail application
of the Labor Code or other labor laws, the dispute is intrinsically civil. Article
217(a) of the Labor Code, as amended, clearly bestows upon the Labor
Arbiter original and exclusive jurisdiction over claims for damages arising from
employer-employee relations ---in other words, the Labor Arbiter has
jurisdiction to award not only the reliefs provided by labor laws, but also
damages governed by the Civil Code.
[18]
Thus, it is obvious that private respondent's remedy is not in the filing of this
separate action for damages, but in properly perfecting an appeal from the
Labor Arbiter's decision. Having lost the right to appeal on grounds of
untimeliness, the decision in the labor case stands as a final judgment on the
merits, and the instant action for damages cannot take the place of such lost
appeal.
Respondent court clearly having no jurisdiction over private respondent's
complaint for damages, we will no longer pass upon petitioner's other
assignments of error. Ncm
WHEREFORE, the Petition is GRANTED, and the complaint in Civil Case No.
95-554 before Branch 39 of the Regional Trial Court of Misamis Oriental is
hereby DISMISSED. No pronouncement as to costs. Ncmmis
SO ORDERED.
On 31 July 1995, the Labor Arbiter, Ariel Cadiente Santos, arrived at a decision holding petitioners
guilty of constructive dismissal and ordering the reinstatement of the complainant to his former
position with full backwages from the date of his "dismissal" until his actual reinstatement; directing
the Research and Information Unit to compute the various monetary benefits awarded to the
complainant; and adjudging the payment, by way of attorneys fees, of ten percent (10%) of all sums
owing to the complainant.
On 16 October 1998, petitioners filed an appeal to the National Labor Relations Commission
(NLRC).
On 11 November 1998, the NLRC issued an order directing petitioners to submit an affidavit to the
effect that their appeal bond was genuine and that it would be in force and effect until the final
disposition of the case. In his reply memorandum, dated 28 November 1998, respondent,
asseverating that petitioners failed to deposit the required bond for the appeal, sought the appeal to
be declared as not having been validly perfected. On 19 January 1999, petitioners submitted a
manifestation and affidavit in compliance with the 11th November 1998 order of the
NLRC.1Apparently satisfied, the NLRC, on 30 April 1999, gave due course to the appeal and
rendered the presently assailed decision, reversing that of the Labor Arbiter, to wit:
WHEREFORE, the decision appealed from is hereby SET ASIDE. However, respondent
[before the NLRC] is hereby ordered to pay complainant separation pay computed at onehalf (1/2) month for every year of service, reckoned from date of employment on October 9,
1990 up to September 9, 1995, the date the complainant should have been redeployed." 2
A motion for reconsideration, filed by herein private respondent Valenzuela, was denied by the
NLRC.
Valenzuela forthwith brought the matter up to the Court of Appeals. On the thesis that the only issue
interposed was whether or not the NLRC committed grave abuse of discretion when it took
cognizance of the appeal and reversed the decision of the Labor Arbiter despite the failure of herein
petitioners to validly post the appeal bond, the appellate court responded in the affirmative, set aside
the assailed decision of the NLRC and reinstated that of the Labor Arbiter. A motion to reconsider the
decision was denied.
In the instant recourse before this Court, petitioners claim that the Court of Appeals (Eleventh
Division) has committed grave abuse of discretion amounting to lack or excess of jurisdiction in
declaring petitioners to have failed in perfecting their appeal with the NLRC.
This Court finds merit in the petition.
Private respondent would posit that the appeal of petitioners to the NLRC should be considered to
have been made on 19 January 1999 (when petitioner submitted, pursuant to the NLRC order, a
statement under oath to the effect that the surety bond it had posted was genuine and confirmed it to
be in effect until the final termination of the case) which was beyond the ten-day period for perfecting
an appeal. The records before the Court would show, however, that an appeal bond was posted with
the NLRC at the same time that the appeal memorandum of petitioners was filed on 16 October
1998. A certified true copy of the appeal bond3 would indicate that it was received by the
Commission on 16 October 1998, the date reflected by the stamp-mark thereon. The surety bond
issued by the Philippine Charter Insurance Corporation bore the date of 14 October 1998 or two
days before the appeal memorandum was seasonably filed on 16 October 1998. The Order,4 dated
11 November 1998, of the NLRC categorically stated that "records [would] disclose that the instant
appeal [was] accompanied by a surety bond, as the Decision sought to be appealed involved a
monetary award." The NLRC, in fact, ordered petitioner to submit an affidavit to confirm that its
appeal bond was genuine and would be in force and effect until the final disposition of the case. The
Commissions declaration that the appeal was accompanied by a surety bond indicated that there
had been compliance with Article 2235 of the Labor Code.
An appeal to the NLRC is perfected once an appellant files the memorandum of appeal, pays the
required appeal fee and, where an employer appeals and a monetary award is involved, the latter
posts an appeal bond or submits a surety bond issued by a reputable bonding company.6 In line with
the desired objective of labor laws to have controversies promptly resolved on their merits, the
requirements for perfecting appeals are given liberal interpretation and construction. 7
The only issue on the merits of the case is whether or not private respondent should be deemed
constructively dismissed by petitioner for having been placed on "floating status," i.e., with no
reassignment, for a period of 29 days. The question posed is not new. In the case of Superstar
Security Agency, Inc., vs. NLRC,8 this Court, addressing a similar issue, has said:
"x x x The charge of illegal dismissal was prematurely filed. The records show that a month
after Hermosa was placed on a temporary off-detail, she readily filed a complaint against
the petitioners on the presumption that her services were already terminated. Temporary offdetail is not equivalent to dismissal. In security parlance, it means waiting to be posted. It is
a recognized fact that security guards employed in a security agency may be temporarily
sidelined as their assignments primarily depend on the contracts entered into by the agency
with third parties (Agro Commercial Security Agencies, Inc. vs. NLRC, et al., G.R. Nos.
82823-24, 31 July 1989). However, it must be emphasized that such temporary inactivity
should continue only for six months. Otherwise, the security agency concerned could be
liable for constructive dismissal."9
Constructive dismissal exists when an act of clear discrimination, insensibility or disdain, on the part
of an employer has become so unbearable as to leave an employee with no choice but to forego
continued employment.10 The temporary "off-detail" of respondent Valenzuela is not such a case.
WHEREFORE, the instant petition is GRANTED. The assailed decision and resolution of the Court
of Appeals areSET ASIDE and the decision of the National Labor Relations Commission in NCR CN.
04-02620-95 isREINSTATED. No costs.
SO ORDERED.
QUISUMBING, J.:
This special civil action for certiorari seeks to annul the decision promulgated on July 29, 1993, by
public respondent in NLRC NCR Case No. 003279-92, and its resolution dated April 11, 1994, which
denied petitioner's motion for reconsideration.
Petitioners allege that they were jeepney drivers of private respondent Araceli Cornejo on boundary
system. They regularly ply the jeepneys assigned to them for eleven hours a day, five times a week
and each of the earn an average of P350.00 daily.
On April 20, 1991, when petitioners Rodento Navarro and Antonio Bocabal were about to get the
keys of their respective jeepneys, private respondent Olimpio Breton, the dispatcher, told them that
they cannot go out on the usual working hours of 5 PM to 4 AM (night shift) because their working
hours were moved to a new schedule of work, 7 PM to 6 AM. Expecting that the sudden change of
working hours will adversely affect their earnings, Navarro, Bocabal and seven other night shift
drivers decided not to ply their routes that day to protest the sudden change of working hours.
Petitioner Julian De Guzman reported to work as usual. However, he cut short his trip because he
allegedly felt dizzy and suffered stomach pain.
The following day, all the drivers who participated in the protest action were summoned by Breton
and were meted a one-day suspension but were asked to pay the boundary for April 20. However,
Breton promised to restore the night shift hours to 5 PM to 4 AM.
On April 23, 1991, petitioners were surprised to find somebody else were assigned to their
respective jeepneys. Breton told petitioners to look for work elsewhere, although the other drivers
who participated in the protest action were allowed to work.
For their part, private respondents claim that on April 20, 1991, at about 5:45 PM, Breton advised the
night shift drivers to take out the jeepneys at 7 PM. This action was made considering that the
regular hours were no longer observed by the drivers. Frequently, the jeepneys were no longer
checked-up because immediately after the day shift drivers return the jeepneys at around 6 PM, the
night shift drivers take them out without giving time for inspection. Because of this strict
implementation of time of work, the night shift drivers left the compound and convinced other drivers
to stop their operation. As a consequence, the jeepneys were not taken out that night resulting in the
loss of income to the operator.
On April 21, 1991, Breton met with the night shift drivers wherein they agreed that the working hours
starting the next day would be from 5 AM to 4 PM for the day shift, and 5 PM to 4 AM for the night
shift. Nonetheless, the night shift drivers were not able to drive their units on that day since Breton
advised the day shift and extra drivers to continue driving the units. This was a precautionary step in
the event the regular drivers would continue their strike as what happened in December 1990 when
all the drivers went on strike for five days.
Private respondents also claim that they were surprised petitioners never returned to work. Since
their business is imbued with public interest, extra drivers were made to drive the jeepneys assigned
to petitioners. They maintain that no new drivers were hired to replace petitioners. It was only on
June 7, 1991, after the first hearing of this complaint, when petitioners made clear their refusal to
return to work before the labor arbiter that replacements for them were hired. Private respondents
insist that petitioners were not dismissed but abandoned their work.
On May 15, 1991, petitioners filed before the Regional Arbitration Branch a complaint for illegal
dismissal. The minutes of the proceedings indicate that the counsel for private respondents informed
the labor arbiter of the willingness of private respondents to take petitioners back. Petitioners
reportedly turned down private respondents' offer since the drivers just want separation pay.
On June 28, 1991, petitioners amended their complaint in which they sought payment for severance
pay, backwages, with 12% legal interest per annum; P50,000.00 to each complainant for moral
damages; P50,000.00 as exemplary damages and P15,000.00 as attorney's fees.
On November 26, 1991, the labor arbiter rendered judgment in favor of petitioners and decreed as
follows:
WHEREFORE, premises considered, respondents are ordered to pay complainants:
RODENTO NAVARRO separation pay in the amount of P40,950.00 (9 yrs. P350 x 13 days x
9 yrs.); ANTONIO BOCABAL separation pay in the amount of P22,750.00 (5 yrs. P350.00 x
13 days x 5 yrs.) and JULIAN DE GUZMAN separation pay in the amount of P31,850.00 (7
yrs. P350.00 x 13 days x 7 yrs.) and the equivalent of 10% of the total monetary award as
attorney's fees in the amount of P9,555.00 (10% of 95,550.00).
SO ORDERED. 1
On April 3, 1992, private respondents were served a copy of the decision of the labor arbiter.
Aggrieved, they filed on April 13, 1992 with NLRC their memorandum on appeal. Nevertheless, it
was only on April 30, 1992, that private respondents filed the appeal bond. Unfortunately, the
aforesaid bond was later discovered to be spurious because the person who signed it was no longer
connected with the insurance company for more than ten years already. It was only on July 20,
1993, that private respondents posted a substitute bond issued by another company in the amount
of P95,550.00.
In a decision dated July 29, 1993, public respondent ruled for private respondents, thus:
WHEREFORE, premises considered, the appealed decision is hereby SET ASIDE and
another entered directing the complainants, under pain of losing their employment, to report
back to work within ten (10) days from receipt of this Decision.
SO ORDERED.2
Their motion for reconsideration having been denied, petitioners filed the instant petition imputing
grave abuse of discretion on the part of public respondent:
I
xxx
xxx
xxx
xxx
Perfection of an appeal includes the filing, within the prescribed period, of the memorandum of
appeal containing, among others, the assignment of error/s, arguments in support thereof, the relief
sought and, in appropriate cases, posting of the appeal bond. In case where the judgment involves a
monetary award, as in this case, the appeal may be perfected only upon posting of a cash or surety
bond issued by a reputable bonding company duly accredited by the NLRC. 5 The amount of the
bond must be equivalent to the monetary award, exclusive of moral and exemplary damages and
attorney's fees.
The records indicate that private respondents received the copy of labor arbiter's decision on April 3,
1992, hence, they had only until April 13, 1992 to perfect their appeal. While private respondents
filed their memorandum of appeal on time, they posted surety bond only on April 30, 1992, which is
beyond the ten-day reglementaty period, a procedural lapse admitted by private respondents.
Private respondents' failure to post the required appeal bond within the prescribed period is
inexcusable.6 Worse, the appeal bond was bogus having been issued by an officer no longer
connected for a long time with the bonding company. Unfortunately, this irregularity was not
sufficiently explained by private respondents. For sure, they cannot avoid responsibility by
disavowing any knowledge of its fictitiousness for they were required to secure bond only from
reputable companies. Corollary, they should have ensured that the bond is genuine, otherwise, the
purpose of requiring the posting of bond, that is, to guarantee the payment of valid and legal claims
against the employer, would not be served.
We are mindful of the fact that this Court, in a number of cases,7 has relaxed this requirement on
grounds of substantial justice and special circumstances of the case. However, we find no cogent
reason to apply this same liberal interpretation herein when the bond posted was not genuine. In this
case, there is really no bond posted since a fake or expired bond is in legal contemplation merely a
scrap of paper. It should be stressed that the intention of lawmakers to make the bond an
indispensable requisite for the perfection of an appeal by the employer is underscored by the
provision that an appeal by the employer may be perfected only upon the posting of a cash or surety
bond. The word "only" makes it perfectly clear that the lawmakers intended the posting of a cash or
surety bond by the employer to be the exclusive means by which an employer's appeal may be
perfected.8
1wphi1
As the appeal filed by private respondents was not perfected within the reglementary period, the
running of the prescriptive period for perfecting an appeal was not tolled. 9 Consequently, the decision
of the labor arbiter became final and executory upon the lapse of ten calendar days from receipt of
the decision. Hence, the decision became immutable and it can no longer be amended nor altered
by the labor tribunal. Accordingly, inasmuch as the timely posting of appeal bond is an indispensable
and jurisdictional requisite and not a mere technicality of law, the NLRC has no authority to entertain
the appeal, much less to set aside the decision of the labor arbiter in this case. Any amendment or
alteration made which substantially affects the final and executory judgment is null and void for lack
of jurisdiction, including the entire proceedings held for that purpose. 10
In view of the foregoing disposition, it is no longer necessary to discuss the other issues raised in
this petition.
WHEREFORE, the instant petition is GRANTED. The assailed Decision rendered on July 29, 1993,
by public respondent and its Resolution dated April 11, 1994, are SET ASIDE. The Decision of the
Labor Arbiter dated November 26, 1991, is hereby REINSTATED. Costs against private
respondents.
1wphi1.nt
SO ORDERED.
The petition for certiorari assails the Resolution of the National Labor
Relations Commission ("NLRC") dismissing the appeal of petitioner United
Placement International in POEA Case No. L-86-05-378-A & B for having
been interposed beyond the reglementary period.
Leonardo Arazas, Livy Dacillo and Cesar Hernandez, herein private
respondents, applied for overseas employment with Placementhaus and
General Services (Placementhaus for brevity). Virgilio Reyes of
Placementhaus informed the applicants that their deployment abroad could be
facilitated by completing the requisite documents and paying a placement fee
of P19,300.00 each. Hopeful, private respondents each paid the quoted
amount to Reyes. No receipt was issued.
On 09 November 1985, private respondents were made to sign twoyear employment contracts bearing the signature of the general manager,
Janet A. Gregorio, of Placementhaus. Only private respondent Dacillo,
however, was furnished with a copy of the agreement. Prior to their
departure, in December of 1986, for Dammam, Saudi Arabia, private
respondents were each provided with a sealed envelope with the instruction
that the envelopes were to be opened only if and when required by the
authorities to show their employment contracts at the port of destination. The
envelopes each contained a notice and confirmation of EMPLOYMENT
ISSUED by Luz R. Abad, manager of United Placement International, in
favor of private respondents.
After only a five-month stay in Saudi Arabia, or on 19 April 1986, private
respondents' employment contracts were pre-terminated, and they were sent
back to the Philippines.
Soon after their arrival, private respondents filed with the Philippine
Overseas Employment Administration ("POEA") their complaint for illegal
dismissal, nonpayment of bonus and a refund of placement fees against
Placementhaus and the United Placement International.
Corresponding summonses and notices were sent to petitioner for the
hearings scheduled for 03 July 1986, 15 July 1986, 07 August 1986, 11
August 1986, 03 September 1986, 12 September 1986, 19 September 1986,
HELD: No. An appellate court may only pass upon errors assigned, but
such without exceptions. An appellate court, as well as those in
(a) Grounds not assigned as errors but affecting the jurisdiction of the court over the
subject matter;
(b) Matters not assigned as errors on appeal but are evidently plain or clerical errors
within contemplation of law;
(c) Matters not assigned as errors on appeal but consideration of which is necessary in
arriving at a just decision and complete resolution of the case or to serve the interests of
a justice or to avoid dispensing piecemeal justice;
(d) Matters not specifically assigned as errors on appeal but raised in the trial court and
are matters of record having some bearing onthe issue submitted which the parties
failed to raise or which the lower court ignored;
(e) Matters not assigned as errors on appeal but closely related to an error assigned;
(f) Matters not assigned as errors on appeal but upon which the determination of a
question properly assigned, is dependent.
These rules also apply to administrative bodies and the instant controversy falls
squarely under the exceptions to the general rule.
Not only did petitioner fail to comply with Section 2, Rule VIII, Book V of the
Implementing Rules and Regulations of the Labor Code as amended neither did he
exhaust the remedies set forth by the Constitution and by-laws of both unions. In the
National Convention of PACIWU and NACUSIP nothing was heard of
petitioner'scomplaint against private respondents and in fact, what the National
Convention resolved was to approve and adopt the resolution of the National Executive
Board removing petitioner from the positions he held. His failure to seek recourse before
the National Convention on his complaint against private respondents taints his action
with prematurity.
When the CBL of both unions dictated the remedy for intra-union dispute, this should be
resorted to before recourse can be made to the appropriate administrative or judicial
body, not only to give the grievance machinery or appeals' body of the union the
opportunity to decide the matter by itself, but also to prevent unnecessary and
premature resort to administrative or judicial bodies.
Thus, a party with an administrative remedy must not merely initiate the prescribed
administrative procedure to obtain relief, but also pursue it to its appropriate conclusion
before seeking judicial intervention. The underlying principle of the rule on exhaustion of
administrative remedies rests on the presumption that when the administrative body, or
grievance machinery, as in this case, is afforded a chance to pass upon the matter, it
will decide the same correctly. Petitioner's premature invocation of public respondent's
intervention is fatal to his cause of action.
Evidently, when petitioner brought before the DOLE his complaint charging private
respondents he overlooked or deliberately ignored the fact that the same is clearly
dismissible for non-exhaustion of administrative remedies.
Acting on the matter, the company ruled to allow payment of unused vacation and sick leaves for
the period of 1987-1988 but disallowed cash conversion of the 1988-1989 unused leaves.
On January 3, 1990, the company issued suspension orders affecting twenty (20) employees for
failure to render overtime work on December 30, 1989. The suspension was for a period of three (3)
days effective January 3, 1996 to January 5, 1990.
On the same day, the union filed a notice of strike on the grounds of unfair labor
practice particularly the violation of the CBA provisions on non-payment of unused leaves and illegal
dismissal of seven (7) employees in November, 1989.
On January 13, 1990, the company issued a notice of termination to three (3) employees or union
members, namely, Cecile de Ocampo, Rene Villanueva and Marcelo dela Cruz, of the machinery
department, allegedly to effect cost reduction and redundancy.
The members of the union conducted a picket at the main gate of the company on January 18,
1990.
On the same day, the company filed a petition to declare the strike illegal with prayer for injunction
against the union, Cecile de Ocampo, Wilfredo San Pedro and Rene Aguilar.
An election of officers was conducted by the union on January 19, 1990. Consequently, Cecile de
Ocampo was elected as president.
During the conciliation meeting held at National Conciliation and Mediation Board (NCMB) on
January 22, 1990 relative to the notice of strike filed by the union on January 3, 1990, the issue
pertaining to the legality of the termination of three (3) union members was raised by the union.
However, both parties agreed to discuss it separately.
Subsequently, in a letter dated January 28, 1990, the union requested for the presence of a NCMB
representative during a strike vote held by the union. The strike vote resulted to 388 votes out of 415
total votes in favor of the strike.
Consequently, the union staged a strike on February 6, 1990.
On February 7, 1990, the company filed a petition to assume jurisdiction with the Department of
Labor and Employment.
On February 16, 1990, the company filed an amended petition, praying among other things, that the
strike staged by the union on February 6, 1990 be declared illegal, there being no genuine strikeable
issue and the violation of the no-strike clause of the existing CBA between the parties.
The Secretary of Labor in an order dated February 15, 1990, certified the entire labor dispute to the
respondent Commission for compulsory arbitration and directed all striking workers including the
dismissed employees to return to work and the management to accept them back.
The company filed an urgent motion for assignment of a sheriff to enforce the order of the Secretary.
In an order dated February 22, 1990, the Secretary of Labor directed Sheriff Alfredo Antonio, Jr., to
implement the order.
On February 23, 1990, the sheriff, with the assistance of the PC/INP of San Rafael, removed the
barricades and opened the main gate of the company.
Criminal complaints for illegal assembly, grave threats, and grave coercion were filed against Cecile
de Ocampo, Timoteo Mijares, Modesto Mamesia and Domingo Silarde by the local police authorities
on February 24, 1990.
On February 25, 1990, the company caused the publication of his return to work order in two (2)
newspapers, namely NGAYON and ABANTE.
In its letter dated February 27, 1990, the union, through its President Cecile de Ocampo, requested
the Regional Director of DOLE, Region III to intervene in the existing dispute with management.
Meanwhile, the company extended the February 26, 1990 deadline for the workers to return to work
until March 15, 1990.
The respondent Commission rendered a decision on October 23, 1990, declaring the strikes staged
on January 18, 1990 and February 6, 1990 illegal, the dispositive portion of which provides as
follows, to wit:
WHEREFORE, judgment is hereby rendered as follows:
1. The strike staged on January 18, 1990 is hereby declared illegal and all
employees who participated therein are reprimanded therefor or an further warned
that future similar acts shall be dealt moreseverely;
2. The strike staged on February 6, 1990 is hereby declared illegal and the Union
officers/members are deemed suspended from March 15, 1990 the last deadline of
the company for them to report to the date of promulgation of this Decision. In short,
the Union officers/members are ordered reinstated to their positions but without
backwages;.
3. Baliwag Mahogany Corporation is hereby directed to immediately reinstate Cecile
de Ocampo, Rene Villanueva and Marcelo dela Cruz to their former positions without
loss of seniority rights to pay them full backwages for the period from January 17,
1990 to March 15, 1990 only;
4. The Baliwag Mahogany Corporation is hereby directed to immediately reinstate
Alex Ramos, Ronaldo Cruz, Fernando Hernandez, Renato Puertas, Hernando
Legaspi to their former positions and to pay them backwages from date of dismissal
to March 15, 1990 only;
giving credence to the said evidence despite the fact that the same were not newlydiscovered evidence as defined under the Rules of Court. (Rollo, p. 11)
After a careful review of the records of this case, the Court finds the petition devoid of merit.
Petitioners insist that there is no specific finding by the respondent commision regarding the
particular participation of the individual petitioners in the supposed acts of violence or commission of
prohibited acts during the strike such as denial of free ingress to the premises of the company and
egress therefrom as well as illegal acts of coercion during the February, 1990 strike.
The Solicitor General disagrees and claims that it is undisputed that the union resorted to illegal acts
during the strike arguing that private respondent's personnel manager specifically identified the
union officers and members who committed the prohibited acts and actively participated therein.
Moreover, the Solicitor General maintains that the illegality of the strike likewise stems from the
failure of the petitioners to honor the certification order and heed the return-to-work order issued by
the Secretary of Labor.
Answering this contention, the petitioners argued that their failure to immediately return to work was
not impelled by any malicious or malevolent motive but rather, by their apprehension regarding their
physical safety due to the presence of military men in the factory who might cause them harm.
The law on the matter is Article 264 (a) of the Labor Code, to wit:
Article 264. (a) Prohibited activities. (a)
No strike or lockout shall be declared after assumption of jurisdiction by the President
or the Minister or after certification or submission of the dispute to compulsory or
voluntary arbitration or during the pendency of cases involving the same grounds for
the strike or lockout.
Any worker whose employment has been terminated as a consequence of an
unlawful lockout shall be entitled to reinstatement with full backwages. Any union
officer who knowingly participates in an illegal strike and any worker or union officer
who knowingly participates in the commission of illegal acts during a strike may be
declared to have lost his employment status: Provided, That mere participation of a
worker in a lawful strike shall not constitute sufficient ground for termination of his
employment, even if a replacement had been hired by the employer during such
lawful strike.
The clear mandate of the aforequoted article was stressed in the case of Union of Filipro Employees
v. Nestle Philippines, Inc. (G.R. Nos. 88710-13, December 19, 1990, 192 SCRA 396, 411) where it
was held that a strike that is undertaken despite the issuance by the Secretary of Labor of an
assumption or certification order becomes a prohibited activity and thus illegal, pursuant to the
second paragraph of Art. 264 of the Labor Code as Amended and the Union officers and members,
as a result, are deemed to have lost their employment status for having knowingly participated in an
illegal act.
Unrebutted evidence shows that the individual petitioners defied the return-to-work order of the
Secretary of Labor issued on February 15, 1990. As a matter of fact, it was only on February 23,
1990 when the barricades were removed and the main gate of the company was opened. Hence,
the termination of the services of the individual petitioners is justified on this ground alone.
Anent the contention that the respondent Commission gravely abused its discretion when it allowed
the presentation of additional evidence to prove the loss suffered by the company despite the fact
that they were mere afterthoughts and just concocted by the company, time and again, We
emphasize that "technical rules of evidence are not binding in labor cases. Labor officials should use
every and reasonable means to ascertain the facts in each case speedily and objectively, without
regard to technicalities of law or procedure, all in the interest of due process" (Philippine Telegraph
and Telephone Corporation v. National Labor Relations Commission, G.R. No. 80600, March 21,
1990, 183 SCRA 451, 457).
Turning to the legality of the termination of three (3) of the individual petitioners, petitioners contend
that the company acted in bad faith when it terminated the services of the three mechanics because
the positions held by them were not at all abolished but merely given to Gemac Machineries.
On the contrary, the company stresses that when it contracted the services of Gemac Machineries
for the maintenance and repair of its industrial machinery, it only adopted a cost saving and costconsciousness program in order to improve production efficiency.
We sustain respondent Commission's finding that petitioners' dismissal was justified by redundancy
due to superfluity and hence legal.
We believe that redundancy, for purposes of our Labor Code, exists where the services of an
employee are in excess of what is reasonably demanded by the actual requirement of the enterprise.
Succinctly put, a position is redundant where it is superfluous, and superfluity of a position or
positions may be the outcome of a number of factors, such as over hiring of workers, decreased
volume of business, or dropping of a particular product line or service activity previously
manufactured or undertaken by the enterprise. The employer had no legal obligation to keep in
its PAYROLL more employees, than are necessary for the operation of its business. (Wiltshire File
Co., Inc. v. National Labor Relations Commission, G.R. No. 82249, February 7, 1991; 193 SCRA
665,672).
The reduction of the number of workers in a company made necessary by the introduction of the
services of Gemac Machineries in the maintenance and repair of its industrial machinery is justified.
There can be no question as to the right of the company to contract the services of Gemac
Machineries to replace the services rendered by the terminated mechanics with a view to effecting
more economic and efficient methods of production.
In the same case, We ruled that "(t)he characterization of (petitioners') services as no longer
necessary or sustainable, and therefore properly terminable, was an exercise of business judgment
on the part of (private respondent) company. The wisdom or soundness of such characterization or
decision was not subject to discretionary review on the part of the Labor Arbiter nor of the NLRC so
long, of course, as violation of law or merely arbitrary and malicious action is not shown" (ibid, p.
673).
In contracting the services of Gemac Machineries, as part of the company's cost-saving program,
the services rendered by the mechanics became redundant and superfluous, and therefore properly
terminable. The company merely exercised its business judgment or management prerogative. And
in the absence of any proof that the management abused its discretion or acted in a malicious or
arbitrary manner, the court will not interfere with the exercise of such prerogative.
Well-settled is the rule that the factual findings of administrative bodies are entitled to great weight,
and these findings are accorded not only respect but even finality when supported by substantial
evidence (Family Planning Organization of the Philippines, Inc. v. National Labor Relations
Commission, G.R. No. 75987, March 23, 1992, p. 7citing Asian Construction and Development
Corporation v. National Labor Relations Commission, G.R. No. 85866, July 24, 1998, 187 SCRA
784, 787). Hence, the truth or the falsehood of alleged facts is not for this Court now to re-examine.
In the light of the foregoing considerations, it is clear that the assailed resolution of the respondent
Commission is not tainted with arbitrariness nor grave abuse of discretion.
ACCORDINGLY, the petition is DISMISSED for lack of merit and the resolution of the respondent
Commission dated July 8, 1991 is hereby AFFIRMED.
SO ORDERED.
C. COURT OF APPEALS
196. ST. MARTIN FUNERAL HOMES VS. NLRC
FACTS:
Private respondent alleges that he started working as Operations Manager of petitioner St. Martin
Funeral Home on February 6, 1995. However, there was no contract of employment executed between
him and petitioner nor was his name included in the semi-monthly payroll. On January 22, 1996, he was
dismissed from his employment for allegedly misappropriating P38,000.00. Petitioner on the other hand
claims that private respondent was not its employee but only the uncle of Amelita Malabed, the owner
of petitioner St.Martins Funeral Home and in January 1996, the mother of Amelita passed away, so the
latter took over the management of the business.
Amelita made some changes in the business operation and private respondent and his wife were no
longer allowed to participate in the management thereof. As a consequence, the latter filed a
complaint charging that petitioner had illegally terminated his employment. The labor arbiter rendered
a decision in favor of petitioner declaring that no employer-employee relationship existed between the
parties and therefore his office had no jurisdiction over the case.
ISSUE: WON the decision of the NLRC are appealable to the Court of Appeals.
RULING:
The Court is of the considered opinion that ever since appeals from the NLRC to the SC were
eliminated, the legislative intendment was that the special civil action for certiorari was and still is the
proper vehicle for judicial review of decisions of the NLRC. The use of the word appeal in relation
thereto and in the instances we have noted could have been a lapsus plumae because appeals by
certiorari and the original action for certiorari are both modes of judicial review addressed to the
appellate courts. The important distinction between them, however, and with which the Court is
particularly concerned here is that the special civil action for certiorari is within the concurrent
original jurisdiction of this Court and the Court of Appeals; whereas to indulge in the assumption that
appeals by certiorari to the SC are allowed would not subserve, but would subvert, the intention of the
Congress as expressed in the sponsorship speech on Senate Bill No. 1495.
Therefore, all references in the amended Section 9 of B.P No. 129 to supposed appeals from the NLRC
to the Supreme Court are interpreted and hereby declared to mean and refer to petitions for certiorari
under Rule65. Consequently, all such petitions should henceforth be initially filed in the Court of
Appeals in strict observance of the doctrine on the hierarchy of courts as the appropriate forum for the
relief desired.
This special civil action for certiorari seeks to annul the resolution of the NLRC
promulgated on January 2, 1992 in NLRC NCR Case No. 00-07-02329-87, setting aside the
Decision of the Labor Arbiter that found private respondents guilty of unfair labor practice,
declared the dismissal of petitioner as illegal, and ordered petitioner's reinstatement with
backwages and damages.
Petitioner was employed as supervisor of the ticketing section at the Manila branch office of
respondent China Airlines Ltd. (CAL). At the ticketing section, petitioner was assisted by a
senior ticketing agent, Eleanor Go; and two ticketing agents, Julie Chua and Josephine
Lobendino.
On October 29, 1986, private respondent K.Y. Chang, then district manager of the Manila
branch office of CAL, informed petitioner that management had decided to temporarily close its
ticketing section in order to prevent further losses. Petitioner's three assistants were likewise
notified that they too will be temporarily laid off from employment effective October 30, 1986.
Thereafter, CAL decided to permanently close said ticketing section. Thus, on November 5,
1986, petitioner and her staff members were informed that their recent lay-off from employment
will be considered permanent, effective one month from receipt of such notice. A notice of said
retrenchment was filed with the labor department on November 11, 1986.
Later, petitioner was advised to claim her retirement pay and other benefits. Feeling
aggrieved, petitioner sent a letter to private respondent Chang assailing the validity of her
termination from the service.
On July 1, 1987, petitioner filed with the Arbitration Branch of NLRC a complaint
for unfair labor practice and illegal dismissal with prayer for reinstatement, payment of
backwages, damages and attorney's fees.[1]
In a decision dated June 8, 1990, the labor arbiter ruled in favor of petitioner and decreed as
follows:
(a) P731,560.00 - representing her back monthly salary in the amount of P16,440.00
from October 29, 1986 and every month thereafter until June 8, 1990, the date of
Decision;
(b) P65,760.00 - representing her 13 month pay in the amount of P16,440.00 per year for the
years 1986,1987, 1988 and 1989;
th
(c) P24,600.00 - representing her Mid-year bonus in the amount of P8,200.00 per
year for the years 1987, 1988 and 1989;
SO ORDERED."[2]
Dissatisfied with the above judgment, private respondents appealed to the NLRC which in
its resolution dated January 2, 1992, set aside the decision of the labor arbiter. According to
public respondent, the charge of unfair labor practice had no factual and legal basis. It noted that
petitioner was not an elective officer of the union; and she was just an adviser with no formal
designation. The labor tribunal also observed that only those in the ticketing section were
affected by the retrenchment program and not one of the elective union officers were laid
off. Hence, public respondent declared that dismissing a union adviser while retaining all union
officers is far from any intent to bust the union. Accordingly, public respondent ruled that the
retrenchment was validly effected and disposed of the case as follows:
"WHEREFORE, the decision appealed from dated June 8, 1990, is hereby set
aside. The respondent are however directed to pay the complainant the sum of
P428,895.04 as her retrenchment pay.
SO ORDERED."[3]
[4]
Petitioner received copy of the aforesaid resolution of public respondent on January 7, 1992.
However, instead of filing the required motion for reconsideration, petitioner filed the instant
petition for certiorari. In doing so, petitioner boldly avers that a recourse to the NLRC via a
motion for reconsideration is futile and will only injure further her rights to a speedy and
unbiased judgment of the case. She did not expect the labor tribunal to rectify itself.
This precipitate filing of petition for certiorari under Rule 65 without first moving for
reconsideration of the assailed resolution warrants the outright dismissal of this case. As we
have consistently held in numerous cases,[5] a motion for reconsideration is indispensable, for it
affords the NLRC an opportunity to rectify errors or mistakes it might have committed before
resort to the courts can be had.
It is settled that certiorari will lie only if there is no appeal or any other plain, speedy and
adequate remedy in the ordinary course of law against acts of public respondent. [6] In this case,
the plain and adequate remedy expressly provided by law is a motion for reconsideration of the
impugned resolution, to be made under oath and filed within ten (10) days from receipt of the
questioned resolution of the NLRC, a procedure which is jurisdictional.[7] Hence, the filing of the
petition for certiorari in this case is patently violative of prevailing jurisprudence and will not
prosper without undue damage to the fundamental doctrine that undergirds the grant of this
prerogative writ.
Further, it should be stressed that without a motion for reconsideration seasonably filed
within the ten-day reglementary period, an order, decision or resolution of the NLRC, becomes
final and executory after ten (10) calendar days from receipt thereof.[8] Hence, the resolution of
the NLRC had become final and executory on January 17, 1992, insofar as petitioner is
concerned, because she admits under oath having received notice thereof [9] on January 7,
1992. The merits of her case may no longer be reviewed to determine if the public respondent
might be faulted for grave abuse of discretion, as alleged in her petition dated March 14,
1992. Thus, the court has no recourse but to sustain the respondent's position on jurisdictional
and other grounds, that the petition ought not be given due course and the case should be
dismissed for lack of merit.
WHEREFORE, the instant petition is hereby DISMISSED, and the RESOLUTION of
public respondent NLRC dated January 2, 1992, is hereby AFFIRMED.
No pronouncement as to costs.
SO ORDERED.
Bellosillo (Chairman), Puno, Mendoza, and Buena, JJ., concur.
[2]
[3]
[4]
However, the affected workers claim that they were dismissed because of their union
activities. In view of the alleged illegal dismissals and harassment by their employer,
the workers staged a strike on May 17, 1989. Upon complaint of respondent company,
Labor Arbiter Newton Sancho declared said strike illegal and decreed further that
Victorio Lunzaga, Alfred Jalet, Julito Macabodbod, Ramon Tabada and Remsy
Asensi, who had participated in the strike, were deemed to have lost their employment
status.
On appeal, the National Labor Relations Commission affirmed said decision.
Petitioner union then elevated the matter to this Court by way of petition
for certiorari which was eventually dismissed.
[6]
Meanwhile, the aggrieved workers filed with the Regional Arbitration Branch of the
NLRC their individual complaints against private respondent company for illegal
dismissal, unfair labor practice, underpayment of wages, 13th month pay, holiday pay
and overtime pay. They also sought reinstatement with back wages. The cases were
consolidated and assigned to Labor Arbiter Nicolas Sayon for arbitration. However,
noting that a similar case had been filed before the regional office of the labor
department, the labor arbiter refrained from resolving the issue of underpayment of
monetary benefits. He also found the charge of unfair labor practice untenable. But,
on the charge of illegal dismissal, he ruled on October 31, 1989, as follows:
"WHEREFORE in view of the foregoing, judgment is hereby rendered
declaring the dismissal of the following complainants illegal; namely:
1. Victorio C. Lunzaga
2. Julito C. Macabodbod
3. Alfredo E. Jalet
4. Gerundio F. Asejo
5. Ramon R. Tabada
"Respondent ALGON Engineering Construction Corporation and Alex
Gonzales and Edith Yap, are hereby ordered to reinstate the abovenamed complainants to their former positions without loss of seniority
rights plus six months backwages based on their latest salary rate at the
time of their dismissal, which is P65.00 per day equivalent to monthly
[7]
Petitioners and private respondents separately appealed the Labor Arbiters ruling to
the National Labor Relations Commission. Pending appeal, Edgar Juesan, Lordito
Tatad and Ramon Tabada filed their respective duly sworn affidavits of desistance and
motions to withdraw their complaints and money claims against private respondents.
Said motions were seasonably granted.
On May 17, 1991, the NLRC promulgated its resolution modifying the decision of
Labor Arbiter Nicolas Sayon. It held that the labor arbiter erred in not resolving the
issue of underpayment of wages because not all of the original complainants filed the
same money claims with the labor department. Thus, it awarded monetary benefits to
qualified workers. The NLRC disposed of the case as follows:
[8]
TOTAL. . .
= P 1,257.00
SERVICE INCENTIVE LEAVE PAY:
1) RAMSI ASENSI
5 days x P64.00 . . .= P320.00
2) VICTORIO LUNZAGA
10 days x P64.00 . . = 640.00
5 days x 53.00 . . .= 265.00
P905.00
3) JULIETO MACABODBOD
10 days x P64.00 . . = P640.00
5 days x
53.00 . . .= .265.00..P905.00
4) GERONIMO ASEJO
10 days x P64.00 . . = 640.00
5 days x
53.00 . . .= .265.000..P905.00
5) ALFREDO JALET
10 days x P64.00 . . = 640.00
5 days x 53.00 . . .=. 265.00
P905.00
6) VALERIANO MIJAS
10 days x P64.00 . . = 640.00
5 days x
53.00 . . .= . 265.00 . P905.00
7) PEDRO ROCHE
5 days x P64.00 . . .= 320.00
8) RODOLFO MONTECLARO
5 days x P64.00 . . .= 320.00
13th MONTH PAY:
1) RAMSI ASENSI
26 days x P64.00 x 10 mos. =
P16,640.00 x 1/12 . = P1,386.67
2) VICTORIO LUNZAGA
26 days x P64.00 x 12 mos. =
P19,968.00 x 1/12 . = P1,664.00
3) JULIETO MACABODBOD
26 days x P64.00 x 12 mos. =
P19,968.00 x 1/12 . = P1,664.00
4) GERONIMO ASEJO
26 days x P64.00 x 12 mos. =
P19,968.00 x 1/12 . = P1,664.00
5) ALFREDO JALET
26 days x P64.00 x 12 mos. =
P19,968.00 x 1/12 . = P1,664.00
6) VALERIANO MIJAS
26 days x P64.00 x 12 mos. =
P19,968.00 x 1/12 . = P1,664.00
7) PEDRO ROCHE
26 days x P64.00 x 12 mos. =
P19,968.00 x 1/12 . = P1,664.00
8) RODOLFO MONTECLARO
26 days x P64.00 x 12 mos. =
P19,968.00 x 1/12 . = Pl,664.00
9) JOSE NAVAL
26 days x P64.00 x 3 mos. =
P4,992.00 x 1/12 . = P 416.00
"2. The complaints of Edgar Juezon (sic), Lordito Tadtad and Ramon
Tabada are hereby dismissed as prayed for by said complainants.
"3. The complainants for illegal dismissal filed by Victorio Lunzaga
(Lonzaga) and Alfredo Jalet (Jalit) are hereby dismissed for having been
rendered moot and academic by Our decision in Case No. RAB-11-0500352-89.
"4. The complaints of Macabodbod and Asejo for illegal dismissal are
hereby DISMISSED for lack of merit.
"5. The charge of unfair labor practice is hereby dismissed for lack of
merit.
"SO ORDERED."
[9]
As noted by the Solicitor General, private respondents filed their motion for
reconsideration, which was denied. We find, however, that herein petitioners did not
move for reconsideration, as the petition did not so indicate and none appears on the
records before us.
[10]
Filing a petition for certiorari under Rule 65 without first moving for reconsideration
of the assailed resolution generally warrants the petition's outright dismissal. As we
consistently held in numerous cases, a motion for reconsideration by a concerned
[11]
[13]
[14]
In this recourse, petitioners impute the following errors on the part of public
respondent:
[I]
"THAT THE HONORABLE COMMISSION ERRED IN HOLDING
THAT THE DISMISSAL OF FIVE COMPLAINANTS WERE
JUSTIFIED IN VIEW OF THE FACT THAT THEIR COMPLAINT
HAVE BEEN RENDERED MOOT AND ACADEMIC BY ITS
DECISION IN CASE NO. RAB-O5-00353-89.
[II]
THAT HONORABLE COMMISSION AGAIN ERRED IN
DISMISSING THE COMPLAINT OF THE COMPLAINANTS
MACABODBOD AND ASEJO FOR LACK OF MERIT.
[III]
THE HONORABLE COMMISSION SERIOUSLY ERRED IN
AFFIRMING THE DECISION OF THE LABOR ARBITER
DISMISSING PETITIONER'S CHARGE OF UNFAIR LABOR
PRACTICE AGAINST THE RESPONDENT CORPORATION.
[IV]
QUESTION OF LAW."
[15]
In petitions for certiorari under Rule 65 of the Rules of Court, it may be noted that
"want of jurisdiction" and "grave abuse of discretion," and not merely reversible
error, are the proper grounds for review. The respondent acts without jurisdiction if he
does not have the legal authority to decide a case. There is excess of jurisdiction if the
respondent, having the power to determine the case, oversteps his lawful authority.
And there is grave abuse of discretion where the respondent acts in a capricious,
whimsical, arbitrary or despotic manner, in effect equivalent to lack of jurisdiction.
Here, petitioners neither assail the jurisdiction of public respondent nor attribute any
grave abuse of discretion on the part of the labor tribunal. Necessarily, this petition
must fail, for lack of substantial requisites under Rule 65.
[16]
[17]
Nevertheless, if only to cast aside all doubts for the benefit of the concerned workers,
we assayed into the merits of the case. As properly stated by the Solicitor General, the
point of inquiry here is whether petitioners areregular or project employees of
respondent company.
The Labor Code defines regular, project and casual employees as follows:
"ART 280. Regular and Casual Employment. - The provisions of written
agreement to the contrary notwithstanding and regardless of the oral
agreement of the parties, an employment shall be deemed to be regular
where the employee has been engaged to perform activities which are
usually necessary or desirable in the usual business or trade of the
employer, except where the employment has been fixed for a specific
project or undertaking the completion or termination of which has been
determined at the time of the engagement of the employee or where the
work or services to be performed is seasonal in nature and the
employment is for the duration of the season.
And employment shall be deemed to be casual if it is not covered by the
preceding paragraph: Provided, That, any employee who has rendered at
least one year of service, whether such service is continuous or broken,
shall be considered a regular employee with respect to the activity in
[19]
Furthermore, Policy Instruction No. 20, which was in force during the period of
petitioners' employment, stated:
[20]
regional office of the labor department as required under Policy Instruction No. 20.
This compliance with the reportorial requirement confirms that petitioners were
project employees.
Considering that petitioners were project employees, whose nature of employment
they were fully informed about, at the time of their engagement, related to a specific
project, work or undertaking, their employment legally ended upon completion of said
project. The termination of their employment could not be regarded as illegal
dismissal.
WHEREFORE, the instant petition is DISMISSED, and the assailed RESOLUTION
of respondent NLRC dated May 17, 1991, is AFFIRMED.
No pronouncement as to costs.
SO ORDERED.
controller who uses the same as the basis in determining the load of the
aircraft. As a policy, load controllers are prohibited from assisting in the
checking-in of passengers to prevent collusion with the check-in clerks.
On that same day, a passenger named Myla Cominero checked in for the
flight. She was escorted by Sgt. Jose Tompong, the police assistance officer
assigned at the domestic airport. The events of that day were best narrated by
Sgt. Tompong, in his statement dated January 25, 1993, submitted by both
parties as their common evidence.
"Q. Can you recall any incident that happened last January 19,
1993...?
A.
There was no unusual incident, except [that] a certain
woman who [greeted] me ... she presented to me her ticket. At
this point, I guided her [to] the Check-in Counter. Later, I came to
know her as Ms. Cominero.
Q.
A.
She presented her ticket to CIC Pelayo and when asked
how many pieces of baggage she was carrying, she said, seven
pieces of baggage.
Q.
Did you see the seven (7) pieces of baggage [checked-in]
by said passenger?
A.
Yes, when CIC Pelayo was about to check-in her baggage,
preparing the seven pieces of baggage tags, CIC Edgar Vicente
arrived and said Ako na ang bahala diyan.
Q.
A.
After the weighing of baggage, Ed Vicente talked to the
passenger because the weight of her seven (7) pieces of baggage
was more than 100 kgs.
Q.
A.
Sabi ni Ed, magbabayad ka rito ng more than P1,000.00,
kaya bale kinontrata na niya ang pasahero at ako ay lumayo na
sa counter.
Q.
A.
Noong bumalik ako sa ENTRANCE GATE , sabi sa akin ng
pasahero, Kuya, pakibigay mo nga itong pera doon sa kausap
kong lalaki na nag check in sa akin.
Q.
A.
Tinanong ko kung para saan ito at ang sabi niya para doon
sa excess baggage ko. Nakatipid ako ng kaunti.
Q.
A.
Q.
Ano naman ang ginawa mo sa pera na [ibinigay] sa iyo ng
pasahero?
A.
Noong mga 1500H na, kinuha sa akin in Ed Vicente ang
pera.
Q.
A.
Doon[,] malapit sa telephone booth ng terminal 2.
Pagkatapos nalaman ko nahuli pala ang pasahero bumalik at
sumakay sa eroplano.
Q.
Noong sinamahan mo ang pasahero na mag check-in sa
counter, may dala ba siyang ibang ticket or kaya ay may mga
kasama? Esmmis
A.
Nag check[-]in ang nasabing pasahero at walang kasama
at isang ticket ang hawak na inabot kay Ed Vicente.
Q.
Ayon sa aking pagtatanong, nasa iyo daw ang pera noong
hindi dumating ang pasahero sa eroplano noong boarding time
na, tutoo ba ito?
A.
Hindi po tutuo iyan. Kung sa akin ang pera, bakit si Ed
Vicente ang nag-atubiling magbayad ng excess charges ng
pasahero ng malaman niyang bulilyaso na. At ang masama rito ay
tinuruan pa ako in Ed na gumawa ng scenario.
Q.
A.
Sabihin ko raw na humingi ng tulong sa akin si Ms.
Cominero para hanapan ng pasaherong walang bagahe.
Q.
A.
Sinabi ko Pare huwag. Kasi hindi ko naman ito ginawa at
pati ako isasabit pa ninyo diyan.
Q.
Okay wala na akong itatanong. Mayroon ka bang gustong
sabihin sa pagtatanong na ito?
A.
Ang masasabi ko lang po ay ito. Kaya ako nagbigay ng
statement ay sa kadahilanan na nais kong bigyan ng katarungan
ang aking pangalan."
[1]
Then, Cominero arrived during the final call for boarding and before the actual
off-loading of her baggage. When questioned, Cominero insisted that she had
paid one thousand (P1,000.00) pesos as excess baggage charges at the
check-in counter although she was not issued any receipt. Informed of this
incident, the duty manager instructed the station control to call Cebu to
intercept Cominero and collect the corresponding excess baggage fee.
Thereafter, an investigation was conducted. Es-mso
When the anomaly was discovered, Vicente hastily went to the cashier, Loreto
Condez, to pay the excess baggage fee. Condez' statement submitted by both
parties as their common evidence, attests to these events:
"20 Jan. '9[3]
To
: Atty. R. Neri
From : L. B. Condez
Subject
[2]
[6]
On May 27, 1994, private respondent filed before the labor arbiter, a complaint
for illegal dismissal with prayer for reinstatement and payment of backwages,
damages and attorney's fees. On July 31, 1995, the labor arbiter ruled that
private respondent had direct involvement in the illegal pooling of baggage,
which is a scheme to obtain secret profits for himself and that such act of
attempting to defraud petitioner of its revenues warranted the termination of
private respondent from the service. The labor official thus decreed:
"WHEREFORE, foregoing premises considered, the complaint is,
as it is hereby DISMISSED for lack of merit and the dismissal of
the complaint is declared to be for a valid and for just and lawful
cause.
However, since complainant has served the respondent company
for almost eight (8) years without adverse records and on ground
of equitable consideration, we hereby adjudge an award of
P5,000.00 by way of financial assistance.
SO ORDERED."
[7]
decision. In justifying the reversal, the NLRC declared that the alleged
defrauding of petitioner's excess baggage revenue was not the handiwork of
private respondent. The labor tribunal further held that petitioner failed to
show that it suffered losses in revenues as a consequence of private
respondent's questioned act. It then disposed of the case as follows:
"WHEREFORE, in view of the foregoing considerations, the
Decision appealed from is hereby set aside and another one
entered reinstating the complainant with full backwages less
earnings elsewhere, if any.
SO ORDERED."
[8]
Its motion for reconsideration having been denied, petitioner filed the instant
petition before us, raising the following issues:
-I-
More appropriately phrased, the issue for our consideration is whether or not
the NLRC committed grave abuse of discretion in reversing and setting aside
the labor arbiter's decision finding private respondent's dismissal to be valid
and for just cause.
To begin with, we reiterate the rule that in certiorari proceedings under Rule
65, this Court does not assess and weigh the sufficiency of evidence upon
which the labor arbiter and public respondent NLRC based their decisions.
Our query is limited to the determination of whether or not public respondent
acted without or in excess of jurisdiction or with grave abuse of discretion in
rendering the assailed decisions. But when the findings of the NLRC
contradict those of the labor arbiter, this Court, in the exercise of its equity
jurisdiction, must of necessity review the records of the case to determine
which findings should be preferred as more conformable to the evidentiary
facts, as in this case.
[10]
[11]
where no rational motive is shown why the employer would single out private
respondent for dismissal unless the latter were truly guilty of serious offense.
[12]
That the statements of Vicente and Pelayo are credible is shown by the fact
that these are replete with essential details, which interlock with the
declarations of other witnesses. Thus, Sgt. Tompong declared that at around 5
p.m. private respondent retrieved from him the money earlier given by Vicente
because a problem cropped up. Next, another PAL employee, Irene Cancio in
her sworn statement, asserted that private respondent ordered the alterations
in the flight coupons so as to reflect the true charges on excess baggage of
Cominero. Then, Condez averred that Vicente paid the excess baggage fee of
Cominero long after the aircraft had departed, after which, private respondent
ordered Vicente to PHOTOCOPY the excess baggage receipt and send a
copy to Cebu via flight PR 839.
In the case at bar, there is substantial evidence showing that private
respondent had direct involvement in the illegal pooling of baggage. First,
private respondent urged Pelayo to check-in Cominero by proxy. Failing to
convince Pelayo, he chided the latter by saying "Pare ang laki naman yata ng
daga mo sa dibdib", and then called Vicente who in turn willingly cooperated
in checking-in Cominero. Second, when the anomaly was uncovered, private
respondent approached Sgt. Tompong and said, "Sarge, pakibalik mo na lang
ang pera dahil mayroon itong problema". Third, private respondent handed
the money amounting to P1,000.00 to Vicente, which the latter used to pay
the excess baggage fee. Fourth, private respondent instructed Vicente to call
a fellow load controller in Mactan airport to intercept Cominero and fix the
matter. Fifth, private respondent did not report the matter to his supervisors
although it is the practice whenever one is confronted with situation of the
same nature. Calr-ky
Surely, had the irregularity not been accidentally discovered, private
respondent would have enriched himself at the expense of petitioner. Worth
mentioning at this point is the failure of the private respondent to refute the
oral testimony of Vicente during the clarificatory hearing on March 25, 1993,
conducted by the Administrative Panel, which convincingly shows the actual
participation of the private respondent in the commission of fraud against the
petitioner.
salaries for the unexpired portion of his employment agreement and the
reimbursement of his AIRFARE [6].
In March of 1996, the case was referred to the National Labor
Relations Commission (hereinafter NLRC) Arbitration Division as by then it was
this agency which had jurisdiction over private respondents complaint by virtue of
Republic Act 8042, the Migrant Workers and Overseas Filipinos Act of 1995. After
the submission of position of papers, the labor arbiter assigned to the case rendered a
decision[7] dated April 27, 1998 in favor of private respondent. In this decision, the
labor arbiter held petitioners MCEI and Hanil jointly and severally liable to private
respondent in the amount of US$2,500.00 and 10% of the cash award as and by way
of attorneys fees.
The decision of the labor arbiter was appealed to the NLRC by petitioners on June
15, 1998. However, this appeal was dismissed by the NLRC in a Resolution [8] dated
February 26, 1999. The motion for reconsideration filed by petitioners was likewise
denied by the NLRC in its Order[9] dated September 28, 1999.
On December 17, 1999, petitioners filed a petition for certiorari with the Court of
Appeals questioning the above Resolution and Order of the NLRC. However, the
Court of Appeals dismissed the petition filed by petitioners in a Resolution [10] dated
December 27, 1999. The full text of the resolution is as follows:
The instant Petition for Certiorari is fatally defective for two (2) reasons: (1) there is
no certification against forum shopping by co-petitioner Hamil Development Co.,
Ltd.; and (2) there is no written explanation why the service of the pleading was not
done personally (Section 3, Rule 46 and Section 11, Rule 13, 1997 Rules of Civil
Procedure).
WHEREFORE, the instant Petition for Certiorari, having failed to comply with the
requirement of the Rules, as aforesaid, is DISMISSED outright.
SO ORDERED.
Petitioners filed a Motion for Reconsideration from this December 27, 1999
Resolution but this was denied by the Court of Appeals in a Resolution [11] dated March
3, 2000.
Hence, the recourse by petitioners to this Court where they raise, among other
issues, the propriety of the dismissal of their petition for certiorari by the Court of
Appeals on the grounds of non-compliance with the requirements of non-forum
shopping and lack of explanation of service by registered mail.
With respect to the first ground for the dismissal of the petition by the appellate
court, the requirement regarding the need for a certification of non-forum shopping in
original cases filed before the Court of Appeals and the corresponding sanction for
non-compliance thereto is found in Section 3, Rule 46 of the 1997 Rules of Civil
Procedure. Said section, in pertinent part, provides as follows:
Rule 46, Sec. 3. Contents and filing of petition; effect of non-compliance with
requirements.
XXX
The petitioner shall also submit together with the petition a sworn certification that he
has not theretofore commenced any other involving the same issues in the Supreme
Court, the Court of Appeals or different divisions thereof, or any other tribunal or
agency; if there is such other action or proceeding, he must state the status of the
same; and if he should thereafter learn that a similar action or proceeding has been
filed or is pending before the Supreme Court, the Court of Appeals, or different
divisions thereof, or any other tribunal or agency, he undertakes to promptly inform
the aforesaid courts and other tribunal or agency thereof within five (5) days
therefrom.
XXX
The failure of the petitioner to comply with any of the foregoing requirements shall be
sufficient ground for the dismissal of the petition.
In the case at bar, the petition for certiorari filed by petitioners before the Court of
Appeals contains a certification against forum shopping [12]. However, the said
certification was signed only by the corporate secretary of petitioner MCEI. No
representative of petitioner Hanil signed the said certification. As such, the issue to be
resolved is whether or not a certification signed by one but not all of the parties in a
petition constitutes substantial compliance with the requirements regarding the
certification of non-forum shopping.
The rule quoted above requires that in all cases filed in the Court of Appeals, as
with all initiatory pleadings before any tribunal, a certification of non-forum shopping
signed by the petitioner must be filed together with the petition. The failure of a
petitioner to comply with this requirement constitutes sufficient ground for the
dismissal of his petition. Thus, the Court has previously held that a certification not
attached to the complaint or petition or one belatedly filed [13] or one signed by counsel
and not the party himself[14] constitutes a violation of the requirement which can result
in the dismissal of the complaint or petition.
However, with respect to the contents of the certification, the rule of substantial
compliance may be availed of. This is because the requirement of strict compliance
with the provisions regarding the certification of non-forum shopping merely
underscores its mandatory nature in that the certification cannot be altogether
dispensed with or its requirements completely disregarded. [15] It does not thereby
interdict substantial compliance with its provisions under justifiable circumstances. [16]
In the case at bar, the Court of Appeals should have taken into consideration the
fact that petitioner Hanil is being sued by private respondent in its capacity as the
foreign principal of petitioner MCEI. It was petitioner MCEI, as the local private
employment agency, who entered into contracts with potential overseas workers on
behalf of petitioner Hanil.
It must be borne in mind that local private employment agencies, before they can
commence recruiting workers for their foreign principal, must submit with the POEA
a formal appointment or agency contract executed by the foreign based employer
empowering the local agent to sue and be sued jointly and solidarily with the principal
or foreign-based employer for any of the violations of the recruitment agreement and
contract of employment.[17] Considering that the local private employment agency may
sue on behalf of its foreign principal on the basis of its contractual undertakings
submitted to the POEA, there is no reason why the said agency cannot likewise sign
or execute a certification of non-forum shopping for its own purposes and/or on behalf
of its foreign principal.
It must likewise be stressed that the rationale behind the requirement that the
petitioners or parties to the action themselves must execute the certification of nonforum shopping is that the said petitioners or parties are in the best position to know
of the matters required by the Rules of Court in the said certification. [18] Such
Villamor[20], they argue that technicality, when it deserts its proper office as an aid to
justice and becomes its great hindrance, should deserve scant consideration from the
courts[21].
We are not persuaded.
In the case at bar, there was no substantial compliance made by petitioners of the
requirement in Section 11, Rule 13 of the 1997 Rules of Civil Procedure. The utter
disregard of the rules made by petitioners cannot justly be rationalized by harking on
the policy of liberal construction and substantial compliance. [22]
The fact that an affidavit of service accompanied their petition does not amount to
a substantial compliance with the requirement of an explanation why other modes of
service other than personal service were resorted to. An affidavit of service, under
Section 13, Rule 13 of the 1997 Rules of Civil Procedure, is required merely as proof
that service has been made to the other parties in a case. Thus, it is a requirement
totally different from the requirement that an explanation be made if personal service
of pleadings was not resorted to. In fact, a cursory reading of the affidavit of
service[23] attached by petitioners in their petition before the Court of Appeals shows
that it merely states that a certain Rogelio Mindol served copies of the pleading to the
counsel of private respondent, the NLRC, and the Solicitor-General by registered
mail. There is not even a hint of an explanation why such mode of service was
resorted to.
With respect to petitioners reliance on the much-abused doctrine laid down in the
case of Alonso vs. Villamor and other analogous cases, we adhere to our
pronouncement in the case of Solar Team Entertainment, Inc. vs. Court of Appeals [24].
To our mind, if motions to expunge or strike out pleadings for violation of Section 11
of Rule 13 were to be indiscriminately resolved under Section 6 of Rule
1[25] or Alonso vs. Villamor and other analogous cases, then Section 11 would become
meaningless and its sound purpose negated.
We are aware that in the cited case, the violation of Section 11, Rule 13 committed
by the party therein was eventually condoned and the pleading was allowed to remain
in the records. However, such action by the Court was premised on the fact that
counsel therein may not have been fully aware of the requirements and ramifications
of the said provision as the 1997 Rules of Civil Procedure had only been in effect for a
few months. Such circumstance does not obtain in the case at bar considering that it
has been years since the effectivity of the 1997 Rules of Civil Procedure. Moreover,
our decision in the Solar Team Entertainment, Inc.case contained a directive that, for
the guidance of the bench and the bar, strictest compliance with Section 11 of Rule 13
is mandated one month from the promulgation of the said decision. Petitioners thus
have no excuse for their non-compliance with the requirements embodied therein.
WHEREFORE, premises considered, the resolutions of the Court of Appeals
dated December 27, 1999 and March 03, 2000 are hereby AFFIRMED.
SO ORDERED.
D. SUPREME COURT
201. TANCINCO VS. GSIS
DE LEON, JR., J.:
Before us is a petition for review on certiorari, praying for the reversal of the
Resolutions dated May 30, 1997 and March 5, 1998 issued by the former Sixteenth Division of
the Court of Appeals in CA-G.R. SP No. 44148. The first resolution dismissed petitioners
appeal from the decision of the Employees Compensation Commission, whereas the second
resolution denied her motion for reconsideration.
[1]
the ground that there was no proof that petitioners husbands death was work-related. Petitioner
appealed the denial to the Employees Compensation Commission (Commission) which, on
December 19, 1996, issued a Resolution dismissing the appeal for lack of merit. As ruled by
the Commission:
[2]
It is evident that the death of SPO1 Tancinco on July 17, 1995, when he was on off
duty status did not arise out of and in the course of his employment as a member of
the PNP Security Command.
Apparently, the conditions aforementioned were not satisfied in the present
case. Notably, SPO1 Tancinco was repairing his service vehicle at the time of his
death. He was neither executing an order for VP Estrada nor performing an official
function on that fateful day inasmuch as Police Superintendent Atilano Miranda duly
certified that SPO1 Tancinco was on off-duty status on July 17, 1995.
We would like to stress once more that not all contingencies such as injury, disability,
or death which befall an employee are compensable. The same must be the result
of ACCIDENT arising out of and in the course of employment.
Since the cause of SPO1 Tancincos death is no longer part of his official functions,
the claim for compensation benefits under Presidential Decree No. 626, as amended,
cannot be given due course.
Petitioner filed a petition for review from the aforesaid decision of the Commission before
the Court of Appeals. On May 30, 1997, the appellate court issued the first assailed
resolution dismissing the petition for review on the following grounds: (a) that the certification
of non-forum shopping was defective; (b) that certified true copies of material portions of the
record were not attached to the petition; and (c) that the petitionfailed to state all the material
dates which would establish the timeliness thereof. As admitted by petitioner herself, she
received a copy of the resolution on June 9, 1997, and yet it was only on January 27, 1998, or
seven-and-a-half (7 ) months later, that she filed a motion for reconsideration. As can be
expected, the appellate court denied her motion in the second assailed resolution of March 5,
1998.
[3]
[4]
Petitioner seeks recourse before us via this petition for review on certiorari, arguing that:
[7]
[8]
[9]
Prescinding from the finality of the appealed resolutions, the appeal will still fail on the
merits. Rule III of the Amended Rules on Employees Compensation provides:
SECTION 1. Grounds(a) For the injury and the resulting disability or death to be
compensable, the injury must be the result of an employment ACCIDENT satisfying
all of the following conditions:
(1) The employee must have been injured at the place where his work requires him to
be;
(2) The employee must have been performing his official functions; and
(3) If the injury is sustained elsewhere, the employee must have been executing an
order for the employer.
xxx
xxx
xxx
The aforesaid requirements have not been met. Anent the first, as part of the former VicePresidents security detail, the decedent was required to guard the person of the former; hence,
his presence was officially required wherever the Vice-President would go. At the time of his
death, SPO1 Tancinco was off-duty since Vice-President Estrada was out of the country. In fact,
he was at home; it is not even known if he was temporarily re-assigned to another detail while
the Vice-President was away. Clearly, he was not at the place where his work required him to be.
As to the second requirement, it was not sufficiently established that SPO1 Tancinco died
while performing his official functions. In this regard, we held that policemen are regarded as
being on twenty-four (24) hour alert. As we explained in Employees Compensation
Commission v. Court of Appeals,
[10]
xxx But for claritys sake and as a guide for future cases, we hereby hold that
members of the national police, like P/Sgt. Alvaran, are by the nature of their
functions technically on duty 24 hours a day. Except when they are on vacation leave,
policemen are subject to call at any time and may be asked by their superiors or by
any distressed citizen to assist in maintaining the peace and security of the
community.
xxx
xxx
xxx
We hold that by analogy and for purposes of granting compensation under P.D. No.
626, as amended, policemen should be treated in the same manner as soldiers.
[11]
The twenty-four hour duty rule was originally applied to members of the armed forces,
until it was applied by extension to policemen, as aforesaid, and eventually to firemen.
[12]
However, in the more recent case of Government Service Insurance System v. Court of
Appeals, we clarified that not all deaths of policemen are compensable. Thus,
[13]
Taking together jurisprudence and the pertinent guidelines of the ECC with respect to
claims for death benefits, namely: (a) that the employee must be at the place where his
work requires him to be; (b) that the employee must have been performing his official
functions; and (c) that if the injury is sustained elsewhere, the employee must have
been executing an order for the employer, it is not difficult to understand then why
SPO2 Alegres widow should be denied the claims otherwise due her. Obviously, the
matter SPO2 Alegre was attending to at the time he met his death, that of ferrying
passengers for a fee, was intrinsically private and unofficial in nature proceeding as it
did from no particular directive or permission of his superior officer. In the absence
of such prior authority as in the cases of Hinoguin and Nitura, or peacekeeping nature
of the act attended to by the policeman at the time he died even without the explicit
permission or directive of a superior officer, as in the case of P/Sgt. Alvaran, there is
no justification for holding that SPO2 Alegre met the requisites set forth in the ECC
guidelines. That he may be called upon at any time to render police work as he is
considered to be on a round-the-clock duty and was not on an approved vacation leave
will not change the conclusion arrived at considering that he was not placed in a
situation where he was required to exercise his authority and duty as a policeman. In
fact, he was refusing to render one pointing out that he already complied with the duty
detail. At any rate, the 24-hour duty doctrine, as applied to policemen and soldiers,
serves more as an after-the-fact validation of their acts to place them within the scope
of the guidelines rather than a blanket license to benefit them in all situations that
may give rise to their deaths. In other words, the 24-hour duty doctrine should not be
sweepingly applied to all acts and circumstances causing the death of a police officer
but only to those which, although not on official line of duty, are nonetheless basically
police service in character. [italics supplied]
In the present case, the decedent was repairing a service vehicle when he was killed. We
have tried to view it from all possible angles, but the inescapable conclusion is that he was not
performing acts that are basically police service in character. As a policeman, SPO1 Tancinco
is part of an organized civil force for maintaining order, preventing and detecting crimes, and
enforcing the laws xxx. Based on these parameters, it cannot be said that the deceased was
discharging official functions; if anything, repairing a service vehicle is only incidental to his
job.
[14]
Neither was the last requirement satisfied. As the fatal incident occurred when SPO1
Tancinco was at home, it was incumbent on petitioner to show that her husband was discharging
a task pursuant to an order issued by his superiors. This also was not done.
In administrative proceedings, the quantum of proof necessary to support a claim is
substantial evidence, which is that amount of relevant evidence which a reasonable mind
might accept as adequate to justify a conclusion. Unfortunately, the burden was not
successfully met.
[15]
[16]
In closing, we express our heartfelt commiseration with petitioner for the misfortune which
has befallen her and her family. Even this Court, the embodiment of justice dispensed
impartially, can feel very human emotions, as it does so now. However, for reasons both
procedural and substantive, we cannot grant her petition.
WHEREFORE, the instant petition is hereby DENIED. The Resolutions dated May 30,
1997 and March 5, 1998 are AFFIRMED in toto. No costs.
SO ORDERED.
This petition for review assails the decision dated July 30, 1999 of
the Court of Appeals in CA-G.R. SP No. 50167, which affirmed the
order dated December 11, 1998 of Arbitrator Juan Valdez of the National
Conciliation and Mediation Board, Cordillera Administrative Region, Baguio
City. That order partially modified an earlier one dated March 5, 1994, by
directing respondent Philex Mining Corporation to pay petitioners their
separation pay in lieu of reinstatement.
[1]
[2]
[3]
[4]
Philex appealed to this Court and the case was remanded to the Court of
Appeals. On July 22, 1997, the appellate court promulgated its decision,
thus:
In view of the foregoing, we rule that, while there was indeed a valid reason for
retrenchment, the means employed were disadvantageous, thus inequitable, to the
affected workers. The fact that these workers signed quitclaims and received their
separation pay would not estop them from seeking reinstatement. The Supreme Court
said: The reason why quitclaims are commonly frowned upon as contrary to public
policy, and why they are held to be ineffective to bar claims for the full measure of the
workers legal rights, is the fact that the employer and the employee obviously do not
stand on the same footing. (Marcos vs. National Labor Relations Commission, G.R.
No. 111744, 248 SCRA 146 [1995]).
WHEREFORE, the petition is dismissed for lack of merit.
SO ORDERED.
[5]
Philex elevated the case to the Supreme Court via a petition for review on
certiorari, which we denied in a resolution dated January 14, 1998. Entry of
judgment was made on April 27, 1998.
On August 14, 1998, Philex filed a manifestation and motion for leave to
offer separation pay to petitioners, in lieu of reinstatement, before the Office of
Voluntary Arbitrator Juan Valdez. Philex alleged that petitioners positions no
longer existed and that there arose strained relations between the parties that
effectively barred reinstatement.
[6]
Petitioners aver that when the March 5, 1994 order directing their
reinstatement became final and executory, Arbitrator Valdez no longer had
jurisdiction to modify the same. According to them, an order that has become
final and executory can no longer be modified or altered.
Petitioners further insist that Philex failed to sufficiently establish (1) that
there were supervening events which rendered enforcement of the final order
unjust, and (2) that the positions vacated by them no longer existed and there
were no similar positions available for them. Petitioners point out that Philex
did not conduct any investigation as to the manner and purpose of the
abolition of their former positions. They also assert that Philex subcontracted
A basic tenet in our rules of procedure is that an award that is final and
executory cannot be amended or modified anymore. Nothing is more settled
in law than that once a judgment attains finality it thereby becomes immutable
and unalterable. It may no longer be modified in any respect, even if the
modification is meant to correct what is perceived to be an erroneous
conclusion of fact or law, and regardless of whether the modification is
attempted to be made by the court rendering it or by the highest court of the
land. However, this rule is subject to exceptions as stated in the case
of David vs. CA, 316 SCRA 710 (1999), cited by respondent:
[9]
One exception is that where facts and/or events transpire after a decision has become
executory, which facts and/or events present a supervening cause or reason which
renders the final and executory decision no longer enforceable. Under the law, the
court may modify or alter a judgment even after the same has become executory
whenever circumstances transpire rendering its execution unjust and inequitable, as
where certain facts and circumstances justifying or requiring such modification or
alteration transpired after the judgment has become final and executory.
[10]
In David, we held also that where an execution order [which] has been
issued is still pending, all proceedings on the execution are still proceedings in
the suit. As such, modification of the execution of such judgment is allowed.
[11]
[14]
[16]
employee of his right to reinstatement. Every labor dispute almost always results in
strained relations and the phrase cannot be given an overarching interpretation,
otherwise an unjustly dismissed employee can never be reinstated.
[17]
Considering the circumstances in the present case, we find that the only
issue to be resolved is whether the supervening events are grave enough to
warrant a modification in the execution of the judgment. Both the voluntary
arbitrator and the Court of Appeals found that reinstatement is no longer
possible due to the fact that respondent has been continuously suffering
business losses and reducing the number of its employees pending litigation,
and so the positions held by petitioners were abolished as a cost-cutting
measure. Petitioners argue, however, that to excuse the respondent from
reinstating the petitioners would be to allow it to do indirectly what it was not
allowed to do directly the retrenchment of the petitioners. They add that
what is so scheming about this ploy is that respondent now tries to justify its
refusal to reinstate the petitioners by its very own act of abolishing their
positions.
[18]
[19]
Despite our sympathy for the workers plight, however, we find no legal
support for their opposition to the conclusion and findings of the voluntary
arbitrator and the Court of Appeals. On record, there is no showing that the
abolition of the petitioners positions was capricious or whimsical. The
appellate court, as well as the voluntary arbitrator, based their decisions on
applicable law and the evidence. As confirmed by the appellate court, the
voluntary arbitrator also found that petitioners reinstatement had become not
only inappropriate but also impossible.
Regrettably, petitioners now raise questions the determination of which
would require the Court to look into the evidence adduced by the parties. This
cannot be done in a petition for review on certiorari. It is outside its purview
under Rule 45 of the 1997 Rules of Court. Factual findings of labor officials
who are deemed to have acquired expertise in matters within their respective
jurisdiction are generally accorded not only respect but even finality, and bind
us when supported by substantial evidence. It is not our function to assess
and evaluate the evidence all over again, particularly where the findings of
both the arbitrator and the Court of Appeals coincide. Thus, in this case,
absent a showing of an error of law committed by the court below, or of
[20]
likewise maintains that the Order of the respondent Regional Director of Labor, as
affirmed with modifications by respondent Secretary of Labor, does not clearly and
distinctly state the facts and the law on which the award was based. In its "Rejoinder to
Comment, the petitioner further questions the authority of the Regional Director to
award salary differentials and ECOLAs to private respondents, alleging that the original
and exclusive jurisdiction over money claims is properly lodged in the Labor Arbiter,
based on Article 217, paragraph 3 of the Labor Code.
Issue: Whether or not the Regional Director had jurisdiction over the case.
Held: This is a labor standards case, and is governed by Art. 128 of the Labor
Code. Labor standards refer to the minimum requirements prescribed by existing laws,
rules, and regulations relating to wages, hours of work, cost of living allowance and
other monetary and WELFARE BENEFITS , including occupational, safety, and health
standards. Under the present rules, a Regional Director exercises both visitorial and
enforcement power over labor standards cases, and is therefore empowered to
adjudicate money claims, provided there still exists an employer-employee relationship,
and the findings of the regional office is not contested by the employer concerned.
Petitioner, on the other hand, contended that on July 21, 1986, some 48 SECURITY GUARDS
threatened mass action against it. Alarmed by a possible abandonment of post by the guards and
mindful of its contractual obligations to its clients/principals, petitioner relieved and re-assigned the
complaining guards to other posts in Metro Manila. Those relieved were ordered to report to the
agency's main office for reassignment. Only few complied, so those who failed to comply were
placed on "AWOL" status. Petitioner claimed it complied with the Labor Code provisions, and in
support thereof, it submitted the "Quitclaim and Waiver" of thirty-four (34) complainants. It further
alleged that complainants who rendered over-time work as shown by their time sheets were paid
accordingly; that service incentive leaves not availed of, night shift differential, rest days, and
holidays were paid in cash.
On November 18, 1986, petitioner filed an ex parte manifestation alleging that nineteen (19)
complainants had withdrawn their complaints.
On January 1, 1987, petitioner again filed a supplemental ex parte manifestation alleging that
Luis San Franciscoalso withdrew his complaint.
Earlier, on October 21, 1986, seventeen (17) complainants repudiated their quitclaim and waiver.
They alleged that management pressured them to sign documents which they were not allowed to
read and that if such waiver existed, they did not have any intention of waiving their rights under the
law.
Petitioner in its reply argued that complainants were estopped from denying their quitclaims on the
ground of equity; that being high school graduates, complainants fully understood the document
they signed; and that complainant's allegation of coercion or threat was a mere afterthought.
Later, six (6) of the seventeen (17) complainants who repudiated their quitclaims again executed
quitclaims and waivers.
On March 20, 1987, public respondent Luna C. Piezas issued an order, the dispositive portion of
which reads:
WHEREFORE, premises considered, Order of Compliance is hereby issued directing
respondent to pay complainants the amounts opposite their names, to wit:
1. Mamerto Gener Pl,989.05
2. Armando Yumul 1,989.05
3. Herminigildo Bargas 1,989.05
4. Marciano Bolocon 1,989.05
5. William Adami 1,989.05
6. Antonio Publico 1,989.05
2. Dorado, Jaime
3. Ellares, Guillermo
4. Factor, Arturo
5. Feruish, Daniel
6. Fonseca, Crisostomo
7. Ga, Jerry
8. Guinsatao, Francisco
9. Liper, Sixto
10. Manalla, Allan
11. Orquesta, George
12. Pardeno, Joseph
13. Quiroz, Wilfredo
14. Uy, Benjamin
15. Ordona, Edwin
16. Torres, Deuretiro
Petitioner filed a motion for reconsideration.
On March 13, 1989, public respondent Undersecretary modified his order of March 23, 1988 as
follows:
WHEREFORE, the Order of this Office dated 23 March 1988 is hereby modified to
read as follows, to wit:
1. The complaint of the fifteen (15) complainants above set forth are hereby
reinstated and their names added to those listed by the Regional Director in his
order;
2. The monetary awards is [sic] hereby limited to the past three years from the time
of the filing of the complaint without any qualification subject to computation at
the Regional Office. (p. 105, Rollo.)
The reason for the reduction to fifteen (15) of the original list of sixteen (16) complainants was
because the Undersecretary found that Joseph Pardeno was never relieved from his post but
continued to work for petitioner.
In this petition for certiorari, the petitioner alleges:
1. that it was deprived of due process of law, both substantive and procedural;
2. that the Order dated March 20, 1987 is contrary to law and that respondent Luna
C. Piezas acted with grave abuse of discretion amounting to lack or excess of
jurisdiction; and
3. that the Orders dated March 23, 1988 and March 13, 1989, affirming and
modifying the Order dated March 20, 1987 are contrary to law and that respondent
Dionisio C. De la Serna acted with grave abuse of discretion amounting to lack or
excess of jurisdiction.
On April 17, 1989, as prayed for in the petition, the Court issued a temporary restraining
order upon a bond of P50,000 enjoining the respondents from enforcing or executing the orders
dated March 20, 1987, March 23, 1988 and March 13, 1989 of the Department of Labor and
Employment.
The petition has no merit.
The petitioner was not denied due process for several hearings were in fact conducted by the
hearing officer of the Regional Office of the DOLE and the parties submitted position papers upon
which the Regional Director based his decision in the case. There is abundant jurisprudence to the
effect that the requirements of due process are satisfied when the parties are given an opportunity to
submit position papers (Coca-Cola Bottlers, Phil., Inc. vs. NLRC, G.R. No. 78787, December 18,
1989; Asiaworld Publishing House vs. Ople, 152 SCRA 224; Manila Doctors Hospital vs. NLRC, 135
SCRA 262). What the fundamental law abhors is not the absence of previous notice but rather the
absolute lack of opportunity to be heard (Antipolo Realty Corp. vs. National Housing Authority, 153
SCRA 399). There is no denial of due process where a party is given an opportunity to be heard and
present his case (Ong, Sr. vs. Parel, 156 SCRA 768; Adamson & Adamson, Inc. vs. Amores, 152
SCRA 237). Since petitioner herein participated in the hearings, submitted a position paper, and filed
a motion for reconsideration of the March 23, 1988 decision of the Labor Undersecretary, it was not
denied due process.
The petitioner is estopped from questioning the alleged lack of jurisdiction of the Regional Director
over the private respondents' claims. Petitioner submitted to the jurisdiction of the Regional Director
by taking part in the hearings before him and by submitting a position paper. When the Regional
Director issued his March 20, 1987 order requiring petitioner to pay the private respondents the
benefits they were claiming, petitioner was silent. Only the private respondents filed a motion for
reconsideration. It was only after the Undersecretary modified the order of the Regional Director on
March 23, 1988 that the petitioner moved for reconsideration and questioned the jurisdiction of the
public respondents to hear and decide the case. The principle of jurisdiction by estoppel bars it from
doing this. In Tijam vs. Sibonghanoy, 23 SCRA 29, 35-36, we held:
It has been held that a party can not invoke the jurisdiction of a court to secure
affirmative relief against his opponent and, after obtaining or failing to obtain such
relief, repudiate or question that same jurisdiction (Dean vs. Dean, 136 Or. 694, 86
A.L.R. 79). In the case just cited, by way of explaining the rules, it was further said
that the question whether the court had jurisdiction either of the subject-matter of the
action or of the parties was not important in such cases because the party is barred
from such conduct not because the judgment or order of the court is valid and
conclusive as an adjudication, but for the reason that such a practice can not be
tolerated obviously for reasons of public policy.
Furthermore, it has also been held that after voluntarily submitting a cause and
encountering an adverse decision on the merits, it is too late for the loser to question
the jurisdiction or power of the court (Pease vs. Rathbunjones, etc., 243 U.S. 273, 61
L. Ed. 715, 37 S. Ct. 283; St. Louis etc. vs. McBride, 141 U.S. 127, 35 L. Ed. 659).
And in Littleton vs. Burgess, 16 Wyo, 58, the Court said that it is not right for a party
who has affirmed and invoked the jurisdiction of a court in a particular matter to
secure an affirmative relief, to afterwards deny that same jurisdiction to escape a
penalty.
Sibonghanoy was reiterated in Crisostomo vs. C.A., 32 SCRA 54; Libudan vs. Gil, 45 SCRA
17; Capilitan vs. De la Cruz, 55 SCRA 706; and PNB vs. IAC, 143 SCRA 299.
The fact is, the Regional Director and the Undersecretary did have jurisdiction over the private
respondents' complaint which was originally for violation of labor standards (Art. 128[b], Labor
Code). Only later did the guards ask for backwages on account of their alleged constructive
dismissal (p. 32, Rollo). Once vested, that jurisdiction continued until the entire controversy was
decided (Lee vs. MTC, 145 SCRA 408; Abadilla vs. Ramos, 156 SCRA 92; and Pucan vs. Bengzon,
155 SCRA 692).
The jurisdiction of public respondents over the complaints is clear from a reading of Article 128(b) of
the Labor Code, as amended by Executive Order No. 111, thus:
(b) The provisions of Article 217 of this Code to the contrary notwithstanding and in
cases where the relationship of employer-employee still exists, the Minister of Labor
and Employment or his duly authorized representatives shall have the power to order
and administer, after due notice and hearing, compliance with the labor standards
provisions of this Code and other labor legislation based on the findings of labor
regulation officers or industrial safety engineers made in the course of inspection,
and to issue writs of execution to the appropriate authority for the enforcement of
their orders, except in cases where the employer contests the findings of the labor
regulation officer and raises issues which cannot be resolved without considering
evidentiary matters that are not verifiable in the normal course of inspection.
In Briad Agro Development Corp. vs. Hon. Dionisio De la Serna, G.R. No. 82805, June 29, 1989, we
clarified the amendment when we ruled, thus:
To recapitulate under EO 111, the Regional Directors, in representation of the
Secretary of Labor and notwithstanding the grant of exclusive original jurisdiction
to Labor Arbiters by Article 217 of the Labor Code, as amended have power to
hear cases involving violations of labor standards provisions of the Labor Code or
other legislation discovered in the course of normal inspection, and order compliance
therewith, provided that:
l) the alleged violations of the employer involve persons who are still his employees,
i.e., not dismissed, and
2) the employer does not contest the findings of the labor regulations officer or raise
issues which cannot be resolved without considering evidentiary matters that are not
verifiable in the normal course of inspection (p. 9, Concurring Opinion, J. Narvasa.)
The ruling in Briad Agro was reiterated in Maternity Children's Hospital vs. Secretary of Labor, G.R.
No. 78909, June 30, 1989:
... Under the present rules, a Regional Director exercises both visitorial and
enforcement power over labor standards cases, and is therefore empowered to
adjudicate money claims, provided there still exists an employer-employee
relationship, and the findings of the regional office is not contested by the employer
concerned. (p. 5, Decision.)
WHEREFORE, the petition is dismissed and the orders dated March 23, 1988 and March 13, 1989
of the Undersecretary of Labor are hereby affirmed. The temporary restraining order earlier issued
by this Court is lifted. No costs.
SO ORDERED.
After the parties had submitted their position papers and evidence, the Regional Director
issued an order on January 11, 1988, the dispositve portion of which reads thus:
WHEREFORE, premises considered, an Order is hereby entered:
a) Ordering respondent [herein petitioner] to refund to complainant Teodorico
Camas the amount of Seven Hundred and Seventy Five Pesos (P775.00) having
been illegally deducted from his salaries; and
b) Ordering respondent to pay individual claimants in the second case their
unpaid overtime pay, legal holiday pay, living allowance and service incentive
leave within ten (10) days from receipt hereof, otherwise a writ of execution
shall be issued for the enforcement of this Order. (p. 92, Rollo.)
Petitioner's appeal to the Secretary of Labor was dismissed by the latter. Hence, this petition
for certiorari in which the petitioner alleges:
1. that the Regional Director has no jurisdiction over its employees' claims;
and
2. that it (petitioner) was denied due process.
The petition is devoid of merit. The jurisdiction of the Regional Director over claims for
violation of labor standards is conferred by Article 128-B of the Labor Code, as amended by
Executive Order No. 111 of March 26,1987 which provides that:
(b) The Provisions of Article 217 of this Code to the contrary notwithstanding
and in cases where the relationship of employer-employee still exists, the
Minister of Labor and Employment or his duly authorized representatives shall
have the power to order and administer, after due notice and hearing,
compliance with the labor standards provisions of this Code and other labor
legislation based on the findings of labor regulation officers or industrial
safety engineers made in the course of inspection, and to issue writs of
execution to the appropriate authority for the enforcement of their orders,
except in cases where the employer contests the findings of the labor
regulation officer and raises issues which cannot be resolved without
considering evidentiary matters that are not verifiable in the normal course of
inspections. (Emphasis supplied.)
The jurisdiction of the Regional Director over employees' claims for wages and other
monetary benefits not exceeding P5,000 has been affirmed by Republic Act No. 6715,
amending Article 129 of the Labor Code as follows:
Art. 129. Recovery of wages, simple money claims and other benefits. Upon
complaint of any interested party, the Regional Director of the Department of
Labor and Employment or any of the duly authorized hearing officers of the
This is a petition for certiorari seeking review of two (2) Orders [1] issued by the respondent
Secretary of Labor and Employment dismissing petitioner's appeal.
The case started when the Office of the Regional Director, Department of Labor and
Employment (DOLE), Region I, San Fernando, La Union, received a letter-complaint dated April
25, 1995, requesting for an investigation of petitioner's establishment, Copylandia Services &
Trading, for violation of labor standards laws. Pursuant to the visitorial and enforcement powers
of the Secretary of Labor and Employment or his duly authorized representative under Article
128 of the Labor Code, as amended, inspections were conducted at Copylandia's outlets on April
27 and May 2, 1995. The inspections yielded the following violations involving twenty-one (21)
employees who are copier operators: (1) underpayment of wages; (2) underpayment of 13th
month pay; and (3) no service incentive leave with pay.[2]
The first hearing of the case was held on June 14, 1995, where petitioner was represented by
Joseph Botea, Officer-in-Charge of the Dagupan City outlets, while the 21 employees were
represented by Leilani Barrozo, Gemma Gales, Majestina Raymundo and Laureta Clauna. It was
established that a copier operator was receiving a daily salary ranging from P35.00 to P60.00
plus commission of P20.00 per P500.00 worth of PHOTOCOPYING . There was also incentive
pay of P20.00 per P250.00 worth of PHOTOCOPYING in excess of the first P500.00.[3]
On July 13, 1995, petitioner's representative submitted a Joint Affidavit signed and executed
by the 21 employees expressing their disinterest in prosecuting the case and their waiver and
release of petitioner from his liabilities arising from non-payment and underpayment of their
salaries and other benefits. Individually signed documents dated December 21, 1994, purporting
to be the employees' Receipt, Waiver and Quitclaim were also submitted.[4]
In the investigation conducted by Hearing Officer Adonis Peralta on July 21, 1995, the 21
employees claimed that they signed the Joint Affidavit for fear of losing their jobs. They added
that their daily salary was increased to P92.00 effective July 1, 1995, but the incentive and
commission schemes were discontinued. They alleged that they did not waive the unpaid benefits
due to them.[5]
On October 30, 1995, Regional Director Guerrero N. Cirilo issued an Order [6] favorable to
the 21 employees. First, he ruled that the purported Receipt, Waiver and Quitclaim dated
December 21 and 22, 1994, could not cause the dismissal of the labor standards case against the
petitioner since the same were executed before the filing of the said case. Moreover, the
employees repudiated said waiver and quitclaim. Second, he held that despite the salary increase
granted by the petitioner, the daily salary of the employees was still below the minimum daily
wage rate of P119.00 under Wage Order No. RB-I-03. Thirdly, he held that the removal of the
commission and incentive schemes during the pendency of the case violated the prohibition
against elimination or diminution of benefits under Article 100 of the Labor Code, as amended.
The dispositive portion of the Order states:
Rosalina Carrera
- P68,010.91
2.
Joanna Ventura
- 28,568.10
3.
Mercelita Paredes
- 68,010.91
4.
Aida Licuanan
- 68,010.91
5.
Gemma Gales
- 68,010.91
6.
Clotilda Zarata
- 27,808.33
7.
Consolacion Miguel
- 65,708.28
8.
Gemma Macalalay
- 68,010.91
9.
Wandy Aquino
- 19,559.58
10.
Laureta Clauna
- 68,010.91
11.
Josephine Valdez
- 27,808.33
12.
Leilani Berrozo
13.
14.
Theresa Rosario
15.
Edelyn Maramba
- 27,808.33
- 68,010.91
- 68,010.91
21.
16.
Yolly Dimabayao
- 40,380.60
17.
Vilma Calaguin
- 68,010.91
18.
Maila Balolong
- 40,380.60
19.
Clarissa Villena
- 27,808.33
20.
Maryann Galinato
- 68,010.91
Desiree Cabasag
Total
- 27,808.33
P1,081,756.70
and to submit proof of payment to this Office within seven (7) days from
receipt hereof. Otherwise, a Writ of Execution will be issued to enforce this
Order.
"SO ORDERED."[7]
Petitioner received a copy of the Order on November 10, 1995. On November 15, 1995,
petitioner filed a Notice of Appeal. [8] The next day, he filed a Memorandum of Appeal
accompanied by a Motion to Reduce Amount of Appeal Bond and a Manifestation of an Appeal
Bond.
In his appeal memorandum,[9] petitioner questioned the jurisdiction of the Regional Director
citing Article 129 of the Labor Code, as amended, [10] and Section 1, Rule IX of the Implementing
Rules of Republic Act No. 6715.[11] He argued that the Regional Director has no jurisdiction over
the complaint of the 21 employees since their individual monetary claims exceed the P5,000.00
limit. He alleged that the Regional Director should have indorsed the case to the Labor Arbiter
for proper adjudication and for a more formal proceeding where there is ample opportunity for
him to present evidence to contest the claims of the employees. He further alleged that the
Regional Director erred in computing the monetary award since it was done without regard to the
actual number of days and time worked by the employees. He also faulted the Regional Director
for not giving credence to the Receipt, Waiver and Quitclaim of the employees.
In the Motion to Reduce Amount of Appeal Bond,[12] petitioner claimed he was having
difficulty in raising the monetary award which he denounced as exorbitant. Pending resolution
of the motion, he posted an appeal bond in the amount of P105,000.00 insisting that the
jurisdiction of the Regional Director is limited to claims of P5,000.00 per employee and there
were 21 employees involved in the case.
On November 22, 1995, petitioner also filed a request to hold in abeyance any action
relative to the case for a possible amicable settlement with the employees.[13]
On January 10, 1996, District Labor Officer Adonis Peralta forwarded a Report showing that
the petitioner and most of the 21 employees had reached a compromise agreement. The
Release, Waiver and Quitclaim was signed by the following employees and show the following
amounts they received, viz:
1. Aida Licuanan
- P3,000.00
2. Clarissa Villena
- 3,000.00
3. Gemma Gales
- 3,000.00
4. Desiree Cabansag
- 3,000.00
5. Clotilda Zarata
- 3,000.00
6. Consolacion Miguel
- 5,000.00
7. Josephine Valdez
- 3,000.00
8. Maryann Galinato
- 5,000.00
9. Theresa Rosario
- 3,000.00
10.Yolly Dimabayao
- 3,000.00
11.Vilma Calaguin
- 3,000.00
12.Gemma Macalalay
- 3,000.00
13.Edelyn Maramba
- 5,000.00
14.Charito Gonzales
- 3,000.00
15.Joanna Ventura
- 3,000.00
Four (4) employees did not sign in the compromise agreement. They insisted that they be paid
what is due to them according to the Order of the Regional Director in the total amount of
P231,841.06. They were Laureta Clauna, Majestina Raymundo, Leilani Barrozo and Rosalina
Carrera.[14]
In a letter[15] dated February 23, 1996, the Regional Director informed petitioner that he
could not give due course to his appeal since the appeal bond of P105,000.00 fell short of the
amount due to the 4 employees who did not participate in the settlement of the case. In the same
letter, he directed petitioner to post, within ten (10) days from receipt of the letter, the amount
of P126,841.06 or the difference between the monetary award due to the 4 employees and the
appeal bond previously posted.
On March 13, 1996, petitioner filed a Motion for Reconsideration to Reduce Amount of
Appeal Bond.[16] He manifested that he has closed down his business operations due to severe
financial losses and implored the Regional Director to accept the appeal bond already filed for
reasons of justice and equity.
In an Order dated December 3, 1996, the respondent Secretary denied the foregoing Motion
for Reconsideration on the ground that the directive from the Regional Director to post an
additional surety bond is contained in a "mere letter" which cannot be the proper subject for a
Motion for Reconsideration and/or Appeal before his office. He added that for failure of the
petitioner to post the correct amount of surety or cash bond, his appeal was not perfected
following Article 128 (b) of the Labor Code, as amended. Despite the non-perfection of the
appeal, respondent Secretary looked into the Receipt, Waiver and Quitclaim signed by the
employees and rejected it on the ground that the consideration was unconscionably
inadequate. He ruled, nonetheless, that the amount received by the said employees should be
deducted from the judgment award and the difference should be paid by the petitioner.
On December 26, 1996, petitioner filed a Motion for Reconsideration. On February 13,
1997, he filed a Motion to Admit Additional Bond and posted the amount of P126,841.06 in
compliance with the order of the Regional Director in his letter dated February 13, 1996.[17]
On October 24, 1997, the respondent Secretary denied the Motion for Reconsideration. He
ruled that the Regional Director has jurisdiction over the case citing Article 128 (b) of the Labor
Code, as amended. He pointed out that Republic Act No. 7730 repealed the jurisdictional
limitations imposed by Article 129 on the visitorial and enforcement powers of the Secretary of
Labor and Employment or his duly authorized representatives. In addition, he held that
petitioner is now estopped from questioning the computation made by the Regional Director as a
result of the compromise agreement he entered into with the employees. Lastly, he reiterated his
ruling that the Receipt, Waiver and Quitclaim signed by the employees was not valid.
Petitioner is now before this Court raising the following issues:
Whether or not Public Respondent acted with grave abuse of discretion amounting to
lack or in excess of jurisdiction when he set aside the Release and Quitclaim executed
by the seventeen (sic) complainants before the Office of the Regional Director when
Public Respondent himself ruled that the Appeal of the Petitioner was not perfected
and, therefore, Public Respondent did not acquire jurisdiction over the case.
II
Whether or not Public Respondent acted with grave abuse of discretion amounting to
lack or in excess of jurisdiction when in complete disregard of Article 227 of the
Labor Code, Public Respondent set aside and nullified the Release and Quitclaim
executed by the seventeen (sic) complainants.
III
Whether or not Public Respondent acted with grave abuse of discretion amounting to
lack or in excess of jurisdiction when he affirmed the Order of the Regional Director
who, in complete disregard of the due process requirements of law, computed the
monetary award given to the private respondents without notice to petitioner and
without benefit of hearing.
IV
Whether or not petitioner is deemed estopped from appealing the decision of the
Regional Director when it (sic) entered into a compromise settlement with
complainants/private respondents.
The threshold issues that need to be settled in this case are: (1) whether or not the Regional
Director has jurisdiction over the instant labor standards case, and (2) whether or not petitioner
perfected his appeal.
With regard to the issue of jurisdiction, petitioner alleged that the Regional Director has no
jurisdiction over the instant case since the individual monetary claims of the 21 employees
exceed P5,000.00. He further argued that following Article 129 of the Labor Code, as amended,
and Section 1, Rule IX of the Implementing Rules of Republic Act No. 6715, the jurisdiction
over this case belongs to the Labor Arbiter, and the Regional Director should have indorsed it to
the appropriate regional branch of the National Labor Relations Commission (NLRC). On the
other hand, the respondent Secretary held that the jurisdictional limitation imposed by Article
129 on his visitorial and enforcement power under Article 128 (b) of the Labor Code, as
amended, has been repealed by Republic Act No. 7730.[18] He pointed out that the amendment
"[n]otwithstanding the provisions of Article 129 and 217 of the Labor Code to the contrary"
erased all doubts as to the amendatory nature of the new law, and in effect, overturned this
Court's ruling in the case ofServando's Inc. v. Secretary of Labor and Employment.[19]
We sustain the jurisdiction of the respondent Secretary. As the respondent correctly pointed
out, this Court's ruling in Servando --- that the visitorial power of the Secretary of Labor to order
and enforce compliance with labor standard laws cannot be exercised where the individual claim
exceeds P5,000.00, can no longer be applied in view of the enactment of R.A. No. 7730
amending Article 128 (b) of the Labor Code, viz:
Article 128 (b) - Notwithstanding the provisions of Articles 129 and 217 of this Code
to the Contrary, and in cases where the relationship of employer-employee still exists,
the Secretary of Labor and Employment or his duly authorized representatives shall
have the power to issue compliance orders to give effect to the labor standards
provisions of the Code and other labor legislation based on the findings of the labor
employment and enforcement officers or industrial safety engineers made in the
course of inspection. The Secretary or his duly authorized representatives shall issue
writs of execution to the appropriate authority for the enforcement of their orders,
except in cases where the employer contests the findings of the labor employment and
enforcement officer and raises issues supported by documentary proofs which were
not considered in the course of inspection.
An order issued by the duly authorized representative of the Secretary of Labor and
Employment under this article may be appealed to the latter. In case said order
involves a monetary award, an appeal by the employer may be perfected only upon
the posting of a cash or SURETY BOND issued by a reputable bonding company
duly accredited by the Secretary of Labor and Employment in the amount equivalent
to the monetary award in order appealed from. (Italics supplied.)
The records of the House of Representatives[20] show that Congressmen Alberto S. Veloso and
Eriberto V. Loreto sponsored the law. In his sponsorship speech, Congressman Veloso
categorically declared that "this bill seeks to do away with the jurisdictional limitations imposed
through said ruling (referring to Servando) and to finally settle any lingering doubts on the
visitorial and enforcement powers of the Secretary of Labor and Employment." [21] Petitioner's
reliance on Servando is thus untenable.
The next issue is whether petitioner was able to perfect his appeal to the Secretary of Labor
and Employment. Article 128 (b) of the Labor Code clearly provides that the appeal bond must
be "in the amount equivalent to the monetary award in the order appealed from." The records
show that petitioner failed to post the required amount of the appeal bond. His appeal was
therefore not perfected.
IN VIEW WHEREOF, the petition for certiorari is dismissed. No pronouncement as to
costs.
SO ORDERED.
The petition is not meritorious, and the same should be as it is hereby dismissed.
The facts as borne by the records are as follows:
The labor dispute started on August 25, 1995 when the Company and the Union
reached
a
deadlock
in
their
negotiations
for
a
new collective
bargaining agreement. On August 28, 1995, the Union filed a Notice of Strike with the
National Conciliation and Mediation Board (NCMB).
On September 8, 1995,[3] the then Acting Secretary of the Department of Labor and
Employment, Jose S. Brillantes, intervened and assumed jurisdiction over the dispute
pursuant to Art. 263, par. (g),[4] of the Labor Code, as amended. Thus, the Order[5] of the
said Acting Secretary of Labor enjoined any strike or lockout, whether actual or
intended, between the parties. His Notice of the Assumption Order [6]was personally
served on the representatives of the Company, namely, on Atty. Allan Montao, counsel
of the Union-FFW, on September 9, 1995 at 1:25 p.m. and twice on Ms. Liza Dimaano,
Union President, first on September 8, 1995 at 7:15 p.m. and again on September 11,
1995 at 9:30 a.m. but both union representatives refused to acknowledge receipt
thereof.
Despite the assumption Order, the Union struck on September 14, 1995. Two (2)
days later, the Acting Secretary of Labor issued an Order [7]directing the striking workers
to return to work within twenty-four (24) hours and for the Company to admit them back
to work under the terms and conditions prevailing prior to the strike. Notice[8] of the
Return-to-Work Order[9] dated September 16, 1995 of the Acting Secretary of Labor
was sent to the striking Union members but still some of them refused to heed the order
and continued with their picket. The Federation of Free Workers (FFW) received and
acknowledged receipt of the said Return to Work Order on September 18, 1995. On
September 23, 1995, violence erupted in the picket lines. The service bus ferrying nonstriking workers was stoned, causing injuries to its passengers. Thereafter, complaints
for threats, defamation, illegal detention and physical injuries were filed against the
strikers.
On October 2, 1995, the Company issued letters of termination for cause to the
workers who did not report back to work despite the Notice of Assumption and Returnto-Work Orders issued by the Acting Secretary Jose S. Brillantes of the Department of
Labor and Employment (DOLE).
On October 27, 1995, the Acting Secretary of Labor issued another
Order[10] directing the Company to reinstate all striking workers except the Union
Officers, shop stewards, and those with pending criminal charges, x x x while the
resolution of the legality of the strike was pending. This exclusion Order was reaffirmed
with some modifications in an Order[11] dated November 24, 1995.
On December 5, 1995, the Union filed with this Court a petition for certiorari,
docketed as G.R. No. 122743, questioning the exclusions made in the aforesaid Orders.
On June 27, 1996, while the said petition in G.R. No. 122743 was pending, then
Secretary of Labor Leonardo A. Quisumbing issued a Writ of Execution[12] for the
physical reinstatement of the remaining striking workers who were not reinstated as
contained in the thirty-two (32) page list[13] attached to the aforesaid writ.
Accordingly, on July 3, 1996, the Company filed a Motion to Quash, Recall or
Suspend the Writ of Execution [14] issued by Secretary Quisumbing. This motion was
denied[15] by the Department of Labor and Employment (DOLE, for brevity) for lack of
merit and, in the same Order, the DOLE directed the issuance of an Alias Writ to
enforce the actual and physical reinstatement of the workers, or in case the same was
not feasible, to effect PAYROLL reinstatement. On November 21, 1996, the
Companys motion for reconsideration was also denied. [16]
On December 9, 1996, the Company filed with this Court a petition for certiorari,
docketed as G.R. No. 127215, questioning the denial of its motion for reconsideration
and the Alias Writ issued by the DOLE to enforce the actual and physical reinstatement
or the PAYROLL reinstatement of the workers (including the Original Writ of Execution
of June 27, 1996).
After we consolidated[17] the petitions for certiorari of the Company and the Union in
G.R. Nos. 122743 and 127215, respectively, we rendered a Decision therein
on December 12, 1997. The Companys petition for certiorari in G.R. No. 127215 was
dismissed for lack of merit. In G.R. No. 122743, we granted the Unions petition and
ordered the reinstatement of all striking workers without exception. We also directed
the Secretary of Labor and Employment to determine with dispatch the legality of the
strike as well as the liability of the individual strikers, if any.
After receipt of our said Decision in G.R. Nos. 122743 and 127215, the DOLE
issued an Alias Writ of Execution on August 26, 1998. Thereafter, the Company moved
to quash the Alias Writ which was, however, denied [18] by the DOLE. The motion for
reconsideration filed by the Company was similarly denied. [19] Aggrieved by the
preceding rulings of the DOLE, the Company elevated this case to this Court via
another petition for certiorari docketed as G.R. No. 135788.
On December 7, 1998, we resolved [20] to dismiss the said petition in G.R. No.
135788 for (a) failing to state the place of service by registered mail on the adverse
party; (b) failing to submit a certification duly executed by the president of the
petitioning Company or by its representative which shows its authority to represent and
act on behalf of the Company; and (c) for lack of the requisite certificate of nonforum shopping. We denied this petition with finality on our March 15, 1999
Resolution[21] where we held that the Secretary of Labor did not abuse his discretion in
denying the Companys motion to quash the execution of our Decision dated December
12, 1997.
In compliance with our order to the Secretary of Labor and Employment to
determine with dispatch the legality of the strike, marathon hearings were
conducted[22] at the DOLE Office with Atty. Lita V. Aglibut as hearing officer. On
September 22, 1998, both the Union and the Company complied with the order to
submit their respective position papers. The Company adduced evidence and
submitted its case for decision. The Union did not adduce evidence. Instead, the Union
manifested that it would file a motion to dismiss for failure of the Company to prove its
case with the request that it be allowed to present evidence should its motion be denied.
During the subsequent hearings[23] conducted by the hearing officer of DOLE, the
Union insisted that a ruling should first be made on the Demurrer to Evidence it
previously filed notwithstanding repeated reminders by the Hearing Officer that the
technical rules of evidence and procedure do not apply to proceedings before
DOLE. Thereafter, an exchange of pleadings, reiterating their respective positions,
ensued between the Company and the Union.
On May 19, 1999, the Union filed a motion before the DOLE praying for the
issuance of another Alias Writ of Execution in connection with our March 15, 1999
Resolution in G.R. No. 135788. The Union contended that this Resolution has declared
the dismissals of the striking workers as illegal and therefore a writ should be issued for
the physical reinstatement of the workers with full backwages and other benefits
reckoned from June 27, 1996.
On May 28, 1999, the Secretary of Labor and Employment resolved the matter in a
Decision.[24] The Secretary of Labor declared therein that in hearings and resolutions of
labor disputes, before the DOLE, his Office is not governed by the strict and technical
rules of evidence and procedure observed in the regular courts of law, and that it will
resolve the issues based on the pleadings, the documentary evidence and other
records of the case. The dispositive portion of the said Decision dated May 28, 1999
reads:
SO ORDERED.
On January 24, 2000, only the Union sought reconsideration [27] of the said Decision
of the appellate court. However, it was denied for lack of merit by the Court of Appeals
on April 19, 2000 in its Resolution.[28]
In the petition at bench, petitioners Union, Madara and Manayao submits the
following assignment of errors, to wit:
[32]
it . . . .(the first and second assigned errors) essentially involve questions of fact. It
calls for a re-evaluation of facts and a re-examination of the evidence.
We take this occasion to emphasize that the office of a petition for review
on certiorari under Rule 45 of the Rules of Court requires that it shall raise only
questions of law.[33] The factual findings by quasi-judicial agencies, such as the
Department of Labor and Employment, when supported by substantial evidence, are
entitled to great respect in view of their expertise in their respective fields. [34] Judicial
review of labor cases does not go so far as to evaluate the sufficiency of evidence on
which the labor officials findings rest. [35] It is not our function to assess and evaluate all
over again the evidence, testimonial and documentary, adduced by the parties to an
appeal, particularly where the findings of both the trial court (here, the DOLE Secretary)
and the appellate court on the matter coincide, [36] as in this case at bar. The Rule limits
that function of the Court to the review or revision of errors of law and not to a second
analysis of the evidence.[37] Here, petitioners would have us re-calibrate all over again
the factual basis and the probative value of the pieces of evidence submitted by the
Company to the DOLE, contrary to the provisions of Rule 45. Thus, absent any
showing of whimsical or capricious exercise of judgment, and unless lack of any basis
for the conclusions made by the appellate court be amply demonstrated, we may not
disturb such factual findings.
Although we have ruled against the reliability of position papers in disposing of labor
cases, in the cases of Batongbacal v. Associated Bank [38] and Progress Homes v.
NLRC,[39] this was due to certain patent matters that should have been tried by the
administrative agency concerned, such as certain factual circumstances which,
however, are unavailing in the case at bar.
In Batongbacal, we withheld judgment on the case due to the absence of a
definitive factual determination of the status of petitioner therein as an assistant vicepresident of therein respondentBank. It has not been established by the Labor Arbiter
whether the petitioner therein was a managerial or a rank-and-file employee, noting that
there are different causes of termination for both the managerial and rank-and-file
employees. Thus, the need to remand the case was necessary.
In Progress Homes, on the other hand, we found that despite the absence of any
evidence to establish and support therein private respondents claim that the petitioners
therein were their immediate employers, the Labor Arbiter forthwith concluded the illegal
dismissal of the private respondents. Also, there was the apparent failure of the Labor
Arbiter to justify why the private petitioner therein should be held solidarily liable
with Progress Homes. There was a clear absence of evidence to show that petitioner
therein had engaged the services of private respondents therein and that petitioner
therein had acted maliciously and in bad faith in terminating the services of private
respondents.
The herein petitioners dismally failed to show that there really existed certain issues
which would necessitate the remand of this case at bar, or that the appellate court
misapprehended certain facts when it dismissed their petition for certiorari.
The need to determine the individual liabilities of the striking workers, the union
officers and members alike, was correctly dispensed with by the Secretary of Labor
after he gave sufficient opportunity to the striking workers to cease and desist from
continuing with their picket. Ensconced in the Labor Code of the Philippines, as
amended, is the rule that:
xxx
xxx
(g) When, in his opinion, there exists a labor dispute causing or likely to cause a strike
or lockout in an industry indispensable to the national interest, the Secretary of
Labor and Employment may assume jurisdiction over the dispute and decide
it or certify the same to the Commission for compulsory arbitration. Such
assumption per certification shall have the effect of automatically enjoining the
intended or impending strike or lockout as specified in the assumption or
certification order. If one had already taken place at the time of assumption or
certification, all striking or locked outemployees shall immediately return to
work and the employer shall immediately resume operations and re-admit all
workers under the same terms and conditions prevailing before the strike or
lockout. The Secretary of Labor and Employment or the Commission may seek the
assistance of law enforcement agencies to ensure the compliance with this
provision as well as with such orders as he may issue to enforce the same.
(Emphasis Ours)
xxx
xxx
xxx
It is clear from the foregoing legal provision that the moment the Secretary of Labor
assumes jurisdiction over a labor dispute in an industry indispensable to national
interest, such assumption shall have the effect of automatically enjoining the
intended or impending strike. It was not even necessary for the Secretary of Labor to
issue another order directing them to return to work. The mere issuance of an
assumption order by the Secretary of Labor automatically carries with it a return-to-work
order, even if the directive to return to work is not expressly stated in the assumption
order.[40] However, petitioners refused to acknowledge this directive of the Secretary of
x x x, the reports of the DOLE process server, shows that the Notice of Order
of 8 September 1995 was actually served on the Union President. The latter,
however, refused to acknowledge receiptof the same on two separate
occasions (on 8 September 1995 at 7:15 p.m. and on 11 September 1995 at
9:30 a.m.). The Unions counsel of record, Atty. Allan Montano, similarly
holidays, between the hours of eight in the morning and five in the afternoon.
xxx
However, the above-cited rule is not applicable to the case at bar inasmuch as
Sections 1[44] and 4,[45] Rule III of the same NLRC Manual provide that such Execution
shall issue only upon a judgment or order that finally disposes of an action or
proceeding. The assumption and return-to-work Orders issued by the Secretary of
Labor in the case at bar are not the kind of orders contemplated in the immediately cited
rule of the NLRC because such Orders of the Secretary of Labor did not yet finally
dispose of the labor dispute. As pointed out by the Secretary of Labor in his Decision,
petitioners cannot now feign ignorance of his official intervention, to wit:
The extent of judicial review over the Secretary of Labors arbitral award is
not limited to a determination of grave abuse in the manner of the secretarys
exercise of his statutory powers. This Court is entitled to, and must in the
exercise of its judicial power review the substance of the Secretarys award
when grave abuse of discretion is alleged to exist in the award, i.e., in the
appreciation of and the conclusions the Secretary drew from the evidence
presented.
However, this Courts review (of) the substance does not mean a re-calibration of the
evidence presented before the DOLE but only a determination of whether the Secretary
of Labors award passed the test of reasonableness when he arrived at his conclusions
made thereon. Thus, we declared in Meralco, that:
In this case we believe that the more appropriate and available standard and
one does not require a constitutional interpretationis simply the standard of
reasonableness. In laymans terms, reasonableness implies the absence of
arbitrariness; in legal parlance, this translates into the exercise of proper
discretion and to the observance of due process. Thus, the question we have
to answer in deciding this case is whether the Secretarys actions have been
reasonable in light of the parties positions and the evidence they presented.[48]
Thus, notwithstanding any allegation of grave abuse of discretion, unless it can be
amply demonstrated that the Secretary of Labors arbitral award did not pass the test of
reasonableness, his conclusions thereon shall not be disturbed, as in the case at bar.
The main thrust of a petition for certiorari under Rule 65 of the Rules of Court is only
the correction of errors of jurisdiction including the commission of grave abuse of
discretion amounting to lack or excess of jurisdiction. However, for this Court to
properly exercise the power of judicial review over a decision of an administrative
agency, such as the DOLE, it must first be shown that the tribunal, board or officer
exercising judicial or quasi-judicial functions has indeed acted without or in excess of its
or his jurisdiction, and that there is no appeal, or any plain, speedy and adequate
remedy in the ordinary course of law.[49] In the absence of any showing of lack of
jurisdiction or grave abuse tantamount to lack or excess of jurisdiction, judicial review
may not be had over an administrative agencys decision. We have gone over the
records of the case at bar and we see no cogent basis to hold that the Secretary of
Labor has abused his discretion.
In the fourth and fifth assignment of errors, petitioners would have us believe that
the Court of Appeals, in its assailed Decision ruled in a manner absolute that prevailing
technical rules of evidence in the courts of law and equity have no room in
administrative and/or quasi-judicial proceedings; and that the non-application of
technical rules of procedure in proceedings before the Office of the Secretary of Labor
should not have barred herein petitioners from adducing evidence after their demurrer
to evidence was denied.
We do not agree. That declaration of the Court of Appeals should be taken in the
context of the whole paragraph and the law and the jurisprudence cited in the assailed
denied their demurrer to evidence and forthwith rendered decision on the illegality of the
strike. Petitioners have only themselves to blame for having defied the order of the said
Hearing Officer of DOLE to submit position papers with supporting evidence. A
party who has availed of the opportunity to present his position paper cannot claim to
have been denied due process.[53] The requirements of due process are satisfied when
the parties to a labor case are given the opportunity to submit position papers wherein
they are supposed to attach all the documents that would prove their claim in the event
it will be decided that no further hearing should be conducted or that hearing was not
necessary.[54]
The grant of plenary powers to the Secretary of Labor under Art. 263(g) of the Labor
Code, as amended, makes it incumbent for him to bring about soonest, a fair and just
solution to the differences between the employer and the employees so that the
damage such labor dispute might cause upon the national interest may be minimized as
much as possible, if not totally averted, by avoiding stoppage of work or any lagging of
the activities of the industry or the possibility of these contingencies which might cause
detriment to such national interest. [55] Accordingly, he may adopt the most reasonable
and expeditious way of writing finis to the labor dispute. Otherwise, the result would be
absurd and contrary to the grant of plenary powers to him by the Labor Code over a
labor dispute causing or likely to cause a strike or lockout in an industry indispensable
to the national interest.
And finally, with respect to petitioners claim of backwages, we find that the
ratiocination of the appellate court in its assailed Decision is in accord with law and
settled jurisprudence, to wit:
In fine, there is no reversible error in the assailed Decision and Resolution of the
Court of Appeals.
WHEREFORE, the petition is DISMISSED. The appealed Decision dated December
23, 1999 and the Resolution dated April 19, 2000 of public respondent Court of Appeals
are AFFIRMED. No costs.
SO ORDERED.
At bar is a Petition for Certiorari under Rule 65 of the Revised Rules of Court, seeking to
set aside the July 7, 1995 Order[1] of the then Acting Secretary Jose Brillantes of the Department
of Labor and Employment, in NCMB-NCR-NS-03-122-95, on the ground of grave abuse of
discretion amounting to lack or excess of jurisdiction.
The antecedent facts are, as follows:
On March 9, 1995, the private respondent, Phimco Industries Labor Association (PILA),
duly certified collective bargaining representative of the daily paid workers of the petitioner,
Phimco Industries Inc. (PHIMCO), filed a notice of strike with the National Conciliation and
Mediation Board, NCR, against PHIMCO, a corporation engaged in the production of matches,
after a deadlock in the collective bargaining and negotiation. On April 21, 1995, when the
several conciliation CONFERENCES CALLED by the contending parties failed to resolve
their differences PILA, composed of 352[2] members, staged a strike.
On June 7, 1995, PILA presented a petition for the intervention of the Secretary of Labor in
the resolution of the labor dispute, to which petition PHIMCO opposed. Pending resolution of
the said petition or on June 26, 1995, to be precise, PHIMCO sent notice of termination to some
47[3] workers including several union officers.
On July 7, 1995, the then Acting Secretary of Labor Jose Brillantes assumed jurisdiction
over the labor dispute and issued his Order; ruling, thus:
Accordingly, all the striking workers, except those who have been handed down
termination papers on June 26, 1995, are hereby directed to return to work within
twenty-four (24) hours from receipt of this Order and for the Company to accept them
back under the same terms and conditions prevailing prior to the strike.
The parties are further ordered to cease and desist from committing any act that will
aggravate the situation.
To expedite the resolution of this dispute, the parties are directed to submit
their position papers and evidence within ten (10) days from receipt of this Order.
SO ORDERED.[4]
On July 12, 1995, petitioner brought the present petition; theorizing, that:
I
THE HONORABLE ACTING SECRETARY JOSE BRILLANTES ACTED WITH
GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OR EXCESS OF
JURISDICTION IN ISSUING THE ASSAILED ORDER.
II
THE HONORABLE ACTING SECRETARY JOSE BRILLANTES ACTED WITH
GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OR EXCESS OF
JURISDICTION WHEN HE WENT BEYOND THE BASIS FOR ASSUMPTION
OF JURISDICTION UNDER ART. 263 OF THE LABOR CODE."[5]
On July 31, 1995, two weeks after the filing of the Petition, the public respondent issued
another Order[6] temporarily holding in abeyance the implementation of the questioned Order
dated July 7, 1995 for a period of thirty (30) day; directing, as follows:
SO ORDERED."[7]
The pivotal issue here is: whether or not the public respondent acted with grave abuse of
discretion amounting to lack or excess of jurisdiction in assuming jurisdiction over subject labor
dispute.
The petition is impressed with merit
Article 263, paragraph (g) of the Labor Code, provides:
(g) When, in his opinion, there exist a labor dispute causing or likely to cause a
strike or lockout in an industry indispensable to the national interest, the Secretary of
Labor and Employment may assume jurisdiction over the dispute and decide it or
certify the same to the Commission for compulsory arbitration x x x.
The Labor Code vests in the Secretary of Labor the discretion to determine what
industries are indispensable to the national interest. Accordingly, upon the
determination by the Secretary of Labor that such industry is indispensable to the
national interest, he will assume jurisdiction over the labor dispute in the said
industry.[8] This power, however, is not without any limitation. In upholding the
constitutionality of B.P. 130 insofar as it amends Article 264 (g) [9] of the Labor Code, it
stressed in the case of Free telephone Workers Union vs. Honorable Minister of
Labor and Employment, et al.,[10] the limitation set by the legislature on the power of
the Secretary of Labor to assume jurisdiction over a labor dispute, thus:
Batas Pambansa Blg. 130 cannot be any clearer, the coverage being limited to
strikes or lockouts adversely affecting the national interest. [11]
In this case at bar, however, the very admission by the public respondent draws the labor
dispute in question out of the ambit of the Secretarys prerogative, to wit:
While the case at bar appears on its face not to fall within the strict categorization
of cases imbued with national interest, this office believes that the obtaining
circumstances warrant the exercise of the powers under Article 263 (g) of the Labor
Code, as amended.[12]
The private respondent did not even make any effort to touch on the indispensability of the
match factory to the national interest. It must have been aware that a match factory, though of
value, can scarcely be considered as an industry indispensable to the national interest as it
cannot be in the same category as generation and distribution of energy, or those undertaken by
banks, hospitals, and export-oriented industries.[13] Yet, the public respondent assumed
jurisdiction thereover, ratiocinating as follows:
For one, the prolonged work disruption has adversely affected not only the
protagonists, i.e., the workers and the Company, but also those directly and indirectly
dependent upon the unhampered and continued operations of the Company for their
means of livelihood and existence. In addition, the entire community where the plant
is situated has also been placed in jeopardy. If the dispute at the Company remains
unabated, possible loss of employment, not to mention consequent social problems,
might result thereby compounding the unemployment problem of the country.
Thus we cannot be unmindful of the possible dire consequences that might ensue if the
present dispute is allowed to remain unresolved, particularly when an alternative
dispute resolution mechanism obtains to dispose of the differences between the
parties herein.[14]
It is thus evident from the foregoing that the Secretarys assumption of jurisdiction
grounded on the alleged obtaining circumstances and not on a determination that the industry
involved in the labor dispute is one indispensable to the national interest, the standard set by
the legislature, constitutes grave abuse of discretion amounting to lack of or excess of
jurisdiction. To uphold the action of the public respondent under the premises would be
stretching too far the power of the Secretary of Labor as every case of a strike or lockout where
there are inconveniences in the community, or work disruptions in an industry though not
indispensable to the national interest, would then come within the Secretarys power. It would be
practically allowing the Secretary of Labor to intervene in any Labor dispute at his
pleasure. This is precisely why the law sets and defines the standard: even in the exercise of his
power of compulsory arbitration under Article 263 (g) of the Labor Code, the Secretary must
follow the law. For when an overzealous official by-passes the law on the pretext of retaining a
laudable objective, the intendment or purpose of the law will lose its meaning as the law itself is
disregarded[15]
In light of the foregoing, we hold that the public respondent gravely abused his discretion in
assuming jurisdiction over the labor dispute sued upon in the case.
WHEREFORE, the petition is hereby GRANTED; and the assailed Order, dated July 7,
1995, of the Acting Secretary of Labor SET ASIDE. No pronouncement as to costs.
SO ORDERED.
twenty-five percent (25%) consent requirement. It averred among others, that settled
is the rule that when a petition for certification election is filed by the federation which
is merely an agent, the petition is deemed to be filed by the local/chapter, the
principal, which must be a legitimate labor organization; that for a local to be vested
with the status a legitimate labor organization, it must submit to the Bureau of Labor
Relations (BLR) or the Industrial Relations Division of the Regional Office of the
Department of Labor and Employment the following: a) charter certificate, indicating
the creation or establishment of a local or chapter; b) constitution and by-laws; c) set
of officers, and d) books of accounts; that petitioner failed to submit the aforesaid
requirements necessary for its acquisition of legal personality; that compliance with
the aforesaid requirements must be made at the time of the filing of the petition within
the freedom period; that the submission of the aforesaid requirements beyond the
freedom period will not operate to allow the defective petition to prosper; that
contrary to the allegation of the petitioner, the number of workers in the subject
bargaining unit is 486, twenty-five percent (25%) of which is 122; that the consent
signatures submitted by the petitioner is 120 which is below the required 25%
consent requirement; that of the 120 employees who allegedly supported the petition,
one (1) executed a certification stating that the signature, Margarito Cabalhug, does
not belong to him, 15 retracted, 9 of which were made before the filing of the petition
while 6 were made after the filing of the petition; and, that the remaining 104
signatures are way below the 25% consent requirement.
On 16 January 1995, forced-intervenor filed an Addendum/Supplement to its Motion
to Dismiss, together with the certification issued by the Regional Office No. VII, this
Department, attesting to the fact that the mandatory requirements necessary for the
petitioner to acquire the requisite legal personality were submitted only on 6 January
1995 and the certification issued by the BLR, this Department, stating that as of 11
January 1995, the ANGLO-Cebu Shipyard and Engineering Work has not been
reported as one of the affiliates of the Alliance of Nationalist and Genuine Labor
Organization (ANGLO). Forced intervenor alleged that it is clear from the said
certification that when the present petition was filed on 27 December 1994, petitioner
and its alleged local/chapter have no legal personality to file the same. It claimed that
the fatal defect in the instant petition cannot be cured with the submission of the
requirements in question as the local/chapter may be accorded the status of a
legitimate labor organization only on 6 January 1995 which is after the freedom
period expired on 31 December 1994. Forced intervenor further claimed that the
documents submitted by the petitioner were procured thru misrepresentation, and
fraud, as there was no meeting on 13 November 1994 for the purpose of ratifying a
constitution and by-laws and there was no election of officers that actually took place.
On 15 February 1995, petitioner filed its opposition to the respondent's motion to
dismiss. It averred among others, that in compliance with the order of the MedArbiter, it submitted to the Regional Office No. VII, this Department, the following
documents; charter certificate, constitution and by-laws; statement on the set of
officers and treasurer's affidavit in lieu of the books of accounts; that the submission
of the aforesaid document, as ordered, has cured whatever defect the petition may
have at the time of the filing of the petition, that at the time of the filing of petition, the
total number of rank and file employees in the respondent company was about 400
and that the petition was supported by 120 signatures which are more than the 25%
required by law; that granting without admitting that it was not able to secure the
signatures of at least 25% of the rank and file employees in the bargaining unit, the
Med-Arbiter is still empowered to order for the conduct of a certification election
precisely for the purpose of ascertaining which of the contending unions shall be the
exclusive bargaining agent pursuant to the ruling of the Supreme Court in the case
of California Manufacturing Corporation vs.Hon. Undersecretary of Labor, et al., G.R.
No. 97020, June 8, 1992.
On 20 February 1995, forced-intervenor filed its reply, reiterating all its arguments
and allegations contained in its previous pleadings. It stressed that petitioner is not a
legitimate labor organization at the time of the filing of the petition and that the
petitioner's submission of the mandatory requirements after the freedom period
would not cure the defect of the petition.
On 13 March 1995, the Med-Arbiter issued the assailed Resolution dismissing the
petition, after finding that the submission of the required documents evidencing the
due creation of a local was made after the lapse of the freedom period. 1
The Alliance of Nationalist Genuine Labor Organization-Kilusang Mayo Uno (ANGLO-KMU) filed an
appeal from the March 13, 1995 Med-Arbiter's resolution insisting that it is a legitimate labor
organization at the time of the filing of the petition for certification election, and claiming that
whatever defect the petition may have had was cured by the subsequent submission of the
mandatory requirements.
In a Resolution dated August 8, 1995, respondent Undersecretary Bienvenido E. Laguesma, by
authority of the Secretary of Labor and Employment, set aside the Med-Arbiter's resolution and
entered in lieu thereof a new order "finding petitioner [ANGLO-KMU] as having complied with the
requirements of registration at the time of filing of the petition and remanding the records of this case
to the Regional Office of origin . . . ." 2
The National Federation of Labor thus filed this special civil action for certiorari under Rule 65 of the
Rules of Court raising the following grounds:
A. RESOLUTION OF PUBLIC RESPONDENT HON.
BIENVENIDO E. LAGUESMA DATED 8 AUGUST
1995 AND HIS ORDER DATED 14 SEPTEMBER
1995 WERE ISSUED IN DISREGARD OF EXISTING
LAWS AND JURISPRUDENCE; AND
B. GRAVELY ABUSED HIS DISCRETION IN
APPLYING THE RULING IN THE CASE OF FUR V.
LAGUESMA, G.R. NO. 109251, MAY 26, 1993, IN
THE PRESENT CASE.
We will not rule on the merits of the petition. Instead, we will take this opportunity to lay the rules on
the procedure for review of decisions or rulings of the Secretary of Labor and Employment under the
Labor Code and its Implementing Rules. (P.D. No. 442 as amended)
In St. Martin Funeral Homes v. National Labor Relations Commission and Bienvenido Aricayos, G.R.
No. 130866, September 16, 1998, the Court re-examined the mode of judicial review with respect to
decisions of the National Labor Relations Commission.
The course taken by decisions of the NLRC and those of the Secretary of Labor and Employment
are tangent, but all are within the umbra of the Labor Code of the Philippines and its implementing
rules. On this premise, we find that the very same rationale in St. Martin Funeral Homes
v. NLRC finds application here, leading ultimately to the same disposition as in that leading case.
We have always emphatically asserted our power to pass upon the decisions and discretionary acts
of the NLRC well as the Secretary of Labor in the face of the contention that no judicial review is
provided by the Labor Code. We stated in San Miguel Corporation v. Secretary of Labor 3 thus:
. . . It is generally understood that as to a administrative agencies exercising quasijudicial or legislative power there is an underlying power in the courts to scrutinize
the acts of such agencies on questions of law and jurisdiction even though no right of
review is given by statute (73 C.J.S. 506, note 56).
The purpose of judicial review is to keep the administrative agency within its
jurisdiction and protect substantial rights of parties affected by its decision (73 C.J.S.
507, Sec. 165). It is part of the system of checks and balances which restricts the
separation of powers and forestalls arbitrary and unjust adjudications.
Considering the above dictum and as affirmed by decisions of this Court, St. Martin Funeral Homes
v. NLRCsuccinctly pointed out, the remedy of an aggrieved party is to timely file a motion for
reconsideration as a precondition for any further or subsequent remedy, and then seasonably file a
special civil action for certiorari under Rule 65 of the 1997 Rules of Civil Procedure.
The propriety of Rule 65 as a remedy was highlighted in St. Martin Funeral Homes v. NLRC, where
the legislative history of the pertinent statutes on judicial review of cases decided under the Labor
Code was traced, leading to and supporting the thesis that "since appeals from the NLRC to the
Supreme Court were eliminated, the legislative intendment was that the special civil action
of certiorari was and still is the proper vehicle for judicial review of decision of the NLRC" 4 and
consequently "all references in the amended Section 9 of B.P. No. 129 to supposed appeals from the
NLRC to the Supreme Court are interpreted and hereby declared to mean and refer to petitions
for certiorari under Rule 65." 5
Proceeding therefrom and particularly considering that the special civil action of certiorari under Rule
65 is within the concurrent original jurisdiction of the Supreme Court and the Court of
Appeals, St. Martin Funeral Homes v. NLRCconcluded and directed that all such petitions should be
initially filed in the Court of Appeals in strict observance of the doctrine on the hierarchy of courts.
In the original rendering of the Labor Code, Art. 222 thereof provided that the decisions of the NLRC
are appealable to the Secretary of Labor on specified grounds. 6 The decisions of the Secretary of
Labor may be appealed to the President of the Philippines subject to such conditions or limitations as the
President may direct.
Thus under the state of the law then, this Court had ruled that original actions for certiorari and
prohibition filed with this Court against the decision of the Secretary of Labor passing upon the
decision of the NLRC were unavailing for mere error of judgment as there was a plain, speedy and
adequate remedy in the ordinary course of law, which was an appeal to the President. We said in the
1975 case, Scott v. Inciong, 7quoting Nation Multi Service Labor Union v.Acgoaili: 8 "It is also a matter of
significance that there was an appeal to the President. So it is explicitly provided by the Decree. That was
a remedy both adequate and appropriate. It was in line with the executive determination, after the
proclamation of martial law, to leave the solution of labor disputes as much as possible to administrative
agencies and correspondingly to limit judicial participation." 9
Significantly, we also asserted in Scott v. Inciong that while appeal did not lie, the corrective power of
this Court by a writ of certiorari was available whenever a jurisdictional issue was raised or one of
grave abuse of discretion amounting to a lack or excess thereof, citing San Miguel Corporation v.
Secretary of Labor. 10
P.D. No. 1367 11 amending certain provisions of the Labor Code eliminated appeals to the President, but
gave the President the power to assume jurisdiction over any cases which he considered national interest
cases. The subsequent P.D. No. 1391, 12 enacted "to insure speedy labor justice and further stabilize
industrial peace", further eliminated appeals from the NLRC to the Secretary of Labor but the President
still continued to exercise his power to assume jurisdiction over any cases which he considered national
interest
cases. 13
Though appeals from the NLRC to the Secretary of Labor were eliminated, presently there are
several instances in the Labor Code and its implementing and related rules where an appeal can be
filed with the Office of the Secretary of Labor or the Secretary of Labor issues a ruling, to wit:
(1) Under the Rules and Regulations Governing Recruitment and Placement
Agencies for Local Employment 14 dated June 5, 1997 superseding certain provisions of
Book I (Pre-Employment) of the implementing rules, the decision of the Regional Director
on complaints against agencies is appealable to the Secretary of Labor within ten (10)
working days from receipt of a copy of the order, on specified grounds, whose decision
shall be final and inappealable.
(2) Art. 128 of the Labor Code provides that an order issued by the duly authorized
representative of the Secretary of Labor in labor standards cases pursuant to his
visitorial and enforcement power under said article may be appealed to the Secretary
of Labor.
Sec. 2 in relation to Section 3 (a), Rule X, Book III (Conditions of Employment) of the
implementing rules gives the Regional Director the power to order and administer
compliance with the labor standards provisions of the Code and other labor
legislation. Section 4 gives the Secretary the power to review the order of the
Regional Director, and the Secretary's decision shall be final and executory.
Sec. 1, Rule IV (Appeals) of the Rules on the Disposition of Labor Standards Cases
in the Regional Offices dated September 16, 1987 15 provides that the order of the
Regional Director in labor standards cases shall be final and executory unless appealed
to the Secretary of Labor.
Sec. 5, Rule V (Execution) provides that the decisions, orders or resolutions of the
Secretary of Labor and Employment shall become final and executory after ten (10)
calendar days from receipt of the case records. The filing of a petition
for certiorari before the Supreme Court shall not stay the execution of the order or
decision unless the aggrieved party secures a temporary restraining order from the
Court within fifteen (15) calendar days from the date of finality of the order or
decision or posts a supersedeas bond.
Sec. 6 of Rule VI (Health and Safety Cases) provides that the Secretary of Labor at
his own initiative or upon the request of the employer and/or employee may review
the order of the Regional Director in occupational health and safety cases. The
Secretary's order shall be final and executory.
(2) Art. 236 provides that the decision of the Labor Relations Division in the regional
office denying an applicant labor organization, association or group of unions or
workers' application for registration may be appealed by the applicant union to the
Bureau of Labor Relations within ten (10) days from receipt of notice thereof.
Sec. 4, Rule V, Book V (Labor Relations), as amended by Department Order No. 9
dated May 1, 199716 provides that the decision of the Regional Office denying the
application for registration of a workers association whose place of operation is confined
to one regional jurisdiction, or the Bureau of Labor Relations denying the registration of a
federation, national or industry union or trade union center may be appealed to the
Bureau or the Secretary as the case may be who shall decide the appeal within twenty
(20) calendar days from receipt of the records of the case.
(3) Art. 238 provides that the certificate of registration of any legitimate organization
shall be canceled by the Bureau of Labor Relations if it has reason to believe, after
due hearing, that the said labor organization no longer meets one or more of the
requirements prescribed by law.
Sec. 4, Rule VIII, Book V provides that the decision of the Regional Office or the
Director of the Bureau of Labor Relations may be appealed within ten (10) days from
receipt thereof by the aggrieved party tothe Director of the Bureau or the Secretary of
Labor, as the case may be, whose decision shall be final and executory.
(4) Art. 259 provides that any party to a certification election may appeal the order or
results of the election as determined by the Med-Arbiter directly to the Secretary of
Labor who shall decide the same within fifteen (15) calendar days.
Sec. 12, Rule XI, Book V provides that the decision of the Med-Arbiter on the petition
for certification election may be appealed to the Secretary.
Sec. 15, Rule XI, Book V provides that the decision of the Secretary of Labor on an
appeal from the Med-Arbiter's decision on a petition for certification election shall be
final and executory. The implementation of the decision of the Secretary affirming the
decision to conduct a certification election shall not be stayed unless restrained by
the appropriate court.
Sec. 15, Rule XII, Book V provides that the decision of the Med-Arbiter on the results
of the certification election may be appealed to the Secretary within ten (10) days
from receipt by the parties of a copy thereof, whose decision shall be final and
executory.
Sec. 7, Rule XVIII (Administration of Trade Union Funds and Actions Arising
Therefrom), Book V provides that the decision of the Bureau in complaints filed
directly with said office pertaining to administration of trade union funds may be
appealed to the Secretary of Labor within ten (10) days from receipt of the parties of
a copy thereof.
Sec. 1, Rule XXIV (Execution of Decisions, Awards, or Orders), Book V provides that
the decision of the Secretary of Labor shall be final and executory after ten (10)
calendar days from receipt thereof by the parties unless otherwise specifically
provided for in Book V.
(5) Art. 263 provides that the Secretary of Labor shall decide or resolve the labor
dispute over which he assumed jurisdiction within thirty (30) days from the date of the
assumption of jurisdiction. His decision shall be final and executory ten (10) calendar
days after receipt thereof by the parties.
From the foregoing we see that the Labor Code and its implementing and related rules generally do
not provide for any mode for reviewing the decision of the Secretary of Labor. It is further generally
provided that the decision of the Secretary of Labor shall be final and executory after ten (10) days
from notice. Yet, like decisions of the NLRC which under Art. 223 of the Labor Code become final
after ten (10) days, 17 decisions of the Secretary of Labor come to this Court by way of a petition
for certiorari even beyond the ten-day period provided in the Labor Code and the implementing rules but
within the reglementary period set for Rule 65 petitions under the 1997 Rules of Civil Procedure. For
example, in M.Ramirez Industries v. Secretary of Labor, 18 assailed was respondent's order affirming the
Regional Director's having taken cognizance of a case filed pursuant to his visitorial powers under Art.
128 (a) of the Labor Code; in Samahang Manggagawa sa Permex v. Secretary of
Labor, 19 assailed was respondent's order setting aside the Med-Arbiter's dismissal a petition for
certification election;Samahan ng Manggagawa sa Pacific Plastic v. Laguesma, 20 assailed was
respondent's order affirming the Med-Arbiter's decision on the results of a certification election;
in Philtread Workers Union v. Confessor, 21 assailed was respondent's order issued under Art. 263
certifying a labor dispute to the NLRC for compulsory arbitration.
In two instances, however, there is specific mention of a remedy from the decision of the Secretary
of Labor, thus:
(1) Section 15, Rule XI, Book V of the amended implementing rules provides that the decision of the
Secretary of Labor on appeal from the Med-Arbiter's decision on a petition for certification election
shall be final and executory, but that the implementation of the Secretary's decision affirming the
Med-Arbiter's decision to conduct a certification election "shall not be stayed unless restrained by
the appropriate court."
(2) Section 5, Rule V (Execution) of the Rules on the Disposition of Labor Standards Cases in
Regional Offices provides that "the filing of a petition for certiorari before the Supreme Court shall
not stay the execution of the [appealed] order or decision unless the aggrieved party secures a
temporary restraining order from the Court."
We perceive no conflict with our pronouncements on the proper remedy which is Rule 65 and which
should be initially filed in the Court of Appeals in strict observance of the doctrine on the hierarchy of
courts. Accordingly, we read "the appropriate court" in Section 15, Rule XI, Book V of the
Implementing Rules to refer to the Court of Appeals.
Sec. 5, Rule V of the Rules on the Disposition of Labor Standards Cases in Regional Offices
specifying the Supreme Court as the forum for filing the petition for certiorari is not infirm in like
manner or similarly as is the statute involved in Fabian v. Desierto. 22 And Section 5 cannot be read to
mean that the petition for certiorari can only be filed exclusively and solely with this Court, as the provision
must invariably be read in relation to the pertinent laws on the concurrent original jurisdiction of this Court
and the Court of Appeals in Rule 65 petitions.
In fine, we find that it is procedurally feasible as well as practicable that petitions for certiorari under
Rule 65 against the decision of the Secretary of Labor rendered under the Labor Code and its
implementing and related rules be filed initially in the Court of Appeals. Paramount consideration is
strict observance of the doctrine on the hierarchy of the courts, emphasized in St. Martin Funeral
Homes v. NLRC, on "the judicial policy that this Court will not entertain direct resort to it unless the
redress desired cannot be obtained in the appropriate courts or where exceptional and compelling
circumstances justify availment of a remedy within and calling for the exercise of our preliminary
jurisdiction." 23
WHEREFORE, in view of the foregoing, certiorari, together with all pertinent records REFERRED to
the Court of Appeals for disposition.
SO ORDERED.
The deletion of the relief of reinstatement was justified by the NLRC in the following manner:
11
claim for financial assistance under the Mutual Aid Fund of the union." PSAU appealed to the Secretary of
Labor and Employment who, by Resolution dated July 25, 1990, denied the appeal but reduced the MedArbiter's award from P18,669.00 to P17,886.00. 17 Nullification of the Med-Arbiter's Order of April 16, 1990
and the respondent Secretary's Resolution of July 25, 1990 is the prayer sought by the petitioner in the
special civil action of certiorari at bar.
Resolving first the issue of whether or not the case at bar is within the original jurisdiction of the
Med-Arbiter of the Bureau of Labor Relations, the Court holds that it is.
The jurisdiction of the Bureau of Labor Relations and its Divisions is set forth in the first paragraph of
Article 226 of the Labor Code, as amended, viz.:
Art. 226. Bureau of Labor Relations. The Bureau of Labor Relations and the Labor
Relations Divisions in the regional offices of the Department of Labor shall have
original and exclusive authority to act, at their own initiative or upon request of either
or both parties, on all inter-union and intra-union conflicts, and all disputes,
grievances or problems arising from or affecting labor management relations in all
workplaces whether agricultural or non-agricultural, except those arising from the
implementation or interpretation of collective bargaining agreements which shall be
the subject of grievance procedure and/or voluntary arbitration.
xxx xxx xxx
It is evident that the case at bar does not concern a dispute, grievance or problem "arising from or
affecting labor-management relations." So, if it is to be deemed as coming within the Med-Arbiter's
jurisdiction, it will have to be as either an "intra-union" or "inter-union" conflict.
No definition is given by law of these precise terms, "intra-union and inter-union conflicts." It is
known, however, that "intra-" and "inter-" are both combining forms, prefixes the first, "intra-,"
meaning "within, inside of [intramural, intravenous];" and the other, "inter-, denoting "1. between or
among: the second element is singular in form [interstate] 2. with or on each other (or one another),
together, mutual, reciprocal, mutually, or reciprocally [interact]."18 An intra-union conflict would
therefore refer to a conflict within or inside a labor union conflict would therefore refer to a conflict within
or inside a labor union, and an inter-union controversy or dispute, one occurring or carried on between or
among unions. In this sense, the controversy between Alisasis and his union, PSAU respecting the
former's rights under the latter's "Mutual Aid Plan" would be an intra-union conflict under Article 226 of
the Labor Code and hence, within the exclusive, original jurisdiction of the Med-Arbiter of the Bureau of
Labor Relations whose decision, it may additionally be mentioned, is appealable to the Secretary of
Labor.
Certainly, said controversy is not one of those within the jurisdiction of the Labor Arbiters in
accordance with Article 217 of the Code, it not being an unfair labor practice case, or a termination
dispute, or one involving wages, rates of pay, hours of work and other terms and conditions of
employment (which is "accompanied with a claim for reinstatement"), or one for damages arising
from the employer-employee relations, or one for a violation of Article 264 of the Code, or any other
claim arising from employer-employee relations, or from the interpretation or implementation of a
collective bargaining agreement or of company personnel policies.
The second issue relates to the character of Alisasis' dismissal from employment. The Court holds
that Alisasis had indeed been "dismissed for cause." His employer had established this factual
proposition by competent evidence to the satisfaction of both the Labor Arbiter and the National
Labor Relations Commission. In the Latter's view, and in its own words, "Certainly, with the
actuations of complainant, . . (Alisasis' employer) had ample reason or enough basis to lose trust
and confidence in him . . . considering that (said employer) had already lost trust and confidence in
complainant which is founded on a reasonable ground, as discussed earlier, (and therefore) there is
no point in requiring respondent to reinstate complainant to his former position . . (as to) do so would
be tantamount to compelling the management to employ someone whom it can no longer trust,
which is oppressive."
It was merely "the manner in which such a dismissal from employment was effected . . (that was
deemed as) not in accordance with law, (there having been) failure to comply with the notice
requirement under Batas Pambansa Blg. 130 on termination of employees." That imperfection is,
however, a circumstance quite distinct from the existence of what the NLRC has clearly and
expressly conceded to be a "valid and lawful cause in the dismissal of complainant by respondent."
And this is precisely the reason why, as already pointed out, the NLRC declined to accord to Alisasis
all the remedies or reliefs usually attendant upon an illegal termination of employment e.g.,
reinstatement, award of damages although requiring payment by the employer of the sum of
P1,000.00 simply on account of its failure "to comply with the notice requirement under Batas
Pambansa Blg. 130 on termination of employees." The situation is on all fours with that in
the Wenphil Corporation Case, 19 cited in this opinion's opening paragraph, in which the following
pronouncements, among others, were made:
Thus in the present case, where the private respondent, who appears to be of violent
temper, caused trouble during office hours and even defied his superiors as they
tried to pacify him, should not be rewarded with re-employment and back wages. It
may encourage him to do even worse and will render a mockery of the rules of
discipline that employees are required to observe. Under the circumstancesthe
dismissal of the private respondent for just cause should be maintained. He has no
right to return to his former employer.
However, the petitioner (employer) must nevertheless be held to account for failure to
extend to private respondent his right to an investigation before causing his
dismissal. . . Thus, it must be imposed a sanction for its failure to give a formal notice
and conduct an investigation as required by law before dismissing . . (respondent)
from employment. Considering the circumstances of this case petitioner (employer)
must indemnify the private respondent (employee) the amount of P1,000.00. The
measure of this award depends on the facts of each case and the gravity of the
omission committed by the employer.
The petitioner union (PSAU) was therefore quite justified in considering Alisasis as a "member
dismissed for cause," and hence disqualified under its amended by-laws to claim any "Benefit or
return of contributions . . under any circumstances, . . ." The ruling to the contrary of the Med-Arbiter
and the Secretary of Labor and Employment must thus be set aside as tainted with grave abuse of
discretion.
WHEREFORE, the petition is granted and the writ of certiorari prayed for issued, NULLIFYING and
SETTING ASIDE the challenged Order of the Med-Arbiter dated April 16, 1990 and the Resolution of
the respondent Secretary of Labor and Employment dated July 25, 1990, and DIRECTING THE
DISMISSAL of Alisasis' complaint in NLRC Case No. NCR-Od-M-90-01-037, without pronouncement
as to costs.
SO ORDERED.
[2]
[3]
Relations. This case was docketed as Case No. OD-M-9604-006. ABBOTT assailed
the certificate of registration since ALEU's application was not signed by at least 20%
of the total 286 rank-and-file employees of the entire employer unit; and that it
omitted to submit copies of its books of account.
On 21 June 1996, the Regional Director of the Bureau of Labor Relations decreed the
cancellation of ALEU's registration certificate No. NCR-UR-II-1585-95. In its
decision, the Regional Director adopted the 13 June 1996 findings and
recommendations of the Med-Arbiter. It ruled that the union has failed to sliow that
the rank-and-file employees in the manufacturing unit of ABBOTT were bound by a
common interest to justify the formation of a bargaining unit separate from those
belonging to the sales and office staff units. There was, therefore, sufficient reason to
assume that the entire membership of the rank-and-file consisting of 286 employees or
the "employer unit" make up the appropriate bargaining unit. However, it was clear on
the record that the union's application for registration was supported by 30 signatures
of its members or barely constituting 10% of the entire rank-and-file employees of
ABBOTT. Thus the Regional Director found that for ALEU's failure to satisfy the
requirements of union registration under Article 234 of the Labor Code; the
cancellation of its certificate of registration was in order.
[7]
[8]
[9]
On 31 March 1997, the Bureau of Labor Relations rendered judgment reversing the
21 June 1996 decision of the Regional Director, thus:
[11]
It gave the following reasons to justify the reversal: ( 1) Article 234 of the Labor Code
does not require an applicant union to show proof of the "desirability of more than
one Ibargaining unit within an employer unit," and the absence of such proof is not a
ground for the cancellation of a union's registration pursuant to Article 239 of Book V,
Rule II of the implementing rules of the Labor Code; (2) the issue pertaining to the
appropriateness of a bargaining unit cannot be raised in a cancellation proceeding but
may be threshed out in the exclusion-inclusion process during a certification election;
and (3) the "one-bargaining unit, one-employer unit policy" must not be interpreted in
a manner that shall derogate the right of the employees to self-organization and
freedom of association as guaranteed by Article III, Section 8 of the 1987 Constitution
and Article II of the International Labor Organization's Convention
No.87.
Its motion to reconsider the 31 March 1997 decision of the Bureau of Labor Relations
having been denied for lack of merit in the Order of 9 July 1997, ABBOTT appealed
to the Secretary of Labor and Employment. However, in its letter dated 19 September
1997, addressed to ABBOTT's counsel, the Secretary of Labor and Employment
refused to act on ABBOTT's appeal on the ground that it has no jurisdiction to review
the decision of the Bureau of Labor Relations on iappeals in cancellation cases
emanating from the Regional Offices. The decision of the Bureau of Labor Relations
therein is final and executory under Section 4, Rule III, Book V of the Rules and
Regulations Implementing thc Labor Code, as amended by Department Order No. 09,
s. of 1997. Finally, the Secretary stated:
[13]
[14]
It has always been the policy of this Office that pleadings denominated
as appeal thereto over decisions of the BLR in cancellation cases coming
from the Regional Offices are referred back to the BLR, so that the same
may be treated as motions for reconsideration and disposed of
accordingly. However, since your office has already filed a motion for
reconsideration with the BLR which has been denied in its Order dated
09 July 1997, your recourse should have been a special civil action
for certiorari with the Supreme Court.
In view of the foregoing, please be informed that the Office of the
Secretary cannot act upon your Appeal, except to cause the BLR to
include it in the records of the case.
Hence, this petition. ABBOTT premised its argument on the authority of the Secretary
of Labor and Employment to review the decision of the Bureau of Labor Relations
and at the same time raised the issue on the validity of ALEU's certificate of
registration.
We find no merit in this petition.
At the outset, it is wortl1y to note that the present petition assails only the letter of the
then Secretary of Labor & Employment refusing to take cognizance of ABBOTT's
appeal for lack of appellate jurisdiction. Hence, in the resolution of the present
petition, it is just appropriate to limit the issue on the power of the Secretary of Labor
and Employment to review the decisions of the Bureau of Labor Relations rendered in
the exercise of its appellate jurisdiction over decisions of the Regional Director in
cases involving cancellations of certificates of registration of labor unions. The issue
anent the validity of ALEU's certificate of registration is subject of the Bureau of
Labor Relations decision dated 31 March 1997. However, said decision is not being
assailed in the present petition; hence, we are not at liberty to review the
same.
Contrary to ABBOTT's contention, there has been no grave abuse of discretion on the
part of the Secretary of Labor and Employment. Its refusal to take cognizance of
ALEU's appeal from the decision of the Bureau of Labor Relations is in accordance
with the provisions of Rule VIII, Book V of the Omnibus Rules Implementing the
Labor Code as amended by Department Order No. 09. The rule governing petitions
for cancellation of registration of any legitimate labor organization or worker
association, as it now stands, provides:
[15]
From the foregoing, the Office of the Secretary correctly maintained that
it cannot take cognizance of petitioner's appeal from the decision of BLR
It is clear then that the Secretary of Labor and Employment did not commit grave
abuse of discretion in not acting on ABBOTT's appeal. The decisions of the Bureau of
Labor Relations on cases brought before it on appeal from the Regional Director are
final and executory. Hence, the remedy of the aggrieved party is to seasonably avail of
the special civil action of certiorari under Rule 65 of the Rules of Court.
[19]
Even if we relaxed the rule and consider the present petition as a petition
for certiorari not only of the letter of the Secretary of Labor and Employment but also
of the decision of the Bureau of the Labor Relations which overruled the order of
cancellation of ALEU's certificate of registration, the same would still be dismissable
for being time-barred. Under Sec. 4 of Rule 65 of the 1997 Revised Rules of Court the
special civil action forcertiorari should be instituted within a period of sixty (60) days
from notice of the judgment, order or resolution sought to be assailed. ABBOTT
received the decision of the Bureau of Labor Relations on 14 April 1997 and the order
denying its motion for reconsideration of the said decision on 16 July 1997. The
present petition was only filed on 28 November 1997, after the laps of more than four
months. Thus, for failure to avail of the correct remd4y within the period provided by
law, the decision of the Bureau of Labor Relations has become final and executory.
WHEREFORE, the Petition is DENIED. The challenged order in BLR-A-10-25-96
of the Secretary of Labor and Employment embodied in its 19 September letter is
hereby AFFIRMED.
SO ORDERED.
22 Okt. 1987
Mr. Elieze Hao
Master Iron Works & Construction Corp.
790 Bagbagin, Caloocan City
Dear Sir:
Ang unyon, sa pamamagitan ng nakalagda sa ibaba, ay nagmumungkahi,
nagsusuhestiyon o nag-oofer sa inyong pangasiwaan ng aming kahilingan na
bumalik na sa trabaho dahilan din lang sa kalagayan na tuloy tuloy ang ating paguusap para sa ikatitiwasay ng ating relasyon. Gusto naming manatili ang ating
magandang pagtitinginan bilang magkasangga para sa ika-uunlad ng ating
kumpanya. Sana ay unawain niyo kami dahil kailangan namin ng trabaho.
Gumag
alang,
(Sgd.)
WILFREDO
ABULENCIA
Pangulo
(Rollo, p. 590)
On October 30, 1987, MILU filed a position paper with counter-complaint before the NLRC. In said
counter-complaint, the workers charged the Corporation with unfair labor practice for
subcontracting work that was normally done by its regular workers thereby causing the reduction of
the latter's workdays; illegal suspension of Abulencia without any investigation; discrimination for
hiring casual workers in violation of the CBA, and illegal dispersal of the picket lines by CAPCOM
agents (Rollo, pp. 26-27).
In due course, a decision dated March 16, 1988 was rendered by Labor Arbiter Fernando Cinco
declaring illegal the strike staged by MILU. The dispositive portion of the decision reads:
WHEREFORE, in the light of the foregoing premises, judgment is hereby rendered,
as follows:
1. Declaring the strike by the respondents illegal and unlawful;
2. Ordering the cancellation of the registered permit of respondent union MILU for
having committed an illegal strike;
declaration of illegality of the strike and the termination of employment of certain employees and the
rest of the dispositive portion of the labor arbiter's decision (Rollo, pp. 48-49).
In his dissent, Commissioner Lucas stated that he is "for the setting aside of the decision appealed
from, and remanding of the case to the labor arbiter of origin, considering the respondent's
countercharge or complaint for unfair labor practice was not resolved on the merits" (Rollo, p. 49).
MILU filed a motion for the reconsideration but the same was denied by the NLRC for lack of merit in
its Resolution of August 9, 1989 (Rollo, p. 50). Hence, the instant petition. 1
Petitioners contend that notwithstanding the non-strike provision in the CBA, the strike they staged
was legal because the reasons therefor are non-economic in nature. They assert that the NLRC
abused its discretion in holding that there was "failure to exhaust the provision on grievance
procedure" in view of the fact that they themselves sought grievance meetings but the Corporation
ignored such requests. They charge the NLRC with bias in failing to give weight to the fact that the
criminal charges against the individual petitioners were dismissed for failure of the CAPCOM
soldiers to testify while the same individual strikers boldly faced the charges against them. Lastly,
they aver that the NLRC abused its discretion in holding that the workers' offer to return to work was
conditional.
In holding that the strike was illegal, the NLRC relied solely on the no-strike no-lockout provision of
the CBA aforequoted. As this Court has held in Philippine Metal Foundries, Inc. vs. CIR (90 SCRA
135 [1979]), a no-strike clause in a CBA is applicable only to economic strikes. Corollarily, if the
strike is founded on an unfair labor practice of the employer, a strike declared by the union cannot be
considered a violation of the no-strike clause.
An economic strike is defined as one which is to force wage or other concessions from the employer
which he is not required by law to grant (Consolidated Labor Association of the Philippines vs.
Marsman & Co., Inc., 11 SCRA 589 [1964]). In this case, petitioners enumerated in their notice of
strike the following grounds: violation of the CBA or the Corporation's practice of subcontracting
workers; discrimination; coercion of employees; unreasonable suspension of union officials, and
unreasonable refusal to entertain grievance.
Private respondent contends that petitioner's clamor for the implementation of Section 2, Article VIII
of the CBA on service allowances granted to workers who are assigned outside the company
premises is an economic issue (Rollo, p. 70). On the contrary, petitioners decry the violation of the
CBA, specifically the provision granting them service allowances. Petitioners are not, therefore,
already asking for an economic benefit not already agreed upon, but are merely asking for the
implementation of the same. They aver that the Corporation's practice of hiring subcontractors to do
jobs outside of the company premises was a way "to dodge paying service allowance to the
workers" (Rollo, pp. 61 & 70).
Much more than an economic issue, the said practice of the Corporation was a blatant violation of
the CBA and unfair labor practice on the part of the employer under Article 248(i) of the Labor
Code. Although the end result, should the Corporation be required to observe the CBA, may be
economic in nature because the workers would then be given their regular working hours and
therefore their just pay, not one of the said grounds is an economic demand within the meaning of
the law on labor strikes. Professor Perfecto Fernandez, in his
book Law on Strikes,Picketing and Lockouts (1981 edition, pp. 144-145), states that an economic
strike involves issues relating to demands for higher wages, higher pension or overtime rates,
pensions, profit sharing, shorter working hours, fewer work days for the same pay, elimination of
night work, lower retirement age, more healthful working conditions, better health services, better
sanitation and more safety appliances. The demands of the petitioners, being covered by the CBA,
are definitely within the power of the Corporation to grant and therefore the strike was not an
economic strike.
The other grounds, i.e., discrimination, unreasonable suspension of union officials and unreasonable
refusal to entertain grievance, had been ventilated before the Labor Arbiter. They are clearly unfair
labor practices as defined in Article 248 of the Labor Code. 2 The subsequent withdrawal of petitioners'
complaint for unfair labor practice (NLRC-NCR Case No. 00-11-04132-87) which was granted by Labor
Arbiter Ceferina Diosana who also considered the case closed and terminated (Rollo, pp. 97 & 109) may
not, therefore, be considered as having converted their other grievance into economic demands.
Moreover, petitioners staged the strike only after the Corporation had failed to abide by the
agreement forged between the parties upon the intervention of no less than the DOLE after the
union had complained of the Corporation's unabated subcontracting of workers who performed the
usual work of the regular workers. The Corporation's insistence that the hiring of casual employees
is a management prerogative betrays its attempt to coat with legality the illicit curtailment of its
employees' rights to work under the terms of the contract of employment and to a fair
implementation of the CBA.
While it is true that an employer's exercise of management prerogatives, with or without reason,
does not per seconstitute unjust discrimination, such exercise, if clearly shown to be in grave abuse
of discretion, may be looked into by the courts (National Federation of Labor Unions vs. NLRC, 202
SCRA 346 [1991]). Indeed, the hiring, firing, transfer, demotion, and promotion of employees are
traditionally identified as management prerogatives. However, they are not absolute prerogatives.
They are subject to limitations found in law, a collective bargaining agreement, or general principles
of fair play and justice (University of Sto. Tomas vs. NLRC, 190 SCRA 758 [1990] citing Abbott
Laboratories [Phil.], Inc. vs. NLRC, 154 SCRA 713 [1987]). The Corporation's assertion that it was
exercising a management prerogative in hiring outside workers being contrary to the contract of
employment which, of necessity, states the expected wages of the workers, as well as the CBA, is
therefore untenable.
Private respondent's failure to traverse petitioners' allegations that the NLRC abused its discretion in
holding that the provision on grievance procedure had not been exhausted clearly sustains such
allegation and upholds the petitioners' contention that the Corporation refused to undergo said
procedure. It should be remembered that a grievance procedure is part of the continuous process of
collective bargaining (Republic Savings Bank. vs. CIR, et al., 21 SCRA 226 [1967]). It is intended to
promote a friendly dialogue between labor and management as a means of maintaining industrial
peace. The Corporation's refusal to heed petitioners' request to undergo the grievance procedure
clearly demonstrated its lack of intent to abide by the terms of the CBA.
Anent the NLRC's finding that Abulencia's offer to return to work is conditional, even a cursory
reading of the letter aforequoted would reveal that no conditions had been set by petitioners. It is
incongruous to consider as a "condition" the statement therein that the parties would continue talks
for a peaceful working relationship ("tuloy tuloy ang ating pag-uusap sa ikatitiwasay ng ating
relasyon"). Conferences form part of the grievance procedure and their mere mention in Abulencia's
letter did not make the same "conditional".
In the same manner, the following findings of the Labor Arbiter showed the illegal breakup of the
picket lines by the CAPCOM:
d) On 28 July 1987, CAPCOM soldiers, on surveillance mission, arrived at the picket
line of respondents and searches were made on reported deadly weapons and
firearms in the possession of the strikers. Several bladed weapons and firearms in
the possession of the strikers were confiscated by the CAPCOM soldiers, as a result
of which, the apprehended strikers were brought to Camp Tomas Karingal in Quezon
City for proper investigation and filing of the appropriate criminal charges against
them. The strikers who were charged of illegal possession of deadly weapon and
firearms were: Edgar Aranes, Wilfredo Abulencia, Ernesto dela Cruz, Beato
Abogado, Lopito Saranilla, Restituto Payabyab, Jose Borromeo and Rogelio Cabana.
Criminal informations were filed by Inquest Fiscal, marked as Exhibits "E", "E-1 to E8". These strikers were jailed for sometime until they were ordered release after
putting up the required bail bond. Other strikers were also arrested and brought to
Camp Tomas Karingal, and after proper investigation as to their involvement in the
offense charged, they were released for lack of prima facie evidence. They were
Edwin Velarde, Bayani Perez, Daniel Bacolon, Jesus Moises, Robert Aspurias and
Benigno Barcena.
After the strikers who were arrested were brought to Camp Tomas Karingal on 28
July 1987, the rest of the strikers removed voluntarily their human and material
barricades which were placed and posted at the road leading to the premises of the
Company. (Rollo, p. 32)
The bringing in of CAPCOM soldiers to the peaceful picket lines without any reported outbreak of
violence, was clearly in violation of the following prohibited activity under Article 264 of the Labor
Code:
(d) No public official or employee, including officers and personnel of the New Armed
Forces of the Philippines or the Integrated National Police, or armed person, shall
bring in, introduce or escort in any manner any individual who seeks to replace
strikers in entering or leaving the premises of a strike area, or work in place of the
strikers. The police force shall keep out of the picket lines unless actual violence or
other criminal acts occur therein; Provided, That nothing herein shall be interpreted
to prevent any public officer from taking any measure necessary to maintain peace
and order, protect life and property, and/or enforce the law and legal order.
(Emphasis supplied.)
As the Labor Arbiter himself found, no pervasive or widespread coercion or violence were
perpetrated by the petitioners as to warrant the presence of the CAPCOM soldiers in the picket lines.
In this regard, worth quoting is the following excerpt of the decision in Shell Oil Workers' Union
vs. Shell Company of the Philippines, Ltd., 39 SCRA 276 [1971], which was decided by the Court
under the old Industrial Peace Act but which excerpt still holds true:
. . . What is clearly within the law is the concerted activity of cessation of work in
order that . . . employer cease and desist from an unfair labor practice. That the law
recognizes as a right. There is though a disapproval of the utilization of force to attain
such an objective. For implicit in the very concept of the legal order is the
maintenance of peaceful ways. A strike otherwise valid, if violent in character, may be
placed beyond the pale. Care is to be taken, however, especially where an unfair
labor practice is involved, to avoid stamping it with illegality just because it is tainted
with such acts. To avoid rendering illusory the recognition of the right to strike,
responsibility in such a case should be individual and not collective. A different
conclusion would be called for, of course, if the existence of force while the strike
lasts is pervasive and widespread, consistently and deliberately resorted to as a
matter of policy. It could be reasonably concluded then that even if justified as to
ends, it becomes illegal because of the means employed. (at p. 292.)
All told, the strike staged by the petitioners was a legal one even though it may have been called to
offset what the strikers believed in good faith to be unfair labor practices on the part of the employer
(Ferrer, et al. vs. Court of Industrial Relations, et al., 17 SCRA 352 [1966]). Verily, such presumption
of legality prevails even if the allegations of unfair labor practices are subsequently found out to be
untrue (People's Industrial and Commercial Employees and Workers Org. [FFW] vs. People's
Industrial and Commercial Corporation, 112 SCRA 440 [1982]). Consonant with these jurisprudential
pronouncements, is Article 263 of the Labor Code which clearly states "the policy of the State to
encourage free trade unionism and free collective bargaining". Paragraph (b) of the same article
guarantees the workers' "right to engage in concerted activities for purposes of collective bargaining
or for their mutual benefit and protection" and recognizes the "right of legitimate labor organizations
to strike and picket and of employers to lockout" so long as these actions are "consistent with the
national interest" and the grounds therefor do not involve inter-union and intra-union disputes.
The strike being legal, the NLRC gravely abused its discretion in terminating the employment of the
individual petitioners, who, by operation of law, are entitled to reinstatement with three years
backwages. Republic Act No. 6715 which amended Art. 279 of the Labor Code by giving "full
backwages inclusive of allowances" to reinstated employees, took effect fifteen days from the
publication of the law on March 21, 1989. The decision of the Labor Arbiter having been promulgated
on March 16, 1988, the law is not applicable in this case.
WHEREFORE, the questioned decision and resolution of the NLRC as well as the decision of the
Labor Arbiter are hereby SET ASIDE and the individual petitioners are reinstated to their positions,
with three years backwages and without loss of seniority rights and other privileges. Further,
respondent corporation is ordered to desist from subcontracting work usually performed by its
regular workers.
SO ORDERED.
At bar is a Petition for Certiorari under Rule 65 of the Revised Rules of Court, assailing
the Resolution[1] of the National Labor Relations Commission in NLRC NCR CASE NO.
00094-90, which dismissed the complaint of San Miguel Corporation (SMC), seeking to dismiss
the notice of strike given by the private respondent union and to compel the latter to comply with
the provisions of the Collective Bargaining Agreement(CBA)[2] on grievance machinery,
arbitration, and the no-strike clause, with prayer for the issuance of a temporary restraining order.
The antecedent facts are as follows:
In July 1990, San Miguel Corporation, alleging the need to streamline its operations due to
financial losses, shut down some of its plants and declared 55 positions as redundant, listed as
follows: seventeen (17)employees in the Business LOGISTICS Division (BLD),
seventeen (17) in the Ayala Operations Center (AOC), and eighteen (18) in the MagnoliaManila Buying Station (Magnolia-MBS).[3] Consequently, the private respondent union filed
several grievance cases for the said retrenched employees, praying for the redeployment of the
said employees to the other divisions of the company.
The grievance proceedings were conducted pursuant to Sections 5 and 8, Article VIII of the
parties 1990 Collective Bargaining Agreement providing for the following procedures, to wit:
working days from the receipt of the written grievance. A copy of the decision shall
be furnished the Plant Personnel Officer.
Step 2. - If the decision in Step 1 is rejected, the employee concerned may elevate or
appeal this in writing to the Plant Manager/Director or his duly authorized
representative within twenty (20) working days from the receipt of the Decision of the
Department Manager. Otherwise, the decision in Step 1 shall be deemed accepted by
the employee.
The Plant Manager/Director assisted by the Plant Personnel Officer shall determine
the necessity of conducting grievance meetings. If necessary, the Plant
Manager/Director and the Plant Personnel Officer shall meet the employee
concerned and the Union Director/Steward on such date(s) as may be designated by
the Plant Manager. In every plant/office, Grievance Meetings shall be scheduled at
least twice a month.
The Plant Manager shall give his written comments and decision within ten (10)
working days after his receipt of such grievance or the date of submission of the
grievance for resolution, as the case may be. A copy of his Decision shall be
furnished the Employee Relations Directorate.
Step 3. - If no satisfactory adjustment is arrived at Step 2, the employee may appeal
the Decision to the Conciliation Board as provided under Section 6 hereof, within
fifteen (15) working days from the date of receipt of the decision of the Plant
Manager/Director or his designate. Otherwise, the decision in Step 2 shall be
deemed accepted by the employee.
The Conciliation Board shall meet on the grievance in such dates as shall be
designated by the Division/Business Unit Manager or his representative. In every
Division/Business Unit, Grievance Meetings of the Conciliation Board shall be
scheduled at least once a month.
The Conciliation Board shall have fifteen (15) working days from the date of
submission of the grievance for resolution within which to decide on the grievance.
SEC. 6. Conciliation Board. - There shall be a conciliation Board per Business Unit
or Division. Every Conciliation Board shall be composed of not more than five (5)
representatives each from the Company and the Union. Management and the Union
may be assisted by their respective legal counsels.
In every Division/Business Unit, the names of the Company and Union
representatives to the Conciliation Board shall be submitted to the Division/Business
Unit Manager not later than January of every year. The Conciliation Board members
shall act as such for one (1) year until removed by the Company or the Union, as the
case may be.
xxx
Sec. 8. Submission to Arbitration. - If the employee or Union is not satisfied with the
Decision of the Conciliation Board and desires to submit the grievance to arbitration,
the employee or the Union shall serve notice of such intention to the Company within
fifteen (15) working days after receipt of the Boards decision. If no such written
notice is received by the Company within fifteen (15) working days, the grievance
shall be considered settled on the basis of the companys position and shall no longer
be available for arbitration.[4]
During the grievance proceedings, however, most of the employees were redeployed, while
others accepted EARLY RETIREMENT . As a result only 17 employees remained when the
parties proceeded to the third level (Step 3) of the grievance procedure. In a meeting on October
26, 1990, petitioner informed private respondent union that if by October 30, 1990, the
remaining 17 employees could not yet be redeployed, their services would be terminated on
November 2, 1990. The said meeting adjourned when Mr. Daniel S. L. Borbon II, a
representative of the union, declared that there was nothing more to discuss in view of
the deadlock.[5]
On November 7, 1990, the private respondent filed with the National Conciliation and
Mediation Board (NCMB) of the Department of Labor and Employment (DOLE) a notice of
strike on the following grounds: a)bargaining deadlock; b) union busting; c) gross violation of
the Collective Bargaining Agreement (CBA), such as non-compliance with the grievance
procedure; d) failure to provide private respondent with a list of vacant positions pursuant to the
parties side agreement that was appended to the 1990 CBA; and e) defiance of voluntary
arbitration award. Petitioner on the other hand, moved to dismiss the notice of strike but the
NCMB failed to act on the motion.
On December 21, 1990, petitioner SMC filed a complaint [6] with the respondent NLRC,
praying for: (1) the dismissal the notice of strike; (2) an order compelling the respondent union
to submit to grievance and arbitration the issue listed in the notice of strike; (3) the recovery of
the expenses of litigation.
On April 16, 1991, respondent NLRC came out with a minute resolution dismissing the
complaint; holding, thus:
I
IT IS THE POSITIVE LEGAL DUTY OF RESPONDENT NLRC TO COMPEL
ARBITRATION AND TO ENJOIN A STRIKE IN VIOLATION OF A NO
STRIKE CLAUSE.
II
INJUNCTION IS THE ONLY IMMEDIATE, EFFECTIVE SUBSTITUTE FOR THE
DISASTROUS ECONOMIC WARFARE THAT ARBITRATION IS DESIGNED TO
AVOID.[8]
On June 3, 1991, to preserve the status quo, the Court issued a Resolution[9] granting
petitioners prayer for the issuance of a Temporary Restraining Order.
The Petition is impressed with merit.
Rule XXII, Section I, of the Rules and Regulations Implementing Book V the Labor Code [10],
reads:
Section 1. Grounds for strike and lockout. -- A strike or lockout may be declared in
cases of bargaining deadlocks and unfair labor practices. Violations of the collective
bargaining agreements, except flagrant and/or malicious refusal to comply with its
economic provisions, shall not be considered unfair labor practice and shall not be
strikeable. No strike or lockout may be declared on grounds involving inter-union
and intra-union disputes or on issues brought to voluntary or compulsory
arbitration.
In the case under consideration, the grounds relied upon by the private respondent union are
non-strikeable. The issues which may lend substance to the notice of strike filed by the private
respondent union are: collective bargaining deadlock and petitioners alleged violation of the
collective bargaining agreement. These grounds, however, appear more illusory than real.
Collective Bargaining Deadlock is defined as the situation between the labor and the
management of the company where there is failure in the collective bargaining negotiations
resulting in a stalemate[11] This situation, is non-existent in the present case since there is a
Board assigned on the third level (Step 3) of the grievance machinery to resolve the conflicting
views of the parties. Instead of asking the Conciliation Board composed of five representatives
each from the company and the union, to decide the conflict, petitioner declared a deadlock, and
thereafter, filed a notice of strike. For failing to exhaust all the steps in the grievance machinery
and arbitration proceedings provided in the Collective Bargaining Agreement, the notice of strike
should have been dismissed by the NLRC and private respondent union ordered to proceed with
the grievance and arbitration proceedings. In the case of Liberal Labor Union vs. Phil. Can Co.,
[12]
the court declared as illegal the strike staged by the union for not complying with the
grievance procedure provided in the collective bargaining agreement, ruling that:
This petition for review on certiorari seeks to annul and set aside the
decision[1] of the Court of Appeals promulgated on July 6, 1999 and its Order
denying petitioners motion for reconsideration in CA-G.R. SP No. 44341.
The relevant facts as substantially recited by the Court of Appeals in its
decision are as follows:
Petitioner LUDO & LUYM CORPORATION (LUDO for brevity) is a
domestic corporation engaged in the manufacture of COCONUT OIL , corn
starch, glucose and related products. It operates a manufacturing plant located
at Tupas Street, Cebu City and a wharf where raw materials and finished
products are shipped out.
In the course of its business operations, LUDO engaged the arrastre
services of Cresencio Lu Arrastre Services (CLAS) for the loading and
unloading of its finished products at the wharf. Accordingly, several arrastre
workers were deployed by CLAS to perform the services needed by LUDO.
These arrastre workers were subsequently hired, on different dates, as
regular rank-and-file employees of LUDO every time the latter needed
additional manpower services. Said employees thereafter joined respondent
union, the LUDO Employees Union (LEU), which acted as the exclusive
bargaining agent of the rank-and-file employees.
On April 13, 1992, respondent union entered into a collective bargaining
agreement with LUDO which provides certain benefits to the employees, the
amount of which vary according to thelength of service rendered by the
availing employee.
Thereafter, the union requested LUDO to include in its members period of
service the time during which they rendered arrastre services to LUDO
through the CLAS so that they could get higher benefits. LUDO failed to act
on the request. Thus, the matter was submitted for voluntary arbitration.
The parties accordingly executed a submission agreement raising the sole
issue of the date of regularization of the workers for resolution by the
Voluntary Arbitrator.
In its decision dated April 18, 1997, the Voluntary Arbitrator ruled that: (1)
the respondent employees were engaged in activities necessary and
desirable to the business of petitioner, and (2) CLAS is a labor-only contractor
of petitioner.[2] It disposed of the case thus:
WHEREFORE, in view of the foregoing, this Voluntary Arbitrator finds the claims of
the complainants meritorious and so hold that:
a.
the 214 complainants, as listed in the Annex A, shall be considered regular
employees of the respondents six (6) months from the first day of service at CLAS;
b.
the said complainants, being entitled to the CBA benefits during the regular
employment, are awarded a) sick leave, b) vacation leave & c) annual wage
and salary increases during such period in the amount of FIVE MILLION SEVEN
HUNDRED SEVEN THOUSAND TWO HUNDRED SIXTY ONE PESOS AND
SIXTY ONE CENTAVOS (P5,707,261.61) as computed in Annex A;
c.
the respondents shall pay attorneys fees of ten (10) percent of the total award;
d.
an interest of twelve (12) percent per annum or one (1) percent per month shall
be imposed to the award from the date of promulgation until fully paid if only to
speed up the payment of these long over due CBA benefits deprived of the
complaining workers.
Accordingly, all separation and/or RETIREMENT BENEFITS shall be construed
from the date of regularization aforementioned subject only to the appropriate
government laws and other social legislation.
SO ORDERED.[3]
In due time, LUDO filed a motion for reconsideration, which was
denied. On appeal, the Court of Appeals affirmed in toto the decision of the
Voluntary Arbitrator, thus:
WHEREFORE, finding no reversible error committed by respondent voluntary
arbitrator, the instant petition is hereby DISMISSED.
SO ORDERED.[4]
Hence this petition. Before us, petitioner raises the following issues:
I
Art. 217. Jurisdiction of Labor Arbiters and the Commission. --- (a) Except as
otherwise provided under this Code the Labor Arbiters shall have original and
exclusive jurisdiction to hear and decide, within thirty (30) calendar days after the
submission of the case by the parties for decision without extension, even in the
absence of stenographic notes, the following cases involving all workers, whether
agricultural or non-agricultural:
1. Unfair labor practice cases:
2. Termination disputes;
3. If accompanied with a claim for reinstatement, those cases that workers may file
involving wage, rates of pay, hours of work and other terms and conditions of
employment;
4. Claims for actual, moral, exemplary and other forms of damages arising from the
employer-employee relations;
xxx
Art. 261. Jurisdiction of Voluntary Arbitrators or panel of Voluntary
Arbitrators. The Voluntary Arbitrator or panel of Voluntary Arbitrators shall have
original and exclusive jurisdiction to hear and decide all unresolved grievances arising
from the interpretation or implementation of the Collective Bargaining Agreement
and those arising from the interpretation or enforcement of company personnel
policies referred to in the immediately preceding article. Accordingly, violations of a
Collective Bargaining Agreement, except those which are gross in character, shall no
longer be treated as unfair labor practice and shall be resolved as grievances under the
Collective Bargaining Agreement. For purposes of this article, gross violations of
Collective Bargaining Agreement shall mean flagrant and/or malicious refusal to
comply with the economic provisions of such agreement.
The Commission, its Regional Offices and the Regional Directors of the Department
of Labor and Employment shall not entertain disputes, grievances or matters under the
exclusive and original jurisdiction of the Voluntary Arbitrator or panel of Voluntary
Arbitrators and shall immediately dispose and refer the same to the Grievance
Machinery or Voluntary Arbitration provided in the Collective Bargaining Agreement.
Art. 262. Jurisdiction over other labor disputes. The Voluntary Arbitrator or
panel of Voluntary Arbitrators, upon agreement of the parties, shall also hear and
decide all other labor disputes including unfair labor practices and bargaining
deadlocks.
In construing the above provisions, we held in San Jose vs. NLRC, that
the jurisdiction of the Labor Arbiter and the Voluntary Arbitrator or Panel of
Voluntary Arbitrators over the cases enumerated in the Labor Code, Articles
217, 261 and 262, can possibly include money claims in one form or another.
[10]
Comparatively, in Reformist Union of R.B. Liner, Inc. vs. NLRC,
[11]
compulsory arbitration has been defined both as the process of settlement
of labor disputes by a government agency which has the authority to
investigate and to make an award which is binding on all the parties, and as a
mode of arbitration where the parties are compelled to accept the resolution of
their dispute through arbitration by a third party (emphasis supplied). [12] While
a voluntary arbitrator is not part of the governmental unit or labor departments
personnel, said arbitrator renders arbitration services provided for under labor
laws.
[9]
determine the scope of his own authority subject only, in a proper case, to the
certiorari jurisdiction of this Court. The Arbitrator, as already indicated, viewed his
authority as embracing not merely the determination of the abstract question of
whether or not a performance bonus was to be granted but also, in the affirmative
case, the amount thereof.
By the same token, the issue of regularization should be viewed as two-tiered
issue. While the submission agreement mentioned only the determination of the date
or regularization, law and jurisprudence give the voluntary arbitrator enough leeway
of authority as well as adequate prerogative to accomplish the reason for which the
law on voluntary arbitration was created speedy labor justice. It bears stressing that
the underlying reason why this case arose is to settle, once and for all, the ultimate
question of whether respondent employees are entitled to higher benefits. To require
them to file another action for payment of such benefits would certainly undermine
labor proceedings and contravene the constitutional mandate providing full protection
to labor.[14]
As regards petitioners contention that the money claim in this case is
barred by prescription, we hold that this contention is without merit. So is
petitioners stance that the benefits claimed by the respondents, i.e., sick
leave, vacation leave and 13th-month pay, had already prescribed, considering
the three-year period for the institution of monetary claims. [15] Such
determination is a question of fact which must be ascertained based on the
evidence, both oral and documentary, presented by the parties before the
Voluntary Arbitrator. In this case, the Voluntary Arbitrator found that
prescription has not as yet set in to bar the respondents claims for the
monetary benefits awarded to them. Basic is the rule that findings of fact of
administrative and quasi-judicial bodies, which have acquired expertise
because their jurisdiction is confined to specific matters, are generally
accorded not only great respect but even finality.[16] Here, the Voluntary
Arbitrator received the evidence of the parties first-hand. No compelling
reason has been shown for us to diverge from the findings of the Voluntary
Arbitrator, especially since the appellate court affirmed his findings, that it took
some time for respondent employees to ventilate their claims because of the
repeated assurances made by the petitioner that it would review the company
records and determine therefrom the validity of the claims, without expressing
a categorical denial of their claims. As elucidated by the Voluntary Arbitrator:
The respondents had raised prescription as defense. The controlling law, as ruled by
the High Court, is:
The cause of action accrues until the party obligated refuses xxx to comply with his
duty. Being warded off by promises, the workers not having decided to assert [their]
right[s], [their] causes of action had not accrued (Citation omitted.)
Since the parties had continued their negotiations even after the matter was raised
before the Grievance Procedure and the voluntary arbitration, the respondents had not
refused to comply with their duty. They just wanted the complainants to present some
proofs. The complainants cause of action had not therefore accrued yet. Besides, in
the earlier voluntary arbitration case aforementioned involving exactly the same issue
and employees similarly situated as the complainants, the same defense was raised
and dismissed by Honorable Thelma Jordan, Voluntary Arbitrator.
In fact, the respondents promised to correct their length of service and grant them the
back CBA benefits if the complainants can prove they are entitled rendered the former
in estoppel, barring them from raising the defense of laches or prescription. To hold
otherwise amounts to rewarding the respondents for their duplicitous representation
and abet them in a dishonest scheme against their workers. [17]
Indeed, as the Court of Appeals concluded, under the equitable principle
of estoppel, it will be the height of injustice if we will brush aside the
employees claims on a mere technicality, especially when it is petitioners
own action that prevented them from interposing the claims within the
prescribed period.
WHEREFORE, the petition is DENIED. The appealed decision of the
Court of Appeals in CA-G.R. SP No. 44341 and the resolution denying
petitioners motion for reconsideration, areAFFIRMED. Costs against
petitioner.
SO ORDERED.
SECOND DIVISION
G.R. No. 138938. October
24, 2000
CELESTINO
VIVIERO, Petitioner,
vs. COURT OF APPEALS,
HAMMONIA
MARINE
SERVICES, and HANSEATIC
SHIPPING
CO.,
LTD. Respondents.
DECISION
BELLOSILLO, J.:
CELESTINO VIVERO, in this
petition for review, seeks the
reversal of the Decision of the
Court of Appeals of 26 May
1999
setting
aside
the
Decision of the National Labor
Relations Commission of 28
May 1998 as well as its
directly
to
the
and
two
LABOR
REPRESENTATIVES
to
be
designated by the UNION.
Sec. 6. Any grievance, dispute
or
misunderstanding
concerning
any
ruling,
practice, wages or working
conditions in the COMPANY, or
any
breach
of
the
Employment Contract, or any
dispute arising from the
meaning or the application of
the
provision
of
this
Agreement or a claim of
violation
thereof
or
any
complaint that any such
crewmembers
may
have
against the COMPANY, as well
as
complaint
which
the
COMPANY may have against
such crewmembers shall be
brought to the attention of the
GRIEVANCE
COMMITTEE
before either party takes any
action, legal or otherwise.
Sec. 7. The COMMITTEE shall
resolve any dispute within
seven (7) days from and after
the same is submitted to it for
resolution and if the same
cannot be settled by the
COMMITTEE
or
if
the
COMMITTEE fails to act on the
dispute within the 7-day
period herein provided, the
same shall be referred to a
VOLUNTARY
COMMITTEE.
ARBITRATION
crlwvirtualibrry
Celestino
Vivero,
in
his
petition for review assailing
the Decision of the Court of
Appeals, alleges that the
appellate court committed
grave abuse of discretion in
holding that a Voluntary
Arbitrator
or
Panel
of
Voluntary Arbitrators, and not
the Adjudication Branch of the
NLRC, has jurisdiction over his
complaint for illegal dismissal.
He claims that his complaint
for
illegal
dismissal
was
undeniably
a
termination
dispute and did not, in any
way, involve an "interpretation
or
implementation
of
collective
bargaining
agreement" or "interpretation"
or "enforcement" of company
personnel policies. Thus, it
should fall within the original
and exclusive jurisdiction of
the NLRC and its Labor
Arbiter, and not with a
Voluntary
Arbitrator,
in
accordance with Art. 217 of
the Labor Code.
Private respondents, on the
other hand, allege that the
case is clearly one "involving
the
(P5,000.00)
regardless
of
whether accompanied with a
claim for reinstatement.
(b) The Commission shall
have
exclusive
appellate
jurisdiction over all cases
decided by Labor Arbiters.
(c) Cases arising from the
interpretation
of
collective
bargaining agreements and
those
arising
from
the
interpretation or enforcement
of company personnel policies
shall be disposed of by the
Labor Arbiter by referring the
same
to
the
grievance
machinery
and
voluntary
arbitration
as
may
be
provided in said agreements
(emphasis supplied).
However, any or all of these
cases may, by agreement of
the parties, be submitted to a
Voluntary Arbitrator or Panel
of Voluntary Arbitrators for
adjudication. Articles 261 and
262 of the Labor Code provide
Art.
261. Jurisdiction
of
Voluntary Arbitrators or Panel
of Voluntary Arbitrators. - The
Voluntary Arbitrator or panel
of Voluntary Arbitrators shall
have original and exclusive
jurisdiction to hear and decide
all
unresolved
grievances
arising from the interpretation
or implementation of the
Collective
Bargaining
Agreement and those arising
from the interpretation or
enforcement
of
company
personnel policies referred to
in the immediately preceding
article. Accordingly, violations
of a Collective Bargaining
Agreement,
except
those
which are gross in character,
shall no longer be treated as
unfair labor practice and shall
be resolved as grievances
under
the
Collective
Bargaining Agreement. For
purposes of this article, gross
violations
of
Collective
Bargaining Agreement shall
mean
flagrant
and/or
malicious refusal to comply
with the economic provisions
of such agreement.
The Commission, its Regional
Offices and the Regional
Directors of the Department of
Labor and Employment shall
not
entertain
disputes,
grievances or matters under
the exclusive and original
jurisdiction of the Voluntary
Arbitrator
or
panel
of
Voluntary Arbitrators and shall
immediately dispose and refer
the same to the Grievance
Machinery
or
Voluntary
Arbitration provided in the
Collective
Bargaining
Agreement.
Art. 262. Jurisdiction Over
Other Labor Disputes. - The
Voluntary Arbitrator or panel
of Voluntary Arbitrators, upon
agreement of the parties,
shall also hear and decide all
other labor disputes including
unfair labor practices and
bargaining
deadlocks
(emphasis supplied).
Private respondents attempt
to justify the conferment of
jurisdiction over the case on
the Voluntary Arbitrator on
the ground that the issue
involves
the
proper
interpretation
and
implementation
of
the
Grievance Procedure found in
the CBA. They point out that
when petitioner sought the
assistance of his Union to
avail
of
the
grievance
machinery,
he
in
effect
submitted himself to the
procedure set forth in the CBA
regarding
submission
of
unresolved grievances to a
Voluntary Arbitrator.
The argument is untenable.
The case is primarily a
termination dispute. It is clear
from
the
claim/assistance
request form submitted by
petitioner to AMOSUP that he
was challenging the legality of
his dismissal for lack of cause
and lack of due process. The
issue of whether there was
proper
interpretation
and
implementation of the CBA
provisions comes into play
only because the grievance
procedure provided for in the
CBA was not observed after
he
sought
his
Unions
assistance in contesting his
termination.
Thus,
the
question
to
be
resolved
necessarily springs from the
primary issue of whether
there was a valid termination;
without this, then there would
be no reason to invoke the
need
to
interpret
and
implement the CBA provisions
properly.
In San
Miguel
Corp.
v.
National
Labor
Relations
21
Commission this Court held
that the phrase "all other
labor disputes" may include
termination disputes provided
that the agreement between
the Union and the Company
states
"in
unequivocal
language that [the parties]
conform to the submission of
termination
disputes
and
unfair
labor
practices
to
22
voluntary arbitration." Ergo,
it is not sufficient to merely
say that parties to the CBA
agree on the principle that "all
disputes" should first be
submitted to a Voluntary
Arbitrator. There is a need for
an express stipulation in the
CBA that illegal termination
disputes should be resolved
by a Voluntary Arbitrator or
Panel of Voluntary Arbitrators,
since the same fall within a
special class of disputes that
are
generally
within
the
exclusive original jurisdiction
of Labor Arbiters by express
provision of law. Absent such
express
stipulation,
the
phrase "all disputes" should
be construed as limited to the
areas of conflict traditionally
within the jurisdiction of
Voluntary
Arbitrators, i.e.,
disputes relating to contractinterpretation,
contractimplementation,
or
interpretation or enforcement
of
company
personnel
policies. Illegal termination
disputes - not falling within
any of these categories should then be considered as
a special area of interest
governed
by
a
specific
provision of law.
voluntary arbitration as a
mode of settling disputes."26 It
should be noted, however,
that in Navarro III all the
parties voluntarily submitted
to the jurisdiction of the
Voluntary
Arbitrator
when
they filed their respective
position papers and submitted
documentary evidence before
him.
Furthermore,
they
manifested during the initial
conference that they were not
questioning the authority of
the Voluntary Arbitrator.27 In
the case at bar, the dispute
was never brought to a
Voluntary
Arbitrator
for
resolution; in fact, petitioner
precisely requested the Court
to recognize the jurisdiction of
the Labor Arbiter over the
case. The Court had held
in San
Miguel
Corp.
v.
28
NLRC that neither officials
nor tribunals can assume
jurisdiction in the absence of
an express legal conferment.
In
the
same
manner,
petitioner cannot arrogate into
the
powers
of
Voluntary
Arbitrators the original and
exclusive jurisdiction of Labor
Arbiters over unfair labor
practices,
termination
disputes,
and
claims
for
damages, in the absence of an
express agreement between
Termination
Cases
and
Providing Guidelines for the
Referral
of
Said
Cases
Originally Filed with the NLRC
to the NCMB," termination
cases arising in or resulting
from the interpretation and
implementation of collective
bargaining agreements and
interpretation
and
enforcement
of
company
personnel policies which were
initially processed at the
various steps of the plantlevel Grievance Procedures
under the parties' collective
bargaining agreements fall
within
the
original
and
exclusive jurisdiction of the
voluntary arbitrator pursuant
to Art. 217 (c) and Art. 261 of
the Labor Code; and, if filed
before the Labor Arbiter, these
cases shall be dismissed by
the Labor Arbiter for lack of
jurisdiction and referred to the
concerned
NCMB
Regional
Branch for appropriate action
towards
an
expeditious
selection by the parties of a
Voluntary Arbitrator or Panel
of Arbitrators based on the
procedures agreed upon in the
CBA.
As earlier stated, the instant
case is a termination dispute
falling under the original and
petitioner,
should
have
informed him of his option to
settle
the
case
through
voluntary arbitration. Private
respondents, on their part,
should have timely invoked
the provision of their CBA
requiring the referral of their
unresolved disputes to a
Voluntary Arbitrator once it
became apparent that the
grievance machinery failed to
resolve it prior to the filing of
the case before the proper
tribunal.
The
private
respondents should not have
waited for nine (9) months
from the filing of their Position
Paper with the POEA before it
moved to dismiss the case
purportedly
for
lack
of
jurisdiction. As it is, private
respondents are deemed to
have waived their right to
question
the
procedure
followed
by
petitioner,
assuming that they have the
right to do so. Under their
CBA,
both
Union
and
respondent companies are
responsible for selecting an
impartial arbitrator or for
convening
an
arbitration
30
committee; yet,
it
is
apparent that neither made a
move
towards
this
end.
Consequently,
petitioner
should not be deprived of his
made by the respondents in paying their termination benefits . . ." Clearly, there was impermissible
discrimination against the private respondents in the payment of their separation benefits. The law
requires an employer to extend equal treatment to its employees. It may not, in the guise of
exercising management prerogatives, grant greater benefits to some and less to others.
Management prerogatives are not absolute prerogatives but are subject to legal limits, collective
bargaining agreements, or general principles of fair play and justice (UST vs. NLRC, 190 SCRA
758). Article 283 of the Labor Code, as amended, protects workers whose employment is terminated
because of closure of the establishment or reduction of personnel (Abella vs. NLRC, 152 SCRA 141,
145).
2. ID.; ID.; CORPORATE OFFICER NOT PERSONALLY LIABLE FOR MONEY CLAIMS OF
DISCHARGED CORPORATE EMPLOYEES; EXCEPTION. A corporate officer is not personally
liable for the money claims of discharged corporate employees unless he acted with evident malice
and bad faith in terminating their employment. There is no evidence in this case that Locsin acted in
bad faith or with malice in carrying out the retrenchment and eventual closure of the company
(Garcia vs. NLRC, 153 SCRA 640), hence, he may not be held personally and solidarily liable with
the company for the satisfaction of the judgment in favor of the retrenched employees.
3. ID.; GRANT OF BONUS; A PREROGATIVE, NOT AN OBLIGATION, OF EMPLOYER; ENTIRELY
DEPENDENT ON FINANCIAL CAPABILITY OF EMPLOYER TO GIVE IT. It is settled do trine that
the grant of a bonus is a prerogative, not an obligation, of the employer (Traders Royal Bank vs.
NLRC, 189 SCRA 274). The matter of giving a bonus over and above the worker's lawful salaries
and allowances is entirely dependent on the financial capability of the employer to give it. The fact
that the company's business was no longer profitable (it was in fact moribund) plus the fact that the
private respondents did not work up to the middle of the year (they were discharge in May 1988)
were valid reasons for not granting them a mid-year bonus. Requiring the company to pay a midyear bonus to them also would in effect penalize the company for its generosity to those workers
who remained with the company "till the end" of its days. (Traders Royal Bank vs. NLRC, supra.)
The award must therefore be deleted.
DECISION
GRIO-AQUINO, J p:
In this petition for certiorari, the Businessday Information Systems and Services Inc. (or BSSI for
brevity) and its president/manager, Raul Locsin, seek to annul and set aside the decision dated
February 13, 1991 of the National Labor Relations Commission (NLRC) which affirmed the Labor
Arbiter's finding that they (petitioners) are liable to pay the private respondents separation pay
differentials and mid-year bonus.
BSSI was engaged in the manufacture and sale of computer forms. Due to financial reverses, its
creditors, the Development Bank of the Philippines (DBP) and the Asset Privatization Trust (APT),
took possession of its assets, including a manufacturing plant in Marilao, Bulacan.
As a retrenchment measure, some plant employees, including the private respondents, were laid off
on May 16, 1988, after prior notice, and were paid separation pay equivalent to one-half (1/2) month
pay for every year of service. Upon receipt of their separation pay, the private respondents signed
individual releases and quitclaims in favor of BSSI.
BSSI retained some employees in an attempt to rehabilitate its business as a TRADING COMPANY
.
However, barely two and a half months later, these remaining employees were likewise discharged
because the company decided to cease business operations altogether. Unlike the private
respondents, that batch of employees received separation pay equivalent to a full month's salary for
every year of service plus mid-year bonus.
Protesting against the discrimination in the payment of their separation benefits, the twenty-seven
(27) private respondents filed three (3) separate complaints against the BSSI and Raul Locsin.
These cases were later consolidated.
At the conciliation proceedings before Labor Arbiter Manuel P. Asuncion, petitioners denied that
there was unlawful discrimination in the payment of separation benefits to the employees. They
argued that the first batch of employees was paid "retrenchment" benefits mandated by law, while
the remaining employees were granted higher "separation" benefits because their termination was
on account of the closure of the business.
Based on the pleadings of the parties, Labor Arbiter Asuncion rendered a decision on April 25, 1989
in favor of the complainants, now private respondents, the dispositive portion of which reads:
"WHEREFORE, the respondents are hereby ordered to pay the complainants their separation pay
differentials and mid-year bonus for the year 1988." (p- 38, Rollo).
Upon appeal by the company to the NLRC, the Second Division on February 13, 1991, affirmed the
decision of the Labor Arbiter.
Petitioners' motion for reconsideration of the resolution having been denied, they have taken the
present recourse.
In case of retrenchment of a company to prevent losses and closure of business operation, the law
provides:
Art. 283. Closure of establishment and reduction of personnel. The employer may also terminate
the employment of any employee due to the installation of labor saving devices, redundancy,
retrenchment to prevent losses or the closing or cessation of operations of the establishment or
undertaking unless the closing is for the purpose of circumventing the provisions of this Title, by
serving a written notice on the workers and the Ministry of Labor and Employment at least one (1)
month before the intended date thereof. In case of termination due to the installation of labor saving
devices or redundancy, the worker affected thereby shall be entitled to a separation pay equivalent
to at least his one (1) month pay or to at least one (1) month pay for every year of service, whichever
is higher. In case of retrenchment to prevent losses and in cases of closures or cessation of
operations of establishment or undertaking not due to serious business losses or financial reverses,
the separation pay shall be equivalent to one (1) month pay or at least one half (l /2) month pay for
every year of service, whichever is higher. A fraction of at least six (6) months shall be considered
one (1) whole year." (Labor Code; emphasis supplied.)
Undoubtedly, petitioners' right to terminate employees on account of retrenchment to prevent losses
or closure of business operations, is recognized by law, but it may not pay separation benefits
unequally for such discrimination breeds resentment and ill-will among those who have been treated
less generously than others.
The following observations of the Commission are relevant:
"The respondents cited financial business difficulties to justify their termination of the complainants'
employment on 16 May 1988. They were given one-half (1/2) month of their salary for every year of
service. Due to continuing losses, which is a sign that business, after the termination did not
improve, they closed operations on 31 July 1989, where they dismissed the second batch of
employees who were given one (1) month pay for every year they served. The third batch of
employees were terminated on 28 February 1989, who were likewise given one (1) monthly pay for
every year of service. The business climate obtaining on 16 May 1988 when the complainants were
terminated did not at all defer (sic) improvement-wise, with that of 31 July 1988 nor to 28 February
1989. The internal between the dates of termination was so close to each other, so that, no
improvement in business maybe likely expected. In fact, the respondents suffered continuous
losses, hence, there is no difference in the circumstances of the business to distinguish.
"Granting that the 16 May 1988 termination was a retrenchment scheme, and the 31 July 1988 and
the 28 February 1989 were due to closure, the law requires the granting of the same amount of
separation benefits to the affected employees in any of the cases. The respondent argued that the
giving of more separation benefit to the second and third batches of employees separated was their
expression of gratitude and benevolence to the remaining employees who have tried to save and
make the company viable in the remaining days of operations. This justification is not plausible.
There are workers in the first batch who have rendered more years of service and could even be
said to be more efficient than those separated subsequently, yet they did not receive the same
recognition. Understandably, their being retained longer in their job and be not included in the batch
that was first terminated, was a concession enough and may already be considered as favor granted
by the respondents to the prejudice of the complainants. As it happened, there are workers in the
first batch who have rendered more years in service but received lesser separation pay, because of
that arrangement made by the respondents in paying their termination benefits . . ."
(pp. 36-37, Rollo)
Clearly, there was impermissible discrimination against the private respondents in the payment of
their separation benefits. The law requires an employer to extend equal treatment to its employees.
It may not, in the guise of exercising management prerogatives, grant greater benefits to some and
less to others. Management prerogatives are not absolute prerogatives but are subject to legal limits,
collective bargaining agreements, or general principles of fair play and justice (UST vs. NLRC, 190
SCRA 758). Article 283 of the Labor Code, as amended, protects workers whose employment is
terminated because of closure of the establishment or reduction of personnel (Abella vs. NLRC, 152
SCRA 141, 145).
With regard to the private respondents' claim for the mid-year bonus, it is settled doctrine that the
grant of a bonus is a prerogative, not an obligation, of the employer (Traders Royal Bank vs. NLRC,
189 SCRA 274). The matter of giving a bonus over and above the worker's lawful salaries and
allowances is entirely dependent on the financial capability of the employer to give it. The fact that
the company's business was no longer profitable (it was in fact moribund) plus the fact that the
private respondents did not work up to the middle of the year (they were discharged in May 1988)
were valid reasons for not granting them a mid-year bonus. Requiring the company to pay a midyear bonus to them also would in effect penalize the company for its generosity to those workers
who remained with the company till the end" of its days. (Traders Royal Bank vs. NLRC, supra.) The
award must therefore be deleted.
There is merit in the contention of petitioner Raul Locsin that the complaint against him should be
dismissed. A corporate officer is not personally liable for the money claims of discharged corporate
employees unless he acted with evident malice and bad faith in terminating their employment. There
is no evidence in this case that Locsin acted in bad faith or with malice in carrying out the
retrenchment and eventual closure of the company (Garcia vs. NLRC, 153 SCRA 640), hence, he
may not be held personally and solidarily liable with the company for the satisfaction of the judgment
in favor of the retrenched employees.
WHEREFORE, the resolution of the NLRC ordering the petitioner company to pay separation pay
differentials to the private respondents is AFFIRMED. However, the award of mid-year bonus to them
is hereby deleted and set aside. Petitioner Raul Locsin is absolved from any personal liability to the
respondent employees. No costs.
SO ORDERED.
This Court affirmed that Decision when it denied the Petition for Review filed by RANSOM on
February 26, 1973 in G.R. Nos. L-36226-68.
The backwages due the 22 employees having been computed at P 199,276.00 by the (CIR)
Examiner, successive Motions for Execution were filed by the UNION on January 27, 1973 and
March 1, 1973, all of which RANSOM opposed stressing its "precarious financial position if
immediate execution of the backwages would be ordered." Upon the UNION's Motion of April 22,
1973 asking the CIR that RANSOM be ordered to deposit with the Court the backwages due them.
RANSOM manifested that it did not have the necessary funds to deposit and asked that the
employees' earnings elsewhere during this suspension be deducted. After several hearings, a
recomputation was made and the award of P199,276.00 was reduced to P 164,984.00. 2
The records show that, upon application filed by RANSOM on April 2, 1973, it was granted clearance
by the Secretary of Labor on June 7, 1973 to cease operation and terminate employment effective
May 1, 1973, without prejudice to the right of subject employees to seek redress of grievances under
existing laws and decrees. 3 The reasons given by RANSOM for the clearance application
were financial difficulties on account of obligations incurred prior to 1966.
On January 21, 1974, the UNION filed another Motion for Execution alleging that although RANSOM
had assumed a posture of suffering from business reverse, its officers and principal stockholders
had organized a new corporation, the Rosario Industrial Corporation (thereinafter called ROSARIO),
using the same equipment, personnel, business stocks and the same place of business. For its part,
RANSOM declared that ROSARIO is a distinct and separate corporation, which was organized long
before these instant cases were decided adversely against RANSOM.
It appears that sometime in 1969, ROSARIO, a closed corporation, was, in fact, established. It was
engaged in the same line of business as RANSOM with the same Hernandez family as the owners,
the same officers, the same President, the same counsel and the same address at 555 Quirino
Avenue, Paranaque, Rizal. The compound, building, plant, equipment, machinery, laboratory and
bodega were the same as those occupied and used by RANSOM. The UNION claims that
ROSARIO thrives to this day.
Writs of execution were issued successively against RANSOM on June 23, 1976, and February 17,
1977, to no avail.
On December 18, 1978, the UNION again filed an ex-parte Motion for Writ of Execution and
Garnishment praying that the Writ issue against the Officers/Agents of RANSOM personally and or
their estates, as the case may be, considering their success in hiding or shielding the assets of said
company. RANSOM countered that the CIR Decision, dated August 19, 1972, could no longer be
enforced by mere Motion because more than five (5) years had already lapsed.
Acting on the Motion, Labor Arbiter Tito F. Genilo issued, on March 11, 1980, an Order, the pertinent
part of which reads:
Under the circumstances and pursuant to the decision aforementioned, especially
that portion holding the respondent corporation's officers and agents liable, the
On June 10, 1986, this Court promulgated its Decision, the dispositive portion of which decrees:
WHEREFORE, the questioned Decision of the National Labor Relations
Commission is SET ASIDE, and the Order of the Labor Arbiter Tito F. Genilo of
March 11, 1980 is reinstated with the modification that personal liability for the
backwages due the 22 strikers shall be limited to Ruben Hernandez, who was
President of RANSOM in 1974, jointly and severally with other Presidents of the
same corporation who had been elected as such after 1972 or up to the time the
corporate life was terminated.
Both parties have moved for reconsideration. Private respondents point out that they were never
impleaded as parties in the Trial Court, and that their personal liabilities were never at issue; that
judgment holding Ruben Hernandez personally liable is tantamount to deprivation of property without
due process of law; and that he was not an officer of the corporation at the time the unfair labor
practices were committed.
The UNION on the other hand, in its own Motion for Reconsideration, prays that the veil of corporate
fiction be pierced and that the Decision be modified, in that all the individual private respondents and
not only the President, should be held jointly and severally liable with RANSOM. On November 4,
1986, it further filed an Urgent Motion for Preliminary Mandatory Injunction "directing private
respondents to deposit the amount of P 199,276.00 or to put up a supersedeas bond of the same
sum."
Incontrovertible is the fact that RANSOM was found guilty by the CIR, in its Decision of August 19,
1972, of unfair labor practice; that its officers and agents were ordered to cease and desist from
further committing acts constitutive of the same, and to reinstate immediately the 22 union members
to their respective positions with backwages from July 25, 1969 until actually reinstated.
The CIR Decision became final, conclusive, and executory after this Court denied the RANSOM
petition for review in 1973. In other words, this Court upheld that portion of the judgment ordering
the officers and agents of RANSOM to reinstate the laborers concerned, with backwages. The
inclusion of the officers and agents was but proper since a corporation, as an artificial being, can act
only through them. It was also pursuant to the CIR Act (CA No. 103 ), 7 the Industrial Peace Act (R.A.
875) 8 the Minimum Wage Law (R.A. 602). 9 Consequently, when, in resolving the UNION's Motion for Writ
of Execution and Garnishment in the Order of March 11, 1980, Labor Arbiter Genilo named the seven (17)
private respondents herein as the RANSOM officers and agents, who should be held liable (supra), he
merely implemented the already final and executory CIR decision of August 19, 1972. The NLRC, on
appeal to it by RANSOM, could not have modified the CIR Decision, as affirmed by this Court, by relieving
RANSOM's officers and agents of liability. It is also for that reason that in our Decision of June 10, 1986
we set aside said NLRC Decision and reinstated the Order of Labor Arbiter Genilo, with modification, in
that we limited liability for backwages due the 22 UNION members to the President of RANSOM in 1974
jointly and severally with other Presidents of the same corporation who had been elected as such after
1972 or up to the time the corporation life was terminated, since the President should also be deemed
included in the term "employer. "
The foregoing, however, limits the scope of liability and deviates from the CIR Decision, affirmed by
this Court in 1973, holding the officers and agents of RANSOM liable. In other words, the officers
and agents listed in the Genilo Order except for those who have since passed away, should, as
affirmed by this Court, be held jointly and severally liable for the payment of backwages to the 22
strikers.
This finding does not ignore the legal fiction that a corporation has a personality separate and
distinct from its stockholders and members, for, as this Court had held "where the incorporators and
directors belong to a single family, the corporation and its members can be considered as one in
order to avoid its being used as an instrument to commit injustice," 10 or to further an end subversive of
justice. 11 In the case of Claparols vs. CIR 12 involving almost similar facts as in this case, it was also held that the shield of corporate fiction
should be pierced when it is deliberately and maliciously designed to evade financial obligations to employees. To the same effect was this
Court's rulings in still other cases:
When the notion of legal entity is used as a means to perpetrate fraud or an illegal
act or as a vehicle for the evasion of an existing obligation, the circumvention of
statutes, and or confuse legitimate issues the veil which protects the corporation will
be lifted (Villa Rey Transit, Inc. vs. Ferrer, 25 SCRA 846 [1968]; Republic vs. Razon,
20 SCRA 234 [1967]; A.D. Santos, Inc. vs. Vasquez, 22 SCRA 1156 [1968];
Telephone Eng'g. & Service Company, Inc. vs. WCC, 104 SCRA 354 [1981]).
The alleged bankruptcy of RANSOM furnishes no justification for non-payment of backwages to the
employees concerned taking into consideration Article 110 of the Labor Code, which provides:
ART. 110. Worker preference in case of bankruptcy. - In the event of bankruptcy or
liquidation of an employer's business, his workers shall enjoy first preference as
regards wages due them for services rendered during the period prior to the
bankruptcy or liquidation, any provision of law to the contrary notwithstanding.
Unpaid wages shag be paid in full before other creditors may establish any claim to a
share in the assets of the employer.
The term "wages" refers to all remunerations, earnings and other benefits in terms of money
accruing to the employees or workers for services rendered. They are to be paid in full before other
creditors may establish any claim to a share in the assets of the employer.
Section 10. Payment of wages in case of bankruptcy.-Unpaid wages earned by the
employees before the declaration of bankruptcy or judicial liquidation of the
employer's business shall be given first preference and shall be paid in full before
other creditors may establish any claim to a share in the assets of the employer. 13
The foregoing provisions are but in consonance with the principles of social justice and protection to
labor guaranteed by past and present Constitutions and are not really being given any retroactive
effect when applied herein.
The Decision of the CIR was rendered on August 19, 1972. Clearance to RANSOM to cease
operations and terminate employment granted by the Secretary of Labor was made effective on May
1, 1973. The right of the employees concerned to backwages awarded them, therefore, had already
vested at the time and even before clearance was granted. Note should also be taken of the fact that
the clearance was without prejudice to the right of subject employees to seek redress of grievances
under existing laws and decrees.
The worker preference applies even if the employer's properties are encumbered by means of a
mortgage contract, as in this case. So that, when machinery and equipment of RANSOM were sold
to Revelations Manufacturing Corporation for P 2M in 1975, the right of the 22 laborers to be paid
from the proceeds should have been recognized, even though it is claimed that those proceeds were
turned over to the Commercial Bank and Trust Company (Comtrust) in payment of RANSOM
obligations, since the workers' preference is over and above the claim of other creditors.
The contention, therefore, of the heirs of the late Maximo C. Hernandez, Sr. that since they paid from
their own personal funds the balance of the amount owing by RANSOM to Comtrust they are the
"preferential creditors" of RANSOM, is clearly without merit. Workers are to be paid in full before
other creditors may establish any claim to a share in the assets of the employer.
... even if the employer's properties are encumbered by means of a mortgage
contract, still the workers' wages which enjoy first preference in case of bankruptcy
or liquidation are duly protected by an automatic first lien over and above all other
earlier encumbrances on the said properties. Otherwise, workers' wages may be
imperilled by foreclosure of mortgages, and as a consequence, the aforecited
provision of the New Labor Code would be rendered meaningless. 14
Aggravating RANSOM's clear evasion of payment of its financial obligations is the organization of a
"run-away corporation," ROSARIO, in 1969 at the time the unfair labor practice case was pending
before the CIR by the same persons who were the officers and stockholders of RANSOM, engaged
in the same line of business as RANSOM, producing the same line of products, occupying the same
compound, using the same machineries, buildings, laboratory, bodega and sales and accounts
departments used by RANSOM, and which is still in existence. Both corporations were closed
corporations owned and managed by members of the same family. Its organization proved to be a
convenient instrument to avoid payment of backwages and the reinstatement of the 22 workers. This
is another instance where the fiction of separate and distinct corporate entities should be
disregarded.
It is very obvious that the second corporation seeks the protective shield of a
corporate fiction whose veil in the present case could, and should, be pierced as it
was deliberately and maliciously designed to evade its financial obligation to its
employees.
... When a notion of legal entity is used to. defeat public convenience, justify wrong,
protect fraud, or defend crime, the law will regard the corporation as an association
or persons, or, in the case of two corporations, will merge them into one. 15
The corporation will be treated merely as an aggregation of individuals or, where there are two corporations, they will
be merged as one, the one being merely regarded as part of the instrumentality of the other. 16
The UNION's plea, therefore, for the reinstatement of the 22 strikers in ROSARIO should be
favorably heard. However, ROSARIO shall have the option to award them separation pay equivalent
to one-half month for every year of service actually rendered by the 22 strikers.
The plea of the UNION for the restoration of the original computation of P199,276.00 or to grant the
22 Union members three (3) years backwages is rejected. It is the amount of P164,984.00 as
backwages, which was the subject of the Writ of Execution issued by the Labor Arbiter pursuant to
the CIR Decision of 1972.
With the conclusions arrived at, the UNION's Urgent Motion for a Writ of Preliminary Mandatory
Injunction directing private respondents to deposit the amount due as backwages in the meantime,
need no longer be acted on.
A final and executory Decision in favor of the UNION obtained in 1972 and affirmed by this Court in
1973 has remained unsatisfied to this date despite no less than ten (10) Motions for Execution over
a period of fourteen (14) years, not to mention the fact that this is the second time that this case is
before this Court. The detriment and prejudice caused the employees concerned is subversive of the
ends of justice. This protracted litigation must end and labor should now enjoy the just deserts of its
legal victory.
ACCORDINGLY, private respondents' Motion for Reconsideration is hereby denied with FINALITY;
the Motion for Reconsideration filed by petitioner is granted in part; and the dispositive portion of the
Decision, dated June 10, 1986, is hereby amended to read as follows:
WHEREFORE, the questioned Decision of the National Labor
Relations Commission is SET ASIDE, and the Order of Labor Arbiter Tito F. Genilo
of March 11, 1980 is reinstated with the modification that Rosario Industrial
Corporation and its officers and agents are hereby held jointly and severally liable
with the surviving private respondents for the payment of the backwages due the 22
union members.
Rosario Industrial Corporation is hereby ordered to reinstate the 22 union members
or, if this is not possible, to award them separation pay equivalent at least to one (1)
month pay or to one (1) month salary for every year of service actually rendered by
them with A.C. Ransom (Phils). Corporation, whichever is higher.
This decision is immediately executory.
SO ORDERED.
On June 26, 1987, petitioner in order to commence its operation, signed a tri-partite agreement so
the workers may lift their strike, by and among petitioner, respondents NUWHRAIN and Mabuhay
whereby the latter paid to respondent NUWHRAIN the sum of P 638,000.00 in addition to the first
payment in the sum of P 386,447.11, for which reason respondent NUWHRAIN agreed to lift the
picket . 3
Respondent NUWHRAIN on July 13, 1987 filed its position paper alleging connivance between
Mabuhay and petitioner in selling the assets and closing the HOTEL to escape its obligations to the
employees of Mabuhay and so it prays that petitioner accept the workforce of Mabuhay and pay
backwages from April 15,1986 to April 28,1987, the day Mabuhay stopped operation.
On the other hand, petitioner filed a "Partial Motion for Reconsideration and Position Paper," alleging
that it was denied due process; that there were serious errors in the findings of fact which would
cause grave and irreparable damage to its interest; as well as on questions of law. On January 20,
1988, the public respondent issued an order requiring petitioner to absorb the members of the union
and to pay backwages from the time it started operations up to the date of the order. 4
Petitioner filed on January 27,1988 a motion for reconsideration of the aforesaid order alleging that
the theory of implied acceptance and assumption of statutory wrong does not apply in the instant
case; that the prevailing doctrine that there is no law requiring bona fide purchasers of the assets of
an on-going concern to absorb in its employ the employees of the latter should be applied in this
case; that the order for absorption of the employees of Mabuhay as well as the payment of their
backwages is contrary to law. Respondent NUWHRAIN also filed a motion for clarification of the
aforesaid order.
On March 8, 1988, the public respondent denied said motion for reconsideration and motion for
clarification for lack of merit.
Hence, this petition for review by certiorari with prayer for preliminary injunction and/or temporary
restraining order filed by petitioner in this Court. Petitioner presents seven issues for resolution
which all revolve about the singular issue of whether or not under the circumstances of this case the
petitioner may be compelled to absorb the employees of respondent Mabuhay.
On March 23, 1988, this Court, without giving due course to the petition, required respondents to
comment thereon within ten (10) days from notice and issued a temporary restraining order enjoining
public respondent or his duly authorized representatives from executing and implementing the
orders dated January 20, 1988 and March 8, 1988.
The petition is impressed with merit.
The rule is that unless expressly assumed, labor contracts such as employment contracts and
collective bargaining agreements are not enforceable against a transferee of an enterprise, labor
contracts being in personam, thus binding only between the parties .5 A labor contract merely
creates an action in personally and does not create any real right which should be respected by third
parties. This conclusion draws its force from the right of an employer to select his employees and to
decide when to engage them as protected under our Constitution, and the same can only be
restricted by law through the exercise of the police power. 6
As a general rule, there is no law requiring a bona fide purchaser of assets of an on-going concern
to absorb in its employ the employees of the latter. 7
However, although the purchaser of the assets or enterprise is not legally bound to absorb in its
employ the employers of the seller of such assets or enterprise, the parties are liable to the
employees if the transaction between the parties is colored or clothed with bad faith. 8
In the case at bar, contrary to the claim of the public respondent that the transaction between
petitioner and Mabuhay was attended with bad faith, the court finds no cogent basis for such
contention. Thus, the absorption of the employees of Mabuhay may not be imposed on petitioner.
It is undisputed that when Mabuhay surrendered the leased premises to Syjuco and asked Syjuco to
offer same to other lessees it was Syjuco who found petitioner and persuaded petitioner to LEASE
said premises. Mabuhay had nothing to do with the negotiation and consummation of the lease
contract between petitioner and Syjuco.
It was only when Mabuhay offered to sell its assets and personal properties in the premises to
petitioner that they came to deal with each other. It appears that petitioner agreed to purchase said
assets of respondent Mabuhay to enable Mabuhay to pay its obligations to its striking employees
and to Syjuco. Indeed, in the deed of assignment that was executed by Mabuhay in favor of
petitioner on April 14, 1 987 for and in consideration of P2,500,000.00, it is specifically provided
therein that the same is "purely for and in consideration of the sale/transfer and assignment of the
personal properties and assets of HOTEL Mabuhay, Inc. listed . . . " and "in no way involves any
assumption or undertaking on the part of Second Party (petitioner) of any DEBTS or liabilities
whatsoever of Hotel Mabuhay, Inc." 9 The liabilities alluded to in this agreement should be interpreted to
mean not only any monetary liability of Mabuhay but any other liability or obligation arising from the
operation of its business including its liability to its employees.
Moreover, in the tripartite agreement that was entered into by petitioner with respondents
NUWHRAIN and Mabuhay, it is clearly stipulated as follows:
8. That, immediately after the execution of this Agreement, the FIRST PARTY shall
give a list of its members to the THIRD PARTY that it desires to recommend for
employment so that the latter can consider them for employment, with no
commitment whatsoever on the part of the THIRD PARTY to hire them in the
business that it will operate in the premises formerly occupied by the Hotel
Mabuhay;10
From the foregoing, it is clear that petitioner has no liability whatsoever to the employees of
Mabuhay And its responsibility if at all, is only to consider them for re-employment in the operation of
the business in the same premises. There can be no implied acceptance of the employees of
Mabuhay by petitioner and acceptance of statutory wrong as it is expressly provided in the
agreement that petitioner has no commitment or duty to absorb them.
Moreover, the court does not subscribe to the theory of public respondent that petitioner should have
informed NUWHRAIN of its LEASE of the premises and its purchase of the assets and personal
properties of Mabuhay therein so that said employees could have taken steps to protect their
interest. The court finds no such duty on the part of petitioner and its failure to notify said employees
cannot be an indicium of bad faith.
Much less is there any evidence that petitioner and respondent Mabuhay are joint tortfeasors as
found by public respondent. While it is true that petitioner is using the LEASED property for the
same type of business as that of respondent Mabuhay, there can be no continuity of the business
operations of the predecessor employer by the successor employer as respondent Mabuhay had not
retained control of the business. Petitioner is a corporation entirely different from Mabuhay. It has no
controlling interest whatever in respondent Mabuhay. Petitioner and Mabuhay have no privity and
are strangers to each other.
What is obvious is that the petitioner, by purchasing the assets of respondent Mabuhay in
the HOTEL premises, enabled Mabuhay to pay its obligations to its employees. There being no
employer-employee relationship between the petitioner and the Mabuhay employees, the petition
must fail. Petitioner can not be compelled to absorb the employees of Mabuhay and to pay them
backwages.
WHEREFORE, the petition is GRANTED and the questioned orders of public respondent Secretary
of Labor and Employment dated January 20, 1988 and March 8, 1988 are reversed and set aside.
The restraining order that this Court issued on March 20,1988 is hereby made permanent. No
pronouncement as to costs.
SO ORDERED.
Due to the late receipt of its permit to operate at the Port of Davao from the Bureau of Customs,
Davao Dockhandlers, Inc., which was subsequently renamed Filport, actually started its operation on
February 16, 1977.
As a result of the merger, Section 118, Article X of the General Guidelines on The Integration of
Stevedoring/Arrastre Services (PPA Administrative Order No. 13-77) mandated Filport to draw its
personnel complements from the merging operators, as follows:
Sec. 118. Absorption of labor.Subject to the provisions of the immediate preceding
section, and consistent with the actual operational requirements of the new
management, all labor force together with its necessary personnel complement, of
the merging operators shall be absorbed by the merged or integrated organization to
constitute its labor force. (Emphasis supplied)
Thus, Filport's labor force was mostly taken from the integrating corporations, among them the
private respondents.
On February 4,1987, private respondent Paterno Liboon and 18 others filed a complaint with
the Department of Labor and Employment Regional Office in Davao City, alleging that they were
employees of Filport since 1955 through 1958 up to December 31, 1986 when they retired; that they
were paid RETIREMENT BENEFITS computed from February 16,1977 up to December 31, 1986
only; and that taking into consideration their continuous length of service, they are entitled to be
paid RETIREMENT BENEFITS differentials from the time they started working with the
predecessors of Filport up to the time they were absorbed by the latter in 1977 (p. 15, Rollo).
Finding Filport a mere alter ego of the different integrating corporations, the Labor Arbiter held Filport
liable for retirement benefits due private respondents for services rendered prior to February 16,
1977. Said decision was affirmed by the NLRC on appeal.
Filport filed a petition for certiorari with the Supreme Court docketed as G.R. No. 85704, claiming
that it is an entirely new corporation with a separate juridical personality from the integrating
corporations; and that Filport is not a successor-employer, liable for the obligations of private
respondents' previous employers, as shown clearly in the memorandum dated November 21,1978 of
PPA Assistant General Manager Maximo S. Dumlao, Jr., to wit:
21 November 19
MEMORANDUM
TO: The Officer-in-Charge
PMU Davao
FROM: The AGM for Operations
SUBJECT: Clarification of Sec. 116 of PPA Administrative
Per entry of judgment, said resolution became final and executory on December 4, 1 990 (p. 108,
Rollo).
Hence, the instant petition for clarification with prayer for preliminary injunction to enjoin the
respondents from enforcing the decision in G.R. No. 85704 until further orders of this Court.
We see no reason to disturb the findings of fact of the public respondent, supported as they are by
substantial evidence in the light of the well established principle that findings of administrative
agencies which have acquired expertise because their jurisdiction is confined to specific matters are
generally accorded not only respect but at times even finality, and that judicial review by this Court
on labor cases does not go so far as to evaluate the sufficiency of the evidence upon which the
Labor Arbiter and the NLRC based their determinations but are limited to issues of jurisdiction or
grave abuse of discretion. (National Federation of Labor Union v. Ople, 143 SCRA 129).
In the case filed by private respondent Paterno Liboon et al against Filport, the findings of the NLRC
in its November 27, 1987 decision are categorical:
In resolving the issues, the Labor Arbiter concludes as follows:
The eventual incorporation of the arrastre/stevedoring firms and their subsequent
registration with the Securities and Exchange Commission on July 13, 1975 brought
to the fore the interlocking ownership of the new corporation.
xxx xxx xxx
Subsequent amendment of its Articles of Incorporation highlighted by the renaming of
the Davao Dockhandlers, Inc. to Filipinas Port Services, Inc. did not diminish the fact
that the ownership and constituency of the new corporation are basically Identical
with the previous owners.
It is, therefore, the considered view of this Office that respondent Filport being a
mere alter ego of the different merging companies has at the very least, the
obligation not only to absorb into its employ workers of the dissolved companies, but
also to absorb the length of service earned by the absorbed employees from their
former employers.
xxx xxx xxx
We are in full accord with, and hereby sustain, the findings and conclusions of the
Labor Arbiter. Under the circumstances, respondent-appellant is a successoremployer. As a successor entity, it is answerable to the lawful obligations of the
predecessor employers, herein integrees. This Commission has so held under the
principle of 'substitution' that the successor firm is liable to (sic) the obligations of the
predecessor employer, notwithstanding the change in management or even
personality, of the new CONTRACTING EMPLOYER ." (Lakas Ng Manggagawang
Filipino (LAKAS] v. Tarlac Electrical Cooperative, Inc. et al., NLRC Case No. RB III-1
57-75, January 28,1978, En Banc). ... The Supreme Court earlier upheld the
"Substitutionary" doctrine in the case of Benguet Consolidated, Inc. vs. BOI
Employees & Workers Union, (G.R. L-24711, April 30, 1968, 23 SCRA 465). (pp. 35
& 37, Rollo)
Said findings were reiterated in the case filed by Josefino Silva against Filport where the NLRC, in its
decision dated January 19, 1988, further ruled that:
... As We have ruled in the similar case involving herein appellant, the latter is
deemed a survivor entity because it continued in an essentially unchanged manner
the business operators of the predecessor arrastre and port service operators, hiring
substantially the same workers, including herein appellee, of the integree
predecessors, using substantially the same facilities, with similar working conditions
and line of business, and employing the same corporate control, although under a
new management and corporate personality. (G.R. No. 86026, p. 35, Rollo)
Thus, granting that Filport had no contract whatsoever with the private respondents regarding the
services rendered by them prior to February 16, 1977, by the fact of the merger, a succession of
employment rights and obligations had occurred between Filport and the private respondents. The
law enforced at the time of the merger was Section 3 of Act No. 2772 which took effect on March 6,
1918. Said law provides:
Sec. 3. Upon the perfecting, as aforesaid, of a consolidation made in the manner
herein provided, the several CORPORATIONS PARTIES thereto shall be deemed
and taken as one corporation, upon the terms and conditions set forth in said
agreement; or, upon the perfecting of a merger, the corporation merged shall be
deemed and taken as absorbed by the other corporation and incorporated in it; and
all and singular rights, privileges, and franchises of each of said corporations, and all
property, real and personal, and all debts due on whatever account, belonging to
each of such corporations, shall be taken and deemed as transferred to and vested
in the new corporation formed by the consolidation, or in the surviving corporation in
case of merger, without further act or deed; and the title to real estate, either by deed
or otherwise, under the laws of the Philippine Islands vested in either corporation,
shall not be deemed in any way impaired by reason of this Act: Provided, however,
That the rights of creditors and all liens upon the property of either of said
corporations shall be preserved unimpaired; and all debts liabilities, and duties of
said corporations shall thenceforth attach to the new corporation in case of a
consolidation, or to the surviving corporation in case of a merger, and be enforced
against said new corporation or surviving corporation as if said debts, liabilities, and
duties had been incurred or contracted by it.
As earlier stated, it was mandated that Filport shall absorb all labor force and necessary personnel
complement of the merging operators, thus, clearly indicating the intention to continue the employeremployee relationships of the individual companies with its employees through Filport.
The alleged memorandum of the PPA Assistant General Manager exonerating Filport from any
liability arising from and as a result of the merger is contrary to public policy and is violative of the
workers' right to security of tenure. Said memorandum was issued in response to a query of the
PMU Officer-in-Charge and was not even published nor made known to the workers who came to
know of its existence only at the hearing before the NLRC. (G.R. No. 86026, pp. 93-94, Rollo)
The principle involved in the case cited by the First Division (Fernando v. Angat Labor Union [supra])
applies only when the transferee is an entirely new corporation with a distinct personality from the
integrating firms and NOT where the transferee was found to be merely an alter ego of the different
merging firms, as in this case. Thus, Filport has the obligation not only to absorb the workers of the
dissolved companies but also to include the length of service earned by the absorbed employees
with their former employees as well. To rule otherwise would be manifestly less than fair, certainly,
less than just and equitable.
Finally, to deny the private respondents the fruits of their labor corresponding to the time they
worked with their previous employers would render at naught the constitutional provisions on labor
protection. In interpreting the protection to labor and social justice provisions of the Constitution and
the labor laws, and rules and regulations implementing the constitutional mandate, the Supreme
Court has always adopted the liberal approach which favors the exercise of labor rights. (EuroLinea
Phils., Inc. v. NLRC, 156 SCRA 83).
WHEREFORE, the Resolution of the Second Division of this Court in G.R. No. 85704 dated
September 3, 1990 is hereby REITERATED.
SO ORDERED.
L. COMPROMISE SETTLEMENTS
220. PERIQUET VS. NLRC
CRUZ, J.:
It is said that a woman has the privilege of changing her mind but this is usually allowed only in
affairs of the heart where the rules are permissibly inconstant. In the case before us, Corazon
Periquet, the herein petitioner, exercised this privilege in connection with her work, where the rules
are not as fickle.
The petitioner was dismissed as toll collector by the Construction Development Corporation of the
Philippines, private respondent herein, for willful breach of trust and unauthorized possession of
accountable toll tickets allegedly found in her purse during a surprise inspection. Claiming she had
been "framed," she filed a complaint for illegal dismissal and was sustained by the labor arbiter, who
ordered her reinstatement within ten days "without loss of seniority rights and other privileges and
with fun back wages to be computed from the date of her actual dismissal up to date of her actual
reinstatement." 1 On appeal, this order was affirmed in toto by public respondent NLRC on August 29,
1980. 2
On March 11, 1989, almost nine years later, the petitioner filed a motion for the issuance of a writ of
execution of the decision. The motion was granted by the executive labor arbiter in an order dated
June 26, 1989, which requiredpayment to the petitioner of the sum of P205,207.42 "by way of
implementing the balance of the judgment amount" due from the private respondent. 3 Pursuant
thereto, the said amount was garnished by the NLRC sheriff on July 12, 1989. 4 On September 11, 1989,
however, the NLRC sustained the appeal of the CDCP and set aside the order dated June 20, 1989, the
corresponding writ of execution of June 26, 1989, and the notice of garnishment. 5
In its decision, the public respondent held that the motion for execution was time-barred, having
been filed beyond the five-year period prescribed by both the Rules of Court and the Labor Code. It
also rejected the petitioner's claim that she had not been reinstated on time and ruled as valid the
two quitclaims she had signed waiving her right to reinstatement and acknowledging settlement in
full of her back wages and other benefits. The petitioner contends that this decision is tainted with
grave abuse of discretion and asks for its reversal. We shall affirm instead.
Sec. 6, Rule 39 of the Revised Rules of Court, provides:
SEC. 6. Execution by motion or by independent action. A judgment may be
executed on motion within five (5) years from the date of its entry or from the date it
becomes final and executory. After the lapse of such time, and before it is barred by
the statute of limitations, a judgment may be enforced by action.
A similar provision is found in Art. 224 of the Labor Code, as amended by RA 6715, viz.
ART. 224. Execution of decision, orders, awards. (a) The Secretary of Labor and
Employment or any Regional Director, the Commission or any Labor Arbiter or MedArbiter, or the Voluntary Arbitrator may, motu propio, or on motion of any interested
party, issue a writ of execution on a judgment within five (5) years from the date it
becomes final and executory, requiring a sheriff or a duly deputized officer to execute
or enforce a final decision, order or award. ...
The petitioner argues that the above rules are not absolute and cites the exception snowed
in Lancita v. Magbanua,6 where the Court held:
Where judgments are for money only and wholly unpaid, and execution has been
previously withheld in the interest of the judgment debtor, which is in financial
difficulties, the court has no discretion to deny motions for leave to issue
execution more than five years after the judgments are entered. (Application of
Molnar, Belinsky, et al. v. Long Is. Amusement Corp., I N.Y.S, 2d 866)
In computing the time limited for suing out of an execution, although there is authority
to the contrary, the general rule is that there should not be included the time when
execution is stayed, either by agreement of the parties for a definite time, by
injunction, by the taking of an appeal or writ of error so as to operate as a
supersedeas, by the death of a party, or otherwise. Any interruption or delay
occasioned by the debtor will extend the time within which the writ may be issued
without scire facias.
xxx xxx xxx
There has been no indication that respondents herein had ever slept on their rights to
have the judgment executed by mere motions, within the reglementary period. The
statute of limitation has not been devised against those who wish to act but cannot
do so, for causes beyond their central.
Periquet insists it was the private respondent that delayed and prevented the execution of the
judgment in her favor, but that is not the way we see it. The record shows it was she who dillydallied.
The original decision called for her reinstatement within ten days from receipt thereof following its
affirmance by the NLRC on August 29, 1980, but there is no evidence that she demanded her
reinstatement or that she complained when her demand was rejected. What appears is that she
entered into a compromise agreement with CDCP where she waived her right to reinstatement and
received from the CDCP the sum of P14,000.00 representing her back wages from the date of her
dismissal to the date of the agreement. 7
Dismissing the compromise agreement, the petitioner now claims she was actually reinstated only
on March 16, 1987, and so should be granted back pay for the period beginning November 28,
1978, date of her dismissal, until the date of her reinstatement. She conveniently omits to mention
several significant developments that transpired during and after this period that seriously cast doubt
on her candor and bona fides.
After accepting the sum of P14,000.00 from the private respondent and waiving her right to
reinstatement in the compromise agreement, the petitioner secured employment as kitchen
dispatcher at the Tito Rey Restaurant, where she worked from October 1982 to March 1987.
According to the certification issued by that business, 8 she received a monthly compensation of
P1,904.00, which was higher than her salary in the CDCP.
For reasons not disclosed by the record, she applied for re-employment with the CDCP and was on
March 16,1987, given the position of xerox machine operator with a basic salary of P1,030.00 plus
P461.33 in allowances, for a total of P1,491.33 monthly. 9
On June 27, 1988; she wrote the new management of the CDCP and asked that the rights granted
her by the decision dated August 29, 1980, be recognized because the waiver she had signed was
invalid. 10
On September 19, 1988, the Corporate Legal Counsel of the private respondent (now Philippine
National Construction Corporation) recommended the payment to the petitioner of the sum of
P9,544.00, representing the balance of her back pay for three years at P654. 00 per month (minus
the P14,000.00 earlier paid). 11
On November 10, 1988, the petitioner accepted this additional amount and signed another Quitclaim
and Release reading as follows:
KNOW ALL MEN BY THESE PRESENTS:
THAT, I CORAZON PERIQUET, of legal age, married and resident of No. 87 Annapolis St., Quezon
City, hereby acknowledged receipt of the sum of PESOS: NINE THOUSAND FIVE HUNDRED
FORTY FOUR PESOS ONLY (P9,544.00) Philippine currency, representing the unpaid balance of
the back wages due me under the judgment award in NLRC Case No. AB-2-864-79 entitled
"Corazon Periquet vs. PNCC- TOLLWAYS" and I further manifest that this payment is in full
satisfaction of all my claims/demands in the aforesaid case. Likewise, I hereby manifest that I had
voluntarily waived reinstatement to my former position as TOLL TELLER and in lieu thereof, I sought
and am satisfied with my present position as XEROX MACHINE OPERATOR in the Central Office.
Finally, I hereby certify that delay in my reinstatement, after finality of the Decision dated 10 May
1979 was due to my own fault and that PNCC is not liable thereto.
I hereby RELEASE AND DISCHARGE the said corporation and its officers from money and all
claims by way of unpaid wages, separation pay, differential pay, company, statutory and other
benefits or otherwise as may be due me in connection with the above-entitled case. I hereby state
further that I have no more claims or right of action of whatever nature, whether past, present, future
or contingent against said corporation and its officers, relative to NLRC Case No. AB-2-864-79.
IN WITNESS WHEREOF, I have hereunto set my hand this 10th day of November 1988 at
Mandaluyong, Metro Manila. (Emphasis supplied.) 12
The petitioner was apparently satisfied with the settlement, for in the memorandum she sent the
PNCC Corporate Legal Counsel on November 24, 1988, 13 she said in part:
Sir, this is indeed my chance to express my gratitude to you and all others who have
helped me and my family enjoy the fruits of my years of stay with PNCC by way of
granting an additional amount of P9,544.00 among others ...
As per your recommendation contained therein in said memo, I am now occupying
the position of xerox machine operator and is (sic) presently receiving a monthly
salary of P2,014.00.
Reacting to her inquiry about her entitlement to longevity pay, yearly company increases and other
statutory benefits, the private respondent adjusted her monthly salary from P2,014.00 to P3,588.00
monthly.
Then the lull. Then the bombshell.
On March 11, 1989, she filed the motion for execution that is now the subject of this petition.
It is difficult to understand the attitude of the petitioner, who has blown hot and cold, as if she does
not know her own mind. First she signed a waiver and then she rejected it; then she signed another
waiver which she also rejected, again on the ground that she had been deceived. In her first waiver,
she acknowledged full settlement of the judgment in her favor, and then in the second waiver, after
accepting additional payment, she again acknowledged fun settlement of the same judgment. But
now she is singing a different tune.
In her petition she is now disowning both acknowledgments and claiming that the earlier payments
both of which she had accepted as sufficient, are insufficient. They were valid before but they are not
valid now. She also claimed she was harassed and cheated by the past management of the CDCP
and sought the help of the new management of the PNCC under its "dynamic leadership." But now
she is denouncing the new management-for also tricking her into signing the second quitclaim.
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. As in this case.
The question may be asked: Why did the petitioner sign the compromise agreement of September
16, 1980, and waive all her rights under the judgment in consideration of the cash settlement she
received? It must be remembered that on that date the decision could still have been elevated
on certiorari before this Court and there was still the possibility of its reversal. The petitioner
obviously decided that a bird in hand was worth two on the wing and so opted for the compromise
agreement. The amount she was then waiving, it is worth noting, had not yet come up to the
exorbitant sum of P205,207.42 that she was later to demand after the lapse of eight years.
The back pay due the petitioner need not detain us. We have held in countless cases that this
should be limited to three years from the date of the illegal dismissal, during which period (but not
beyond) the dismissed employee is deemed unemployed without the necessity of proof. 14 Hence, the
petitioner's contention that she should be paid from 1978 to 1987 must be rejected, and even without
regard to the fact (that would otherwise have been counted against her) that she was actually employed
during most of that period.
Finally, the petitioner's invocation of Article 223 of the Labor Code to question the failure of the
private respondent to file a supersedeas bond is not well-taken. As the SOLICITOR General
correctly points out, the bond is required only when there is an appeal from the decision with a
monetary award, not an order enforcing the decision, as in the case at bar.
As officers of the court, counsel are under obligation to advise their clients against making untenable
and inconsistent claims like the ones raised in this petition that have only needlessly taken up the
valuable time of this Court, the SOLICITOR General, the Government Corporate Counsel, and the
respondents. Lawyers are not merely hired employees who must unquestioningly do the bidding of
the client, however unreasonable this may be when tested by their own expert appreciation of the
pertinent facts and the applicable law and jurisprudence. Counsel must counsel.
WHEREFORE, the petition is DENIED, with costs against the petitioner. It is so ordered.
(NAMAWU-MIF) [G.R. No. 50402, August 19, 1982, 115 SCRA 873] support the conclusion that
private respondents still enjoyed a preferential lien for the payment of their backwages and
separation benefits over the properties of RMC which were foreclosed by petitioner [Rollo, pp. 2122].
Petitioner then filed its motion for reconsideration on December 24,1986 contending that Article 110
of the Labor Code finds no application in the case at bar for the following reasons: (1) The properties
sought to be delivered have ceased to belong to RMC in view of the fact that petitioner had
foreclosed on the mortgage, and the properties have been sold and delivered to third parties; (2) The
requisite condition for the application of Article 110 of the Labor Code is not present since
no BANKRUPTCY or insolvency proceedings over RMC properties and assets have been
undertaken [Rollo, pp. 24-28]. In an order dated July 29, 1987, petitioner's motion for reconsideration
was denied for lack of merit by Undersecretary Dionisio C. dela Serna.
Hence, petitioner filed this special civil action for certiorari with prayer for the issuance of a writ of
preliminary injunction. On August 27, 1987, this Court issued a temporary restraining order enjoining
public respondent from enforcing or carrying out its order dated July 29, 1987. After considering the
allegations made and issues raised in the petition, comments thereto and reply, the Court, on March
14, 1988, resolved to give due course to the petition and to require the parties to submit their
respective memoranda. Petitioner and private respondent submitted their memoranda, while public
respondent adopted as its memorandum the comment it had previously submitted.
After a careful study of the various arguments adduced, as well as the legal provisions and
jurisprudence on the matter, the Court finds the petition impressed with merit. Indeed, the assailed
Order suffers from infirmities which must be rectified by the grant of a writ of certiorari in favor of
petitioner.
Firstly, public respondent acted with grave abuse of discretion amounting to lack or excess of
jurisdiction in enforcing private respondents' right of first preference under Article 110 of the Labor
Code notwithstanding the absence of bankruptcy, LIQUIDATION or insolvency proceedings against
RMC.
Article 110 of the Labor Code and Section 10, Rule VIII, Book III of the Omnibus Rules Implementing
the Labor Code provide the following:
Article 110. WORKER PREFERENCE IN CASE OF BANKRUPTCY.In the event
of BANKRUPTCY or LIQUIDATION of an employer's business, his workers shall
enjoy first preference as regards wages due them for services rendered during the
period prior to the bankruptcy or LIQUIDATION , any provision of law to the contrary
notwithstanding. Unpaid wages shall be paid in full before other creditors may
establish any claim to a share in the assets of the employer [Emphasis supplied].
Section 10. PAYMENT OF WAGES IN CASE OF BANKRUPTCY. Unpaid wages
earned by the employees before the declaration of bankruptcy or
judicial LIQUIDATION of the employer's business shall be given first preference
and shall be paid in full before other creditors may establish any claim to a share in
the assets of the employer.
It is clear from the wording of the law that the preferential right accorded to employees and workers
under Article 110 may be invoked only during bankruptcy or judicial liquidation proceedings against
the employer. The law is unequivocal and admits of no other construction.
Respondents contend that the terms "bankruptcy" or "liquidation" are broad enough to cover a
situation where there is a cessation of the operation of the employer's business as in the case at bar.
However, this very same contention was struck down as unmeritorious in the case of Development
Bank of the Philippines vs. Hon. Labor Arbiter Ariel C. Santos [G.R. Nos. 78261-62, March 8, 1989]
involving a group of RMC employees which sought to enforce its preference of credit Article 110
against DBP over certain RMC real properties. In that case, the Court laid down the ruling that Article
110 of the Labor Code, which cannot be viewed in isolation of, and must always be reckoned with
the provisions of the Civil Code on concurrence and preference of credits, may not be invoked by
employees or workers of RMC like private respondents herein, in the absence of a formal
declaration of bankruptcy or a judicial liquidation order of RMC.
The rationale for making the application of Article 110 of the Labor Code contingent upon the
institution of BANKRUPTCY or judicial LIQUIDATION proceedings against the employer is
premised upon the very nature of a preferential right of credit. A preference of credit bestows upon
the preferred creditor an advantage of having his credit satisfied first ahead of other claims which
may be established against the debtor. Logically, it becomes material only when the properties and
assets of the debtor are insufficient to pay his debts in full; for if the debtor is amply able to pay his
various creditors in full, how can the necessity exist to determine which of his creditors shall be paid
first or whether they shall be paid out of the proceeds of the sale of the debtor's specific property?
Indubitably, the preferential right of credit attains significance only after the properties of the debtor
have been inventoried and LIQUIDATED , and the claims held by his various creditors have been
established [Kuenzle & Streiff (Ltd.) v. Villanueva, 41 Phil. 611 (1916); Barrette v. Villanueva, G.R.
No. L-14938, December 29, 1962, 6 SCRA 928; Philippine Savings Bank v. Lantin, G.R. No. L33929, September 2, 1983, 124 SCRA 476].
In this jurisdiction, bankruptcy, insolvency and general judicial liquidation proceedings provide the
only proper venue for the enforcement of a creditor's preferential right such as that established in
Article 110 of the Labor Code, for these are in rem proceedings binding against the whole world
where all persons having any interest in the assets of the debtor are given the opportunity to
establish their respective credits [Philippine Savings Bank v. Lantin, supra; Development Bank of the
Philippines v. Santos supra].
Secondly, public respondent's Order directing petitioner to deliver to the MOLE the properties it had
foreclosed from RMC for the purpose of executing the judgment rendered against RMC in Case No.
NCR-LSED 7-334-84 violates the basic rule that the power of a court or tribunal in the execution of
its judgment extends only over properties unquestionably belonging to the judgment debtor [Special
Services Corporation v. Centro La Paz, G.R. No. L- 44100, April 28, 1983, 121 SCRA 748; National
Mines and Allied Workers' Union v. Vera, G.R. No. L-44230, November 19, 1984, 133 SCRA 295].
It appears on record, and remains undisputed by respondents, that petitioner had extra-judicially
foreclosed the subject properties from RMC as early as 1983 and purchased the same at public
auction, and that RMC had failed to exercise its right to redeem. Thus, when Officer-in-Charge
Young issued on December 11, 1986 the order which directed the delivery of these properties to the
MOLE, RMC had ceased to be the absolute owner thereof [See Dizon v. Gaborra, G.R. No. L-36821,
June 22, 1978, 83 SCRA 688]. Consequently, the order was directed against properties which no
longer belonged to the judgment debtor RMC.
However, respondents, in citing the case of PCIB v. NAMAWU-MIF [supra], argue that by virtue of
Article 110 of the Labor Code, an "automatic first lien" was created in favor of private respondents on
RMC propertiesa "lien" which predated the FORECLOSURE of the subject properties by
petitioner, and remained vested on these properties even after its sale to petitioner and other parties.
There is no merit to this contention. It proceeds from a misconception which must be corrected.
What Article 110 of the Labor Code establishes is not a lien, but a preference of credit in favor of
employees [See Republic v. Peralta, G.R. No. 56568, May 20, 1987, 150 SCRA 37]. This simply
means that during bankruptcy, insolvency or liquidation proceedings involving the existing properties
of the employer, the employees have the advantage of having their unpaid wages satisfied ahead of
certain claims which may be proved therein.
It bears repeating that a preference of credit points out solely the order in which creditors would be
paid from the properties of a debtor inventoried and appraised during BANKRUPTCY
, INSOLVENCY or liquidation proceedings. Moreover, a preference does not exist in any effective
way prior to, and apart from, the institution of these proceedings, for it is only then that the legal
provisions on concurrence and preference of credits begin to apply. Unlike a lien, a preference of
credit does not create in favor of the preferred creditor a charge or proprietary interest upon any
particular property of the debtor. Neither does it vest as a matter of course upon the mere accrual of
a money claim against the debtor. Certainly, the debtor could very well sell, mortgage or pledge his
property, and convey good title thereon, to third parties free from such preference [Kuenzle & Streiff
v. Villanueva, supra].
Incidentally, the Court is not unmindful of the 1989 amendments to the article introduced by Section
1, R.A. No. 6715 [March 21, 1989]. Article 110 of the Labor Code as amended reads:
WORKER PREFERENCE IN CASE OF BANKRUPTCY. In the event of bankruptcy
or liquidation of an employer's business, his workers shall enjoy first preference as
regards their unpaid wages and other monetary claims, any provision of law to the
contrary notwithstanding. Such unpaid wages and monetary claims shall be paid in
full before the claims of the Government and other creditors may be paid.
[Amendments indicated.]
However, these amendments only relate to the scheme of concurrence and preference of credits;
they do not affect the issues heretofore discussed regarding the applicability of Article 110 to the
attendant facts.
WHEREFORE, considering the foregoing, the present petition is hereby GRANTED. The assailed
order dated July 29, 1987 is SET ASIDE and the temporary restraining order issued by the Court on
August 27, 1987 is made PERMANENT.
SO ORDERED.
The foregoing Summarizes this Court's grant of the Petition for Certiorari under
Rule 65 of the Rules of Court, assailing the April 26, 1996 Resolution [2] promulgate by
the NLRC[3] which upheld the labor arbiter's refusal to suspend proceedings involving,
monetary claims of the petitioner's employees.
Petitioner likewise assails the June 20, 1996 NLRC Resolution [4] which denied its
Motion for Reconsideration.
On November 20, 1996, this Court issued a temporary restraining order signed by
then Chief Justice Andres R. Narvasa, "restraining the public respondents from further
conducting proceedings in the aforesaid cases effective immediately xxx."
The Facts
The facts are undisputed. They are narrated by the Office of the SOLICITOR
General as follows:
of private respondents in the labor cases because said claims and the
concomitant liability of petitioners still had to be determined, thus carrying no
dissipation of the assets of petitioners.
"Petitioners appealed the adverse order of the Labor Arbiter to public
respondent which, in a Resolution dated April 26, 1996, dismissed the appeal
for lack of merit and, instead, sustained the rulings of the Labor Arbiter.
"The motion for reconsideration of petitioners fared no better and was denied
by public respondent in a Resolution dated June 20, 1996."[5]
Hence, this petition.[6]
The Issue
Suspension Proceedings
"xxx where the petition filed is one for declaration of a state of suspension of
payments due to a recognition of the inability to pay one's debts and
liabilities, and where the petitioning corporation either: (a) has sufficient
property to cover all its debts but foresees the impossibility of meeting them
when they fall due (solvent but illiquid) or (b) has no sufficient property
(insolvent) but is under the management of a rehabilitation receiver or a
xxx
xxx
xxx
xxx
The SOLICITOR general, representing Public Respondent NLRC, argues that the
rationale for an automatic stay will not be frustrated even if the NLRC proceeds with the
disposition of these labor cases, because any favorable judgment obtained by the
private respondents would only establish their rights as creditors. The solicitor general
also contends that the assailed Resolutions of the NLRC will not result in an undue
preference for the assets of Rubberworld, as the private respondents will still present
their claims before the management committee. [12]
We disagree. The law is clear: upon the creation of a management committee or
the appointment of rehabilitation receiver, all claims for actions "shall be suspended
accordingly." No exception in favor of labor claims is mentioned in the law. Since the
law makes no distinction or exemptions, neither should this Court. Ubi lex non distinguit
nec nos distinguere debemos. [13] Allowing labor cases to proceed clearly defeats the
purpose of the automatic stay and severely encumbers the management committee's
time and resources. The said committee would need to defend against these suits, to
the detriment of its primary and urgent duty to work towards rehabilitating the
corporation and making it viable again. To rule otherwise would open the floodgates to
other similarly situated claimants and forestall if not defeat the rescue efforts. Besides,
even if the NLRC awards the claims of private respondents, as it did, its ruling could not
be enforced as long as the petitioner is under the management committee.[14]
In Chua v. National Labor Relation Commission, [15] we ruled that labor claims cannot
proceed independently of a BANKRUPTCY LIQUIDATION proceeding, since these
claims "would spawn needless controversy, delays, and confusion." [16] With more
reason, allowing labor claims to continue in spite of a SEC suspension order in
rehabilitation case would merely lead to such results.
The solicitor general insists that since Article 217 of the Labor Code [17] vested public
respondent with jurisdiction to hear and decide these labor cases, the NLRC did not
exceed its jurisdiction when it refused to suspend the proceedings therein. [18] The Court
is not persuaded.
Article 217 of the Labor Code should be construed not in isolation but in harmony
with PD 902-A, according to the basic rule in statutory construction that implied repeals
are not favored.[19]Indeed, it is axiomatic that each and every statute must be construed
in a way that would avoid conflict with existing laws. [20] True, the NLRC has the power to
hear and decide labor disputes, but such authority is deemed suspended when PD 902A is put into effect by the Securities and Exchange Commission.
Preference in Favor of Workers in Case of BANKRUPTCY
or LIQUIDATION
The private respondents contend that automatic stay under PD 902-A is not
applicable to the instant case; otherwise, the preference granted to workers by Article
110 of the Labor Code would be rendered ineffective. [21] This contention is misleading.
The preferential right of workers and employees under Article 110 of the
Labor Code may be invoked only upon the institution of INSOLVENCY or judicial
liquidation proceeding.[22] Indeed, it is well-settled that "a declaration of bankruptcy or a
judicial liquidation must be present before preferences over various money claims may
be enforced."[23] But debtors resort to preference of credit -- giving preferred creditors the
right to have their claims paid ahead of those of other claimants -- only when their
assets are insufficient to pay their debts fully.[24] The purpose of rehabilitation
proceedings is precisely to enable the company to gain a new lease on life and
thereby allow creditors to be paid their claims from its earnings. In insolvency
proceedings, on the other hand, the company stops operating, and the claims of
creditors are satisfied from the assets of the insolvent corporation. The present case
involves the rehabilitation, not the liquidation, of petitioner-corporation. Hence, the
preference of credit granted to workers or employees under Article 110 of the Labor
Code is not applicable.
Duration of Automatic Stay Under PD 902-A
Finally, private respondents posit that under Section 6 of the Insolvency Law, the
December 28, 1994 Order of the SEC suspending all actions for claims against
Rubberworld should have expired after three months, in the absence of an agreement
between the company and the corporate creditors. [25] Private respondents also accuse
the SEC of abusing its power by "allowing said suspension order to remain pending for
many years without resolving and approving any rehabilitation plan."[26] They contend
that "[t]his is fatal to the instant petition for it had been a party to the abuse by the SEC
of its suspension order."[27]
This Court notes that PD 902-A itself does not provide for the duration of the
automatic stay. Neither does the Order[28] of the SEC. Hence, the suspensive effect
has no time limit and remains in force as long as reasonably necessary to accomplish
the purpose of the Order.[29] On the other hand, the attack against the SEC's alleged
"abuse of power" is misplaced. Under review in this Petition for Certiorari are Resolutions
of the NLRC, not of the SEC. The scope of this review is thus limited to whether the
NLRC gravely abused or exceeded its jurisdiction in refusing to heed the SEC Order of
Suspension and in issuing its challenged Resolutions. In any event, the bare allegation
of inaction is insufficient to condemn the Securities and Exchange Commission and the
management committee where, it should be noted, all affected parties, including, the
labor union in the company, are represented.
WHEREFORE, the petition is hereby GRANTED. The assailed Resolutions of the
NLRC dated April 26, 1996, and June 20, 1996, are REVERSED and SET ASIDE. No
costs.
SO ORDERED.
On April 18, 1983, respondent Carnation appealed to respondent National Labor Relations
Commission [NLRC] which in a decision dated February 25, 1985, 1 set aside the decision of the Labor
Arbiter. It declared the complaint for illegal dismissal filed by Virgilio Callanta to have already prescribed.
Thus:
Records show that Virgilio Callanta was dismissed from his employment with
respondent company effective June 1, 1979; and that on 5 July 1982, he filed the
instant complaint against respondent for: Unlawful Dismissal with Backwages, etc.
The provisions of the Labor Code applicable are:
Art. 291. Offenses. Offenses penalized under this Code and the rules and
regulations issued pursuant thereto shall prescribe in three [3] years.
Art. 292. Money claims. All money claims arising from employer-employee
relations accruing during the effectivity of this Code shall be filed within three [3]
years from the time the cause of action accrued; otherwise, they shall be forever
barred.
Obviously, therefore, the causes of action, i.e., "Unlawful Dismissal" and
"Backwages, etc." have already prescribed, the complaint therefore having been filed
beyond the three-year period from accrual date.
With this finding, there is no need to discuss the other issues raised in the appeal.
WHEREFORE, in view of the foregoing, the Decision appealed from is hereby SET
ASIDE and another one entered, dismissing the complaint.
SO ORDERED.
Hence, this petition, which We gave due course in the resolution dated September 18, 1985. 2
Petitioner contends that since the Labor Code is silent as to the prescriptive period of an action for illegal
dismissal with claims for reinstatement, backwages and damages, the applicable law, by way of
supplement, is Article 1146 of the New Civil Code which provides a four [4]-year prescriptive period for an
action predicated upon "an injury to the rights of the plaintiff" considering that an action for illegal
dismissal is neither a "penal offense" nor a mere "money claim," as contemplated under Articles 291 and
292, respectively, of the Labor Code. Petitioner further claims that an action for illegal dismissal is a more
serious violation of the rights of an employee as it deprives him of his means of livelihood; thus, it should
correspondingly have a prescriptive period longer than the three 13] years provided for in "money claims."
Public respondent, on the other hand, counters with the arguments that a case for illegal dismissal
falls under the general category of "offenses penalized under this Code and the rules and
regulations pursuant thereto" provided under Article 291 or a money claim under Article 292, so that
petitioner's complaint for illegal dismissal filed on July 5, 1982, or three [3] years, one [1] month and
five [5] days after his alleged dismissal on June 1, 1979, was filed beyond the three-year prescriptive
period as provided under Articles 291 and 292 of the Labor Code, hence, barred by prescription; that
while it is admittedly a more serious offense as it involves an employee's means of livelihood, there
is no logic in assuming that it has a longer prescriptive period, as naturally, one who is truly
aggrieved would immediately seek the redress of his grievance; that assuming arguendo that the law
does not provide for a prescriptive period for the enforcement of petitioner's right, it is nevertheless
beyond dispute that the said right has already lapsed into a stale demand; and that considering the
seriousness of the act committed by petitioner, private respondent was justified in terminating the
employment.
We find for petitioner.
Verily, the dismissal without just cause of an employee from his employment constitutes a violation
of the Labor Code and its implementing rules and regulations. Such violation, however, does not
amount to an "offense" as understood under Article 291 of the Labor Code. In its broad sense, an
offense is an illegal act which does not amount to a crime as defined in the penal law, but which by
statute carries with it a penalty similar to those imposed by law for the punishment of a crime. 3 It is in
this sense that a general penalty clause is provided under Article 289 of the Labor Code which provides
that "... any violation of the provisions of this code declared to be unlawful or penal in nature shall be
punished with a fine of not less than One Thousand Pesos [P1,000.00] nor more than Ten Thousand
Pesos [10,000.00], or imprisonment of not less than three [3] months nor more than three [3] years, or
both such fine and imprisonment at the discretion of the court." [Emphasis supplied.]
The confusion arises over the use of the term "illegal dismissal" which creates the impression that
termination of an employment without just cause constitutes an offense. It must be noted, however
that unlike in cases of commission of any of the probihited activities during strikes or lockouts under
Article 265, unfair labor practices under Article 248, 249 and 250 and illegal recruitment activities
under Article 38, among others, which the Code itself declares to be unlawful, termination of an
employment without just or valid cause is not categorized as an unlawful practice.
Besides, the reliefs principally sought by an employee who was illegally dismissed from his
employment are reinstatement to his former position without loss of seniority rights and privileges, if
any, backwages and damages, in case there is bad faith in his dismissal. As an affirmative relief,
reinstatement may be ordered, with or without backwages. While ordinarily, reinstatement is a
concomitant of backwages, the two are not necessarily complements, nor is the award of one a
condition precedent to an award of the other. 4 And, in proper cases, backwages may be awarded
without ordering reinstatement . In either case, no penalty of fine nor improsonment is imposed on the
employer upon a finding of illegality in the dismissal. By the very nature of the reliefs sought, therefore, an
action for illegal dismissal cannot be generally categorized as an "offense" as used under Article 291 of
the Labor Code, which according to public respondent, must be brought within the period of three[3] years
from the time the cause of action accrued, otherwise, the same is forever barred.
It is true that the "backwwages" sought by an illegally dismissed employee may be considered, by
reason of its practical effect, as a "money claim." However, it is not the principal cause of action in an
illegal dismissal case but the unlawful deprivation of the one's employment committed by the
employer in violation of the right of an employee. Backwages is merely one of the reliefs which an
illegally dismissed employee prays the labor arbiter and the NLRC to render in his favor as a
consequence of the unlawful act committed by the employer. The award thereof is not private
compensation or damages 5 but is in furtherance and effectuation of the public objectives of the Labor
Code. 6even though the practical effect is the enrichment of the individual, the award of backwages is not
inredness of a private right, but, rather, is in the nature of a command upon the employer to make public
reparation for his violation of the Labor Code. 7
The case of Valencia vs. Cebu Portland Cement, et al., 106 Phil. 732, a 1959 case cited by petitioner, is
applicable in the instant case insofar as it concerns the issue of prescription of actions. In said case, this
Court had occasion to hold that an action for damages involving a plaintiff seperated from his employment
for alleged unjustifiable causes is one for " injury to the rights of the plaintiff, and must be brought within
four [4] years. 8
In Santos vs. Court of Appeals, 96 SCRA 448 [1980], this Court, thru then Chief Justice Enrique M.
Fernando, sustained the sand of the Solicitor General that the period of prescription mentioned under
Article 281, now Article 292, of the Labor Code, refers to and "is limited to money claims, an other cases
of injury to rights of a workingman being governed by the Civil Code." Accordingly, this Court ruled that
petitioner Marciana Santos, who sought reinstatement, had four [4] years within which to file her
complaint for the injury to her rights as provided under Article 1146 of the Civil Code.
Indeed there is, merit in the contention of petitioner that the four [4]-year prescriptive period under
Article 1146 of the New Civil Code, applies by way of supplement, in the instant case, to wit:
Art. 1146. The following actions must be instituted within four years.
[1] Upon an injury to the lights of the plaintiff.
xxx xxx xxx
[Emphasis supplied]
As this Court stated in Bondoc us. People's Bank and Trust Co., 9 when a person has no property, his
job may possibly be his only possession or means of livelihood, hence, he should be protected against
any arbitrary and unjust deprivation of his job. Unemployment, said the Court in Almira vs. B.F. Goodrich
Philippines, 10 brings "untold hardships and sorrows on those dependent on the wage earners. The misery
and pain attendant on the loss of jobs thus could be avoided if there be acceptance of the view that under
all the circumstances of this case, petitioners should not be deprived of their means of livelihood."
It is a principle in American jurisprudence which, undoubtedly, is well-recognized in this jurisdiction
that one's employment, profession, trade or calling is a "property right," and the wrongful interference
therewith is an actionable wrong. 11 The right is considered to be property within the protection of a
constitutional guaranty of due process of law. 12 Clearly then, when one is arbitrarily and unjustly deprived
of his job or means of livelihood, the action instituted to contest the legality of one's dismissal from
employment constitutes, in essence, an action predicated "upon an injury to the rights of the plaintiff," as
contemplated under Art. 1146 of the New Civil Code, which must be brought within four [4] years.
In the instant case, the action for illegal dismissal was filed by petitioners on July 5, 1982, or three [3]
years, one [1] month and five [5] days after the alleged effectivity date of his dismissal on June 1,
1979 which is well within the four [4]-year prescriptive period under Article 1146 of the New Civil
Code.
Even on the assumption that an action for illegal dismissal falls under the category of "offenses" or
"money claims" under Articles 291 and 292, Labor Code, which provide for a three-year prescriptive
period, still, a strict application of said provisions will not destroy the enforcement of fundamental
rights of the employees. As a statutory provision on limitations of actions, Articles 291 and 292 go to
matters of remedy and not to the destruction of fundamental rights. 13 As a general rule, a statute of
limitation extinguishes the remedy only. Although the remedy to enforce a right may be barred, that right
may be enforced by some other available remedy which is not barred. 14
More so, in the instant case, where the delay in filing the case was with justifiable cause. The threat to
petitioner that he would be charged with estafa if he filed a complaint for illegal dismissal, which private
respondent did after all on June 22, 1981, justifies, the delayed filing of the action for illegal dismissal with
the Regional Office No. X, MOLE on July 5, 1982. Laches will not in that sense strengthen the cause of
public respondent. Besides, it is deemed waived as it was never alleged before the Labor Arbiter nor the
NLRC.
Public respondent dismissed the action for illegal dismissal on the sole issue of prescription of
actions. It did not resolve the case of illegal dismissal on the merits. Nonetheless, to resolve once
and for all the issue of the legality of the dismissal, We find that petitioner, who has continuously
served respondent Carnation for five [5] years was, under the attendant circumstances, arbitrarily
dismissed from his employment. The alleged shortage in his accountabilities should have been
impartially investigated with all due regard for due process in view of the admitted enmity between
petitioner and E.L. Corsino, respondent's auditor. 15 Absent such an impartial investigation, the alleged
shortage should not have been attended with such a drastic consequence as termination of the
employment relationship. Outright dismissal was too severe a penalty for a first offense, considering that
the alleged shortage was explained to respondent's Auditor, E.L. Corsino, in accordance with
respondent's accounting and auditing policies.
The indecent haste of his dismissal from employment was, in fact, aggravated by the filing of the
estafa charge against petitioner with the City Fiscal of Butuan City on June 22, 1981, or two [2] years
after his questioned dismissal. After the case had remained pending for five [5] years, the Regional
Trial Court of Agusan del Norte and Butuan City, Branch V finally dismissed the same provisionally in
an order dated February 21, 1986 for failure of the prosecution's principal witness to appear in court.
Admittedly, loss of trust and confidence arising from the same alleged misconduct is sufficient
ground for dismissing an employee from his employment despite the dismissal of the criminal
case. 16 However, it must not be indiscriminately used as a shield to dismiss an employee
arbitrarily. 17 For, who can stop the employer from filing all the charges in the books for the simple exercise
of it, and then hide behind the pretext of loss of confidence which can be proved by mere preponderance
of evidence.
We grant the petition and the decision of the NLRC is hereby reversed and set aside. Although We
are strongly inclined to affirm that part of the decision of the Labor Arbiter ordering the reinstatement
of petitioner to his former position without loss of seniority rights and privileges, a supervening event,
which petitioner mentioned in his motion for early decision dated January 6, 1986 18 that is, FILIPRO,
Inc.'s taking over the business of Carnation, has legally rendered the order of reinstatement difficult to
enforce, unless there is an express agreement on assumption of liabilities 19by the purchasing
corporation, FILIPRO, Inc. Besides, there is no law requiring that the purchasing corporation should
absorb the employees of the selling corporation. 20 In any case, the very concept of social justice dictates
that petitioner shall be entitled to backwages of three [3] years. 21
WHEREFORE, respondent Carnation Philippines, Inc. is hereby ordered to pay petitioner Virgilio Callanta
backwages for three [3] years without qualification and deduction. This decision is immediately executory.
No costs.
SO ORDERED.
xxx
xxx
SO ORDERED. 4
On May 19, 1994, complainants in the abovementioned labor case filed before the Commission a
motion for the issuance of a writ of execution as respondent's appeal to the Commission and this
Court5 were respectively denied.
On June 16, 1994, Executive Labor Arbiter Gelacio C. Rivera, Jr. to whom the case was reassigned
in view of Labor Arbiter Olegario's transfer, issued a writ of execution6 directing NLRC Deputy
Sheriff Adam Ventura to execute the judgment against respondents, Green Mountain Farm, Roberto
Ongpin and Almus Alabe Sheriff Ventura then proceeded to enforce the writ by garnishing certain
personal properties of respondents. Findings that said judgment debtors do not have sufficient
personal properties to satisfy the monetary award, Sheriff Ventura proceeded to levy upon a real
property covered by Tax Declaration No. 9697, registered in the name of Roberto Ongpin, one of
the respondents in the labor case. Thereafter, Sheriff Ventura caused the publication on the July 17,
1994 edition of the Baguio Midland Courier the date of the public auction of said real property.
On July 27, 1994, a month before the scheduled auction sale, herein petitioner filed before the
Commission a third-party claim7 asserting ownership over the property levied upon and subject of
the Sheriff notice of sale. Labor Arbiter Rivera thus issued an order directing the suspension of the
auction sale until the merits of petitioner's claim has been resolved. 8
However, on August 16, 1994, petitioner filed with the Regional Trial Court of La Trinidad, Benguet a
complaint for injunction and damages, with a prayer for the issuance of a temporary retraining order
against Sheriff Ventura, reiterating the same allegations it raised in the third party claim it field with
the Commission. The petition was docketed as Civil Case No. 94-CV-0948, entitled "Deltaventures
Resources, Inc., petitioner vs. Adam P. Ventura, etal., defendants." The next day, August 17, 1994,
respondent Judge Cabato issued a temporary restraining order, enjoining respondents in the civil
case before him to hold in abeyance any action relative to the enforcement of the decision in the
labor case.9
Petitioner likewise filed on August 30, 1994, an amended complaint10 to implead Labor arbiter Rivera
and herein private respondent-laborers.
Further, on September 20, 1994, petitioner, filed with the Commission a manifestation11 questioning
the latter's authority to hear the case, the matter being within the jurisdiction of the regular courts.
The manifestation however, was dismissed by Labor arbiter Rivera on October 3, 1994. 12
Meanwhile, on September 20, 1994, private respondent-laborers, moved for the dismissal of the civil
case on the ground of the court's lack of jurisdiction. 13 Petitioner filed its opposition to said motion on
October 4, 1994.14
On November 7, 1994, after both parties had submitted their respective briefs, respondent court
rendered its assailed decision premised on the following grounds:
First, this Court is equal rank with the NLRC, hence, has no jurisdiction to issue an injunction
against the execution of the NLRC decision. . . .
Second, the NLRC retains authority over all proceedings anent the execution of its decision.
This power carries with it the right to determine every question which may be involved in the
execution of its decision. . . .
Third, Deltaventures Resources, Inc. should rely on and comply with the Rules of the NLRC
because it is theprincipal procedure to be followed, the Rules of Court being merely
suppletory in application, . . .
Fourth, the invocation of estoppel by the plaintiffs is misplaced. . . . . [B]efore the defendants
have filed their formal answer to the amended complaint, they moved to dismiss it for lack of
jurisdiction.
Lastly, the plaintiff, having in the first place addressed to the jurisdiction of the NLRC by filing
with it a Third Party Claim may not at the same time pursue the present amended Complaint
under the forum shoppingrule.15
Their motion for reconsideration having been denied by respondent Judge,
this petition now before us.
16
In spite of the many errors assigned by petitioner,17 we find that here the core issue is whether or not
the trial court may take cognizance of the complaint filed by petitioner and consequently provide the
injunction relief sought. Such cognizance in turn, would depend on whether the acts complained of
are related to, connected or interwoven with the cases falling under the exclusive jurisdiction of the
Labor arbiter or the NLRC.
Petitioner avers that court a quo erred in dismissing the third-party claim on the ground of lack of
jurisdiction. Further, it contends that the NLRC-CAR did not acquire jurisdiction over the claim for it
did not impugn the decision of the NLRC-CAR but merely questioned the propriety of the levy made
by Sheriff Ventura. In support of its claim, petitioner asserts that the instant case does not involve a
labor dispute, as no-employer-employee relationship exists between the parties. Nor is the
petitioner's case related in any way to either parties' case before the NLRC-CAR hence, not within
the jurisdiction of the Commission.
Basic as a hornbook principle, jurisdiction over the subject matter of a case is conferred by law and
determined by the allegations in the complainant18 which comprise a concise statement of the
ultimate facts constituting the petitioner's cause of action.19 Thus we have held that:
Jurisdiction over the subject-matter is determined upon the allegations made in the
complainant, irrespective of whether the plaintiff is entitled or not entitled to recover upon the
claim asserted therein - a matter resolved only after and as a result of the trial. 20
Petitioner filed the third-party claim before the court a quo by reason of a writ of execution issued by
the NLRC-CAR Sheriff against a property to which it claims ownership. The writ was issued to
enforce and execute the commission's decision in NLRC Case No. 01-08-0165-89 (Illegal Dismissal
and Unfair Labor Practice) against Green Mountain Farm, Roberto Ongpin and Almus Alabe.
Ostensibly the complaint before the trial court was for the recovery of possession and injunction, but
in essence it was an action challenging the legality or propriety of the levy vis-a-vis the alias writ of
execution, including the acts performed by the Labor Arbiter and the Deputy Sheriff implementing the
writ. The complainant was in effect a motion to quash the writ of execution of a decision rendered on
a case properly within the jurisdiction of the Labor Arbiter, to wit: Illegal Dismissal and Unfair Labor
Practice. Considering the factual setting, it is then logical to conclude that the subject matter of the
third party claim is but an incident of the labor case, a matter beyond the jurisdiction of regional trial
courts.
Precedents abound confirming the rule that said courts have no labor jurisdiction to act on labor
cases or various incidents arising therefrom, including the execution of decisions, awards or
orders.21 Jurisdiction to try and adjudicate such cases pertains exclusively to the proper labor official
concerned under the Department of Labor and Employment. To hold otherwise is to sanction split
jurisdiction which is obnoxious to the orderly administration of justice. 22
Petitioner failed to realize that by filing its third-party claim with the deputy sheriff, it submitted itself
to the jurisdiction of the Commission acting through the Labor Arbiter. It failed to perceive the fact
that what it is really controverting is the decision of the Labor arbiter and not the act of the deputy
sheriff in executing said order issued as a consequence of said decision rendered.
1wphi1
Jurisdiction once acquired is not lost upon the instance of the parties but continues until the case is
terminated.23Whatever irregularities attended the issuance and execution of the alias writ of
execution should be referred to the same administrative tribunal which rendered the decision. 24 This
is because any court which issued a writ of execution has the inherent power, for the advancement
of justice, to correct errors of its ministerial officers and to control its own processes. 25
The broad powers granted to the Labor Arbiter and to the National Labor Relations Commission by
Articles 217, 218 and 224 of the Labor Code can only be interpreted as vesting in them jurisdiction
over incidents arising from, in connection with or relating to labor disputes, as the controversy under
consideration, to the exclusion of the regular courts.
Having established that jurisdiction over the case rests with the Commission, we find no grave abuse
of discretion on the part of respondent Judge Cabato in denying petitioner's motion for the issuance
of an injunction against the execution of the decision of the National Labor Relations Commission.
Moreover, it must be noted that the Labor Code in Article 254 explicitly prohibits issuance of a
temporary or permanent injunction or restraining order in any case involving or growing out of labor
disputes by any court or other entity (except as otherwise provided in Arts. 218 and 264). As
correctly observed by court a quo, the main issue and the subject of the amended complaint for
injunction are questions interwoven with the execution of the Commission's decision. No doubt the
aforecited prohibition in Article 254 is applicable.
1wphi1
Petitioner should have filed its third-party claim before the Labor Arbiter, from whom the writ of
execution originated, before instituting said civil case. The NLRC's Manual on Execution of
Judgment,26 issued pursuant to Article 218 of the Labor Code, provides the mechanism for a thirdparty claimant to assert his claim over a property levied upon by the sheriff pursuant to an order or
decision of the Commission or of the Labor Arbiter. The power of the Labor Arbiter to issue a writ of
execution carries with it the power to inquire into the correctness of the execution of his decision and
to consider whatever supervening events might transpire during such execution.
Moreover, in denying petitioner's petition for injunction, the court a quo is merely upholding the timehonored principle that a Regional Trial Court, being a co-equal body of the National Labor Relations
Commission, has no jurisdiction to issue any restraining order or injunction to enjoin the execution of
any decision of the latter.27
WHEREFORE, the petition for certiorari and prohibition is DENIED. The assailed Orders of
respondent Judge Fernando P. Cabato dated November 7, 1994 and December 14, 1994,
respectively are AFFIRMED. The records of this case are hereby REMANDED to the National Labor
Relations Commission for further proceedings.
1wphi1.nt
The labor conflict between the parties broke out in the open when
the petitioner union 1 struck on April 6, 1992 protesting issues ranging from unfair labor practices and
union busting allegedly committed by the private respondent. 2 The union picketed the premises of the
private respondent at Bagumbayan and Longos in Quezon City; Angono and Antipolo in Rizal; San
Fernando, Pampanga and San Pedro, Laguna.
The strike hurt the private respondent. On April 8, 1992, it filed with the NLRC a petition for
injunction 3 to stop the strike which it denounced as illegal. It alleged:
xxx xxx xxx
13. On April 6, 1992, at around 7:00 p.m., respondents led by its officers and some
members staged a wild-cat strike, without a valid notice of strike, nor observing
cooling-off period, and made even during the pendency of a preventive mediation
proceedings which was still scheduled for April 10, 1992;
14. And during the said wild-cat strike, respondents have set-up makeshifts, tents,
banners and streamers and other man-made obstructions at the main plant and
offices of petitioner which effectively impeding, as in fact still effectively impeding the
ingress and egress of persons who have lawful business with the petitioner;
15. Furthermore, respondents have resorted, as in fact still resorting to, unlawful and
illegal acts including among others threats, intimidations and coercions against
persons who have lawful business with the petitioner and the non-striking employees
who wish to return to work;
16. Without complying with the legal requirements for a valid strike, respondents'
staging of the said "wild-cat strike", is by law considered as illegal or unlawful act
which must be enjoined;
17. As a direct result of the aforesaid unlawful and illegal acts of the respondents,
petitioner which has on-going projects for the government and other private entities
which require completion on and agreed schedule, is at great and imminent danger
to suffer substantial damages and injury, which if not urgently redressed, will
inevitably become irreparable;
18. Said prohibited and unlawful acts have been threatened and will continuously be
committed unless the injunction or temporary restraining order be issued against the
respondents; (pp. 2-5, Records).
xxx xxx xxx
23. The injury and damages to the government of Republic of the Philippines, the
petitioner and other persons are unavoidable, so much so that the issuance of a
Temporary Restraining Order without notice becomes imperative, as the police
officers or agents of authority called upon to enforce the right to ingress and egress
are unable to do so; (p. 6, ibid)
The petition was set for hearing on April 13, 1992 at 3 p.m. The union, however, claimed that it was
not furnished a copy of the petition. Allegedly, the company misrepresented its address to be at Rm.
205-6 Herald Bldg., Muralla St., Intramuros, Manila.
On April 13, 1992, the NLRC heard the evidence of the company alone. The ex parte hearing started
at 2:30 p.m. where testimonial and documentary evidence were presented. 4 Some thirty (30) minutes
later, an Ocular Inspection Report was submitted by an unnamed NLRC representative 5 which reads:
OCULAR INSPECTION REPORT
Authorization dated April 13, 1992 was issued to the effect of directing the
undersigned to conduct an ocular inspection of the premises of the petitioner located
at Bagumbayan, Quezon City.
The inspection was conducted immediately upon receipt hereof.
OBSERVATION
The passage was obstructed with pieces of rock, an old ladder, pieces of wood and
other hard objects that gave rise to a strong indication that the passage to and from
the premises was not free. The barricades and obstruction were put up fifty (50)
meters or less away from the main gate.
The business operation was completely paralized (sic) as no person was noticed
inside the company compound. No persons and/or vehicles were seen entering and
leaving the premises. Ingress to and engress from the company is presumed to be
not free.
Before the day was over, the respondent NLRC (First Division) issued a temporary restraining order
against the union, viz.:
. . . RESOLVED, to issue a Temporary Restraining Order valid for twenty (20) days,
subject to petitioner's posting of a cash or surety bond of Twenty Thousand
(P20,000.00) Pesos conditioned to recompense respondents for any loss, expense
or damage they may suffer in the event it is eventually found out that petitioner is not
entitled to the relief sought and herein granted, DIRECTING: a) the respondents,
their agents and symphatizers to remove (subject to their right to conduct a lawful
picket) the man made barricades/obstructions complained of and to direct from
further preventing and/or impeding the free ingress to and egress from petitioner's
main plant and office premises of its employees, officials, vehicles, customers or any
party who may want to transact business thereat through the use of any obstructive
means prohibited by law; b) any officer from the Legal Division of this Commission to
ensure compliance of the foregoing restraining order and where necessary, to enlist
report to work or transact business with the company, or by calling at their houses or
places of residence, and then and there coerce not to report for work on pain of
bodily harm; As proof thereof, petitioner attaches the affidavit of
Atty. Elmer Jolo, Augusto Bautista, Ronnie Mercado, among others, as Annexes "A",
"B" and "C" and made integral parts thereof.
8. For these reasons, said workers and persons are constrained to refrain from
reporting for work or from transacting business with the company;
9. Finally, no less than the president of the Union, supported by the leaders of the
strikers, threatened that upon the expiration of the validity of the temporary
restraining order, they will "sisimentuhin namin and gates ng Concrete Aggregates
na kahit ipis ay hindi makakapasok at makakalabas" ("We will cement the gates of
the Concrete Aggregates that even cockcroaches could not pass through");
The union got wind of the motion only on May 4, 1992. The next day, May 5, 1992, it opposed the
motion, alleging:
xxx xxx xxx
They were never furnished by the petitioner with a copy of the original petition for
injunction filed on April 8, 1992 because as seen from the petition, petitioner
addressed the respondents at Rm. 205-206 Herald Bldg., Muralla St., Manila as
stated in paragraph 2 of the said petition and they came to know only of the same
when Commission issued a temporary restraining order dated April 15, 1992 which
was served to them at the picket line on April 15, 1992 and thus they opposed the
same on April 20, 1992 (pp. 99-100, Records).
. . . . The suspicion is that same is deliberate in order for the union not to be able to
immediately oppose the petition praying for a temporary restraining order and so
petitioner was scot-free when it presented ex-parte evidence. The motion for the
immediate issuance of a preliminary injunction foisted upon the Honorable
Commission with affidavits of employees debunked by cross-examination and
officers of the company making fantastic claims is an attempt to have lightning strike
twice at the same place. We hope this Honorable Commission is not fooled and
therefore we beseech it to examine carefully the pleadings and the transcript on this
question of threat or prohibited acts.
xxx xxx xxx
The allegation of damages if no injunction is secured is therefore premature and
irrelevant in this proceedings because there is no proof that the strike is illegal. For if
the strike is legal then both sides must bear their own losses in an economic contest:
the company loss of income; the workers loss of wages. These are the stakes
in an economic dispute. The desperate company posture to enjoin even the strike
itself is shown by its letter to the Secretary of Labor dated April 6, 1992, a copy of
which is hereto attached as Annex "A". The Secretary of Labor has not yet acted on
this request. The company believes probably that an injunction petition would
substitute the provision of Art. 263 of the Labor Code.
The same day, however, the respondent NLRC issued its disputed Order 7 granting the company's
motion for preliminary injunction. It reads:
It appears that despite the issuance of a temporary restraining order on April 14,
1991, the respondents have not ceased in committing the illegal acts being enjoined.
As shown by petitioner during the hearings of its main petition for preliminary and/or
permanent injunction, held on the first day of the implementation of the temporary
restraining order on April 20, 1992 and the day thereafter, respondents, thru the
formation of human blockade, have prevented the company vehicles and Employees'
Shuttle Buses from entering the company premises, and through forces and
intimidation made the non-striking employees on board the vehicles and buses to get
down: that even the company's Assistant Manager for Operations, Mr. Ronnie
Mercado, who tried to help the non-striking employees to enter the company
premises was blocked by the strikers and was even told "wala kaming pakialam sa
restraining order ninyo, basta hindi namin papapasukin para magtrabaho and sino
mang empleyado ng Concrete Aggregates. Bubugbugin namin kayo pag kayo
nagpilit." He was further told that "Ikaw Mercado huwag kang mapapel dito baka may
mangyari sa iyo." As a result of the said blockade, threats and intimidation, more or
less 100 non-striking employees now, have not been able to report for work;
moreover, the inability of the company's Longos Plant to operate fully had caused it
to lose the contracted RMC Sales of around 10,000 cubic meters worth around P10
million, not to mention the expected loss in sales for the next three (3) months at P14
million per month since no customers, regular or prospective, could transact
business with the company. But foremost of all, it has been shown that no less than
the President of the Union, Ramos Banas, with the support of the leaders of the
strikers, has threatened that upon the expiration of the validity of the temporary
restraining order on May 5, 1992, they will not only barricade the gates of the
company but even seal them all so that "even cockcroaches could not pass through."
While respondents witnesses, who were mentioned in the testimonies/affidavits of
petitioner's witnesses, tried to deny the illegal acts imputed against them, the fact
remains undisputed that when the convoy of the company cars and Employees
Shuttle Buses with reporting non-striking employees on board were about to enter
the compound of the company's Longos Plant in Quezon City, they were stopped by
the respondents on the lame excuse that they were only to inquire as to who those
on board and that they asked those who are allegedly non employees of the
petitioner to get down. It has been substantially established that out of the work force
of the Longos Plant, about 100 more or less employees have not been able to enter
the plant premises from April 20, 1991 up to the present, for fear of bodily harm from
the strikers. Likewise, if it were true, as claimed, that no threats and intimidation were
committed against the company officials who were to report for work, then there is no
reason why the Manager for Operations, Ronnie Mercado, should be complaining to
the police nearby and for the latter to advise respondents Ramon Banas and Ernest
Lascona behave well. Moreover, there is merit to the claim of petitioner that even
contract workers hired by it who, even before the strike and up to the present, were
assigned to work inside the premises of the Longos were denied entrance by the
strikers for their being alleged scabs. With this admission regarding the contract
worker, there is reason to believe the truth and veracity of the statement as of
petitioner's witnesses, especially the reasonable fear that after the lapse of the
twenty (20) days duration of the temporary restraining order, the respondents-strikers
will again resort to barricading the entrances of petitioner's plants to
preventanyone from entering the said plant's premises.
On the bases of all the foregoing facts and circumstances, the First Division of this
Commission, after due deliberation hereby RESOLVED: (pending conclusion of the
hearing on petitioner's main petition of April 24, 1991), to issue preliminary injunction:
a) enjoining the respondents, their representative and symphatizers, if any, without
prejudice to their right to conduct a peaceful and lawful picket, from preventing the
non-striking employees, officials of the company and their vehicles, customers and
visitors free ingress to and egress from petitioner's plant and premises; directing
them to make the ingress to and egress from said premises free from any and all
obstruction at all times; and requiring them to desist from further threatening and
intimidating at their houses or elsewhere the non-striking employees who up to now
could not report for work and to allow them to report for work unmolested; b) directing
them, despite the union president's statement that none of the feared illegal acts will
be committed after the lapse of the temporary restraining order, to refrain from doing
any illegal act which will exacerbate the situation upon the expiration of the
temporary restraining order; c) applying the cash or surety bond of P20,000.00
posted by petitioner for the temporary restraining order that will expire on May 5,
1992 as the case or surety bond for this preliminary injunction; d) deputizing any
officer from the Legal Division of this Commission to effectively enforce and
implement this injunctive order and, if necessary, to enlist the assistance of the PNP
or other peace officers having jurisdiction over the strike areas in the enforcement
and implementation of this Order.
Let two (2) copies of this injunctive order be posted in two (2) conspicuous places of
each of the strike areas by the Bailiff of this Commission for the information and
proper guidance of all concerned.
SO ORDERED.
The union then filed the instant petition for certiorari and mandamus raising the following issues:
xxx xxx xxx
3. Whether or not the respondent NLRC can issue a preliminary injunction, as it did
issue, after the lapse of a twenty day temporary restraining order without regard to
the specific provision of Article 218 (e) of the Labor Code, . . ., considering that in the
Order dated May 5, 1992 (attached as Annex "E" of this petition) there is no finding
of fact by the respondent NLRC in any of the five pages of the aforesaid Order, to the
effect that, as required by law, "(4) That complainant has no adequate remedy at law;
and (5) That the public officers charged with the duty to protect complainants
property are unable or unwilling to furnish adequate protection.
4. Whether or not public respondent NLRC and Labor Arbiter have unlawfully
neglected the performance of an act which the law enjoins as a duty resulting from
office considering that after petitioner also filed on April 24, 1992 a petition asking a
temporary restraining order and injunctionagainst the escorting by police authorities
of individuals "who seek to replace the strikers in entering or leaving the premises of
a strike area or work in the place of the strikers and that the police force will keep out
of the picket lines unless actual violence or other criminal acts occur therein" as
provided or Article 264 (d) of the Labor Code, considering that the Labor Arbiter
reluctantly allowed petitioners to present their evidence in support of their petition to
enjoin the scabs being escorted by the police; WHILE in contrast, it continuously set
the motion for immediate issuance of preliminary injunction of private respondents on
April 30, 1992, May 4 and 5, 1992 and issued a temporary restraining order in favor
of the respondent corporation in an hour.
We ordered the public and private respondents to comment on the petition. 8 In its 29-page Comment,
Solicitor General Raul I. Goco 9 took the position that the petition is impressed with merit. In contrast, the
private respondent company, defended the validity of the Order dated May 5, 1992 of the
NLRC. 10 Similarly, the NLRC contended that it did not abuse its discretion in issuing the disputed Order. 11
We find for the petitioners.
Strike has been considered the most effective weapon of labor in protecting the rights of employees
to improve the terms and conditions of their employment. It may be that in highly developed
countries, the significance of strike as a coercive weapon has shrunk in view of the preference for
more peaceful modes of settling labor disputes. In underdeveloped countries, however, where the
economic crunch continues to enfeeble the already marginalized working class, the importance of
the right to strike remains undiminished as indeed it has proved many a time as the only coercive
weapon that can correct abuses against labor. It remains as the great equalizer.
In the Philippine milieu where social justice remains more as a rhetoric than a reality, labor has
vigilantly fought to safeguard the sanctity of the right to strike. Its struggle to gain the right to strike
has not been easy and effortless. Labor's early exercise of the right to strike collided with the laws on
rebellion and sedition and sent its leaders languishing in prisons. The spectre of incarceration did not
spur its leaders to sloth; on the contrary it spiked labor to work for its legitimization. This effort was
enhanced by the flowering of liberal ideas in the United States which inevitably crossed our shores.
It was enormously boosted by the American occupation of our country. Hence, on June 17, 1953,
Congress gave statutory recognition to the right to strike when it enacted RA 875, otherwise known
as the Industrial Peace Act. For nearly two (2) decades, labor enjoyed the right to strike until it was
prohibited on September 12, 1972 upon the declaration of martial law in the country. The 14-year
battle to end martial rule produced many martyrs and foremost among them were the radicals of the
labor movement. It was not a mere happenstance, therefore, that after the final battle against martial
rule was fought at EDSA in 1986, the new government treated labor with a favored eye. Among
those chosen by then President Corazon C. Aquino to draft the 1987 Constitution were recognized
labor leaders like Eulogio Lerum, Jose D. Calderon, Blas D. Ople and Jaime S.L. Tadeo. These
delegates helped craft into the 1987 Constitution its Article XIII entitled Social Justice and Human
Rights. For the first time in
our constitutional history, the fundamental law of our land mandated the State to ". . . guarantee the
rights of all workers to self-organization, collective bargaining and negotiations, and peaceful
concerted activities, including the right to strike in accordance with law." 12 This constitutional
imprimatur given to the right to strike constitutes signal victory for labor. Our Constitutions of 1935 and
1973 did not accord constitutional status to the right to strike. Even the liberal US Federal Constitution did
not elevate the right to strike to a constitutional level. With a constitutional matrix, enactment of a law
implementing the right to strike was an inevitability. RA 6715 came into being on March 21, 1989, an
intentional replication of RA 875. 13 In light of the genesis of the right to strike, it ought to be obvious that
the right should be read with a libertarian latitude in favor of labor. In the wise words of Father Joaquin G.
Bernas, S.J., a distinguished commissioner of the 1987 Constitutional Commission " . . . the constitutional
recognition of the right to strike does serve as a reminder that injunctions, should be reduced to the barest
minimum". 14
In the case at bar, the records will show that the respondent NLRC failed to comply with the letter
and spirit of Article 218 (e), (4) and (5) of the Labor Code in issuing its Order of May 5, 1992. Article
218 (e) of the Labor Code provides both the procedural and substantive requirements which must
strictly be complied with before a temporary or permanent injunction can issue in a labor
dispute, viz.:
Art. 218. Powers of the Commission. The Commission shall have the power and
authority:
xxx xxx xxx
(e) To enjoin or restrain any actual or threatened commission of any or all prohibited
or unlawful acts or to require the performance of a particular act in any labor dispute
which, if not restrained or performed forthwith, may cause grave or irreparable
damage to any party or render ineffectual any decision in favor of such
party: Provided, That no temporary or permanent injunction in any case involving or
growing out of a labor dispute as defined in this Code shall be issued except after
hearing the testimony of witnesses, with opportunity for cross-examination, in support
of the allegations of a complaint made under oath, and testimony in opposition
thereto, if offered, and only after a finding of fact by the commission, to the effect:
(1) That prohibited or unlawful acts have been threatened and will be committed and
will be continued unless restrained but no injunction or temporary restraining order
shall be issued on account of any threat, prohibited or unlawful act, except against
the person or persons, association or organization making the threat or committing
the prohibited or unlawful act or actually authorizing or ratifying the same after actual
knowledge thereof;
(2) That substantial and irreparable injury to complainants property will follow;
(3) That as to each item of relief to be granted, greater injury will be inflicted upon
complainant by the denial of relief than will be inflicted upon defendants by the
granting of relief;
(4) That complainant has no adequate remedy at law; and
(5) That the public officers charged with the duty to protect complainants property
are unable or unwilling to furnish adequate protection.
Such hearing shall be held after due and personal notice thereof has been served, in
such manner as the Commission shall direct, to all known persons against whom
relief is sought, and also to the Chief Executive and other public officials of the
province or city within which the unlawful have been threatened or committed
charged with the duty to protect complainant's property: . . . (Emphasis ours)
In his Comment, the Solicitor General cited various evidence on record showing the failure of public
respondents to fulfill the requirements, especially of paragraphs four (4) and five (5) of the above
cited law. We quote with approval the pertinent portions of the Comment:
xxx xxx xxx
It must be noted that to support the claim of threats, intimidation, unlawful and
prohibited acts, etc. allegedly committed by the union against the non-striking
employees, the company even submitted a joint affidavit signed by Joselito
Concepcion, Renato Trambulo and Armando Arcos. Said affidavit reads
JOINT AFFIDAVIT
We ARMANDO ARCOS, CESAR NAVARRO and RENATO TRAMBULO residents of
Dasmarias, Cavite and JOSELITO CONCEPCION of Binangonan, Rizal all of legal
age, Filipino after having been sworn hereby depose and say:
That we are contract worker (sic) of CAC under Engr. Mercado;
That last April 20, 1992 at around 8:00 a.m. we were denied entry at the Longos
Plant by striking workers particularly Ramon Banas, Ricardo Manalang, Rodrigo
Manalang, Rodrigo Lauihon and Ernesto Lascona;
That the abovenamed persons stopped us at the gate of Longos Plant, told us to get
off the bus, and in threatening manner told us to leave and vacate the premises
otherwise something bad will happen to us;
That because of this unlawful, illegal and felonious acts of the said persons we were
compelled to do something against our will that is to leave without being able to
report for work;
That the abovenamed person and the herein complainants are residents of
barangays in different cities and municipalities hence the matter is not covered by PD
1508;
That we are executing this affidavit to charge Ramon Banas, Ricardo Manalang,
Rodrigo Lauihon and Ernesto Lascana with Grave Coercion. (Exh. "I", p. 896,
Records) (Emphasis Supplied).
However, when presented before the Labor Arbiter, the affiants themselves
controverted the allegations in said joint-affidavit. They innocently divulged having
signed the prepared affidavit without first reading the same. Likewise, they admitted
that they did not see or hear Banas, Manalang, Lacuna and Lacejon threatened the
group of "non-strikers" including themselves of bodily harm (pp. 13-14, 20-21, 35- 37,
46-47, 49-50, 54-61, TSN, April 24, 1992). They testified, thus
CROSS-EXAMINATION OF JOSELITO CONCEPCION
ARBITER PEALOSA:
The question is . . . who prepared the affidavit? Alam mo raw ba kung
sino ang gumawa ng affidavit na ito?
ATTY. ESPINAS:
Sinong gumawa?
ATTY. MACARUBBO:
Para sa iyo?
MR. CONCEPCION:
Si Attorney po. (pp. 20, 21, ibid)
DIRECT TESTIMONY OF RENATO TRAMBULO
ATTY. MACARUBBO:
Mr. Witness, did you sign an affidavit dated April 24,
1992?
MR. TRAMBULO:
Yes, Sir.
ATTY. MACARUBBO:
Have you read this affidavit?
MR. TRAMBULO:
Hindi pa ho.
xxx xxx xxx
ATTY. MACARUBBO:
Perhaps, what you meant is . . . .
ATTY. ESPINAS:
No, no, no, . . . You can ask another question. His answer is - Before
I, signed it but I have not read it yet.
ATTY. MACARUBBO:
What do you mean that you have not read this?
MR. TRAMBULO:
Sa akin lang po, iyong sinabi sa akin na . . . iyong hinarang kami,
pinababa kami . . . iyon lang po ang alam ko. Wala na po akong
ibang alam.
ATTY. MACARUBBO:
Hinarang ka?
MR. TRAMBULO:
Hinarang kami, pinababa kami dahil hindi daw kami empleyado sa
kompanya.
ATTY. MACARUBBO:
At iyon and ibig sabihin nito?
MR. TRAMBULO:
MR. WITNESS:
Personally I did not because I leave this police matter to my chief
security officer.
ATTY. ESPINAS:
Did your chief security officers ask the assistance of the policemen of
Quezon City with respect to the Longos Plant?
MR. WITNESS:
That I do not know.
ATTY. ESPINAS:
Did you ask the aid of the policemen at Bagumbayan, Quezon City to
help you regarding the incident of April 6, 1992 at 7:00 p.m.?
MR. WITNESS:
I did not personally because I instructed this police matter to my chief
security officer.
ATTY. ESPINAS:
Did your chief security officer seek the aid of the policemen?
MR. WITNESS:
That I do not know.
(pp. 41-43, TSN, April 30, 1992)
CROSS-EXAMINATION OF MR. MERCADO
ATTY. ESPINAS:
The policemen are from Quezon city.
MR. WITNESS:
I think so, kasi nagpa-patrol sila.
ATTY. ESPINAS:
And the security officer can request the aid of the policemen?
MR. WITNESS:
Yes.
(pp. 128-129, id)
Verily, the factual circumstances proven by the evidence show that there was no
concurrence of the five (5) prerequisites mandated by Art. 218 (e) of the Labor Code.
Thus there is no justification for the issuance of the questioned Order of preliminary
injunction.
The Comments of the private and public respondents did not dispute the correctness of these
documentary and testimonial evidence.
Moreover, the records reveal the continuing misuse of unfair strategies to secure ex parte temporary
restraining orders against striking employees. Petitioner union did not receive any copy of private
respondent's petition for injunction in Case No. 000249-92 filed on April 8, 1992. Its address as
alleged by the private respondent turned out to be "erroneous". 15 Consequently, the petitioner was
denied the right to attend the hearing held on April 13, 1992 while the private respondent enjoyed a field
day presenting its evidence ex parte. On the basis of uncontested evidence, the public respondent, on the
same day April 13, 1992, temporarily enjoined the petitioner from committing certain alleged illegal acts.
Again, a copy of the Order was sent to the wrong address of the petitioner. Knowledge of the Order came
to the petitioner only when its striking members read it after it was posted at the struck areas of the
private respondent.
To be sure, the issuance of an ex parte temporary restraining order in a labor dispute is not per
se prohibited. Its issuance, however, should be characterized by care and caution for the law
requires that it be clearly justified by considerations of extreme necessity, i.e., when the commission
of unlawful acts is causing substantial and irreparable injury to company properties and the company
is, for the moment, bereft of an adequate remedy at law. This is as it ought to be, for imprudently
issued temporary restraining orders can break the back of EMPLOYEES ENGAGED in a legal
strike. Often times, they unduly tilt the balance of a labor warfare in favor of capital. When that
happens, the deleterious effects of a wrongfully issued, ex parte temporary restraining order on the
rights of striking employees can no longer be repaired for they defy simple monetization. Moreover,
experience shows that ex parte applications for restraining orders are often based on fabricated
facts and concealed truths. A more becoming sense of fairness, therefore, demands that such ex
parte applications should be more minutely examined by hearing officers, lest, our constitutional
policy of protecting labor becomes nothing but a synthetic shibboleth. The immediate need to hear
and resolve these ex parte applications does not provide any excuse to lower our vigilance in
protecting labor against the issuance of indiscriminate injunctions. Stated otherwise, it behooves
hearing officers receiving evidence in support of ex parte injunctions against employees in strike to
take a more active stance in seeing to it that their right to social justice is in no way violated despite
their absence. This equalizing stance was not taken in the case at bar by the public respondents.
Nor do we find baseless the allegation by petitioner that the public respondents have neglected to
resolve with reasonable dispatch its own Petition for Injunction with prayer for a temporary
restraining order dated April 25, 1992. The petition invoked Article 264(d) of the Labor Code 16 to
enjoin the private respondent from using the military and police authorities to escort scabs at the struck
establishment. Sadly contrasting is the haste with which public respondent heard and acted on a similar
petition for injunction filed by the private respondent. In the case of the private respondent, its prayer for
an ex parte temporary restraining order was heard on April 13, 1992 and it was granted on the same day.
Its petition for preliminary injunction was filed on April 30, 1992, and was granted on May 5, 1992. In the
case of petitioner, its petition for injunction was filed on April 24, 1992, and to date, the records do not
reveal whether the public respondent has granted or denied the same. The disparate treatment is
inexplicable considering that the subject matters of their petition are of similar importance to the parties
and to the public.
IN VIEW WHEREOF, the petition for certiorari and mandamus is granted. The Order dated May 5,
1992 of the public respondent in NLRC NCR IC No. 000249-92 is annulled and set aside. The public
respondents are likewise ordered to hear and resolve, with deliberate speed petitioner's petition for
injunction filed on April 30, 1992.
SO ORDERED.
AZCUNA, J.:
Before us is a petition for certiorari and prohibition seeking to set aside the
decision of the Second Division of the National Labor Relations Commission
(NLRC) in Injunction Case No. 00468-94 dated November 29, 1994, and its
resolution dated February 1, 1995 denying petitioners motion for
reconsideration.
[1]
[2]
proceedings. The CBA also included a mutually enforceable no-strike nolockout agreement. The pertinent provisions of the said CBA are quoted
hereunder:
ARTICLE IV
GRIEVANCE MACHINERY
Section 1. - The parties hereto agree on the principle that all disputes between labor
and management may be solved through friendly negotiation;. . . that an open conflict
in any form involves losses to the parties, and that, therefore, every effort shall be
exerted to avoid such an open conflict. In furtherance of the foregoing principle, the
parties hereto have agreed to establish a procedure for the adjustment of grievances so
as to (1) provide an opportunity for discussion of any request or complaint and (2)
establish procedure for the processing and settlement of grievances.
xxx
xxx
xxx
ARTICLE V
ARBITRATION
Section 1. Any and all disputes, disagreements and controversies of any kind between
the COMPANY and the UNION and/or the workers involving or relating to wages,
hours of work, conditions of employment and/or employer-employee relations arising
during the effectivity of this Agreement or any renewal thereof, shall be settled by
arbitration through a Committee in accordance with the procedure established in this
Article. No dispute, disagreement or controversy which may be submitted to the
grievance procedure in Article IV shall be presented for arbitration until all the steps
of the grievance procedure are exhausted.
xxx
xxx
xxx
ARTICLE VI
Section 1. The UNION agrees that there shall be no strikes, walkouts, stoppage or
slowdown of work, boycotts, secondary boycotts, refusal to handle any merchandise,
picketing, sit-down strikes of any kind, sympathetic or general strikes, or any other
interference with any of the operations of the COMPANY during the term of this
Agreement.
Section 2. The COMPANY agrees that there shall be no lockout during the term of
this Agreement so long as the procedure outlined in Article IV hereof is followed by
the UNION.
[3]
On April 11, 1994, IBM, through its vice-president Alfredo Colomeda, filed
with the National Conciliation and Mediation Board (NCMB) a notice of strike,
docketed as NCMB-NCR-NS-04-180-94, against petitioner for allegedly
committing: (1) illegal dismissal of union members, (2) illegal transfer, (3)
violation of CBA, (4) contracting out of jobs being performed by union
members, (5) labor-only contracting, (6) harassment of union officers and
members, (7) non-recognition of duly-elected union officers, and (8) other acts
of unfair labor practice.
[4]
The next day, IBM filed another notice of strike, this time through its
president Edilberto Galvez, raising similar grounds: (1) illegal transfer, (2)
labor-only contracting, (3) violation of CBA, (4) dismissal of union officers and
members, and (5) other acts of unfair labor practice. This was docketed as
NCMB-NCR-NS-04-182-94.
[5]
[7]
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[11]
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A perusal of the records of the case clearly shows that the basic point to be resolved
entails the question of as to who between the two (2) groups shall represent the
workers for collective bargaining purposes, which has been the subject of a Petition
for Interpleader case pending resolution before the Office of the Secretary of Labor
and Employment. Similarly, the other issues raised which have been discussed by the
parties at the plant level, are ancillary issues to the main question, that is, the union
leadership... (Emphasis supplied)
[12]
Meanwhile, on May 23, 1994, the Galvez group filed its second notice of
strike against petitioner, docketed as NCMB-NCR-NS-05-263-94. Additional
[14]
On May 27, 1994, the Colomeda group notified the NCMB of the results of
their strike vote, which favored the holding of a strike. In reply, NCMB issued
a letter again advising them that by virtue of the PAL v. Drilon ruling, their
notice of strike is deemed not to have been filed, consequently invalidating
any subsequent strike for lack of compliance with the notice requirement.
Despite this and the pendency of the preventive mediation proceedings, on
June 4, 1994, IBM went on strike. The strike paralyzed the operations of
petitioner, causing it losses allegedly worth P29.98 million in daily lost
production.
[15]
[16]
[17]
Two days after the declaration of strike, or on June 6, 1994, petitioner filed
with public respondent NLRC an amended Petition for Injunction with Prayer
for the Issuance of Temporary Restraining Order, Free Ingress and Egress
Order and Deputization Order. After due hearing and ocular inspection, the
NLRC on June 13, 1994 resolved to issue a temporary restraining order
(TRO) directing free ingress to and egress from petitioners plants, without
prejudice to the unions right to peaceful picketing and continuous hearings on
the injunction case.
[18]
[19]
[22]
[24]
[27]
[30]
[32]
[33]
[34]
The NCMB had declared the notice of strike as appropriate for preventive
mediation. The effect of that declaration (which PALEA did not ask to be
reconsidered or set aside) was to drop the case from the docket of notice of strikes, as
provided in Rule 41 of the NCMB Rules, as if there was no notice of strike. During
the pendency of preventive mediation proceedings no strike could be legally
declared... The strike which the union mounted, while preventive mediation
proceedings were ongoing, was aptly described by the petitioner as an ambush.
(Emphasis supplied)
Clearly, therefore, applying the aforecited ruling to the case at bar, when
the NCMB ordered the preventive mediation on May 2, 1994, respondent had
thereupon lost the notices of strike it had filed. Subsequently, however, it still
defiantly proceeded with the strike while mediation was ongoing, and
notwithstanding the letter-advisories of NCMB warning it of its lack of notice of
strike. In the case of NUWHRAIN v. NLRC, where the petitioner-union
therein similarly defied a prohibition by the NCMB, we said:
[35]
Petitioners should have complied with the prohibition to strike ordered by the NCMB
when the latter dismissed the notices of strike after finding that the alleged acts of
discrimination of the hotel were not ULP, hence not strikeable. The refusal of the
petitioners to heed said proscription of the NCMB is reflective of bad faith.
have granted the injunctive relief to prevent the grave damage brought about
by the unlawful strike.
Also noteworthy is public respondents disregard of petitioners argument
pointing out the unions failure to observe the CBA provisions on grievance
and arbitration. In the case of San Miguel Corp. v. NLRC, we ruled that the
union therein violated the mandatory provisions of the CBA when it filed a
notice of strike without availing of the remedies prescribed therein. Thus we
held:
[40]
x x x For failing to exhaust all steps in the grievance machinery and arbitration
proceedings provided in the Collective Bargaining Agreement, the notice of strike
should have been dismissed by the NLRC and private respondent union ordered to
proceed with the grievance and arbitration proceedings. In the case of Liberal Labor
Union vs. Phil. Can Co., the court declared as illegal the strike staged by the union for
not complying with the grievance procedure provided in the collective bargaining
agreement. . . (Citations omitted)
As in the abovecited case, petitioner herein evinced its willingness to
negotiate with the union by seeking for an order from the NLRC to compel
observance of the grievance and arbitration proceedings. Respondent
however resorted to force without exhausting all available means within its
reach. Such infringement of the aforecited CBA provisions constitutes further
justification for the issuance of an injunction against the strike. As we said long
ago: Strikes held in violation of the terms contained in a collective bargaining
agreement are illegal especially when they provide for conclusive arbitration
clauses. These agreements must be strictly adhered to and respected if their
ends have to be achieved.
[41]
[44]