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LABOR RELATIONS

2011 NLRC RULES OF PROCEDURE

RULE I TITLE AND CONSTRUCTION

Liberally construed to carry out the objectives of the Constitution, the Labor
Code of the Philippines and other relevant legislations, and to assist the
parties in obtaining just, expeditious and inexpensive resolution and
settlement of labor disputes (Section 2)

RULE II DEFINITION OF TERMS

Same definitions as Art. 212 of the Labor Code (Section 1)

Article 212. Definitions.

(a) Commission means the National Labor Relations Commission or any of its
divisions, as the case may be, as provided under this Code.
(b) Bureau means the Bureau of Labor Relations and/or the Labor Relations
Divisions in the regional offices established under PD No. 1, in the
Department of Labor.
(c) Board means the National Conciliation and Mediation Board established
under EO No. 126.
(d) Council means the Tripartite Voluntary Artibtration Advisory Council
established under EO No. 126, as amended.
(e) Employer includes any person acting in the interest of an employer, directly
or indirectly. The term shall not include any labor organization or any of its
officers or agents except when acting as employer.
(f) Employee includes any person in the employ of an employer. The term
shall not be limited to the employees of a particular employer, unless this
Code so explicitly states. It shall include any individual whose work has
ceased as a result of or in connection with any current labor dispute or
because of any unfair labor practice if he has not obtained any other
substantially equivalent and regular employment.
(g) Labor organization means any union or association of employees which
exists in whole or in part for the purpose of collective bargaining or of dealing
with employers concerning terms and conditions of employment.
(h) Legitimate labor organization means any labor organization duly registered
with the Department of Labor and Employment, and includes any branch or
local thereof.
(i) Company union means any labor organization whose formation, function or
administration has been assisted by any act defined as unfair labor practice
by this Code.
(j) Bargaining representative means a legitimate labor organization or any
officer or agent of such organization whether or not employed by the
employer.
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(k) Unfair labor practice means any unfair labor practice as expressly defined
by this Code.
(l) Labor dispute 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
proximate relation of employer and employee.
(m) Managerial employee is one who is vested with powers or
prerogatives to lay down and execute management policies and/or hire,
transfer, suspend, layoff, recall, discharge, assign, or discipline employees.
Supervisory employees are those who, in the interest of the employer,
effectively recommend such managerial actions if the exercise of such
authority is not merely routinary or clerical in nature but requires the use of
independent judgment. All employees not falling within any of the above
definitions are considered rank-and-file employees for purposes of this Book.
(n) Voluntary Arbitrator means any person accredited by the Board as such, or
any person named or designated in the Collective Bargaining Agreement by
the parties to act as their voluntary arbitrator, or one chosen, with or without
the assistance of the National Conciliation and Mediation Board, pursuant to
a selection procedure agreed upon in the Collective Bargaining Agreement,
or any official that may be authorized by the Secretary of Labor and
Employment to act as voluntary arbitrator upon the written request and
agreement of the parties to a labor dispute.
(o) Strike means any temporary stoppage of work by the concerted action of
employees as a result of an industrial or labor dispute.
(p) Lockout means the temporary refusal of an employer to furnish work as a
result of an industrial or labor dispute.
(q) Internal union dispute includes all disputes or grievances arising from any
violation of or disagreement over any provision of the constitution and
bylaws of a union, including any violation of the rights and conditions of
union membership provided for in this Code.
(r) Strike breaker means any person who obstructs, impedes, or interferes
with by force, violence, coercion, threats, or intimidation any peaceful
picketing by employees during any labor controversy affecting wages, hours
or conditions of work or in the exercise of the right of self-organization or
collective bargaining.
(s) Strike area means the establishment, warehouses, depots, plants or
offices, including the sites or premises used as runaway shops, of the
employer struck against, as well as the immediate vicinity actually used by
picketing strikers in moving to and fro before all points of entrance to and
exit from said establishment.
Regional Arbitration Branch (RAB) any of the regional arbitration branches
or sub-regional branches of the Commission

RULE III PLEADINGS, NOTICES, AND APPEARANCES


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Initiatory pleading: Complaint should contain (Section 1a)
o Cause/Causes of Action
o Names and Addresses of ALL Complainants/Petitioners and Respondents
o Signed under Oath by Complainant/Petitioner
o Declaration of Non-Forum Shopping
GENERAL RULE: Mandatory in initial pleading
But not necessarily jurisdictional; SC has decided in some cases to let
slide non-compliance with this rule in the interest of justice
Appeals: not necessary anymore, pursuant to the concept that an
appeal is not an initiatory pleading
Forum Shopping: The practice of choosing the most favorable
jurisdiction or court in which a claim might be heard. (Blacks Law
Dictionary) The practice of choosing the court in which to bring an
action from among those courts that could properly exercise
jurisdiction based on a determination of which court is likely to provide
the most favorable outcome. (Merriam-Websters Dictionary of Law)
Exists when a party who obtains an unfavorable decision from one
forum seeks a favorable decision from another forum. (Comm.
Ortiguerra)

MANDAUE GALLEON TRADE v. BIENVENIDO ISIDTO (GR 181057, 5 July 2010)


Nachura

Facts: Mandaue Galleon Trade was sued by its former employees for illegal dismissal
before the LA. The LA decided in favor of the employees and ordered Mandaue
Galleon Trade to pay the complainants the sum of P917,700.00. Mandaue Galleon
Trade filed an appeal before the NLRC but failed to attach a certification of non-
forum shopping to their notice of appeal, as required by Section 4, Rule VI of the
2005 NLRC Rules of Procedure. The NLRC dismissed Mandaue Galleon Trades
appeal for being fatally defective, and the LAs decision was affirmed in toto with
finality. An entry of judgment was then issued by the NLRC, stating that its decision
had already become final and executory.

Mandaue Galleon Trade then filed a petition for certiorari before the CA. The
CA dismissed the same. Mandaue Galleon Trade then filed another petition for
certiorari before the SC, stating that the CA committed grave abuse of discretion in
denying its appeal on mere technicality.

Issue: W/N the CA committed a grave and reversible error in affirming the decision
of the NLRC denying Mandaue Galleon Trades appeal on mere technicality despite
the existence of a meritorious case.

Ruling: NO. Based on Section 4(a), Rule VI of the [2005] NLRC Rules of
Procedure, a certificate of non-forum shopping is a requisite for the perfection of an
appeal, and non-compliance therewith shall not stop the running of the period for
perfecting an appeal. The filing of a certificate of non-forum shopping is mandatory
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in initiatory pleadings. The subsequent compliance with the requirement does not
excuse a partys failure to comply therewith in the first instance. In those cases
where the SC excused non-compliance with the requirement to submit a certificate
of non-forum shopping pursuant to Administrative Circular No. 04-94, it found
special circumstances or compelling reasons which made the strict application
thereof clearly unjustified or inequitable. In this case, however, Mandaue Galleon
Trade offered no valid justification for their failure to comply with the Circular.

While it is true that litigation is not a game of mere technicalities and that
rules of procedure shall not be strictly enforced at the cost of substantial justice, it
does not mean that the Rules of Court may be ignored at will and at random to the
prejudice of orderly presentation and assessment of the issues and their just
resolution. It must be emphasized that procedural rules should not be belittled or
dismissed simply because their non-observance might have resulted in prejudice to
a partys substantial rights. Like all rules, they are required to be followed, except
only for the most persuasive of all reasons.

Petition denied, CA decision affirmed.

Notes and Doctrines:

It has been previously ruled that non-compliance with the required


certification is fatal. The filing of the same is not waived by failing to immediately
assert the defect, and neither is it cured by its belated submission on the ground
that the party was not in any way guilty of actual forum shopping.

Guidelines based on jurisprudential pronouncements respecting non-


compliance with the requirements on, or submission of defective verification and
certification against forum shopping:

(1) A distinction must be made between non-compliance with the requirement on


or submission of defective verification, and non-compliance with the
requirement on or submission of defective certification against forum
shopping.
(2) As to verification, non-compliance therewith or a defect therein does not
necessarily render the pleading fatally defective. The court may order its
submission or correction or act on the pleading if the attending circumstances
are such that strict compliance with the Rule may be dispensed with in order
that the ends of justice may be served thereby.
(3) Verification is deemed substantially complied with when one who has ample
knowledge to swear to the truth of the allegations in the complaint or petition
signs the verification, and when matters alleged in the petition have been
made in good faith or are true and correct.
(4) As to certification against forum shopping, non-compliance therewith or a
defect therein, unlike in verification, is generally not curable by its
subsequent submission or correction thereof, unless there is a need to relax
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the Rule on the ground of substantial compliance or presence of special
circumstances or compelling reasons.

Administrative Circular 28-91 (1994): Requires that every petition filed with
the SC or the CA must be accompanied by a certificate of non-forum shopping

Administrative Circular 04-94 (1994): Expanded the certification requirement


to include cases filed in court and in quasi-judicial agencies; Ordains that a violation
of the rule on non-forum shopping would constitute contempt of court and be a
cause for the summary dismissal of the petition, without prejudice to the taking of
appropriate action against the counsel of the party concerned

FARLEY FULACHE v. ABS-CBN BROADCASTING CORPORATION (GR No. 183810, 21


January 2010) Brion

Facts: Several persons filed separate complaints for regularization, unfair labor
practice, and several money claims against ABS-CBN Cebu for being allegedly
excluded from the CBA coverage because they were considered by the company as
temporary employees. ABS-CBN argued that they were only contractual employees
who were paid talent fees, whose services are engaged for a specific program or
production, or a segment thereof, and whose said contracts are terminated once the
program, production, or segment is completed. The LA rendered its decision in favor
of the complainants, holding that they were already regular employees of ABS-CBN,
not independent contractors, and are entitled to the benefits and privileges of
regular employees. ABS-CBN then appealed the case to the NLRC, still contending
that the complainants were independent contractors and not regular employees.

While the case was on appeal with the NLRC, ABS-CBN dismissed the
complainants for their refusal to sign up contracts of employment with their service
contractor. The dismissed complainants filed another complaint for illegal dismissal
which was handled by the same LA who handled the previous regularization case.
The LA upheld the validity of the dismissal of the complainants due to redundancy,
an authorized cause under the law. The complainants were then awarded separation
pay. ABS-CBN then appealed the illegal dismissal case to the NLRC, which rendered
a joint decision on both the regularization and illegal dismissal cases. It affirmed the
LA decision with respect to regularization, additionally granting the complainants
CBA benefits and privileges, and reversed the LA with respect to the illegal
dismissal case. Both ABS-CBN and complainants moved for reconsideration, and the
NLRC resolved both motions for reconsideration by reinstating the two separate
decisions of the LA with respect to regularization and illegal dismissal. The NLRC
denied complainants second motion for reconsideration for being a prohibited
pleading. The complainants then went to the CA through a petition for certiorari
under Rule 65 of the Rules of Court. The CA upheld the NLRC decisions.

Issue: W/N the dismissal of the complainants by ABS-CBN is tainted with bad faith.

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Ruling: YES. The termination of employment of the complainants occurred
under highly questionable circumstances and with plain and unadulterated bad
faith. The records show that the regularization case was in fact the root of the
resulting bad faith as this case gave rise and led to the dismissal case. ABS-CBN
apparently forgot that there was a standing LA decision that, while not yet final
because of its own pending appeal, cannot simply be disregarded. By implementing
the dismissal action at the time the LAs ruling was under review, the company
unilaterally negated the effects of the LAs ruling while at the same time appealing
the same ruling to the NLRC. This unilateral move is a direct affront to the NLRCs
authority and an abuse of the appeal process.

A close parallel that can be drawn to characterize this bad faith is the
prohibition against forum-shopping under the Rules of Court. In forum-shopping, the
Rules characterize as bad faith the act of filing similar and repetitive actions for the
same cause with the intent of somehow finding a favorable ruling in one of the
actions filed. ABS-CBNs actions in the two cases are of the same character, since its
obvious intent was to defeat and render useless, in a roundabout way and other
than through the appeal it had taken, the LAs decision in the regularization case.
Forum-shopping is penalized by the dismissal of the actions involved. The penalty
against ABS-CBN for its bad faith in the present case should be no less.

Petition granted.

No pleading shall be considered without proof of service to the opposing


parties except if filed simultaneously during a schedule set before the Labor
Arbiter (Section 3b)
For purposes of appeal, the period shall be counted from receipt of such
decisions, resolutions, or orders by the counsel or representative of record
(Section 4b, par. 2)
Return is a prima facie proof of the facts indicated therein; service by
registered mail or by private courier is complete upon receipt by the
addressee or his/her agent (Section 5)
A non-lawyer may appear in any of the proceedings before the Labor Arbiter
BUT ONLY UNDER THE FOLLOWING CONDITIONS (Section 6b)
o He/she represents himself/herself as party to the case (Section 6b(1));
o He/she represents a legitimate labor organization, as defined under
Articles 212 and 242 of the Labor Code, as amended, which is a party to
the case: Provided, that he/she presents to the Commission or Labor
Arbiter during the mandatory conference or initial hearing: (i) A
certification from the Bureau of Labor Relations or Regional Office of the
Department of Labor and Employment attesting that the organization
he/she represents is duly registered and listed in the roster of legitimate
labor organizations; (ii) A verified certification issued by the secretary and
attested to by the president of the said organization stating that he/she is

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authorized to represent the said organization in the said case; and (iii) A
copy of the resolution of the board of directors of the said organization
granting him such authority (Section 6b(2));
o He/she represents a member or members of a legitimate labor
organization that is existing within the employers establishment, who are
parties to the case: Provided, that he/she presents: (i) A verified
certification attesting that he/she is authorized by such member or
members to represent them in the case; and (ii) A verified certification
issued by the secretary and attested to by the president of the said
organization stating that the person or persons he/she is representing are
members of their organization, which is existing in the employers
establishment (Section 6b(3));
o He/she is a duly-accredited member of any legal aid office recognized by
the Department of Justice or Integrated Bar of the Philippines: Provided,
that he/she (i) Presents proof of his/her accreditation; and (ii) Represents a
party to the case (Section 6b(4));
o He/she is the owner or president of a corporation or establishment which
is a party to the case: Provided, that he/she presents: (i) A verified
certification attesting that he/she is authorized to represent said
corporation or establishment; and (ii) A copy of the resolution of the board
of directors of said corporation, or other similar resolution or instrument
issued by said establishment, granting him/her such authority (Section
6b(5)).
Counsel cannot, without special power of attorney or express consent, enter
into a compromise agreement with the opposing party in full or partial
discharge of a clients claim (Section 7)

RULE IV VENUE, ASSIGNMENT AND DISPOSITION OF CASES AT THE REGIONAL


ARBITRATION BRANCH

Venue: RAB having jurisdiction over the workplace of complainant/petitioner


(Section 1a)
o Workplace: The place or locality where the employee is regularly assigned
at the time the cause of action arose; shall include the place where the
employee is supposed to report back after a temporary detail,
assignment, or travel
o Field Employees, Ambulant, or Itinerant Workers: Workplace is where they
are regularly assigned, or where they are supposed to regularly receive
their salaries and wages or work instructions from, and report the results
of their assignment to, their employers
When venue is not objected to before the filing of position papers, such issue
shall be deemed waived (Section 1c)
The venue of an action may be changed or transferred to a different RAB
other than where the complaint was filed by written agreement of the parties

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or when the Commission or Labor Arbiter before whom the case is pending so
orders, upon motion by the proper party in meritorious cases (Section 1d)
Cases involving OFWs may be filed before the RAB having jurisdiction over
the place where the complainant/petitioner resides or where the principal
office or any of the respondents is situated, at the option of the
complainant/petitioner (Section 1e)
Where there are two or more cases or complaints pending before different
LAs in the same RAB involving the same employer and common principal
causes of action, or the same parties with different causes of action, the
subsequent cases or complaints shall be consolidated with the first to avoid
unnecessary costs or delay (Section 3)
o In case of objection to the consolidation, the same shall be resolved by the
Executive Labor Arbiter. An order resolving a motion or objection to
consolidation shall be inappealable. (Section 3, par. 2)
When the Secretary of Labor and Employment has assumed jurisdiction over
a strike or lockout or certified the same to the Commission, the parties to
such dispute shall immediately inform the Secretary or the Commission, as
the case may be, of all cases directly related to the dispute between them
pending before any RAB, and the LA handling the same of such assumption or
certification. The LA concerned shall forward within 2 days from notice the
entire records of the case to the Commission or to the Secretary of Labor, as
the case may be, for proper disposition. (Section 4, par. 2)

RULE V PROCEEDINGS BEFORE LABOR ARBITERS

Jurisdiction of LA: original and exclusive (Section 1; Article 217 of the Labor
Code)
o Unfair labor practices (Section 1a; Article 217a(1))
o Termination disputes (Section 1b; Article 217a(2))
Companies with CBA not exclusively under LA; shared jurisdiction
between LA and VA
Constitutional bias in favor of voluntary arbitration even if there have
already been proceedings with the labor arbiter, the same can at
anytime be transferred with the voluntary arbitrator
o If accompanied with a claim for reinstatement, those cases that workers
may file involving wages, rates of pay, hours of work, and other terms and
conditions of employment (Section 1c; Article 217a(3))
o Claims for actual, moral, exemplary, and other forms of damages arising
from employer-employee relations (Section 1d; Article 217a(4))
o Cases arising from any violation of Article 264 of the Labor Code, as
amended, including questions involving the legality of strikes and lockouts
(Section 1e; Article 217a(5))
o Except claims for employees compensation not included in the next
succeeding paragraph, social security, medicare, and maternity benefits,
all other claims arising from employer-employee relations, including those
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of persons in domestic or household service, involving an amount
exceeding P5,000.00, whether or not accompanied with a claim for
reinstatement (Section 1f; Article 217a(6))
o Wage distortion disputes in unorganized establishments not voluntarily
settled by the parties pursuant to Republic Act No. 6727 (Section 1g)
If the wage distortion is caused by a CBA, it is not actionable
o Enforcement of compromise agreements when there is non-compliance by
any of the parties pursuant to Article 227 of the Labor Code, as amended
(Section 1h)
LA has no power to review, amend, or critique compromise
agreements; they can only order enforcement
o Money claims arising out of employer-employee relationship or by virtue
of any law or contract, involving Filipino workers for overseas deployment,
including claims for actual, moral, exemplary, and other forms of damages
as provided by Section 10 of RA 8042, as amended by RA 10022 (Section
1i)
o Other cases as may be provided by law (Section 1j)

DEPARTMENT ORDER NO. 107-10, Series of 2010: GUIDELINES ON THE SINGLE


ENTRY APPROACH PRESCRIBING A 30-DAY MANDATORY CONCILIATION-MEDIATION
SERVICES FOR ALL LABOR AND EMPLOYMENT CASES

Single Entry Approach (SEnA)(Section 3a) an administrative approach to provide a


speedy, impartial, inexpensive, and accessible settlement procedure of all labor
issues or conflicts to prevent them from ripening into full blown disputes; uses the
conciliation-mediation process as immediate intervention to effect amicable
settlement among differing parties

Coverage (Section 2): Cases falling under the administrative and quasi-judicial
functions of all DOLE offices and attached agencies including the NLRC except:

1) Notices of strikes and lockouts, or preventive mediation cases which shall


remain with the National Conciliation and Mediation Board (NCMB); and
2) Issues arising from the interpretation or implementation of the collective
bargaining agreement and those arising from interpretation or enforcement
of company personnel policies which should be processed through the
Grievance Machinery

Single Entry Assistance Desk Officer (Section 3b) person designated to provide
assessment, evaluation, and counseling services before the filing of any labor
complaint or dispute

Who may file request for assistance (Section 4) any aggrieved worker, union,
group of workers, or the employer

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Where request for assistance may be filed (Section 5) any SEAD in the region
where the employer principally operates; in case of a union or federation
representing a local chapter, the request shall be made at the
regional/provincial/district office where the union or local chapter is registered

Issues subject of the 30-day mandatory conciliation-mediation (Section 6):

a) Termination or suspension of employment issues;


b) Claims for any sum of money, regardless of amount;
c) Intra-union and inter-union issues, after exhaustion of administrative
remedies;
d) Unfair labor practice;
e) Closures, retrenchments, redundancies, temporary lay-offs;
f) OFW cases; and
g) Any other claims arising from employer-employee relationship

Upon receipt of the complaint or request for conciliation-mediation services, the


designated Desk Officer shall initiate a pre-conference assessment, evaluation,
counseling, and conciliation-mediation services (Section 8)

Conduct of conciliation-mediation (Section 9): In facilitating the conciliation


meeting, the Desk Officer shall:

a) Clarify the issues and narrow down the disagreements;


b) Validate the positions and the relief sought;
c) Encourage parties to generate options and enter into stipulations;
d) Offer proposals and options toward mutually acceptable solutions and
voluntary settlement.

Unless the parties agree otherwise, conciliation-mediation shall be carried out and
terminated within the prescribed 30-day period. The parties are required to appear
at all times. Lawyers may be allowed to join the conference only to render advice to
parties. (Section 12, pars. 1 and 2)

In case of voluntary settlement, the Desk Officer shall reduce the agreement into
writing, have the parties understand the contents thereof, sign the same in his/her
presence, and attest the document to be the true and voluntary act of the parties.
Any settlement agreement reached by the parties before the Desk Officer shall be
final and binding. (Section 10)

In case of partial settlement and/or partial execution of certain issues, all


unresolved issues shall be referred before the DOLE office or agency having
jurisdiction over the dispute, without prejudice to amendments on the complaint by
the parties. (Section 10, par. 2 in relation to Section 15) Failure of the complaining
party to appear in two scheduled meetings shall also result in the issuance of a
referral to the appropriate office or agency that has jurisdiction over the dispute.
(Section 12, par. 3) In case of non-appearance of the employer or the party

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complained of despite due notice, the complaining party may request for the
issuance of the referral or for a re-setting of the conciliation-mediation conference
at any day within the 30-day period. (Section 12, par. 4) Any or both parties, within
the 30-day period, may pre-terminate the proceedings and request referral to the
appropriate office or agency which has jurisdiction over the dispute, or, if both
parties so agree, refer the unresolved issues to voluntary arbitration. (Section 13)

Referral (Section 3d) the document issued by the Desk Officer referring the
unresolved issue/s to the appropriate DOLE office or agency that has jurisdiction
over the dispute.

The Desk Officer shall monitor the voluntary and faithful compliance with the
settlement agreement by causing the parties to make a report of compliance or
non-compliance within two weeks from the date of agreement or agreed period of
compliance. Failure of the parties to make a report within the prescribed period
shall render the said agreement deemed duly complied with absent proof to the
contrary. (Section 11, par. 1)

In case of non-compliance by the other party, the agreement shall be endorsed by


the Desk Officer to the NLRC for enforcement. (Section 11, par. 2)

In case of failure to reach an agreement within the 30-day mandatory conciliation


period, the Desk Officer shall issue a referral to the appropriate DOLE office or
agency which has jurisdiction over the dispute, or if both parties so agree, refer the
unresolved parties to voluntary arbitration. (Section 14)

In instances provided in Sections 12 and 14, the issuance of the referral on the date
of termination of the conciliation-mediation services shall be motu proprio;
otherwise, upon request of any or both parties to the proceedings. Failure of the
Desk Officer to observe the period to issue the referral shall be dealt with
accordingly as an administrative offense. (Section 16)

Information and statements given in confidence at the conciliation-mediation


proceedings shall be treated as privileged communication and shall not be used as
evidence in any arbitration proceedings, except the stipulation of facts voluntarily
entered into by the parties. The Desk Officer shall not be required to testify in any
court or body regarding any confidential matter and information taken during the
conciliation proceedings conducted by them. (Section 17)

NOTES:

SEnA does not take into account the original and exlusive jurisdiction of the
different agencies.

After the SEADO refers a case to the NLRC, the complainant still needs to
accomplish a complaint to allow the NLRC to send out summonses, so that

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jurisdiction over the person of the party shall be acquired. Complainant need not be
sent summons; NLRC acquires jurisdiction at the time of the filing of the complaint.
Only the respondent/s need to be summoned.

Cases arising from the interpretation or implementation of CBAs and those


arising from the interpretation or enforcement of company personnel policies
shall be disposed of by the LA by referring the same to the grievance
machinery and voluntary arbitration, as may be provided in said agreements
(Section 1, par. 2)
MOST IMPORTANT CONDITION: existence of employer-employee relationship,
with the exception of OFWs pursuant to RA 8042, as amended by RA 10022
LA has no jurisdiction over intra-corporate controversies; RTC is the correct
forum

RURAL BANK OF CORON v. ANNALISA CORTES (GR No. 164888, 6 December 2006)
Carpio Morales

Facts: Annalisa Cortes was hired as the Corporate Secretary and Personnel Officer of
the Rural Bank of Coron, and a Personnel Officer of both Empire Cold Storage and
Development Corporation, and Citizens Development Incorporated, firms which
were practically financially controlled by her sister-in-law, Anita Cortes-Garcia. Upon
inspection of the books of the said corporations where Annalisa was hired as a
personnel officer, it was discovered that the latter was involved in several
anomalies, prompting them to terminate her services from the corporations.
Annalisa stated her willingness to abide by the decision regarding her termination
but stressed her right to separation pay. When her demand went unheeded, she
filed a complaint for illegal dismissal and non-payment of salaries and other
benefits. The petitioners moved for the dismissal of the complaint on the ground
that it was an intra-corporate controversy involving the removal of a corporate
officer. The LA found that Annalisa was not a corporate officer, and thus the case
falls within the ambit of the jurisdiction of the LA.

Issue: W/N Cortes is a corporate officer of the said corporations.

Ruling: NO. While, indeed, Cortes was the Corporate Secretary of the Rural
Bank of Coron, she was also its Financial Assistant and the Personnel Officer of the
two other petitioner corporations. Jurisprudence instructs that a corporation can
engage its corporate officers to perform services under a circumstance which would
make them employees. The Labor Arbiter has thus jurisdiction over Cortes
complaint.

LA has NO INJUNCTIVE POWER


Nature of proceedings: NON-LITIGIOUS (Section 2)

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o Subject to the requirements of due process, the technicalities of law and
procedure and the rules obtaining in the courts of law shall not strictly
apply thereto
o The LA may avail himself or herself of all reasonable means to ascertain
the facts of the controversy speedily, including ocular inspection and
examination of well-informed persons
Manner of service of summons (Section 4):
o Personally
By the bailiff or a duly authorized public officer within 3 days from
his/her receipt thereof
o Registered Mail
Made by Philpost Corporation
Enjoys presumption of regularity in performance of official functions
For purposes of appeal: the date of mailing will be deemed as the
date of filing
o Private Courier
Must be authorized by the Commission
Required to accomplish a special undertaking, and if the special courier
does not comply with the said undertaking, they may be blacklisted
Does not enjoy the presumption of regularity in performance of official
functions
For purposes of appeal: the date of actual receipt will be deemed as
the date of filing
Prohibited Pleadings and Motions (Section 5)
o Motion to dismiss the complaint except on the ground of lack of
jurisdiction over the subject matter, improper venue, res judicata,
prescription, and forum shopping (Section 5a)

Notes on Jurisdiction:

When one says that the NLRC has no jurisdiction, what particular point is one
focusing on? Lack of employer-employee relationship.

Corporate disputes are cognizable by the regular courts.

Personnel of international agenciessuch as World Health Organization,


International Labor Organization, International Catholic Migration Commissionare
IMMUNE FROM SUIT. Why are employees of international agencies immune from suit
not allowed by the Labor Code to pursue their claims before the labor tribunals?
RESEARCH: POLITICAL LAW.

Q: A complainant was dismissed by his employer. He does not challenge his


dismissal. Instead, he claims non-payment of his 13 th month pay in the amount of
P3,500.00. Who has jurisdiction over his case?

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MACAPAGAL, STEPHANIE LUZETTE M. BSU COLLEGE OF LAW
A: LA, because there is no more employer-employee relationship. The RDs
jurisdiction can only be invoked when there is employer-employee relationship.

Q: Complainant filed a complaint for labor standards violations. Labor standards


violation amounted to P1.5M. The complaint was prompted by a routine inspection
conducted in the company. The RD issued a compliance order. Before the
compliance order can be enforced, the employer-employee relationship was
severed. So the management filed a motion to dismiss alleging that the RD has lost
jurisdiction over the case inasmuch as there is a severance of employer-employee
relationship. Is management correct?

A: NO. Once jurisdiction has attached, it cannot be lost.

o Motion for a bill of particulars (Section 5b)


No violation of procedural due process
Take note that we have the SEnA; should there be no settlement during
the SEnA, there is a mandatory conference conducted by the LArules
of procedure speaks of 2 mandatory conferences wherein there are
stipulations of facts which are recorded, thus providing the respondent
with all the details and specificity that he needs
o Motion for new trial (Section 5c)

Q: Respondent received a copy of the summons. Instead of appearing, the


respondent indorsed the same to a lawyer. The lawyer did not appear.
Consequently, an ex parte decision was rendered. Respondent filed a motion for
new trial. If you were the LA, would you grant that motion?

A: NO. A motion for new trial is clearly a prohibited pleading. Proceedings before
the NLRC and before all labor tribunals are not bound by the strict rules of
procedure and technicalities.

o Petition for relief from judgment (Section 5d)


However, may be considered as an appeal when all the requirements
for the perfection of an appeal have been complied with

Q: A decision had already been rendered by the LA. The respondent filed a
petition for relief from judgment on the ground that there was no summons issued
to him. The records do not show that he had been given the opportunity to be
heard; worse, there is no showing on record that jurisdiction over his person had
been acquired. Is he correct?

A: NO. If respondent really had not been served with summons, his recourse is
to file a petition for extraordinary remedies (Rule XII), pray for the issuance of a
temporary restraining order, or a permanent injunction, and in addition, pray for the
remand of the case to the LA so that appropriate proceedings may be taken

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particularly, service of proper summons may be done. But he has to post a bond of
P50,000.00 and above, depending on the discretion of the Commission.

o Motion to declare respondent in default (Section 5e)


o Motion for reconsideration of any decision or any order of the Labor
Arbiter (Section 5f)
o Appeal from any interlocutory order of the Labor Arbiter, such as but not
limited to, an order (Section 5g):
Denying a motion to dismiss (Section 5g(1))
Denying a motion to inhibit (Section 5g(2))
Denying a motion for issuance of writ of execution (Section 5g(3))
Denying a motion to quash writ of execution (Section 5g(4))
Interlocutory order: An order that relates to some intermediate
matter in the case; any order other than a final order. (Blacks Law
Dictionary) A decree that is made during the course of an action and
that does not settle all matters in dispute. (Merriam-Websters
Dictionary of Law)
o Appeal from the issuance of a certificate of finality of decision by the
Labor Arbiter (Section 5h)
o Appeal from orders issued by the Labor Arbiter in the course of execution
proceedings (Section 5i)
Examples: Opposition to the Motion for Issuance of a Writ of Execution;
Motion to Quash Writ of Execution; Motion to Recompute Judgment
Award
If respondent is really aggrieved, resort to extraordinary remedies
under Rule XII
o Such other pleadings, motions and petitions of similar nature intended to
circumvent above provisions (Section 5j)
Before the date set for the mandatory conciliation and mediation conference,
the respondent may file a motion to dismiss, which shall be immediately
resolved by the LA through a written order. An order denying a motion to
dismiss, or suspending its resolution until the final determination of the case,
is not appealable. (Section 6) No motion to dismiss shall be allowed or
entertained after the lapse of the period provided in Section 6. (Section 7)
Purpose of the mandatory conciliation and mediation conference: (Section 8a)
o Amicably settling the case upon a fair compromise (Section 8a(1));
o Determining the real parties in interest (Section 8a(2));
o Determining the necessity of amending the complaint and including all
causes of action (Section 8a(3));
o Defining and simplifying the issues in the case (Section 8a(4));
o Entering into admissions or stipulations of facts (Section 8a(5)); and
o Threshing out all other preliminary matters (Section 8a(6))
Any agreement entered into by the parties whether in partial or full
settlement of the dispute shall be reduced into writing and signed by the

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MACAPAGAL, STEPHANIE LUZETTE M. BSU COLLEGE OF LAW
parties and their counsel or the parties authorized representatives, if any
(Section 8b)
A compromise agreement duly entered into shall be final and binding upon
the parties and shall have the force and effect of a judgment rendered by the
LA (Section 8d)
The mandatory conciliation and mediation conference shall, except for
justifiable grounds, be terminated within 30 calendar days from the date of
the first conference (Section 8e)
No motion for postponement shall be entertained except on meritorious
grounds and when filed at least 3 days before the scheduled hearing. (Section
8f)
If the parties fail to agree on an amicable settlement, either in whole or in
part, during the mandatory conciliation and mediation conference, the LA
shall proceed to the other purposes of the said conference (Section 9)
The non-appearance of the complainant or petitioner during the two settings
for mandatory conciliation and mediation conference scheduled in the
summons, despite due notice thereof, shall be a ground for the dismissal of
the case without prejudice (Section 10, par. 1)
o In case of two dismissals, the second dismissal shall be with prejudice
already
In case of non-appearance by the respondent during the first scheduled
conference, the second conference as scheduled in the summons shall
proceed. If the respondent still fails to appear at the second conference
despite being duly served with summons, he/she shall be considered to have
waived his/her right to file position paper. The LA shall immediately terminate
the mandatory conciliation and mediation conference and direct the
complainant or petitioner to file a verified position paper and submit evidence
in support of his/her causes of action and thereupon render his/her decision
on the basis of the evidence on record. (Section 10, par. 2)
No amendment of the complaint or petition shall be allowed after the filing of
position papers, unless with leave of the LA (Section 11b)
The position papers of the parties shall cover only those claims and causes of
action stated in the complaint or amended complaint, accompanied by all
supporting documents, including the affidavits of witnesses, which shall take
the place of their direct testimony, excluding those that may have been
amicably settled (Section 11c)
The reply shall not allege and/or prove facts and any cause or causes of
action not referred to or included in the original or amended complaint or
petition or raised in the position paper (Section 11d)
After the submission by the parties of their position paper or reply, as the
case may be, the LA shall, motu proprio, determine whether there is a need
for a hearing or clarificatory conference (Section 12)
The LA shall make a written summary of the proceedings of the clarificatory
conference, including the substance of the evidence presented, in
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MACAPAGAL, STEPHANIE LUZETTE M. BSU COLLEGE OF LAW
consultation with the parties. The written summary shall be signed by the
parties and shall form part of the records. (Section 13b)
The hearing or clarificatory conference shall be terminated within 30 calendar
days from the date of the initial clarificatory conference. (Section 14a)
o In cases involving OFWs, the aggregate period for conducting the
mandatory conciliation and mediation conference, including hearing on
the merits or clarificatory conference, shall not exceed 60 days, which
shall be reckoned from the date of acquisition of jurisdiction by the LA
over the person of the respondents. (Section 14c)
In case of non-appearance of any of the parties during the hearing or
clarificatory conference despite due notice, proceedings shall be conducted
ex-parte. Thereafter, the case shall be deemed submitted for decision.
(Section 14b)
Grounds for inhibition (Section 16)
o Relationship within the fourth civil degree of consanguinity or affinity with
the adverse party or counsel
o Question of partiality
o Other justifiable ground
Motion for inhibition shall be resolved within 5 days from the filing thereof. An
order denying or granting a motion for inhibition is inappealable. (Section 16)
The LA shall render his/her decision within 30 calendar days, without
extension, after the submission of the case by the parties for decision, even
in the absence of stenographic notes. (Section 17)
o Except: OFW cases, to be decided within 90 calendar days after the filing
of the complaint
Contents of decisions (Section 18)
o Facts of the case
o Issues involved
o Applicable laws or rules
o Conclusions and the reasons therefor
o Specific remedy or relief granted
o If monetary award, the amount awarded
o If order of reinstatement, shall also contain:
Statement that reinstatement aspect is immediately executory; and
Directive for the employer to submit a report of compliance within 10
calendar days from receipt of the said decision
If no appeal is filed with the Commission within the time provided under
Article 223 of the Labor Code, and Section 1, Rule VI of these Rules, the
decision or order of the LA shall become final and executory after 10 calendar
days from receipt thereof by the counsel or authorized representative or the
parties if not assisted by counsel or representative (Section 20)

Article 223. Appeal. Decisions, awards, or orders of the Labor Arbiter are final and
executory unless appealed to the Commission by any or both parties within 10

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MACAPAGAL, STEPHANIE LUZETTE M. BSU COLLEGE OF LAW
calendar days from receipt of such decisions, awards, or orders. Such appeal may
be entertained only on any of the following grounds:

(a) If there is prima facie evidence of abuse of discretion on the part of the Labor
Arbiter;
(b) If the decision, order, or award was secured through fraud or coercion,
including graft and corruption;
(c) If made purely on questions of law; and
(d) If serious errors in the findings of facts are raised which would cause grave or
irreparable damage or injury to the appellant.

In case of a judgment involving 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 Commission in the amount
equivalent to the monetary award in the judgment appealed therefrom.

In any event, the decision of the Labor Arbiter reinstating a dismissed or


separated employee, insofar as the reinstatement aspect is concerned, shall
immediately be executory, even pending appeal. The employee shall either be
admitted back to work under the same terms and conditions prevailing prior to his
dismissal or separation or, at the option of the employer, merely reinstated in the
payroll. The posting of a bond by the employer shall not stay the execution for
reinstatement provided herein.

To discourage frivolous or dilatory appeals, the Commission or the Labor


Arbiter shall impose reasonable penalty, including fines or censures, upon the erring
parties.

In all cases, the appellant shall furnish a copy of the memorandum of appeal
to the other party who shall file an answer not later than 10 calendar days from
receipt thereof.

The Commission shall decide all cases within 20 calendar days from receipt
of the answer of the appellee.

The decision of the Commission shall be final and executory after 10 calendar
days from receipt thereof by the parties.

Any law enforcement agency may be deputized by the Secretary of Labor


and Employment or the Commission in the enforcement of decisions, awards, or
orders.

Certificate of finality (Section 19) may be issued after 60 calendar days


from date of mailing in the absence of return cards, certifications from the
post office, or other proofs of service to the parties
o Execution can commence after the issuance of said certificate

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MACAPAGAL, STEPHANIE LUZETTE M. BSU COLLEGE OF LAW
A party may file a motion to revive or re-open a case dismissed without
prejudice, within 10 calendar days from receipt of notice of the order
dismissing the same; otherwise, the only remedy shall be to re-file the case.
(Section 20)
A party declared to have waived his/her right to file position paper may, at
any time after notice thereof and before the case is submitted for decision,
file a motion under oath to set aside the order of waiver upon proper showing
that his/her failure to appear was due to justifiable and meritorious grounds.
(Section 20)

RULE VI APPEALS

Decisions, awards, or orders of the LA shall be final and executory unless


appealed to the Commission by any or both parties within 10 calendar days
from receipt thereof (Section 1, par. 1)
In case of decisions or resolutions of the Regional Director of the DOLE
pursuant to Article 129 of the Labor Code, within 5 calendar days from receipt
thereof. (Section 1, par. 1)
If the 10th or 5th day, as the case may be, falls on a Saturday, Sunday, or
holiday, the last day to perfect the appeal shall be the first working day
following such Saturday, Sunday, or holiday. (Section 1, par. 1)
o Date of mailing = Date of filing EXCEPT in the case of a special courier,
where date of actual receipt is the date of filing
No motion or request for extension of the period within which to perfect an
appeal shall be allowed. (Section 1, par. 2)
Grounds for appeal are the same grounds enumerated in Article 223 of the
Labor Code (Section 2)
The appeal shall be filed with the RAB o Regional Office where the case was
heard and decided (Section 3)
Requisites for perfection of appeal (Section 4a)
o Filed within the reglementary period (Section 4a(1));
Mandatory and jurisdictional, except in the interest of truth and
justice, or to serve the broader interest of justicemake sure you
can justify why you cannot have filed it within the reglementary period,
but make sure youre only late within 1-5 days, OR ELSE
Another justification: Proceedings before the labor tribunals are not
bound by the strict rules of procedure and technicalities
o Verified by the appellant himself/herself (Section 4a(2));
o In the form of a memorandum of appeal which shall state the grounds
relied upon and the arguments in support thereof, the relief prayed for,
and with a statement of the date the appellant received the appealed
decision, award, or order (Section 4a(3));
Not just an appeal but also an appeal memorandum together with the
notice of appealsome lawyers, if they dont have time, only file a
notice of appeal and an appeal memorandum thats quite sketchy, and
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MACAPAGAL, STEPHANIE LUZETTE M. BSU COLLEGE OF LAW
in the prayer portion, they pray for time to be allowed to file a
supplemental appeal memorandum
o In three legibly typewritten or printed copies (Section 4a(4))
o Accompanied by (Section 4a(5)):
Proof of payment of the required appeal fee and legal research fee
(Section 4a(5i));
Posting of a cash or surety bond (Section 4a(5ii)); and
NOTE: The appellee has the obligation to verify whether the bond is
regular or not (Section 6, par. 4)
Cannot be just an ordinary personal check; must be either
managers check or cashiers check
Proof of service upon the other parties (Section 4a(5iii))
A mere notice of appeal without complying with the other requisites shall not
stop the running of the period for perfecting an appeal (Section 4b)
o A motion to reduce bond does not toll the reglementary period
The appellee should file his answer or reply to appellants memorandum of
appeal not later than 10 calendar days from receipt thereof. Failure to file the
same on the said period may be construed as a waiver on his/her part to file
the same. (Section 4c)
Once the appeal is perfected in accordance with these Rules, the Commission
shall limit itself to reviewing and deciding only the specific issues that were
elevated on appeal, subject to the provisions of Article 218 of the Labor Code.
(Section 4d)
o Only those parties who have appealed can pray for affirmative relief
In case the decision of the LA or the RD involves a monetary award, an
appeal by the employer may be perfected only upon the posting of a bond,
which shall either be in the form of cash deposit or surety bond equivalent in
amount to the monetary award, exclusive of damages and attorneys fees.
(Section 6)
Requirements for surety bond (Section 6)
o Must be issued by a reputable bonding company duly accredited by the
Commission or the Supreme Court
o Must be accompanied by original or certified true copies of the following:
A joint declaration under oath by the employer, his/her counsel, and
the bonding company, attesting that the bond posted is genuine, and
shall be in effect until final disposition of the case (Section 6a);
An indemnity agreement between the employer-appellant and the
bonding company (Section 6b);
Proof of security deposit or collateral securing the bond: Provided, that
a check shall not be considered as an acceptable security (Section 6c);
A certificate of authority from the Insurance Commission (Section 6d);
Certificate of registration from the Securities and Exchange
Commission (Section 6e);
Certificate of accreditation and authority from the Supreme Court
(Section 6f); and
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Notarized board resolution or secretarys certificate from the bonding
company showing its authorized signatories and their specimen
signatures (Section 6g).
IMPORTANT NOTE: The Commission through the Chairman may on
justifiable grounds blacklist a bonding company, notwithstanding its
accreditation by the Supreme Court (Section 6, par. 2)
A cash or surety bond shall be valid and effective from the date of deposit or
posting, until the case is finally decided, resolved, or terminated, or the
award satisfied. This condition shall be deemed incorporated in the terms and
conditions of the surety bond, and shall be binding on the appellants and the
bonding company. (Section 6, par. 3)
No motion to reduce bond shall be entertained except on meritorious
grounds, and only upon the posting of a bond in a reasonable amount in
relation to the monetary award. (Section 6, par. 6)
The mere filing of a motion to reduce bond without complying with the
requisites in the preceding paragraphs shall not stop the running of the
period to perfect an appeal. (Section 6, par. 7)

RURAL BANK OF CORON v. CORTES, supra.

Facts: The LA decided in favor of Cortes. On the last day of the period of appeal,
petitioners filed a notice of appeal and motion for reduction of bond to which they
attached a memorandum on appeal, stating that the corporations were under
financial distress. They prayed that the amount of bond be substantially reduced,
preferably to one-half thereof or even lower. The NLRC dismissed the appeal for
failure to comply with the requirement of the filing of the appeal bond. The CA also
dismissed the petition.

Issue: W/N the filing of an appeal bond is a condition precedent for perfecting an
appeal, and non-compliance thereof warrants dismissal.

Ruling: YES. Contrary to petitioners assertion, the CA dismissed its petition


not on a mere technicality. For the non-posting of a bond within the reglementary
period divests the NLRC of its jurisdiction to entertain the appeal. Article 223 of the
Labor Code, which prescribes the appeal bond requirement, is a rule of jurisdiction
and not of procedure. There is a little leeway for condoning a liberal interpretation
thereof, and certainly none premised on the ground that its requirements are mere
technicalities. It bears emphasis that all that is required to perfect the appeal is the
posting of a bond to ensure that the award is eventually paid should the appeal be
dismissed. Petitioners should thus have posted a bond, even if it were only partial,
but they did not. No relaxation of the Rule may thus be considered.

In the case at bar, the petitioners did not post a full or partial bond within the
prescribed period, thus, no appeal was perfected from the decision of the LA. For
this reason, the decision sought to be appealed to the NLRC had become final and

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executory and therefore immutable. Clearly then, the NLRC has no authority to
entertain the appeal, much less to reverse the decision of the LA. Any amendment
or alteration made which substantially affects the final and executory judgment is
null and void for lack of jurisdiction, including the entire proceeding held for that
purpose.

Petition is denied.

Once an appeal is filed, the LA loses jurisdiction over the case, without
prejudice to immediate reinstatement pending appeal under Section 6, Rule
XI (Section 9)
o Instead of a certificate of finality, once an appeal is filed, the LA issues an
entry of judgment
o A motion for reconsideration is a prohibited pleading; it MAY be treated as
an appeal by the LA provided that all the requisites for the filing of an
appeal are present
o Additionally, only the reinstatement order COMING FROM THE LABOR
ARBITER is immediately executory; all the others are not, even those
coming from the Commission
No appeal from an interlocutory order shall be entertained. To discourage
frivolous or dilatory appeals, including those taken from interlocutory orders,
the Commission after hearing may censure or cite in contempt the erring
parties and their counsels, or subject them to reasonable fine or penalty.
(Section 10)
ADDITIONAL NOTES:
o New evidence may be adduced on appeal, subject to the requirement that
an explanation why it was not submitted seasonably and that the reason
why it was not earlier available be given, otherwise it shall be treated as
forgotten evidence
o Raising new issues on appeal is not allowed.
o The theory of appeal may be changed due to the ground of lack of
jurisdiction, but only as an exception. The general rule is that the theory of
appeal should not be changed on whatever ground.
o Filing a motion for reconsideration before the NLRC is a prerequisite for
the filing of a petition for certiorari before the CAexhaustion of
administrative remedies
o Appeal from Voluntary Arbitrator to Supreme Court by way of Rule 43

RULE VII PROCEEDINGS BEFORE THE COMMISSION

Jurisdiction of the NLRC: exclusive, original, and appellate jurisdiction in


accordance with law (Section 1)
Powers of the NLRC
o APPELLATE (Article 217b)

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MACAPAGAL, STEPHANIE LUZETTE M. BSU COLLEGE OF LAW
o RULE-MAKING: To promulgate rules and regulations governing hearing and
disposition of cases before it and its regional branches, as well as those
pertaining to its internal functions and such rules and regulations as may
be necessary to carry out the purposes of this Code (Article 218a);
o POWER TO ISSUE COMPULSORY PROCESSES: To administer oaths, summon
the parties to a controversy, issue subpoenas requiring the attendance
and testimony of witnesses or the production of such books, papers,
contracts, records, statements of accounts, agreements, and others as
may be material to a just determination of the matter under investigation,
and to testify in any investigation or hearing conducted in pursuance of
this Code (Article 218b);
o POWER TO HEAR: To conduct investigation for the determination of a
question, matter or controversy within its jurisdiction, proceed to hear and
determine the disputes in the absence of any party thereto who has been
summoned or served with notice to appear, adjourn its hearings to any
time and place, refer technical matters or accounts to an expert and to
accept his report as evidence after hearing of the parties upon due notice,
direct parties to be joined in or excluded from the proceedings, correct,
amend, or waive any error, defect, or irregularity, whether in substance or
in form, give all such directions as it may deem necessary or expedient in
the determination of the dispute before it, and dismiss any matter or
refrain from hearing further or from determining the dispute or part
thereof, where it is trivial or where further proceedings by the Chairman
are not necessary or desirable (Article 218c);
The complaint is pro forma; complainant only required to check the
boxes pertaining to complainants cause/s of action
o CONTEMPT: To hold any person in contempt directly or indirectly and
impose appropriate penalties therefor in accordance with law (Article
218d);
o INJUNCTIVE: To enjoin or rerstrain 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 (Article 218e)
o OCULAR INSPECTION: The Chairman, any Commissioner, Labor Arbiter, or
their duly authorized representatives may at any time during working
hours conduct an ocular inspection on any establishment, building, ship,
or vessel, place or premises, including any work, material, implement,
machinery, appliance or any object therein, and ask any employee,
laborer or any person as the case may be for any information or data
concerning any matter or question relative to the object of the
investigation (Article 219)
Forum non conveniens: The doctrine that an appropriate forumeven though
competent under the lawmay divest itself of jurisdiction if, for the
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MACAPAGAL, STEPHANIE LUZETTE M. BSU COLLEGE OF LAW
convenience of the litigants and the witnesses, it appears that the action
should proceed in another forum in which the action might also have been
properly brought in the first place (Blacks Law Dictionary); A doctrine
allowing a court with jurisdiction over a case to dismiss it because the
convenience of the parties and the interest of justice would be better served
if the case were brought in a court having proper jurisdiction in another
venue (Merriam-Websters Dictionary of Law)

MANILA HOTEL CORP. v. NLRC (GR No. 120077, 13 October 2000) Pardo

Facts: Marcelo Santos was an overseas worker employed as a printer in Oman. He


was subsequently directly hired by the Palace Hotel, Beijing, and later terminated
due to retrenchment. Manila Hotel Corporation was a government-owned and
controlled corporation, and an incorporator of Manila Hotel International Company,
which, by virtue of a management agreement with the Palace Hotel, trained the
personnel and staff of the Palace Hotel.

Santos, after his repatriation to the Philippines, demanded full compensation


pursuant to the employment agreement. This being denied, he filed a complaint for
illegal dismissal against MHC, MHICL, the Palace Hotel, and Mr. Gerhard Shmidt,
Palace Hotels General Manager. The Palace Hotel and Mr. Shmidt were not served
with summons and neither participated in the proceedings before the LA. The LA
decided in favor of Santos and ordered them to jointly and severally pay unearned
salaries, moral and exemplary damages, and attorneys fees. Aggrieved, MHC and
MHICL appealed to the NLRC, which dismissed Santos complaint for want of
jurisdiction. It directed Santos to file a case with the POEA instead. Santos moved
for reconsideration on the ground that the case was not cognizable by the POEA
because he was not an overseas contract worker. The NLRC then reversed itself
and directed an LA to hear the case on the question of whether Santos was
retrenched or dismissed. The LA subsequently found that Santos was illegally
dismissed from employment and recommended that he be paid actual damages
equivalent to his salaries for the unexpired term of his contract. MHCs motion for
reconsideration and appeal to the NLRC were denied.

Issue: W/N the NLRC had jurisdiction over the case.

Ruling: NO. The NLRC was a seriously inconvenient forum. The main aspects of
the case transpired in two foreign jurisdictions and the case involves purely foreign
elements. The only link that the Philippines has with the case is that Santos is a
Filipino citizen. The Palace Hotel and MHICL are foreign corporations. Not all cases
involving our citizens can be tried here.

It cannot be seen how the NLRC is a convenient forum given that all the
incidents of the casefrom the time of recruitment, to employment to dismissal
occurred outside the Philippines. The inconvenience is propounded by the fact that

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the proper defendants, the Palace Hotel and MHICL, are not nationals of the
Philippines. Neither are they doing business in the Philippines. Likewise, the main
witnesses are not residents of the Philippines. Neither can an intelligent decision be
made as to the law governing the employment contract as such was perfected in
foreign soil. This calls to fore the application of the principle of lex loci contractus.
Neither can the NLRC determine the facts surrounding the alleged illegal dismissal
as all acts complained of took place in Beijing, China. The NLRC was not in a position
to determine whether the Tiannanmen Square incident truly adversely affected
operations of the Palace Hotel as to justify Santos retrenchment. Even assuming
that a proper decision could be reached by the NLRC, such would not have a binding
effect against the employer, the Palace Hotel. The Palace Hotel is a corporation
incorporated under the laws of China and was not even served with summons.
Jurisdiction over its person was not acquired. Even assuming that the NLRC was the
proper forum, even on the merits, the NLRCs decision cannot be sustained.

Considering the NLRC was forum non conveniens and considering the fact
that no employer-employee relationship existed between MHICL, MHC, and Santos,
the LA clearly had no jurisdiction over Santos claim. In all cases involving LAs
exclusive and original jurisdiction, an employer-employee relationship is an
indispensable jurisdictional requirement. Since the lack of jurisdiction of the LA was
obvious from the allegations of the complaint, the LAs failure to dismiss the case
amounts to grave abuse of discretion.

Petition granted. NLRC resolutions annulled.

Under the rule of forum non conveniens, a Philippine court or agency may
assume jurisdiction over the case if it chooses to do so provided: (1) that the
Philippine court is one to which the parties may conveniently resort to; (2)
that the Philippine court is in a position to make an intelligent decision as to
the law and facts; and (3) that the Philippine court has or is likely to have
power to enforce its decision.

PHILIPPINE NATIONAL BANK v. FLORENCE CABANSAG (GR No. 157010, 21 June


2005) Panganiban

Facts: Florence Cabansag was directly hired by the Singapore branch of Philippine
National Bank, a private banking corporation organized and existing under the laws
of the Philippines. She then filed an application with the Ministry of Manpower of the
Government of Singapore for the issuance of an Employment Pass as an
employee of the PNB Singapore Branch. Her application was approved for a period
of two years. Ruben Tobias, the General Manager and Vice President of the
Singapore branch, offered Cabansag a temporary appointment on 7 December 1998
as Credit Officer and, upon her successful completion of her three-month probation,
she may be extended a permanent appointment. Cabansag accepted the position
and assumed office. In the meantime, the Philippine Embassy in Singapore
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processed her employment contract and on 8 March 1999, she was issued by the
POEA an Overseas Employment Certificate certifying that she was a bona fide
contract worker for Singapore.

On 14 April 1999, Cabansag was informed by Cecilia Aquino, the Assistant


Vice President and Deputy General Manager of the Bank, as well as by Rosanna
Sarmiento, the Chief Dealer of the said branch, that Tobias had asked them to tell
her to resign from her job. Tobias confirmed the veracity of the information,
explaining that her resignation was a cost-cutting measure, and that the PNB
Singapore branch will be sold or transformed into a remittance office. He forced her
to submit a resignation letter, to which she refused, asking time to find a new job.
Tobias gave her an ultimatum that she should resign by 15 May 1999, but ultimately
terminated her services by 20 April 1999.

The LA rendered judgment in favor of Cabansag and ordered PNB to reinstate


her, and to pay her full backwages, mid-year bonus, allowance for Sunday banking,
monetary equivalent of leave credits earned, unused sick leave benefits, and
unused vacation leave benefits, as well as 13th month pay. PNB was also ordered to
pay Cabansag actual, moral, and exemplary damages, as well as attorneys fees.
The NLRC affirmed the LA decision, only reducing the award of moral and exemplary
damages. The CA also rendered judgment in favor of Cabansag.

Issue: W/N the arbitration of the NLRC in the National Capital Region is the most
convenient venue or forum to hear or decide the instant controversy.

Ruling: YES. Las have original and exclusive jurisdiction over claims arising
from employer-employee relations, including termination disputes involving all
workers, among whom are overseas Filipino workers.

Cabansag was directly hired, while on a tourist status in Singapore, by the


PNB branch in that city-state. Prior to employing Cabansag, PNB had to obtain an
employment pass for her from the Singapore Ministry of Manpower. Securing the
pass was a regulatory requirement pursuant to the immigration regulations of that
country. Similarly, the Philippine government requires non-Filipinos working in the
country to first obtain a local work permit in order to be legally employed here. The
permit, however, does not automatically mean that the non-citizen is thereby bound
by local laws only. It does not at all imply a waiver of ones national laws on labor.
Absent any clear and convincing evidence to the contrary, such permit simply
means that its holder has a legal status as a worker in the issuing country.
Noteworthy is the fact that Cabansag likewise applied for and secured an Overseas
Employment Certificate from the POEA through the Philippine Embassy in
Singapore, which declared her as a bona fide worker for Singapore. Under Philippine
law, this document authorized her working status in a foreign country and entitled
her to all benefits and processes under our statutes. Even assuming arguendo that
she was considered at the start of her employment as a direct hire governed by

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MACAPAGAL, STEPHANIE LUZETTE M. BSU COLLEGE OF LAW
and subject to the laws, common practices and customs prevailing in Singapore, she
subsequently became a contract worker or an OFW who was covered by Philippine
labor laws and policies upon certification by the POEA. At the time her employment
was illegally terminated, she already possessed the POEA employment certificate.
Moreover, PNB admits that it is a Philippine corporation doing business through a
branch office in Singapore. Significantly, Cabansags employment by the Singapore
branch office had to be approved by the president of the bank whose principal
offices were in Manila. This circumstance militates against PNBs contention that
Cabansag was locally hired and totally governed by and subject to the laws,
common practices and customs of Singapore, not of the Philippines. Instead, with
more reason does this fact reinforce the presumption that Cabansag falls under the
legal definition of migrant worker, in this case one deployed in Singapore. Hence,
PNB cannot escape the application of Philippine laws or the jurisdiction of the NLRC
and the labor arbiter.

Petition denied.

RULE VIII CERTIFIED CASES

It is the declared policy of certification of labor disputes for compulsory


arbitration to ensure and maintain industrial peace based on social justice
and national interest by having a full, complete and immediate settlement or
adjudication of all labor disputes between the parties, as well as issues that
are relevant to or incidents of the certified issues (Section 1)
Certified labor disputes cases certified to the Commission for compulsory
arbitration under Article 263(g) of the Labor Code (Section 2)
Effects of Certification (Section 3)
o Upon certification, the intended or impending strike or lockout is
automatically enjoined, notwithstanding the filing of any motion for
reconsideration of the certification order nor the non-resolution of any
such motion which may have been duly submitted to the Office of the
Secretary of Labor and Employment. If a work stoppage has already taken
place at the time of the certification, all striking or locked out employees
shall immediately return to work and the employer shall immediately
resume operations and readmit all workers under the same terms and
conditions prevailing before the strike or lockout (Section 3a)
o All cases between the same parties, except where the certification order
specifies otherwise the issues submitted for arbitration which are already
filed or may be filed, and are relevant to or are proper incidents of the
certified case, shall be considered subsumed or absorbed by the certified
case, and shall be decided by the appropriate Division of the Commission
(Section 3b, par. 1)
o Whenever a certified labor dispute involves a business entity with several
workplaces located in different regions, the Division having territorial
jurisdiction over the principal office of the company shall acquire
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MACAPAGAL, STEPHANIE LUZETTE M. BSU COLLEGE OF LAW
jurisdiction to decide such labor dispute; unless the certification order
provides otherwise (Section 3c)
Effects of Defiance (Section 4): Non-compliance with the certification order of
the Secretary of Labor and Employment shall be considered as an illegal act
committed in the course of the strike or lockout, and shall authorize the
Commission to enforce the same under pain of immediate disciplinary action,
including dismissal or loss of employment status or payment by the locking-
out employer of backwages, damages, and/or other affirmative relief, even
criminal prosecution against the liable parties; the Commission may also seek
the assistance of law enforcement agencies to ensure compliance and
enforcement of its orders and resolutions
Procedure (Section 5)
o When there is no need to conduct a clarificatory hearing, the Commission
shall resolve all certified cases within 30 calendar days from receipt by the
assigned Commissioner of the complete records, which shall include the
position papers of the parties and the order of the Secretary of Labor and
Employment denying the motion for reconsideration of the certification
order, if any (Section 5a)
o Where a clarificatory hearing is needed, the Commission shall, within five
calendar days from receipt of the records, issue a notice to be served on
the parties through the fastest means available, requiring them to appear
and submit additional evidence, if any. All certified cases shall be resolved
by the Commission within 60 calendar days from receipt of the complete
records by the assigned Commissioner (Section 5b)
o No motion for extension or postponement shall be entertained (Section
5c)
Upon issuance of the entry of judgment, the Commission, motu proprio or
upon motion by the proper party, may cause the execution of the judgment in
the certified case (Section 6)

RULE IX CONTEMPT

Direct Contempt (Section 1)


o Who may issue:
Chairman
Any Commissioner or Labor Arbiter
o How issued: SUMMARILY
o Grounds: Committing any act of misbehavior in the presence of or so near
the Chairman or any Commissioner or Labor Arbiter as to obstruct or
interrupt the proceedings before the same, including:
Disrespect toward said officials
Offensive acts toward others
Refusal to be sworn or to answer as a witness or to subscribe to an
affidavit or deposition when lawfully required to do so
o Punishment:

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MACAPAGAL, STEPHANIE LUZETTE M. BSU COLLEGE OF LAW
When committed against the Commission or any member thereof:
Fine not exceeding P500.00 and/or
Imprisonment not exceeding five days
When committed against any LA:
Fine not exceeding P100.00 and/or
Imprisonment not exceeding one day
o Appeal:
From LA: to Commission within a period of five calendar days from
notice of the judgment, and execution of said judgment shall be
suspended pending resolution of the appeal upon the filing by said
person of a bond on condition that he will abide by and perform the
judgment should the appeal be decided against him/her (Section 1,
par. 2)
From Commission: immediately executory and inappealable (Section 1,
par. 2)
Indirect Contempt (Section 2)
o Who may issue:
Commission
Any Labor Arbiter pursuant to Article 218(d) of the Labot Code
o Grounds:
Misbehavior of any officer or employee in the performance of his/her
official duties or in his/her official transaction (Section 2a);
Disobedience of, or resistance to, a lawful writ, order or decision
(Section 2b);
Any abuse of, or any unlawful interference with the processes or
proceedings not constituting direct contempt (Section 2c);
Any improper conduct tending, directly or indirectly, to impede,
obstruct, or degrade the administration of justice (Section 2d);
Assuming to be an attorney or a representative of party without
authority (Section 2e);
Failure to obey a subpoena duly served (Section 2f); or
Other grounds analogous to the foregoing (Section 2g)
o Where charge to be filed (Section 2A)
Against Commission or an Officer appointed by it: Commission;
Against LA: RAB subject to appeal to the Commission
o How commenced (Section 2B):
Motu proprio by the Commission or any LA by an order or any other
formal charge requiring the respondent to show cause why he/she
should not be punished for contempt
Other cases: Verified petition with supporting particulars and certified
true copies of documents or papers involved therein, and upon full
compliance with the requirements for filing initiatory pleadings in the
Commission
If the contempt charge arose out of or is related to a principal
action pending in the Commission or RAB, the petition for contempt

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MACAPAGAL, STEPHANIE LUZETTE M. BSU COLLEGE OF LAW
shall allege that fact but said petition shall be consolidated, heard,
and decided separately, unless the Commission or LA in its/his/her
discretion, orders the consolidation of the contempt charge and the
principal action for joint hearing and decision
o Upon the date set for hearing, the Commission or LA shall proceed to
investigate the charge and consider such comment, answer, defense, or
testimony as the respondent may make or offer; failure to attend the
scheduled hearing and to give a satisfactory explanation in writing to the
Commission or the LA will result in the waiver of the respondent to be
present during the hearing (Section 2C)
o Punishment (Section 2D):
Against the Commission or any member thereof: fine of P1,000.00 per
day for every act of indirect contempt
Against any LA: fine of P500.00 per day for every act of indirect
contempt
Each day of defiance of, or disobedience to, or non-enforcement of
a final order, resolution, decision, ruling, injunction, or processes,
shall constitute an indirect contempt of the Commission
If the contempt consists of the violation of an injunction or omission
to do an act which is within the power of the respondent to perform,
the respondent shall, in addition, be made liable for damages as a
consequence thereof, which shall be measured by the extent of the
loss or injury sustained by the aggrieved party by reason of the acts
or omission of which the contempt is being prosecuted, and the
costs of the proceedings, including payment of interest on damages
A writ of execution may be issued to enforce the decision imposing
such fine and/or consequent damages as punishment (Section 2E)

LAND BANK OF THE PHILIPPINES v. SEVERINO LISTANA, SR. (GR No. 152611, 5
August 2003) Ynares-Santiago

Facts: Severino Listana is the owner of a parcel of land in Sorsogon. He voluntarily


offered to sell the said land to the government, through the Department of Agrarian
Reform under the Comprehensive Agrarian Reform Law. The DAR valued the
property at an amount which was not acceptable to Listana, hence, the DAR
Adjudication Board commenced summary administrative proceedings to determine
the just compensation of the land. A writ of execution was then issued directing the
manager of Land Bank to pay Listana the amount defined by DARAB as just
compensation for Listanas land. Subsequently, Listana filed a Motion for Contempt
with the PARAD, alleging that Land Bank failed to comply with the writ of execution,
and that such action constitutes contempt of the DARAB.

The PARAD then issued an order granting the Motion for Contempt and
subsequently ordered the issuance of an Alias Writ of Execution for the payment of
the adjudged amount of just compensation to Listana. When it was not complied
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MACAPAGAL, STEPHANIE LUZETTE M. BSU COLLEGE OF LAW
with, an arrest order against the Land Bank manager was issued. A preliminary
injunction was prayed for by the Land Bank from the Sorsogon RTC, which was
granted. On appeal, the CA nullified the order of the RTC.

Issue: W/N the contempt order was validly issued against the Land Bank manager.

Ruling: NO. There are only two ways a person can be charged with indirect
contempt, namely, (1) through a verified petition; and (2) by order or formal charge
initiated by the court motu proprio. In the case at bar, neither of these modes was
adopted in charging the Land Bank manager with indirect contempt.

Evidently, quasi-judicial agencies that have the power to cite persons in


contempt pursuant to Rule 71 of the Rules of Court can only do so by initiating them
in the proper RTC. It is not within their jurisdiction and competence to decide the
indirect contempt cases. These matters are still within the province of the RTCs. In
the present case, the indirect contempt charge was filed, not with the RTC, but with
the PARAD, and it was PARAD that cited the Land Bank manager with indirect
contempt.

Petition granted, CA decision reversed and set aside.

NOTE: This rule does not apply anymore. The NLRC does not need to go to the RTC
to issue indirect contempt orders, by virtue of the rule-making power of the
Commission found in Article 218 of the Labor Code.

RULE X INJUNCTION

Ordinary labor disputes: a preliminary injunction or restraining order may be


granted by the Commission when it is established on the basis of the sworn
allegation in the petition that the acts complained of involving or arising from
any labor dispute before the Commission, 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 (Section 1, par. 1)
o Must be accompanied by a certification of non-forum shopping (Section 1,
par. 2)
o The writ of preliminary injunction or temporary restraining order shall
become effective only upon posting of the required cash bond in the
amount to be determined by the Commission to answer for any damage
that may be suffered by the party enjoined, if it is finally determined that
the petitioner is not entitled thereto (Section 1, par. 3)
Strikes or lockouts (Section 2): a preliminary or permanent injunction may be
granted by the Commission only after hearing the testimony of witnesses and
with opportunity for cross-examination in support of the allegations of the
complaint or petition made under oath, and testimony by way of opposition
thereto, if offered, and only after a finding of fact by the Commission:

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MACAPAGAL, STEPHANIE LUZETTE M. BSU COLLEGE OF LAW
o 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 (Section 2a)
o That substantial and irreparable injury to petitioners property will follow
(Section 2b)
o That as to each item of relief to be granted, greater injury will be inflicted
upon the petitioner by the denial of relief than will be inflicted upon
respondents by the granting of relief (Section 2c)
o That petitioner has no adequate remedy at law (Section 2d)
o That the public officers charged with the duty to protect petitioners
property are unable or unwilling to furnish adequate protection (Section
2e)
Hearings shall be held after due and personal notice thereof has been served
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 acts have been threatened or committed charged with the duty to
protect petitioners property (Section 3)
The Commission may delegate the reception of evidence to any of its Labor
Arbiters, who shall conduct such hearings in such places as he/she may
determine to be accessible to the parties and their witnesses (Section 4)
o Submission of the LAs report and recommendation shall be within 15
days from such delegation
An ocular inspection may be conducted by the Chairman, any Commissioner,
LA, or their duly authorized representatives, at any time during working
hours, on any establishment, building, ship or vessel, place or premises,
including any work, material, implement, machinery, appliance, or any object
therein, and ask any employee, laborer, or any person, as the case may be,
for any information or data concerning any matter or question relative to the
object of the petition, and the ocular inspection reports shall be submitted to
the appropriate Division within 24 hours from the conduct thereof (Section 5)
Requisites of a Temporary Restraining Order:
o Testimony under oath, or by affidavits of the petitioners witnesses
alleging that, unless a temporary restraining order shall be issued without
notice, a substantial and irreparable injury to petitioners property will be
unavoidable (Section 6)
o Petitioners undertaking to answer for the damages (Section 7)
o Petitioners posting of a cash bond in the amount of P50,000.00 or such
higher amount as may be determined by the Commission to recompense
those enjoined for any loss, expense, or damage caused by the
improvident or erroneous issuance of such order or injunction, including all

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MACAPAGAL, STEPHANIE LUZETTE M. BSU COLLEGE OF LAW
reasonable costs, together with a reasonable attorneys fee, and expense
of defense against the order or against the granting of any injunctive relief
sought in the same proceeding and subsequently denied by the
Commission (Section 7)
A temporary restraining order shall be effective for no longer than 20 days
reckoned from the posting of the cash bond required; during the said period,
the parties shall be required to present evidence to substantiate their
respective positions in the main petition (Section 8)
The order or resolution enjoining the performance of illegal acts shall be
immediately executory in accordance with the terms thereof. In case of non-
compliance, the Commission shall impose such sanctions, and shall issue
such orders, as may be necessary to implement the said order or resolution,
including the enlistment of law enforcement agencies having jurisdiction over
the area for the purpose of enforcing the same (Section 9)

RULE XI EXECUTION PROCEEDINGS

Execution upon finality of decision or order (Section 1):


o A writ of execution may be issued motu proprio or on motion, upon a
decision or order that has become final and executory. (Section 1a)
Effectivity: 5 years
o If an appeal has been duly perfected and finally resolved by the
Commission, a motion for execution may be filed before the Labor Arbiter,
when the latter has possession of the case records or upon submission of
certified true copies of the decisions or final order/s sought to be enforced
including notice of decision or order and the entry of judgment, copy
furnished the adverse party (Section 1b)
o Final decisions CANNOT be disturbed: immutability of judgment doctrine
Finality of a decision is jurisdictional and it cannot be made to depend
on the convenience of a party.
Final decisions are immutable and unalterable.
Judgment becomes final by operation of law and not by judicial
declaration.
Exceptions: correction of clerical errors; harmonizing the body of
the decision with the dispositive portion; existence of a supervening
event as shown by substantial evidence; nunc pro tunc entries;
motion for reconsideration ad cautelam (with extreme caution)

Judgment nunc pro tunc: A judgment entered on a day after the time when it should
have been entered, as of the earlier date (Blacks Law Dictionary)

MANDAUE DINGHOW DIMSUM HOUSE v. NLRC (GR No. 161134, 3 March 2008)
Nachura

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MACAPAGAL, STEPHANIE LUZETTE M. BSU COLLEGE OF LAW
Facts: Mandaue Dinghow Dimsum House, a restaurant in Mandaue City, closed
down due to business losses. It filed a Notice of Retrenchment with the DOLE.
Several employees filed a case for illegal dismissal against Mandaue Dinghow and
Henry Uytengsu, the President and former General Manager of the said restaurant,
before the LA. The LA absolved Uytengsu from any liability, holding that he did not
act in bad faith an in excess of his authority. However, the LA found Mandaue
Dinghow liable and ordered it to pay the complainants their respective separation
pay.

On appeal, the NLRC affirmed the LA decision with a few modifications. The
NLRC subsequently issued an entry of judgment certifying that its decision had
already become final and executory. A writ of execution was then issued by the LA.
However, the complainants averred that the writ could not be executed as Mandaue
Dinghow could no longer be found and had transferred elsewhere; that both
Mandaue Dinghow and Uytengsu were impleaded as respondents, although in the
NLRC decision, Uytengsus name was omitted; that Uytengsu is the President and
majority stockholder of Mandaue Dinghow; and that it would be a mockery of justice
if, despite the finality of the NLRC decision, the same could not be executed on a
mere technicality. Invoking the doctrine of piercing the veil of corporate fiction, the
complainants moved that the LA, in the exercise of his equity jurisdiction, issue an
alias writ of execution directing the Sheriff to execute the judgment against
Mandaue Dinghow and Uytengsu. The LA then issued an Order decreeing that a writ
of execution be issued against the properties of the officers/stockholders of
Mandaue Dinghow. On the basis of this Order, an Alias Writ of Execution was issued.
Mandaue Dinghow and Uytengsu filed a motion to quash the writ of execution.
When notices of garnishment were served on the banks, Uytengsus bank accounts
were frozen. The LA then denied Uytengsus motion to quash the writ of execution.
Uytengsu filed a motion for reconsideration, which was also denied on the ground
that Uytengsu is jointly and severally liable with Mandaue Dinghow on the ground
that he is the President/Chairman of Mandaue Dinghow and the latter is no longer
existing.

On appeal to the CA, the CA dismissed Uytengsus petition on the following


grounds: (1) the petition failed to indicate the full names of all private respondents
and their respective complete addresses; (2) the certificate of non-forum shopping
attached to the petition was merely signed by Uytengsu without attaching the
appropriate board resolution or secretarys certificate showing his authority to file
the said petition in behalf of Mandaue Dinghow; and (3) Mandaue Dinghow and
Uytengsu failed to file a motion for reconsideration of the NLRC decision before
going to the CA on certiorari without justifying the reasons for such failure.
Uytengsu filed a motion for reconsideration claiming that the petitions failure to
indicate the full names of all private respondents and their respective addresses
was not intentional but due merely to inadvertence. Uytengsu also manifested that
he is the lone petitioner before the CA and that the petition did not include Mandaue

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MACAPAGAL, STEPHANIE LUZETTE M. BSU COLLEGE OF LAW
Dinghow anymore as the decision against the latter had long become final and
executory. Thus, Uytengsu claimed that direct resort to certiorari was justified
because despite the finality of the decision holding Mandaue Dinghow solely liable
and the writ of execution issued against the same, the LA in excess of his authority
issued an Alias Writ of Execution making Uytengsu liable for the respondents
claims, as a result of which Uytengsus bank accounts in different banks were
garnished. Uytengsu prayed that technicalities be waived in order to serve the ends
of justice. The CA denied the motion for reconsideration, holding that Uytengsu
failed to justify the non-filing of the required motion for reconsideration assailing the
NLRC decision before resorting to certiorari.

Issue 1: W/N the CA committed grave abuse of discretion and serious error in
dismissing the petition for certiorari purely on technical grounds and in not giving
due course to the same.

Ruling: YES. A motion for reconsideration of an assailed decision is deemed a


plain and adequate remedy expressly available under the law. The well-established
rule is that a motion for reconsideration is an indispensable condition before an
aggrieved party can resort to the special action for certiorari under Rule 65 of the
1997 Rules of Civil Procedure, as amended. The purpose of such rule is to afford the
erring court or agency an opportunity to rectify the error/s it may have committed
without the intervention of a higher court. The requisite motion is not only an
expeditious remedy of an aggrieved party but it also obviates an improvident and
unnecessary recourse to appellate proceedings. Failure to file a motion for
reconsideration with the NLRC before availing oneself of the special civil action for
certiorari is a fatal infirmity. However, this rule is subject to certain recognized
exceptions. The instant case falls within the recognized exceptions, namely, that the
NLRC Order is a patent nullity considering that the LA and the NLRC were devoid of
any jurisdiction to alter or modify the NLRC decision that had already attained
finality.

Issue 2: W/N the Alias Writ of Execution was validly issued despite the finality of
the NLRC decision.

Ruling: NO. The Order and Alias Writ of Execution issued by the LA are null and
void for lack of jurisdiction and for altering the tenor of the NLRC decision which
directed Mandaue Dinghow alone to pay the private respondents separation pay.
The private respondents did not assail this ruling. Thus, the same became final and
executory. Even granting that the NLRC committed a mistake in failing to indicate in
the dispositive portion that Uytengsu was solidarily liable with Mandaue Dinghow,
the correctionwhich is substantialcan no longer be allowed in this case because
the judgment has already become final and executory.

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MACAPAGAL, STEPHANIE LUZETTE M. BSU COLLEGE OF LAW
Petition granted. Alias writ of execution quashed. LA directed to implement
the final and executory decision of the NLRC against all the assets of Mandaue
Dinghow with utmost dispatch.

Notes and Doctrines:

Once a decision or order becomes final and executory, it is removed from the
power or jurisdiction of the court which rendered it to further alter or amend it. It
therefore becomes immutable and unalterable and any amendment or alteration
which substantially affects a final and executory judgment is null and void for lack of
jurisdiction, including the entire proceedings for that purpose. An order of execution
which varies the tenor of the judgment or exceeds the terms thereof is a nullity.

Execution by motion or by independent action (Section 2): A decision or order


may be executed on motion within five years from the date it becomes final
and executory. After the lapse of such period, the judgment shall become
dormant, and may only be enforced by an independent action before the RAB
of origin and within a period of ten years from date of its finality.
o After five years, the remedy is revival of judgment
o In case of partial satisfaction of judgment during the lifetime of the writ,
the LA shall motu proprio issue an updated writ reflecting the amount
collected and the remaining balance (Section 6, par. 2)

Article 224. Execution of decisions, orders, or awards.

(a) The Secretary of Labor and Employment or any Regional Director, the
Commission or any Labor Arbiter or Med-Arbiter, or the Voluntary Arbitrator
or panel of voluntary arbitrators may, motu proprio or on a motion of any
interested party, issue a writ of execution on a judgment within five years
from the date it becomes final and executory, requiring a sheriff or a duly
deputized officer to execute or enforce final decisions, orders or awards of
the Secretary of Labor and Employment or Regional Director, the
Commission, or the Labor Arbiter or Med-Arbiter or Voluntary Arbitrator or
panel of voluntary arbitrators. In any case, it shall be the duty of the
responsible officer to separately furnish immediately the counsels of record
and the parties with copies of said decisions, orders or awards. Failure to
comply with the duty prescribed herein shall subject such responsible officer
to appropriate administrative sanctions.
(b) The Secretary of Labor and Employment, and the Chairman of the
Commission may designate special sheriffs and take any measure under
existing laws to ensure compliance with their decisions, orders or awards and
those of Labor Arbiters and Voluntary Arbitrators or panel of voluntary
arbitrators, including the imposition of administrative fines which shall not be
less than five hundred pesos nor more than one thousand pesos.

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The perfection of an appeal shall stay the execution of the decision of the
Labor Arbiter except execution for reinstatement pending appeal (Section 3).
o In case the decision includes an order of reinstatement, and the employer
disobeys the directive to submit a compliance report or refuses to
reinstate the dismissed employee, the LA shall immediately issue a writ of
execution, even pending appeal, directing the employer to immediately
reinstate the dismissed employee either physically or in the payroll, and to
pay the accrued salaries as a consequence of such non-reinstatement in
the amount specified in the decision (Section 9, par. 1)
The Sheriff shall serve the writ of execution upon the employer or any
other person required by law to obey the same. If he/she disobeys the
writ, such employer or person may be cited for contempt in accordance
with Rule IX (Section 9, par. 2)

PIONEER TEXTURIZING CORP. v. NLRC (GR No. 118651, 16 October 1997) Francisco

Facts: Lourdes de Jesus has been a reviser/trimmer of Pioneer Texturizing Corp.


since 1980. As a reviser/trimmer, de Jesus based her assigned work on a paper note
posted by Pioneer. The posted paper which contains the corresponding price for the
work to be accomplished by a worker is identified by its P.O. Number. In 1992, she
worked on P.O. No. 3853 by trimming the cloths ribs. She thereafter submitted
tickets corresponding to the work done to her supervisor. Three days later, de Jesus
received a memorandum from Pioneers personnel manager requiring her to explain
why no disciplinary action should be taken against her for dishonesty and tampering
of official records and documents with the intention of cheating as P.O. No. 3853
allegedly required no trimming. The memorandum also placed her under preventive
suspension for 30 days. In her handwritten explanation, she maintained that she
merely committed a mistake in trimming P.O. No. 3853 as it had the same style and
design as P.O. No. 3824 which has an attached price list for trimming the ribs and
admitted that she may have been negligent in presuming that the same work was
to be done with P.O. 3853, but not for dishonesty or tampering. Pioneer nonetheless
terminated her from employment and sent her a notice of termination upon expiry
of her preventive suspension.

De Jesus then filed a complaint for illegal dismissal against Pioneer. The LA
noted that de Jesus was amply accorded procedural due process in her termination
from service; however, after observing that de Jesus made some further trimming
on P.O. No. 3853 and that her dismissal was not justified, the LA held Pioneer of
illegal dismissal and ordered Pioneer to reinstate de Jesus to her former position
with payment of full backwages. The NLRC ruled that de Jesus was negligent in
presuming that the ribs of P.O. No. 3853 should likewise be trimmed for having the
same style and design as P.O. No. 3824, thus Pioneer could not entirely be faulted
for dismissing de Jesus. The NLRC declared that the status quo between the parties
should be maintained and affirmed the LAs order of reinstatement, but without

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backwages. The NLRC further directed Pioneer to pay de Jesus her back salaries
from the date she filed her motion for execution up to the date of the promulgation
of the decision. Pioneer filed a partial motion for reconsideration which the NLRC
denied. Pioneer filed a petition to the SC, anchored substantially on the NLRCs
alleged error in holding that de Jesus is entitled to reinstatement and backwages,
because it claims that de Jesus was not illegally dismissed in the first place. Pioneer
also claims that an order for reinstatement is not self-executory and stresses that
there must be a writ of execution which may be issued by the NLRC or by the LA
motu proprio or on motion of an interested party. It further maintains that even if a
writ of execution was issued, a timely appeal coupled by the posting of an
appropriate supersedeas bond, which it did in this case, effectively forestalled and
stayed execution of the reinstatement order of the LA.

Issue: W/N an order for reinstatement needs a writ of execution.

Ruling: NO. Article 223 of the Labor Code expressly provides that insofar as
the reinstatement aspect is concerned, shall be immediately be executory, even
pending appeal The posting of a bond by the employer shall not stay the
execution for reinstatement provided. It must be construed to mean exactly what it
says. In declaring that a reinstatement order is not self-executory and needs a writ
of execution, the SC in a prior case adverted to the rule provided under Article 224.
A closer examination, however, shows that the necessity for a writ of execution
under Article 224 applies only to final and executory decisions which are not within
the coverage of Article 223. Article 224 states that the need for a writ of execution
applies only within five years from the date of a decision, an order or award
becomes final and executory. It cannot relate to an award or order of reinstatement
still to be appealed or pending appeal which Article 223 contemplates. The provision
of Article 223 is clear that an award for reinstatement shall be immediately
executory even pending appeal and the posting of a bond by the employer shall not
stay the execution for reinstatement. The legislative intent is quite obvious, i.e., to
make n award of reinstatement immediately enforceable, even pending appeal. To
require the application for and issuance of a writ of execution as prerequisites for
the execution of a reinstatement award would certainly betray and run counter to
the very object and intent of Article 223, i.e., the immediate execution of a
reinstatement order. The reason is simple. An application for a writ of execution and
its issuance could be delayed for numerous reasons. A mere continuance or
postponement of a scheduled hearing, for instance, or inaction on the part of the LA
or the NLRC could easily delay the issuance of the writ thereby setting at naught the
strict mandate and noble purpose envisioned by the said Article. In other words, if
the requirements of Article 224 were to govern, then the executory nature of a
reinstatement order or award contemplated in Article 223 will be unduly
circumscribed and rendered ineffectual. In enacting the law, the legislature is
presumed to have ordained a valid and sensible law, one which operates no further
than may be necessary to achieve its specific purpose.

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In ruling that an order or award for reinstatement does not require a writ of
execution, the Court is simply adhering and giving meaning to the rule that all
doubts in the interpretation and implementation of labor laws should be resolved in
favor of labor. Henceforth, it is ruled that an award or order for reinstatement is self-
executory. After receipt of the decision or resolution ordering the employees
reinstatement, the employer has a right to choose whether to re-admit the
employee to work under the same terms and conditions prevailing prior to his
dismissal or to reinstate the employee in the payroll. In either instance, the
employer has to inform the employee of his choice. The notification is based on
practical considerations for without notice, the employee has no way of knowing if
he has to report for work or not.

On appeal, however, the appellate tribunal concerned may enjoin or suspend


the reinstatement order in the exercise of its sound discretion.

Petition denied, LA decision is reinstated.

AIR PHILIPPINE CORPORATION v. ENRICO ZAMORA (GR No. 148247, 7 August 2006)
Austria-Martinez

Facts: Zamora was employed with AirPhil as a B-737 Flight Deck Crew. He applied
for promotion to the position of airplane captain and underwent the requisite
training program. After completing training, he inquired about his promotion but
AirPhil did not act on it; instead, it continued to give him assignments as flight deck
crew. Zamora then filed a complaint with the LA for constructive dismissal, arguing
that AirPhils act of withholding his promotion rendered his continued employment
with it oppressive and unjust. AirPhil denied that it dismissed Zamora, and stated
that when the complaint was filed, Zamora was still in its employ. It was only
subsequently that Zamora stopped reporting for work, not because he was forced to
resign, but because he had joined a rival airline, Grand Air.

The LA held AirPhil liable for constructive dismissal and ordered it to reinstate
Zamora as a B-737 captain without loss of seniority rights, and to pay full
backwages, moral and exemplary damages, and attorneys fees. Zamora
immediately filed a motion for execution of the order of reinstatement, which the LA
granted and issued a writ of execution. AirPhil, on the other hand, filed with the
NLRC an appeal assailing the LAs finding. The NLRC held that no dismissal,
constructive or otherwise, took place for it was Zamora himself who voluntarily
terminated his employment by not reporting for work and by joining a competitor.
Upon motion for reconsideration, the NLRC ordered AirPhil to pay Zamora his unpaid
salaries from the date AirPhil received the copy of the LA directing the
reinstatement of Zamora, until the time the NLRC reversed the same. AirPhil moved
for reconsideration, but it was denied.

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MACAPAGAL, STEPHANIE LUZETTE M. BSU COLLEGE OF LAW
AirPhil then filed a petition for certiorari with the CA to have the NLRCs
resolution partially annulled. AirPhil attached to its petition certified true copies of
the said resolutions and the prior decision of the LA, the notice of garnishment, the
Order of the LA authorizing the sheriff to implement the writ of execution, and the
NLRC resolution enjoining the implementation of the writ of execution. The CA
dismissed the same for AirPhils failure to attach copies of all pleadings and other
material portions of the record as would support the allegations therein. As such,
AirPhil filed a motion for reconsideration and attached to its pleadings and portions
of the case record required by the CA, while Zamora filed an opposition to the said
motion for reconsideration. The CA denied the motion for reconsideration on the
ground that AirPhil failed to dispute Zamoras opposition.

Issue 1: W/N the NLRC committed grave abuse of discretion in holding AirPhil
liable for unpaid salaries.

Ruling: NO. The premise of the award of unpaid salary to Zamora is that prior
to the reversal by the NLRC of the LAs decision, the order of reinstatement
embodied therein was already the subject of an alias writ of execution even pending
appeal. Although AirPhil did not comply with this writ of execution, its intransigence
made it liable nonetheless to the salaries of Zamora pending appeal.

Issue 2: W/N the CA committed grave abuse of discretion when it dismissed


AirPhils petition on the ground that it supposedly failed to attach copies of all
pleadings and other materials as would support the allegations therein.

Ruling: YES. It appears that the CA in this case was overzealous in its
enforcement of the rules. To begin with, the pleadings and other documents it
required of AirPhil were not at all relevant to the petition. It is noted that the only
issue raised by AirPhil was whether the NLRC committed grave abuse of discretion
in granting Zamora unpaid salaries while declaring him guilty of abandonment of
employment. Certainly, copies of the resolutions of the NLRC would have sufficed as
basis for the CA to resolve this issue. After all, it is in these resolutions that the
NLRC purportedly made contrary findings. There was no need at all for copies of the
position papers and other pleadings of the parties; these would have only cluttered
the docket. Besides, a summary of the material allegations in the position papers
can be found in the decision of the LA and the resolution of the NLRC. Quick
reference to copies of the decision and resolution would have already satisfied any
question the court may have had regarding the pleadings of the parties. The
attachments of AirPhil to its petition for certiorari were already sufficient even
without the pleadings and portions of the case record. It was therefore unreasonable
of the CA to have dismissed it. More so that AirPhil later corrected the purported
deficiency by submitting copies of the pleadings and other documents.

Issue 3: W/N the CA committed grave abuse of discretion in denying AirPhils


motion for reconsideration.

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MACAPAGAL, STEPHANIE LUZETTE M. BSU COLLEGE OF LAW
Ruling: YES. In its resolution, the CA cited as basis for denying AirPhils motion
for reconsideration the latters failure to contravene the opposition filed by Zamora.
This is certainly a curious ground to deny a motion for reconsideration. As pointed
out by AirPhil, a reply to an opposition to a motion for reconsideration is not filed as
a matter of course. An order from the court may issue though to direct the movant
to file a reply. In this case, no such order came from the CA instructing AirPhil to
counter the opposition filed by Zamora. Hence, it cannot be assumed that in failing
to file a reply, AirPhil, in effect, conceded to Zamoras opposition. Furthermore, it is
not as if Zamoras opposition required any answer. The matters discussed therein
were not even germane to the issue raised in the motion for reconsideration.

Petition granted. CA resolutions annulled and set aside; NLRC resolutions


affirmed.

Notes and Doctrines:

Paragraph 2, Section 1 of Rule 65, and Section 3, Rule 46 of the Rules of Court
speak of two sets of documents to be attached to the petition. The first set consists
of certified true copies of the judgment, order, or resolution subject of the petition.
Duplicate originals or certified true copies thereof must be appended to enable the
reviewing court to determine whether the court, body or tribunal, which rendered
the same committed grave abuse of discretion. The second set consists of the
pleadings, portions of the case record and other documents which are material and
pertinent to the petition. Mere photocopies thereof may be attached to the petition.

As a general rule, a petition lacking copies of essential pleadings and portions


of the case record may be dismissed. This rule, however, is not petrified. As the
exact nature of the pleadings and parts of the case record which must accompany a
petition is not specified, much discretion is left to the appellate court to determine
the necessity for copies of pleadings and other documents. There are, however,
guideposts it must follow: First, not all pleadings and parts of the case records are
required to be attached to the petition. Only those which are relevant and pertinent
must accompany it. The test of relevancy is whether the document in question will
support the material allegations in the petition, whether said document in question
will support the material allegations in the petition, whether said document will
make out a prima facie case of grave abuse of discretion as to convince the court to
give due course to the petition. Second, even if a document is relevant and
pertinent to the petition, it need not be appended if it is shown that the contents
thereof can also be found in another document already attached to the petition.
Thus, if the material allegations in a position paper are summarized in a questioned
judgment, it will suffice that only a certified true copy of the judgment is attached.
Third, a petition lacking an essential pleading or part of the case record may still be
given due course or reinstated (if earlier dismissed) upon showing that petitioner
later submitted the documents required, or that it will serve the higher interest of
justice that the case be decided on the merits.
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A petition for certiorari with the CA or the SC shall not stay the execution of
the assailed decision unless a restraining order is issued by said courts
(Section 4)

AM No. 07-7-12,4 December 2007: AMENDMENTS TO RULES 41, 45, 58, AND 65 0F
THE RULES OF COURT

RULE 65, Section 7. Expediting proceedings; injunctive relief. The court in which the
petition is filed may issue orders expediting the proceedings, and it may also grant
a temporary restraining order or a writ of preliminary injunction for the preservation
of the rights of the parties pending such proceedings. The petition shall not
interrupt the course of the principal case, unless a temporary restraining order or a
writ of preliminary injunction has been issued, enjoining the public respondent from
further proceeding with the case.

The public respondent shall proceed with the principal case within ten days
from the filing of a petition for certiorari with a higher court or tribunal, absent a
temporary restraining order or a preliminary injunction, or upon its expiration.
Failure of the public respondent to proceed with the principal case may be a ground
for an administrative charge.

o Where the executed judgment is totally or partially reversed or annulled


by the CA or the SC, the LA shall, on motion, issue such orders of
restitution of the executed award, except wages paid during reinstatement
pending appeal (Section 14)
Purely monetary awards: IF reversed, LA is required to issue an order
to restitute or to refund the same to the employer, except backwages
as a consequence of reinstatement pending appeal
o While there is a so-called courtesy rule (which probably states that
execution should be stayed while the case is on appeal), it is no longer
applicable

Q: The decision of the LA contains a provision for reinstatement pending appeal.


Complainant did not receive reinstatement wages; neither was he reinstated to his
old position. Subsequently, the decision was reversed. Is complainant still entitled to
the uncollected reinstatement wages?

A: It depends. If the employer is at fault, the complainant is entitled to receive


said uncollected reinstatement wages. Otherwise, he is no longer entitled to it.

ALEJANDRO ROQUERO v. PHILIPPINE AIRLINES (GR No. 152329, 22 April 2003) Puno

Facts: Alejandro Roquero and Rene Pabayo were ground equipment mechanics of
Philippine Airlines. They were caught red-handed possessing and using shabu in a
raid conducted by PAL security officers and NARCOM personnel. The two alleged
that they did not voluntarily indulge in the said act but were instigated by a certain
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Jojie Alipato who was introduced to them by the Manager of PALs Airport
Maintenance Division, who gave them the drugs immediately prior to the entrance
of the security and NARCOM personnel. Roquero and Pabayo were subjected to a
physical examination where the results showed that they were positive of drugs.
They were also brought to PALs security office where they executed written
confessions without the benefit of counsel.

Roquero and Pabayo subsequently received notices of administrative


charge for violating the PAL Code of Discipline. They were required to answer the
charges and were placed under preventive suspension. Roquero and Pabayo stuck
to their story of being instigated by Alipato, who had no record of employment with
PAL. PAL then dismissed the two employees through a Memorandum. They then
filed a case for illegal dismissal.

The LA upheld the dismissal of both employees, finding both parties at fault
PAL for applying means to entice both employees into committing the infraction and
the two employees for giving in to the temptation and eventually indulging in the
prohibited activity. Nonetheless, the LA awarded separation pay and attorneys fees
to the complainants. While the case was on appeal with the NLRC, the complainants
were acquitted by the RTC in the criminal case which charged them with
conspiracy for possession and use of a regulated drug on the ground of
instigation.

The NLRC ruled in favor of complainants as it likewise found PAL guilty of


instigation. It ordered reinstatement to their former positions but without
backwages. Complainants did not appeal from the decision but filed a motion for
writ of execution of the order of reinstatement. The LA granted the motion but PAL
refused to execute the said order on the ground that they have filed a petition for
review with the SC. PALs petition was referred to the CA. Pabayo then entered into
a compromise agreement and filed a motion to withdraw/dismiss the case with
respect to himself.

The CA later reversed the decision of the NLRC and reinstated the decision of
the LA insofar as it upheld the dismissal of Roquero. However, it denied the award of
separation pay and attorneys fees to Roquero on the ground that one who has been
validly dismissed is not entitled to those benefits.

Issue 1: Can the executory nature of the decision, more so the reinstatement
aspect of a labor tribunals order, be halted by a petition having been filed in higher
courts without any restraining order or preliminary injunction having been ordered
in the meantime?

Ruling: NO. Article 223 of the Labor Code, as amended by Section 12 of RA


6715, provide that an order of reinstatement by the LA is immediately executory
even pending appeal. Technicalities have no room in labor cases where the Rules of

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MACAPAGAL, STEPHANIE LUZETTE M. BSU COLLEGE OF LAW
Court are applied only in a suppletory manner and only to effectuate the objectives
of the Labor Code. Thus, even if the order of reinstatement of the LA is reversed on
appeal, it is obligatory on the part of the employer to reinstate and pay the wages
of the dismissed employee during the period of appeal until reversal by the higher
court. On the other hand, if the employee had been reinstated during the appeal
period and such reinstatement order is reversed with finality, the employee is not
required to reimburse whatever salary he received for he is entitled to such, more
so if he actually rendered services during the period.

Issue 2: Would the employer who refused to reinstate an employee despite a


writ duly issued be held liable to pay the salary of the subject employee from the
time that he was ordered reinstated up to the time that the reversed decision was
handed down?

Ruling: YES. The unjustified refusal of the employer to reinstate a dismissed


employee entitles him to payment of his salaries effective from the time the
employer failed to reinstate him despite the issuance of a writ of execution. Unless
there is a restraining order issued, it is ministerial upon the LA to implement the
order of reinstatement. In the case at bar, no restraining order was granted. Thus, it
was mandatory on PAL to actually reinstate Roquero or reinstate him in the payroll.
Having failed to do so, PAL must pay Roquero the salary he is entitled to, as if he
was reinstated, from the time of the decision of the NLRC until the finality of the
decision of the SC.

Dismissal of Roquero is affirmed, but PAL is ordered to pay the wages to


which Roquero is entitled from the time the reinstatement order was issued until the
finality of this decision.

Notes and Doctrines:

Serious misconduct is defined as the transgression of some established and


definite rule of action, a forbidden act, a dereliction of duty, willful in character, and
implies wrongful intent and not mere error in judgment. For serious misconduct to
warrant the dismissal of an employee, it (1) must be serious; (2) must relate to the
performance of the employees duty; and (3) must show that the employee has
become unfit to continue working for the employer.

Instigation is only a defense against criminal liability. It cannot be used as a


shield against dismissal from employment especially when the position involves the
safety of human lives.

JUANITO GARCIA & ALBERTO DUMAGO v. PHILIPPINE AIRLINES (GR No. 164856, 20
January 2009) Carpio Morales

Facts: Juanito Garcia and Alberto Dumago were administratively charged by PAL
after they were allegedly caught in the act of sniffing shabu when a team of
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MACAPAGAL, STEPHANIE LUZETTE M. BSU COLLEGE OF LAW
company security personnel and law enforcers raided the PAL Technical Centers
Toolroom Section. After due notice, PAL dismissed the two for transgressing the PAL
Code of Discipline, prompting the latter to file a complaint for illegal damages. The
LA ruled against PAL, ordering the same to immediately comply with the
reinstatement aspect of the decision.

Prior to the promulgation of the LAs decision, the SEC placed PAL, which was
suffering from severe financial losses, under an Interim Rehabilitation Receiver, who
was subsequently replaced by a Permanent Rehabilitation Receiver. From the LAs
decision, PAL appealed to the NLRC. NLRC reversed the LA decision and dismissed
Garcia and Dumagos complaint for lack of merit. Their motion for reconsideration
was denied and an entry of judgment was issued.

The LA subsequently issued a writ of execution respecting the reinstatement


aspect of his decision, and he subsequently issued a notice of garnishment. PAL
moved to quash the writ and to lift the notice, while Garcia and Dumago moved to
release the garnished amount. PAL also filed an urgent petition for injunction with
the NLRC, which affirmed the validity of the writ and the notice issued by the LA but
suspended and referred the action to the Rehabilitation Receiver for appropriate
action. PAL then elevated the matter to the CA which nullified the NLRC decision on
two grounds, essentially espousing that: (1) a subsequent finding of a valid
dismissal removes the basis for implementing the reinstatement aspect of an LAs
decision; and (2) the impossibility to comply with the reinstatement order due to
corporate rehabilitation provides a reasonable justification for the failure to exercise
the options under Article 223 of the Labor Code. The SC then partially granted PALs
petition and effectively reinstated the NLRC resolution insofar as it suspended the
proceedings, their claims being money claims for wages. The SC then stated that
the LA, the NLRC, as well as the CA should have abstained from resolving their case
for illegal dismissal and should instead have directed them to lodge their claim
before PALs receiver. When PALs rehabilitation proceedings were terminated, the
SC resolved the remaining issue for consideration.

Issue 1: W/N Garcia and Dumago may collect their wages during the period
between the LAs order of reinstatement pending appeal and the NLRC decision
overturning that of the LA, now that PAL has exited from rehabilitation proceedings.

Ruling: NO. The peculiar predicament of a corporate rehabilitation rendered it


impossible for PAL to exercise its option under the circumstances. The legal effects
arising from a judicial order placing a corporation under rehabilitation includes the
effective deprivation of the corporations choices under Article 223 of the Labor
Code, not only by virtue of the statutory injunction but also in view of the interim
relinquishment of management control to give way to the full exercise of the powers
of the rehabilitation receiver. Had there been no need to rehabilitate, PAL may have
opted to physical reinstatement pending appeal to optimize the utilization of
resources. Then again, though the management may think this wise, the
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rehabilitation receiver may decide otherwise, not to mention the subsistence of the
injunction on claims.

In the case at bar, Garcia and Dumago exerted efforts to execute the LAs
order of reinstatement until they were able to secure a writ of execution, albeit
issued after the reversal by the NLRC of the LAs decision. Technically, there was still
actual delay which brings to the question of whether the delay was due to PALs
unjustified act or omission. It is apparent that there was inaction on the part of PAL
to reinstate them, but whether such omission was justified depends on the onset of
the exigency of corporate rehabilitation.

It is settled that upon appointment by the SEC of a rehabilitation receiver, all


actions for claims before any court, tribunal or board against the corporation shall
ipso jure be suspended. During the pendency of Garcia and Dumagos complaint
before the LA, the SEC placed PAL under an Interim Rehabilitation Receiver. After
the LA rendered his decision, the SEC replaced the Interim Rehabilitation Receiver
with a Permanent Rehabilitation Receiver. Case law recognizes that unless there is a
restraining order, the implementation of the order of reinstatement is ministerial
and mandatory. The injunction or suspension of claims by legislative fiat partakes of
the nature of a restraining order that constitutes a legal justification for PALs non-
compliance with the reinstatement order. PALs failure to exercise the alternative
options of actual reinstatement and payroll reinstatement was thus justified. Such
being the case, PALs obligation to pay the salaries pending appeal, as the normal
effect of the non-exercise of the options, did not attach. While reinstatement
pending appeal aims to avert the continuing threat or danger to the survival or even
the life of the dismissed employee and his family, it does not contemplate the
period when the employer-corporation itself is similarly in a judicially monitored
state of being resuscitated in order to survive.

Petition partially denied.

Notes and Doctrines:

A dismissed employee whose case was favorably decided by the LA is


entitled to receive wages pending appeal upon reinstatement, which is immediately
executory. Unless there is a restraining order, it is ministerial upon the LA to
implement the order of reinstatement and it is mandatory on the employer to
comply therewith. The employer has to either re-admit the dismissed employee to
work under the same terms and conditions prior to his dismissal, or to reinstate him
in the payroll, during the period of appeal until reversal by the higher court. Failing
to exercise the options in the alternative, the employer must pay the employees
salaries.

The social justice principles of labor law outweigh or render inapplicable the
civil law doctrine of unjust enrichment.

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The new NLRC Rules of Procedure now require the employer to submit a
report of compliance within 10 calendar days from receipt of the LAs decision,
disobedience to which clearly denotes a refusal to reinstate. The employee need not
file a motion for the issuance of the writ of execution since the LA shall thereafter
motu proprio issue the writ. With the new rules in place, there is hardly any difficulty
in determining the employers intransigence in immediately complying with the
order.

After the LAs decision is reversed by a higher tribunal, the


employee may be barred from collecting the accrued wages, if it is shown
that the delay in enforcing the reinstatement pending appeal was without
fault on the part of the employer. The test is two-fold: (1) There must be actual
delay or the fact that the order of reinstatement pending appeal was not executed
prior to its reversal; and (2) The delay must not be due to the employers unjustified
act or omission. If the delay is due to the employers unjustified refusal, the
employer may still be required to pay the salaries notwithstanding the reversal of
the LAs decision.

The parallelism between a judicial order of corporation rehabilitation as a


justification for the non-exercise of its options, on the one hand, and a claim of
actual and imminent substantial losses as a ground for retrenchment, on the other
hand, stops at the red line on the financial statements. Unlike the ground of
substantial losses contemplated in a retrenchment case, the state of corporate
rehabilitation is judicially predetermined by a competent court.

The Commission or the LA may schedule a pre-execution conference to


thresh out relevant to execution including the final computation of monetary
award within two working days from receipt of a motion for the issuance of a
writ of execution. The writ of execution shall be accompanied by a
computation of a judgment award, if necessary. (Section 5, par. 1)
o The pre-execution conference shall not exceed 15 calendar days from the
initial schedule, unless the parties agree to an extension (Section 5, par.
1)
o Any order issued by the LA in the pre-execution conference is not
appealable, subject to the remedies available under Rule XII (Section 5,
par. 2)
The writ of execution shall issue in the name of the Republic of the Philippines
(Section 6)
Contents of the Writ of Execution (Section 6, par. 1):
o Signature of the Commission or Labor Arbiter
o Order of Commission or LA to the Sheriff to execute the decision, order, or
award
o Complete name of the party, whether natural or juridical, against whom
the writ of execution was issued
o Dispositive portion of the decision, order, or award to be enforced
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o The amount, if any, to be demanded, and all legal fees to be collected
from the losing party or any other person required by law to obey the
same
The Sheriff or other authorized officer acting as Sheriff of the Commission
shall serve the writ within three days from receipt of the same (Section 7)
o The Sheriff shall enforce a monetary judgment by demanding the
immediate payment of the full amount stated in the writ of execution and
all legal fees from the losing party or any other person required by law to
obey the same (Section 8a)
In event of failure or refusal of the losing party to pay the judgment
award, the Sheriff shall immediately proceed against the cash deposit
or surety bond posted by the losing party, if any (Section 8b)
If the bonding company refuses to pay or the bank holding the cash
deposit of the losing party refuses to release the garnished amount
despite the order or pertinent processes issued by the LA or the
Commission, the president or responsible officers or authorized
representatives of the said bonding company or the bank who
resisted or caused such non-compliance shall be either cited for
contempt, or held liable for resistance and disobedience to a person
in authority or the agents of such person as provided under the
RPC; this rule shall likewise apply to any person or party who
unlawfully resists or refuses to comply with the break open order
issued by the LA or the Commission. A bonding company cited for
contempt, or for an offense defined and punishable under the RPC
shall be barred from transacting business with the Commission
(Section 8c)
Should the cash deposit or surety bond be insufficient, or in case
the surety bond cannot be proceeded against for any reason, the
Sheriff shall, within five days from demand, execute the monetary
judgment by garnishing bank deposits, credits, receivables, and
other personal property not capable of manual delivery. If the same
is not enough, proceed to levy the personal property of the losing
party, and if still insufficient, against the real property not exempt
from execution, sufficient to cover the judgment award, which may
be disposed of for value at a public auction to the highest bidder
(Section 8d) proceeds of execution shall be deposited with the
Cashier of the concerned Division or RAB, or with an authorized
depositary bank. Where payment is made in the form of a check the
same shall be payable to the Commission (Section 8e)

Levy: To impose or assess (a fine or a tax) by legal authority; To take or seize


property in execution of a judgment (Blacks Law Dictionary); The seizure according
to a writ of execution of real or personal property in a judgment debtors possession
to satisfy a judgment debt (Merriam-Websters Dictionary of Law)
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Garnishment: A judicial proceeding in which a creditor (or potential creditor) asks
the court to order a third party who is indebted to or is bailee for the debtor to turn
over to the creditor any of the debtors property (such as wages or bank accounts)
held by that third party (Blacks Law Dictionary); A remedial device used by a
creditor to have property of the debtor or money owed to the debtor that is in the
possession of a third party attached to pay the debt to the creditor (Merriam-
Websters Dictionary of Law)

Judgment: A courts final determination of the rights and obligations of the parties in
a case. Includes an equitable decree and any order from which an appeal lies
(Blacks Law Dictionary); A formal decision or determination on a matter or case by
a court (Merriam-Websters Dictionary of Law)

Property Exempt From Execution:

1. Present Property Articles 152, 155, and 205 of the Family Code; Section 13,
Rule 39 of the Rules of Court; Section 118 of CA 141
Art. 152. The family home, constituted jointly by the husband and the
wife or by an unmarried head of a family, is the dwelling house where
they and their family reside, and the land on which it is situated.
Art. 155. The family home shall be exempt from execution, forced sale,
or attachment except:
(1) For nonpayment of taxes;
(2) For debts incurred prior to the constitution of the family home;
(3) For debts secured by mortgages on the premises before or after
such constitution; and
(4) For debts due to laborers, mechanics, architects, builders,
materialmen and others who have rendered service or furnished
material for the construction of the building.

Art. 205. The right to receive support under this Title as well as any
money or property obtained as such support shall not be levied upon
on attachment or execution.

Rule 39, Section 13. Property exempt from execution. Except as


otherwise expressly provided by law, the following property, and no
other, shall be exempt from execution:

(a) The judgment obligors family home as provided by law, or the


homestead in which he resides, and land necessarily used in
connection therewith;
(b) Ordinary tools and implements personally used by him in his trade,
employment, or livelihood;
(c) Three horses, or three cows, or three carabaos, or other beasts of
burden such as the judgment obligor may select necessarily used
by him in his ordinary occupation;

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(d) His necessary clothing and articles for ordinary personal use, except
jewelry;
(e) Household furniture and utensils necessary for housekeeping, and
used for that purpose by the judgment obligor and his family, such
as the judgment obligor may select, of a value not exceeding
P100,000.00;
(f) Provisions for individual or family use sufficient for four months;
(g) The professional libraries and equipment of judges, lawyers,
physicians, pharmacists, dentists, engineers, surveyors, clergymen,
teachers, and other professionals, not exceeding P300,000.00 in
value;
(h) One fishing boat and accessories not exceeding the total value of
P100,000.00 owned by a fisherman and by the lawful use of which
he earns his livelihood;
(i) So much of the salaries, wages, or earnings of the judgment obligor
or his personal services within the four months preceding the levy
as are necessary for the support of his family;
(j) Lettered gravestones;
(k) Monies benefits, privileges, or annuities accruing or in any manner
growing out of any life insurance;
(l) The right to receive legal support, or money or property obtained as
such support, or any pension or gratuity from the Government;
(m) Properties specially exempt by law.

But no article or species of property mentioned in this section shall be


exempt from execution issued upon a judgment recovered for its price
or upon a judgment of foreclosure of a mortgage thereon.

2. Future Property Those related to the insolvency of a debtor


3. Property in custodial egis and of public dominion
If the property levied is claimed by any person other than the losing
party, such person may file a third party claim not later than five
days from the last day of posting or publication of the notice of
execution sale, otherwise the claim shall be forever barred (Section
11a); the said claim shall be filed with the Commission or LA where
the execution proceeding is pending, with proof of service of copies
thereof to the Sheriff and the prevailing party (Section 11b); and
shall automatically suspend the proceedings with respect to the
execution of the properties subject of the said claim (Section 11c)
o Requisites of a third party claim (Section 11a):
1. An affidavit stating title to property or right to the possession
thereof with supporting evidence;
2. Posting of a bond equivalent to the amount of the claim or
judgment award, whichever is lower; and
3. Payment of the prevailing fee.

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o Upon approval of the bond, the LA shall issue an order releasing
the levied property or a part thereof subject of the claim unless
the prevailing party posts a counterbond in an amount not less
than the value of the levied property (Section 11c, par. 2); the
LA may also require the posting of additional bond upon showing
by the other party that the bond is insufficient (Section 11c, par.
3)
o The propriety of the third party claims shall be resolved within
ten working days from submission of the claim for resolution.
The decision of the LA is not appealable but may be elevated to
the Commission and resolved in accordance with Rule XII.
Pending resolution thereof, execution shall proceed against all
other properties not subject of the third party claim. (Section
11d)
The issue NOT the resolution of ownership of the property
(cognizable by the RTC), but the resolution of the propriety of
the third party claim
For monetary judgment on cases involving OFWs, the manner of
execution shall be in accordance with RA 10022 (Section 8f)
o Immediately after full satisfaction of the judgment award, the writ of
execution shall be returned to the Commission or LA. In case of partial or
non-satisfaction of the judgment, the sheriff enforcing the writ shall
submit a report updating the Commission or LA who issued the writ of
execution on the status of the enforcement thereof, not later than 30 days
from receipt of such writ and every 30 days thereafter during the lifetime
of the writ unless fully satisfied (Section 12)
A copy of the report shall be furnished the Chairman and the Executive
LA
Failure on the part of the Sheriff to submit the report or return required
within the stated period shall subject him/her to administrative fine or
suspension for 15 days without pay, or both (Section 12, par. 2)
A motion to quash the writ of execution shall be resolved by the LA within 10
working days from submission of said motion for resolution. The mere filing of
a motion to quash shall not stay execution proceedings (Section 10)

RULE XII EXTRAORDINARY REMEDIES

A party aggrieved by any order or resolution of the LA including those issued


during execution proceedings may file a verified petition to annul or modify
such order or resolution. This petition may be accompanied by an application
for the issuance of a temporary restraining order and/or writ of preliminary or
permanent injunction to enjoin the LA, or any person acting under his/her
authority, to desist from enforcing said resolution or order (Section 1)

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o Except by way of a petition filed in accordance with this Rule, no appeal
from the order or resolution issued by the LA during the execution
proceedings or in relation to incidents other than a decision or disposition
of the case on the merits, shall be allowed or acted upon by the
Commission (Section 15)
o The LA shall be jointly impleaded with the private respondent as a public
respondent in a nominal capacity. It shall be the duty of the private
respondent to appear and defend, both in his/her behalf and that of the
public respondent and the cost awarded in such proceedings in favor of
the petitioner shall be against the private respondent only. The public
respondent shall not appear or file an answer or comment to the petition
or any pleading therein (Section 5)
o The writ of preliminary injunction shall be effective for a non-extendible
period of 60 calendar days from service on the private respondent
(Section 10, par. 1)
Grounds for issuance of Preliminary Injunction (Section 3, Rule 58 of
the Rules of Court).A preliminary injunction may be granted when it
is established:
(a) That the applicant is entitled to the relief demanded, and the whole
or part of such relief consists in restraining the commission or
continuance of the act or acts complained of, or in requiring the
performance of an act or acts, either for a limited period or
perpetually;
(b) That the commission, continuance, or nonperformance of the act or
acts complained of during the litigation would probably work
injustice to the applicant; or
(c) That a party, court, agency, or a person is doing, threatening, or is
attempting to do, or is procuring or suffering to be done, some act
or acts probably in violation of the rights of the applicant respecting
the subject of the action or proceeding, and tending to render the
judgment ineffectual.
o If it shall appear from the facts shown by the verified application and
affidavits that great and irreparable damage and/or injury would result to
the petitioner before the petition can be resolved, the Commission may
issue a temporary restraining order ex-parte effective for a non-extendible
period of 20 calendar days from service on the private respondent
(Section 10, par. 2)
o In the issuance of a temporary restraining order or writ of preliminary
injunction, the Commission shall require the posting of a cash bond in the
amount of P50,000.00, or such higher amount as may be determined by
the Commission, to recompense those enjoined for any loss, expense, or
damage caused by the improvident or erroneous issuance of such order or
injunction, including all reasonable costs. An additional cash bond may be

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required by the Commission in the issuance of a writ of preliminary
injunction. (Section 10, pars. 3 & 4)
The temporary restraining order or writ of preliminary injunction shall
become effective only upon posting of the required cash bond (Section
11, par. 1)
The cash bond cannot anymore be reacquired unless a permanent
injunction is issued
Grounds for issuance (Section 2):
o If there is prima facie evidence of abuse of discretion on the part of the LA
(Section 2a)
o If serious errors in the findings of facts are raised which, if not corrected,
would cause grave or irreparable damage or injury to the petitioner
(Section 2b)
o If a party by fraud, accident, mistake, or excusable negligence has been
prevented from taking an appeal (Section 2c)
o If made purely on questions of law (Section 2d)
o If the order or resolution will cause injustice if not rectified (Section 2e)
When filed: Not later than 10 calendar days from receipt of the order or
resolution of the LA (Section 3)
o If the last day to serve and file a pleading falls on a Saturday, Sunday, or
holiday, the pleading shall be served and filed on the first working day
immediately following such Saturday, Sunday, or holiday (Section 6, par.
2)
Where filed: Commission (Section 3)
o The party filing the pleadings shall serve the other party with copies
thereof in accordance with Rule 13 of the Rules of Court, furnishing the LA
with a copy (Section 6, par. 1)
Requisites (Section 4):
o Accompanied by a clear original or certified true copy of the order or
resolution assailed, together with clear copies of documents relevant or
related to the said order or resolution for the proper understanding of the
issue/s involved (Section 4a)
o Contain the arbitral docket number and appeal docket number, if any
(Section 4b)
o State the material date showing the timeliness of the petition (Section 4c)
o Be verified by the petitioner himself/herself (Section 4d)
o Be in the form of a memorandum which shall state the ground/s relied
upon, the arguments in support thereof, and the reliefs prayed for (Section
4e)
o Be in three legibly written or printed copies (Section 4f)
o Be accompanied by: (i) Certificate of non-forum shopping; (ii) Proof of
service upon the other party/ies and the LA who issued the order or
resolution being assailed or questioned; and (iii) Proof of payment of the
required fees (Section 4g)

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Upon filing of the petition, the proceedings before the LA shall continue
unless restrained. In case of execution, the proceedings in accordance with
Rule XI of these Rules shall be suspended, but no money collected or credit
garnished may be released or properties levied upon be sold by public
auction within 15 calendar days from the filing of the petition. If no temporary
restraining order or writ of preliminary injunction is issued within the said
period, the money collected or credit garnished shall be released and/or the
properties levied upon sold by public auction and the proceeds of the sale
applied, to satisfy the judgment (Section 9, par. 1). The issuance of a
temporary restraining order or a writ of preliminary injunction, unless
otherwise declared by the Commission, shall not suspend the proceedings
before the LA or stay the implementation of the writ of execution but shall
only restrain or enjoin such particular act/s as therein decreed to be
restrained or enjoined (Section 12)
o In case of execution proceedings, the LA shall immediately inform in
writing the Commission or the Division where the petition is pending of
the satisfaction of the judgment, and, if circumstances warrant, the
Commission shall dismiss the petition for being moot. (Section 9, par. 2)
o The records of the case shall not be elevated to the Commission unless
otherwise ordered (Section 9, par. 3)
Within 10 calendar days from the receipt of the petition, the private
respondent shall file his/her answer therein stating the ground/s why the
petition should be denied. Failure on the part of the private respondent to file
his/her answer within the said period may be construed as a waiver to file the
same (Section 7)
o In case the petitioner also prays for an injunctive relief, the private
respondent may file his/her verified opposition or comment to the
application for injunctive relief not later than five calendar days from
receipt of a copy of the petition (Section 8)
If the Commission finds that the allegations of the petition are true, it shall: a)
render judgment for the relief prayed for or to which the petitioner is entitled,
and/or b) grant a final injunction perpetually enjoining the LA or any person
acting under his/her authority from the commission of the act/s or confirming
the preliminary injunction. However, the Commission may dismiss the
petition if it finds the same to be patently without merit, prosecuted
manifestly for delay, or that the questions raised therein are too
unsubstantial to require consideration (Section 13)
o In the event that the application for a writ of preliminary injunction is
denied or not resolved within the said period (15 calendar days), the
temporary restraining order is deemed automatically vacated (Section 11,
par. 2)
o

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