Labor Cases Final

JUANITO A. GARCIA and ALBERTO J. DUMAGO vs.
PHILIPPINE
AIRLINES, INC.
Facts:
The case stemmed from the administrative charge filed by Philippine
Airlines (PAL) against its employees-herein petitioners after they were
allegedly caught in the act of sniffing shabu when a team of company security
personnel and law enforcers raided the PAL Technical Center’s Toolroom
Section on July 24, 1995.
After due notice, PAL dismissed petitioners for transgressing the PAL
Code of Discipline, prompting them to file a complaint for illegal dismissal
and damages which was resolved by the Labor Arbiter in their favor, thus
ordering PAL to, inter alia, immediately comply with the reinstatement aspect
of the decision.
Issue:
Whether or not the employees were subject to reinstatement.
Held:
The Court reaffirms the prevailing principle that even if the order of
reinstatement of the Labor Arbiter 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.
It settles the view that the Labor Arbiter’s order of reinstatement is

immediately executory and the employer has to either re-admit them to work
under the same terms and conditions prevailing prior to their dismissal, or to
reinstate them in the payroll, and that failing to exercise the options in the
alternative, employer must pay the employee’s salaries.
The Court sustains the appellate court’s finding that the peculiar
predicament of a corporate rehabilitation rendered it impossible for
respondent to exercise its option under the circumstances.
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 employer’s unjustified act or
omission. If the delay is due to the employer’s unjustified refusal, the
employer may still be required to pay the salaries notwithstanding the reversal
of the Labor Arbiter’s decision.
ST. MARTIN FUNERAL HOME vs. NATIONAL LABOR
RELATIONS COMMISSION and BIENVENIDO ARICAYOS
Facts:
Private respondent alleges that he started working as Operations
Manager of petitioner St. Martin Funeral Home on February 6, 1995.
However, there was no contract of employment executed between him and
petitioner nor was his name included in the semi-monthly payroll. On January
22, 1996, he was dismissed from his employment for allegedly
misappropriating P38,000.00. Petitioner on the other hand claims that private
respondent was not its employee but only the uncle of Amelita Malabed, the
owner of petitioner St. Martin’s Funeral Home and in January 1996, the
mother of Amelita passed away, so the latter took over the management of the
business. Amelita made some changes in the business operation and private
respondent and his wife were no longer allowed to participate in the
management thereof. As a consequence, the latter filed a complaint charging
that petitioner had illegally terminated his employment.
Issue:
Whether or not the decision of the NLRC are appealable to the Court
of Appeals.
RULING:
The Court is of the considered opinion that ever since appeals from the
NLRC to the SC were eliminated, the legislative intendment was that the
special civil action for certiorari was and still is the proper vehicle for judicial
review of decisions of the NLRC. The use of the word “appeal” in relation
thereto and in the instances we have noted could have been a lapsus plumae
because appeals by certiorari and the original action for certiorari are both
modes of judicial review addressed to the appellate courts. The important
distinction between them, however, and with which the Court is particularly
concerned here is that the special civil action for certiorari is within the
concurrent original jurisdiction of this Court and the Court of Appeals;
whereas to indulge in the assumption that appeals by certiorari to the SC are
allowed would not subserve, but would subvert, the intention of the Congress
as expressed in the sponsorship speech on Senate Bill No. 1495.
Therefore, all references in the amended Section 9 of B.P No. 129 to

supposed appeals from the NLRC to the Supreme Court are interpreted and
hereby declared to mean and refer to petitions for certiorari under Rule65.
Consequently, all such petitions should henceforth be initially filed in the
Court of Appeals in strict observance of the doctrine on the hierarchy of courts
as the appropriate forum for the relief desired.
TIRAZONA v. PHILIPPINE EDS TECHNO-SERVICE (PET) INC
Facts:
The petitioner, a managerial employee who was holding a position of
trust and confidence, was admonished by the latter of her improper handling
of a situation involving a rank-and-file employee. She admitted having read a
supposed confidential letter for the PET directors containing a legal opinion
of the respondent's counsel regarding the status of her employment. As a
consequence, she was terminated for willful breach of trust reposed upon by
her employer. She claimed having been denied of due process.
Issue:
Was her dismissal justified?
Held:
Yes. The petitioner has given the respondent more than enough reasons
to distrust her. The arrogance and hostility she has shown towards the
company her stubborn uncompromising stance in almost all instances justify
the company's termination of her employment.
UST Faculty Union v. Bitonio
Facts:
Private respondent Mariño et al are duly elected officers of UST
faculty. The union has a 5-year Collective Bargaining Agreement (CBA) with
its employer and is set to expire on May 31, 1998.
On September 21, 1996, Sec Gen of the Union posted a general

assembly announcement to be held on October 5, 1996. Various UST club
presidents requested a general faculty assembly; thus union and non-union
faculty members convened. New set of officers were elected, violative of the
CBL and that GA was held with the attendance of non-union members.
Current union officers were served with a notice to vacate the union
office as new set of offices were already elected. CBA was likewise ratified
by an overwhelming majority. Med-Arbiter declared the election conducted
as violative of the union’s CBL. BLR Director Bitonio upheld the decision
with a ruling that the CBL which constituted the covenant between the union
and its members could not be suspended during the general assembly of all
faculty members, since it had not been authorized by the union.
Issue:
Whether the officers “elected” during the general assembly should be

recognized.
Held:
Yes. Self-organization is a fundamental right guaranteed by the

constitution and labor Code. Corollary to this right is the prerogative not to
join, affiliate with or assist a labor union. Therefore, to become a union
member, an employee must not only signify the intent to become one but also
take some positive steps to realize that intent. The procedure for union
membership is usually embodied in the union’s CBL. An employee who
becomes a union member acquires the rights and the concomitant obligations
that go with the new status and becomes bound by the union’s rules and
regulations.
REYES vs. TRAJANO
FACTS:
The votes casted by the 141 Iglesia Ni Kristo (INK) members were
segregated and excluded from the final count in virtue of an agreement
between the competing unions, That INK members should not be allowed
to vote "because they are not members of any union and refused to
participate in the previous certification elections."
The Med-Arbiter saw no merit in the INK Employees petition. He

decided the fact that "religious belief was (being) utilized to render
meaningless the rights of the non-members of the Iglesia ni Kristo to
exercise the rights to be represented by a labor organization as the
bargaining agent," and declared the petitioners as "not possessed of any
legal personality to institute this present cause of action" since they were
not parties to the petition for certification election.
On appeal, Secretary Trajano opined that the petitioners are "bereft

of legal personality to protest their alleged disenfrachisement" since they
"are not constituted into a duly organized labor union, hence, not one of
the unions which vied for certification as sole and exclusive bargaining
representative." He also pointed out that the petitioners "did not participate
in previous certification elections in the company for the reason that their
religious beliefs do not allow them to form, join or assist labor
organizations."
ISSUES:
1. Whether or not INK members are disqualified to vote.
2. Whether or not the failure to participate in previous certification
election is a valid ground to deny subsequent participation.
HELD:
Neither law, administrative rule, nor jurisprudence requires that only
employees affiliated with any labor organization may take part in a
certification election. On the contrary, the plainly discernible intendment
of the law is to grant the right to vote to all bona fide employees in the
bargaining unit, whether they are members of a labor organization or not.
No law, administrative rule or precedent prescribes forfeiture of the

right to vote by reason of neglect to exercise the right in past certification
elections. In denying the petitioners' right to vote upon these egregiously
fallacious grounds, the public respondents exercised their discretion
whimsically, capriciously and oppressively and gravely abused the same.
HERITAGE HOTEL MANILA vs. PIGLAS
FACTS:
Sometime in 2000, certain rank and file employees of petitioner
Heritage Hotel Manila formed the “Heritage Hotel Employees Union” (the
HHE union). The Department of Labor and Employment-National Capital
Region (DOLE-NCR) later issued a certificate of registration to this union.
The HHE union filed a petition for certification election that petitioner
opposed. The company alleged that the HHE union misrepresented itself
to be an independent union, when it was, in truth, a local chapter of the
National Union of Workers in Hotel and Restaurant and Allied Industries
(NUWHRAIN).
PIGLAS union filed a petition for certification election that

petitioner also opposed, alleging that the new union’s officers and
members were also those who comprised the old union. According to the
company, the employees involved formed the PIGLAS union to
circumvent the Court of Appeals’ injunction against the holding of the
certification election sought by the former union.
ISSUES:
(1) Whether or not the union made fatal misrepresentation in
its application for union registration
(2) Whether or not dual unionism is a ground for cancelling a
union’s registration
HELD:
No, Respondent PIGLAS union’s organization meeting lasted for 12
hours. It was possible for the number of attendees to have increased from
90 to 128 as the meeting progressed. Besides, with a total of 250
employees in the bargaining unit, the union needed only 50 members to
comply with the 20 percent membership requirement. Thus, the union
could not be accused of misrepresentation since it did not pad its
membership to secure registration.
No. The fact that some of respondent PIGLAS union’s members

were also members of the old rank and file union, the HHE union, is not a
ground for canceling the new union’s registration. The right of any person
to join an organization also includes the right to leave that organization
and join another one. Besides, HHE union is dead. It had ceased to exist
and its certificate of registration had already been cancelled. Thus,
petitioner’s arguments on this point may also be now regarded as moot and
academic.
CENTRAL NEGROS ELECTRIC COOPERATIVE, INC.
(CENECO) vs SEC OF LABOR and CENECO UNION
OFRATIONAL EMPLOYEES (CURE)
FACTS:
On August 15, 1987, CENECO entered into a collective bargaining
agreement with CURE, a labor union representing its rank-and-file
employees for a term of three years retroactive to April 1, 1987 and
extending up to March 31, 1990.-On December 28, 1989, CURE wrote
CENECO proposing that negotiations be conducted for a new collective
bargaining agreement. CENECO denied CURE's request on the ground
that employees who at the same time are members of an electric
cooperative are not entitled to form or join a union.
CENECO filed a motion to dismiss to the effect that "employees who

at the same time are members of an electric cooperative are not entitled
to form or join unions for purposes of collective bargaining agreement, for
certainly an owner cannot bargain with himself or his co-owners." Med-
Arbiter Felizardo T. Serapio issued an order granting the petition for
certification election in effect, was a denial of CENECO's motion to
dismiss, and directing the holding of a certification election between
CURE and No Union. CENECO appealed to the Department of Labor and
Employment which issued the questioned order modifying the order of the
med-arbiter by directly certifying CURE as the exclusive bargaining
representative of the rank-and-file employees of CURE.
ISSUE:
Whether or not the employees of CENECO who withdrew their
membership from the cooperative are entitled to form or join CURE for
purposes of the negotiations for a collective bargaining agreement proposed
by the latter.
HELD:
The right of the employees to self-organization is a compelling reason
why their withdrawal from the cooperative must be allowed. As pointed out
by CURE, the resignation of the member- employees is an expression of their
preference for union membership over that of membership in the cooperative.
The avowed policy of the State to afford fall protection to labor and to promote
the primacy of free collective bargaining mandates that the employees’ right
to form and join unions for purposes of collective bargaining be accorded the
highest consideration.
Thus, member employees of a cooperative may withdraw as members

of the cooperative in order to join labor union. Membership in a cooperative
is voluntary; inherent in it is the right not to join.
KAPATIRAN SA MEAT AND CANNING vs CALLEJA
FACTS:
From 1984 to 1987 TUPAS was the sole and exclusive collective
bargaining representative of the workers in the Meat and Canning Division
of the Universal Robina Corporation.Within the freedom period of 60 days
prior to the expiration of its CBA, TUPAS filed an amended notice of strike
as a means of pressuring the company to extend, renew, or negotiate a new
CBA with it.
The NEW ULO, composed mostly of workers belonging to the

IGLESIA NI KRISTO sect, registered as a labor union, filed a petition for
a certification election at the Bureau of Labor Relations.
TUPAS moved to dismiss the petition for being defective in form

and that the members of the NEW ULO were mostly members of the
Iglesia ni Kristo sect which three (3) years previous refused to affiliate
with any labor union. It also accused the company of using the NEW ULO
to defeat TUPAS’ bargaining rights.
The Med-Arbiter ordered the holding of a certification election

within 20 days. TUPAS appealed to the Bureau of Labor Relations (BLR)
and was able to negotiate a new 3-year CBA with ROBINA. Respondent
BLB Director Calleja dismissed the appeal.
ISSUE:
Whether or not the public respondent erred in affirming the Med-
Arbiter’s order for a certification of election.
HELD:
The public respondent did not err in dismissing the petitioner’s
appeal in BLR Case No. A-12-389-87. in Victoriano v. Elizalde Rope
Workers’ Union, upholding the right of members of the IGLESIA NI
KRISTO sect not to join a labor union for being contrary to their religious
beliefs, does not bar the members of that sect from forming their own
union. The public respondent correctly observed that the "recognition of
the tenets of the sect . . . should not infringe on the basic right of self-
organization granted by the constitution to workers, regardless of religious
affiliation."
The fact that TUPAS was able to negotiate a new CBA with
ROBINA within the 60-day freedom period of the existing CBA, does not
foreclose the right of the rival union, NEW ULO, to challenge TUPAS’
claim to majority status, by filing a timely petition for certification election
on October 13, 1987 before TUPAS’ old CBA expired on November 15,
1987 and before it signed a new CBA with the company on December 3,
1987.
FEU-DR. NICANOR REYES MEDICAL FOUNDATION, INC.
vs. TRAJANO
FACTS:
The petitioner, Far Eastern University-Dr. Nicanor Reyes Memorial
Foundation, Inc., has a work force of about 350 rank and file employees,
majority of whom are members of private respondent Alliance of Filipino
Workers.
On February 13, 1986, private respondent filed a Petition for

Consent and/or Certification Election with The Ministry of Labor and
Employment. The petitioner opposed the petition on the ground that a
similar petition involving the same issues and the same parties is pending
resolution before the Supreme Court, private respondent filed a similar
petition for certification election with the Ministry of Labor and
Employment but the petition was denied on the ground that the petitioner
was a non-stock, non-profit medical institution, therefore, its employees
may not form, join, or organize a union pursuant to Article 244 of the Labor
Code.
Private respondent filed a petition for certiorari with the Supreme

Court assailing the constitutionality of Article 244 of the Labor Code.
ISSUE:
Whether or not rank and file employees of non-profit organization
are covered by the right to self-organization.
HELD:
YES. At the time private respondent filed its petition for certification
election on February 13, 1986, Article 244 of the Labor Code was already
amended by Batas Pambansa Bilang 70, to wit:
Art. 244. Coverage and employees’ right to self-organization. — All

persons employed in commercial, industrial and charitable, medical or
educational institutions whether operating for profit or not, shall have the
right to self-organizations of their own choosing for purposes of collective
$bargaining. Ambulant intermittent and itinerant workers, self-employed
people, rural workers and those without any definite employers may form
labor organizations for the purpose of enhancing and defending their
interests and for their mutual aid and protection.
Under the afore quoted provision, there is no doubt that rank and file
employees of non-profit medical institutions (as herein petitioner) are now
permitted to form, organize or join labor unions of their choice for
purposes of collective bargaining. Since private respondent had complied
with the requisites provided by law for calling a certification election, it
was incumbent upon respondent Director to conduct such certification
election to ascertain the bargaining representative of petitioner’s
employees.
TOYOTA MOTORS PHILIPPINES CORPORATION LABOR
UNION vs. TOYOTA MOTOR PHILIPPINES CORPORATION
EMPLOYEES AND WORKERS UNION, TOYOTA MOTOR
PHILIPPINES CORPORATION
FACTS:
TMPCEWU filed a Petition for Certification Election before the
Med-Arbitration Unit of the DOLE-National Capital Region seeking to
represent the rank-and-file employees of the manufacturing division.
Petitioner filed a motion to intervene and claims that the petition was
premature due to an earlier resolution by the Secretary of Labor ordering
the conduct of a certification election among the rank-and-file employees
of TMPC represented by petitioner which was the subject of certiorari
proceedings before the Supreme Court and still awaiting final resolution at
the time; and, that the collective bargaining unit which respondent
TMPCEWU sought to represent violated the "single or employer" unit
policy since it excluded the rank-and-file employees in the other divisions
and departments in respondent TMPC.
The Med-Arbiter rendered a decision dismissing for lack of merit

TMPCEWU's Petition for Certification Election, since it failed to include
all rank-and-file employees from Levels 1 to 4 in other departments of
TMPC in violation of the "one-union in one-company" policy and
likewise dismissing TMPCLU's Petition-in-Intervention for lack of legal
personality.
ISSUES:
1. Whether TMPCLU has the legal personality to file the Petition-
in-Intervention.
2. Whether or not the appellant has legal authority to oppose the
instant petition.
HELD:
The registration certificate issued by the Department of Labor and
Employment is void ab initio because at the time of the issuance the
constitution of intervenor union TMPCLU is (sic) a mixture of supervisory
and rank-and-file employees as per finding of fact of Med-Arbiter Paterno
Adap.
Petitioner had no valid certificate of registration and therefore no

legal personality to file the Petition for Certification Election and in the
absence of any attempt on its part to rectify the legal infirmity, likewise
the disputed Petition-in-Intervention.
MANILA ELECTRIC V SEC OF LABOR
FACTS:
Signo was employed in Meralco as supervisor-leadman since Jan 1963.In
1981, he supervised the installation of electricity in de Lara’s house in
Antipolo. De Lara’s house was not yet within the required 30-meter distance
from the Meralco facility hence he is not yet within the service scope of
Meralco. As a workaround, Signo had it be declared that a certain sarisari store
nearer the facility be declared as de Lara’s so as to facilitate the installation.
Everything would have been smooth thereafter but due to fault of the Power
Sales Division of Meralco, de Lara was not billed for a year. Investigation was
conducted and Meralco found out the irregularity in Signo’s work on de Lara’s
electricity installation.
Signo was dismissed on May 18, 1983. Signo filed a case for illegal
dismissal and for backwages. The Lanor Arbiter ruled that though there is a
breach of trust in the actuations of Signo dismissal is a harsh penalty as Signo
has been employed for more than 20 years by Meralco and has been
commended twice before for honesty. The NLRC affirmed the Labor Arbiter.
Meralco appealed.
ISSUE:
Whether or not there has been due process in the dismissal of Signo.
HELD:
The SC sustained the decision of the NLRC. Well-established is the
principle that findings of administrative agencies which have acquired
expertise because their jurisdiction is confined to specific matters are
generally accorded not only respect but even finality. Judicial review by this
Court on labor cases does not go so far as to evaluate the sufficiency of the
evidence upon which the proper labor officer or office based his or its
determination but is limited to issues of jurisdiction or grave abuse of
discretion. Notwithstanding the existence of a valid cause for dismissal, such
as breach of trust by an employee, nevertheless, dismissal should not be
imposed, as it is too severe a penalty if the latter has been employed for a
considerable length of time in the service of his employer. Reinstatement of
respondent Signo is proper in the instant case, but without the award of
backwages, considering the good faith of the employer in dismissing the
respondent.
SAN MIGUEL CORPORATION SUPERVISORS AND EXEMPT
UNION AND ERNESTO L. PONCE vs. HONARABLE BIENVENIDO
E. LAGUESMA, HONORABLE DANILO L. REYNANTE
FACTS:
Petitioner union filed before the Department of Labor and Employment
(DOLE) a Petition for District Certification or Certification Election among
the supervisors and exempt employees of the SMC Magnolia Poultry Products
Plants of Cabuyao, San Fernando and Otis.
Med-Arbiter Reynante issued an Order ordering the conduct of

certification among the supervisors and exempt employees of the SMC
Magnolia Poultry Products Plants of Cabuyao, San Fernando and Otis as one
bargaining unit.
The public respondent, granted respondent company’s Appeal and

ordered the remand of the case to the Med-Arbiter of origin for determination
of the true classification of each of the employees sought to be included in the
appropriate bargaining unit.
Undersecretary Laguesma granted the reconsideration prayed for on

September 3, 1991 and directed the conduct of separate certification elections
among the supervisors ranked as supervisory levels 1 to 4 (S1 to S4) and the
exempt employees in each of the three plants at Cabuyao, San Fernando and
Otis.
ISSUES:
(1) Whether Supervisory employees 3 and 4 and the exempt employees
of the company are considered confidential employees, hence
ineligible from joining a union.
(2) If they are not confidential employees, do the employees of the three
plants constitute an appropriate single bargaining unit.
HELD:
On the first issue, The Court ruled that said employees do not fall within
the term “confidential employees” who may be prohibited from joining a
union.
Supervisors 3 and above may not be considered confidential employees
merely because they handle “confidential data” as such must first be strictly
classified as pertaining to labor relations for them to fall under said
restrictions. The information they handle are properly classifiable as technical
and internal business operations data which, to our mind, has no relevance to
negotiations and settlement of grievances wherein the interests of a union and
the management are invariably adversarial. Since the employees are not
classifiable under the confidential type, they may appropriately form a
bargaining unit for purposes of collective bargaining.
METROLAB INDUSTRIES, INC vs. HONORABLE MA. NIEVES
ROLDAN-CONFESOR
FACTS:
On 31 December 1990, the Collective Bargaining Agreement (CBA)
between Metrolab and the Union expired. The negotiations for a new CBA,
however, ended in a deadlock.
The Union filed a notice of strike against Metrolab and Metro Drug
Inc. The parties failed to settle their dispute despite the conciliation efforts of
the National Conciliation and Mediation Board.
The Secretary of Labor assume jurisdiction over the entire labor dispute
and ordered the parties involved to execute a new CBA.Thereafter, the Union
filed a motion for reconsideration.
Acting Labor Secretary Nieves Confesor issued a resolution declaring

the layoff of Metrolab’s 94 rank and file workers illegal and ordered their
reinstatement with full backwages.
ISSUES:
1. Whether or not public respondent Labor Secretary committed
graveabuse of discretion and exceeded her jurisdiction in declaring
the subject layoffs instituted by Metrolab illegal on grounds that
these unilateral actions aggravated the conflict.
2. Whether or not the exclusion of confidential employees from
bargaining unit is discriminatory.
HELD:
The Union’s assurances fail to convince. The dangers sought to be
prevented, particularly the threat of conflict of interest and espionage, are not
eliminated by non-membership of Metrolab’s executive secretaries or
confidential employees in the Union. Forming part of the bargaining unit, the
executive secretaries stand to benefit from any agreement executed between
the Union and Metrolab. Such a scenario, thus, gives rise to a potential
conflict between personal interests and their duty as confidential employees
to act for and in behalf of Metrolab. They do not have to be union members
to affect or influence either side.
Confidential employees cannot be classified as rank and file. As

previously discussed, the nature of employment of confidential employees is
quite distinct from the rank and file, thus, warranting a separate
category. Excluding confidential employees from the rank and file bargaining
unit, therefore, is not tantamount to discrimination
STANDARD CHARTERED BANK EMPLOYEES UNION (SCBEU-
NUBE) vs STANDARD CHARTERED BANK
FACTS:
The 1998-2000 Collective Bargaining Agreement between the
Standard Chartered Bank employees Union and the Standard Chartered Bank
expired so the parties tried to renew it but then a deadlock ensued.
But then in the renewal sought by SCBEU-NUBE, they only wanted

the exclusion to apply only to the following employees from the appropriate
bargaining unit – all managers who are vested with the right to hire and fire
employees, confidential employees, those with access to labor relations
materials, Chief Cashiers, Assistant Cashiers, personnel of the Telex
Department and one Human Resources (HR) staff. SCBEU-NUBE also
averred that employees assigned in an acting capacity for at least a week
should be given salary raise.
A notice of strike was given to the Department of Labor due to this

deadlock. Then DOLE Secretary Patricia Sto. Tomas issued an order
dismissing the Union’s plea.
ISSUE:
Whether or not the confidential employees sought to be removed from
the exclusion as appropriate bargaining unit by SCBEU-NUBE holds ground.
HELD:
No, Whether or not the employees sought to be excluded from the
appropriate bargaining unit are confidential employees is a question of fact,
which is not a proper issue in a petition for review under Rule 45 of the Rules
of Court. SCBEU-NUBE insists that the foregoing employees are not
confidential employees; however, it failed to buttress its claim. Aside from its
generalized arguments and despite the Secretary’s finding that there was no
evidence to support it, SCBEU-NUBE still failed to substantiate its claim.
SCBEU-NUBE did not even bother to state the nature of the duties and
functions of these employees, depriving the Court of any basis on which it
may be concluded that they are indeed confidential employees.
With regards to the salary increase of employees in acting capacities,

the Supreme Court agreed with the Court of Appeals that a restrictive
provision would curtail management’s prerogative, and at the same time,
recognized that employees should not be made to work in an acting capacity
for long periods of time without adequate compensation.
BENGUET ELECTRIC COOPERATIVE, INC vs HON.
PURAFERRER-CALLEJA AND BENECO EMPLOYEES LABOR
UNION
FACTS:
Beneco Worker's Labor Union-Association of Democratic Labor
Organizations (BWLU- ADLO) filed a petition for direct certification as the
sole and exclusive bargaining representative of all the rank and file employees
of Benguet Electric Cooperative, Inc. (BENECO) alleging that BENECO has
in its employ 214 rank and file employees; that 198 or92.5% of these
employees have supported the filing of the petition; that no certification
election has been conducted for the last 12 months; that there is no existing
collective bargaining representative of the rank and file employees sought to
represented by BWLU- ADLO; and, that there is no collective bargaining
agreement in the cooperative.
An opposition to the petition was filed by the Beneco Employees Labor

Union (BELU) contending that it was certified as the sole and exclusive
bargaining representative of the subject
The med-arbiter found that there are 37 employees who are not
members and without any involvement in the actual ownership of the
cooperative. BELU and BENECO appealed but the same was dismissed for
lack of merit. So BENECO filed with the SC a petition for certiorari which
the SC dismissed for lack of merit in a minute resolution dated April 1986.
BENECO formalized its verbal manifestation by filing a Protest. The

med-arbiter dismissed the protest. BLR director Calleja affirmed the med-
arbiter's order and certified BELU as the sole and exclusive bargaining agent
of all the rank and file employees of BENECO.
ISSUE:
Whether or not employees of a cooperative are qualified to form or join
a labor organization for purposes of collective bargaining.
HELD:
The right to collective bargaining is not available to an employee of a
cooperative who at the same time is a member and co-owner thereof. With
respect, however, to employees who are neither members nor co-owners of
the cooperative they are entitled to exercise the rights to self-organization,
collective bargaining and negotiation as mandated by the Constitution and
applicable statutes.
The fact that the members-employees of BENECO do not participate

in the actual management of the cooperative does not make them eligible to
form, assist or join a labor organization for the purpose of collective
bargaining with petitioner.
CENTRAL NEGROS ELECTRIC COOPERATIVE, INC.
(CENECO) vs SEC OF LABOR and CENECO UNION
OFRATIONAL EMPLOYEES (CURE)
FACTS:
On August 15, 1987, CENECO entered into a collective bargaining
agreement with CURE, a labor union representing its rank-and-file
employees for a term of three years retroactive to April 1, 1987 and
extending up to March 31, 1990.-On December 28, 1989, CURE wrote
CENECO proposing that negotiations be conducted for a new collective
bargaining agreement.
CENECO denied CURE's request on the ground that employees who

at the same time are members of an electric cooperative are not entitled to
form or join a union.
CENECO filed a motion to dismiss to the effect that "employees who

at the same time are members of an electric cooperative are not entitled
to form or join unions for purposes of collective bargaining agreement, for
certainly an owner cannot bargain with himself or his co-owners." Med-
Arbiter Felizardo T. Serapio issued an order granting the petition for
certification election in effect, was a denial of CENECO's motion to
dismiss, and directing the holding of a certification election between
CURE and No Union. CENECO appealed to the Department of Labor and
Employment which issued the questioned order modifying the order of the
med-arbiter by directly certifying CURE as the exclusive bargaining
representative of the rank-and-file employees of CURE.
ISSUE:
Whether or not the employees of CENECO who withdrew their
membership from the cooperative are entitled to form or join CURE for
purposes of the negotiations for a collective bargaining agreement proposed
by the latter.
HELD:
The right of the employees to self-organization is a compelling reason
why their withdrawal from the cooperative must be allowed. As pointed out
by CURE, the resignation of the member- employees is an expression of their
preference for union membership over that of membership in the cooperative.
The avowed policy of the State to afford fall protection to labor and to promote
the primacy of free collective bargaining mandates that the employees’ right
to form and join unions for purposes of collective bargaining be accorded the
highest consideration.
Thus, member employees of a cooperative may withdraw as members

of the cooperative in order to join labor union. Membership in a cooperative
is voluntary; inherent in it is the right not to join.
INTERNATIONAL CATHOLIC MIGRATION COMMISSION vs
NATIONAL LABOR RELATIONS COMMISSION and
BERNADETTE GALANG
FACTS:
Petitioner International Catholic Migration Commission (ICMC),
engaged the services of private respondent Bernadette Galang as a
probationary cultural orientation teacher.
Private respondent filed a complaint for illegal dismissal, unfair labor

practice and unpaid wages against petitioner with the then Ministry of Labor
and Employment, praying for reinstatement with backwages, exemplary and
moral damages.
Labor Arbiter Pelagio A. Carpio rendered his decision dismissing the

complaint for illegal dismissal as well as the complaint for moral and
exemplary damages but ordering the petitioner to pay private respondent the
sum of P6,000.00 as payment for the last three (3) months of the agreed
employment.
On appeal, the NLRC, by a majority vote of Commissioners Guillermo

C. Medina and Gabriel M. Gatchalian, sustained the decision of the Labor
Arbiter and thus dismissed both appeals for lack of merit.
Dissatisfied, petitioner filed the instant petition.
ISSUE:
Whether or not an employee who was terminated during the
probationary period of her employment is entitled to her salary for the
unexpired portion of her six-month probationary employment.
HELD:
There is justifiable basis for the reversal of public respondent's award
of salary for the unexpired three-month portion of private respondent's six-
month probationary employment in the light of its express finding that there
was no illegal dismissal. Records show that private respondent was found by
petitioner to be deficient in classroom management, teacher-student
relationship and teaching techniques. Failure to qualify as a regular employee
in accordance with the reasonable standards of the employer is a just cause for
terminating a probationary employee specifically recognized under Article
282 (now Article 281) of the Labor Code.
It was a grave abuse of discretion on the part of public respondent to

order petitioner to pay private respondent her salary for the unexpired three-
month portion of her six-month probationary employment when she was
validly terminated during her probationary employment. To sanction such
action would not only be unjust, but oppressive on the part of the employer.
REPUBLIC PLANTERS BANK GENERAL SERVICES EMPLOYEES
UNION –NATIONAL ASSOCIATION OF TRADE UNIONS vs.
BIENVENIDO LAGUESMA and REPUBLIC PLANTERS BANK
FACTS:
Petitioner filed a petition for certification election to determine the sole
and exclusive bargaining representative of all regular employees outside the
bargaining unit of Republic Planters Bank The proposed bargaining unit is
composed of clerks, messengers, janitors, plumbers, telex operators, mailing
and printing personnel, drivers, mechanics and computer personnel. They are
excluded from the existing collective bargaining agreement between private
respondent and RPBEU, the duly certified bargaining representative of the
regular employees of private respondent.
Private respondent filed its position paper and moved to dismiss the
petition for certification election. Med-Arbiter Anastacio Bactin dismissed
the petition for certification election on the ground that there is already a
certified bargaining agent.
Petitioner sought a ruling that the other workers in the proposed

bargaining unit should also be considered regular employees of private
respondents since they perform duties necessary to the bank’s business
operations. Petitioner submitted additional documents containing the job
descriptions of eleven (11) employees assigned at private respondent, most of
whom were performing messengerial services. Private respondent reiterated
its objection to the admissibility of the new evidence.
ISSUES:
(1) Whether or not the filed petition for certification election is valid.
(2) Whether or not the Public respondent committed grave abuse of
discretion when (1) it allowed private respondent to participate or
intervene in the certification election and (2) it did not give value to the
documents it submitted on appeal.
HELD:
The petition for certification election was filed on January 21,
1991. The collective bargaining agreement between the duly certified
bargaining agent, Republic Planters Bank Employees Union, and private
respondent was effective from June 30, 1988 to June 30, 1991. It is crystal
clear that the filing of the petition for certification election was premature.
The Petitioner’s act of trying to tilt the balance in its favor by assailing
the legal standing of private respondent in intervening in the certification
election is futile because petitioner did not raise this issue in the proceedings
below. It is too late to litigate the issue on appeal.
The public respondent did not commit grave abuse of discretion when it
rejected the documents submitted by petitioner for the first time on appeal.
SINGER SEWING MACHINE COMPANY VS. DRILON
FACTS:
Respondent union filed for direct certification as the sole and exclusive
bargaining agent of the petitioner company in Baguio. The company opposed
on the ground that the union members are actually not employees but
independent contractor as evidenced by the collection agency agreement
which they signed.
Midarbiter found that there exist an employer-employee relationship

between the union members and the company, granted the petition for
certification election. The union contended that they performed the most
desirable and necessary activities for the continuous and effective operations
of the business of the petitioner’s company citing Article 280 of the Labor
Code.
ISSUE:
Whether Article 280 may be used as a yard stick in determining the
existence of employment relationship.
HELD:
No, Article 280 applies where the existence of employer-employee
relationship is not the issue in dispute. It merely distinguishes between two
kinds of employees, i.e. regular employees and casual employees, for purpose
of determining the right of an employee to certain benefits, to join or form a
union, or to security of tenure.
UP VS. FERRER-CALLEJA
FACTS:
UP seeks the nullification of the order of Director Pura Ferrer-Calleja
of the BLR holding that professors, associate professors and assistant
professors are rank and file employees. Consequently, they should together
with the so-called non-academic, non-teaching and all other employees of the
university, be represented by only one labor organization.
ISSUE:
Whether the above-mentioned employees should belong only to one
labor organization.
HELD:
A bargaining unit is a group of employees, comprised of all or less than the
entire body of the employees, which the collective interest of all employees
consistent with the equity interest of all the employer, indicate to be best suited
to serve the reciprocal rights and duties of the parties under the collective
bargaining provision of the law.
In Democratic Labor Association vs. Cebu Stevedoring, there are factors
which must be considered in determining the proper unit. Ruthenburg
mentions: 1) will of the employees, 20 affinity and unity of employees’
interest, such as substantial similarity of works and duties or similarity of
compensation and work conditions, 3) prior collective bargaining history, 4)
employment status.
The test of the grouping is community of mutuality of interest because the
basic test of an asserted bargaining unit’s acceptability is whether or not it is
fundamentally the combination which will best assure to all employees the
exercise of their collective bargaining rights.
SAN MIGUEL CORPORATION SUPERVISORS AND EXEMPT
UNION AND ERNESTO L. PONCE vs. HONARABLE BIENVENIDO
E. LAGUESMA, HONORABLE DANILO L. REYNANTE
FACTS:
Petitioner union filed before the Department of Labor and Employment
(DOLE) a Petition for District Certification or Certification Election among
the supervisors and exempt employees of the SMC Magnolia Poultry Products
Plants of Cabuyao, San Fernando and Otis.
Med-Arbiter Reynante issued an Order ordering the conduct of certification

among the supervisors and exempt employees of the SMC Magnolia Poultry
Products Plants of Cabuyao, San Fernando and Otis as one bargaining unit.
The public respondent, granted respondent company’s Appeal and ordered

the remand of the case to the Med-Arbiter of origin for determination of the
true classification of each of the employees sought to be included in the
appropriate bargaining unit.
Undersecretary Laguesma granted the reconsideration prayed for on

September 3, 1991 and directed the conduct of separate certification elections
among the supervisors ranked as supervisory levels 1 to 4 (S1 to S4) and the
exempt employees in each of the three plants at Cabuyao, San Fernando and
Otis.
ISSUES:
1. Whether Supervisory employees 3 and 4 and the exempt employees
of the company are considered confidential employees, hence
ineligible from joining a union.
2. If they are not confidential employees, do the employees of the three
plants constitute an appropriate single bargaining unit.
HELD:
On the first issue, The Court ruled that said employees do not fall within
the term “confidential employees” who may be prohibited from joining a
union.
Supervisors 3 and above may not be considered confidential employees
merely because they handle “confidential data” as such must first be strictly
classified as pertaining to labor relations for them to fall under said
restrictions. The information they handle are properly classifiable as technical
and internal business operations data which, to our mind, has no relevance to
negotiations and settlement of grievances wherein the interests of a union and
the management are invariably adversarial. Since the employees are not
classifiable under the confidential type, they may appropriately form a
bargaining unit for purposes of collective bargaining.
BENGUET CONSOLIDATED INC. AND BALATOK MINING CO. VS.
BOBOK LUMBERJACK ASSN. 1958
FACTS:
Petitioner filed an appeal from the order of CIR holding that it finds no
valid reason to change status of petitioner’s 5 camps as separate bargaining
units.
ISSUE:
Whether or not system of having one collective bargaining unit for each
camp should be maintained.
HELD:
Yes. The present system had operated satisfactorily. Prime element in
determining whether a group of employees constitute a proper bargaining unit
is whether it will, without inequity to the employer, best serve all the
employees in the exercise of bargaining rights.
Separation between camps and the different kind of work in each all militate
in favor of the present system since the problem and interest of the worker are
peculiar in each camp or department.
Phil. Diamond Hotel and Resort Inc. v. Manila Diamond Hotel
Employees Union
Facts:
The petition for certification election filed by the Union with the DOLE
was denied for failure to comply with legal requirements. Still, the Union,
through its President, notified petitioner of its intention to negotiate. The latter
advised the Union that since it was not certified by the DOLE as the exclusive
bargaining agent, it could not be recognized as such.
As a result, the Union filed a notice of strike due to alleged unfair labor
practice (ULP). Conciliation conferences were immediately conducted by the
NCMB. In the most recent conference, union demanded the holding of a
consent election to which the Hotel interposed no objection.
However, the union suddenly went on strike. The service upon the
strikers of the TRO notwithstanding, they refused to dismantle the tent they
put up at the employee’s entrance to the Hotel, prompting the Hotel’s security
guards to dismantle the same during which the strikers as well as the guards
were hit by rocks coming from the direction of the construction site at the
nearby Land Bank Plaza, resulting to physical injuries to some of them.
Issue:
Whether petitioner’s refusal to bargain with respondent union
constitutes ULP and may justify staging a strike
Held:
The Union is admittedly not the exclusive representative of the majority
of the employees of petitioner, hence, it could not demand the right to bargain
collectively in their behalf. Petitioner’s refusal to bargain with respondent
cannot be considered a ULP to justify the staging of the strike.
It is doctrinal that the exercise of the right of private sector employees to strike
is not absolute.
As a consequence, the union officers should be dismissed for staging

and participating in the illegal strike, following paragraph 3, Article 264(a) of
the Labor Code. An ordinary striking worker however, cannot be dismissed
for mere participation in an illegal strike. There must be proof that he
committed illegal acts during a strike.
The Court also ruled that when employees voluntarily go on strike, even
if in protest against unfair labor practices, no backwages during the strike is
awarded.
FILOIL REFINERY CORP vs FILOIL EMPLOYEES UNION

FACTS:
Respondent association filed on February 18, 1965 with the industrial
court its petition for certification as the sole and exclusive collective
bargaining agent of all of petitioner's supervisory and confidential employees
working at its refinery in Rosario, Cavite.
Petitioner filed a motion to dismiss the petition on the grounds of lack

of cause of action and of respondent court's lack of jurisdiction over the
subject-matter.
Respondent court cast aside petitioner's sedulous objections against the

inclusion of the confidential employees in the supervisors respondent
association,
ISSUE:
Whether or not the court erred in allowing the inclusion of confidential
employees in the supervisors association.
HELD:
Respondent court correctly held that since the confidential employee
are very few in number and are by practice and tradition identified with the
supervisors in their role as representives of management vis-a-vis the rank and
file employee such identity of interest has allowed their inclusion in the
bargaining unit of supervisors-managers for purposes of collective bargaining
in turn as employees in relation to the company as their employer.
No arbitrariness or grave abuse of discretion can be attributed against

respondent court's allowing the inclusion of the confidential employees in the
supervisors' association for as admitted by petitioner itself, the supervisors
and confidential employees enjoy its trust and confidence. This identity of
interest logically calls for their inclusion in the same bargaining unit and at
the same time fulfills the law's objective of insuring to them the full benefit of
their right to self-organization and to collective bargaining, which could
hardly be accomplished if the respondent association's membership were to
be broken up into five separate ineffective tiny units, as urged by petitioner.
INDOPHIL TEXTILE MILL WORKERS UNION-PTGWO

vs.VOLUNTARY ARBITRATOR TEODORICO P. CALICA and
INDOPHIL TEXTILE MILLS, INC
FACTS:
In April, 1987, petitioner Indophil Textile Mill Workers Union-PTGWO
and private respondent Indophil Textile Mills, Inc. executed a collective
bargaining agreement effective from April 1, 1987 to March 31, 1990.
Indophil Acrylic Manufacturing Corporation was formed and registered

with the Securities and Exchange Commission. Subsequently, Acrylic applied
for registration with the Board of Investments for incentives under the 1987
Omnibus Investments Code. The application was approved on a preferred
non-pioneer status.
The petitioner's contention that Acrylic is part of the Indophil bargaining

unit was opposed by private respondent which submits that it is a juridical
entity separate and distinct from Acrylic.
ISSUES:
(1) Whether or not operations in Indophil Acrylic Corporation are an
extension or expansion of private respondent Company
(2) Whether or not the rank-and-file employees working at Indophil
Acrylic should be recognized as part of, and/or within the scope of the
bargaining unit.
HELD:
Under the doctrine of piercing the veil of corporate entity, when valid
grounds therefore exist, the legal fiction that a corporation is an entity with a
juridical personality separate and distinct from its members or stockholders
may be disregarded. In such cases, the corporation will be considered as a
mere association of persons. The members or stockholders of the corporation
will be considered as the corporation, liability will attach directly to the
officers and stockholders. The doctrine applies when the corporate fiction is
used to defeat public convenience, justify wrong, protect fraud, or defend
crime, or when it is made as a shield to confuse the legitimate issues, or where
a corporation is the mere alter ego or business conduit of a person, or where
the corporation is so organized and controlled and its affairs are so conducted
as to make it merely an instrumentality, agency, conduit or adjunct of another
corporation.
The public respondent Voluntary Arbitrator did not commit grave

abuse of discretion in its interpretation of Section l(c), Article I of the CBA
that the Acrylic is not an extension or expansion of private respondent.
BUENAFLOR C. UMALI, MAURICIA M. VDA. DE CASTILLO,

VICTORIA M. CASTILLO, BERTILLA C. RADA, MARIETTA C.
ABAÑEZ, LEOVINA C. JALBUENA and SANTIAGO M. RIVERA vs.
CA, BORMAHECO, INC. and PHILIPPINE MACHINERY PARTS
MANUFACTURING CO., INC.
FACTS:
Mauricia Castillo was the administratrix in charge over a parcel of land
left be Felipe Castillo. Said land was mortgaged to the Development Bank of
the Philippines and was about to be foreclosed but then Mauricia’s nephew,
Santiago Rivera, proposed that they convert the land into 4 subdivisions so
that they can raise the necessary money to avoid foreclosure. Mauricia agreed.
Rivera sought to develop said land through his company, Slobec Realty
Corporation (SRC), of which he was also the president. SRC then contracted
with Bormaheco, Inc. for the purchase of one tractor. Bormaheco agreed to
sell the tractor on an installment basis. At the same time, SRC mortgaged
said tractor to Bormaheco as security just in case SRC will default. As
additional security, Mauricia and other family members executed a surety
agreement whereby in case of default in paying said tractor, the Insurance
Corporation of the Philippines (ICP) shall pay the balance.
Mauricia died. Her successor-administratrix, Buenaflor Umali,

questioned the foreclosure made by ICP. Umali alleged that all the
transactions are void and simulated hence they were defrauded; that through
Bormaheco’s machinations, Mauricia was fooled into entering into a surety
agreement with ICP; that Bormaheco even made the premium payments to
ICP for said surety bond; that the president of Bormaheco is a director of
PMPMC; that the counsel who assisted in all the transactions, Atty. Martin
De Guzman, was the legal counsel of ICP, Bormaheco, and PMPMC.
ISSUE:
Whether or not the veil of corporate fiction should be pierced.
HELD:
No. There is no clear showing of fraud in this case. The mere fact that
Bormaheco paid said premium payments to ICP does not constitute fraud per
se. As it turned out, Bormaheco is an agent of ICP.
Further, piercing the veil of corporate fiction is not the proper remedy
in order that the foreclosure conducted by ICP be declared a nullity.
The veil of corporate fiction can’t be pierced by the simple reason that
the businesses of two or more corporations are interrelated, absent sufficient
showing that the corporate entity was purposely used as a shield to defraud
creditors and third persons of their rights. In this case, there is no justification
for disregarding their separate personalities.
San Miguel Corporation employees Union-PTGWO vs. Confessor

FACTS:
San Miguel Corporation (SMC) formerly had 4 business divisions:
Beer, Packaging, Feeds and Livestock, Magnolia and Agri-business. The 3rd
and 4th divisions were spun-off in October 1991 and became 2 separate and
distinct corporations: Magnolia Corp and Miguel Food Inc. or (SMFI).
The original CBA, entered into prior to the spin off, became effective
July 1989 until June 1992. This was renegotiated starting July 1992 the
bargaining unit was the petitioner-union until July 1994. During the
negotiations, the labor union insisted that the bargaining unit of SMC should
still include the employees of Magnolia and SMFI and that the renegotiated
terms of the CBA be effective only for the remaining period of the existing
CBA (for 2 years). SMC on the other hand contended that the employees
who moved to Magnolia and SMFI automatically ceased to be part of the
bargaining unit at the SMC, and that the CBS should be effective for 3 years
in accordance to Article 253 (a) of the Labor Code.
ISSUE:
Whether or not the bargaining unit of SMC includes also the employees
of Magnolia and SMFI
HELD:
In determining the bargaining unit the test of grouping is mutuality and
commonality of interest. The employees sought to be represented by the
collective bargaining agent must have substantial mutual interest in terms of
employment and working conditions as evidenced by the type of work they
performed. Considering the spin off, the companies would consequently have
their respective and distinct concerns in terms of the nature of work, wages,
hours of work and other conditions of employment, interest of employees in
the different companies perforce differ. SMC is engaged in the business of
beer manufacturing. Magnolia is involved in manufacturing and processing
dairy products, while SMFI is involved in the production of feeds and
processing of chicken. The nature of their products and scales business may
require different skills which must necessarily be commensurated by different
compensation packages. The different companies may have different
volumes of work and different working conditions. For such reason, the
employees of different companies see the need to group themselves together
and organize themselves into distinctive and different groups. It would then
be best to have separate bargaining units for the different companies where
the employees can bargain separately according to their needs and according
to their own working conditions.
KAPISANAN NG MGA MANGGAGAWA SA MANILA

RAILROAD(KAPISANAN) VS. YARD CREW UNION
FACTS:
Kapisanan filed with the CIR a petition praying that it be certified as
the exclusive bargaining agent in Manila Railroad Company. During the
proceewding, 3 appropraite bargaining units were dterenmined by CIR.
Kapisanan was eventually certified as exclusive bargaining agent (EBA) for
the remaining-company-personal unit. After the decision in favor of
Kapisanan became final, the Yard Crew Union, the Station Employees Union,
and the rail road Engineering Department Union filed their respective
petitions, praying that they be defined as separate bargaining unit and they be
certified in the units sought to be separated. CIR ordered a plebiscite among
the employees in the 3 proposed group as above-mentioned. The employees
of the proposed vote in a secret ballot to be conducted by CIR whether they
desire to be separated from the unit of the rest of the employees being
represented by the Kapisanan. Kapisanan being the EBA of the appropriate
bargaining unit ferom which the 3 unions is petitioning for separate
appropriate bargaining unit now contends that the existence of a CBA between
Kapisanan and Company bars the subject 3 petitions.
ISSUE:
Whether or not CIR’s orders are contrary to law.
HELD:
Because of the modern complexity of the relation between both
employer and union structure, it becomes difficult to determine from the
evidence alone which of the several claimants group forms a proper
bargaining unit. It becomes necessary if to give consideration to the express
will or desire of the employees-a practice designated as the Globe doctrine
which sanctioned the holding of a series of elections, not for the purpose of
allowing the group receiving an overall majority of votes to represent all
employees, but for the purpose of permitting the employees in each of the
several categories to select the group which each chooses as a bargaining unit.
CIR was simply interested in the verification of the evidence submitted
wherein the workers have signed manifestations of their desire to be separated
from the Kapisanan. CIR has the right of full investigation in arriving at a
correct finding of fact in order to deny or grant the petition for certification
election. And one way of determining the desire of the employees is what
CIR suggested: a plebiscite. A plebiscite and not the certification election
itself. The subject orders of CIR do not decide the petitions of the 3 unions.
FARLEY FULACHE et. al vs ABS-CBN BROADCASTING

CORPORATION,
January 21, 2010
FACTS:
The petitioners in this case are questioning the CBA executed between
ABS-CBN and the ABS-CBN Rank-and-File Employees Union (Union)
because under such agreement, they are only considered as temporary and not
regular employees. The petitioners claimed that they should be recognized as
regular employees of ABS-CBN because they had already rendered more than
a year of service in the company and, therefore, entitled to the benefits of a
regular employee.
ABS-CBN pointed out that they are “talents” who are paid a pre-
arranged consideration called “talent fee” taken from the budget of a particular
program. Their contracts are terminated once the program, production or
segment is completed. ABS-CBN alleged that the petitioners’ services were
contracted on various dates by its Cebu station as independent contractors,
hence, not entitled to regularization in these capacities. Labor Arbiter
rendered his decision holding that the petitioners were regular employees of
ABS-CBN, not independent contractors, and are entitled to the benefits and
privileges of regular employees. ABS-CBN appealed the ruling to the NLRC.
Pending, ABS-CBN dismissed Fulache, Jabonero, Castillo, Lagunzad and
Atinen (all drivers) for their refusal to sign up contracts of employment with
service contractor Able Services. The four drivers and Atinen responded by
filing a complaint for illegal dismissal. The Labor Arbiter upheld the validity
of ABS-CBN's contracting out of certain work or services in its operations.
The labor arbiter found that petitioners Fulache, Jabonero, Castillo, Lagunzad
and Atinen had been dismissed due to redundancy, an authorized cause under
the law. The NLRC reversed the labor arbiter’s ruling in the illegal dismissal
case; it found that petitioners Fulache, Jabonero, Castillo, Lagunzad and
Atinen had been illegally dismissed and awarded them backwages and
separation pay in lieu of reinstatement. Under both cases, the petitioners were
awarded CBA benefits and privileges from the time they became regular
employees up to the time of their dismissal.
ISSUE:
whether or not the petitioners are correct that they should be considered
already as regular employees, and w/n the petitioners were dismissed illegally.
RULING:
As regular employees, the petitioners fall within the coverage of the
bargaining unit and are therefore entitled to CBA benefits as a matter of law
and contract. Nothing in the records shows that they are supervisory or
confidential employees; neither are they casual nor probationary employees.
Most importantly, the labor arbiter’s decision of January 17, 2002 – affirmed
all the way up to the CA level – ruled against ABS-CBN’s submission that
they are independent contractors. Thus, as regular rank-and-file employees,
they fall within CBA coverage under the CBA’s express terms and are entitled
to its benefits. The bad faith in ABS-CBN’s move toward its illegitimate goal
was not even hidden; it dismissed the petitioners – already recognized as
regular employees – for refusing to sign up with its service contractor. By law,
illegally dismissed employees are entitled to reinstatement without loss of
seniority rights and other privileges and to full backwages, inclusive of
allowances, and to other benefits or their monetary equivalent from the time
their compensation was withheld from them.
GENERAL RUBBER and FOOTWEAR CORPORATION v. BLR, and

NATIONAL ASSN. OF TRADE UNION OFMONTHLY PAID
EMPLOYEES-NATU (1987)
Facts:
On 15 Oct 1982, General Rubber executed a CBA with General Rubber
Workers Union (Independent). Three years later, the monthly paid employees
formed their own collective bargaining unit [NATU] and filed a petition for
direct certification with the BLR. General Rubber opposed this. On 02 Sep
1985, the Med-Arbiter issued an order for the holding of a certification
election. A month later, the CBA expired. The daily paid rank and file
employees formed the Samahang Manggagawa sa General Rubber
Corporation-ANGLO as their union for collective bargaining. BLR issued an
order that sanctioned the creation of 2 bargaining units in General Rubber.
According to General Rubber there is already an existing bargaining unit,
whose members are represented by the ANGLO for collective bargaining
purposes.
Issue:
whether or not the NATU members/monthly-paid employees are rank-
and-file employees, and w/n the monthly-paid employees should be allowed
to join the union of the daily-paid employees.
Held:
The fact that the employees perform supervisory functions does not
make them managerial employees already. It has not been clearly established
how effective those recommendations are. The proliferation of unions in an
employer unit is discouraged as a matter of policy unless there are compelling
reasons which would deny a certain class of employees the right to self-
organization for purposes of collective bargaining. This case does not fall
squarely within the exception. The monthly-paid rank-and-file employees
have been historically excluded from the bargaining unit composed of daily-
paid rank-and-filers. The NATU members are not managerial employees but
merely considered as rank-and-file employees who have every right to self-
organization or to be heard through a duly certified collective bargaining
union. Members of supervisory unions who do not fall within the definition
of managerial employees shall become eligible to join or assist the rank-and-
file labor organization, and if none exists, to form or assist in the forming of
such organizations. Perhaps it is unusual for General Rubber to have to deal
with two collective bargaining unions but there is no one to blame except
General Rubber itself for creating the situation it is in. From the beginning of
the existence of a bargaining unit, General sought to suppress the NATU
members right to self-organization. General Rubber maintained that the
exclusion of the NATU members from the bargaining union of the rank-and-
file or from forming their own union was agreed upon by General Rubber with
the previous bargaining representatives. It has not been shown that NATU was
privy to this agreement. Even if it were so, it can never bind subsequent
federations and unions because it is a curtailment of the right to self-
organization. The monthly-paid rank-and-file employees should be allowed
to join the union of the daily-paid-rank-and-file employees so that they can
also avail of the CBA benefits or to form their own rank-and-file union,
without prejudice to the certification election that has been ordered.
DELA SALLE UNIVERSITY EMPLOYEES ASSOCIATION-

NATIONAL FEDERATION OF TEACHERS AND EMPLOYEES
UNION (DLSUEA-NAFTEU) vs. DELA SALLE UNIVERSITY and
BUENAVENTURA MAGSALIN
FACTS:
Dela Salle University and Dela Salle University Employees
Association - National Federation of Teachers and Employees Union
(DLSUEA-NAFTEU), which is composed of regular non-academic rank and
file employees, entered into a collective bargaining agreement with a life span
of three (3) years, During the freedom period, the Union initiated negotiations
with the University for a new collective bargaining agreement which,
however, turned out to be unsuccessful, hence, the Union filed a Notice of
Strike.
The University filed with the Second Division of this Court, a petition
for certiorari with temporary restraining order and/or preliminary injunction
assailing the decision of the voluntary arbitrator, as having been rendered "in
excess of jurisdiction and/or with grave abuse of discretion."
ISSUE:
Whether or not the voluntary arbitrator committed grave abuse of
discretion amounting to lack or excess of jurisdiction.
HELD:
The Court affirms the findings of the voluntary arbitrator that the
employees of the College of St. Benilde should be excluded from the
bargaining unit of the rank-and-file employees of Dela Salle University,
because the two educational institutions have their own separate juridical
personality and no sufficient evidence was shown to justify the piercing of the
veil of corporate fiction.
The right to join a labor organization should carry with it the corollary
right not to join the same. The right to refrain from joining labor organizations
recognized by Section 3 of the Industrial Peace Act is, however, limited. The
legal protection granted to such right to refrain from joining is withdrawn by
operation of law, where a labor union and an employer have agreed on a
closed shop, by virtue of which the employer may employ only members of
the collective bargaining union, and the employees must continue to be
members of the union for the duration of the contract in order to keep their
jobs.
STA. LUCIA EAST COMMERCIAL CORPORATION (SLECC) vs.

HON. SECRETARY OF LABOR AND EMPLOYMENT and STA.
LUCIA EAST COMMERCIAL CORPORATION WORKERS
ASSOCIATION (CLUP LOCAL CHAPTER)
FACTS:
On 27 February 2001, Confederated Labor Union of the Philippines
(CLUP), in behalf of its chartered local, instituted a petition for certification
election among the regular rank-and-file employees of Sta. Lucia East
Commercial Corporation and its Affiliates, docketed as Case No. RO400-
0202-RU-007. The affiliate companies included in the petition were SLE
Commercial, SLE Department Store, SLE Cinema, Robsan East Trading,
Bowling Center, Planet Toys, Home Gallery and Essentials. On 21 August
2001, Med-Arbiter Bactin ordered the dismissal of the petition due to
inappropriateness of the bargaining unit. CLUP-Sta. Lucia East Commercial
Corporation and its Affiliates Workers Union appealed the order of dismissal
to this Office on 14 September 2001.
ISSUE:
Whether or the subsequent negotiations and registration of a collective
:Sta. Lucia East Commercial (SMSLEC) could not bar Sta. Lucia East
Commercial Corporation Workers Association’s (SLECCWA) petition for
direct certification?
HELD:
The employer may voluntarily recognize the representation status of a
union in unorganized establishments. SLECC WAS NOT AN UNORGANIZED
ESTABLISHMENT WHEN IT VOLUNTARILY RECOGNIZED SMSLEC AS
ITS EXCLUSIVE BARGAINING REPRESENTATIVE ON 20 JULY
2001. CLUP-SLECC AND ITS AFFILIATES WORKERS UNION FILED A
PETITION FOR CERTIFICATION ELECTION ON 27 FEBRUARY 2001
AND THIS PETITION REMAINED PENDING AS OF 20 JULY 2001. THUS,
SLECC’S VOLUNTARY RECOGNITION OF SMSLEC ON 20 JULY 2001,
THE SUBSEQUENT NEGOTIATIONS AND RESULTING REGISTRATION
OF A CBA EXECUTED BY SLECC AND SMSLEC ARE VOID AND
CANNOT BAR CLUP-SLECCWA’S PRESENT PETITION FOR
CERTIFICATION ELECTION. Court finds it strange that the employer itself,
SLECC, filed a motion to oppose CLUP-SLECCWA’s petition for
certification election. In petitions for certification election, the employer is a
mere bystander and cannot oppose the petition or appeal the Med-Arbiter’s
decision. The exception to this rule, which happens when the employer is
requested to bargain collectively, is not present in the case before us. The
petition is DENIED.
PORT WORKERS UNION OF THE PHILS vs LAGUESMA

207 SCRA 392 March 18, 1992
FACTS:
The CBA between the workers of the International Container
Terminal Services, Inc. (ICTSI and Associate Port Checkers and Workers
Union (APCWU) was about to expire. Other unions were seeking to represent
the laborers in the negotiation of the next CBA and were already plotting their
moves.
Sandigan ng Manggagawa sa Daungan (SAMADA) filed a petition

for certificationelection. The consent signatures of at least 25% of the
employees in the bargaining unit were submitted 11 days after the petition.
Port Workers Union of the Philippines (PWUP) filed a petition

for intervention. PWUP appealed to the Secretary of Labor, arguing that
Article 256 of the Labor Code did not require the written consent to
be submitted simultaneously with the petition forcertification election.
DOLE Undersecretary Bienvenido Laguesma affirmed the order of the

Med-Arbiter and dismissed PWUP’s appeal.
Thereafter, ICTSI and APCWU resumed negotiations for a new

collective bargaining agreement, which was ratified by a majority of the
workers in the bargaining unit, and subsequently registered with the DOLE.
ISSUE:
Whether or not respondent committed grave abuse of discretion in
application of Art 256 of the Labor Code.
Whether or not simultaneous submission is required.
HELD:
Doctrine in Western Agusan Workers Union-Local 101 of the United
Lumber and General Workers of the Philippines vs. Trajano: “it has long been
settled that the policy of the Labor Code is indisputably partial to the holding
of a certification election so as to arrive in a manner definitive and certain
concerning the choice of the labor organization to represent the workers in a
collective bargaining unit. Conformably to said basic concept, this Court
recognized that the Bureau of Labor Relations in the exercise of sound
discretion, may order a certification election notwithstanding the failure to
meet the 30% requirement”.
In line with the policy, we feel that the administrative rule requiring the
simultaneous submission of the 25% consent signatures upon the filing of
petition for certification election should not be strictly applied to frustrate the
determination of the legitimate representative of the workers.
REYES vs. TRAJANO
FACTS:


organizations."
ISSUES:
Whether or not INK members are disqualified to vote.
Whether or not the failure to participate in previous certification
HELD:

YOUNG MEN LABOR UNION STEVEDORES vs CIR
FACTS:
Nasipit Lumber Co., Inc. (NALCO) entered into a contract with Young
Men Labor Union Stevedores (YMLUS) and Victory Stevedoring and Labor
Union (VISLU) whereby the 2 unions bound themselves to undertake loading
jobs of NALCO’s exports at 50-50. YMLUS later sent NALCO a
letter demanding the withdrawal of the job from VISLU on the ground that
its registration permit granted by DOLE had been cancelled; VISLU refused
as the order of cancellation had not become final. YMLUS sent a notice of
picketing if their demand was not carried out.
NALCO filed a petition with the CIR praying that pending

determination of the issue, the unions observe status quo; and, after due
hearing, decide which union gets the job, or comply with the 50-50
arrangement.
After a series of bloody incidents resulting from the picketing by

YMLUS and retaliation from VISLU, NALCO filed a petition with the CIR
praying (1) to issue a TRO against YMLUS to refrain from preventing
VISLU’s operations in any manner (2) issue a similar TRO to VISLU,
ordering them to desist from retaliating (3) after hearing, to issue and order
making such injunctions permanent.
Both unions filed separate motions to dismiss on the ground of lack of

jurisdiction of the CIR but later submitted to the CIR’s jurisdiction. Judge
Martinez rendered a decision enjoining parties to continue observing the 50-
50 arrangement until it is decided by certification election, which party was
to become the bargaining unit. YMLUS and NALCO each filed MFRs as to
the holding of certification elections which were denied, hence this petition.
ISSUES:
(1) Whether or not CIR had jurisdiction to act on the controversy
(2) Whether or not CIR erred in ordering a certification election
HELD:
Sec. 12b of RA 875 provides that matters pertaining to
certification election involving 2 or more unions fall under the jurisdiction of
the CIR. Also, petitioner is estopped from questioning the same since it
withdrew its MFR and voluntarilysubmitted to its jurisdiction to present
evidence.
NO, Sec. 12(b) of RA 875 and is the only expedient way to resolve the
friction between the 2 unions. The object of certification proceedings is not a
decision of any alleged commission of a wrong or asserted deprivation of
rights but is merely the determination of the proper bargaining unit. As such,
said proceedings are investigatory in nature and this Court should not interfere
with the judgment of the CIR, unless grave abuse of discretion is shown.
SAMAHANG MANGGAGAWA SA PERMEX vs. SECRETARY OF

LABOR ,
Facts:
A certification election was conducted among employees of respondent
Permex Producer and Exporter Corporation with ‘No Union’ winning [NFL
lost]. Later however, some employees of Permex Producer formed a labor
organization known as the Samahang Manggagawa sa Permex (SMP) which
they affiliated with the Philippine Integrated Industries Labor Union (PIILU).
(SMP-PIILU) wrote the respondent company requesting recognition as the
sole and exclusive bargaining representative of employees at the Permex
Producer and was granted. They then entered into a CBA. A year later, NFL
filed gain for a petition for certification election but was dismissed. Two
arguments are put forth in support of the petition. First, it is contended that
petitioner has been recognized by the majority of the employees at Permex
Producer as their sole collective bargaining agent. Petitioner argues that when
a group of employees constituting themselves into an organization and
claiming to represent a majority of the work force requests the employer to
bargain collectively, the employer may do one of two things. First, if the
employer is satisfied with the employees’ claim the employer may voluntarily
recognize the union by merely bargaining collectively with it. Second, if on
the other hand, the employer refuses to recognize the union voluntarily, it may
petition the Bureau of Labor Relations to conduct a certification election.
ISSUE:
Whether or not voluntary recognition given by the employer to a union
is tantamount to giving the same the personality as exclusive representative of
the employees
HELD:
The case of Ilaw at Buklod ng Manggagawa v. Ferrer-Calleja is
particularly apropos: “Ordinarily, in an unorganized establishment like the
Calasiao Beer Region, it is the union that files a petition for a certification
election if there is no certified bargaining agent for the workers in the
establishment. If a union asks the employer to voluntarily recognize it as the
bargaining agent of the employees, it in effect asks the employer to certify it
as the bargaining representative of the employees — A CERTIFICATION
WHICH THE EMPLOYER HAS NO AUTHORITY TO GIVE, for it is the
employees’ prerogative (not the employer’s) to determine whether they want
a union to represent them, and, if so, which one it should be.” Permex
Producer should not have given its voluntary recognition to SMP-PIILU-
TUCP when the latter asked for recognition as exclusive collective bargaining
agent of the employees of the company. The company did not have the power
to declare the union the exclusive representative of the workers for the purpose
of collective bargaining. It is not enough that a union has the support of the
majority of the employees. It is equally important that everyone in the
bargaining unit be given the opportunity to express himself.
BELYCA CORPORATION vs DIR. PURA FERRER CALLEJA,

LABOR RELATIONS, MANILA, MINISTRY OF LABOR AND
EMPLOYMENT; MED-ARBITER, RODOLFO S. MILADO,
MINISTRY OF LABOR AND EMPLOYMENT, REGIONAL OFFICE
NO. 10 AND ASSOCIATED LABOR UNION (ALU-TUCP)
FACTS:
Private respondent Associated Labor Union (ALU)-TUCP, a legitimate
labor organization duly registered with the Ministry of Labor and
Employment, filed a petition for direct certification as the sole and exclusive
bargaining agent of all the rank and file employees/workers of Belyca
Corporation (Livestock and Agro-Division), a duly organized, registered and
existing corporation engaged in the business of poultry raising, piggery and
planting of agricultural crops such as corn, coffee and various vegetables,
employing approximately 205 rank and file employees/workers, the collective
bargaining unit sought in the petition, or in case of doubt of the union's
majority representation, for the issuance of an order authorizing the immediate
holding of a certification election .
Respondent ALU seeks direct certification as the sole and exclusive

bargaining agent of all the rank-and-file workers of the livestock and agro
division of petitioner BELYCA Corporation, engaged in piggery, poultry
raising and the planting of agricultural crops such as corn, coffee and various
vegetables.
ISSUES:
(1) Whether or not the proposed bargaining unit is an appropriate
bargaining unit.
(2) Whether or not the statutory requirement of 30% (now 20%) of the
employees in the proposed bargaining unit, asking for a certification election
had been strictly complied with.
HELD:
Definitely, they have very little in common with the employees of the
supermarts and cinemas. To lump all the employees of petitioner in its
integrated business concerns cannot result in an efficacious bargaining unit
comprised of constituents enjoying a community or mutuality of interest.
It is significant to note that 124 employees out of the 205 employees of

the Belyca Corporation have expressed their written consent to the
certification election or more than a majority of the rank and file employees
and workers; much more than the required 30% and over and above the
present requirement of 20% by Executive Order No. 111 issued on December
24, 1980 and applicable only to unorganized establishments under Art. 257,
of the Labor Code, to which the BELYCA Corporation belong
GEORGE AND PETER LINES, INC vs ASSOCIATED LABOR UNION
FACTS:
George and Peter Lines, Inc. (petitioner) is involved in shipping, while
Associated Labor Unions (ALU, respondent) is a legitimate labor
organization.
July 16, 1878: a Petition for Direct Certification was filed by ALU
praying that it be certified as the SOLE and EXCLUSIVE bargaining
representative of all the rank and file employees of petitioner corporation,
there being no labor union.
Petitioner opposed the petition stating that the Union does not represent
the majority of the employees concerned, and that more than 80% of the
licensed/ unlicensed crew of its vessels claim they are not members of any
union.
Bureau of Labor Relations Director, upon examination of the

documents, opined that there existed a doubt regarding the majority of status
of respondent ALU because of the withdrawal of the members, and directed
a certification election.
Upon a motion for reconsideration by ALU, the BLR Director

reconsidered its Resolution and directly certified ALU as sole bargaining
agent.
ISSUES:
Whether or not employees of the corporation are entitled to choose their
sole and exclusive bargaining representative with petitioner thru
a certification election
Whether or not petitioner is entitled to file petition for certification
election.
HELD:
Ratio Employees have the constitutional right to choose the labor
organization which it desires to join. The exercise of such right would be
rendered nugatory and ineffectual ifthey would be denied the opportunity to
choose in a certification election. Reasoning The holding of
a certification election is a statutory policy that should not be circumvented.
The best forum to determine if there was indeed undue pressure exerted
upon the employees to retract their membership is in the certification election
itself (in secret ballot where they can freely express their choice).
The fact that there are no competing Unions should not affect the
freedom of choice (they can always choose ALU or ‘No Union’).
PLUM vs NORIEL
FACTS:
Plum Federation of Industrial and Agrarian Workers filed a petition,
praying that it be certified as the sole and exclusive bargaining agent of the
rank-and-file workers of Manila Jockey Club, Inc. The Manila Jockey Club
Race Day Operation Employees Labor Union-PTGWO filed a motion to
intervene and opposition to said petition and alleged among other things, that
it is the recognized collective bargaining representative of all the employees of
the company and that it is in the process of negotiating a modification of
the collective bargaining agreement.
Another supplemental MTD was filed by intervenor PTGWO, this time

invoking the “No Union Raiding Clause” of the “Code of Ethics” adopted by
the members of the Trade Union Congress of the Philippines (T.U.C.P.)
wherein both petitioner and intervenor are members, and claiming that the
petition failed to satisfy the 30% requirement of the law.
The BLR endorsed the case to Officer-in-Charge Vicente Leodegardo,

Jr., of Region IV for appropriate action. On May 5, 1977, Atty. Luna C.
Piezas, Chief, Med-Arbiter Section of Region IV, Department of Labor,
promulgated an order 2 dismissing the case pursuant to the letter of the
President of the T.U.C.P. Petitioner PLUM filed an appeal to the Bureau
of Labor Relations predicated on the ground that TUCP has no authority in
law to grant or deny election under the Labor Code which mandated the secret
ballot to elect the true union representative. On September 17, 1977, the
Bureau Director issued a resolution 3 dismissing the appeal.
ISSUE:
Whether or not the Director erred in dismissing the appeal filed by the
petitioner.
HELD:
Employees are deprived of the benefits of a CBA because management
refused to bargain with the union. A certification of election is warranted.
Workers’ welfare can be promoted through the bargaining
process. Certification of election is the fairest and most effective way of
determining which labor organization can truly represent the working force.
The will of the majority is controlling. The director is still empowered to call
for a certification election. Instead of ordering an election, Director dismissed
the appeal of PLUM based on the decision of TUCP. This is frowned upon by
the Court.
ACOJE WORKERS’ UNION vs NATIONAL MINES AND ALLIED

WORKERS’ UNION (NAMAWU), ACOJE MINES COMPANY and
COURT OF INDUSTRIAL RELATIONS GR No. L-18848 April 23,
1963
FACTS:
Department of Labor, through the BLR, conducted on June 9, 1961, a
“consent election” among the workers of the Acoje Mining Company at Santa
Cruz, Zambales, in which 5 labor unions participated, namely, the Acoje
United Workers’ Union, the Acoje Labor Union (PELTA), the Acoje Labor
Union (PLUM), respondent National Mines and Allied Workers’ Union
(NAMAWU), and petitioner Acoje Workers’ Union. NAMAWU won in the
said election.
Petitioner Union — which had been defeated by respondent Union by

a margin of 282 votes — had filed a motion to invalidate said election upon
several grounds. After hearing, the lower court issued, on July 21, 1961, the
order appealed from holding that said motion was without merit, and
certifying respondent Union NAMAWU as the sole and exclusive bargaining
agent of all the workers of the Company. MR of petitioner was denied, hence
this present appeal by certiorari, and petitioner now maintains that the lower
court should have invalidated the aforementioned election for the same was
“the result of acts of terrorism, force, threat and intimidation employed by”
agents of respondent Union. The petitioner also questioned the list of qualified
voters that was used during the election which was based on the payroll of the
employees.
ISSUE:
Can a payroll be used as the basis for qualified employee - voters?
HELD:
YES. It appears that labor unions concerned agreed, not only to the
holding of the aforementioned election, but also to the use of the Company
payroll of March 31, 1961, as the basis for determining who are qualified to
vote subject to the approval of the lower court. The Company presented its
aforementioned payroll to said court and stated that the labor unions had been
furnished copy thereof, at least 3 days prior thereto. Said labor unions were
given an opportunity to make their comments and observations on the list of
workers contained in the payroll and to ask or suggest the inclusion or
exclusion of names therein or therefrom. Hence, petitioner may no longer
contest the accuracy of the aforementioned voters list.
AIRTIME SPECIALISTS, INC vs DIRECTOR OF LABOR

RELATIONS FERRER-CALLEJA December 29, 1989
FACTS:
Respondent Samahan ng mga Manggagawa sa Asia-FFW Chapter
(SAMA-ASIA, for short) filed with the National Capital Region, Ministry of
Labor and Employment, two separate petitions for
direct certification and/or certification election on behalf of the regular rank-
and-file employees of the petitioners Airtime Specialists and Absolute Sound,
Inc. The other respondent Pinagbuklod ng Manggagawa sa Ataco-FFW
Chapter (PMA for short) also filed with the same office, on the same day,
similar separate petitions in behalf of the regular rank and file employees of
petitioners Country-Wealth Development, Ad Planner and Marketing
Counsellors and Atlas Resources.
All these five cases were consolidated. Petitioners filed their position
paper with motion to dismiss on the following grounds — disaffiliation of
the rank and file employees, ineligibility of some signatories because they had
less than one (1) year of service resulting in the non-compliance with the 30%
requirement.
Petitioners’ motion for reconsideration having been denied they filed

the instant petition for “Certiorari and Prohibition with Preliminary
Injunction” with a Prayer for the issuance of a temporary restraining order
enjoining public respondents from conducting any further proceedings in the
said five cases.
ISSUE:
Whether or not the Bureau of Labor Relations has discretion in ordering
a certification election
HELD:
YES. The court ruled that we should give discretion to the Court of
Industrial Relations, or in this case, the Bureau of Labor Relations in deciding
whether or not to grant a petition for certification election considering the
facts and circumstances of which it has intimate knowledge. Moreover, a
perusal of Art. 258 of the Labor Code as amended by Presidential Decree No.
442 reveals that compliance with the 30% requirement (now 20%) makes it
mandatory upon the Bureau of Labor Relations to order the holding of
a certification election in order to determine the exclusive-bargaining agent of
the employees. Stated otherwise, it means that with such, the Bureau is left
without any discretion but to order the holding of certification election.
Parenthetically, where the petition is supported by less than 30% (now 20%)
the Bureau of Labor Relations has discretion whether or not to order the
holding of certification election depending on the circumstances of the case.
PHILIPPINE FRUITS AND VEGETABLE INDUSTRIES, INC vs HON.

RUBEN D. TORRES, TRADE UNION OF THE PHILIPPINES AND
ALLIED SERVICES (TUPAS)
FACTS:
Med-Arbiter Basa issued an Order granting the petition for
Certification election filed by the Trade Union of the Philippines and Allied
Services.
Med-Arbiter Basa issued an Order dated December 9, 1988 allowing

184 of the 194 questioned workers to vote, subject to challenge, in the
certification election. Copies of said Order were furnished the parties and on
December 12, 1988 the notice of certification election was duly posted. One
hundred sixty eight (168) of the questioned workers actually voted on election
day.
Trade Union of the Philippines and Allied Services (TUPAS), on the

other hand, argued that the employment status of said employees has been
resolved when Labor Arbiter Ricardo N. Martinez, in his Decision dated
November 26, 1988 rendered in NLRC Case No. Sub-Rab-01-09-7-0087-88,
declared that said employees were illegally dismissed.
ISSUES:
(1) Whether or not The Honorable Secretary of Labor and Employment
acted with grave abuse of discretion amounting to lack of jurisdiction and
committed manifest error in upholding the certification of TUPAS as the sole
bargaining agent.
(2)Whether or not The Honorable Secretary of Labor committed an
abuse of discretion in completely disregarding the issue as to whether or not
non-regular seasonal workers who have long been separated from
employment prior to the filing of the petition for certification election would
be allowed to vote and participate in a certification election.
HELD:
As explained correctly by the Solicitor General, the phrase "close of
election proceedings" refers to that period from the closing of the polls to the
counting and tabulation of the votes as it could not have been the intention of
the Implementing Rules to include in the term "close of the election
proceedings" the period for the final determination of the challenged votes
and the canvass thereof, as in the case at bar which may take a very long
period. Thus, if a protest can be formalized within five days after a final
determination and canvass of the challenged votes have been made, it would
result in an undue delay in the affirmation of the employees' expressed choice
of a bargaining representative.
As regards the second assignment of error, the public respondent

Secretary of Labor did not completely disregard the issue as to the voting
rights of the alleged separated employees for precisely, he affirmed on appeal
the findings of the Med-Arbiter.
REYES vs. TRAJANO
FACTS:


organizations."
ISSUES:
1. Whether or not INK members are disqualified to vote.
2. Whether or not the failure to participate in previous certification

HELD:
PTT vs. Laguesma
FACTS:
PT&T Supervisory Employees Union-APSOTEU (UNION, for
brevity) filed a petition before the Industrial Relations Division of the
Department of Labor and Employment praying for the holding of a
certification election among the supervisory employees of petitioner
Philippine Telegraph & Telephone Corporation (PT&T, for brevity). UNION
amended its petition to include the allegation that PT&T was an unorganized
establishment employing roughly 100 supervisory employees from whose
ranks will constitute the bargaining unit sought to be established. PT&T
moved to dismiss the petition for certification election on the ground that
UNION members were performing managerial functions and thus were not
merely supervisory employees. Moreover, PT&T alleged that a certified
bargaining unit already existed among its rank-and-file employees which
barred the filing of the petition. UNION opposed the motion to dismiss,
contending that under the Labor Code supervisory employees are not eligible
to join the labor organization of the rank-and-file employees although they
may form their own. The Med-Arbiter granted the petition and ordered that “a
certification election . . . (be) conducted among the supervisory personnel of
the Philippine Telegraph & Telephone Corporation (PT&T).”
ISSUE:
whether there should be a certification election pushed by the UNION.
HELD:
The applicable provision of law is Art. 257 of the Labor Code. The
supervisory employees of PT&T did not yet have a certified bargaining agent
to represent them at the time the UNION, which is a legitimate labor
organization duly registered with the Department of Labor and Employment,
filed the petition for certification election. Since no certified bargaining agent
represented the supervisory employees, PT&T may be deemed an
unorganized establishment within the purview of Art. 257 of the Labor Code.
The fact that petitioner’s rank-and-file employees were already represented
by a certified bargaining agent does not make PT&T an organized
establishment vis-a-vis the supervisory employees. After all, supervisory
employees are “not eligible for membership in a labor organization of the
rank-and-file employees.” The Med-Arbiter, committed no grave abuse of
discretion in granting the petition for certification election among the
supervisory employees of petitioner PT&T because Art. 257 of the Labor
Code provides that said election should be automatically conducted upon
filing of the petition. In fact, Sec. 6 of Rule V, Book V, of the Implementing
Rules and Regulations makes it mandatory for the Med-Arbiter to order the
holding of a certification election. It reads — “Sec. 6. Procedure. Upon receipt
of a petition, the Regional Director shall assign the case to a Med-Arbiter for
appropriate action. The Med-Arbiter, upon receipt of the assigned petition,
shall have twenty (2) working days from submission of the case for resolution
within which to dismiss or grant the petition. In a petition filed by a legitimate
organization involving an unorganized establishment, the Med-Arbiter shall
immediately order the conduct of a certification election . . .”
HERCULES INDUSTRIES, INC vs THE SECRETARY OF LABOR,

UNDERSECRETARY BIENVENIDO E. LAQUESMA, MED-
ARBITER MELCHOR S. LIM AND THE NATIONAL FEDERATION
OFLABOR
FACTS:
Respondent National Federation of Labor (NFL), a legitimate labor
federation, filed a petition for certification election alleging that the existing
collective bargaining agreement would expire in August, 1987 and that it
enjoys the support of more than twenty per cent (20%) of the rank and file
employees in the bargaining unit.
A pre-election conference was conducted. The parties, however, could

not agree on the list of qualified voters who would participate in the election.
Specifically, Hercules Industries, Inc. charged that the list included ninety
eight (98) scabs; sixteen (16) capatazes; eight (8) security guards; and nine (9)
managerial employees.
Zamboanga Rubber Workers Union, a duly organized labor union
affiliated with the Philippine Integrated Industries Labor Union, filed a motion
for intervention in this Court alleging that it had requested the petitioner in
writing to recognize it as the sole and exclusive bargaining agent of its
workers. The motion was noted by this Court without action.
ISSUE:
Whether or not the petitioner, Hercules Industries, Inc., as employer,
may question the validity of the certification election among its rank-and-file
employees.
HELD:
NO,The only instance when the employer may be involved in that
process is when it is obliged to file a petition for certification election on its
workers’ request to bargain collectively pursuant to Article 258 of the Labor
Code.
The Solicitor General correctly observed that while the employees

themselves never requested the petitioner to bargain collectively, still, they
did not object to the results of the certification election. Hence, petitioner’s
appeal to the Bureau of Labor Relations from the Med-Arbiter’s Order
certifying the NFL as the exclusive bargaining agent of its rank and file
employees, and its filing of this petition for certiorari with us, must be
rejected. The employer’s intervention in the certification election of its
workers is frowned upon by law.
The Med-Arbiter did not err in declaring the NFL as the duly elected
exclusive bargaining agent of the petitioner’s rank and file workers. That
finding should be accorded not only respect but also finality by this Court for
it is supported by substantial evidence.
ORIENTAL TIN CAN LABOR UNION vs SECRETARY OF LABOR
FACTS:
Company entered into CBA with OTCLU (Oriental Tin Can Labor
Union). 248 rank and file workers FFW to file a petition
for certification election. However, this petition was repudiated by waiver of
115 signatories who ratified the new CBA.
DOLE issued certificate of registration of the CBA. It showed that the

CBA between the OTCLU and the company has the force and effect of law.
OTCWU-FFW officers walked out of their jobs. The union filed notice of
strike with NCMB grounded on alleged dismissal of union members.
Med-arbiter dismissed petition for certification election. OTCWU-

FFW appealed to Sec of Labor. Pending appeal, they staged a strike. They
prevented free ingress and egress of non-striking employees, and vehicles.
NLRC issued a writ of preliminary injunction.
Labor Usec issued resolution granting the appeal and setting aside the
order of Med-arbiter.After denial of their MFR, the company and OTCLU
filed petitions for certiorari before SC.
ISSUES:
(1) Whether or not the employer can challenge petitions for
certification election.
(2) Whether or not it is proper to dismiss a petition for certification
election because a new CBA has already been ratified
(3) Whether or not the 25% support requirement has been met in this
case
HELD:
NO, Certification elections are exclusively the concern of employees;
hence, the employer lacks the legal personality to challenge the same.
The only instance when an employer may concern itself with employee
representation activities is when it has to file the petition for certification
election because there is no existing CBA in the unit and it was requested to
bargain collectively, pursuant to Article 258 of Labor Code. After filing the
petition, the role of the employer ceases and it becomes a mere bystander.
Company’s interference in the certification election below by actively
opposing the same is manifestly uncalled-for and unduly creates a suspicion
that it intends to establish a company union.
The designation or selection of the bargaining representative without,

however, going through the process set out by law for the conduct of
a certification election applies only when representation is not in issue.
TANDUAY DISTILLERY LABOR UNION vs NLRC
FACTS:
Private respondents were all employees of Tanduay Distillery, Inc.,
(TDI) and members of the Tanduay Distillery Labor Union (TDLU), a duly
organized and registered labor organization and the exclusive bargaining
agent of the rank and file employees of the petitioner company.
A Collective Bargaining Agreement (CBA), was executed between

TDI and TDLU. The CBA was duly ratified by a majority of the workers in
TDI including herein private respondents and contained a union security
clause which provides that “all workers who are or may during the effectivity
of the CBA, become members of the Union in accordance with its
Constitution and By-Laws shall, as a condition of their continued
employment, maintain membership in good standing in the Union for the
duration of the agreement.”
TDLU created a committee to investigate its erring members in

accordance with its by-laws which are not disputed by the private respondents.
Thereafter, TDLU, through the Investigating Committee and approved by
TDLU's Board of Directors, expelled the private respondents from TDLU for
disloyalty to the Union.
ISSUES:
(1) whether or not TDI was justified in terminating private respondents'
employment in the company on the basis of TDLU's demand for the
enforcement of the Union Security Clause of the CBA between TDI and
TDLU; and
(2) Whether or not TDI is guilty of unfair labor practice in complying
with TDLU's demand for the dismissal of private respondents.
HELD:
The dismissal of an employee pursuant to a demand of the majority
union in accordance with a union security agreement following the loss of
seniority rights is valid and privileged and does not constitute an unfair labor
practice.
Article 249 (e) of the Labor Code as amended specifically recognizes

the closed shop arrangement as a form of union security. The closed shop, the
union shop, the maintenance of membership shop, the preferential shop, the
maintenance of treasury shop, and check-off provisions are valid forms of
union security and strength. They do not constitute unfair labor practice nor
are they violations of the freedom of association clause of the Constitution.
There is no showing in these petitions of any arbitrariness or a violation of the
safeguards enunciated in the decisions of this Court interpreting union
security arrangements brought to us for review.
REPUBLIC PLANTERS BANK GENERAL SERVICES EMPLOYEES

UNION –NATIONAL ASSOCIATION OF TRADE UNIONS vs.
BIENVENIDO LAGUESMA and REPUBLIC PLANTERS BANK
FACTS:
Petitioner filed a petition for certification election to determine the sole
and exclusive bargaining representative of all regular employees outside the
bargaining unit of Republic Planters Bank The proposed bargaining unit is
composed of clerks, messengers, janitors, plumbers, telex operators, mailing
and printing personnel, drivers, mechanics and computer personnel. They are
excluded from the existing collective bargaining agreement between private
respondent and RPBEU, the duly certified bargaining representative of the
regular employees of private respondent.
Private respondent filed its position paper and moved to dismiss the
petition for certification election. Med-Arbiter Anastacio Bactin dismissed
the petition for certification election on the ground that there is already a
certified bargaining agent.
Petitioner sought a ruling that the other workers in the proposed

bargaining unit should also be considered regular employees of private
respondents since they perform duties necessary to the bank’s business
operations. Petitioner submitted additional documents containing the job
descriptions of eleven (11) employees assigned at private respondent, most of
whom were performing messengerial services. Private respondent reiterated
its objection to the admissibility of the new evidence.
ISSUES:
Whether or not the filed petition for certification election is valid.
Whether or not the Public respondent committed grave abuse of
discretion when (1) it allowed private respondent to participate or intervene
in the certification election and (2) it did not give value to the documents it
submitted on appeal.
HELD:
The petition for certification election was filed on January 21,

1991. The collective bargaining agreement between the duly certified
bargaining agent, Republic Planters Bank Employees Union, and private
respondent was effective from June 30, 1988 to June 30, 1991. It is crystal
clear that the filing of the petition for certification election was premature.
The Petitioner’s act of trying to tilt the balance in its favor by assailing
the legal standing of private respondent in intervening in the certification
election is futile because petitioner did not raise this issue in the proceedings
below. It is too late to litigate the issue on appeal.
The public respondent did not commit grave abuse of discretion when
it rejected the documents submitted by petitioner for the first time on appeal.
ASSOCIATED LABOR UNION vs. CALLEJA
FACTS
The associated Labor Unions (ALU) informed GAW Trading, Inc.
(GAWTI) that majority of the latter’s employees have authorized ALU to be
their sole and exclusive bargaining representative, and requested
GAW Trading Inc., for a conference for the execution of an initial CBA.
GAWTI recognized ALU as the sole and exclusive bargaining agent for ALU
in behalf of the majority of the employees of GAW Trading Inc. and GAWTI
signed and executed the CBA.
In the meantime, the Southern Philippines Federation of Labor (SPFL)

together with Nagkahiusang Mamumuo sa GAW (NAMGAW) undertook a
Strike after it failed to getthe management of GAWTI to sit for a
conference respecting its demands in an effort to pressure GAWTI to make a
turnabout of its standing recognition of ALU as the sole and exclusive
bargaining representative of its employees, as to which strike GAWTI filed a
petition for Restraining Order/Preliminary Injunction, and which strike Labor
Arbiter Tumamak held as illegal.
Trajano’s decision was reversed by herein public respondent Calleja.

ALU filed MFR but was denied. Calleja ordered the holding of a certification
election ruling that the “contract bar rule” relied upon by her predecessor
Trajano does not apply in the present case. Calleja ruled that CBA is defective
because it “was not duly submitted in accordance with Sec. I, Rule IX, Book
V of the Implementing Rules of BP 130.”
ISSUE:
Whether or not Calleja erred in reversing Trajano’s ruling and ordering
the holding of a certification election.
HELD:
NO, The CBA in question is defective.The standing of ALU as an
exclusive bargaining representative is dubious. The recognition by GAWTI
appears to have been based on the self-serving claim of ALU that it had the
support of the majority of the employees in the bargaining unit.
CBA was defective also because of: [a] the failure of GAWTI to post
the CBA in at least 2 conspicuous places in the establishment at least 5 days
before its ratification, [b] the finding of Calleja that 181 of the 281 4 Art. 256.
Representation issue in organized establishments.
DIVINE WORD UNIVERSITY OF TACLOBAN vs SECRETARYOF

LABOR
FACTS:
Divine Word University Employees Union (DWUEU) is the sole and
bargaining agent of the Divine Word University. Sometime in 1985, DWUEU
submitted its collective bargaining proposals. The University replied and
requested a preliminary conference which unfortunately did not take place due
to the alleged withdrawal of the CBA proposals.
Because of this, the union filed a notice of strike on the grounds of

bargaining deadlock and unfair labor practice.
Then, an agreement between the University and DWUEU-ALU were

held after the filing of the notice of strike.
DWUEU-ALU, consonant with the agreement, submit edits collective

bargaining proposals but were ignored by the University.
ISSUE:
Whether or not the complaint for unfair labor practice filed by the
Union is with merit.
HELD:
A thorough study of the records reveals that there was no “ reasonable
effort at good faith bargaining” specially on the part of the University. Its
indifferent to wards collective bargaining inevitably resulted in the failure of
the parties to arrives at an agreement. As it was evident that unilateral moves
were being undertaken only by the DWUEU-ALU, there was no counter
action of forces or an impasse to speak of. While collective bargaining should
be initiated by the unin, there is a corresponding responsibility on the part of
the employer to respond in some manner to such acts. This is clear from the
provision of the Labor Code Art 250 which states when a party desires to
negotiate an agreement, it shall serve a written notice upon the other party
with a statement of its proposals. The other party shall make a reply thereto
not later than 10 calendar days from receipt of such notice. Hence, petitioner's
contention that the DWUEU-ALU's proposals may not be unilaterally
imposed on it on the ground that a collective bargaining agreement is a
contract wherein the consent of both parties is indispensable is devoid of
merit. A similar argument had already been disregarded in the case of Kiok
Loy vs. NLRC, where we upheld the order of the NLRC declaring unions draft
CBA proposal as the collective bargaining agreement which should govern
the relationship between the parties.
A company’s refusal to make counter proposal if considered in relation

to the entire bargaining process, may indicate bad faith and this is especially
true where the Union.
SAN MIGUEL CORPORATION vs NATIONAL LABOR RELATIONS

COMMISSION (NLRC)
FACTS:
Ibias (respondent) was employed by petitioner SMC on 24 December
1978 initially as a CRO operator in its Metal Closure and Lithography Plant.
Respondent continuously worked therein until he advanced as Zamatic
operator. He was also an active and militant member of a labor organization
called Ilaw Buklod Manggagawa (IBM)-SMC Chapter.
It appears that per company records, respondent was AWOP on the

following dates in 1997: 2, 4 and 11 January; 26, 28 and 29 April; and 5, 7, 8,
13, 21, 22, 28 and 29 May. For his absences on 2, 4 and 11 January and 28
and 29 April, he was given a written warning dated 9 May 1997 that he had
already incurred five (5) AWOPs and that further absences would be subject
to disciplinary action.
The labor arbiter believed that respondent had committed the absences
pointed out by SMC but found the imposition of termination of employment
based on his AWOPs to be disproportionate since SMC failed to show by clear
and convincing evidence that it had strictly implemented its company policy
on absences. It also noted that termination based on the alleged falsification
of company records was unwarranted in view of SMC’s failure to establish
respondent’s guilt.
The appellate court also held that respondent’s AWOPs did not warrant
his dismissal in view of SMC’s inconsistent implementation of its company
policies.
ISSUE:
Whether or not the Court of Appeals erred in sustaining the findings of the
labor arbiter and the NLRC and in dismissing SMC’s claims that respondent
was terminated from service with just cause.
HELD:
Proof beyond reasonable doubt is not required as a basis for judgment
on the legality of an employer’s dismissal of an employee, nor even
preponderance of evidence for that matter, substantial evidence being
sufficient. In the instant case, while there may be no denying that respondent’s
medical card had falsified entries in it, SMC was unable to prove, by
substantial evidence, that it was respondent who made the unauthorized
entries. Besides, SMC’s (Your) Guide on Employee Conduct punishes the act
of falsification of company records or documents; it does not punish mere
possession of a falsified document.
SMC acted well within its rights when it dismissed respondent for his
numerous absences. Respondent was afforded due process and was validly
dismissed for cause.
COLEGIO DE SAN JUAN DE LETRAN vs. ASSOCIATION OF
EMPLOYEES AND FACULTY OF LETRAN and ELEONOR AMBAS
FACTS:
Salvador Abtria, then President of respondent union, Association of
Employees and Faculty of Letran, initiated the renegotiation of its Collective
Bargaining Agreement with petitioner Colegio de San Juan de Letran for the
last two (2) years of the CBA's five (5) year lifetime from 1989-1994. On the
same year, the union elected a new set of officers wherein private respondent
Eleanor Ambas emerged as the newly elected President.
Ambas wanted to continue the renegotiation of the CBA but petitioner,

through Fr. Edwin Lao, claimed that the CBA was already prepared for
signing by the parties. The parties submitted the disputed CBA to a
referendum by the union members, who eventually rejected the said CBA.
Petitioner accused the union officers of bargaining in bad faith before

the National Labor Relations Commission (NLRC).
The appellate court dismissed the petition and affirmed the findings of
the Secretary of Labor and Employment.
ISSUES:
(1) Whether or not petitioner is guilty of unfair labor practice by
refusing to bargain with the union when it unilaterally suspended the ongoing
negotiations for a new Collective Bargaining Agreement (CBA) upon mere
information that a petition for certification has been filed by another legitimate
labor organization.
(2) Whether or not the termination of the union president amounts to
an interference of the employees' right to self-organization.
The petition is without merit.
HELD:
In order to allow the employer to validly suspend the bargaining process
there must be a valid petition for certification election raising a legitimate
representation issue. Hence, the mere filing of a petition for certification
election does not ipso facto justify the suspension of negotiation by the
employer. The petition must first comply with the provisions of the Labor
Code and its Implementing Rules. Foremost is that a petition for certification
election must be filed during the sixty-day freedom period. In the case at bar,
the lifetime of the previous CBA was from 1989-1994.
The right to self-organization of employees must not be interfered with

by the employer on the pretext of exercising management prerogative of
disciplining its employees. In this case, the totality of conduct of the employer
shows an evident attempt to restrain the employees from fully exercising their
rights under the law. This cannot be done under the Labor Code.
UNITED CMC TEXTILE WORKERS UNION vs LABOR ARBITER
FACTS:
Petitioner union filed a complaint against CTMI for non-payment of the
1978 Christmas bonus of rank and file employees as provided in their CBA.
The decision of the SC has become final and executory in favor of the
petitioner union.
Subsequently, CTMI filed an appeal stating that the decision of the SC

has become moot and academic by virtue of a previous jurisprudence (La
Carlota) ruling that employers already paying the equivalent of the 13 th month
pay to their employees, such as Christmas bonus, are under no legal obligation
to pay an additional month pay prescribed under PD 851. Respondent Labor
Arbiter refused to continue with the execution of the decision contending that
it has become moot and academic.
ISSUES:
(1) Whether or not employer paying its employees the Christmas bonus
under the CBA is no longer required to pay the 13 th month pay
provided under PD 851.
(2) Whether or not the Carlota ruling is applicable in the case herein.
HELD:
Yes. If the Christmas bonus was included in the 13th month pay, then
there would be no need for having a specific provision on Christmas bonus in
the CBA. But it did provide, thus the intention is clear that said bonus is meant
to be in addition to the legal requirement.
No. La Carlota doctrine cannot be applied because judgments which

had been long become final and executory can no longer be amended or
modified by the courts. Such doctrine known as “the law of the case.”
SAMAHAN NG MANGGAGAWA SA PACIFIC PLASTIC vs. HON.

BIENVENIDO LAGUESMA
Facts:
Petitioner SAMAHAN and respondent MNMPP are labor unions of
rank and file employees at the Pacific Plastic Corporation (PPC) in
Valenzuela, Metro Manila. On August 24, 1990, MNMPP filed a Petition for
Certification Election, alleging that there were more or less 130 rank and file
employees at the PPC whom it was seeking to represent. SAMAHAN
countered by seeking the cancellation of MNMPP’s union registration. As a
result, MNMPP’s petition to be certified as the bargaining agent was
dismissed. MNMPP appealed to the Secretary of Labor who, on March 5,
1991, reversed the decision of the Med-Arbiter and ordered the holding of a
certification election among the rank and file employees of the PPC. The PPC
filed a Motion for Reconsideration but its motion was denied.
Issue:
Whether or not the certification election held on October 6, 1992 is
valid using the list furnished by the SSS.
Held:
The certification election held on October 6, 1992 is valid. Art. 256 of
the Labor Code provides that in order to have a valid election, at least a
majority of all eligible voters in the unit must have cast their votes. The
certification election results show that more than a majority, i.e., 62 out of a
total of 98 eligible voters included in the list of employees obtained from the
SSS, cast their votes. Hence, the legal requirement for a valid election was
met.
It should ideally be the payroll which should have been used for the
purpose of the election. However, the unjustified refusal of a company to
submit the payroll in its custody, despite efforts to make it produce it,
compelled resort to the SSS list as the next best source of information. After
all, the SSS list is a public record whose regularity is presumed. In Port
Workers Union of the Philippines (PWUP) v. Undersecretary of Labor and
Employment this Court underscored the policy of the Labor Code of
encouraging the holding of a certification election as the definitive and certain
way of ascertaining the choice of employees as to the labor organization in a
collective bargaining unit.
The petition for certiorari is DENIED for lack of merit.
PORT WORKERS UNION OF THE PHILIPPINES (PWUP), vs.

BIENVENIDO E. LAGUESMA
Facts:
The CBA between the workers of the International Container Terminal
Services, Inc. (ICTSI and Associate Port Checkers and Workers Union
(APCWU) was about to expire. Other unions were seeking to represent the
laborers in the negotiation of the next CBA and were already plotting their
moves. Sandigan ng Manggagawa sa Daungan (SAMADA) filed a petition
for certificationelection. The consent signatures of at least 25% of the
employees in the bargaining unit were submitted 11 days after the petition.
Port Workers Union of the Philippines (PWUP) filed a petition for
intervention. Still another petition for certification election was filed by
the Port Employees Association and Labor Union (PEALU), on April 6, 1990.
The consent signatures were submitted 35 days after the filing of the petition.
The petitions of SAMADA and PEALU were consolidated for joint decision.
APCWU filed a motion to dismiss them on the ground that they did not
comply with the requirement set forth in Section 6, Rule V, Book V of the
Implementing Rules, which requires that the signatures be submitted upon
filing of petition. This contention was upheld by the Med-Arbiter.
Issues:
WON respondent committed grave abuse of discretion in application of
Art 256 of theLabor Code
Held:
In line with the policy, the SC feel that the administrative rule requiring
the simultaneous submission of the 25% consent signatures upon the filing of
petition for certification election should not be strictly applied to frustrate the
determination of the legitimate representative of the workers. Significantly,
the requirement in the rule is not found in Article 256, the law it seeks to
implement. This is all the more reason why the regulation should at best be
given only a directory effect. Accordingly, we hold that the mere filing of a
petition for certification election within the freedom period is sufficient basis
for the issuance of an order for the holding of a certification election, subject
to the submission of the consent signatures within a reasonable period from
such filing.
SCOUT RAMON V. ALBANO MEMORIAL COLLEGE, vs. HON.
CARMELO C. NORIEL, and FEDERATION OF FREE WORKERS
(Scout Ramon V. Albano Memorial College Chapter),
Facts:
The controversy began with the filing of a petition for certification
election on September 22, 1977 by the Scout Ramon V. Albano Memorial
College Chapter of private respondent labor union. It alleged that the written
consent of 67 employees out of an alleged total working force of 200, more
or less, had been secured. There was, on October 21, 1977, a motion to dismiss
the petition filed by the employer, the present petitioner. It was based on the
lack of the 30% consent requirement as there were 250 employees, the
required thirty percent of the said work force being 75.
Issue:
Whether or not the Bureau of Labor Relations committed Grave Abuse
of Discretion when it ordered the holding of a petition for certification
election?
Held:
Petitioner has failed to make out a case. This court, in the aforesaid
PAFLU case, recognized that the Bureau of Labor Relations, in the exercise
of its sound discretion, may order a certification election notwithstanding the
failure to meet the 30% requirement. Once that requisite is complied with,
however, the Code makes it clear that "it shall be mandatory for the Bureau to
conduct a certification election for the purpose of determining the
representative of the employees in the appropriate bargaining unit and certify
the winner as the exclusive collective bargaining representative of all the
employees in the unit." Necessarily then, the argument of petitioner as to the
inability of the Union to come up with the required signatures when the
petition was first filed falls to the ground. At any rate, additional signatures
were subsequently secured. The allegation that there was thereafter a
retraction on the part of a number of such signatories lends added support to
the decision arrived at by respondent BLR that the only way of determining
with accuracy the true will of the personnel involved in the bargaining unitis
to conduct a certification petition At any rate, that is a factual matter, the
resolution of which by Bureau of Labor Relations is entitled to respect by this
court.
TODAY’S KNITTING VS NORIEL
Facts:
Philippine National Union Council, on April 1, 1976, filing with the
Bureau of Labor Relations a petition for the holding of a certification election.
Along with this were 200 signatures of Company’s employees confirming
such petition. A petition for intervention on behalf of petitioner Today’s
Knitting Free Workers Union. It saw no need for a certification election,
asserting that it had already been voluntarily recognized by the
management as the bargaining representative.
Med-Arbiter Eusebio M. Jimenez issued an order granting the petition

for certification election. The matter was then appealed to the Bureau of Labor
Relations. Appeal was denied. It ordered a certification election to be
conducted by the Bureau within twenty days from receipt of the resolution.
Hence this certiorari and prohibition petition with this Court
Issue:
Whether or not arbiter erred in granting the petition of a certificate
election in spite of the company’s recognition that another union is the
bargaining representative
Held:
NO. What is required is that the petition for certification election should
have in its favor “the written consent of at least 30% of all the employees in
the bargaining unit. The duty then cast on the Detector of Labor Relations is
to ascertain whether there has been such compliance. There is no doubt in this
case there was evidence that more than a total of two-hundred signatures were
obtained by respondent Union in seeking such a certification election. The
respondent Director having satisfied himself that the codal requisite had been
met, he had no choice but to order such certification. In the language of the
above provision, “it shall be mandatory for the Bureau to conduct a
certification election for the purpose of determining the representative of
the employees in the appropriate bargaining unit and certify the winner as the
exclusive collective bargaining representative of all the employees in the
unit.”
EAGLE RIDGE GOLF & COUNTRY CLUB vs. COURT OF APPEALS
and EAGLE RIDGEEMPLOYEES UNION
Facts:
Petitioner Eagle Ridge is a corporation engaged in the business of
maintaining golf courses. It had, at the end of CY 2005, around 112 rank-and-
file employees. On December 6, 2005, at least 20% of Eagle Ridge’s rank-
and-file employees—the percentage threshold required under Article 234(c)
of the Labor Code for union registration—had a meeting where they organized
themselves into an independent labor union, named "Eagle Ridge Employees
Union" (EREU or Union), elected a set of officers, and ratified their
constitution and by-laws. On December 19, 2005, EREU formally applied for
registration before the Department of Labor and Employment (DOLE)
Regional Office IV (RO IV). In time, DOLE RO IV granted the application.
The EREU then filed a petition for certification election in Eagle Ridge Golf
& Country Club. Eagle Ridge opposed this petition, followed by its filing of
a petition for the cancellation of the application.
Issue:
Whether there was fraud in the application to merit the cancellation of
the EREU’s registration
Held:
NO, a scrutiny of the records fails to show any misrepresentation, false
statement, or fraud committed by EREU to merit cancellation of its
registration. The Supreme Court succinctly explained this decision in eight
points: First. The Union submitted the required documents attesting to the
facts of the organizational meeting on December 6, 2005, the election of its
officers, and the adoption of the Union’s constitution and by-laws. Second.
The members of the EREU totaled 30 employees when it applied on
December 19, 2005 for registration. The Union thereby complied with the
mandatory minimum 20% membership requirement under Art. 234(c). Of
note is the undisputed number of 112 rank-and-file employees in Eagle Ridge,
as shown in the Sworn Statement of the Union president and secretary and
confirmed by Eagle Ridge in its petition for cancellation. Third. The Union
has sufficiently explained the discrepancy between the number of those who
attended the organizational meeting showing 26 employees and the list of
union members showing 30. The difference is due to the additional four
members admitted two days after the organizational meeting as attested to by
their duly accomplished Union Membership form.
S.S. VENTURES INTERNATIONAL, INC., PETITIONER, VS. S.S.
VENTURES LABOR UNION (SSVLU)
Facts:
Petitioner S.S. Ventures International, Inc. (Ventures), a PEZA-
registered export firm with principal place of business at Phase I-PEZA-
Bataan Export Zone, Mariveles, Bataan, is in the business of manufacturing
sports shoes. Respondent S.S. Ventures Labor Union (Union) is a labor
organization registered with the DOLE.
March 21, 2000, the Union filed with DOLE-Region III a petition for
certification election in behalf of the rank-and-file employees
August 21, 2000, Ventures filed a Petition to cancel the Union’s

certificate of registration alleging that the Union deliberately and maliciously
included the names of more or less 82 former employees no longer connected
with Ventures in its list of members who attended the organizational meeting
and in the adoption/ratification of its constitution and by-laws; that No
organizational meeting and ratification actually took place; and the Union’s
application for registration was not supported by at least 20% of the rank-and-
file employees of Ventures.
Regional Director of DOLE- Region III favored Ventures and resolved

to Cancel the Certificate of the union. On appeal, the BLR Director granted
the Union’s appeal and reversing the decision of RD. Ventures went to the
CA. The CA dismissed Ventures’ petition as well as the MR. Hence, this
petition for review
Issue:
Whether the registration of the Union must be cancelled.
Held:
NO. Whatever misgivings the petitioner may have with regard to the 82
dismissed employees is better addressed in the inclusion-exclusion
proceedings during a pre-election conference. The issue surrounding the
involvement of the 82 employees is a matter of membership or voter
eligibility. It is not a ground to cancel union registration.
For fraud and misrepresentation to be grounds for cancellation of union

registration under Article 239, the nature of the fraud and misrepresentation
must be grave and compelling enough to vitiate the consent of a majority of
union members.
ORIENTAL TIN CAN LABOR UNION, vs. SECRETARY OF LABOR
AND EMPLOYMENT
Facts:
Oriental Tin Can and Metal Sheet Manufacturing Company, Inc. (the
company) is engaged in the manufacture of tin can containers and metal
sheets. On March 3, 1994, it entered into a collective bargaining agreement
(CBA) with petitioner Oriental Tin Can Labor Union (OTCLU) as the existing
CBA was due to expire on April 15, 1994. Four days later, 248 of the
company’s rank-and-file employees authorized the Federation of Free
Workers (FFW) to file a petition for certification election. On March 10, 1994,
however, this petition was repudiated via a written waiver by 115 of the
signatories who, along with other employees totalling 897, ratified the CBA
on the same date.
Issue:
Whether or not the company has a personality to challenge the conduct
of a certification elections.
Held:
NONE. It is a well-established rule that certification elections are
exclusively the concern of employees; hence, the employer lacks the legal
personality to challenge the same. Law and policy demand that employers
take a strict, hands-off stance in certification elections. The bargaining
representative of employees should be chosen free from any extraneous
influence of management. A labor bargaining representative, to be effective,
must owe its loyalty to the employees alone and to no other.
Philippine Skylanders vs NLRC
Facts:
In November 1993 the Philippine Skylanders Employees Association
(PSEA), a local labor union affiliated with the Philippine Association of Free
Labor Unions (PAFLU), won in the certification election conducted among
the rank and file employees of Philippine Skylanders, Inc. (PSI). Its rival
union, Philippine Skylanders Employees Association-WATU (PSEA-
WATU) immediately protested the result of the election before the Secretary
of Labor.
Several months later, PSEA sent PAFLU a notice of disaffiliation.

PSEA subsequently affiliated itself with the National Congress of Workers
(NCW), changed its name to Philippine Skylanders Employees Association –
National Congress of Workers (PSEA-NCW), and to maintain continuity
within the organization, allowed the former officers of PSEA-PAFLU to
continue occupying their positions as elected officers in the newly-formed
PSEA-NCW.
Issue:
Whether or not PSEA’s disaffiliation is legitimate.
Held:
At the outset, let it be noted that the issue of disaffiliation is an inter-
union conflict the jurisdiction of which properly lies with the Bureau of Labor
Relations (BLR) and not with the Labor Arbiter.
There is nothing shown in the records nor is it claimed by PAFLU that

the local union was expressly forbidden to disaffiliate from the federation nor
were there any conditions imposed for a valid breakaway. As such, the
pendency of an election protest involving both the mother federation and the
local union did not constitute a bar to a valid disaffiliation.
It was entirely reasonable then for PSI to enter into a collective

bargaining agreement with PSEA-NCW. As PSEA had validly severed itself
from PAFLU, there would be no restrictions which could validly hinder it
from subsequently affiliating with NCW and entering into a collective
bargaining agreement in behalf of its members.
Policy considerations dictate that in weighing the claims of a local

union as against those of a national federation, those of the former must be
preferred. Parenthetically though, the desires of the mother federation to
protect its locals are not altogether to be shunned. It will however be to err
greatly against the Constitution if the desires of the federation would be
favored over those of its members. That, at any rate, is the policy of the law.
For if it were otherwise, instead of protection, there would be disregard and
neglect of the lowly workingmen.
TOYOTA MOTOR PHILIPPINES CORPORATION VS. TOYOTA
MOTOR PHILIPPINES CORPORATION WORKERS
ASSOCIATION
Facts:
In May 2000, Mediator-Arbiter Ma. Zosima Lameyra issued an order
certifying Toyota Motor Philippines Corporation Workers Association as the
exclusive bargaining agent of all Toyota rank-and-file employees. Toyota
filed a motion for reconsideration assailing the said order. Lameyra denied the
motion and Toyota eventually appealed the order before the DOLE Secretary.
This resulted to another rally within Toyota’s premises as the strikers

barricaded the entrances of Toyota preventing non-strikers from going to
work.
Issue:
Whether or not the strikes conducted by the Union on different
occasions are illegal.
Held:
Yes. The strike conducted before the BLR as well as the strike
conducted when the 227 employees were terminated is illegal because both
did not go through the proper procedure required by the Labor Code. It cannot
be said that the strike conducted before the BLR is beyond the ambit of the
strikes contemplated in the Labor Code. The Union argues that the “strike” is
actually a protest directed against the government and is covered by their
constitutional right to peaceably assemble and petition the government for
redress of grievances. The SC disagreed with this argument because the Union
failed to provide evidence that the Mediator-Arbiter was biased against them.
Further, if this were the kind of protest they were claiming, they should have
secured a rally permit. Further still, this case involves a labor dispute. The
employees may shroud their “strike” as mere demonstrations covered by the
constitution but in reality these are temporary work stoppages.
TAGAYTAY HIGHLANDS INTERNATIONAL GOLF CLUB INC vs

TAGAYTAY HIGHLANDS EMPLOYEES UNION-PGTWO
FACTS:
October 16, 1997, Tagaytay Highlands Employees Union (THEU),
Philippine Transport and General Workers Organization (PTGWO), a
legitimate labor organization said to represent majority of the rank-and-file
employees of THIGCI, filed a petition for certification election before the
DOLE Mediation-Arbitration Unit, Regional Branch No. IV.
On November 27, 1997 the petition was opposed for certification
election because the list of union members submitted by it was defective and
fatally flawed as it included the names and signatures of supervisors, resigned,
terminated and absent without leave (AWOL) employees, as well as
employees of The Country Club, Inc., a corporation distinct and separate from
THIGCI; and that out of the 192 signatories to the petition, only 71 were actual
rank-and-file employees of THIGCI. Also, some of the signatures in the list
of union members were secured through fraudulent and deceitful means, and
submitted copies of the handwritten denial and withdrawal of some of its
employees from participating in the petition.
ISSUE:
Whether or not the withdrawal of some union members from the
certification election will affect the result.
HELD:
NO. As for petitioner’ s allegation that some of the signatures in the
petition for certification election were obtained through fraud, false statement
and misrepresentation, the proper procedure is, as reflected above, for it to file
a petition for cancellation of the certificate of registration, and not to intervene
in a petition for certification election. Regarding the alleged withdrawal of
union members from participating in the certification election, this Court’s
following ruling is instructive:
“The best forum for determining whether there were indeed retractions
from some of the laborers is in the certification election itself wherein the
workers can freely express their choice in a secret ballot. Suffice it to say that
the will of the rank-and-file employees should in every possible instance be
determined by secret ballot rather than by administrative or quasi-judicial
inquiry. Such representation and certification election cases are not to be taken
as contentious litigations for suits but as mere investigations of a non-
adversary, fact-finding character as to which of the competing unions
represents the genuine choice of the workers to be their sole and exclusive
collective bargaining representative with their employer.”
Malayang Samahan ng mga Manggagawa sa M. Greenfield

(MSMGOUWP) v. Ramos, NLRC
Facts:
Petitioner MSMS, (local union) is an affiliate of ULGWP (federation).
The imposition of the fine became the subject of a bitter disagreement between
the Federation and the local union culminating to the latter’s declaration of
general autonomy from the former. Petitioner union officers received letters
from the administrator requiring them to explain why they should not be
removed from the office and expelled from union membership. The officers
were expelled from the federation. The federation advised the company of the
expulsion of the 30 union officers and demanded their separation pursuant to
the Union Security Clause in the CBA. The Federation filed a notice of strike
with the NCMB to compel the company to effect the immediate termination
of the expelled union officers. Under the pressure of a strike, the company
terminated the 30 union officers from employment. The petitioners filed a
notice of strike on the grounds of discrimination; interference; mass dismissal
of union officers and shop stewards; threats, coercion and intimidation ; and
union busting. The union members staged a walk-out and officially declared
a strike that afternoon. The strike was attended by violence.
Issue:
Whether or not the strike was illegal.
Held:
No. As to the legally of the strike; it was based on the termination
dispute and petitioners believed in good faith in dismissing them, the company
was guilty of ULP. A no-strike, no lockout provision in the CBA can only be
invoked when the strike is economic. As to the violence, the parties agreed
that the violence was not attributed to the striking employees alone as the
company itself hired men to pacify the strikers. Such violence cannot be a
ground for declaring the strike illegal.
TROPICAL HUT EMPLOYEES' UNION vs. TROPICAL HUT FOOD

MARKET, INC
FACTS:
On January 2, 1968, the rank and file workers of the Tropical Hut Food
Market Incorporated, organized a local union called the Tropical Hut
Employees Union (THEU), elected their officers, adopted their constitution
and by-laws and immediately sought affiliation with the National Association
of Trade Unions (NATU) concluded CBA with the company effective April
1, 1968 until March 31, 1971 although the said federation is not registered
with DOLE. In December 1973 some members of THEU NATU is
disaffiliating from NATU federation and affiliated with Confederation of
General Workers (CGW). NATU refused the disaffiliation of THEU and
notified them to answer and affirm their membership with THEU-NATU
within 48 hours however the employees failed to answer thus, THEU-NATU
enforced the union security clause set forth in the CBA, and requested
respondent company to dismiss them which the company heeded. It dismissed
63 employees, thus complaint were filed with NLRC for unfair labor practice
against the company which the court decided in favor of the employees and
on appeal to Secretary of Labor. The Secretary affirmed the decision of
NLRC. Hence, this petition for certiorari under Rule 65 seeking to set aside
the decisions of the public respondents Secretary of Labor and National Labor
Relations Commission which reversed the Arbitrators rulings in favor of
petitioners herein.
ISSUE:
Whether or not the dismissal of petitioner employees resulting from
their unions disaffiliation was illegal and constituted unfair labor practice on
the part of respondent company and federation.
HELD:
The Court finds that suspension of workers was hastily and summarily
done without the necessary due process. The respondent company sent a letter
to petitioners herein, advising them of NATU/Dilag's recommendation of
their dismissal and at the same time giving them forty-eight (48) hours within
which to comment. When petitioners failed to do so, respondent company
immediately suspended them and thereafter effected their dismissal. This is
certainly not in fulfillment of the mandate of due process, which is to afford
the employee to be dismissed an opportunity to be heard. The prerogative of
the employer to dismiss or lay-off an employee should be done without abuse
of discretion or arbitrariness, for what is at stake is not only the employee's
name or position but also his means of livelihood. Thus, the discharge of an
employee from his employment is null and void where the employee was not
formally investigated and given the opportunity to refute the alleged findings
made by the company. Likewise, an employer can be adjudged guilty of unfair
labor practice for having dismissed its employees in line with a closed shop
provision if they were not given a proper hearing.
Philippine Skylanders vs NLRC
Facts:
In November 1993 the Philippine Skylanders Employees Association
(PSEA), a local labor union affiliated with the Philippine Association of Free
Labor Unions (PAFLU), won in the certification election conducted among
the rank and file employees of Philippine Skylanders, Inc. (PSI). Its rival
union, Philippine Skylanders Employees Association-WATU (PSEA-
WATU) immediately protested the result of the election before the Secretary
of Labor.
Several months later, PSEA sent PAFLU a notice of disaffiliation.

PSEA subsequently affiliated itself with the National Congress of Workers
(NCW), changed its name to Philippine Skylanders Employees Association –
National Congress of Workers (PSEA-NCW), and to maintain continuity
within the organization, allowed the former officers of PSEA-PAFLU to
continue occupying their positions as elected officers in the newly-formed
PSEA-NCW.
Issue:
WON PSEA’s disaffiliation is legitimate.
Held:
At the outset, let it be noted that the issue of disaffiliation is an inter-
union conflict the jurisdiction of which properly lies with the Bureau of Labor
Relations (BLR) and not with the Labor Arbiter.
There is nothing shown in the records nor is it claimed by PAFLU that

the local union was expressly forbidden to disaffiliate from the federation nor
were there any conditions imposed for a valid breakaway. As such, the
pendency of an election protest involving both the mother federation and the
local union did not constitute a bar to a valid disaffiliation.
It was entirely reasonable then for PSI to enter into a collective

bargaining agreement with PSEA-NCW. As PSEA had validly severed itself
from PAFLU, there would be no restrictions which could validly hinder it
from subsequently affiliating with NCW and entering into a collective
bargaining agreement in behalf of its members.
Policy considerations dictate that in weighing the claims of a local

union as against those of a national federation, those of the former must be
preferred. Parenthetically though, the desires of the mother federation to
protect its locals are not altogether to be shunned. It will however be to err
greatly against the Constitution if the desires of the federation would be
favored over those of its members. That, at any rate, is the policy of the law.
For if it were otherwise, instead of protection, there would be disregard and
neglect of the lowly workingmen.
New Pacific Timber Supply Co. v. NLRC
FACTS:
The NFL was the sole and exclusive bargaining representative for the
rank and file employees of petitioner. NFL started to negotiate for better terms
and conditions of employment; which were met with resistance by Petitioner
Company. The NFL filed a complaint for ULP on the ground of refusal to
bargain collectively. LA issued an order declaring the company guilty of ULP
and ordering the CBA proposals submitted by the NFL as the CBA between
parties. Later, 186 of private respondents claiming they were wrongfully
excluded from the benefits under the CBA filed a petition for relief. Petitioner
asserts that private respondents are not parties to the agreement and may not
claim benefits thereunder. As for the CBA, petitioner maintains that the force
and effect of the CBA’s terms are limited to only three years and cannot
extend to terms and conditions which ceased to have force and effect.
ISSUES:
1. Whether or not the terms of an existing CBA as to its economic
provisions can be extended beyond the period stipulated therein, even
beyond the three year period prescribed by law, in the absence of a new
agreement.
2. Whether or not the rank and file employees hired after the term of the
CBA, considering their subsequent membership in the bargaining unit,
are parties to the agreement and may claim benefits thereunder.
HELD:
Yes. It is clear from Art. 253 that until a new CBA has been executed
by and between the parties; they are duly bound to keep the status quo and to
continue in full force and effect the terms and conditions of the existing
agreement. In the case at bar, no new agreement was entered between the
parties pending appeal of the decision in the NLRC. Consequently, the
employees from to the year 1985 (after expiration of the CBA) onwards would
be deprived of a substantial amount of monetary benefits if the terms and
conditions of the CBA were not to remain in force and effect which runs
counter to the intent of the Labor Cod to curb labor unrest and promote
industrial peace.
Yes. When a CBA is entered into by the union representing the

employees and the employer, even the non-union members are entitled to the
benefits of the contract. A laborer can claim benefits from a CBA entered into
the company and the union of which he is a member at the time of the
conclusion of the agreement even after he has resigned from said union.
Therefore, the benefits under the CBA should be extended to those who only
became such after it expired; to exclude them would constitute undue
discrimination.
ATTY MARINO ET. AL VS. DR GAMILLA ET. AL
Facts:
Petitioners are among the executive officers and directors of University
of Santo Tomas Faculty Union (USTFU) while respondents are composed of
UST faculty and USTFU members. The dispute arose when UST and USTFU,
represented by petitioners herein, entered a Memorandum of Agreement
(MOA) whereby UST faculty members belonging to the CBA unit were
granted additional economic benefits and at the same time stipulated a 10%
check-off over said benefits to cover union dues and special assessment for
Labor Education Fund and attorney’s fees. Respondents filed with the Med
Arbiter a complaint assailing, among others, the check-off for union dues and
attorney’s fees collected under the MOA for being violative of the rights and
conditions of membership in USTFU. DOLE Regional Director, by virtue of
an order consolidating all the complaints by the respondents, rendered among
others a decision in favor of the latter and ruled that the check-off collected as
negotiation fees were invalid.
Issue:
Is the check-off of union dues and special assessment of attorney’s fees
inserted in the written authorization ratifying the MOA benefits valid
Held:
NO. The economic benefits package granted under the MOA did not
constitute union funds from which attorney’s fees could have been validly
deducted. Under Article 222(b), attorney’s fees may only be paid from union
funds; yet the amount to be used in paying for the same does not become union
funds until it is actually deducted as attorney’s fees from the benefits awarded
to the employees. What the law requires is that the funds be already deemed
union funds even before the attorney’s fees are deducted or paid therefrom; it
does not become union funds after the deduction or payment. Furthermore,
the inclusion of the authorization for a check-off of union dues and special
assessments for the Labor Education Fund and attorney’s fees in the same
document for the ratification of the MOA granting the economic benefits
package, necessarily vitiated the consent of USTFU members for there was
no way for any individual union member to separate his or her consent to the
ratification of the MOA from his or her authorization of the check-off of union
dues and special assessments. As it were, the ratification of the MOA carried
with it the automatic authorization of the check-off of union dues and special
assessments in favor of the union. Substantial compliance is not enough in
view of the fact that the special assessment will diminish the compensation of
the union members. Their express consent is required, and this consent must
be obtained in accordance with the steps outlined by law, which must be
followed to the letter. No shortcuts are allowed.
MELITO L. PALACOL, vs. PURA FERRER-CALLEJA
Facts:
On October 12, 1987, the respondent Manila CCBPI Sales Force Union
(hereinafter referred to as the Union), as the collective bargaining agent of all
regular salesmen, regular helpers, and relief helpers of the Manila Plant and
Metro Manila Sales Office of the respondent Coca-Cola Bottlers
(Philippines), Inc. (hereinafter referred to as the Company) concluded a new
collective bargaining agreement with the latter. Among the compensation
benefits granted to the employees was a general salary increase to be given in
lump sum including recomputation of actual commissions earned based on the
new rates of increase.
Issue:
Whether or not a special assessment be validly deducted by a labor
union from the lump-sum pay of its members, granted under a collective
bargaining agreement (CBA), notwithstanding a subsequent disauthorization
of the same by a majority of the union members.
Held:
The Union failed to comply with the requirements of Article 241 of the
Labor Code. It held local membership meetings on separate occasions, on
different dates and at various venues, contrary to the express requirement that
there must be a general membership meeting. The contention of the Union
that "the local membership meetings are precisely the very general meetings
required by law" is untenable because the law would not have specified a
general membership meeting had the legislative intent been to allow local
meetings in lieu of the latter.
It submitted only minutes of the local membership meetings when what

is required is a written resolution adopted at the general meeting. Worse still,
the minutes of three of those local meetings held were recorded by a union
director and not by the union secretary. The minutes submitted to the
Company contained no list of the members present and no record of the votes
cast. Since it is quite evident that the Union did not comply with the law at
every turn, the only conclusion that may be made therefrom is that there was
no valid levy of the special assessment
Even assuming that the special assessment was validly levied, and
granting that individual written authorizations were obtained by the Union,
nevertheless there can be no valid check-off considering that the majority of
the union members had already withdrawn their individual authorizations. A
withdrawal of individual authorizations is equivalent to no authorization at
all. This is so even if the withdrawal of authorization was done in collective
form. There is nothing in the law which requires that the disauthorization must
be in individual form.
PACIFIC BANKING CORPORATION, Petitioner, vs JACOBO C.
CLAVE, et. Al
Facts:
This case is about the legality of deducting from the monetary benefits
awarded in a collective bargaining agreement the attorney’s fees of the lawyer
who assisted the union president in negotiating the agreement. It also involves
the jurisdiction of the Office of the President of the Philippines to order such
deduction.
The union officials requested the bank to withhold around P345,000 out
of the total benefits as ten percent attorney’s fees of Saavedra. At first, the
bank interposed no objection to the request in the interest of harmonious labor-
management relations. In theory, the actual ten percent attorney’s fees may
amount to more than one million pesos.
Issue:
Whether or not the Office of the President has jurisdiction to make an
adjudication on Saavedra’s attorney’s fees.
Held:
We hold that, under the circumstances, the Office of the President had
no jurisdiction to make an adjudication on Saavedra’s attorney’s fees. The
case was appealed with respect to the CBA terms and conditions, not with
respect to attorney’s fees. Although the fees were a mere incident,
nevertheless, the jurisdiction to fix the same and to order the payment thereof
was outside the pale of Clave’s appellate jurisdiction. He was right in adopting
a hands-off attitude in his first resolution and holding that the payment of the
fees was a question between the lawyer and the union.
Moreover, the case is covered squarely by the mandatory and explicit

prescription of article 222 which is another guarantee intended to protect the
employee against unwarranted practices that would diminish his
compensation without his knowledge and consent.
There is no doubt that lawyer Saavedra is entitled to the payment of his

fees but article 222 ordains that union funds should be used for that purpose.
The amount of P345,000 does not constitute union funds. It is money of the
employees. The union, not the employees, is obligated to Saavedra.
KIOK LOY VS. NLRC
FACTS:
In a certification election held, the Pambansang Kilusang Paggawa, a
legitimate labor federation won and was subsequently certified as the sole of
exclusive bargaining agent of the rank and file employees of Sweden Ice
Cream Plant. The union furnished the company with 2 copies of its proposed
collective bargaining agreement. At the same time, it requested the company
for its counter proposals but the request were ignored and remained unacted
upon by the company. As result, the union filed a notice of strike with the
BLR on the ground of unresolved economic issues.
The Labor arbiter decided that due to series of postponements, and non
appearance at the hearing conducted. IT ruled that the company has waived
its right to present further evidence and considered case submitted for
resolution. On appeal to NLRC it ruled that respondent Sweden Ice Cream is
guilty of unjustified refusal to bargain in violation of section (g) Article 248
(now Article 249).
ISSUE:
Whether or not, respondent is guilty of unjustified refusal to bargain.
HELD:
Yes. The court affirmed the NLRC, and ruled that, company is guilty
of unfair labor practice because jurisdictional preconditions of collective
bargaining establish such as: 1)Possession of majority representation; 2)Proof
of majority representation; 3)A demand to bargain under Article 251,
paragraph A collective bargaining which is defined as negotiation towards a
collective agreement is one of the democratic frameworks under the new
Labor Code, designed to stabilize the relation between labor and management
and to create a climate of sound and stable industrial peace. It is a mutual
responsibility of the employer and the union and is characterized as a legal
obligation.
In the case at bar, (1) respondent union is a duly certified bargaining

agent. (2) It made a definite request to bargain, accompanied with a copy of
the proposed collective bargaining agreement, to the company not only once
but twice which were left unanswered and unacted upon; and (3) the company
made no counter proposal whatsoever. All of which conclusively indicate
lack of sincere regard to negotiate. From the over all conduct of the company,
it is indubitably shown that it disregarded its obligation to bargain in good
faith.
UNITED EMPLOYEES UNION OF GELMART INDUSTRIES
PHILIPPINES (UEUGIP) vs. HON. CARMELO NORIEL
Facts:
The petition sought to have the certification election declared null and
void ab initio and thus unenforceable, alleging that the contending parties in
a pre-election conference conducted by the Bureau of Labor Relations agreed
that petitioner would be listed in the ballot as United Employees Union of
Gelmart Industries Philippines (UEUGIP). 2 In the notice of the certification
election, however, it was wilfully deleted and replaced by "a non-contending
party, namely, Philippine Social Security Labor Union (PSSLU), which,
although an existing labor federation ... has nothing to do and has no interest
or right of participation [therein]." 3 So it did appear likewise in the sample
ballot. 4 As a result, there was confusion in the minds of independent voters
and demoralization in the ranks of those inclined to favor petitioner. 5 There
was a protest but it was not based on this ground; instead the grievance
complained of referred to the alleged electioneering of nuns and a priest as
observers or inspectors on behalf of private respondent. 6 The above
notwithstanding, the certification election took place "on the scheduled date,
May 24, 1975 and respondent GATCORD garnered the highest number of
votes ...." 7 It was then set forth that despite such defect in the mode of
conducting the election which for petitioner sufficed to cause "the nullity of
the election in question," respondent Director Carmelo Noriel of the Bureau
of Labor Relations "[was] about to certify respondent GATCORD as the sole
and exclusive collective bargaining representative of the rank and file
employees [and] workers of Gelmart Industries Philippines, Inc.
Issue:
Whether or not the certification election be declared null and void ab
initio?
Held:
The petition lacks merit. What is equally important is that not only some
but all of them should have the right to do so." If heed be paid to the above
well-settled principle and applied to the facts disclosed in the present petition,
it would be apparent that the grievance spoken of is more fancied than real,
the assertion of confusion and demoralization based on conjecture rather than
reality. The mode and manner in which Antonio Diaz demonstrated how
militant and articulate he could be in presenting his side of the controversy
could hardly argue for the accuracy of his claim that his men did lose heart by
what appeared at the most to be an honest mistake, if it could be characterized
as one. Certainly then, the accusation that there was abuse of discretion, much
less a grave one, falls to the ground.
Rivera vs Espiritu
Facts:
PAL was suffering from a difficult financial situation in 1998. It was
faced with bankruptcy and was forced to adopt a rehabilitation plan and
downsized its labor force by more than 1/3. PALEA (PAL Employees
Association) went on a four-day strike to protest retrenchment measures in
July 1998. PAL ceased operations on Sep 23, 1998.
PALEA board again wrote the President on Sep 28, 1998. Among
others, it proposed the suspension of the PAL-PALEA CBA for a period of
ten years, subject to certain conditions. PALEA members accepted such terms
through a referendum on Oct 2, 1998. PAL resumed domestic operations on
Oct 7, 1998.
Seven officers and members of PALEA filed instant petition to annul

the September 27, 1998 agreement entered into between PAL and PALEA.
Issue:
Whether or not negotiations may be suspended for 10 years.
Held:
YES. CBA negotiations may be suspended for 10 years.
The assailed PAL-PALEA agreement was the result of voluntary collective
bargaining negotiations undertaken in the light of the severe financial
situation faced by the employer, with the peculiar and unique intention of not
merely promoting industrial peace at PAL, but preventing the latter’s closure.
There is no conflict between said agreement and Article 253-A of the
Labor Code. CBA under Article 253-A of the Labor Code has a two-fold
purpose. One is to promote industrial stability and predictability. Inasmuch as
the agreement sought to promote industrial peace, at the PAL during its
rehabilitation, said agreement satisfied the first purpose of said article. The
other purpose is to assign specific timetable, wherein negotiations become a
matter of right and requirement. Nothing in Article 253-A prohibits the parties
from waiving or suspending the mandatory timetable and agreeing on the
remedies to enforce the same.
SAN MIGUEL CORPORATION vs. NATIONAL LABOR RELATIONS

COMMISSION, SECOND DIVISION, AND SAN MIGUEL
CORPORATION EMPLOYEES UNION (SMCEU) – PTGWO
Facts:
San Miguel Corporation (SMC), declared 55 positions as
redundant. Consequently, the private respondent union (SMCEU) filed
several grievance cases for the said retrenched employees, praying for the
redeployment of the said employees to the other divisions of the
company. During the grievance proceedings, however, most of the employees
were redeployed, while others accepted early retirement. As a result, only 17
employees remained when the parties proceeded to the third level of the
grievance procedure. The private respondent filed with the National
Conciliation and Mediation Board (NCMB) of the Department of Labor and
Employment (DOLE) a notice of strike. Petitioner, on the other hand, moved
to dismiss the notice of strike, but the NCMB failed to act on the
motion. Respondent NLRC came out with a minute resolution dismissing the
complaint. Aggrieved by the resolution, petitioner found its way to this Court
via the present petition.
Issue:
Whether or not it is the duty of the NLRC to compel arbitration and to
enjoin a strike in violation of a no strike clause.
Held:
In the case under consideration, the grounds relied upon by the private
respondent union are non-strikeable. The issues which may lend substance to
the notice of strike filed by the private respondent union are: collective
bargaining deadlock and petitioner’s alleged violation of the collective
bargaining agreement. These grounds, however, appear more illusory than
real.
Collective Bargaining Deadlock is defined as “the situation between the
labor and the management of the company where there is failure in the
collective bargaining negotiations resulting in a stalemate” This situation, is
non-existent in the present case since there is a Board assigned on the third
level (Step 3) of the grievance machinery to resolve the conflicting views of
the parties. For failing to exhaust all the steps in the grievance machinery and
arbitration proceedings provided in the Collective Bargaining Agreement, the
notice of strike should have been dismissed by the NLRC and private
respondent union ordered to proceed with the grievance and arbitration
proceedings
As regards the alleged violation of the CBA, we hold that such a

violation is chargeable against the private respondent union. In abandoning
the grievance proceedings and stubbornly refusing to avail of the remedies
under the CBA, private respondent violated the mandatory provisions of the
collective bargaining agreement.
NATIONAL UNION OF RESTAURANT WORKERS vs. CIR
Facts:
On June 9, 1960, a complaint for unfair labor practice was lodged
against the owners of Tres Hermanas Restaurant, particularly Mrs. Felisa
Herrera, on the ground, among others, that respondents refused to bargain
collectively with the complaining union; respondents made a counter-
proposal in the sense that they would bargain with said union and would
accept its demands if the same would become a company union, an done
Martin Briones, an employee, was separated from the service because he was
found to be the organizer and adviser of the complaining union. Respondents
denied the charges, and they were exonerated. The judge found that the
charges were not proven and dismissed the complaint.
Issue:
Whether or not respondents refused to bargain collectively with the
union and committed unfair labor.
Held:
NO. The court cited several instances that showed respondent’s
willingness to bargain with the union. It is true that under Sec 14, RA 875
whenever a party serves a written notice upon the employer making some
demands the latter shall reply thereto not later than 10 days from receipt
thereof, but this condition is merely procedural, and as much its non-
compliance cannot be deemed to be an act of unfair labor practice. The fact is
respondents did not ignore the letter sent by the union so much so that they
called a meeting to discuss its demands. The court also pointed out the
markings on the letter made by respondent in the meeting with the union on
May 3, 1960 at their restaurant in Quezon City, indicating the willingness and
actual bargaining made with the union. (Check for agreement, a cross for
disapproval and a circle for demands left open for further discussion)It is
contended that respondents refused to bargain with the complaining union as
such even if they called a meeting of its officers and employees hereby
concluding that they did not desire to enter into a bargaining agreement with
said union. It is belied by the fact that respondents did actually agree and
bargain with the representatives of the union. Respondents were of the
impression that before a union could have that capacity it must first be
certified by the CIR as the duly authorized bargaining unit, which they also
stated in their answer to the petition for certification filed by said union before
the CIR. In that case, another union known as the International Labor and
Marine Union of the Philippines claimed to represent the majority of the
employees of respondent restaurant, and this is what it alleged in a letter sent
to the manager of respondents dated May 25, 1962.
Facts:
Petitioner accused the union officers of bargaining in bad faith before
the National Labor Relations Commission (NLRC). Labor Arbiter Edgardo
M. Madriaga decided in favor of petitioner. However, the Labor Arbiter's
decision was reversed on appeal before the NLRC.
On January 1996, the union notified the National Conciliation and

Mediation Board (NCMB) of its intention to strike on the grounds (sic) of
petitioner's: non-compliance with the NLRC (1) order to delete the name of
Atty. Federico Leynes as the union's legal counsel; and (2) refusal to bargain.
The parties agreed to disregard the unsigned CBA and to start negotiation on
a new five-year CBA starting 1994-1999. On February 7, 1996, the union
submitted its proposals to petitioner, which notified the union six days later
or on February 13, 1996 that the same had been submitted to its Board of
Trustees. In the meantime, Ambas was informed through a letter dated
February 15, 1996 from her superior that her work schedule was being
changed from Monday to Friday to Tuesday to Saturday. Ambas protested and
requested management to submit the issue to a grievance machinery under the
old CBA.
Issue:
Whether or not the termination of the union president amounts to an
interference of the employees' right to self-organization
Held:
The petition is without merit. In the case at bar, the lifetime of the
previous CBA was from 1989-1994. The petition for certification election by
ACEC, allegedly a legitimate labor organization, was filed with the
Department of Labor and Employment (DOLE) only on May 26, 1996.
Clearly, the petition was filed outside the sixty-day freedom period. Hence,
the filing thereof was barred by the existence of a valid and existing collective
bargaining agreement. Consequently, there is no legitimate representation
issue and, as such, the filing of the petition for certification election did not
constitute a bar to the ongoing negotiation.
GENERAL MILLING CORPORATION VS. HON. COURT OF
APPEALS
Facts:
General Milling Corporation employed 190 workers. All the employees
were members of a union which is a duly certified bargaining agent. The GMC
and the union entered into a collective bargaining agreement which included
the issue of representation that is effective for a term of three years which will
expire on November 30, 1991. On November 29, 1991, a day before the
expiration of the CBA, the union sent GMC a proposed CBA, with a request
that a counter proposal be submitted within ten days. on October 1991, GMC
received collective and individual letters from the union members stating that
they have withdrawn from their union membership. On December 19, 1991,
the union disclaimed any massive disaffiliation of its union members. On
January 13, 1992, GMC dismissed an employee who is a union member. The
union protected the employee and requested GMC to submit to the grievance
procedure provided by the CBA, but GMC argued that there was no basis to
negotiate with a union which is no longer existing. The union then filed a case
with the Labor Arbiter but the latter ruled that there must first be a certification
election to determine if the union still enjoys the support of the workers.
Issue:
Whether or not GMC is guilty of unfair labor practice for violating its
duty to bargain collectively and/or for interfering with the right of its
employees to self-organization.
Held:
GMC is guilty of unfair labor practice when it refused to negotiate with
the union upon its request for the renegotiation of the economic terms of the
CBA on November 29, 1991. the union’s proposal was submitted within the
prescribed 3-year period from the date of effectivity of the CBA. It was
obvious that GMC had no valid reason to refuse to negotiate in good faith with
the union. The refusal to send counter proposal to the union and to bargain
anew on the economic terms of the CBA is tantamount to an unfair labor
practice under Article 248 of the Labor Code.
Under Article 252 of the Labor Code, both parties are required to
perform their mutual obligation to meet and convene promptly and
expeditiously in good faith for the purpose of negotiating an agreement. The
union lived up to this obligation when it presented proposals for a new CBA
to GMC within 3 years from the effectivity of the original CBA. But GMC
failed in its duty under Article 252. What it did was to devise a flimsy excuse,
by questioning the existence of the union and the status of its membership to
prevent any negotiation. It bears stressing that the procedure in collective
bargaining prescribed by the Code is mandatory because of the basic interest
of the state in ensuring lasting industrial peace. The Court of Appeals found
that the letters between February to June, 1993 by 13 union members
signifying their resignation from the union clearly indicated that GMC exerted
pressure on the employees. We agree with the Court of Appeals’ conclusion
that the ill-timed letters of resignation from the union members indicate that
GMC interfered with the right of its employee to self-organization.
NISSAN MOTORS PHILIPPINES vs.

SECRETARY OF LABOR AND EMPLOYMENT and BAGONG
NAGKAKAISANG LAKAS SA NISSAN MOTOR PHILIPPINES, INC.
(BANAL-NMPI-OLALIA-KMU)
FACTS:
On August 22, 2001, the Department of Labor and Employment
(DOLE), upon Nissan Motor’s petition, issued an order assuming jurisdiction
over the dispute at Nissan Motor. In it, the DOLE Secretary expressly enjoined
any strike or lockout and directed the parties to cease and desist from
committing any act that might exacerbate the situation, and for the Union to
refrain from any slowdown and other similar activities that may disrupt
company operations or bring its production to below its normal and usual
levels. Nissan Motor faults the CA for effectively ordering, like the public
respondent Secretary, the reinstatement of the 140 rank-and-file Union
members who waged a work slowdown notwithstanding the assumption of
jurisdiction order dated August 22, 2001 and what amounts to reiterated
return-to-work orders (RTWO) dated September 12 and 28, 2001. The public
respondent Secretary, Nissan Motors notes, had found the dismissal of the
Union officers to be justified.
ISSUE:
Whether or not economic aspects of the CBA should conform to the
Company’s financial status?
HELD:
The disposition made by the public respondent Secretary relating to the
economic aspects of the CBA, such as, but not limited, transportation
allowance, 14th month pay, seniority pay, separation pay and the effectivity of
the new CBA, appears to be proper. However, conformably with the evidence
on record that shows the Company’s precarious financial position, there is a
need to modify the other awards she thus made:
Parenthetically, the Company’s lament about the public respondent

Secretary being in error when she proceeded to extend to members of the rank-
and-file of the bargaining unit the privilege of obtaining half a month’s
pay/salary by way of a salary loan for the employee’s benefit or that of the
immediate members of his family every start of the semestral school year is
unacceptable. According to the Company, such arrangement, as opposed to
the present practice wherein the Company accords a P5,000.00 educational
loan semestrally for its employees or that of the immediate members of the
employee’s family, while seemingly innocuous, would in reality weigh
heavily on its finances.
Far from being burdensome and confiscatory, as argued by the

Company, this particular award appears to the Court, as it did to the CA and
the DOLE, to be reasonable and modest increase in benefits, being in the form
of a loan. A loan suggests repayment. At the end of the day, therefore, the
Company will get its money back and will be doing its share to promote
industrial peace.
PENTAGON STEEL VS. COURT OF APPEALS
Facts:
The petitioner, a corporation engaged in the manufacture of G.I. wire
and nails, employed respondent Perfecto Balogo (the respondent) since
September 1, 1979 in its wire drawing department. The petitioner alleged that
the respondent absented himself from work on August 7, 2002 without giving
prior notice of his absence. As a result, the petitioner sent him a letter by
registered mail dated August 12, 2002, written in Filipino, requiring an
explanation for his absence. The petitioner sent another letter to the
respondent on August 21, 2002, also by registered mail, informing him that
he had been absent without official leave (AWOL) from August 7, 2002 to
August 21, 2002. Other letters were sent to the respondent by registered mail,
all pointing out his absences; however, the respondent failed to respond. Thus,
the petitioner considered him on AWOL from August 7, 2002.
Issue:
Whether or not the respondent, Perfecto Balogo was illegally dismissed
Held:
The petition has no merit. Mr. Balogo was illegally dismissed and be
reinstated. The Court take note of the undisputed fact that the respondent had
been in the petitioner’s employ for 23 years. Prior to his dismissal, the
respondent’s service record was unblemished having had no record of
infraction of company rules. As the NLRC correctly held, we find it difficult
to accept the petitioner’s allegation that the respondent absented himself for
unjustifiable reasons with the intent to abandon his job. To our mind,
abandonment after the respondent’s long years of service and the consequent
surrender of benefits earned from years of hard work are highly unlikely.
Under the given facts, no basis in reason exists for the petitioner’s theory that
the respondent abandoned his job.The records disclose that respondent has
been in the petitioner’s employ for 23 years and has no previous record of
inefficiency or infraction of company rules prior to his illegal dismissal from
service. We significantly note that payment of separation pay in lieu of
respondent’s reinstatement will work injustice to the latter when considered
with his long and devoted years in the petitioner’s service. Separation pay may
take into account the respondent’s past years of service, but will deprive the
respondent of compensation for the future productive years that his security
of tenure protects. We take note, too, that the respondent, after 23 years of
service, shall in a few years retire; any separation pay paid at this point cannot
equal the retirement pay due the respondent upon retirement.
DAVAO INTEGRATED PORT STEVEDORING SERVICES vs.

RUBEN V. ABARQUEZ
FACTS:
Petitioner and private respondent and the exclusive collective
bargaining agent of the rank and file workers entered into CBA the Company
agrees to grant 15 days sick leave with pay each year to every regular non-
intermittent worker who already rendered at least one year of service, and if
the same is not enjoyed within one year period of the current year, any
unenjoyed portion thereof, shall be converted to cash and shall be paid at the
end of the said one year period. And provided however, that only those regular
workers of the company whose work are not intermittent, are entitled to the
herein sick leave privilege.
Upon its renewal, the coverage of the said benefits was expanded to
include the "present Regular Extra Labor Pool as of the signing of this
Agreement. Also, all the field workers of petitioner who are members of the
regular labor pool and the present regular extra labor pool hours were
extended sick leave with pay benefits. Any unenjoyed portion thereof at the
end of the current year was converted to cash and paid. The commutation of
the unenjoyed portion of the sick leave with pay benefits of the intermittent
workers or its conversion to cash was, however, discontinued or withdrawn
when petitioner-company under a new assistant manager, Mr. Benjamin
Marzo, stopped the payment of its cash equivalent on the ground that they are
not entitled to the said benefits under Sections 1 and 3 of the 1989 CBA.
The Union objected said discontinuance because it would violate the principle
in labor laws that benefits already extended shall not be taken away and that
it would result in discrimination between the non-intermittent and the
intermittent workers of the petitioner-company. The Union brought it before
the NCMB and said public respondent issued an award in favour of the Union.
ISSUE:
Whether or not the intermittent field workers are entitled to conversion
to cash of any unused sick leave?
HELD:
The Supreme Court dismissed the petition. It was said that CBA is not
an ordinary contract but impressed with public interest, thus it must yield to
the common good.
It is thus erroneous for petitioner to isolate Section 1, Article VIII of

the 1989 CBA from the other related section on sick leave with pay benefits,
specifically Section 3 thereof, in its attempt to justify the discontinuance or
withdrawal of the privilege of commutation or conversion to cash of the
unenjoyed portion of the sick leave benefit to regular intermittent workers
because well-settled is it that the said privilege of commutation or conversion
to cash, being an existing benefit, the petitioner-company may not unilaterally
withdraw, or diminish such benefits.
It is a fact that petitioner-company had, on several instances in the past,

granted and paid the cash equivalent of the unenjoyed portion of the sick leave
benefits of some intermittent workers.
NEW PACIFIC TIMBER SUPPLY COMPANY, CO., INC. vs.

NATIONAL LABOR RELATIONS COMMISSION, MUSIB M. BUAT,
LEON G. GONZAGA, JR., ET AL., NATIONAL FEDERATION OF
LABOR, MARIANO AKILIT and 350 OTHERS
FACTS:
The National Federation of Labor (NFL) was certified as the sole and
exclusive bargaining representative of all the regular rank-and-file employees
of petitioner Company. As such, NFL started to negotiate for better terms and
conditions of employment but the same was allegedly rejected by Petitioner
Company, so that the former was prompted to file a complaint for ULP. The
LA issued an order declaring (a) petitioner Company guilty of ULP; and (b)
the CBA proposals submitted by the NFL as the CBA. Petitioner’s appeal—
and later certiorari—were both dismissed. Petitioner Company complied with
the LA’s order; and, the case was considered closed following NFL's
manifestation that it will no longer appeal said order. However,
notwithstanding such manifestation, a "Petition for Relief" was filed in behalf
of 186 of the private respondents who claimed that they were wrongfully
excluded from enjoying said benefits since the agreement with NFL and
petitioner Company limited the CBA's implementation to only the 142 rank-
and-file employees enumerated. They claimed that NFL's misrepresentations
had precluded them from appealing their exclusion. NLRC issued a resolution
declaring that the 186 excluded employees as part of the existing rank-and-
file bargaining unit and were, therefore, entitled to the benefits under the
CBA. Meanwhile, the private respondents, including the original 186 filed
individual money claims but LA Villena dismissed these cases. The NLRC
set aside the dismissal orders for lack of legal basis. Hence the instant petition.
ISSUES:
A) May the term of a CBA as to its economic provisions be extended
beyond the term expressly stipulated therein, and, in the absence of a new
CBA, even beyond the three-year period provided by law? B) Are employees
hired after the stipulated term of a CBA entitled to the benefits provided there
under?
HELD:
A) YES. It is clear from Article 253 that until a new CBA as been
executed, the parties are duty-bound to keep the status quo and to continue in
full force and effect the terms and conditions of the existing agreement. In the
case at bar, the existing CBA in its entirety, continued to have legal effect.
The automatic renewal clause provided for by the law, which is deemed
incorporated in all CBA's, provides the reason why the new CBA can only be
given a prospective effect. To rule otherwise would be to create a gap during
which no agreement would govern, from the time the old contract expired to
the time a new agreement shall have been entered into. Consequently, the
employees from the year 1985 onwards would be deprived of a substantial
amount of monetary benefits which runs contrary to the very intent and
purpose of Articles253 and 253-A of the Labor Code which is to curb labor
unrest and to promote industrial peace; B) YES. In a long line of cases, this
Court has held that when a collective bargaining contract is entered into by
the union and the employer, even the non-member employees are entitled to
the benefits of the contract. In the same vein, the benefits under the CBA in
the instant case should be extended to those employees who only became such
after 1984.
MACTAN WORKERS UNION and TOMAS FERRER, as President

thereof vs. DON RAMON ABOITIZ, President, Cebu Shipyard &
Engineering Works, Inc.
FACTS:
Defendant Cebu Shipyard & Engineering Works, Inc. in Lapulapu City
is employing laborers and employees belonging to two rival labor unions. 72
of these laborers whose names appear in the complaint are affiliated with the
Mactan Workers Union while the rest are members of the intervenor
Associated Labor Union. Defendant Cebu Shipyard & Engineering Works,
Inc. and the Associated Labor Union entered into a CBA ... The Company
agrees to give a profit-sharing bonus to its employees and laborers to be taken
from ten per cent (10%) of its net profits or net income derived from the direct
operation of its shipyard and shop in Lapulapu to be payable in two (2)
installments, the first installment being payable in March and the second
installment in June, each year out of the profits in agreement. Said profit-
sharing bonus shall be paid by the Company to Associated Labor Union to be
delivered by the latter to the employees and laborers concerned and it shall be
the duty of the Associated Labor Union to furnish and deliver to the Company
the corresponding receipts duly signed by the laborers and employees entitled
to receive the profit-sharing bonus. If unaacepted, the profit-sharing bonus
which the said employee or laborer is entitled under this Agreement, will be
returned to the Company. The members of the Mactan Workers Union failed
to receive their shares in the second installment of bonus because they did not
like to go to the office of the ALU to collect their shares. In accordance with
the terms of the CBA, the uncollected shares of the plaintiff union members
was returned by the ALU to the defendant corporation. At the same time the
defendant corporation was advised by the ALU not to deliver the said amount
to the members of the Mactan Workers Union unless ordered by the Court.
For the recovery of claim, this case was filed with the lower court and
rendered decision in favor of the plaintiffs. Hence this appeal by intervenor
Associated Labor Union.
ISSUE:
Whether or not the lower court erred in requiring literal compliance
with the terms of a collective bargaining contract?
HELD:
The terms and conditions of a collective bargaining contract constitute
the law between the parties. Those who are entitled to its benefits can invoke
its provisions. Nor does it suffice as a defense that the claim is made on behalf
of non-members of intervenor Associated Labor Union, for it is a well-settled
doctrine that the benefits of a collective bargaining agreement extend to the
laborers and employees in the collective bargaining unit, including those who
do not belong to the chosen bargaining labor organization. Any other view
would be a discrimination on which the law frowns. The labor union that gets
the majority vote as the exclusive bargaining representative does not act for
its members alone. It represents all the employees in such a bargaining unit.
How can the allegation of a lack of a cause of action be taken seriously when
precisely there was a right violated on the part of the members of plaintiff
Mactan Workers Union, a grievance that called for redress? The assignment
of error that the City Court of Lapulapu was bereft of jurisdiction is singularly
unpersuasive.
DAVAO INTEGRATED PORT STEVEDORING SERVICES vs.

RUBEN V. ABARQUEZ
FACTS:
Petitioner and private respondent and the exclusive collective
bargaining agent of the rank and file workers entered into CBA the Company
agrees to grant 15 days sick leave with pay each year to every regular non-
intermittent worker who already rendered at least one year of service, and if
the same is not enjoyed within one year period of the current year, any
unenjoyed portion thereof, shall be converted to cash and shall be paid at the
end of the said one year period. And provided however, that only those regular
workers of the company whose work are not intermittent, are entitled to the
herein sick leave privilege.
Upon its renewal, the coverage of the said benefits was expanded to
include the "present Regular Extra Labor Pool as of the signing of this
Agreement. Also, all the field workers of petitioner who are members of the
regular labor pool and the present regular extra labor pool hours were
extended sick leave with pay benefits. Any unenjoyed portion thereof at the
end of the current year was converted to cash and paid. The commutation of
the unenjoyed portion of the sick leave with pay benefits of the intermittent
workers or its conversion to cash was, however, discontinued or withdrawn
when petitioner-company under a new assistant manager, Mr. Benjamin
Marzo, stopped the payment of its cash equivalent on the ground that they are
not entitled to the said benefits under Sections 1 and 3 of the 1989 CBA.
The Union objected said discontinuance because it would violate the principle
in labor laws that benefits already extended shall not be taken away and that
it would result in discrimination between the non-intermittent and the
intermittent workers of the petitioner-company. The Union brought it before
the NCMB and said public respondent issued an award in favour of the Union.
ISSUE:
Whether or not the intermittent field workers are entitled to conversion
to cash of any unused sick leave?
HELD:
The Supreme Court dismissed the petition. It was said that CBA is not
an ordinary contract but impressed with public interest, thus it must yield to
the common good.
It is thus erroneous for petitioner to isolate Section 1, Article VIII of

the 1989 CBA from the other related section on sick leave with pay benefits,
specifically Section 3 thereof, in its attempt to justify the discontinuance or
withdrawal of the privilege of commutation or conversion to cash of the
unenjoyed portion of the sick leave benefit to regular intermittent workers
because well-settled is it that the said privilege of commutation or conversion
to cash, being an existing benefit, the petitioner-company may not unilaterally
withdraw, or diminish such benefits.
It is a fact that petitioner-company had, on several instances in the past,

granted and paid the cash equivalent of the unenjoyed portion of the sick leave
benefits of some intermittent workers.
PANAY ELECTRIC COMPANY, INC vs NATIONAL LABOR

RELATIONS COMMISSION, FOURTH DIVISION AND PANAY
ELECTRIC COMPANY EMPLOYEES AND WORKERS
ASSOCIATION
FACTS:
The EDP/Personnel Manager Panay Electric Company, Inc
recommended Enrique Huyan to assume the responsibility of gathering
accounting and computer data at its power plant who was at the time an
Administrative Personnel Assistant at the head office.
After an administrative investigation Huyan was ordered dismissed ont

the ground of insubordination for his failure to conform with the
recommendation.
Petitioner assails NLRC's decision insofar as it has adjudged monetary

awards to private respondents Huyan and Napiar and in not sanctioning the
dismissal of other union officers and members.
ISSUE:
Whether or not the NLRC erred in granting separation benefits to
Huyan and Napiar, in awarding moral and exemplary damages to the former,
and in merely sanctioning the suspension, instead of terminating the
employment status, of other officers and members of respondent labor union.
HELD:
In the case of the other union officers, however, the NLRC, having
found no sufficient proof to hold them guilty of "bad faith" in taking part in
the strike or of perpetrating "serious disorders" during the concerted activity,
merely decreed suspension. We see no grave abuse of discretion by the NLRC
in this regard and in not thus ordering the dismissal of said officers.
In the case of Huyan, we sustain the NLRC in holding that he, during
the period of his illegal suspension should be entitled to back salaries and
benefits plus moral damages, but in the reduced amount of P10,000.00, in
view of the findings of the NLRC. Exemplary damages, upon the other hand,
are awarded only when a person acts in a wanton, fraudulent, reckless,
oppressive or malevolent manner NLRC's findings fall short of the
underhandedness required so as to justify this award.
Manila Electric Co. v. Quisumbing
Facts:
The court directed the parties to execute a CBA incorporating the terms
among which are the following modifications: Wages: PhP 1,900 for 1995-
1996; Retroactivity: December 28, 1996-Dec. 1999, etc. Dissatisfied, some
members of the union filed a motion for intervention/reconsideration.
Petitioner warns that if the wage increase of Php2,000.00 per month as ordered
is allowed, it would pass the cost covering such increase to the consumers
through an increased rate of electricity. On the retroactivity of the CBA
arbitral award, the parties reckon the period as when retroaction shall
commence.
Issue:
Whether or not retroactivity of arbitral awards shall commence at such
time as granted by the Secretary
Held:
In St. Luke’s Medical vs. Torres, a deadlock developed during CBA
negotiations between management unions. The Secretary assumed
jurisdiction and ordered the retroaction of the CBA to the date of expiration
of the previous CBA. The Court ratiocinated thus: In the absence of a specific
provision of law prohibiting retroactivity of the effectivity of arbitral awards
issued by the Secretary pursuant to article 263(g) of the Labor Code, public
respondent is deemed vested with the plenary and discretionary powers to
determine the effectivity thereof.
In general, a CBA negotiated within six months after the expiration of

the existing CBA retroacts to the day immediately following such date and if
agreed thereafter, the effectivity depends on the agreement of the parties. On
the other hand, the law is silent as to the retroactivity of a CBA arbitral award
or that granted not by virtue of the mutual agreement of the parties but by
intervention of the government. In the absence of a CBA, the Secretary’s
determination of the date of retroactivity as part of his discretionary powers
over arbitral awards shall control.
Wherefore, the arbitral award shall retroact from December 1, 1995 to

November 30, 1997; and the award of wage is increased from Php1,900 to
Php2,000.
PICOP RESOURCES, INCORPORATED (PRI), vs ANACLETO L.

TAÑECA, GEREMIAS S. TATO, JAIME N. CAMPOS, MARTINIANO
A. MAGAYON, JOSEPH B. BALGOA, MANUEL G. ABUCAY et al.
FACTS:
Respondents Anacleto Tañeca, Loreto Uriarte, Joseph Balgoa, Jaime
Campos, Geremias Tato, Martiniano Magayon, Manuel Abucay and fourteen
(14) others filed a Complaint for unfair labor practice, illegal dismissal and
money claims against petitioner.
Respondents alleged that none of them ever withdrew their membership
from NAMAPRI-SPFL or submitted to PRI any union dues and check-off
disauthorizations against NAMAPRI-SPFL. They insisted that mere
affixation of signature on such authorization to file a petition for certification
election was not per se an act of disloyalty. They claimed that while it may be
true that they signed the said authorization before the start of the freedom
period, the petition of FFW was only filed with the DOLE on May 18, 2000,
or 58 days after the start of the freedom period.
ISSUE:
(1) Whether an existing collective bargaining agreement can be given
its full force and effect in all its terms and condition including its union
security clause, even beyond the 5-year period when no new CBA has yet
been entered into.
(2) Whether there was just cause to terminate the employment of
respondents.
HELD:
While it is incumbent for the employer to continue to recognize the

majority status of the incumbent bargaining agent even after the expiration of
the freedom period, they could only do so when no petition for certification
election was filed. The reason is, with a pending petition for certification, any
such agreement entered into by management with a labor organization is
fraught with the risk that such a labor union may not be chosen thereafter as
the collective bargaining representative.
There is no sufficient evidence to support the decision of PRI to

terminate the employment of the respondents.
Manila Central Line Corp. v. Manila Central Manila Free Workers

Union
Facts:
This case arose out of a collective bargaining deadlock between
petitioner and private respondent Manila Central Line Free Workers Union-
National Federation of Labor. The parties’ collective bargaining agreement
had expired on March 15, 1989. As the parties failed to reach a new
agreement, private respondent sought the aid of the National Conciliation and
Mediation Board on October 30, 1989, but the deadlock remained unresolved.
At the initial hearing before the Labor Arbiter, the parties declared that
conciliation efforts before the NCMB had terminated and it was their desire
to submit the case for compulsory arbitration. Accordingly, they were
required to submit their position papers and proposals, which they did, and in
which they indicated portions of their respective proposals to which they
agree, leaving the rest for arbitration.
The LA ordered the petitioner Union and the respondent Company to

execute and formalize their new five-year collective bargaining agreement
(CBA) retroactive to the date of expiry of the 1986-1989 CBA within thirty
(30) days from receipt of the Decision. Petitioner appealed, but its appeal was
denied by the NLRC.
Issue:
Whether the CBA entered into by the parties may be given retroactive
effect.
Held:
Art. 253-A refers to collective bargaining agreements entered into by
the parties as a result of their mutual agreement. The CBA in this case, on the
other hand, is part of an arbitral award. As such, it may be made retroactive to
the date of expiration of the previous agreement.
Therefore, in the absence of a specific provision of law prohibiting

retroactivity of the effectivity of arbitral awards issued by the Secretary of
Labor pursuant to Article 263(g) of the Labor Code, such as herein involved,
public respondent is deemed vested with plenary and discretionary powers to
Sundowner Dev’t Corp. v. Drilon
Facts:
Private respondent Hotel Mabuhay, Inc. leased the premises belonging
to Syjuco . However, due to non-payment of rentals, a case for ejectment was
filed by Syjuco. Mabuhay offered to amicably settle the case by surrendering
the premises and to sell its assets and personal property to any interested party.
Syjuco offered the said premises for lease to petitioner and formally
turned over the possession of the leased premises to petitioner. Meanwhile,
respondent National Union of Workers in Hotel, Restaurant and Allied
Services (NUWHRAIN) picketed the leased premises, barricaded the entrance
to the leased premises and denied petitioner’s officers, employees and guests
free access to and egress from said premises.
Public respondent Secretary of Labor, assuming jurisdiction over the

dispute, issued an order requiring all striking employees to return to work. The
parties were also directed to submit their respective position papers within ten
(10) days from receipt of the order.
Public respondent then issued an order requiring petitioner to absorb

the members of the union and to pay backwages from the time it started
operations up to the date of the order.
Issue:
Whether petitioner should absorb employees of Mabuhay and pay them
their backwages
Held:
In the case at bar, contrary to the claim of the public respondent that the
transaction between petitioner and Mabuhay was attended with bad faith, the
court finds no cogent basis for such contention. Thus, the absorption of the
employees of Mabuhay may not be imposed on petitioner.
Mabuhay had nothing to do with the negotiation and consummation of

the lease contract between petitioner and Syjuco. It was only when Mabuhay
offered to sell its assets and personal properties in the premises to petitioner
that they came to deal with each other. It appears that petitioner agreed to
purchase said assets of respondent Mabuhay to enable Mabuhay to pay its
obligations to its striking employees and to Syjuco.
Manlimos v. NLRC
Facts:
The petitioners were among the regular employees of the Super
Mahogany Plywood Corporation, who had been hired as patchers, taper-
graders, and receivers-dryers. When a new owner acquired complete
ownership of the corporation, the petitioners continued to work and were
considered terminated, with their conformity when they received their
separation pay, 13th month pay, and all other benefits due them computed as
of the said month. Each of them then executed a Release and Waiver.
When the new owner caused the publication of a notice for the hiring
of workers, indicating therein who of the separated employees could be
accepted on probationary basis, the petitioners filed their applications for
employment. They were hired on a probationary basis. They were later on
dismissed for allegedly committing acts prejudicial to the interest of the new
management which consisted of their "including unrepaired veneers in their
reported productions on output as well as untaped corestock or whole sheets
in their supposed taped veneers/corestock.”
Issue:
Whether the dismissed workers have remained regular employees
regardless of the change of management
Held:
No. Where such transfer of ownership is in good faith, the transferee is
under no legal duty to absorb the transferor employees as there is no law
compelling such absorption. The most that the transferee may do, for reasons
of public policy and social justice, is to give preference to the qualified
separated employees in the filling of vacancies in the facilities of the
purchaser.
The hiring of employees on a probationary basis is an exclusive

management prerogative. The employer has the right or privilege to choose
who will be hired and who will be denied employment. It is within the exercise
of this right that the employers may set or fix a probationary period within
which it may test and observe the employee's conduct before hiring him
permanently.
CALTEX REFINERY EMPLOYEES ASSOCIATION (CREA) vs.HON.

JOSE S. BRILLANTES
FACTS:
Anticipating the expiration of their CBA on July 31, 1995, petitioner
and private respondent negotiated the terms and conditions of employment to
be contained in a new CBA.To settle the unresolved issues, eight meetings
between the parties were conducted. Because the parties failed to reach any
significant progress in these meetings, petitioner declared a deadlock. On July
24, 1995, petitioner filed a notice of strike. 6 conciliation meetings conducted
by the NCMB failed, failed. Marathon meetings at the plant level, but this
remedy proved also unavailing. Secretary assumed jurisdiction and ordered
“Accordingly, any strike or lockout, whether actual or intended, is hereby
enjoined.”xxx But the members of petitioner defied them and continued their
mass action (despite repeated orders) Thereafter, the contending parties filed
their position papers pertaining to unresolved issues. Because of the strike,
private respondent terminated the employment of some officers of petitioner
union. The legality of these dismissals brought additional contentious issues.
Again, the parties tried to resolve their differences through conciliation.
Failing to come to any substantial agreement, the parties decided to refer the
problem to the secretary of labor and employment.
ISSUE:
Whether or not the Honorable Secretary of Labor and Employment
committed grave abuse of discretion in resolving the instant labor dispute.
HELD:
Union members have the right to demand wage increases through their
collective force; but it is equally cogent that they should also be able to justify
an appreciable increase in wages. We observe that private respondent’s
detailed allegations on productivity are unrebutted. It is noteworthy that
petitioner ignored this argument of private respondent and based its demand
for wage increase not on the ground that they were as productive as the Shell
employees. Thus, we cannot attribute grave abuse of discretion to public
respondent. The disagreement between petitioner and private respondent on
the union security clause should have been definitively resolved by public
respondent. The labor secretary should take cognizance of an issue which is
not merely incidental to but essentially involved in the labor dispute itself, or
which is otherwise submitted to him for resolution. The secretary of labor
assumed jurisdiction over this labor dispute in an industry indispensable to
national interest, precisely to settle once and for all the disputes over which
he has jurisdiction at his level. Although the union has every right to represent
its members in the negotiation regarding the terms and conditions of their
employment, it cannot negate their wishes on matters which are purely
personal and individual to them. When parties agree to submit unresolved
issues to the secretary of labor for his resolution, they should not expect their
positions to be adopted in toto. It is understood that they defer to his wisdom
and objectivity in insuring industrial peace. And unless they can clearly
demonstrate bias, arbitrariness, capriciousness or personal hostility on the part
of such public officer, the Court will not interfere or substitute the said
officer’s judgment with its own.
Chung Fu vs. CA
FACTS:
May 17, 1989: petitioner Chung Fu Industries and private respondents
Roblecor Philippines forged a construction agreement wherein Roblecor
committed to construct and finish on Dec. 31, 1989, ChungFu’s
industrial/factory complex in Tanawan, Cavite in consideration of P42M-It
was stipulated also that in the event of disputes, the parties will be subjected
to an arbitration resolution, wherein the arbitrator will be chosen by both
parties-Apart from the construction agreement, the parties also entered into
ancillary contracts for the construction of a dormitory and support facilities
with a contract price of 3, 875, 285.00 to be completed on or before October
31,1989 and the other dated Aug. 12,1989 for the installation of electrical,
water and hydrant systems at the plant site, priced at12.1M and requiring
completion thereof one month after civil works have been finished-However,
Roblecor failed to complete the work despite the extension allowed by Chung
Fu-Subsequently, Chung Fu had to take over the construction when it had
become evident that Roblecor was not in a position to fulfill the obligation-
Claiming an unsatisfied account of P10, 500, 000 and unpaid progress billings
of P 2, 370, 179.23,Roblecor filed a petition for Compulsory Arbitration with
prayer for TRO before respondent RTC ,pursuant to the arbitration clause in
the construction agreement-Chung Fu moved to dismiss the petition and
further prayed for the quashing of the restraining order-Subsequent
negotiations between the parties eventually led to the formulation of an
arbitration agreement which includes that the“ decision of the arbitrator shall
be final and unappealable, therefore ,there shall be no further judicial recourse
if either party disagree swith the whole or any part of the arbitrator’s award”-
RTC approved the arbitration agreement and Asuncion was appointed as the
sole arbitrator. Arbitrator ruled in favor of the contractor Roblecor-Chung Fu
moved to remand the case for further hearing and asked for a reconsideration
of the judgment award claiming that Asuncion committed 12 instances of
grave error by disregarding the provisions of the parties’ contract-RTC denied
Chung Fu’s Motion to Remand and approved Roblecor’s Motion for
Confirmation of Award. Chung Fu elevated the case to CA which denied the
petition-Hence, this petition to the Supreme Court.
ISSUES:
1.W/N the subject arbitration award is beyond the ambit of the court’s
power of judicial review.
HELD :
No, It’s stated explicitly under Art. 2044 of the Civil Code that the
finality of the arbitrator’s award is not absolute and without exceptions.
Where the conditions described in Arts. 2038, 2039 and 2040 applicable to
both compromises and arbitrations are obtaining, the arbitrators’ award maybe
annulled or rescinded. Additionally, Sections 24 and 25 of the Arbitration Law
provide grounds for vacating, Modifying or rescinding an arbitrator’s award.
DEL MONTE VS. SALDIVAR

Facts:
The Associated Labor Union (ALU) is the exclusive bargaining agent
of the plantation workers of petitoner. Respondent Timba, along with four
other employees were charged by ALU for disloyalty to the Union,
particularly for encouraging defections to rival Union, National Federation of
Labor (NFL). Timbal filed an answer before the Disloyalty Board, denying
the allegations in the complaint and the averments in Artajo's affidavit. She
noted that the allegations against her were purportedly committed nearly
2years earlier; and that Artajo's act was motivated by hate and revenge owing
to the filing of the aforementioned civil action. The Disloyalty Board
recommended the expulsion of Timbal from membership in ALU and
likewise dismissal from DMPI in accordance with the Union Security Clause
in the existing CBA between ALU and DMPI. The Labor Arbiter affirmed
that all five were illegally dismissed and ordered Del Monte to reinstate them
to their former position and to pay their full backwages and other
allowances..NLRC reversed the Labor Arbiter's decision. Court of Appeals
ruled that only Timbal was illegally dismissed and that DMPI failed to observe
procedural due process.
Issue:
Whether or not Timbal was illegally dismissed?
Held:
In the matter at bar, the Labor Arbiter who is the proximate trier of
facts, and the Court of Appeals oth appreciated that the testimony of Artajo
against Timbal could notbe given credence. This is due to the prior animosity
between the two engendered bythe pending civil complaint filed by Timbal's
husband against Artajo. Considering that the civil complaint was filed 6days
prior to the execution of Artajo's affidavit, it would be plainly injudicious to
presume that Artajo possessed an unbiased state of mind. Such circumtance
was considered by the Labor Arbiter and the Court of Appeals, as they
rendered favorably to Timbal. No credible disputation was offered by NLRC
to the claim that Artajo was biased against Timbal; hence, the Supreme Court
adjudge the findings of the Labor Arbiter and the CA as more cogent on that
points. The dismissal for cause of employees must be justified by substantial
evidence, as appreciated by an impartial trier of facts. The petition is denied
and the decision the Court if Appeals is affirmed
GENERAL MILLING CORPORATION VS. HON. COURT OF

APPEALS
Facts:
General Milling Corporation employed 190 workers. All the employees
were members of a union which is a duly certified bargaining agent. The GMC
and the union entered into a collective bargaining agreement which included
the issue of representation that is effective for a term of three years which will
expire on November 30, 1991. On November 29, 1991, a day before the
expiration of the CBA, the union sent GMC a proposed CBA, with a request
that a counter proposal be submitted within ten days. on October 1991, GMC
received collective and individual letters from the union members stating that
they have withdrawn from their union membership. On December 19, 1991,
the union disclaimed any massive disaffiliation of its union members. On
January 13, 1992, GMC dismissed an employee who is a union member. The
union protected the employee and requested GMC to submit to the grievance
procedure provided by the CBA, but GMC argued that there was no basis to
negotiate with a union which is no longer existing. The union then filed a case
with the Labor Arbiter but the latter ruled that there must first be a certification
election to determine if the union still enjoys the support of the workers.
Issue:
Whether or not GMC is guilty of unfair labor practice for violating its
duty to bargain collectively and/or for interfering with the right of its
employees to self-organization.
Held:
GMC is guilty of unfair labor practice when it refused to negotiate with
the union upon its request for the renegotiation of the economic terms of the
CBA on November 29, 1991. The union’s proposal was submitted within the
prescribed 3-year period from the date of effectivity of the CBA. It was
obvious that GMC had no valid reason to refuse to negotiate in good faith with
the union. The refusal to send counter proposal to the union and to bargain
anew on the economic terms of the CBA is tantamount to an unfair labor
practice under Article 248 of the Labor Code.
Under Article 252 of the Labor Code, both parties are required to
perform their mutual obligation to meet and convene promptly and
expeditiously in good faith for the purpose of negotiating an agreement. But
GMC failed in its duty under Article 252. What it did was to devise a flimsy
excuse, by questioning the existence of the union and the status of its
membership to prevent any negotiation. The Court of Appeals found that the
letters between February to June, 1993 by 13 union members signifying their
resignation from the union clearly indicated that GMC exerted pressure on the
employees. We agree with the Court of Appeals’ conclusion that the ill-timed
letters of resignation from the union members indicate that GMC interfered
with the right of its employee to self-organization.

FACTS:
Salvador Abtria, then President of respondent union, Association of
Employees and Faculty of Letran, initiated the renegotiation of its Collective
Bargaining Agreement with petitioner Colegio de San Juan de Letran for the
last two (2) years of the CBA's five (5) year lifetime from 1989-1994. On the
same year, the union elected a new set of officers wherein private respondent
Eleanor Ambas emerged as the newly elected President.
Ambas wanted to continue the renegotiation of the CBA but petitioner,

through Fr. Edwin Lao, claimed that the CBA was already prepared for
signing by the parties. The parties submitted the disputed CBA to a
referendum by the union members, who eventually rejected the said CBA.
Petitioner accused the union officers of bargaining in bad faith before the
National Labor Relations Commission (NLRC).
The appellate court dismissed the petition and affirmed the findings of
the Secretary of Labor and Employment.
ISSUES:
Whether or not the termination of the union president amounts to an
interference of the employees' right to self-organization.
HELD:
In order to allow the employer to validly suspend the bargaining process
there must be a valid petition for certification election raising a legitimate
representation issue. Hence, the mere filing of a petition for certification
election does not ipso facto justify the suspension of negotiation by the
employer. The petition must first comply with the provisions of the Labor
Code and its Implementing Rules. Foremost is that a petition for certification
election must be filed during the sixty-day freedom period. In the case at bar,
the lifetime of the previous CBA was from 1989-1994.
The right to self-organization of employees must not be interfered with
by the employer on the pretext of exercising management prerogative of
disciplining its employees. In this case, the totality of conduct of the employer
shows an evident attempt to restrain the employees from fully exercising their
rights under the law. This cannot be done under the Labor Code.
THE INSULAR LIFE ASSURANCE CO., LTD., EMPLOYEES

ASSOCIATION vs. THE INSULAR LIFE ASSURANCE CO., LTD.,
Facts:
The Insular Life Assurance Co., Ltd., Employees Association-NATU,
FGU Insurance Group Workers & Employees Association-NATU, and
Insular Life Building Employees Association-NATU (hereinafter referred to
as the Unions), while still members of the Federation of Free Workers (FFW),
entered into separate CBAs with the Insular Life Assurance Co., Ltd. and the
FGU Insurance Group (hereinafter referred to as the Companies). Two of the
lawyers of the Unions then were Felipe Enaje and Ramon Garcia; the latter
was formerly the secretary-treasurer of the FFW and acting president of the
Insular Life/FGU unions and the Insular Life Building Employees
Association. Garcia, as such acting president, in a circular issued in his name
and signed by him, tried to dissuade the members of the Unions from
disaffiliating with the FFW and joining the National Association of Trade
Unions (NATU), to no avail. Enaje and Garcia soon left the FFW and secured
employment with the Anti-Dummy Board of the Department of Justice.
Thereafter, the Companies hired Garcia in the latter part of 1956 as assistant
corporate secretary and legal assistant in their Legal Department. Enaje was
hired as personnel manager of the Companies, and was likewise made
chairman of the negotiating panel for the Companies in the collective
bargaining with the Unions. Unions jointly submitted proposals to the
Companies; negotiations were conducted on the Union’s proposals, but these
were snagged by a deadlock on the issue of union shop, as a result of which
the Unions filed on January 27, 1958 a notice of strike for “deadlock on
collective bargaining.” The issue was dropped subsequently (in short,
nagkasundo). But, the parties negotiated on the labor demands but with no
satisfactory result due to a stalemate on the matter of salary increases.
Meanwhile, 87 unionists were reclassified as supervisors without increase in
salary nor in responsibility while negotiations were going on in the
Department of Labor after the notice to strike was served on the Companies.
These employees resigned from the Unions. On May 21, 1958 the company
sent to each of the strikers a letter alleging that some non-strikers were injured
and with the use of photographs as evidence, the Companies then filed
criminal charges against the strikers with the City Fiscal’s Office of Manila.
ISSUE:
Whether or not respondent company is guilty of ULP.
HELD:
The act of an employer in notifying absent employees individually
during a strike following unproductive efforts at collective bargaining that the
plant would be operated the next day and that their jobs were open for them
should they want to come in has been held to be an unfair labor practice, as
an active interference with the right of collective bargaining through dealing
with the employees individually instead of through their collective bargaining
representatives. Although the union is on strike, the employer is still under
obligation to bargain with the union as the employees’ bargaining
representative All the above-detailed activities are unfair labor practices
because they tend to undermine the concerted activity of the employees, an
activity to which they are entitled free from the employer’s molestation. The
individual cases of dismissed officers and members of the striking unions do
not indicate sufficient basis for dismissal.

NUBE) VS STANDARD CHARTERED BANK
FACTS:

Department and one Human Resources (HR) staff.
SCBEU-NUBE also averred that employees assigned in an acting

capacity for at least a week should be given salary raise.

ISSUE:
HELD:
No. Whether or not the employees sought to be excluded from the

K-mart vs. NLRB

Facts:
Kmart owns and operates Super Kmart Centers throughout the United
States. Much larger than a traditional Kmart store, Super Kmart Centers are
vast, one-stop shopping centers open twenty-four hours per day, seven days
per week. K-mart owns and operates two such stores in Bradley and
Broadview, Illinois. The meat department unit at the Broadview store employs
fourteen individuals, including four meat cutters and a total of eight meat
wrappers and PSAs. The employees classified as meat cutters receive wages
of approximately $17.50 per hour, more than three times as high as other
employees in the Bradley and Broadview stores. Meat wrappers operate
wrapping machines and package and price the meat after it has been cut by
the meat cutters. The meat wrappers earn wages slightly higher than the $5.50
per hour starting wage paid to meat department PSAs. On October 10, 1996,
Local 546 of the United Food and Commercial Workers Union ("Local 546")
filed a petition with the NLRB's regional office, seeking certification as the
exclusive bargaining representative of the meat department's employees at the
Broadview store, while on December 16, 1996, Local 1540 of the United Food
and Commercial Workers Union ("Local 1540") filed a petition with the
NLRB's regional office seeking certification as the exclusive bargaining
representative of all of the meat department employees at the Bradley store.
The regional director for the two geographic regions ruled that the employee
units petitioned for were appropriate. The director ruled specifically that those
employees assigned to the two respective meat departments shared a
"community of interests" separate from other employees at the two Super
Kmart Centers and that there was minimal interchange between meat
department employees and non-meat department employees. Furthermore, the
director found that the meat department employees utilized special skills, had
separate daily supervision, and worked in physically separate areas. The
director ordered that representation elections be conducted among and limited
to the meat department employees for both stores to determine whether they
wished to be represented by the locals. Following successful votes for
unionization in the respective meat departments, the NLRB certified Local
1540 as representative of the meat department employees at the Bradley store
on May 22, 1997, and Local 546 as representative of the meat department
employees at the Broad-view store on August 4, 1997. After Kmart refused to
recognize Local 1540 and Local 546 in the respective stores, each filed
charges with the NLRB alleging that the refusals constituted unfair labor
practices under the National Labor Relations Act.. Furthermore, Kmart failed
to argue any special circumstances that required the NLRB to reexamine its
earlier unit determinations. Accordingly, the NLRB found that Kmart violated
29 U.S.C. 158(a)(5) and (1) by refusing to bargain with the respective locals.
The NLRB ordered the company to bargain with the locals upon request.
Issue:
Whether or Not Mart is liable for unfair labor practise.
Held:
The NLRB reasonably determined that units consisting of meat
department employees in two Kmart stores constituted appropriate bargaining
units and therefore properly found that Kmart violated sections 8(a)(5) and (1)
of the National Labor Relations Act by refusing to bargain with the duly
certified collective bargaining representatives of those employees.
PHILCOM EMPLOYEES UNION VS PHILIPPINE GLOBAL

COMMUNICATIONS and PHILCOM CORPORATION
Facts:
The Collective Bargaining Agreement (CBA) between petitioner
Philcom Employees Union and the respondent Philcom Corporation
expired.The parties started negotiations for the renewal of their CBA in July
1997. While negotiations were ongoing, PEU filed a Notice of Strike with the
National Conciliation and Mediation Board (NCMB) National Capital Region
on the ground of perceived unfair labor practice committed by the company.
The company, then, suspended the ongoing CBA negotiation on the ground
of bargaining deadlock.The union went for another strike. At a conciliation
conference held at the NCMB-NCR office, the parties agreed to consolidate
the two (2)Notices of Strike filed by the union and to maintain the status quo
during the pendency of the proceedings While the union and the company
officers and representatives were meeting, the remaining union officers and
members staged a strike at the company premises. The company immediately
filed a petition for the Secretary of Labor and Employment to assume
jurisdiction over the labor dispute. Acting Labor Secretary Trajano: enjoining
any strike or lockout, whether threatened or actual,directing the parties to
cease and desist from committing any act that may exacerbate the situation.
The Union's Manifestation/Motion to Strike Out Portions of and Attachments
in Philcom's Position Paper is hereby denied for lack of merit.The Union's
charges of unfair labor practice against the Company are hereby dismissed.
CA: Violations of CBAs, except those gross in character, are mere grievances
resolvable through the appropriate grievance machinery or voluntary
arbitration as provided in the CBAs
Issue:1.) Was there an illegal strike?

2.) Was there unfair labor practice?
Held:
Unfair labor practice refers to acts that violate the workers' right to
organize. The prohibited acts are related to the workers' right to self-
organization and to the observance of a CBA. Without that element, the
acts,no matter how unfair, are not unfair labor practices.
The strike and the strike and strike activities undertaken by PEU were
patently illegal. PEU should have immediately resorted to the grievance
machinery provided for in the CBA. In disregarding this procedure, the union
leaders who knowingly participated in the strike have acted unreasonably. The
law cannot interpose its hand to protect them from the consequences of their
illegal acts.
A strike declared on the basis of grievances which have not been

submitted to the grievance committee as stipulated in the CBA of the parties
is premature and illegal.
American Pres Lines vs. Clave
Facts:
The Maritime Security Union through private respondent filed a
complaint against petitioner for unfair labor practice under RA 875. They
contended that the petitioner had refused to negotiate an agreement with them
and discriminated them regarding their tenure of employment by dismissing
them. Petitioner entered into a contract with the Maritime Security Agency
for the latter to guard the petitioner’s vessel. The term of the contract is one
year and may be terminated by either party upon 30 days notice. The
relationship between petitioner and Maritime Security Agency is that it was
the latter who hired the guards and the guards were not known to petitioner.
A lump sum would be paid by the petitioner to the agency wherein the latter
pays the compensation to the guards.
However, petitioner terminated the contract on its

termination period with prior notice. After its termination, petitione
r executed a contact with another agency.Respondents protested on this.
Issue:
Whether or not an employer-employee relationship exists between petitioner and
watchmen thus committed unfair labor practice.
Held:
No. It is the agency that hires the work of its watchmen. Hence, a
watchman cannot perform any security service unless the agency first accepts
him. It is also the agency that pays the wages to a watchman. Neither does the
petitioner have any power of dismissal, because such power lies in the hands
of the agency. Since the petitioner has to deal with the agency, petitioner
does not exercise any power over watchmen’s conduct. Thus, it is the
agency that is answerable to the petitioner for the conduct of its guards. It
follows that petitioner cannot be guilty of unfair labor practice because under
RA 875 Sec. 13, an unfair labor practice may be committed only within the
context of an employer-employee relationship.
HSBC EMPLOYEES UNION vs. NATIONAL LABOR RELATIONS

COMMISSION and HSBC
Facts:
The case at bar arose from the issuance of a non-executive Job
Evaluation Program (JEP) lowering the starting salaries of future employees,
resulting from the changes made in the job grades and structures, which was
unilaterally implemented by the Bank retroactive to January 1, 1993. The
program in question was announced by the Bank on January 18, 1993. The
Bank stated that the Union was actually challenging merely that portion of the
JEP providing for a lower rate of salaries for future employees. Contrary to
the Union’s allegations in its motion to dismiss that the JEP had resulted in
diminution of existing rights, privileges and benefits, the program has actually
granted salary increases to, and in fact is already being availed of by, the rank
and file staff. The Union’s objections are premised on the erroneous belief
that the salary rates for future employees are a matter which must be subject
of collective bargaining negotiation. The Bank believes that the
implementation of the JEP and the resultant lowering of the starting salaries
of future employees, as long as there is no diminution of existing benefits and
privileges being accorded to existing rank and file staff, is entirely a
management prerogative.
Issue:
W/N the Union’s objections to the implementation of the JEP are valid.
Held:
In the case at bar, private respondent union has miserably failed to
convince this Court that the petitioner acted in bad faith in implementing the
Job Evaluation Program. There is no showing that the JE Program was
intended to circumvent the law and deprive the members of respondent union
of the benefits they used to receive. It is a well-settled rule that labor laws do
not authorize interference with the employer’s judgment in the conduct of his
business. The Labor Code and its implementing rules do not vest in the labor
arbiters nor in the different divisions of the NLRC nor in the courts managerial
authority. The hiring, firing, transfer, demotion, and promotion of employees
has been traditionally identified as a management prerogative subject to
limitations found in the law, a collective bargaining agreement, or in general
principles of fair play and justice. This is a function associated with the
employer’s inherent right to control and manage effectively its enterprise.
Even as the law is solicitous of the welfare of employees, it must also protect
the right of an employer to exercise what are clearly management
prerogatives. The free will of management to conduct its own business affairs
to achieve its purpose cannot be denied. Accordingly, this Court, in a number
of cases, has recognized and affirmed the prerogative of management to
implement a job evaluation program or reorganization for as long as it is not
contrary to law, morals or public policy.

NUBE) VS STANDARD CHARTERED BANK
FACTS:

Department and one Human Resources (HR) staff.
SCBEU-NUBE also averred that employees assigned in an acting

capacity for at least a week should be given salary raise.

ISSUE:
HELD:
No. Whether or not the employees sought to be excluded from the

Scoty's Dept. Store vs. Mecaller
Facts:
Nena Mecaller was a salesgirlin the Scoty's Department Store, which
was own by Yu Ki Lam, RIchard Yang, Yu Si Kiao and Helen Yang. Micaller
filed charged of unfair labor against her above employers as she was dismissed
because of her membership in the National Labor Union. the employers
denied the charge, saying that they dismissed Micaller because of her
misconduct and serious disrespect the management and her co-employees.
Prior to November 1953, Nena Micaller was earning P4.80 a day. After every
New Year, she was given from P180 to P200 as bonus whereas the other
employees were only given P60. For three consecutive years, she was the best
sellers, the most cooperative and the most honest employee. One wee before
October 12, 1953, she organized the union among the employees of the store,
which was later affiliated with the National Labor Union. The Court of
Industrial Relations (CIR) found petitioners,guilty of unfair labor practice and
ordered them to pay a fine of P100.
ISSUE:
W/N the Court of Industrial Relations has Jurisdiction to impose the
penalties prescribed in section 25 of Republic Act No. 875.
HELD:
Petitioners contend that Nena Micaller was dismissed because of her
membership in the National Labor Union and her union activities; 2)that
petitioners committed unfair labor practice; and 3)that petitioners can be
legally punished by a fine of P100. The Industrial Court has made a careful
analysis of the evidence and has found that petitioners have really subjective
complainant and her co-employees to a series of questioning regarding their
membership in the union activities or their union activities which in
comtemplation of law are deemed acts constituting unfair labor practice.
Whether CFI is justified in imposing a fine not only upon Yu Ki Lam, who
was the manager of the store, but also upon Richard Yang , Yu Si Kiao and
Helen Yang, who were mere owners. Petitioners contend that section 25 of
Republic Act No. 875 being penal in character should be strictly construed in
the favor of the accused and in that sense their guilt can only be established
by clear and positive evidence and not merely presumptions or inferences as
was done by the Industrial Court. The evidence as regards unfair labor
practice with reference to the three above-named petitioners is not clear
enough to serve as basis of their conviction for unfair labor practice and the
fine imposed upon them is unjustified.
Phil. Steam Navigational Co. vs. Phil. Marine Officers Guild
Facts:
PMOG accused PHILSTEAM that it has conducted a series of
interrogation of its employees and interfered with, restrained and coerced the
employees in the exercise of their rights to self-organization. PMOG's
subjection to vilification is likewise borne out by substantial evidence.
Santiago Beluso, PHILSTEAM's purchasing agent, told Luis Feliciano, on
August 6, 1954, that PMOG was a "money-asking union." PMOG conducted
a strike based on the aforementioned unfair labor practise. On the part of
PHILSTEAM, it averred that PMOG is a minority union, hence, it does not
have authority to bargain with the management. Also, PMOG 's alleged illegal
strike was conducted to undermine the existing agreement between
PHILSTEAM and CSA.
Issue:
Whether or not PMOG's strike was illegal?
Held:
The rule in this jurisdiction is that subjection by the company of its
employees to series of questionings regarding their membership in the union
or their union activities in such a way as to hamper their exercise of free choice
on their part, constitutes unfair labor practise. PHILSTEAM's aforestated
interrogation squarely falls under this rule. The respondent court has found
that PHILSTEAM's interrogation of its employees had in fact interfered with,
restrained and coerced the employees in the exercise of their rights to self-
organization. First of all, the statement that PMOG is a minority union is not
accurate. Respondent court precisely found that there has been no proof as to
which union, PMOG, CSA or any other, represented the majority of
PHILSTEAM employees. For lack of showing that CSA represented majority
it declared the PHILSTEAM-CSA's collective bargaining agreement null and
void. It stated that the parties to the dispute were welcomed to file a petition
for certification election to decide this point. Secondly, PMOG's strike was a
retaliation to PHILSTEAM's unfair labor practise rather than, as
PHILSTEAM would picture it, an attempt to undermine the PHILSTEAM-
CSA agreement. For said agreement was signed only on August 24, 1954 but
PMOG filed its notice of strike as early as July 17, 1954. PHILSTEAM's
unfair labor practise, consisting in its interference with the employees’ rights
to self-organization started on June 29, 1954. It was because of the said
unlawful act of the employer that the union struck. The notice of strike, in fact
mentioned company ULP as reason for the intended strike. Based on the
foregoing, it follows that PMOG's strike was for a lawful purpose and,
therefore, JUSTIFIED.
THE INSULAR LIFE ASSURANCE CO., LTD., EMPLOYEES

ASSOCIATION vs. THE INSULAR LIFE ASSURANCE CO., LTD
Facts:
The Insular Life Assurance Co., Ltd., Employees Association-NATU,
FGU Insurance Group Workers & Employees Association-NATU, and
Insular Life Building Employees Association-NATU (hereinafter referred to
as the Unions), while still members of the Federation of Free Workers (FFW),
entered into separate CBAs with the Insular Life Assurance Co., Ltd. and the
FGU Insurance Group (hereinafter referred to as the Companies). Two of the
lawyers of the Unions then were Felipe Enaje and Ramon Garcia; the latter
was formerly the secretary-treasurer of the FFW and acting president of the
Insular Life/FGU unions and the Insular Life Building Employees
Association. Garcia, as such acting president, in a circular issued in his name
and signed by him, tried to dissuade the members of the Unions from
disaffiliating with the FFW and joining the National Association of Trade
Unions (NATU), to no avail. Enaje and Garcia soon left the FFW and secured
employment with the Anti-Dummy Board of the Department of Justice.
Thereafter, the Companies hired Garcia in the latter part of 1956 as assistant
corporate secretary and legal assistant in their Legal Department. Enaje was
hired as personnel manager of the Companies, and was likewise made
chairman of the negotiating panel for the Companies in the collective
bargaining with the Unions. Unions jointly submitted proposals to the
Companies; negotiations were conducted on the Union’s proposals, but these
were snagged by a deadlock on the issue of union shop, as a result of which
the Unions filed on January 27, 1958 a notice of strike for “deadlock on
collective bargaining.” The issue was dropped subsequently (in short,
nagkasundo). But, the parties negotiated on the labor demands but with no
satisfactory result due to a stalemate on the matter of salary increases.
Meanwhile, 87 unionists were reclassified as supervisors without increase in
salary nor in responsibility while negotiations were going on in the
Department of Labor after the notice to strike was served on the Companies.
These employees resigned from the Unions. On May 21, 1958 the company
sent to each of the strikers a letter alleging that some non-strikers were injured
and with the use of photographs as evidence, the Companies then filed
criminal charges against the strikers with the City Fiscal’s Office of Manila.
ISSUE:
Whether or not respondent company is guilty of ULP.
HELD:
The act of an employer in notifying absent employees individually
during a strike following unproductive efforts at collective bargaining that the
plant would be operated the next day and that their jobs were open for them
should they want to come in has been held to be an unfair labor practice, as
an active interference with the right of collective bargaining through dealing
with the employees individually instead of through their collective bargaining
representatives. Although the union is on strike, the employer is still under
obligation to bargain with the union as the employees’ bargaining
representative All the above-detailed activities are unfair labor practices
because they tend to undermine the concerted activity of the employees, an
activity to which they are entitled free from the employer’s molestation. The
individual cases of dismissed officers and members of the striking unions do
not indicate sufficient basis for dismissal.
Philippine Blooming Mills Employees Organization vs. PBM
Facts:
Philippine Blooming Employees Organization (PBMEO) decided to
stage a mass demonstration in front of Malacañang to express their grievances
against the alleged abuses of the Pasig Police.
After learning about the planned mass demonstration, Philippine

Blooming Mills Inc., called for a meeting with the leaders of the PBMEO.
During the meeting, the planned demonstration was confirmed by the union.
But it was stressed out that the demonstration was not a strike against the
company but was in fact an exercise of the laborers inalienable constitutional
right to freedom of expression, freedom of speech and freedom for petition
for redress of grievances.
The company asked them to cancel the demonstration for it would

interrupt the normal course of their business which may result in the loss of
revenue. This was backed up with the threat of the possibility that the workers
would lose their jobs if they pushed through with the rally.
A second meeting took place where the company reiterated their appeal
that while the workers may be allowed to participate, those from the 1st and
regular shifts should not absent themselves to participate , otherwise, they
would be dismissed. Since it was too late to cancel the plan, the rally took
place and the officers of the PBMEO were eventually dismissed for a violation
of the ‘No Strike and No Lockout’ clause of their Collective Bargaining
Agreement.
The lower court decided in favor of the company and the officers of the
PBMEO were found guilty of bargaining in bad faith. Their motion for
reconsideration was subsequently denied by the Court of Industrial Relations
for being filed two days late.
Issue:
Whether or not the workers who joined the strike violated the CBA.
Held:
No. While the Bill of Rights also protects property rights, the primacy
of human rights over property rights is recognized. Because these freedoms
are "delicate and vulnerable, as well as supremely precious in our society" and
the "threat of sanctions may deter their exercise almost as potently as the
actual application of sanctions," they "need breathing space to survive,"
permitting government regulation only "with narrow specificity." Property
and property rights can be lost thru prescription; but human rights are
imprescriptible. In the hierarchy of civil liberties, the rights of free expression
and of assembly occupy a preferred position as they are essential to the
preservation and vitality of our civil and political institutions; and such
priority "gives these liberties the sanctity and the sanction not permitting
dubious intrusions."
The freedoms of speech and of the press as well as of peaceful assembly

and of petition for redress of grievances are absolute when directed against
public officials or "when exercised in relation to our right to choose the men
and women by whom we shall be governed.”
BATANGAS LAGUNA VS. NLRC(BLT BUS CO V NLRC
FACTS:
Tinig at Lakas ng Manggagawa sa BLTB Co. NAFLU, filed a Notice
of Strike against the BLTB Co. on the grounds of unfair labor practice and
violation of the CBA. BLTB Co. asked the Sec. of Labor to assume
jurisdiction or to certify it to the NLRC. The Acting Sec of Labor later
certified it to the NLRC. A copy of the certification order was served upon
NAFLU. The union secretary, however, refused to receive it. The officers and
members of TL M-BLTBCo-NAFLU went on strike. The NLRC issued a
resolution ordering the employees to stop the strike. BLTBCo caused the
publication of the resolution and called on all striking workers to return to
work. Of the some 1,730 BLTBCo employees who went on strike, only 1,116
reported back for work. Seventeen others were later re-admitted.
Subsequently, about 614 employees, including those who were allegedly
dismissed for causes other than the strike, filed individual complaints for
illegal dismissal. Their common ground was that they were refused admission
when they reported back for work. The NLRC issued a resolution ordering the
reinstatement of the union members.
ISSUE:
Whether or not the union members who participated in the illegal strike
should be reinstated?
HELD:
First, there was inadequate service of the certification order on the
union as of the date the strike was declared and there was no showing that the
striking members had been apprised of such order by the NAFLU. Second, by
virtue of the priniciple of vicarious liability, only the union officers deserve
not to be reinstated. The leaders of the union are the moving force in the
declaration of the strike and the Rank-in-file employees merely followed.
Likewise, viewed in the light of Article 264, paragraph (e), those who
participated in the commission of illegal acts who stood charged criminally
thereof in court must be penalized.
The contention of the petitioner that the private respondents abandoned

their position is also not acceptable. An employee who forthwith takes steps
to protest his lay-off cannot by any logic be said to have abandoned his work.
The loss of employment status of striking union members is limited to those
"who knowingly participates in the commission of illegal acts." Evidence
must be presented to substantiate the commission thereof and not merely an
unsubstantiated allegation. The right to strike is one of the rights recognized
and guaranteed by the Constitution as an instrument of labor for its protection
against exploitation by management. By virtue of this right, the workers are
able to press their demands for better terms of employment with more energy
and persuasiveness, poising the threat to strike as their reaction to the
employer's intransigence. The strike is indeed a powerful weapon of the
working class. But precisely because of this, it must be handled carefully, like
a sensitive explosive, lest it blow up in the workers' own hands. Thus, it must
be declared only after the most thoughtful consultation among them,
conducted in the only way allowed, that is, peacefully, and in every case
conformably to reasonable regulation. Any violation of the legal requirements
and strictures, such as a defiance of a return-to-work order in industries
affected with public interest, will render the strike illegal, to the detriment of
the very workers it is supposed to protect.
SAMAHANG MANGGAGAWA SA SULPICIO LINES, INC.–NAFLU

vs. SULPICIO LINES, INC.
Facts:
On February 5, 1991, Sulpicio Lines, Inc. (herein respondent) and the
Samahang Manggagawa sa Sulpicio Lines Inc. – NAFLU (herein petitioner)
executed a collective bargaining agreement (CBA) with a term of five (5)
years (from October 17, 1990 to October 16, 1995). After three (3) years or
on December 15, 1993, petitioner union and respondent company started their
negotiation on the CBA’s economic provisions.4 But this negotiation
remained at stalemate. On March 1, 1994, petitioner filed with the National
Conciliation and Mediation Board (NCMB), National Capital Region, a notice
of strike due to collective bargaining deadlock, docketed as NCMB-NCR-NS-
03-118-94. For its part, respondent, on March 21, 1994, filed with the Office
of the Secretary, Department of Labor and Employment a petition praying that
the Labor Secretary assume jurisdiction over the controversy. On March 23,
1994, former Labor Secretary Nieves R. Confesor issued an Order assuming
jurisdiction over the labor dispute. Provoked by respondent’s alleged unfair
labor practice/s, petitioner union immediately conducted a strike vote. Thus,
on May 20, 1994, about 9:30 o’clock in the morning, 167 rank-and-file
employees, officers and members of petitioner, did not report for work and
instead gathered in front of Pier 12, North Harbor at Manila. As a remedial
measure, former Labor Secretary Confesor issued an Order dated May 20,
1994 directing the striking employees to return to work; and certifying the
labor dispute to the National Labor Relations Commission (NLRC) for
compulsory arbitration. Meanwhile, respondent company filed with the
NLRC a complaint for "illegal strike/clearance for termination.” On
September 29, 1995, the NLRC issued a Resolution declaring the strike of
petitioner’s officers and members illegal, with notice to respondent of the
option to terminate their (petitioner’s officers) employment. The union’s
complaint against the company is hereby DISMISSED for lack of merit. Court
of appeals affirmed the decision of NLRC. Hence, this appeal.
Issue:
Withier or not the strike staged by petitioner’s officers and members is
illegal?
Held:
There is no showing that the petitioner union observed the 7-day strike
ban; and that the results of the strike vote were submitted by petitioners to the
Department of Labor and Employment at least seven (7) days before the
strike. We thus hold that for failing to comply with the mandatory
requirements of Article 263 (c) and (f) of the Labor Code, the strike mounted
by petitioner union on May 20, 1994 is illegal. Petition is DENIED. The
Decision and Resolution of the Court of Appeals was AFFIRMED.
PHIL CAN CO. VS. CIR
FACTS:
Philippine Can Company is engaged in the manufacture of tincans for
packing biscuits, candies, etc., and for making pails for carrying water and
basins for washing purposes. On March 14,1949, laborers belonging to
Liberal Labor Union working in Phil
Can’s factory staged a strike and established a picket line around the
company's compound. Strikers and picketers prevented other laborers from
continuing to work in the factory so that the company officials were compelled
to appeal to the police to restore order and protect the loyal workers and
officials. The company posted notices at the gate of the company compound
notifying the strikers that those who did not return to work in the afternoon
will be considered dismissed; in fact those who did not return to work were
declared dismissed and dropped from the payroll. Liberal Labor Union filed a
petition with the CIR alleging that Phil Can had reduced the wages of seven
laborers, and that after the negotiations had failed, the strike was declared.
The Union asked the CIR to order Phil Can to restore the former rate of wages
and to refund all deductions made in their salaries. Phil Can alleged that the
strike declared by the union was illegal, the same having been declared
without due and proper notice to the management, no verbal nor written
demands having been presented beforehand for its study, consideration and/or
actuation. The CIR issued an order directing the laborers to immediately
return to work and Phil Can to admit them under the same conditions which
prevailed before the conflict arose. The reason in support of the order was to
maintain the parties in status quo before the strike, and because the conflict
could not be promptly decided.
ISSUE:
W/N the CIR erred in ordering Phil Can to admit the laborers back to
work despite the issue of the strike’s illegality being raised.
HELD:
A strike is a coercive measure resorted to by laborers to enforce their
demands. Pending determination of the conflict, especially where public
interests so require or when the court cannot promptly decide the case, the
strikers are ordered back to work. The facts in the present case are far
different. Public interests are hardly affected or involved in the present strike.
The business of Phil Can is not such that the public is keenly interested in its
continuance. Many similar companies have sprung up since 1947, resulting in
intense and even ruinous competition, thus explaining the downward trend in
the business and its desire to lay off laborers. After the strike was staged the
company did not employ other laborers to take the places of the strikers. It
claims that it no longer needs the services of the strikers. It becomes
consequently apparent that the need for ordering the strikers back to work in
ordinary cases does not obtain or exist in the present case. Should it be found
after due hearing that the strike was legal and the laborers were improperly
discharged, the employer company can be ordered to pay their back wages.
ELIZALDE ROPE VS. SSS
FACTS:
The laborers of the Elizalde Rope Factory went on strike. During the
period of time the strike lasted, the factory did not pay to the Social Security
Commission any premium for Tupas, a laborer and one of the strikers. After
the strike, the factory resumed to pay the premium until Tupas’ death. Social
Security sent bill No. 138 representing the unpaid premium for Tupas. Factory
claims that it should be for the account of Tupas since he was considered
unemployed by the company at the time of the strike. Social Security declared
that the strike was not unlawful and reiterated the company’s obligation to pay
premiums. Factory requested for reconsideration, which was denied thru
Resolution No. 41.
ISSUE:
W/N social security premium corresponding to a period when a
covered worker is on strike should be paid by the employer.
HELD:
Ratio Although during a strike the worker renders no work or service
and receives no compensation, yet his relationship as an employee with his
employer is not severed or dissolved. Strike is the workers' means of
expressing their grievances to employers and enforcing compliance with their
demands made upon them. And when laborers go on strike, it cannot be said
that they intend to cut off or terminate their relationship with their employer.
On the contrary, a strike may improve the employer-employee relationship
bringing about better working conditions and more efficient services. Sec 18
of RA 1161 as amended by RA 1792 provides that: Beginning as of the last
day of the calendar month immediately preceding the month when an
employee's compulsory coverage age takes effect and every month thereafter
during his employment, there shall be deducted and withheld from the
monthly compensation of such covered employee a contribution equal to two
and a half percentum of his monthly compensation. Beginning as of the last
day of the month immediately preceding the month when an employee's
compulsory coverage takes effect and every month thereafter during his
employment, his employer shall pay, with respect to such covered employee
in his employ, a monthly contribution equal to three and a half per centum of
the monthly compensation of said covered employee. The aforementioned
legal provisions do not require that the employer's 3- 1/2% and employee's 2-
1/2% contributions be based on the latter’s monthly compensation actually
earned or received by the employee covered by the Social Security System.
They only provide that after an employee is compulsorily covered by the
System he and his employer will contribute to pay the premium every month
during his employment. The Resolution appealed from was AFFIRMED.
CONSOLIDATED LABOR ASSOCIATION OF THE PHILS. VS.

MARSMAN AND COMPANY, INC.
Facts:
The Union was certified as the bargaining representative of the
Company's employees and commenced negotiations with it for a CBA.
Despite several meetings, the parties failed to reach an agreement, eventually
leading to the filing of a notice of strie by the Union. A strike was eventually
declared by the union when conciliation meetings at the DOLE failed to
produce a settlement. The strike was attended by acts of violence on the part
of certain strikers. Thereafter, upon the intercession of the Secretary of Labor,
the strikers agreed to return to work on the promise that the company would
discuss their demands with them. While the company admitted some of the
strikers , it refused readmission to others unless they ceased to be active union
members. As a result, the strike and picketing were resumed.
Issues:
W/N the company is liable for backwages?
Held:
The Supreme Court held that CIR had the discretion whether or not to
award backwages in an unfair labor practice strike.Even after the court has
made a finding of unfair labor practice, it has the discretion to determine
whether or not to grant backpay. Such discretion was not abused when it
denied bacwages to complainants, considering the climate of violence which
attended the strike and the picket that the complainants conducted. While the
complainants who are ordered reinstated did not actively take part in the acts
of violence, their minatory attitude towards the company may be gathered
from the fact that from the very first day of strike, policemen had to patrol the
strike zone in order to preserve peace.
Ilaw at Buklod ng Manggagawa v. NLRC
Facts:
There was a wage order that caused a wage distortion within the
company. Union then proposed to the mgt. that the wage distortion be
corrected by implementing a 25php wage increase, which it later lowered to
15php. The Company, however, only effected a 7php wage increase. The
union considered the management’s move as the company ignoring their
demands.
As a result, the union decided to work only for 8 hours per day, against
the company practice for 5 years of having the workers work 10 to 14-hour
work shifts.
This caused the company, SMC losses, due to diminished productivity,

prompting it to file a complaint with the NLRC seeking the declaration of the
said union’s activity (strike/slowdown) as illegal.
Issue:
Whether or not said slowdown/strike is illegal
Held:
It is illegal, on several grounds.
The Court concedes the workers’ right to self organization and to

concerted activities in exercise of that right. The Court also pointed out that
common examples are strike/temporary stoppage of work, and picketing.
However, the Court also points out that such right is not absolute and
may be limited by law. In this case, the Court pointed out that:
The legality of these activities is usually dependent on the legality of

the purposes sought to be attained and the means employedtherefor. These
joint or coordinated activities may be forbidden or restricted by law or
contract.
In the particular instance of "distortions of the wage structure within an
establishment" resulting from "the application of any prescribed wage
increase by virtue of a law or wage order," Section 3 of Republic Act No.
6727 prescribes a specific, detailed and comprehensive procedure for the
correction thereof, thereby implicitly excluding strikes or lockouts or other
concerted activities as modes of settlement of the issue.
RIZAL CEMENT WORKERS UNION VS. CIR
FACTS:
The Rizal Cement Workers Union, affiliated with the Federation of
Free Workers, heretofore referred to as the Union, is a legitimate labor
organization. The twenty-one complainant workers are members of the Union
and work at the Bodega Tanque, Paco, Manila. Rizal Cement Co., Inc. is a
corporation likewise organized under the laws of the Philippines and is
engaged principally in the manufacture of cement. It operates a plant in
Binangonan, Rizal, where it manufactures cement. In the morning of May 28,
1956 when the workers arrived for work at 7:00 a.m., the 21 complaining
workers who are members of the Union were not allowed to enter the gate and
allowed only those who are not members of said Union. Upon refusal of
Candido de Leon to allow the complaining workers to work on that day, the
Union, through Ramon L. Kabigting, Vice- President of the FFW, sent a letter
addressed to the Manager, Bodega Tanque, Rizal Cement Co., Inc On May
30, 1956, the complaining workers formed a picket line in front of the
Madrigal Building on the Escolta, Manila, where the Offices of the respondent
companies are located. The picket lasted up to April, 1957. After the
complaining workers were not allowed to work on May 28,1956, the
respondent Rizal Cement Co., Inc. hired substitutes in in Bodega Tanque. The
court held that, under the circumstances, the strike was resorted to as a
defensive weapon dictated by economic necessity and, consequently, did not
constitute an unfair labor practice. The court directed the Company to reinstate
the 21 complainants with back wages only from May 28, 1961. This decision
was affirmed by the court en banc by resolution of January 27, 1962. Hence,
the filing of the instant petition.
ISSUE:
W/N the Company's refusal to admit the 21 complainants to work in the
warehouse, simply because they belong to the same Union that staged the
strike in the factory, constituted a violation of Section (a) (4) of the Industrial
Peace Act (Rep. Act 875)
HELD:
Republic Act 875,SEC. 4, provides that it shall be unfair labor practice
for an employer to discriminate in regard to hire or tenure of employment or
any term or condition of employment to encourage or discourage membership
in any labor organization. As clearly established by the evidence, its refusal
to all complainants to work and requirement that the latter stay out of the
premises in the meantime (perhaps while the strike was still going on at the
factory) was borne out of the Company's justified apprehension and fear that
sabotage might be committed in the warehouse where the products machinery
and spare parts were stored, as has been the case in Binangonan. It has never
been shown that the act of the Company was intended to induce the
complainants to renounce their union-membership or as a deterrent for non-
members to affiliate therewith, nor as a retaliatory measure for activities in
the union or in furtherance of the cause of the union. As the strikers were
declared entitled to wages only from the finality of the decision in the main
case or from May 28, 1961, the award of back wages to herein complainants,
also from said date, is justified and reasonable. It may even be stated in
support thereof that on May 30,1956, complainants actually joined the picket
line formed in front of the Company's office at Escolta, Manila.Decision
affirmed.
STAMFORD MARKETING CORP., ET AL. VS. JOSEPHINE

JULIAN, ET AL.
Facts:
On November 2, 1994, Zoilo de la Cruz, president of the Philippine
Agricultural Commercial and Industrial Workers’ Union (PACIWU-TUCP),
sent a letter to Rosario Apacible, treasurer and general manager of Stamford
Marketing Corporation, GSP Manufacturing Corporation, Giorgio Antonio
Marketing Corporation, Clementine Marketing Corporation and Ultimate
Concept Phils., Inc. The letter informed her that the rank-and-file employees
of the said companies had formed the Apacible Enterprises Employee’s
Union-PACIWU-TUCP and demanded that it be recognized.
After such notice, PACIWU-TUCP filed, on behalf of 50 employees

allegedly dismissed illegally for union membership by the petitioners, a case
for unfair labor practice against GSP which denied such averments. GSP
countered that the BLR did not list Apacible Enterprises Employee’s Union
as a local chapter of PACIWU or TUCP. Thus, the strike that said union
organized after the GSP refused to negotiate with them was illegal and that
they refused to return to work when asked.
Issues:
Whether or not the respondents’ union officers and members were
validly and legally dismisses from employment considering the illegality of
the strike.
Held:
The termination of the union officers was legal under Article 264 of the
Labor Code as the strike conducted was illegal and that illegal acts attended
the mass action. Holding a strike is a right that could be availed of by a
legitimate labor organization, which the union is not. Also, the mandatory
requirements of following the procedures in conducting a strike under
paragraph (c) and (f) of Article 263 were not followed by the union officers.
Article 264 provides for the consequences of an illegal strike, as well

as the distinction between officers and members who participated therein.
Knowingly participating in an illegal strike is a sufficient ground to terminate
the employment of a union officer but mere participation is not sufficient
ground for termination of union members. Thus, absent clear and substantial
proof, rank-and-file union members may not be terminated. If he is
terminated, he is entitled to reinstatement.
CAPITOL MEDICAL CENTER, INC., v. HON. CRESENCIANO B.

TRAJANO, and CAPITOL MEDICAL CENTER EMPLOYEES
ASSOCIATION-AFW
Facts:
Respondent sent petitioner a letter requesting a negotiation of their
Collective Bargaining Agreement (CBA). Petitioner, however, challenged the
union’s legitimacy and refused to bargain with respondent. Subsequently
petitioner filed with the (BLR), Department of Labor and Employment, a
petition for cancellation of respondent’s certificate of registration. For its part,
respondent filed with the (NCMB), National Capital Region, a notice of strike.
Respondent alleged that petitioner’s refusal to bargain constitutes

unfair labor practice. Despite several conferences and efforts of the designated
conciliator-mediator, the parties failed to reach an amicable settlement.
Respondent staged a strike.
Issue:
Whether or not Secretary of Labor cannot exercise his powers under
Article 263 (g) of the Labor Code without observing the requirements of due
process.
Held:
The discretion to assume jurisdiction may be exercised by the Secretary
of Labor and Employment without the necessity of prior notice or hearing
given to any of the parties. The rationale for his primary assumption of
jurisdiction can justifiably rest on his own consideration of the exigency of
the situation in relation to the national interests.
The foregoing notwithstanding, the President of the Philippines shall

not be precluded from determining the industries that, in his opinion, are
indispensable to the national interest, and from intervening at any time and
assuming jurisdiction over any such labor dispute in order to settle or
terminate the same.
NATIONAL FEDERATION OF SUGAR WORKER (NFSW) vs.

OVEJERA
Facts:
NFSW has been the bargaining agent of CAC rank and file employees
(about 1200 of more than 2000 personnel) and has concluded with CAC a
collective bargaining agreement effective February 16, 1981 — February 15,
1984. On November 28, 1981, NFSW struck allegedly to compel the payment
of the 13th month pay under PD 851, in addition to the Christmas, milling and
amelioration bonuses being enjoyed by CAC workers. To settle the strike, a
compromise agreement was concluded between CAC and NFSW on
November 30,1981. Under paragraph 4 thereof — The parties agree to abide
by the final decision of the Supreme Court in any case involving the 13th
Month Pay Law if it is clearly held that the employer is liable to pay a 13th
month pay separate and distinct from the bonuses already given. As of
November 30, 1981, G.R. No. 51254 (Marcopper Mining Corp. vs. Blas Ople
and Amado Inciong, Minister and Deputy Minister of Labor, respectively, and
Marcopper Employees Labor Union, Petition for certiorari and Prohibition)
was still pending in the Supreme Court. The Petition had been dismissed on
June 11, 1981 on the vote of seven Justices. 1 A motion for reconsideration
thereafter filed was denied in a resolution dated December 15, 1981, with only
five Justices voting for denial. (3 dissented; 2 reserved their votes: 4 did not
take part.) On December 18, 1981 — the decision of June 11, 1981 having
become final and executory — entry of judgment was made. On January 22,
1982, NFSW filed with the Ministry of Labor and Employment (MOLE)
Regional Office in Bacolod City a notice to strike based on non-payment of
the 13th month pay. Six days after, NFSW struck. One day after the
commencement of the strike, or on January 29, 1982, a report of the strike-
vote was filed by NFSW with MOLE. On February 8, 1982, CAC filed a
petition (R.A.B. Case No. 0110-82) with the Regional Arbitration Branch VI-
A, MOLE, at Bacolod City to declare the strike illegal, principally for being
violative of Batas Pambansa Blg. 130, that is, the strike was declared before
the expiration of the 15-day cooling-off period for unfair labor practice (ULP)
strikes, and the strike was staged before the lapse of seven days from the
submission to MOLE of the result of the strike-vote. After the submission of
position papers and hearing, Labor Arbiter Ovejera declared the NFSW strike
illegal.
Issues:
1.W/N the strike declared by NFSW is illegal.
Held:
NFSW strike is illegal. — The NFSW declared the strike six (6) days
after filing a strike notice, i.e., before the lapse of the mandatory cooling-off
period. It also failed to file with the MOLE before launching the strike a report
on the strike-vote, when it should have filed such report "at least seven (7)
days before the intended strike." Under the circumstances, we are perforce
constrained to conclude that the strike staged by petitioner is not in conformity
with law. The cooling-off period and the 7-day strike ban after the filing of a
strike-vote report, as prescribed in Art. 264(now 263) of the Labor Code, are
reasonable restrictions and their impositions is essential to attain the
legitimate policy objectives embodied in the law. We hold that they constitute
a valid exercise of the police power of the state. If the purposes of the required
strike notice and strike-vote report are to be achieved, the periods prescribed
for their attainment must, as aforesaid, be deemed mandatory.
GOLD CITY vs. NLRC
Facts:
Bacalso was employed as an admeasurer by gold city integrated port
services, inc. (gold city) the management, suspecting undermeasuring of the
cargo, ordered two other admeasurers to remeasure the three (3) pallets of
bananas already measusred by bacalso. the remeasurement revealed thet
bacalso under-measured the bananas by 1.427 cubic meter. Bacalso felt
insulted by remeasurement. in the office of the chief admeasurer, mr. guangco,
he confronted Mabalacad, one of the two (2) admeasurers who had rechecked
his work, a quarrel ensued between Basalco and Mabalacad in the presence of
Guangco, their immediate superior. Guangco told Bacalso to stop provoking
Mabalacad and asked them that, being in his office, they should behave
properly. Bacalso ignored this oral directive and fistfight erupted then and
there between him and Mabalacad. Both were eventually pacified by their co-
workers. Bacalso was charged with assaulting a co-employee and falsifying
reports and records of he company relative to the performance of his duties,
and was preventively suspended pending investigation of his case by the
union-management grievance committee. On april 11,1987 Bacalso receive a
notice of termination of services upon the grounds of assaulting a co-
employee and insubordination.
Issue:
W/N Bacalso was illegally terminated?
Held:
Bacalso completely disregarded the courtesy and respect due from a
subordinate to hid superior. indeed, he may have been, consciously or
otherwise, precisely sending a signal to is superior officer in whose presence
to provoked and then engaged in physical violence with his co-worker. prior
to his fistfight, Guangco had arned basal o to desist from further provoking
his co-worker with insulting language. this warning constituted an order from
Bacalso's immediate from superior not to breach the peace and order of the
surveyors (admeasurers) division; Guangco was obviously attempting to
maintain basic employee discipline in the workplace. In the instant case,
Bacalso disorderly behavior did not present a comparable threat to the safety
or peace of ind of his co-workers or that of the customers of Gold City.
Considering that Bacalso's unruly temper did not become an effective threat
to his co-worker or the safety of the costumers dealing with his employer or
to the goodwill of his employer, and considering further that he had been quite
candid in admitting that he had been at fault as soon as the investigation began
in the company level, we agree with the NLRC that termination of his services
was a disproportionately heavy penalty. We believe that suspension without
pay for three (3) months would be an adequate penalty for the assault on a co-
worker and act of insubordination that Bacalso actually committed.
SUKHOTHAI CUISINE vs. CA (NLRC, PLAC)
Facts:
On December 3, 1998, employees of Sukhothai Cuisine and Restaurant
(duly organized as a union, affiliated with private respondent Philippine Labor
Alliance Council [PLAC], and designated as PLAC local 460 Sukhothai
chapter) filed a Notice of Strike with the National Conciliation and Mediation
Board (NCMB) on the ground of unfair labor practice (ULP) and particularly,
acts of harassment, fault-finding, and union busting through coercion and
interference with union affairs. In a subsequent conciliation conference,
representatives of the petitioner agreed and guaranteed that there will be no
termination of the services of private respondents during the pendency of the
case, with the reservation of the management prerogative to issue memos to
erring employees for the infraction, or violation of company policies. private
respondent Jose Lanorias, likewise a union member, was relieved from his
post and terminated from employment. Shortly thereafter, respondents staged
a “wildcat strike” which was later transformed into an “actual strike.” On June
29, 1999, the petitioner filed a complaint for illegal strike with the NLRC
against private respondents, and for a declaration that respondents who
participated in the commission of illegal acts have lost their employment
status. The Labor Arbiter ruled in favor of petitioner and held that the Notice
of Strike and the Strike Vote referred to a prior dispute submitted for voluntary
arbitration and cannot apply to the strike staged about six months later; that,
instead of resorting to a strike, private respondents should have availed of the
proper legal remedies such as the filing of complaints for illegal suspension
or illegal dismissal with the NLRC; and that even if private respondents
complied with all the requisites of a valid strike, the strike is still illegal due
to the commission of prohibited acts. Private respondents appealed to the
NLRC which decided in their favour and held that the petitioner is guilty of
union busting; of violating the Submission Agreement that no termination
shall be effected during the voluntary arbitration proceedings; that the Notice
of Strike and Strike Vote are applicable to the strike of June 24, 25, and 26,
1999 since the same issues of ULP were involved and that ULPs are
continuing offenses. After the NLRC denied the MFR, petitioner appealed to
the CA, which later denied the petition and affirmed the NLRC hence this
case.
ISSUES:
W/N the strike was illegal?
HELD:
The strike was illegal. Art.264 “No strike or lockout shall be declared
after assumption of jurisdiction by the Pres. or the Secretary or after
certification or submission of the dispute to compulsory or voluntary
arbitration or during the pendency of cases involving the same grounds for the
strike or lockout.” Strikes staged in violation of agreements providing for
arbitration are illegal, since these agreements must be strictly adhered to and
respected if their ends are to be achieved, for it is among the chief policies of
the State to promote and emphasize the primacy of free collective bargaining
and negotiations, including voluntary arbitration, mediation, and conciliation,
as modes of settling labor, or industrial disputes. Reasoning Once jurisdiction
over the labor dispute has been properly acquired by competent authority, that
jurisdiction should not be interfered with by the application of the coercive
processes of a strike.
MANILA DIAMOND HOTEL EMPLOYEES’ UNION vs. THE HON.

COURT OF APPEALS, THE SECRETARY OF LABOR AND
EMPLOYMENT, and THE MANILA DIAMOND HOTEL
FACTS:
The Union filed a petition for a certification election so that it may be
declared the exclusive bargaining representative of the Hotel’s employees for
the purpose of collective bargaining but was dismissed by the Department of
Labor and Employment (DOLE).
However, the Union staged a strike against the Hotel. Numerous

confrontations between the two parties followed, creating an obvious strain
between them.
The Secretary of Labor and Employment issued a return to work order

within twenty-four(24) hoursu pon receipt, the Hotel, however, refused to
accept the returning workers and instead filed a Motion for Reconsideration
of the Secretary’s Order.
On April 30, 1998, then Acting Secretary of Labor Jose M. Español,
issued the disputed Order, which modified the earlier one issued by Secretary
Trajano. Instead of an actual return to work, Acting Secretary Español
directed that the strikers be reinstated only in the payroll. The Union moved
for the reconsideration of this Order, but its motion was denied on June 25,
1998. Hence, it filed before this Court on August 26, 1998, a petition
for certiorari under Rule 65 of the Rules of Court alleging grave abuse of
discretion on the part of the Secretary of Labor for modifying its earlier order
and requiring instead the reinstatement of the employees in the payroll.
ISSUE:
Whether or not the Court of Appeals grieviously erred in ruling that the
Secretary of Labor’s unauthorized order of mere “payroll reinstatement” is
not a grave abuse of discretion.
HELD:
Under Article 263(g), all workers must immediately return to work and
all employers must readmit all of them under the same terms and conditions
prevailing before the strike or lockout.
It was an error on the part of the Court of Appeals to view the

assumption order of the Secretary as a measure to protect the striking workers
from any retaliatory action from the Hotel. This Court reiterates that this law
was written as a means to be used by the State to protect itself from an
emergency or crisis. It is not for labor, nor is it for management.
PNOC DOCKYARD AND ENGINEERING CORPORATION v. NLRC
FACTS:
Private respondent (KMM-PDEC), among unions namely: BRUP,
PEDEA, PCC-ELU and PSTCEA, filed with the DOLE a notice of strike
against Phil. National Oil Company (PNOC) and Monico Jacob as
President/Chairman, on the ground of discrimination constituting ULP.The
dispute arose from the grant by petitioner and PNOC of the amount of
P2,500.00 increase in monthly salaries to Managerial, Professionals and
Technical Employees (MPT) but not to Non-Managerial, Professional and
Technical Employees (NMPT). Acting Secretary Nieves Confesor certified
the dispute subject of the notice of strike to the NLRC for compulsory
arbitration. The day when respondent union was poised to strike, its officers
and members decided to report for work but petitioner thru its Operations
Manager, Nemesio Guillermo, padlocked the gate and refused entry to the
employees. Some officers and members of respondent union were able to
enter the premises of petitioner and punch-in their timecards; however, they
were immediately escorted back outside. Confesor issued a return to work
order directing all striking workers to return to work within 24 hours form
receipt of the Order and for the Company to accept them under the same terms
and conditions prevailing prior to the work stoppage. Respondent union thru
its President, Felimon Paglinawan filed before the NLRC a complaint against
petitioner for Illegal Lock-out. All members of the private respondent union
reported and were accepted back to work. Subsequently, petitioner filed
before the DOLE a petition to declare the strike illegal with a motion to cite
the striking workers in contempt for defying the DOLE Orders. the President,
Secretary, Auditor and Treasurer of the respondent union, after due notice and
investigation, were dismissed by petitioner from their employment on the
ground, among others of their participation in the work stoppage on December
18 to 21, 1991concluding upon the illegality of the union activity and
dismissing outright the union officers involved. Moreover, the MOA, other
than enjoining the striking workers to return to work, likewise ordered the
management to accept them under the same terms and conditions prevailing
prior to the work stoppage. In glaring defiance, petitioner arbitrarily
undertook to change the work schedule of some employee on the very day
they resumed work, aside from deducting in full the wages and holiday pays
of the striking employees pertaining to the strike period, even before the LMC
could convene.
ISSUE:
W/N the claim of the petitioner is tenable.
HELD:
The strike was legal. Having ruled that the strike staged by respondent
unions was legal, the subsequent dismissals of their officers due to their
staging of said strike cannot be countenanced. The actual and exemplary
damages sought by petitioner have no basis in law, much less in equity and
fair play. From the foregoing discussion, the strike was staged by respondent
unions in the honest belief that petitioner, among the other PNOC subsidiaries
involved, was guilty of unfair labor practice due to the discrimination in the
grant of salary increase believed to discourage union membership, and to its
refusal to bargain collectively on the matter. There was good faith on the part
of the striking unions. Thus, they cannot be penalized by imposing upon them
payment of damages.
Malayang Samahan ng mga Manggagawa sa Greenfield v. Ramos
Facts:
In February 1990, M. Greenfield, Inc. (MGI), through its officers Saul
Tawil, Carlos Javelosa, and Renato Puangco began terminating employees.
The corporation closed down one of their plants and so they said they have to
retrench the number of employees. Consequently, the Malayang Samahan ng
mga Manggagawa sa M. Greenfield (MSMG-UWP) filed an illegal dismissal
case against MGI. The National Labor Relations Commission, chaired by
Cresencio Ramos, ruled against the union. But on appeal, the decision of the
NLRC was reversed and the corporation was ordered, among others, to pay
the employees’ backwages. The union further appealed as they contend that
the officers of the corporation should be held solidarily liable.
Issue:
Whether or not the officers of the corporation should be held solidarily
liable
Held:
No. A corporation is a juridical entity with legal personality separate
and distinct from those acting for and in its behalf and, in general from the
people comprising it. The rule is that obligations incurred by the corporation,
acting through its directors, officers and employees are its sole liabilities.
There is no question that MGI is guilty of illegal dismissal but the officers
cannot be held solidarily liable.
It’s true that there’s a plethora of illegal dismissal cases where the SC
made corporate officers personally liable but these cases usually involve
corporate officers who acted in bad faith in illegally dismissing employees.
Corporate directors and officers may be solidarily liable with the corporation
for the termination of employment of corporate employees if the same is done
with malice or in bad faith.
INTERWOOD EMPLOYEES ASSOCIATION, vs. INTERNATIONAL

HARDWOOD & VENEER COMPANY OF THE PHILIPPINES
(INTERWOOD);
FACTS:
Mr. Enrique Marcelo, president of the Interwood Employees
Association,was originally employed by the petitioner since July 26, 1949, as
shop helper with a daily compensation of P3. Desiring to move to a better
position in the company, he tendered a letter of resignation from his current
position to make himself available for another position. However, he later
found out that the new position was not available. He then tried
to go back to his original position but was refused by management on the
ground that the old position had been abolished. The union declared a strike
on his behalf.
ISSUE:
Whether or not the striking union members should be dismissed for
fighting for the cause of Mr. Marcelo.
HELD:
Unemployment is rife, as at present, dismissal may mean risk of
starvation for the laborers and their families. It is practically conceded, and
there is no showing otherwise, that the labor union declared the strike in the
honest belief that Marcelo had been dismissed because of union activities, and
no unlawful means were employed. Such action cannot be regarded as trivial,
illegal or unreasonable: defense of its members goes to the very root of a
union's reason for existence. I concede that the strike was injudicious and
hasty, since no serious attempt was made to ascertain the side of management.
But it seems to me that reinstatement without backpay would have been a
sufficient stern sanction for such inconsiderate action and a reminder against
its repetition in the future. Nor is the guilt of the union in acting without due
inquiry upon the biased report of its president (Marcelo) too serious or
unprecedented an offense. Our experience is that precipitate action upon one-
sided reports is not confined to labor unions. The truth is that if in labor capital
conflicts labor is often too quick to conclude that every move of management
is an attempt to grind it back to slavery, so are capital and management much
too predisposed to view every petition of labor as unjustified demand and
harassing insolence. Save rare and honorable exceptions, both sides appear to
suffer from emotional infantilism. In the present case it does not appear that
management endeavoured to present the true facts to the union. Had it done
so, the strike would have probably been averted, for a laborer does not take
lightly to the suspension of the earnings upon which he and his family depend
for their living.
FIRST CITY INTERLINK TRANSPORTATION CO., INC., vs. THE

HONORABLE SECRETARY MA. NIEVES ROLDAN-CONFESOR
and NAGKAKAISANG MANGGAGAWA NG FIL TRANSIT-
NATIONAL FEDERATION OF LABOR (NMF-NFL)
Facts:
On May 27, 1986, the Fil Transit Employees Union filed a notice of
strike with the Bureau of Labor Relations (BLR) because of alleged unfair
labor practice of petitioner. Despite several conciliation conferences, the
parties failed to reach an agreement, so that, on June 17, 1986, the Union went
on strike. As a result several workers were dismissed. The Union filed
another notice of strike alleging unfair labor practice, massive dismissal of
union officers and members, coercion of employees and violation of workers’
rights to self-organization. Conciliation conferences were again held but, on
July 27, 1986, the Union again went on strike, lifting their picket only on
August 2, 1986.
Issue:
Whether or not the strike called by the Union was illegal.
Held:
Petitioner contends that the strike staged by the Union was illegal
because no strike vote had been taken before the strike was called. However,
in none of the numerous pleadings filed by respondent Union before this
Court, has it been shown that a strike vote had been taken before declaring a
strike. As between petitioner and respondent Union, the latter is in a better
position to present proof of such fact. The Union’s failure to do so raises the
strong probability that there was no strike vote taken. The first and only
instance it is mentioned that such a vote had been taken before the strike was
called was in the order dated July 23, 1992 of the Secretary of Labor.
Moreover, even assuming that a strike vote had been taken, we agree
with petitioner that the Union nevertheless failed to observe the required
seven-day strike ban from the date the strike vote should have been reported
to the DOLE up to the time the Union staged the strike on June 17, 1986.
Security Bank Employees Union v. Security Bank and Trust Co.
Facts:
The union despite various TRO’s and return to work orders by the court,
still held their strike. The union contends that the lower court judge
committed grave abuse of discretion when he issued ex parte a restraining
order prohibiting the workers from staging or continuing a strike or picketing
"of whatever kind or form, particularly, at plaintiff's main office at Escolta,
Manila," as well as any of its branches.
Issue:
Whether or not there is lawful picketing?
Held:
It is true that respondent Bank is in the unenviable position of an
innocent bystander caught in the cross-fire. It enlists one's sympathy, but it
cannot with reason assert that its difficulties are in no way connected with a
labor controversy. Besides, it is now too late to consider as lacking the
elements of a labor dispute a situation where rival unions vie for supremacy.
This court has so indicated in at least two decisions, Balaquezon Trans.
PCIB V. Philnabank Employees
Facts:
There is a unique aspect to this action for libel against the Philippine
National Bank Employees' Association. It was filed by plaintiff PCIB as a
result of placards and signboards along the PNB building in Escolta, Manila,
containing the following: "PCIB BAD ACCOUNTS TRANSFERRED TO
PNB-NIDC?" The allegation of its being libelous was denied by defendants
on the ground that such placards "containing the alleged writing were
displayed during the strike on April 3 and April 4,1967 as a fair, legal labor
strategy denouncing the lack of business foresight, incompetence,
mismanagement, arbitrary and despotic acts of the Management to heed the
legal and legitimate demands of the defendants, as a striking union, and
against whom a strike was declared against the management of the Philippine
National Bank" and that moreover, "defendants, during the strike on April 3
to April 4, 1967, against the management of the Philippine National Bank,
were only moved by good intention and justifiable motives and did not intend
to injure any party not connected with the strike;" constituting part "of their
legal and fair labor strategy to enforce their demands" and to bolster their
imputation of incompetence and arbitrariness of the Philippine National Bank
management. The lower court sustained such a defense and dismissed the
complaint. Hence this appeal.
Issue:
W/N the lower court erred in dismissing the libel case filed by PCIB
against Philnabank Employees?
Held:
The decision of the then Judge Conrado Vasquez was to dismiss the
complaint. He could not discern any libelous imputation in the alleged
offending words. Such a ruling finds additional support in the sympathetic
approach followed by courts to inaccuracies and imprecision in language in
the use of placards as part of peaceful picketing in labor controversies. If the
realistic observation of Justice Frankfurter in Milk Wagon Drivers Union of
Chicago v. Meadowmoor Dairies be heeded that labor disputes give rise to
strong emotional response, then the decision reached by the lower court
becomes even more acceptable. It is a fact of industrial life, both in the
Philippines as in the United States, that in the continuing confrontation
between labor and management, it is far from likely that the language
employed would be both courteous and polite. Such being the case, there is
no affront either to reason or to the law in the complaint for libel being
dismissed. In placing reliance on the constitutional right of freedom of
expression, this Court once again makes manifest its adherence to the
principle first announced by Justice Malcolm as ponente in the leading case
of United States v. Bustos. In no uncertain terms, it made clear that the
judiciary, in deciding suits for libel, must ascertain whether or not the alleged
offending words may be embraced by the guarantees of free speech and free
press. The appealed decision is affirmed.
FREE TELEPHONE WORKERS UNION vs. THE HONORABLE

MINISTER OF LABOR AND EMPLOYMENT, THE NATIONAL
LABORRELATIONS COMMISSION, and THE PHILIPPINE LONG
DISTANCE TELEPHONECOMPANY,October 30, 1981
FACTS:
On September 14, 1981, there was a notice of strike with the Ministry
of Labor for unfair labor practices stating the following grounds" 1) Unilateral
and arbitrary implementation of a Code of Conduct to the detriment of the
interest of our members; 2) Illegal terminations and suspensions of our
officers and members as a result of the implementation of said Code of
Conduct; and 3) Unconfirmation of call sick leaves and its automatic
treatment as Absence Without Official Leave of Absence (AWOL) with
corresponding suspensions, in violation of our Collective Bargaining
Agreement." Several conciliation meetings called by the Ministry followed,
with petitioner manifesting its willingness to have a revised Code of Conduct
that would be fair to all concerned but with a plea that in the meanwhile the
Code of Conduct being imposed be suspended a position that failed to meet
the approval of private respondent. Subsequently, respondent Ministry,
certified the labor dispute to the National Labor Relations Commission for
compulsory arbitration and enjoined any strike at the private respondent's
establishment. The labor dispute was set for hearing by respondent National
Labor Relations Commission. Private respondent, following the lead of
petitioner labor union, explained its side on the controversy regarding the
Code of Conduct, the provisions of which as alleged in the petition were quite
harsh, resulting in what it deemed indefinite preventive suspension apparently
the principal cause of the labor dispute.It is now the submission of petitioner
labor union Free Telephone Workers Unionthat "Batas Pambansa Blg. 130 in
so far as it amends article 264 of the Labor Code delegating to the Honorable
Minister of Labor and Employment the power and discretion to assume
jurisdiction and/or certify strikes for compulsory arbitration to the National
Labor Relations Commission, and in effect make or unmake the law on free
collective bargaining, is an undue delegation of legislative powers. There is
likewise the assertion that such conferment of authority "may also ran contrary
to the assurance of the State to the workers' right to self-organization and
collective bargaining.
ISSUE:
Whether BP 130 amending Art. 264 of the Labor Code is an undue
delegation of legislative powers?
HELD:
Batas Pambansa Blg. 130 insofar as it empowers the Minister of Labor
to assume jurisdiction over labor disputes causing or likely to cause strikes or
lockouts adversely affecting the national interest and thereafter decide it or
certify the same the National Labor Relations Commission is not on its face
unconstitutional for being violative of the doctrine of non-delegation of
legislative power.
LIWAYWAY PUBLICATIONS INC. VS. PERMANENT CONCRETE

WORKERS UNION
FACTS:
Liwayway Publication Inc was the second sub lessee of the premises of
the respondent Permanent Concrete Products in Manila. The employees of
the latter declared a strike. For unknown reason they picketed, stopped, and
prohibited Liwayway’s truck from entering the compound to load newsprint
from its bodega. The union members also intimidated and threatened to harm
the Liwayway’s employees who were in the truck.
Liwayway filed an action for damages and injunction against the union in the
CFI Manila. CFI issued preliminary injunction and award to Liwayway. The
Union contends that CFI has no jurisdiction over the case because the case
arose out of labor dispute and that their picketing is an extension of the
freedom of speech guaranteed by the Constitution.
ISSUE:
Whether Liwayway is a third party or an innocent bystander whose
right has been invaded and therefore entitled to protection by regular courts.
HELD:
Yes. We find and hold that there is no connection between the
Liwayway Publication Inc and the striking union. Although picketing is not
prohibited, a picketing labor union has no right to prevent employees of
another company from getting in and out of its rented premises, Otherwise, it
will be held liable for damages for its act against innocent bystander.
MSF Tire and Rubber vs CA
Facts:
During the pendency of the labor dispute, Philtread entered into a
Memorandum of Agreement with Siam Tyre whereby its plant and equipment
would be sold to a new company, herein petitioner, 80% of which would be
owned by Siam Tyre and 20% by Philtread, while the land on which the plant
was located would be sold to another company, 60% of which would be
owned by Philtread and 40% by Siam Tyre.
Petitioner then asked respondent Union to desist from picketing outside

its plant. As the respondent Union refused petitioner’s request, petitioner filed
a complaint for injunction with damages before the RTC. Petitioner asserts
that its status as an “innocent bystander” with respect to the labor dispute
between Philtread and the Union entitles it to a writ of injunction from the
civil courts.
Issue:
WON petitioner has shown a clear legal right to the issuance of a writ
of injunction under the “innocent bystander” rule.
Held:
The right to picket as a means of communicating the facts of a labor
dispute is a phase of the freedom of speech guaranteed by the constitution. If
peacefully carried out, it cannot be curtailed even in the absence of employer-
employee relationship.
The right is, however, not an absolute one. Thus, an “innocent

bystander,” who seeks to enjoin a labor strike, must satisfy the court it is
entirely different from, without any connection whatsoever to, either party to
the dispute and, therefore, its interests are totally foreign to the context
thereof.
In the case at bar, we find that the “negotiation, contract of sale, and the
post transaction” between Philtread, as vendor, and Siam Tyre, as vendee,
reveals a legal relation between them which, in the interest of petitioner, we
cannot ignore. To be sure, the transaction between Philtread and Siam Tyre,
was not a simple sale whereby Philtread ceased to have any proprietary rights
over its sold assets. On the contrary, Philtread remains as 20% owner of
private respondent and 60% owner of Sucat Land Corporation which was
likewise incorporated in accordance with the terms of the Memorandum of
Agreement with Siam Tyre, and which now owns the land were subject plant
is located. This, together with the fact that private respondent uses the same
plant or factory; similar or substantially the same working conditions; same
machinery, tools, and equipment; and manufacture the same products as
Philtread, lead us to safely conclude that private respondent’s personality is
so closely linked to Philtread as to bar its entitlement to an injunctive writ.
Ilaw at Buklod ng Manggagawa v. NLRC
Facts:
There was a wage order that caused a wage distortion within the
company.
Union then proposed to the mgt. that the wage distortion be corrected
by implementing a 25php wage increase, which it later lowered to 15php. The
Company, however, only effected a 7php wage increase. The union
considered the management’s move as the company ignoring their demands.
As a result, the union decided to work only for 8 hours per day, against
the company practice for 5 years of having the workers work 10 to 14-hour
work shifts.
This caused the company, SMC losses, due to diminished productivity,

prompting it to file a complaint with the NLRC seeking the declaration of the
said union’s activity (strike/slowdown) as illegal.
Issue:
Whether or not said slowdown/strike is illegal
Held:
It is illegal, on several grounds.
The Court concedes the workers’ right to self organization and to
concerted activities in exercise of that right. The Court also pointed out that
common examples are strike/temporary stoppage of work, and picketing.
However, the Court also points out that such right is not absolute and
may be limited by law. In this case, the Court pointed out that:
The legality of these activities is usually dependent on the legality of

the purposes sought to be attained and the means employedtherefor. These
joint or coordinated activities may be forbidden or restricted by law or
contract.
In the particular instance of "distortions of the wage structure within an

establishment" resulting from "the application of any prescribed wage
increase by virtue of a law or wage order," Section 3 of Republic Act No.
6727 prescribes a specific, detailed and comprehensive procedure for the
correction thereof, thereby implicitly excluding strikes or lockouts or other
concerted activities as modes of settlement of the issue.
DANILO B. TABAS vs. CALIFORNIA MANUFACTURING

COMPANY, INC
FACTS:
Petitioners were, prior to their stint with California, employees of Livi
Manpower Services, Inc. (Livi), which subsequently assigned them to work
as promotional merchandisers for the former firm pursuant to a manpower
supply agreement. Among other things, the agreement provided that
California has no control or supervisions whatsoever over Livi's workers with
respect to how they accomplish their work or perform Californias obligation.
The Livi is an independent contractor and nothing herein contained shall be
construed as creating between California and Livi. The relationship of
principal-agent or employer-employee that it is hereby agreed that it is the
sole responsibility of Livi to comply with all existing as well as future laws,
rules and regulations pertinent to employment of labor and that California is
free and harmless from any liability arising from such laws or from any
accident that may befall workers and employees of Livi while in the
performance of their duties for California.
It was further expressly stipulated that the assignment of workers to

California shall be on a seasonal and contractual basis that cost of living
allowance and the 10 legal holidays will be charged directly to California at
cost and that payroll for the preceding week shall be delivered by Livi at
California's premises.
The petitioners now allege that they had become regular California
employees and demand, as a consequence whereof, similar benefits. They
likewise claim that pending further proceedings below, they were notified by
California that they would not be rehired. As a result, they filed an amended
complaint charging California with illegal dismissal.
ISSUES:
Whether or not the petitioners are California's or Livi's employees.
HELD:
There is no doubt that in the case at bar, Livi performs "manpower
services", meaning to say, it contracts out labor in favor of clients. We hold
that it is one notwithstanding its vehement claims to the contrary, and
notwithstanding the provision of the contract that it is "an independent
contractor." The nature of one's business is not determined by self-serving
appellations one attaches thereto but by the tests provided by statute and
prevailing case law.
A temporary or casual employee, under Article 218 of the Labor Code,

becomes regular after service of one year, unless he has been contracted for a
specific project. And we cannot say that merchandising is a specific project
for the obvious reason that it is an activity related to the day-to-day operations
of California.
SOCIAL SECURITY SYSTEM vs. THE COURT OF APPEALS and

CONCHITA AYALDE.
FACTS:
In a petition before the Social Security Commission, Margarita Tana,
widow of the late Ignacio Tana, Sr., alleged that her husband was, before his
demise, an employee of Conchita Ayalde as a farmhand in the two (2)
sugarcane plantations she owned and leased from the University of the
Philippines. She further alleged that Tana worked continuously six (6) days a
week, four (4) weeks a month, and for twelve (12) months every year between
January 1961 to April 1979. For his labor, Tana allegedly received a regular
salary according to the minimum wage prevailing at the time. She further
alleged that throughout the given period, social security contributions, as well
as medicare and employees compensation premiums were deducted from
Tana’s wages. It was only after his death that Margarita discovered that Tana
was never reported for coverage, nor were his contributions/premiums
remitted to the Social Security System (SSS). Consequently, she was
deprived of the burial grant and pension benefits accruing to the heirs of Tana
had he been reported for coverage.
ISSUE:
Whether or not an agricultural laborer who was hired on “pakyaw”
basis can be considered an employee entitled to compulsory coverage and
corresponding benefits under the Social Security Law.
HELD:
The mandatory coverage under the SSS Law (Republic Act No. 1161,
as amended by PD 1202 and PD 1636) is premised on the existence of an
employer-employee relationship, and Section 8(d) defines an “employee” as
“any person who performs services for an employer in which either or both
mental and physical efforts are used and who receives compensation for such
services where there is an employer-employee relationship.”
There is no question that Tana was selected and his services engaged
by either Ayalde herself, or by Antero Maghari, her overseer. Corollarily,
they also held the prerogative of dismissing or terminating Tana’s
employment. The dispute is in the question of payment of wages. Claimant
Margarita Tana and her corroborating witnesses testified that her husband was
paid daily wages “per quincena” as well as on “pakyaw” basis. Ayalde, on
the other hand, insists that Tana was paid solely on “pakyaw” basis. To
support her claim, she presented payrolls covering the period January of 1974
to January of 1976; and November of 1978 to May of 1979.
BROTHERHOOD LABOR UNITY MOVEMENT OF THE

PHILIPPINES, vs. HON. RONALDO B. ZAMORA
FACTS:
Petitioners are workers who have been employed at the San Miguel
Parola Glass Factory since 1961, averaging about seven (7) years of service
at the time of their termination. They worked as "cargadores" or "pahinante"
at the SMC Plant loading, unloading, piling or palleting empty bottles and
woosen shells to and from company trucks and warehouses. At times, they
accompanied the company trucks on their delivery routes.
Work in the glass factory was neither regular nor continuous, depending
wholly on the volume of bottles manufactured to be loaded and unloaded.
Petitioners were paid every ten (10) days on a piece rate basis, that is,
according to the number of cartons and wooden shells they were able to load,
unload, or pile.
ISSUE:
Whether or not an employer-employee relationship exists between
petitioners-members of the Brotherhood Labor Unit Movement of the
Philippines (BLUM) and respondent San Miguel Corporation.
HELD:
In determining the existence of an employer-employee relationship, the
elements that are generally considered are the following: (a) the selection and
engagement of the employee; (b) the payment of wages; (c) the power of
dismissal; and (d) the employer's power to control the employee with respect
to the means and methods by which the work is to be accomplished. It. is the
called "control test" that is the most important element
Applying the above criteria, the evidence strongly indicates the existence of
an employer-employee relationship between petitioner workers and
respondent San Miguel Corporation. The respondent asserts that the
petitioners are employees of the Guaranteed Labor Contractor, an independent
labor contracting firm.
JOSE Y. SONZA. vs. ABS-CBN BROADCASTING CORPORATION,
FACTS:
In May 1994, respondent ABS-CBN Broadcasting Corporation (“ABS-
CBN”) signed an Agreement (“Agreement”) with the Mel and Jay
Management and Development Corporation (“MJMDC”). Referred to in the
Agreement as “AGENT,” MJMDC agreed to provide SONZA’s services
exclusively to ABS-CBN as talent for radio and television. The Agreement
listed the services SONZA would render to ABS-CBN, as Co-host for Mel &
Jay radio program, 8:00 to 10:00 a.m., Mondays to Fridays; and Co-host for
Mel & Jay television program, 5:30 to 7:00 p.m., Sundays.
ABS-CBN agreed to pay for SONZA’s services a monthly talent fee of

P310,000 for the first year and P317,000 for the second and third year of the
Agreement. ABS-CBN would pay the talent fees on the 10th and 25th days of
the month.
On 30 April 1996, SONZA filed a complaint against ABS-CBN before

the Department of Labor and Employment, National Capital Region in
Quezon City. SONZA complained that ABS-CBN did not pay his salaries,
separation pay, service incentive leave pay, 13th month pay, signing bonus,
travel allowance and amounts due under the Employees Stock Option Plan
(“ESOP”).
ISSUES:
Whether or not an employer-employee relationship existed between
Sonza and ABS-CBN.
HELD:
The Court of Appeals ruled that the existence of an employer-employee
relationship between SONZA and ABS-CBN is a factual question that is
within the jurisdiction of the NLRC to resolve. A special civil action for
certiorari extends only to issues of want or excess of jurisdiction of the NLRC.
Such action cannot cover an inquiry into the correctness of the evaluation of
the evidence which served as basis of the NLRC’s conclusion.
All essential elements of an employer-employee relationship are present in
this case. Case law has consistently held that the elements of an employer-
employee relationship are: (a) the selection and engagement of the employee;
(b) the payment of wages; (c) the power of dismissal; and (d) the employer’s
power to control the employee on the means and methods by which the work
is accomplished. The last element, the so-called “control test”, is the most
important element.
ZANOTTE SHOES/LEONARDO LORENZO vs. NATIONAL LABOR

RELATIONS COMMISSION
FACTS:
Private respondents filed a complaint for illegal dismissal and for
various monetary claims, including the recovery of damages and attorney's
fees, against petitioners. In their supplemental position paper, the
complainants subsequently confined themselves to the illegal dismissal
charge and abandoned the monetary claims
They worked for a minimum of twelve hours daily, including Sundays

and holidays when needed; that they were paid on piece-work basis; that it
"angered" petitioner Lorenzo when they requested to be made members of the
Social Security System ("SSS"); and that, when they demanded an increase in
their pay rates, they were prevented (starting 24 October 1988) from entering
the work premises.
Petitioners, in turn, claimed that their business operations were only

seasonal, normally twice a year, one in June (coinciding with the opening of
school classes) and another in December (during the Christmas holidays),
when heavy job orders would come in. Private respondents, according to
petitioners, were engaged on purely contractual basis and paid the rates
conformably with their respective agreements.
ISSUE:
Whether or not employer-employee relationship existed between
petitioners and private respondents.
HELD:
Well-settled is the rule that factual findings of the NLRC, particularly
when they coincide with that of the Labor Arbiter, are accorded respect, if not
finality, and will not be disturbed absent any showing that substantial
evidence which might otherwise affect the result of the case has been
discarded. We see no reason, in this case at bench, for disturbing the findings
of the Labor Arbiter and the NLRC on the existence of an employer-employee
relationship between herein private parties. The work of private respondents
is clearly related to, and in the pursuit of, the principal business activity of
petitioners. The indicia used for determining the existence of an employer-
employee relationship, all extant in the case at bench, include (a) the selection
and engagement of the employee; (b) the payment of wages; (c) the power of
dismissal; and (d) the employer's power to control the employee with respect
to the result of the work to be done and to the means and methods by which
the work to be done and to the means and methods by which the work is to be
accomplished. The requirement, so herein posed as an issue, refers to the
existence of the right to control and not necessarily to the actual exercise of
the right.
INSULAR LIFE ASSURANCE CO., LTD. vs. NATIONAL LABOR

RELATIONS COMMISSION, (G.R. No. 119930. March 12, 1998)
FACTS:
On July 2, 1968, Insular Life Assurance Co., Ltd. and Melecio T.
Basiao entered into a contract by which Basiao was authorized to solicit
within the Philippines applications for insurance policies and annuities in
accordance with the existing rules and regulations of the Company; he would
receive compensation, in the form of commissions as provided in the Schedule
of Commissions of the contract to constitute a part of the consideration of
agreement; and the rules in Rate Book and its Agent's Manual, as well as all
its circulars and those which may from time to time be promulgated by it,
were made part of said contract.
Some four years later, the parties entered into another contract — an
Agency Manager's Contract — and to implement his end of it Basiao
organized an agency or office to which he gave the name M. Basiao and
Associates, while concurrently fulfilling his commitments under the first
contract with the Company.
In May, 1979, the Company terminated the Agency Manager's

Contract. After vainly seeking a reconsideration, Basiao sued the Company in
a civil action and this, he was later to claim, prompted the latter to terminate
also his engagement under the first contract and to stop payment of his
commissions starting April 1, 1980.
Basiao thereafter filed with the then Ministry of Labor a complaint against the
Company and its president.
ISSUE:
Whether or not, Basiao had become the Company's employee by virtue
of the contract invoked by him, thereby placing his claim for unpaid
commissions within the original and exclusive jurisdiction of the Labor
Arbiter under the provisions of Section 217 of the Labor Code.
HELD:
In determining the existence of employer-employee relationship, the
following elements are generally considered, namely: (1) the selection and
engagement of the employee; (2) the payment of wages; (3) the power of
dismissal; and (4) the power to control the employees' conduct although the
latter is the most important element.
The Court, therefore, rules that under the contract invoked by him,
Basiao was not an employee of the petitioner, but a commission agent, an
independent contractor whose claim for unpaid commissions should have
been litigated in an ordinary civil action.
FRANCISCO SORIANO, JR., vs. NATIONAL LABOR RELATIONS
COMMISSION.
FACTS:
In its Decision and Resolution, the NLRC affirmed the Decision of
Labor Arbiter Joel S. Lustria (Labor Arbiter Lustria) dated 23 March 2000 in
NLRC-NCR Case No. 00-08-05259-966 dismissing the petitioner’s complaint
for illegal dismissal against respondent Philippine Long Distance Telephone
Company, Incorporated.
In 1980, petitioner and certain individuals namely Sergio Benjamin

(Benjamin), Maximino Gonzales (Gonzales), and Noel Apostol (Apostol)
were employed by the respondent as Switchman Helpers in its Tondo
Exchange Office (TEO). After participating in several trainings and seminars,
petitioner, Benjamin, and Gonzales were promoted as Switchmen. Apostol,
on the other hand, was elevated to the position of Frameman.
Petitioner, Benjamin, Gonzales, and Apostol filed a Motion for
Reconsideration of the NLRC Decision but the same was denied for lack of
compelling reason in the Resolution dated 28 October 2002.
ISSUE:
Whether or not the petitioner’s complaint for illegal dismissal against
respondent is correct.
HELD:
Finally, it should be noted that the ruling of Labor Arbiter Lustria
sustaining the validity of petitioner’s dismissal from work by reason of a valid
redundancy program was affirmed by the NLRC and the Court of Appeals.
As heretofore discussed, their findings were predicated on the evidence on
records and prevailing jurisprudence. It is well-established that the findings of
the Labor Arbiter, the NLRC and the Court of Appeals, when in absolute
agreement, are accorded not only respect but even finality as long as they are
supported by substantial evidence. We find no compelling reason to depart
from this principle.
INTERNATIONAL CATHOLIC MIGRATION COMMISSION vs

NATIONAL LABOR RELATIONS COMMISSION and
BERNADETTE GALANG
FACTS:
Petitioner International Catholic Migration Commission (ICMC),
engaged the services of private respondent Bernadette Galang as a
probationary cultural orientation teacher.
Private respondent filed a complaint for illegal dismissal, unfair labor

practice and unpaid wages against petitioner with the then Ministry of Labor
and Employment, praying for reinstatement with backwages, exemplary and
moral damages.
Labor Arbiter Pelagio A. Carpio rendered his decision dismissing the

complaint for illegal dismissal as well as the complaint for moral and
exemplary damages but ordering the petitioner to pay private respondent the
sum of P6,000.00 as payment for the last three (3) months of the agreed
employment.
On appeal, the NLRC, by a majority vote of Commissioners Guillermo

C. Medina and Gabriel M. Gatchalian, sustained the decision of the Labor
Arbiter and thus dismissed both appeals for lack of merit.
Dissatisfied, petitioner filed the instant petition.
ISSUE:
Whether or not an employee who was terminated during the
probationary period of her employment is entitled to her salary for the
unexpired portion of her six-month probationary employment.
HELD:
There is justifiable basis for the reversal of public respondent's award
of salary for the unexpired three-month portion of private respondent's six-
month probationary employment in the light of its express finding that there
was no illegal dismissal. Records show that private respondent was found by
petitioner to be deficient in classroom management, teacher-student
relationship and teaching techniques. Failure to qualify as a regular employee
in accordance with the reasonable standards of the employer is a just cause for
terminating a probationary employee specifically recognized under Article
282 (now Article 281) of the Labor Code.
It was a grave abuse of discretion on the part of public respondent to

order petitioner to pay private respondent her salary for the unexpired three-
month portion of her six-month probationary employment when she was
validly terminated during her probationary employment. To sanction such
action would not only be unjust, but oppressive on the part of the employer.
Audion Electric Co., Inc. V. NLRC
Facts:
The complainant was employed by respondent Audion Electric
Company on June 30, 1976 as fabricator and continuously rendered service
assigned in different offices or projects as helper electrician, stockman and
timekeeper. He has rendered thirteen (13) years of continuous, loyal and
dedicated service with a clean record. On August 3, complainant was
surprised to receive a letter informing him that he will be considered
terminated after the turnover of materials, including respondents’ tools and
equipments not later than August 15, 1989.
Complainant claims that he was dismissed without justifiable cause and

due process and that his dismissal was done in bad faith which renders the
dismissal illegal. He claims that he is entitled to reinstatement with full
backwages.
Issue:
Whether private respondent is a regular or a project employee
Held:
Private respondent’s employment status was established by
the Certification of Employment dated April 10, 1989 issued by petitioner
which certified that private respondent is a bonafide employee of the
petitioner from June 30, 1976 up to the time the certification was issued on
April 10, 1989. This proves that private respondent was regularly and
continuously employed by petitioner in various job assignments from 1976 to
1989, for a total of 13 years. The alleged gap in employment service cited by
petitioner does not defeat private respondent’s regular status as he was rehired
for many more projects without interruption and performed functions which
are vital, necessary and indispensable to the usual business of petitioner.
Petitioner should have submitted or filed as many reports of termination

as there were construction projects actually finished, considering that private
respondent had been hired since 1976. The failure of petitioner to submit
reports of termination supports the claim of private respondent that he was
indeed a regular employee. This court has consistently held that failure of the
employer to file termination reports after every project completion with the
nearest public employment office is an indication that private respondent was
not and is not a project employee.
Biboso v. Victorias Milling Company, Inc.
Facts:
Herein individual complainants were employed by respondent as
academic teachers in respondent's school, the St. Mary Mazzarello School. On
or about April 14, 1973, complainants were notified by the School Directress
that they were not going to be rehired for the school year 1973-74. The
necessary report for such action was filed by respondent with the Department
of Labor on May 28, 1973, informing that complainants' services were thus
terminated after the business hours on June 30, 1973.
Issue:
Whether employees admitted temporarily enjoy security of tenure
Held:
There was the safeguard as to the duration of their employment being
respected. To that extent, their tenure was secure. The moment, however, the
period expired in accordance with contracts freely entered into, they could no
longer invoke the constitutional protection.
The allegation that the Company refused re-employment of

complainants simply because they joined the union VICSEA is negated by the
fact that in a much bigger school, the Don Bosco Technical Institute,
respondent has allowed the members of the faculty to join the CIVSEA
without any serious objection or reprisal. It is difficult to believe the
submission of individual petitioners that they were terminated from
employment because they joined petitioner union VICSEA. It would appear
that it was the other way around. Knowing that their contracts were about to
expire and that they would probably not be extended new ones, petitioners
sought membership in petitioner union VICSEA to render it more difficult for
respondent VICMICO to remove them from their teaching positions. This is
indicated by the fact that petitioners became members of petitioner union
VICSEA only in January, 1973. Before this date, individual petitioners were
already being closely observed to gauge their performance for purposes of
determining who shall be accorded permanent status. Thus, individual
petitioners knew that they would either be made permanent or will be dropped
from the faculty roster at the end of the school year 1972-73. So they joined
the union.
Maraguinot v. NLRC
Facts:
Maraguinot alleges that he was employed by Viva Films as part of the
filming crew. He was later designated as Assistant Electrician and then later
promoted to Electrician. Enero likewise claims that Viva hired him as a
member of the shooting crew. Maraguinot and Enero’s tasks consisted of
loading, unloading and arranging movie equipment in the shooting area. They
later asked the company that their salaries be adjusted in accordance with the
minimum wage law. In response, the company said that they would grant the
adjustment provided they signed a blank employment contract. When they
refused, they were forced to go on leave. Upon his return, the company refused
to take Enero back. As regards Maraguinot, he was dropped from the company
payroll, but was later returned. When again he refused to sign the blank
contract, his services were terminated. Maraguinot and Enero then sued for
illegal dismissal.
Issue:
Whether or not Maraguinot and Enero are regular employees of Viva
Held:
The Court held that these workers were regular employees of Viva and
that they were illegally dismissed. While Viva claims that the producers were
job contractors, Section 8 of Rule VIII, Book III of the Omnibus Rules
Implementing the Labor Code says to be considered a job contractor, such
associate producers must have tools, equipment, machinery, work premises
and other materials necessary to make motion picture. The associate producers
had none of these, and that in fact, the movie making equipment is owned by
Viva. Given that, these producers can be considered only as labor-only
contractors. As such is prohibited, the law considers the person or entity
engaged in the same a mere agent or intermediary of the direct employer. But
even given that, these producers cannot be considered as job contractors,
much less labor-only contractors as they did not supply, recruit nor hire the
workers.
The existence of an employer-employee relationship between

Maraguinot & Enero and Viva is further supported by the fact that the four
elements under 4-fold test are present.
As Maraguinot and Enero have already gained the status of regular

employees, their dismissal was unwarranted since the cause invoked for their
dismissal (completion of the project) is not one of the valid causes for
termination under Article 282 of the Labor Code.
Samson v. NLRC
Facts:
Petitioner Samson had been working for respondent Atlantic Gulf and
Pacific Co. Manila for approximately 28 years and his project-to-project
employment was renewed several times. His successive contracts of
employment required him to perform virtually the same kind of work
throughout his period of employment. Petitioner would be re-hired
immediately, some for a gap of one day to one week from the last project to
the succeeding one.
Issue:
Whether petitioner is a regular or project employee
Held:
Article 281 of the Labor Code pertinently prescribes that the provisions
of written agreement to the contrary notwithstanding and regardless of the oral
agreements of the parties, an employment shall be deemed to be regular where
the employee has been engaged to perform activities which are usually
necessary or desirable in the usual business or trade of the employer.
Where from the circumstances it appeared that periods have been

imposed to preclude the acquisition of tenurial security by the employee, they
should be struck down as contrary to public policy, morals, good customs, or
public order. There can be no escape from the conclusion that the employee
is a regular employee of the respondent.
Aguilar Corp. V. NLRC
Facts:
Private respondent Acedillo began working for petitioner in 1989 as a
helper-electrician. In 1992, he was dismissed from the company allegedly due
to lack of available projects and excess in the number of workers needed. He
decided to file a case for illegal dismissal before the NLRC after learning that
new workers were being hired by petitioner while his request to return to work
was being ignored. Petitioner maintained that its need for workers varied,
depending on contracts procured in the course of its business of contracting
refrigeration and other related works. It contended that its workers are hired
on a contractual or project basis, and their employment is deemed terminated
upon completion of the project for which they were hired. Finally, petitioner
argued that Acedillo was not a regular employee because his employment was
for a definite period and apparently made only to augment the regular work
force. The Labor Arbiter declared the dismissal to be illegal & the NLRC
affirmed the decision.
Issue:
Whether Acedillo was a regular employee which would make his
dismissal illegal
Held:
Yes, Acedillo is a regular employee. A project employee is one whose
"employment has been fixed for a specific projector undertaking, the
completion or termination of which has been determined at the time of the
engagement of the employee or where the work or services to be performed
is seasonal in nature and the employment is for the duration of the season."
The records reveal that petitioner did not specify the duration and scope of the
undertaking at the time Acedillo's services were contracted. Petitioner could
have easily presented an employment contract showing that he was engaged
only for a specific project, but it failed to do so. It is not even clear if Acedillo
ever signed an employment contract with petitioner. Neither is there any proof
that the duration of his assignment was made clear to him other than the self-
serving assertion of petitioner that the same can be inferred from the tasks he
was made to perform. What is clear is that Acedillo's work as a helper-
electrician was an activity "necessary or desirable in the usual business or
trade" of petitioner, since refrigeration requires considerable electrical work.
This necessity is further bolstered by the fact that petitioner would hire him
anew after the completion of each project, a practice which persisted
throughout the duration of his tenure.
De Ocampo v. NLRC
Facts:
On September 30, 1980, the services of 65 employees of private
respondent Makati Development Corporation were terminated on the ground
of the expiration of their contracts; that the said employees filed a complaint
for illegal dismissal against the MDC on October 1, 1980.
Issue:
Whether or not separation of the project employees was justified
Held:
The Court held that the project workers in the case at bar, who were
separated even before the completion of the project at the New Alabang
Village and not really for the reason that their contracts had expired, are
entitled to separation pay.
The record shows that although the contracts of the project workers had
indeed expired, the project itself was still on-going and so continued to require
the workers' services for its completion. 6 There is no showing that such
services were unsatisfactory to justify their termination. This is not even
alleged by the private respondent. One can therefore only wonder why, in
view of these circumstances, the contract workers were not retained to finish
the project they had begun and were still working on. This had been done in
past projects. This arrangement had consistently been followed before, which
accounts for the long years of service many of the workers had with the MDC.
Sandoval Shipyards Inc., v. NLRC
Facts:
Sandoval Shipyards, Inc. has been engaged in the building and repair
of vessels. It contends that each vessel is a separate project and that the
employment of the workers is terminated with the completion of each project.
The workers contend otherwise. They claim to be regular workers and
that the termination of one project does not mean the end of their employment
since they can be assigned to unfinished projects.
The National Labor Relations Commission affirmed the decision of the
Labor Arbiter ordering the reinstatement of the five complainants with
backwages from July 27, 1979.
Issue:
Whether the complainants were illegally dismissed
Held:
The Court said that private respondents were project employees whose
work was coterminous with the project for which they were hired. Project
employees, as distinguished from regular or non-project employees, are
mentioned in section 281 of the Labor Code as those "where the employment
has been fixed for a specific project or undertaking the completion or
termination of which has been determined at the time of the engagement of
the employee."
Thus, the NLRC resolution was and set aside. The complaints for illegal
layoff are dismissed.
Imbuido v. NLRC
Facts:
Petitioner was employed as a date encoder by private respondent. From
1988 until 1991, she entered into 13 employment contracts with private
respondent, each contract for a period of 3 months. In September 1991,
petitioner and 12 other employees allegedly agreed to the filing of a petition
for certification election of the rank and file employees of private respondent.
Subsequently, petition received a termination letter due to “low volume
of work.”
Petitioner filed a complaint for illegal dismissal. The Labor Arbiter

ruled in favor of the petitioner ruling that she was a regular employee. The
NLRC reversed the decision stating that although petitioner is a regular
employee, she is not entitled to security of tenure beyond the period for which
she was hired (only up to the time the specific project for which she was hired
was completed). Petitioner filed the present appeal.
Issue:
Whether or not the petitioner is a regular employee entitled to security
of tenure and was therefore unjustly dismissed
Held:
Even though petitioner is a project employee, as in the case of
Maraguinot, Jr. v. NLRC, the Court held that a project employee or member
of a work pool may acquire the status of a regular employee when the
following concur:
1. there is continuous rehiring of project employees even after the

cessation of a project;
2. the tasks performed by the alleged “project employee” are vital,

necessary and indispensable to the usual business and trade of the employer.
Private respondent was employed as a data encoder performing duties,

which are usually necessary or desirable in the usual business or trade of the
employer, continuously for a period of more than 3 years. Being a regular
employee, petitioner is entitled to security of tenure and could only be
dismissed for a just and authorized cause; low volume of work is not a valid
cause for dismissal under Art. 282 or 283. Having worked for more than 3
years, petitioner is also entitled to service incentive leave benefits from 1989
until her actual reinstatement since such is demandable after one year of
service, whether continuous or broken.
A.M. Oreta and Co., Inc. v. NLRC
Facts:
Private respondent Grulla was engaged by Engineering Construction
and Industrial Development Company (ENDECO) A.M. Oreta and Co., Inc.
as a carpenter in Jeddah, Saudi Arabia. The contract of employment entered
into on June 11, 1980 was for a period of 12 months.
On October 9, 1980, Grulla received a notice of termination of his

employment. He filed a complaint for illegal dismissal. Petitioner contends
however that he was validly dismissed as a probationary employee as his
dismissal was justified on the basis of unsatisfactory performance of his job
during the probationary period.
Issue:
Whether respondent Grulla was illegally terminated
Held:
Yes, for a perusal of the employment contract reveals that although the
period of employment of Grulla is for 12 months, the contract is renewable
subject to future agreement of the parties. It is clear from the employment
contract that Grulla was hired as a regular employee and not just a mere
probationary employee. Also, nowhere in the contract is there a stipulation
that the latter shall undergo a probationary period for 3 months before he can
qualify as a regular employee.
Moreover, Grulla was not in any manner informed of the charges
against him before he was outrightly dismissed. Neither was there any hearing
conducted by the company to give the respondent a chance to be heard
concerning the alleged unsatisfactory performance of his work.
Purefoods Corp. v. NLRC
Facts:
Petitioner hired private respondents Clavio and Catubay as drivers,
starting 1979 and 1976, respectively; Umali as utility man, starting 1978; Rey
as delivery man, starting 1973; and Del Rosario as checker, starting 1978.
Despite their specific appointments, there were times when respondents
Umali and Del Rosario were required by their superiors to perform the duties
of a dispatcher.
As early as March 18, 1981, immediately after an incident and without

prior investigation, only private respondents were indefinitely suspended for
alleged pilferage of all the employees involved from the packaging to the
delivery of the goods. Thereafter, their suspension was continued until their
dismissal without any notice to them or clearance from the then Ministry of
Labor and Employment.
Issue:
Whether the complainants were illegally dismissed
Held:
The Court is convinced that the decision and resolution complained of
should not be disturbed. The order of the Labor Arbiter to reinstate private
respondent Clavio and pay his backwages is affirmed. Likewise, the decision
of NLRC to reinstate the rest of the respondents and its resolution denying the
motion for reconsideration of the petitioner is affirmed.
There is no clear, positive and convincing evidence to point that private

respondents were guilty as charged. Respondent commission has noted
serious discrepancies in the affidavits of the witnesses presented by herein
petitioner.
Chua v. Court of Appeals
Facts:
Private respondents filed a petition with the SSC for SSS coverage and
contributions against petitioner Chua, owner of Prime Mover Construction
Development, claiming that they were all regular employees of the petitioner.
They alleged that petitioner dismissed all of them without justifiable grounds
and without notice to them and to the then Ministry of Labor and Employment.
They further alleged that petitioner did not report them to the SSS compulsory
coverage in flagrant violation of the Social Security Act.
On the other hand, petitioner claimed that respondents were project

employees who are not entitled to coverage under the Social Security Act.
Issue:
Whether or not respondents were regular employees
Held:
Yes, they were regular employees. Petitioner himself admitted that they
worked in his construction projects although their period of employment was
allegedly co-terminus with the phase of work.
The elements of the four- fold test in determining the existence of employer-
employee relationship are present.
C. E. CONSTRUCTION CORPORATION vs. ISAAC CIOCO, JR.,
FACTS:
Isaac Cioco, Jr., Rebie A. Mercado, Benito V. Galvadores, Cecilio
Solver, Carmelo Juanzo, Benjamin Baysa, and Rodrigo Napoles
(WORKERS) were hired by C.E. Construction Corporation (COMPANY), a
domestic corporation engaged in the construction business and managed by
its owner-president, Mr. Johnny Tan. They were hired as carpenters and
laborers in various construction projects from 1990 to 1999, the latest of
which was the GTI Tower in Makati. Prior to the start of every project, the
WORKERS signed individual employment contracts. Sometime in

May and June 1999, the WORKERS, along with sixty-six (66) others, were
terminated by the COMPANY on the ground of completion of the phases of
the GTI Tower project for which they had been hired. Alleging that they were
regular employees, the WORKERS filed complaints for illegal dismissal with
the Arbitration Branch of the NLRC. Claims for underpaid wages and unpaid
overtime pay, premium for holiday and rest days, service incentive leave pay,
night shift differential, and 13th month pay were likewise demanded.
The WORKERS contend that they are regular employees of the

COMPANY, hence, entitled to reinstatement and backwages from the time of
their illegal dismissal up to the date of their actual reinstatement.
ISSUE:
Whether the workers were regular or project employees of the
company.
HELD:
The fact that the WORKERS have been employed with the COMPANY
for several years on various projects, the longest being nine (9) years, did
not automatically make them regular employees considering that the
definition of regular employment in Article 280 of the Labor Code, makes
specific exception with respect to project employment. The re-hiring of
petitioners on a project-to-project basis did not confer upon them regular
employment status. The practice was dictated by the practical consideration
that experienced construction workers are more preferred. It did not change
their status as project employees.
HACIENDA BINO/HORTENCIA STARKE, INC vs. CANDIDO

CUENCA
FACTS:
Hacienda Bino is a 236-hectare sugar plantation located at Barangay
Orong, Kabankalan City, Negros Occidental, and represented in this case by
Hortencia L. Starke, owner and operator of the said hacienda.
The 76 individual respondents were part of the workforce of Hacienda

Bino consisting of 220 workers, performing various works, such as
cultivation, planting of cane points, fertilization, watering, weeding,
harvesting, and loading of harvested sugarcanes to cargo trucks.
On July 18, 1996, during the off-milling season, petitioner Starke

issued an Order or Notice. The respondents regarded such notice as a
termination of their employment. As a consequence, they filed a complaint for
illegal dismissal, wage differentials, 13th month pay, holiday pay and premium
pay for holiday, service incentive leave pay, and moral and exemplary
damages with the NLRC.
ISSUES:
Whether or not respondents are to be excluded from those classified as
regular employees.
HELD:
The primary standard for determining regular employment is the
reasonable connection between the particular activity performed by the
employee in relation to the usual trade or business of the employer. There is
no doubt that the respondents were performing work necessary and desirable
in the usual trade or business of an employer. Hence, they can properly be
classified as regular employees.
For respondents to be excluded from those classified as regular

employees, it is not enough that they perform work or services that are
seasonal in nature. They must have been employed only for the duration of
one season. While the records sufficiently show that the respondents’ work in
the hacienda was seasonal in nature, there was, however, no proof that they
were hired for the duration of one season only.
Mercado Sr. V. NLRC
Facts:
Petitioners were agricultural workers of the private respondent's sugar
land and were dismissed. They had worked in all agriculture phases in the
sugar land for several years. The respondent denied that petitioners were
regular employees alleging that their services were engaged through
'mandarols' or supply workers to do a particular phase of the agricultural work.
As a result, the petitioners filed a complaint for illegal dismissal. The

Labor Arbiter held that the petitioners were not regular employees and the
NLRC affirmed this ruling.
Issue:
Whether or not petitioners are regular and permanent farm workers
Held:
No, they are project/seasonal employees. A project employee is one
whose employment has been fixed for a specific project or undertaking, the
completion has been determined at the time of engagement, or where work or
service is seasonal in nature and employment is for the duration of the season.
As such, the termination of employment cannot be considered as illegal

dismissal. The petitioners are free to contract their services to work for other
farm owners.
A.M. Oreta and Co., Inc. v. NLRC

Facts:
Private respondent Grulla was engaged by Engineering Construction
and Industrial Development Company (ENDECO) A.M. Oreta and Co., Inc.
as a carpenter in Jeddah, Saudi Arabia. The contract of employment entered
into on June 11, 1980 was for a period of 12 months.
On October 9, 1980, Grulla received a notice of termination of his

employment. He filed a complaint for illegal dismissal. Petitioner contends
however that he was validly dismissed as a probationary employee as his
dismissal was justified on the basis of unsatisfactory performance of his job
during the probationary period.
Issue:
Whether respondent Grulla was illegally terminated
Held:
Yes, for a perusal of the employment contract reveals that although the
period of employment of Grulla is for 12 months, the contract is renewable
subject to future agreement of the parties. It is clear from the employment
contract that Grulla was hired as a regular employee and not just a mere
probationary employee. Also, nowhere in the contract is there a stipulation
that the latter shall undergo a probationary period for 3 months before he can
qualify as a regular employee.
Moreover, Grulla was not in any manner informed of the charges

against him before he was outrightly dismissed. Neither was there any hearing
conducted by the company to give the respondent a chance to be heard
concerning the alleged unsatisfactory performance of his work.
DANILO B. TABAS, vs. CALIFORNIA MANUFACTURING

COMPANY, INC,
FACTS:
Petitioners were, prior to their stint with California, employees of Livi
Manpower Services, Inc. (Livi), which subsequently assigned them to work
as promotional merchandisers for the former firm pursuant to a manpower
supply agreement. Among other things, the agreement provided that
California has no control or supervisions whatsoever over Livi's workers with
respect to how they accomplish their work or perform Californias obligation.
The Livi is an independent contractor and nothing herein contained shall be
construed as creating between California and Livi. The relationship of
principal-agent or employer-employee that it is hereby agreed that it is the
sole responsibility of Livi to comply with all existing as well as future laws,
rules and regulations pertinent to employment of labor and that California is
free and harmless from any liability arising from such laws or from any
accident that may befall workers and employees of Livi while in the
performance of their duties for California.
It was further expressly stipulated that the assignment of workers to

California shall be on a seasonal and contractual basis that cost of living
allowance and the 10 legal holidays will be charged directly to California at
cost and that payroll for the preceding week shall be delivered by Livi at
California's premises.
The petitioners now allege that they had become regular California
employees and demand, as a consequence whereof, similar benefits. They
likewise claim that pending further proceedings below, they were notified by
California that they would not be rehired. As a result, they filed an amended
complaint charging California with illegal dismissal.
ISSUES:
Whether or not the petitioners are California's or Livi's employees.
HELD:
There is no doubt that in the case at bar, Livi performs "manpower
services", meaning to say, it contracts out labor in favor of clients. We hold
that it is one notwithstanding its vehement claims to the contrary, and
notwithstanding the provision of the contract that it is "an independent
contractor." The nature of one's business is not determined by self-serving
appellations one attaches thereto but by the tests provided by statute and
prevailing case law.
A temporary or casual employee, under Article 218 of the Labor Code,

becomes regular after service of one year, unless he has been contracted for a
specific project. And we cannot say that merchandising is a specific project
for the obvious reason that it is an activity related to the day-to-day operations
of California.
Phil. Bank of Communications v. NLRC
Facts:
Petitioner and CESI entered into a letter agreement saying that
CESI will provide temporary services to the petitioner. Attached to
the letter was a list of messengers assigned to work, including
respondent Orpiada. Orpiada rendered service within the premises of
the bank. In October 1976, petitioner requested CESI to withdraw
Orpiada’s assignment because his services were no longer needed.
Thus, Orpiada filed a complaint against petitioner for illegal
dismissal and failure to pay is 13 th month pay.
Issue:
Whether an employer- employee relationship existed between
the bank and respondent
Held:
Yes. Orpiada is not previously selected by the bank but was assigned to
work by CESI. His selection was however subject to the acceptance of the
bank. With respect to the payment of his wages, the bank remitted to CESI his
daily rate and CESI pays the latter his wages. He was also listed in the payroll
of CESI with SSS deduction. As to the power of dismissal, the bank
requested CESI to withdraw Orpiada’s assignment, which resulted to
the latter’s termination. With regard to the power of control, Orpiada
performed his functions within the bank’s premises and not in CESA.
Payment of wages and power of dismissal exist between CESI and Orpiada.
However, selection and control exist between this employee and the
bank. Thus, it is necessary to determine the relationship between the
bank and CESI, whether the latter is a job (independent) contactor or a labor-
only contracting.
In the present case, the undertaking of CESI in favor of the bank was
not the performance of a specific job, but to produce its client, the bank
with a certain number of persons to work as messengers. Thus,
Orpiada utilized the premises and office equipment of the bank and not of
CESI. He worked in the bank for a period of 16 months. Under
the Labor Code, any employee who has rendered at least 1 yearof service,
whether continuous or not, shall be considered as a regular
employee. Therefore, CESI was only engaged in a labor-only
contracting with petitioner and Orpiada. As a result, petitioner is liable
to Opiada as if he had been directly employed by the bank.
St. Theresa’s School v. NLRC
Facts:
Petitioner Roxas is the president of St. Theresa’s School of Novaliches
Foundation. She hired private respondent, Esther Reyes, on a contract basis,
for the period from June 1, 1991 to March 31, 1992. However, private
respondent commenced work on May 2, 1991. During the said period of
employment, respondent became ill. She went on a leave of absence from
February 17 to 21 and from February 24 to 28, 1992, such leave of absence
having been duly approved by petitioner Roxas. On March 2, 1992, private
respondent reported for work, but she only stayed in her place of work from
6:48 to 9:38 a.m. Thereafter, she never returned.
Petitioners theorize that the private respondent abandoned her
work. On the other hand, the latter maintains that she was replaced.
Petitioners sent private respondent a letter by registered mail, informing her
that her contract, due to expire on March 31, 1992, would not be renewed.
Issue:
Whether respondent was lawfully dismissed and whether she is entitled
to backwages
Held:
Article 280 of the Labor Code does not prohibit an employment
contract with a fixed period provided it is entered into by the parties, without
any force, duress or improper pressure being brought to bear upon the
employee and absent any other circumstance vitiating consent. It does not
necessarily follow that where the duties of the employee consist of activities
usually necessary or desirable in the usual business of the employer, the
parties are forbidden from agreeing on a period of time for the performance
of such activities. There is thus nothing essentially contradictory between a
definite period of employment and the nature of the employee’s duties.
It goes without saying that contracts of employment govern the

relationship of the parties. In this case, private respondent’s contract provided
for a fixed term of 9 months. Such stipulation, not being contrary to law,
morals, good customs, public order and public policy, is valid, binding and
must be respected.
The dismissal has been adjudged valid and lawful, the challenged award
of backwages is decidedly improper and contrary to law and jurisprudence.
Servidad v. NLRC
Facts:
Petitioner Servidad was employed by respondent INNODATA as a
Data Control Clerk. After working for 6 months, he was made to sign a three-
month probationary employment and later, an extended three-month
probationary employment.
On July 7, 1994, the petitioner was given an overall rating of 100% and
98% in the work evaluations conducted by the company. In another
evaluation, petitioner received a rating of 98.5% given by the private
respondent.
On May 9, 1995, petitioner was dismissed from the service on the
ground of alleged termination of contract of employment.
Issue:
Whether the contract between the employer and employee was for a
fixed term and whether the dismissal was valid
Held:
The contract was not for a fixed term and the dismissal is invalid.
In their contract which provided 2 periods, the private respondent did not
specify the criteria for the termination or retention of the services of
petitioner. Such a wide leeway for the determination of the tenure of an
employee during a one year period of employment is violative of the right of
the employee against unwarranted dismissal.
If the contract was really for a fixed term, the private respondent should
not have been given the discretion to dismiss the petitioner during the one year
period of employment for reasons other than the just and authorized causes
under the Labor Code. Settled is the rule that an employer can terminate the
services of an employee only for valid and just causes which must be shown
by clear and convincing evidence.
The language of the contract in dispute is truly a double-bladed scheme

to block the acquisition of the employee of tenurial security. Thereunder,
private respondent has two options. It can terminate the employee by reason
of expiration of contract, or it may use “failure to meet work standards” as the
ground for the employee’s dismissal. In either case, the tenor of the contract
jeopardizes the right of the worker to security of tenure guaranteed by the
Constitution.
Brent School v. Zamora
Facts:
Private respondent Alegre was engaged as athletic director by petitioner
Brent School, Inc. The contract fixed a specific term of 5 years. Subsequent
subsidiary agreements reiterated the same terms and conditions, including the
expiry date, as those contained in the original contract.
On April 20,1976, Alegre was given a copy of the report filed by Brent
School with the Department of Labor advising of the termination of his
services effective on July 16, 1976. The stated ground for the termination was
"completion of contract, expiration of the definite period of employment."
Although protesting the announced termination stating that his services were
necessary and desirable in the usual business of his employer, and his
employment lasted for 5 years, therefore he had acquired the status of regular
employee, Alegre accepted the amount given and signed a receipt therefor
containing the phrase, "in full payment of services full payment of contract."
Issue:
` Whether the contract of employment fixed for a definite term is valid
and renders respondent’s termination of employment valid.
Held:
Respondent Alegre's contract of employment with Brent School having
lawfully terminated with and by reason of the expiration of the agreed term of
period thereof, he is declared not entitled to reinstatement.
When the employment contract was signed between Brent School and
Alegre, it was perfectly legitimate for them to include in it a stipulation fixing
the duration thereof Stipulations for a term were explicitly recognized as valid
by this Court.
The status of legitimacy continued to be enjoyed by fixed-period

employment contracts under the Labor Code (PD 442), which went into effect
on November 1, 1974. The Code contained explicit references to fixed period
employment, or employment with a fixed or definite period.
Romares v. NLRC
Facts:
Complainant alleged that he was hired by respondent in its
Maintenance/Projects/Engineering Department; that he has rendered a total
service of more than 1 year and by operation of law, has become a regular
employee of respondent.
He added that he performed tasks and functions which were necessary

and desirable in the operation of respondent’s business which include
painting, maintenance, repair and other related jobs and that he was never
reprimanded nor subjected to any disciplinary action during his engagement
with the respondent.
Respondent on the other hand maintained that complainant was a

former contractual employee and as such his employment was covered by
contracts; that he was hired as mason and was engaged only for a specific
project under such department; and that his services as mason was not
continuous, in fact, he was employed with International Pharmaceuticals, Inc.
in Opol, Misamis Oriental.
Issue:
Whether the petitioner is a regular employee which would make his
dismissal illegal
Held:
The petitioner is a regular employee of the company.Facts show that
petitioner’s work with PILMICO as a mason was definitely necessary and
desirable to its business. PILMICO cannot claim that petitioner’s work as a
mason was entirely irrelevant to its line of business in the production of flour,
yeast, feeds and other flour products.
It is noteworthy that during each rehiring, the summation of which

exceeded 1 year, petitioner was assigned to PILMICO’s
Maintenance/Projects/Engineering Department performing the same kind of
maintenance work. Such a continuing need for the services of petitioner is
sufficient evidence of the necessity and indispensability of his services to
PILMICO’s business or trade. The fact that petitioner was employed with
another company in the interregnum from is of no moment.
Article 280 was emplaced in our statute books to prevent the

circumvention of the employee’s right to be secure in his tenure by
indiscriminately and completely ruling out all written and oral agreements
inconsistent with the concept of regular employment defined therein.
Medernilla v. Phil. Veterans Bank
Facts:
Petitioners were employees of the Philippine Veterans Bank (PVB).
Their services were terminated as a result of the liquidation of PVB pursuant
to the order of the Monetary Board of the Central Bank.
On the same day of their termination, they were rehired through PVB’s
Bank Liquidator. However, all of them were required to sign contracts which
provided that the employment shall be strictly on a temporary basis.
On January 18, 1991, petitioners received a uniform notice of dismissal

effective a month from the date of receipt, to reduce costs and expenses in the
liquidation of closed banks in order to protect the interests of the depositors,
creditors and stockholders.
Issue:
Whether the employment contract entered into by the complainants and
the Liquidator of PVB was for a fixed-period and whether the termination of
their employment is illegal
Held:
The Court has repeatedly upheld the validity of fixed-term
employment. The employment contract entered into by the parties herein
appears to have observed the two guidelines by which fixed contracts of
employment can be said NOT to circumvent security of tenure. It was
knowingly and voluntarily agreed upon by the parties, without any force,
duress or improper pressure being brought to bear upon the employee and
absent any other circumstances vitiating his consent. And it satisfactorily
appears that the employer and employee dealt with each other on more or less
equal terms with no moral dominance whatever being exercised by the former
on the latter.
On the issue of the validity of dismissal, the Court said the burden is on
the employer to prove that there was a valid ground for dismissal. Mere
allegation of reduction of costs without any proof to substantiate the same
cannot be given credence by the Court. As the respondents failed to rebut
petitioners’ evidence, the irresistible conclusion is that the dismissal in
question was illegal.
However, since petitioners’ reinstatement is now considered

impractical because the new Philippine Veterans Bank has been rehabilitated,
the Court limits the relief to be granted to the petitioners to the unpaid wages
during the remaining period of their employment contract.
Manila Electric Co. v. Quisumbing
Facts:
The court directed the parties to execute a CBA incorporating the terms
among which are the following modifications: Wages: PhP 1,900 for 1995-
1996; Retroactivity: December 28, 1996-Dec. 1999, etc. Dissatisfied, some
members of the union filed a motion for intervention/reconsideration.
Petitioner warns that if the wage increase of Php2,000.00 per month as ordered
is allowed, it would pass the cost covering such increase to the consumers
through an increased rate of electricity. On the retroactivity of the CBA
arbitral award, the parties reckon the period as when retroaction shall
commence.
Issue:
Whether or not retroactivity of arbitral awards shall commence at such
time as granted by the Secretary
Held:
In St. Luke’s Medical vs. Torres, a deadlock developed during CBA
negotiations between management unions. The Secretary assumed
jurisdiction and ordered the retroaction of the CBA to the date of expiration
of the previous CBA. The Court ratiocinated thus: In the absence of a specific
provision of law prohibiting retroactivity of the effectivity of arbitral awards
issued by the Secretary pursuant to article 263(g) of the Labor Code, public
respondent is deemed vested with the plenary and discretionary powers to
In general, a CBA negotiated within six months after the expiration of the
existing CBA retroacts to the day immediately following such date and if
agreed thereafter, the effectivity depends on the agreement of the parties. On
the other hand, the law is silent as to the retroactivity of a CBA arbitral award
or that granted not by virtue of the mutual agreement of the parties but by
intervention of the government. In the absence of a CBA, the Secretary’s
determination of the date of retroactivity as part of his discretionary powers
over arbitral awards shall control.
Wherefore, the arbitral award shall retroact from December 1, 1995 to
November 30, 1997; and the award of wage is increased from Php1,900 to
Php2,000.
COCA COLA BOTTLERS PHILS., INC. vs. NATIONAL LABOR

FACTS:
On 7 April 1986 COCA COLA entered into a contract of janitorial
services with Bacolod Janitorial Services (BJS). Every year thereafter a
service contract was entered into between the parties under similar terms and
conditions until about May 1994.
On 26 October 1989 COCA COLA hired private respondent Ramon

Canonicato as a casual employee and assigned him to the bottling crew as a
substitute for absent employees. In April 1990 COCA COLA terminated
Canonicato's casual employment. Later that year COCA COLA availed of
Canonicato's services, this time as a painter in contractual projects which
lasted from fifteen (15) to thirty (30) days.
On 1 April 1991 Canonicato was hired as a janitor by BJS which

assigned him to COCA COLA considering his familiarity with its premises.
On 5 and 7 March 1992 Canonicato started painting the facilities of COCA
COLA and continued doing so several months thereafter or so for a few days
every time until 6 to 25 June 1993.
Goaded by information that COCA COLA employed previous BJS

employees who filed a complaint against the company for regularization
pursuant to a compromise agreement, Canonicato submitted a similar
complaint against COCA COLA to the Labor Arbiter.
ISSUE:
Whether or not there exists a employer-employee relationship between
petitioner and coca cola or between BJS.
HELD:
NLRC have recognized BJS as the employer of Canonicato and not
COCA COLA. It upheld, the finding of the Labor Arbiter that BJS was truly
a legitimate job-contractor and could by itself hire its own employees. The
Commission could not have reached any other legitimate conclusion
considering that BJS satisfied all the requirements of a job-contractor under
the law, namely, (a) the ability to carry on an independent business and
undertake the contract work on its own account under its own responsibility
according to its manner and method, free from the control and direction of its
principal or client in all matters connected with the performance of the work
except as to the results thereof; and, (b) the substantial capital or investment
in the form of tools, equipment, machinery, work premises, and other
materials which are necessary in the conduct of its business.
Lakas v. Burlingame
Facts:
Petitioner sought to represent all rank-and-file promo employees of
respondent. It alleged that said group of employees is not represented by a
union. So, they filed a petition for certification election before the Department
of Labor and Employment.
Respondent, however, opposed said petition on the ground that there

exists no employer-employee relation between the parties. It further claimed
that the employees sought to be represented by petitioner are not their
employees but the employees of F. Garil Manpower Services, a duly licensed
local employment agency.
Issue:
Whether or not there is employer-employee relationship between
respondent and the employees sought to be represented by the petitioner
Held:
The Supreme Court stressed the "four-fold test" in determining the
existence of employer-employee relationship in this petition. These elements
are: 1. the selection and engagement of the employee 2. the payment of wages
3. the power of dismissal and 4. the employer's power to control the
employee's conduct.
The most important element is the last element. That is, the employer
controls the conduct of an employee not only as to the result of the work to be
done, but also as to the means and methods to accomplish it. It bears stressing
that the facts of the case clearly indicate the existence of employer-employee
relationship. The involvement of F. Garil, the employment agency, is limited
only to the recruitment aspect. Furthermore, despite of the presence of a
stipulation agreed into by the employment agency and herein respondent to
the extent that the rank-and-file employees are considered as the employees
of the former, the Supreme Court held that said contractual stipulation cannot
override factual circumstances firmly establishing the legal existence of an
employer-employee relationship.
INDUSTRIAL TIMBER CORPORATION vs.NLRC
FACTS:
Industrial Timber Corporation (ITC) is a corporation registered under
Philippine laws and is engaged in the business of manufacturing and
processing veneer and plywood products. It used to operate a veneer
processing plant known as the Butuan Logs Plant and a veneer and plywood
processing plant known as the Stanply Plant. Both plants had also two (2)
distinct bargaining units represented by separate labor unions and had separate
collective bargaining agreements with their respective principals. ITC
Butuan Logs Workers Union-WATU (Union) represented the rank and file
employees of the Butuan Logs Plant.
Sometime in 1989, ITC decided to permanently stop and close its

veneer production at its Butuan Logs Plant “due to impending heavy financial
losses resulting from high production costs, erratic supply of raw materials
and depressed prices and market conditions for its wood products.”
Accordingly, on November 9, 1989, ITC served a written notice to all its
employees in the said plant and to the Butuan District Office of the
Department of Labor and Employment (DOLE) stating that effective
December 10, 1989 or thirty (30) days thereafter, it would cease operations at
said plant.
ISSUE:
Whether or not petitioner ITC is guilty of illegal shutdown of its Butuan
Logs Plant.
HELD:
Under Article 283 of the Labor Code ,clearly provides that the
employer may terminate the employment of his employees to prevent losses.
Closure or cessation of operations for economic reasons is, therefore,
recognized as a valid exercise of management prerogative. Provided, that
there is compliance with the requirements mandated by law to effectuate
valid termination of employment on account of closure.
The records bear out that petitioner had sufficiently complied with the
aforecited requirements.
PHILIPPINE AIRLINES, INC, vs. NLRC, Respondent.
FACTS:
Private respondent was employed as flight surgeon at petitioner
company. He was assigned at the PAL Medical Clinic at Nichols and was on
duty from 4:00 in the afternoon until 12:00 midnight.
On February 17, 1994, at around 7:00 in the evening, private respondent

left the clinic to have his dinner at his residence, which was about five-minute
drive away. A few minutes later, the clinic received an emergency call from
the PAL Cargo Services. One of its employees, Mr. Manuel Acosta, had
suffered a heart attack. The nurse on duty, Mr. Merlino Eusebio, called
private respondent at home to inform him of the emergency. The patient
arrived at the clinic at 7:50 in the evening and Mr. Eusebio immediately
rushed him to the hospital. When private respondent reached the clinic at
around 7:51 in the evening, Mr. Eusebio had already left with the patient. Mr.
Acosta died the following day.
Finding private respondent’s explanation unacceptable, the

management charged private respondent with abandonment of post while on
duty. He was given ten days to submit a written answer to the administrative
charge. After evaluating the charge as well as the answer of private
respondent, petitioner company decided to suspend private respondent for
three months. Private respondent filed a complaint for illegal suspension
against petitioner.
ISSUE:
Whether or not the eight- hour period includes one-hour meal period
HELD:
Rest periods or coffee breaks running from five (5) to twenty (20)
minutes shall be considered as compensable working time.
Thus, the eight-hour work period does not include the meal break.
Nowhere in the law may it be inferred that employees must take their meals
within the company premises. Employees are not prohibited from going out
of the premises as long as they return to their posts on time. Private
respondent’s act, therefore, of going home to take his dinner does not
constitute abandonment.
Eparwa Security, Inc. v. Liceo de Cagayan University
Facts:
Eparwa and Liceo de Cagayan University (LDCU), through their
representatives, entered into a Contract for Security Services.
Thereafter, 11 security guards whom Eparwa assigned to LDCU filed a
complaint before the NLRC. The complaint was filed against both Eparwa
and LDCU for underpayment of salary, legal holiday pay, 13th month pay,
rest day, service incentive leave, night shift differential, overtime pay, and
payment for attorney’s fees.
To protect its interest LDCU made a cross-claim and prayed that

Eparwa should reimburse LDCU for any payment to the security guards.
The Labor Arbiter found the claim of the Security guards meritorious and
ordered the same to be paid by Eparwa and LDCU.
Issue:
Whether or not LDCU alone is ultimately liable to the security guards
for the wage differentials and premium for holiday and rest day pay
Held:
No, adopting the ruling in Eagle Security Agency vs. NLRC which has
the same facts in this case, the SC ruled that the joint and several liability of
the contractor and the principal is mandated by the Labor Code.
The contractor is made liable by virtue of his status as direct employer. The
principal, on the other hand, is made the indirect employer of the contractor’s
employees for purposes of paying the employees their wages should the
contractor be unable to pay them. This joint and several liability facilitates, if
not guarantees, payment of the workers’ performance of any work, task, job
or project, thus giving the workers ample protection as mandated by the 1987
Constitution.
LDCU’s ultimate liability comes into play because of the expiration of

the Contract for Security Services. Eparwa is already precluded from asking
LDCU for an adjustment in the contract price because of the expiration of the
contract, but Eparwa’s liability to the security guards remains because of their
employer-employee relationship. In lieu of an adjustment in the contract
price, Eparwa may claim reimbursement from LDCU for any payment it may
make to the security guards. However, LDCU cannot claim any
reimbursement from Eparwa for any payment it may make to the security
guards.
WENIFREDO FARROL vs.The HONORABLE COURT OF APPEALS
FACTS:
Petitioner Wenifredo Farrol was employed as station cashier at
respondent RCPI’s Cotabato City station. On June 18, 1993, respondent
RCPI’s district manager in Cotabato City informed their main office that
"Peragram funds” from said branch were used for the payment of retirement
benefits of five employees. On October 1, 1993, petitioner verified as correct
RCPI’s Field Auditor’s report that there was a shortage of P50,985.37 in their
branch’s Peragram, Petty and General Cash Funds. Consequently, petitioner
was required by the Field Auditor to explain the cash shortage within 24 hours
from notice. The next day, petitioner paid to RCPI P25,000.00 of the cash
shortage.
On October 16, 1993, RCPI required petitioner to explain why he

should not be dismissed from employment. Two days thereafter, petitioner
wrote a letter to the Field Auditor stating that the missing funds were used for
the payment of the retirement benefits earlier referred to by the branch
manager and that he had already paid P25,000.00 to RCPI. After making two
more payments of the cash shortage to RCPI, petitioner was informed by the
district manager that he is being placed under preventive suspension.
Thereafter, he again paid two more sums on different dates to RCPI leaving a
balance of P6,995.37 of the shortage.
ISSUE:
Whether or not the petitioner’s dismissal is valid.
HELD:
The employer must comply with the twin requirements of two notices
and hearing. The first notice is that which apprises the employee of the
particular acts or omissions for which his dismissal is sought, and after
affording the employee an opportunity to be heard, a subsequent notice
informing the latter of the employer’s decision to dismiss him from work.
The Court thus holds that the dismissal imposed on petitioner is unduly harsh
and grossly disproportionate to the infraction which led to the termination of
his services. A lighter penalty would have been more just, if not humane.
VH Manufacturing Inc. v. NLRC
Facts:
Private respondent Gamido was employed in the petitioner company as
a quality control inspector with the principal duty of inspecting LPG Cylinders
for any possible defects. His service with the company was abruptly
interrupted when he was served a termination of his employment. His
dismissal stemmed from an incident wherein the Company’s President
allegedly caught him sleeping on the job.
On that same day, he was asked through a written notice to explain

within 24 hours why no disciplinary action should be taken against him for
violation of Company Rule 15-B which provides for the penalty of separation
for sleeping during working hours. Without delay, Gamido gave his reply.
However, he was still terminated so he filed a complaint for illegal dismissal
praying for reinstatement. The Labor Arbiter declared his dismissal valid. The
NLRC reversed the decision.
Issue:
Whether or not Gamido’s dismissal is too harsh a penalty for his
violation of a Company Rule
Held:
According to Gamido, he was not sleeping but was merely idle, waiting
for the next cylinder to be checked. In termination disputes, the burden of
proof is always on the employer to prove that the dismissal was for a just and
valid cause. What is at stake is not only the job but the regular income there
from which is the means of livelihood of his family. A thorough review of the
record discloses that petitioner’s claim was not substantiated by any
convincing evidence other that the bare allegation of the officer.
VH’s reliance on the authorities it cited that sleeping on the job is a

valid ground for dismissal is misplaced. The authorities cited involved
security guards whose duty necessitates that they be awake and watchful at all
times.
In the case at bar, the dismissal meted out on respondent for alleged
sleeping on the job appears to be too harsh a penalty, considering that he was
held liable for the first time after 9 years of unblemished service, for an alleged
offense. Neither was it shown that his alleged negligence, if any, was gross
and habitual. Thus, reinstatement is just and proper.
St. Michael’s Institute v. Santos
Facts:
Petitioner is a learning institute in Bacoor, Cavite with Fr. Victorino as
Director and Blanco as the Principal and respondents Santos, Magcamit and
Rosarda were regular classroom teachers. On Aug. 10, 1993, there held a
public rally organized and participated by, among others, the respondents
aimed at calling the attention of the school administration to certain
grievances relative to substandard school facilities and the economic demands
of teachers and other employees. In response to the memoranda issued by
Blanco, Magcamit and Rosarda denied all the accusations attributed to them
while Santos justified her actions as having been done on behalf of her co-
teachers with the parents' blessings.
After finding that respondents had led and actively participated in the
rally through an investigation, petitioners dismissed their employment that
caused the former to file a complaint against petitioners for illegal dismissal.
Issue:
Whether or not the conduct of the respondents warranted dismissal
from their employment
Held:
Under the attendant factual antecedents, the dismissal meted out on the
respondents for dereliction of duty for one school day and denouncing school
authority, appears to be too harsh a penalty. It must be noted that the
respondents are being held liable for a first time offense and, in the case of
respondent Santos, despite long years of unblemished service. Even when an
employee is found to have transgressed the employer's rules, in the actual
imposition of penalties upon the erring employee, due consideration must still
be given to his length of service and the number of violations committed
during his employment. Where a penalty less punitive would suffice,
whatever missteps may have been committed by the employee ought not to be
visited with a consequence so severe such as dismissal from employment.
Moreover, the facts, as further established on appeal in the NLRC, paint out a
picture that the respondents were singled out by the petitioners apparently for
being officers of the teachers' union which they formed, despite the fact that
several other teachers also joined the August 10, 1993 rally.
VICENTE C. ETCUBAN, JR. vs. SULPICIO LINES, INC.
FACTS:
The petitioner was employed by the respondent on January 30, 1978
until his dismissal on June 10, 1994 for loss of trust and confidence. At the
time of his dismissal, the petitioner was the Chief Purser of the M/V Surigao
Princess receiving a monthly salary of P5,000.00.
The stakes are high in a position imbued with trust, and for petitioner
Vicente C. Etcuban, Jr., the loss of trust in him by his employer cost him his
job after 16 years of service.
ISSUE:
Whether or not the guidelines on imposition of dismissal of Etcuban
were complied
HELD:
The guidelines were complied in the imposition of dismissal. The
degree of proof required in labor cases is not as stringent as in other types of
cases. It must be noted, however, that recent decisions of this Court have
distinguished the treatment of managerial employees from that of rank-and-
file personnel, insofar as the application of the doctrine of loss of trust and
confidence is concerned.
Thus, with respect to rank-and-file personnel, loss of trust and

confidence as ground for valid dismissal requires proof of involvement in the
alleged events in question, and that mere uncorroborated assertions and
accusations by the employer will not be sufficient. But as regards a managerial
employee, the mere existence of a basis for believing that such employee has
breached the trust of his employer would suffice for his dismissal.
Hence, in the case of managerial employees, proof beyond reasonable

doubt is not required, it being sufficient that there is some basis for such loss
of confidence, such as when the employer has reasonable ground to believe
that the employee concerned is responsible for the purported misconduct, and
the nature of his participation therein renders him unworthy of the trust and
confidence demanded by his position.
CISELL A. KIAMCO vs. NATIONAL LABOR RELATIONS

COMMISSION
FACTS:
On 1 July 1992 private respondent PHILIPPINE NATIONAL OIL
COMPANY (PNOC) hired petitioner Cisell Kiamco as a project employee in
its Geothermal Agro-Industrial Plant Project in Valencia, Negros
Oriental. The Contract of Employment stipulated among others that Kiamco
was being hired by the company as a technician for a period of five (5) months
from 1 July 1992 to 30 November 1992, or up to the completion of the project,
whichever would come first, at a monthly salary of P3,500.00.
On 28 October 1993 Kiamco received a Memorandum placing him

under preventive suspension from 1 November 1993 to 30 November 1993
pending further investigation. No investigation however was ever
conducted. Private respondents contended that an investigation was not
necessary since Kiamco had ceased to be an employee ipso facto upon the
expiration of his employment contract on 30 November 1993.
ISSUES:
1) Whether or not petitioner Kiamco is entitled to reinstatement and
full backwages regardless of his employment status?
2) Whether or not Kiamco was illegally dismissed?
HELD:
The argument of private respondents that reinstatement and payment of
back wages could not be made since Kiamco was not a regular employee is
apparently misplaced. The normal consequences of an illegal dismissal are
the reinstatement of the aggrieved employee and the grant of back
wages. These rights of an employee do not depend on the status of his
employment prior to his dismissal but rather to the legality and validity of his
termination. The fact that an employee is not a regular employee does not
mean that he can be dismissed any time, even illegally, by his employer.
It cannot be gainsaid that the dismissal of an employee should be for any of
the just and authorized causes enumerated in the Labor Code. However,
petitioner’s case no proof or evidence was ever presented by private
respondents to justify his termination. On the contrary, they relied solely on
the expiration of the employment contract to legitimize his termination,
instead of the administrative infractions he allegedly committed, thus
abandoning altogether any valid cause private respondents might have under
the Labor Code that could justify his dismissal.
In De la Cruz v. NLRC we held - In termination cases, the burden of

proving just and valid cause for dismissing an employee from his employment
rests upon the employer, and the latter’s failure to do so results in finding that
the dismissal is unjustified. Petitioner Cisell A. Kiamco is immediately
reinstated to his former position without loss of seniority rights and privileges
with full back wages from the date of his dismissal until his actual
reinstatement.
DANDY V. QUIJANO vs. MERCURY DRUG CORPORATION and

NATIONAL LABOR RELATIONS COMMISSION,
FACTS:
Petitioner DANDY V. QUIJANO was a warehouseman at the central
warehouse of respondent MERCURY DRUG CORPORATION in Libis,
Quezon City, since 1983. During his 8-year stay in the company, he received
high performance ratings and a corresponding 15% increase in salary per
annum. Through the years, the company has also recognized and commended
him for his dedication to his work.[2] He has actively articulated the
employees' concerns and, since 1990, has written to the management about
the malpractices committed by some officers of a "five-six" loan system in
their workplace operated by some of its officers.[3] He incurred the ire of
respondent's manager Mr. Antonio Altavano who operated the usurious
transactions.
In April 1991, respondent charged petitioner with four (4) violations of
company policies, all allegedly committed on March 19, 1991. It started at
about 11:00 a.m. when petitioner allegedly left his workplace without
permission. He was charged with loafing and abandonment of work.
ISSUE:
Whether or not the petitioner was dismissed from service without just
cause?
HELD:
Reinstatement is the remedy that most effectively restores the right of
an employment before he was unjustly deprived of his job. In giving an
illegally dismissed employee the right to reinstatement, the law [1] recognizes
the fact that continued employment gives to a worker, especially to a lowly or
menial laborer, an assurance of continuity in his source of income which a
grant of separation pay could not provide. In the case at bar, we give primacy
to the employee's right to reinstatement rather than the employers claim that
due to "strained relationship," his illegally dismissed employee should just be
given separation pay.
REV. FR. EMMANUEL LABAJO vs. NATIONAL LABOR

FACTS:
Private respondents alleged that their dismissal by petitioner High
School was without justifiable cause and in violation of their rights to due
process and security of tenure.
ISSUES:
1) Whether or not the private respondents were illegally dismissed
by petitioners?
2) Whether or not reinstatement of all six (6) private respondents is
proper in this case?
HELD:
In view of all the foregoing, we hold that none of the six (6) private
respondents in this case, at the time of their separation, had achieved
permanent status in their employment as teachers at the San Andres High
School. As probationary and contractual employees, private respondents
enjoyed security of tenure, but only to a limited extent — i.e., they remained
secure in their employment during the period of time their respective contracts
of employment remained in effect. That temporary security of tenure,
however, ended the moment their employment contracts expired on 31 March
1985 and petitioners declined to renew the same for the next succeeding
school year. Consequently, as petitioners were not under obligation to renew
those contracts of employment, the separation of private respondents in this
case cannot be said to have been without justifiable cause, much less illegal.
Since the six (6) private respondents were not illegally dismissed, the
twin remedies of reinstatement and backwages are not available to them.
JOSE M. MAGLUTAC vs. NLRC
FACTS:
Jose M. Maglutac, petitioner in G.R. No. 78345 (hereinafter referred to
as complainant) was employed by Commart (Phils.), Inc. (hereinafter referred
to as Commart) sometime in February, 1980 and rose to become the Manager
of its Energy Equipment Sales. On October 3, 1984, he received a notice of
termination signed by Joaquin S. Cenzon, Vice-President-General Manager
and Corporate Secretary of CMS International, a corporation controlled by
Commart. The notice of termination partly reads:
You are hereby notified and advised that the Board of Directors of this
Corporation, acting on the unanimous resolution, have decided that your
continued employment in this company, will not be in the best interest of the
corporation.
Thereafter, Jose Maglutac filed a complaint for illegal dismissal against

Commart and Jesus T. Maglutac, President and Chairman of the Board of
Directors of Commart.
ISSUES:
1) Whether or not petitioner Maglutac is entitled to reinstatement?
2) Whether or not private respondent Maglutac cannot be held
personally liable being the president of the corporation?
HELD:
The relationship had been so strained that to order the reinstatement of
the complainant would not be wise. Where the relationship of employer to
employee is so strained and ruptured as to preclude a harmonious working
relationship should reinstatement of the employee be decreed, the latter should
be afforded the right to separation pay where the employer does not have to
endure the continued services of the employee in whom it has lost confidence
(Esmalin v. NLRC, G.R. 67880, 15 September 1989, Bautista v. Enciong,
G.R. No. L-52824, 16 March 1988, Asiaworld Publishing House Inc. v. Hon.
Ople, et al., G.R. No. 56398, July 23, 1987).
PETROPHIL CORPORATION vs. NLRC

FACTS:
Private respondent, Anselmo B. Encarnacion, had been working as a
casual employee of various job contractors in Petrophil's premises since 1963
when the firm was still under the ownership and management of Esso
Standard Philippines. On December 21, 1973, Esso Standard Philippines was
sold to Petrophil Corporation. At that time, Anselmo B. Encarnacion was
working at the bulk plant as an employee of one Juanito Campos who had a
job contract with Esso Standard Philippines. The said job contract was
continued by Petrophil Corporation so respondent Encarnacion remained
working at the bulk plant. In March 1976, respondent Gersher Engineering
Works entered into a service contract with Petrophil and thereafter placed
respondent Encarnacion in its payroll.
Respondent Encarnacion refused to be reassigned to Caltex unless he

was made to occupy the same position of warehouseman as in Petrophil
Corporation and since the position available at Caltex was that of equipment
maintainer, respondent Encarnacion refused to be transferred. Instead he filed
a complaint for illegal dismissal against respondent Gersher and in the
alternative, against petitioner Petrophil Corporation, before the Labor
Relations Division of the then Department of Labor.
ISSUE:
Whether or not the respondent was not dismissed but was only demoted
and transferred to Caltex Phil. Inc.?
HELD:
Considering the foregoing, reinstatement of respondent Encarnacion
and payment of his money claims should be made by respondent Gersher
Engineering Works, his employer which has evidently accepted the decision
of the Labor Arbiter by not appealing therefrom Petitioner Petrophil
Corporation is absolved from any and all liability.
PHILIPPINE AEOLUS AUTOMOTIVE UNITED CORPORATION

and/or FRANCIS CHUA vs. NATIONAL LABOR RELATIONS
COMMISSION and ROSALINDA C. CORTEZ
FACTS:
Petitioner Philippine Aeolus Automotive United Corporation
(PAAUC) is a corporation duly organized and existing under Philippine laws,
petitioner Francis Chua is its President while private respondent Rosalinda C.
Cortez was a company nurse of petitioner-corporation until her termination
on 7 November 1994.
A memorandum addressed to private respondent Rosalinda C. Cortez

requiring her to explain within forty-eight (48) hours why no disciplinary
action should be taken against her (a) for throwing a stapler at Plant Manager
William Chua, her superior, and uttering invectives against him on 2 August
1994; (b) for losing the amount of P1,488.00 entrusted to her by Plant
Manager Chua to be given to Mr. Fang of the CLMC Department on 23
August 1994; and, (c) for asking a co-employee to punch-in her time card thus
making it appear that she was in the office in the morning of 6 September
1994 when in fact she was not.
ISSUE:
Whether or not petitioner (PAAUC) is not guilty of illegal dismissal
HELD:
No. Petitioner is guilty of illegal dismissal.
The Supreme Court, in a litany of decisions on serious misconduct

warranting dismissal of an employee, has ruled that for misconduct or
improper behavior to be a just cause for dismissal (a) it must be serious; (b)
must relate to the performance of the employee’s duties; and, (c) must show
that the employee has become unfit to continue working for the employer. The
act of private respondent in throwing a stapler and uttering abusive language
upon the person of the plant manager may be considered, from a lay man's
perspective, as a serious misconduct. However, in order to consider it a serious
misconduct that would justify dismissal under the law, it must have been done
in relation to the performance of her duties as would show her to be unfit to
continue working for her employer. The acts complained of, under the
circumstances they were done, did not in any way pertain to her duties as a
nurse. Her employment identification card discloses the nature of her
employment as a nurse and no other. Also, the memorandum informing her
that she was being preventively suspended pending investigation of her case
was addressed to her as a nurse.
ACESITE CORPORATION, HOLIDAY INN, JOHANN

ANGERBAUER and PHIL KENNEDY vs. NATIONAL LABOR
RELATIONS COMMISSION and LEO A. GONZALES
FACTS:
Leo A. Gonzales was hired on October 18, 1993 as Chief of Security of
Manila Pavillion Hotel. On January 1, 1995, Acesite Corporation (Acesite)
took over the operations of Manila Pavillion and renamed it Holiday Inn
Manila (the hotel). Acesite retained Gonzales as Chief of Security of the
hotel.
On April 23, 1998, Gonzales filed an application for emergency leave

for 10 days commencing on April 30 up to May 13, 1998. The application
was not, however, approved. By Acesite’s claim, he received a telegram
informing him of the disapproval and asking him to report back for work on
April 30, 1998.
It appears that on May 7, 1998, Angerbauer issued the following Notice

of Termination through an inter-office memo.
ISSUE:
Whether or not Gonzales was dismissed for just cause and was not
denied of due process
HELD:
The dismissal is without just cause, thus, Gonzales was deprived of due
process. Employees are still entitled to the procedural requirements of notice
and hearing despite provisions in their code of discipline purportedly giving
them the right to immediately terminate their services. Employees cannot
bargain away this right notwithstanding their acquiescence to the employer’s
rules.
In order that an employer may dismiss an employee on the ground of

willful disobedience, there must be concurrence of at least two (2) requisites:
the employee’s assailed conduct must have been willful or intentional, the
willingness being characterized by a wrongful and perverse attitude; and that
the order violated must have been reasonable, lawful, made known to the
employee and must pertain to the duties which he had been engaged to
discharge.
The present case does not show the presence of the first requisite. As
private respondent Gonzales’ failure to comply with petitioners’ orders were
not characterized by a perverse attitude. At most he can only be suspended
from service for assuming that his leaves of absence would be approved by
management. The penalty of dismissal is too harsh considering that private
respondent Gonzales has been with the company for almost five (5) years and
has rendered unblemished service until the period in controversy.
ARIEL A. TRES REYES vs. MAXIM’S TEA HOUSE and JOCELYN

POON
FACTS:
Respondent Maxim’s Tea House had employed Ariel Tres Reyes as a
driver since October 1995. He was assigned to its M.H. del Pilar Street,
Ermita, Manila branch. His working hours were from 5:00 P.M. to 3:00 A.M.,
and among his duties was to fetch and bring to their respective homes the
employees of Maxim’s after restaurant closed for the day.
On November 19, 1997, Maxim’s terminated petitioner for cause

because of the vehicular accident he met and causing 7 passenger to a physical
injuries.
Feeling that the vehicular accident was neither a just nor a valid cause
for the severance of his employment, petitioner filed a complaint for illegal
dismissal.
ISSUE:
Whether or not petitioner’s dismissal from employment valid and legal.
HELD:
Under the Labor Code, gross negligence is a valid ground for an
employer to terminate an employee. Gross negligence is negligence
characterized by want of even slight care, acting or omitting to act in a
situation where there is a duty to act, not inadvertently but willfully and
intentionally with a conscious indifference to consequences insofar as other
persons may be affected.
In this case, however, there is no substantial basis to support a finding

that petitioner committed gross negligence.
There being no clear showing that petitioner was culpable for gross
negligence, petitioner’s dismissal is illegal. It was error for the Court of
Appeals to reverse and set aside the decision of the Third Division of the
NLRC.
NORMA MABEZA vs. NATIONAL LABOR RELATIONS

COMMISSION
FACTS:
Responding to the allegations made in support of petitioner's complaint
for illegal dismissal, private respondent Peter Ng alleged before Labor Arbiter
that petitioner "surreptitiously left (her job) without notice to the
management" and that she actually abandoned her work.
ISSUE:
Whether or not petitioner-Mabeza abandoned her job, thus, constitutes
just cause to validly effect her dismissal?
HELD:
It is settled that in termination cases the employer bears the burden of
proof to show that the dismissal is for just cause, the failure of which would
mean that the dismissal is not justified and the employee is entitled to
reinstatement.
In the case at bar, the private respondent initially claimed that petitioner
abandoned her job when she failed to return to work on May 8, 1991. From
the evidence on record, it is crystal clear that the circumstances upon which
private respondent anchored his claim that petitioner "abandoned" her job
were not enough to constitute just cause to sanction the termination of her
services under Article 283 of the Labor Code. For abandonment to arise, there
must be concurrence of two things: 1) lack of intention to work; and 2) the
presence of overt acts signifying the employee's intention not to work.
In the instant case, respondent does not dispute the fact that petitioner
tried to file a leave of absence when she learned that the hotel management
was displeased with her refusal to attest to the affidavit. The fact that she
made this attempt clearly indicates not an intention to abandon but an intention
to return to work after the period of her leave of absence, had it been granted,
shall have expired.
Furthermore, while absence from work for a prolonged period may

suggest abandonment in certain instances, mere absence of one or two days
would not be enough to sustain such a claim. The overt act (absence) ought
to unerringly point to the fact that the employee has no intention to return to
work, which is patently not the case here. In fact, several days after she had
been advised to take an informal leave, petitioner tried to resume working
with the hotel, to no avail. It was only after she had been repeatedly rebuffed
that she filed a case for illegal dismissal. These acts militate against the
private respondent's claim that petitioner abandoned her job. The petitioner
was illegally dismissed.
UNIWIDE SALES WAREHOUSE CLUB vs. NATIONAL LABOR

FACTS:
Amalia P. Kawada started her employment with Uniwide sometime in
1981 as a saleslady. Over the years, private respondent worked herself within
Uniwide's corporate ladder until she attained the rank of Full Assistant Store
Manager with a monthly compensation of P13,000.00 in 1995.
As a Full Assistant Store Manager, private respondent's primary

function was to manage and oversee the operation of the Fashion and Personal
Care, GSR Toys, and Home Furnishing Departments of Uniwide, to ensure its
continuous profitability as well as to see to it that the established company
policies and procedures were properly complied with and implemented in her
departments.
Sometime in 1998, Uniwide received reports from the other employees
regarding some problems in the departments managed by the private
respondent signifying unsatisfactory performance on the latter's part.
On August 3, 1998, private respondent filed a case for illegal dismissal before
the Labor Arbiter.
ISSUE:
Whether or not private respondent was constructively dismissed.
HELD:
After a thorough examination of the conflicting positions of the parties,
the Court finds the records bereft of evidence to substantiate the conclusions
of the NLRC and the CA that private respondent was constructively dismissed
from employment.
Case law defines constructive dismissal as a cessation of work because

continued employment is rendered impossible, unreasonable or unlikely;
when there is a demotion in rank or diminution in pay or both; or when a clear
discrimination, insensibility, or disdain by an employer becomes unbearable
to the employee.
VICENTE C. ETCUBAN, JR. vs. SULPICIO LINES, INC
FACTS:
The petitioner was employed by the respondent on January 30, 1978
until his dismissal on June 10, 1994 for loss of trust and confidence. At the
time of his dismissal, the petitioner was the Chief Purser of the M/V Surigao
Princess receiving a monthly salary of P5,000.00.
The stakes are high in a position imbued with trust, and for petitioner
Vicente C. Etcuban, Jr., the loss of trust in him by his employer cost him his
job after 16 years of service.
ISSUE:
Whether or not the guidelines on imposition of dismissal of Etcuban
were complied
HELD:
The guidelines were complied in the imposition of dismissal. The
degree of proof required in labor cases is not as stringent as in other types of
cases. It must be noted, however, that recent decisions of this Court have
distinguished the treatment of managerial employees from that of rank-and-
file personnel, insofar as the application of the doctrine of loss of trust and
confidence is concerned.
Thus, with respect to rank-and-file personnel, loss of trust and

confidence as ground for valid dismissal requires proof of involvement in the
alleged events in question, and that mere uncorroborated assertions and
accusations by the employer will not be sufficient. But as regards a managerial
employee, the mere existence of a basis for believing that such employee has
breached the trust of his employer would suffice for his dismissal.
Hence, in the case of managerial employees, proof beyond reasonable

doubt is not required, it being sufficient that there is some basis for such loss
of confidence, such as when the employer has reasonable ground to believe
that the employee concerned is responsible for the purported misconduct, and
the nature of his participation therein renders him unworthy of the trust and
confidence demanded by his position.
JOSE V. SALVADOR vs. PHILIPPINE MINING SERVICE

CORPORATION
FACTS:
Respondent Philippine Mining Service Corporation was established in
1980 by Japanese investors Kawatetsu Mining Co., Ltd. and Kawasaki Steel
Corporation to develop dolomite deposits in Cebu. Respondent exports
quality dolomite ore for use in the manufacture of steel, glass and fertilizer.
Petitioner Jose V. Salvador filed a complaint for illegal dismissal with

the Labor Arbiter. According to petitioner, on September 29, 1997, he
reported for work at the plant at 7:00 a.m. and was on duty as shift boss until
12:00 midnight. At about 9:00 to 9:30 a.m., he went to the stockyard for
inspection. While checking the stockpiles, he saw that some lumpy ore mixed
with and spilt over the fine ore near the divider of the two stockpiles. Further
examination revealed that there was a cluster of lumpy ore buried at the base
of the fine ore stockpile. Petitioner immediately took action to clean the
contamination. He left the stockyard and went to the plant across the highway
to secure his dust foe. When he returned to the stockyard, he saw that his
private cargo truck has arrived. His truck was hired by his business partner,
Ondo Alcantara, to haul dolomite spillage which their business purchased
from respondent. Petitioner claimed that, in order to save time, he personally
operated respondent’s payloader, scooped the contaminated fine ore in the
stockpile and loaded it on his private cargo truck. It was while he was hauling
the contaminated fine ore that Sawa saw him.
ISSUE:
Whether or not the charge of pilferage against petitioner was supported
by substantial evidence to warrant his dismissal from the service.
HELD:
Yes. Preliminarily, the Labor Code provides that an employer may
terminate the services of an employee for just cause and this must be
supported by substantial evidence. The settled rule in administrative and
quasi-judicial proceedings is that proof beyond reasonable doubt is not
required in determining the legality of an employer’s dismissal of an
employee, and not even a preponderance of evidence is necessary as
substantial evidence is considered sufficient. Substantial evidence is more
than a mere scintilla of evidence or relevant evidence as a reasonable mind
might accept as adequate to support a conclusion, even if other minds, equally
reasonable, might conceivably opine otherwise. Thus, substantial evidence is
the least demanding in the hierarchy of evidence.
FUJITSU COMPUTER PRODUCTS CORPORATION vs. COURT OF

APPEALS, VICTOR DE GUZMAN and ANTHONY P. ALVAREZ
FACTS:
Respondent Victor de Guzman began working for FCPP on September
21, 1997 as Facilities Section Manager. Respondent Allan Alvarez, on the
other hand, was employed as a Senior Engineer on April 21, 1998.
The private respondent- Mr. Alvarez was imputed of malicious acts

undermining the result of the ongoing administrative investigation involving
Mr. De Guzman, and therefore, constitutes serious misconduct. Petitioner
contends that his actions do not speak well of a ranking Senior Engineer in
the Facilities Section especially in consideration of the fact that he has several
employees reporting to him and should in fact, serve as their role model.
In view of the foregoing ineluctable facts, he was terminated from the

service.
ISSUE:
Whether or not Mr. Alvarez herein petitioner was afforded of due
process?
HELD:
No. Mr. Alvarez was deprived of due process. It is settled that to
constitute a valid dismissal from employment, two requisites must concur: (a)
the dismissal must be for any of the causes provided for in Article 282 of the
Labor Code; and (b) the employee must be afforded an opportunity to be heard
and defend himself. This means that an employer can terminate the services
of an employee for just and valid causes, which must be supported by clear
and convincing evidence. It also means that, procedurally, the employee must
be given notice, with adequate opportunity to be heard, before he is notified
of his actual dismissal for cause.
To be valid ground for dismissal, loss of trust and confidence must be

based on a willful breach of trust and founded on clearly established facts. A
breach is willful if it is done intentionally, knowingly and purposely, without
justifiable excuse, as distinguished from an act done carelessly, thoughtlessly,
heedlessly, or inadvertently. It must rest on substantial grounds and not on
the employer’s arbitrariness, whims, caprices or suspicion; otherwise, the
employee would eternally remain at the mercy of the employer. Loss of
confidence must not be indiscriminately used as a shield by the employer
against a claim that the dismissal of an employee was arbitrary. And, in order
to constitute a just cause for dismissal, the act complained of must be work-
related and shows that the employee concerned is unfit to continue working
for the employer.
COCA-COLA BOTTLERS (PHILS.), INC. vs. NATIONAL LABOR

FACTS:
On 13 January 1987, private respondent union filed against petitioner a
complaint for illegal dismissal of twenty-one (21) of its members.
An amended complaint dated 2 May 1988 and several original

complaints were subsequently filed by private respondent union alleging that
other union members were similarly dismissed by petitioner, making a total
of ninety-eight (98) workers allegedly illegally dismissed and ten (10)
workers allegedly illegally transferred by petitioner. The complaints also
asserted claims by members of private respondent union for 13th month pay,
service incentive leave pay, interest and attorney's fees, and included a prayer
for reinstatement and backwages. Complainants also claimed that their
dismissal was tainted with unfair labor practice.
ISSUES:
Whether or not complaining workers had been deprived of due process
not having been given an opportunity to prove that the termination of the
services of the same had been effected for a valid and legal cause?
HELD:
`Yes, they were deprived of due process. The illegal dismissal cases
were thus in effect brought and resumed by the members of private respondent
union as employees of petitioner-company. The burden of proving that the
termination of the services of the members of respondent union was for a valid
or authorized cause, lay upon petitioner employer. That burden was not
discharged by petitioner which, for reasons satisfactory to itself, chose not to
submit any memorandum or other pleadings before the Labor Arbiter after
this Court had resolved the issue of the worker's employment status. Thus, the
Labor Arbiter and the NLRC were correct in holding that the members of
private respondent union had been illegally dismissed by petitioner-company.
Petitioner's assertion of denial of due process was properly rejected as entirely
bereft of merit.
Ordinarily, the closing of a warehouse facility and the termination of

the services of employees there assigned is a matter that is left to the
determination of the employer in the good faith exercise of its management
prerogatives. The applicable law in such a case is Article 283 of the Labor
Code which permits "closure or cessation of operation of an establishment or
undertaking not due to serious business losses or financial reverses," which,
in our reading, includes both the complete cessation of operations and the
cessation of only part of a company's activities. In such a case, however, the
company is required to notify both the employees concerned and the
Department of Labor and Employment ("DOLE") at least one (1) month
before the intended date of closure. The notice to the DOLE is, of course,
intended to enable the proper authorities to determine after hearing whether
such closure is being done in good faith, i.e., for bonafide business reasons,
or whether, to the contrary, the closure is being resorted to as a means of
evading compliance with the just obligations of the employer to the employees
affected.
NEECO II vs. NATIONAL LABOR RELATIONS COMMISSION
FACTS:
Petitioner Nueva Ecija Electric Cooperative (NEECO) II employed
private respondent Eduardo M. Cairlan in 1978 as driver and was assigned at
petitioner’s Sub-Office at Quezon, Nueva Ecija.
On 15 January 1996, Danilo dela Cruz, petitioner’s General Manager,

terminated private respondent’s services on ground of abandonment.
ISSUES:
1) Whether or not private respondent’s dismissal was due to a just
cause and with due process?
2) Whether or not formal hearing is at all times required effecting a
due process dismissal?
HELD:
Abandonment is the deliberate and unjustified refusal of an employee
to resume his employment; it is a form of neglect of duty; hence, a just cause
for termination of employment by the employer under Article 282 of the Labor
Code, which enumerates the just causes for termination by the employer.
Jurisprudential declarations are rich to the effect that the essence of due
process is simply an opportunity to be heard, or as applied to administrative
proceedings, an opportunity to explain one's side. A formal or trial type
hearing is not at all times and in all instances essential to due process, the
requirements of which are satisfied where the parties are afforded fair and
reasonable opportunity to explain their side of the controversy.
Under the said Rule, the Labor Arbiter is given the latitude to determine
the necessity for a formal hearing or investigation, once the position papers
and other documentary evidence of the parties have been submitted before
him. The parties may ask for a hearing but such hearing is not a matter of right
of the parties. The Labor Arbiter, in the exercise of his discretion, may deny
such request and proceed to decide the case on the basis of the position papers
and other documents brought before him without resorting to technical rules
of evidence as observed in regular courts of justice. The requirement of due
process in labor cases before a Labor Arbiter is satisfied when the parties are
given the opportunity to submit their position papers to which they are
supposed to attach all the supporting documents or documentary evidence that
would prove their respective claims, in the event the Labor Arbiter determines
that no formal hearing would be conducted or that such hearing was not
necessary.
FLOREN HOTEL and/or LIGAYA CHU, DELY LIM and JOSE CHUA
LIM vs. NATIONAL LABOR RELATIONS COMMISSION
FACTS:
At the time of their termination, private respondents Roderick A.
Calimlim, Ronald T. Rico and Jun A. Abalos were working in the hotel as
room boys, private respondent Lito F. Bautista as front desk man, and private
respondent Gloria B. Lopez as waitress.
ISSUE:
Whether or not the private respondents were illegally dismissed?
HELD:
Petitioners claimed that all five private respondents were guilty of
abandoning their jobs. Thus, it was incumbent upon petitioners to show that
the two requirements for a valid dismissal on the ground of abandonment
existed in this case. Specifically, petitioners needed to present, for each
private respondent, evidence not only of the failure to report for work or that
absence was without valid or justifiable reasons, but also of some overt act
showing the private respondent’s loss of interest to continue working in his or
her job.
None of the private respondents in this case had any intention to severe
their working relationship. Just days after they were dismissed, private
respondents Calimlim, Rico, Bautista, Abalos and Lopez filed complaints to
protest their dismissals. The well-established rule is that an employee who
takes steps to protest his layoff cannot be said to have abandoned his work.
The private respondents were ILLEGALLY dismissed.
HACIENDA DAPDAP vs. NATIONAL LABOR RELATIONS

COMMISSION (NLRC)
FACTS:
Sometime on March 1992 nine (9) workers of Hda. Dapdap I, a sugar farm in
Victorias, Negros Occidental, filed a complaint for illegal dismissal against its owner
Magdalena Fermin with the NLRC alleging that they had been working in the
farm since 1977 but were unjustly terminated, without notice and without
any valid ground, on 27 January 1992.
The only reason for their dismissal was the irrefusal to return the 6-hectare
lot given to them for cultivation under an "Amicable Settlement" dated 30 September
1986 in connection with an illegal dismissal case previously filed against the
management of Hda. Dapdap I by its workers. In addition, complainants
charged Magdalena Fermin with unfair labor practice for trying to bust the
National Federation of Sugar Workers Food and General Trades (NFSW-FGT) Union
which forged the 1986 "Amicable Settlement". On 7 September 1992 eight (8) of the
original complainants withdrew from the complaint and returned to work on the ground
that their misunderstanding with management was already settled. Pedro
Barrientos Jr. was left as the sole complainant who amended the complaint on 30
March 1993 by impleading Lumbia Agricultural and Development Corporation
(LADCOR), the real owner of Hda. Dapdap I, as co-respondent with its President
Magdalena Fermin. LADCOR denied that complainant was terminated on 27 January
1992; on the contrary, it alleged that complainant voluntarily abandoned his
work after 1March 1992 to transfer to the adjacent farm of a certain Mr. Ramos. In
addition, LADCOR alleged that it had a personality separate and distinct from
its president, Magdalena Fermin, hence the latter could not be held personally liable
for the alleged illegal dismissal. Labor Arbiter Merlin D. Deloria ruled in favor of
complainant. LADCOR appealed to the National Labor Relations Commission
(NLRC). The NLRCaffirmed the Labor Arbiter's Decision in toto.
ISSUE:
Whether or not the respondent abandoned his job and he was not
illegally dismissed?
HELD:
No. the respondent did not abandoned his job, thus, he was illegally dismissed.
The NLRC correctly applied the consistent ruling in labor cases that a charge of
abandonment is totally inconsistent with the immediate filing of a complaint
for illegal dismissal. It is indeed inconceivable that an employee like herein respondent
who has been working at Hda. Dapdap I since 1977andcultivating and substantial
portion of a 6-hectare lot therein for himself would just abandon his work in
1992 for no apparent reason. As quoted by the Court in Judric Canning
Corporation v. Inciong, "To get a job is difficult; to run from it is fool hardy.”
BRENDO D. MERIN vs. NATIONAL LABOR RELATIONS

COMMISSION
FACTS:
Sometime in 1999, petitioner was contracted by Great Southern
Maritime Services Corporation (GSM) for and in behalf of its foreign
principal, IMC Shipping, Co., Pte. Ltd., as an ordinary seaman on board the
vessel MT “Selandang Permata” for ten (10) months. Barely three (3) months
after he boarded the vessel, petitioner was repatriated by the master of the
vessel. Petitioner allegedly refused to receive his termination letter. After his
arrival in Manila, he inquired from GSM the reason for his dismissal, but
allegedly none was given to him by his local employer.
It appears that petitioner had committed several infractions while on

board the vessel. At one time, he allegedly failed to report for work after he
drank too much alcohol at a party. He apologized for the incident, and even
submitted a letter of apology to the master of the vessel. In another instance,
the master of the vessel found petitioner sleeping in the crew’s smoke room.
When roused from his slumber, the master of the vessel noticed that he had
bloodshot eyes and was in fact intoxicated.
ISSUE:
Whether or not Mr. Merin was dismissed without observing just cause
to effect due process of dismissal?
HELD:
The totality of infractions or the number of violations committed during
the period of employment shall be considered in determining the penalty to be
imposed upon an erring employee. The offenses committed by petitioner
should not be taken singly and separately.
Fitness for continued employment cannot be compartmentalized into

tight little cubicles of aspects of character, conduct and ability separate and
independent of each other. While it may be true that petitioner was penalized
for his previous infractions, this does not and should not mean that his
employment record would be wiped clean of his infractions.
After all, the record of an employee is a relevant consideration in

determining the penalty that should be meted out since an employee’s past
misconduct and present behavior must be taken together in determining the
proper imposable penalty.
Despite the sanctions imposed upon petitioner, he continued to commit

misconduct and exhibit undesirable behavior on board. Indeed, the employer
cannot be compelled to retain a misbehaving employee, or one who is guilty
of acts inimical to its interests. It has the right to dismiss such an employee if
only as a measure of self-protection. Court finds just cause in petitioner’s
termination.
ELENA F. UICHICO, SAMUEL FLORO, VICTORIA F. BASILIOvs.

NATIONAL LABOR RELATIONS COMMISSION.
FACTS:
Private respondents were employed by Crispa, Inc. for many years in
the latter's garments factory located in Pasig Boulevard, Pasig City. Sometime
in September, 1991, private respondents' services were terminated on the
ground of retrenchment due to alleged serious business losses suffered by
Crispa, Inc. in the years immediately preceding 1990. Thereafter, respondent
employees, on November, 1991, filed before the NLRC, National Capital
Region, Manila, three (3) separate complaints for illegal dismissal and
diminution of compensation against Crispa, Inc., Valeriano Floro , and the
petitioners. Valeriano Floro was a major stockholder, incorporator and
Director of Crispa, Inc., while the petitioners were high ranking officers and
directors of the company. Said complaints were consolidated in order to
expedite the proceedings. The case was assigned to Labor Arbiter Raul
Aquino.
ISSUE:
Whether or not the dismissal is legal.
HELD:
Under Section 9 (b) Book VI, Rule III of Omnibus Rules implementing
the Labor Code, it provides: Section 9. (b) Where the termination of
employment is due to retrenchment to prevent losses and in case of closure or
cessation of operations of establishment or undertaking not due to serious
business losses or financial reverses, or where the employee suffers from a
disease and his continued employment is prohibited by law or is prejudicial to
his health or the health of his co-employees, the employee shall be entitled to
termination pay equivalent to at least one-half month pay for every year of
service, a fraction of at least six months being considered as one whole year.
In labor cases, particularly, corporate directors and officers are
solidarily liable with the corporation for the termination of employment of
corporate employees done with malice or in bad faith. In this case, it is
undisputed that petitioners have a direct hand in the illegal dismissal of
respondent employees. They were the ones, who as high-ranking officers and
directors of Crispa, Inc., signed the Board Resolution retrenching the private
respondents on the feigned ground of serious business losses that had no basis
apart from an unsigned and unaudited Profit and Loss Statement which, to
repeat, had no evidentiary value whatsoever. This is indicative of bad faith
on the part of petitioners for which they can be held jointly and severally liable
with Crispa, Inc. for all the money claims of the illegally terminated
respondent employees in this case.
ORLANDO M. ESCAREAL vs. NATIONAL LABOR RELATIONS

COMMISSION
FACTS:
Petitioner was hired by the PRC for the position of Pollution Control
Manager, the employment was made permanent effective on 16 March 1978.
The contract of employment provides, inter alia, that his “retirement date will
be the day you reach your 60th birthday, but there is provision for voluntary
retirement when you reach your 50th birthday. On 15 June 1988, Jesus P.
Javelona, PRC’s Engineering Department Manager and petitioner’s
immediate superior, formally informed the petitioner that the position of
“Safety and Pollution Control Manager will be declared redundant effective
at the close of work hours on 15th July 1988.Petitioner was also notified that
the functions and duties of the position to be declared redundant will be
absorbed and integrated with the duties of the Industrial Engineering
Manager; as a result thereof, the petitioner “will receive full separation
benefits provided under the PRC Retirement Plan and additional redundancy
payment under the scheme applying to employees who are 50 years old and
above and whose jobs have been declared redundant by Management.
ISSUE:
Whether or not the dismissal of the petitioner is with authorized cause
and valid?
HELD:
No, the petitioner was dismissed without authorized cause. In Wiltshire
File Co., Inc. vs. NLRC,[29] this Court held that redundancy, for purposes of
the Labor Code, exists where the services of an employee are in excess of
what is reasonably demanded by the actual requirements of the enterprise; a
position is redundant when it is superfluous, and superfluity of a position or
positions may be the outcome of a number of factors, such as the over hiring
of workers, a decreased volume of business or the dropping of a particular
product line or service activity previously manufactured or undertaken by the
enterprise. Redundancy in an employer’s personnel force, however, does not
necessarily or even ordinarily refer to duplication of work. That no other
person was holding the same position which the dismissed employee held
prior to the termination of his services does not show that his position had not
become redundant.
Private respondent PRC had no valid and acceptable basis to declare

the position of Pollution Control and Safety Manager redundant as the same
may not be considered as superfluous; by the express mandate of the
provisions as above cited, said positions are required by law. Thus, it cannot
be gainsaid that the services of the petitioner are in excess of what is
reasonably required by the enterprise. Otherwise, PRC would not have
allowed ten (10) long years to pass before opening its eyes to that fact; neither
would it have increased the petitioner’s salary to P23,100.00 a month effective
1 April 1988.
ISMAEL V. SANTOS, vs. PEPSI COLA PRODUCTS PHILS., INC
FACTS:
Private respondent Pepsi Cola Products Phils., Inc. (PEPSI) is a
domestic corporation engaged in the production, distribution and sale of
beverages. At the time of their termination, petitioners Ismael V. Santos and
Alfredo G. Arce were employed by PEPSI as Complimentary Distribution
Specialists (CDS) with a monthly salary of P7,500.00 and P10,000.00,
respectively, while Hilario M. Pastrana was employed as Route Manager with
a monthly salary of P7,500.00.
In a letter dated 26 December 1994, PEPSI informed its employees that

due to poor performance of its Metro Manila Sales Operations it would
restructure and streamline certain physical and sales distribution systems to
improve its warehousing efficiency. Certain positions, including that of
petitioners, were declared redundant and abolished. Consequently, employees
with affected positions were terminated.
ISSUE:
Whether there was failure to comply with the requirements of the Rules
in filing their petition for certiorari
HELD:
The requirement of setting forth the three (3) dates in a petition for
certiorari under Rule 65 is for the purpose of determining its timeliness. Such
a petition is required to be filed not later than sixty (60) days from notice of
the judgment, order or Resolution sought to be assailed. Therefore, that the
petition for certiorari was filed forty-one (41) days from receipt of the denial
of the motion for reconsideration is hardly relevant. The Court of Appeals
was not in any position to determine when this period commenced to run and
whether the motion for reconsideration itself was filed on time since the
material dates were not stated. It should not be assumed that in no event would
the motion be filed later than fifteen (15) days. Technical rules of procedure
are not designed to frustrate the ends of justice. These are provided to effect
the proper and orderly disposition of cases and thus effectively prevent the
clogging of court dockets. Utter disregard of the Rules cannot justly be
rationalized by harking on the policy of liberal construction.
ASIAN ALCOHOL CORPORATION vs. NATIONAL LABOR

FACTS:
In September, 1991, the Parsons family, who originally owned the
controlling stocks in Asian Alcohol, was driven by mounting business losses
to sell their majority rights to prior Holdings, Inc. (hereinafter referred to as
Prior Holdings). The next month, Prior Holdings took over its management
and operation.
To thwart further losses, Prior Holdings implemented a

reorganizational plan and other cost-saving measures. Some one hundred
seventeen (117) employees out of a total workforce of three hundred sixty
(360) were separated. Seventy two (72) of them occupied redundant positions
that were abolished.
ISSUE:
Whether or not the dismissal of complainants on ground of
redundancy/retrenchment was perfectly valid or legal?
HELD:
Yes. The complaints for illegal dismissal filed by private respondents
against Asian Alcohol Corporation are DISMISSED.
Out of its concern for those with less privilege in life, this Court has
inclined towards the worker and upheld his cause in his conflicts with the
employer. This favored treatment is directed by the social justice policy of the
Constitution. But while tilting the scales of justice in favor of workers, the
fundamental law also guarantees the right of the employer to reasonable
returns from his investments. Corollarily, the law allows an employer to
downsize his business to meet clear and continuing economic threats. Thus,
this Court has upheld reductions in the work force to forestall business losses
or stop the hemorrhaging of capital.
In exercising capital’s right, however, management must faithfully
comply with the substantive and procedural requirements laid down by law
and jurisprudence.
In the case at bar, Prior Holdings took over the operations of Asian
Alcohol in October 1991. Plain to see, the last quarter losses in 1991 were
already incurred under the new management. There were no signs that these
losses would abate. Irrefutable was the fact that losses have bled Asian
Alcohol incessantly over a span of several years. They were incurred under
the management of the Parsons family and continued to be suffered under the
new management of Prior Holdings.
Ultimately, it is Prior Holding that will absorb all the losses, including
those incurred under the former owners of the company. The law gives the
new management every right to undertake measures to save the company from
bankruptcy.
AMA COMPUTER COLLEGE (ACC), INC. vs. ELY GARCIA and

MA. TERESA BALLA
FACTS:
Garcia was hired as a janitress by ACC. Her employment status was

changed to probationary Library Aide. She became a regular employee on 15
February 1990.
Balla was hired as a Social Worker by ACC. She later became a

Guidance Assistant and on 2 June 1997, became a regular employee.
On 21 March 2000, Anthony R. Vince Cruz, ACC Human Resource

Director, informed Garcia and Balla and 52 other employees of the
termination of their employment.
ISSUE:
Whether or not Garcia and Balla were illegally dismissed?
HELD:
Yes, Garcia and Balla were illegally dismissed. Redundancy exists
when the service capability of the workforce is in excess of what is reasonably
needed to meet the demands of the business enterprise. Among the requisites
of a valid redundancy program are: (1) the good faith of the employer in
abolishing the redundant position; and (2) fair and reasonable criteria in
ascertaining what positions are to be declared redundant and accordingly
abolished. In the case at bar, ACC attempted to establish its streamlining
program by presenting its new table of organization. However, do not satisfy
the requirement of substantial evidence that a reasonable mind might accept
as adequate to support a conclusion. As they are, they are grossly inadequate
and mainly self-serving.
Among the accepted criteria in implementing a redundancy are: (a) less

preferred status, e.g., temporary employee; (b) efficiency; and (c)
seniority. There is no showing that ACC applied any of these criteria in
determining that, among its employees, Garcia and Balla should be dismissed,
thus, making their dismissal arbitrary and illegal.
Retrenchment, on the other hand, is the termination of employment

effected by management during periods of business recession, industrial
depression, seasonal fluctuations, lack of work or considerable reduction in
the volume of the employer’s business.
LOPEZ SUGAR CORPORATION vs. FEDERATION OF FREE

WORKERS and NATIONAL LABOR RELATIONS COMMISSION
FACTS:
Petitioner, allegedly to prevent losses due to major economic problems,
and exercising its privilege under Article XI, Section 2 of its 1975-1977
Collective Bargaining Agreement ("CBA") entered into between petitioner
and private respondent Philippine Labor Union Association ("PLUA-
NACUSIP"), caused the retrenchment and retirement of a number of its
employees.
ISSUES:
1) Whether or not the retrenched employees are entitled to
reinstatement and full backwages?
2) Whether or not the retired employees as per CBA are validly
effective?
HELD:
Court concludes that because the attempted retrenchment on the part of
the petitioner was legally ineffective, all retrenched employees should be
reinstated and backwages paid them corresponding to a period of three (3)
years without qualification or deduction, in accordance with the three-year
rule laid down in a long line of cases. In the case of employees who had
received payments for which they had executed quitclaims, the amount of
such payments shall be deducted from the backwages due to them. Where
reinstatement is no longer possible because the positions they had previously
filled are no longer in existence, petitioner shall pay backwages plus, in lieu
of reinstatement, separation pay in the amount of one-month's pay for every
year of service including the three (3) year-period of putative service for
which backwages will be paid.
Upon the other hand, we find valid the retirement of those employees
who were retired by petitioner pursuant to the applicable provisions of the
CBA.
INTERNATIONAL HARDWARE, INC. vs. NATIONAL LABOR

RELATIONS COMMISSION (THIRD DIVISION) and BONIFACIO
PEDROSO
FACTS:
Private respondent Bonifacio Pedroso was employed by petitioner first,
as a truck helper, and later as a delivery truck driver with a monthly salary of
P900.00 starting from 1966 until December 1984 when the number of
working days of private respondent was reduced to just two days a week due
to the financial losses suffered by the business of petitioner. Thus, private
respondent filed a complaint for illegal dismissal and the payment of
separation pay in the Department of Labor and Employment (DOLE).
ISSUE:
Whether or not an employee who had been retrenched or otherwise
separated from the service of an employer who, in turn, suffered financial
losses and revenues is entitled to separation pay
HELD:
Yes, an employee is entitled to a separation pay from his employer who,
in turn, suffered financial losses.
Under Article 286 of the Labor Code, it is provided as follows:
"ART. 286. When employment not deemed terminated. — The

bonafide suspension of the operation of a business or undertaking for a period
not exceeding six months, or the fulfillment by the employee of a military or
civic duty shall not terminate employment in all such cases, the employer shall
reinstate the employee to his former position without loss of seniority rights
if he indicates his desire to resume his work not later than one month from the
resumption of operations of his employer or from his relief from the military
or civic duty.
From the foregoing it is clear that when the bonafide suspension of the
operation of a business or undertaking exceeds six (6) months then the
employment of the employee shall be deemed terminated.
Thus, private respondent is entitled to one (1) month pay or at least (1/2)
month pay for every year of service, whichever is higher. The Court assumes
that the award of P8,1 00.00 separation pay in favor of the private respondent
was computed in accordance with the foregoing formula as provided by law.
ANTONIO CATATISTA vs. NATIONAL LABOR RELATIONS

COMMISSION
FACTS:
Petitioners were regular plantation workers in Hacienda Binanlutan,
one of the six haciendas operated and managed by private respondent
Victorias Milling Company, Inc. Private respondent decided to permanently
stop and close its sugarcane operations in Hacienda Binanlutan “due to low
sugar prices which affected the viability and profitability of said hacienda”
and convert it instead into an ipil-ipil plantation. In view of such decision,
management subsequently held a conference with all thirteen field workers to
explain to them the reason for this move, as well as the computation of their
termination pay. Their services would be terminated.
ISSUE:
Whether or not they were illegally terminated from work resulting from
the closure of Hacienda Binanlutan?
HELD:
No, the termination was validly effected. The termination of
employment of the employees of Hacienda Binanlutan brought about by the
closure is to be considered as retrenchment as Hacienda Binanlutan is only
one of the six haciendas of private respondent.
The requisites of a valid retrenchment are: (a) the losses expected

should be substantial and not merely de minimis in extent; (b) the substantial
losses apprehended must be reasonably imminent; (c) the retrenchment must
be reasonably necessary and likely to effectively prevent the expected losses;
and (d) the alleged losses, if already incurred, and the expected imminent
losses sought to be forestalled, must be proved by sufficient and convincing
evidence.
Considering the losses suffered by private respondent, it is logical for

it to implement a retrenchment program to prevent further losses. Private
respondent’s personnel reduction program was meant to reduce excessive
labor cost in the company.
Having determined that private respondent suffered losses and had to

resort to retrenchment of its employees in Hacienda Binanlutan to prevent
further losses, this Court holds that private respondent was within its rights in
closing Hacienda Binanlutan and in terminating the service of petitioners.
Having established that private respondent’s closure of Hacienda
Binanlutan was done in good faith and that it was due to causes beyond its
control, the conclusion is inevitable that said closure is valid. Consequently,
petitioners could not have been illegally dismissed.
COCA-COLA BOTTLERS (PHILS.), INC. vs. NATIONAL LABOR

FACTS:
On 13 January 1987, private respondent union filed against petitioner a
complaint for illegal dismissal of twenty-one (21) of its members.
An amended complaint dated 2 May 1988 and several original

complaints were subsequently filed by private respondent union alleging that
other union members were similarly dismissed by petitioner, making a total
of ninety-eight (98) workers allegedly illegally dismissed and ten (10)
workers allegedly illegally transferred by petitioner. The complaints also
asserted claims by members of private respondent union for 13th month pay,
service incentive leave pay, interest and attorney's fees, and included a prayer
for reinstatement and backwages. Complainants also claimed that their
dismissal was tainted with unfair labor practice.
ISSUES:
Whether or not complaining workers had been deprived of due process
not having been given an opportunity to prove that the termination of the
services of the same had been effected for a valid and legal cause?
HELD:
Yes, they were deprived of due process. The illegal dismissal cases
were thus in effect brought and resumed by the members of private respondent
union as employees of petitioner-company. The burden of proving that the
termination of the services of the members of respondent union was for a valid
or authorized cause, lay upon petitioner employer. That burden was not
discharged by petitioner which, for reasons satisfactory to itself, chose not to
submit any memorandum or other pleadings before the Labor Arbiter after
this Court had resolved the issue of the worker's employment status. Thus, the
Labor Arbiter and the NLRC were correct in holding that the members of
private respondent union had been illegally dismissed by petitioner-company.
Ordinarily, the closing of a warehouse facility and the termination of

the services of employees there assigned is a matter that is left to the
determination of the employer in the good faith exercise of its management
prerogatives. The Labor Code permits "closure or cessation of operation of an
establishment or undertaking not due to serious business losses or financial
reverses," which, includes both the complete cessation of operations and the
cessation of only part of a company's activities. In such a case, however, the
company is required to notify both the employees concerned and the
Department of Labor and Employment ("DOLE") at least one (1) month
before the intended date of closure. The notice to the DOLE is, of course,
intended to enable the proper authorities to determine after hearing whether
such closure is being done in good faith, i.e., for bonafide business reasons,
or whether, to the contrary, the closure is being resorted to as a means of
evading compliance with the just obligations of the employer to the employees
affected.
EDGE APPAREL, INC. vs. NATIONAL LABOR RELATIONS

COMMISSION
FACTS:
Pursuing its retrenchment program, petitioner Edge Apparel, Inc.,
dismissed private respondents Josephine Antipuesto, Norina Ando, Juliet
Baguio, Apolinaria Velonta, Corazon Pino and Josephine Cañete from
employment effective 03 September 1992.
ISSUE:
Whether or not private respondents were illegally dismissed?
HELD:
No, the private respondents were not illegally dismissed. Article 283,
specifies the authorized causes for the termination of employment, viz:
(a) installation of labor-saving devices; (b) redundancy;
(c) retrenchment to prevent losses; and (d) closing or cessation of
operation of the establishment or undertaking unless the closing is for the
purpose of circumventing the provisions of law.
In addition, Article 284 provides that an employer would be authorized

to terminate the services of an employee found to be suffering from any
disease if the employee's continued employment is prohibited by law or is
prejudicial to his health or to the health of his fellow employees.
In this case, the Labor Arbiter and the NLRC both concluded that there
had been a valid ground for the retrenchment of private respondents. The
documents presented in evidence were found to "conclusively show that
(petitioner) suffered serious financial losses." The general standards or
elements needed for the retrenchment to be valid - i.e., that the losses expected
are substantial and not merely de minimis in extent; that the expected losses
are reasonably imminent such as can be perceived objectively and in good
faith by the employer; that the retrenchment is reasonably necessary and likely
to effectively prevent the expected losses; and that the imminent losses sought
to be forestalled are substantiated -were adequately shown in the present
case. The findings of the Labor Arbiter and the NLRC would negate any
impression that petitioner was guilty of bad faith or misdoing in its
retrenchment policy.
Procedurally, in order to validly effect retrenchment, the employer must

observe two other requirements, viz: (a) service of a prior written notice of at
least one month on the workers and the Department of Labor and
Employment, and (b) payment of the due separation pay.
ASIAN ALCOHOL CORPORATION vs. NATIONAL LABOR

RELATIONS COMMISSION,
FACTS:
In September, 1991, the Parsons family, who originally owned the
controlling stocks in Asian Alcohol, was driven by mounting business losses
to sell their majority rights to prior Holdings, Inc. (hereinafter referred to as
Prior Holdings). The next month, Prior Holdings took over its management
and operation.
To thwart further losses, Prior Holdings implemented a

reorganizational plan and other cost-saving measures. Some one hundred
seventeen (117) employees out of a total workforce of three hundred sixty
(360) were separated. Seventy two (72) of them occupied redundant positions
that were abolished.
ISSUE:
Whether or not the dismissal of complainants on ground of
redundancy/retrenchment was perfectly valid or legal?
HELD:
Yes. The complaints for illegal dismissal filed by private respondents
against Asian Alcohol Corporation are DISMISSED.
Out of its concern for those with less privilege in life, this Court has
inclined towards the worker and upheld his cause in his conflicts with the
employer. This favored treatment is directed by the social justice policy of the
Constitution. But while tilting the scales of justice in favor of workers, the
fundamental law also guarantees the right of the employer to reasonable
returns from his investments. Corollarily, the law allows an employer to
downsize his business to meet clear and continuing economic threats. Thus,
this Court has upheld reductions in the work force to forestall business losses
or stop the hemorrhaging of capital.
In exercising capital’s right, however, management must faithfully

comply with the substantive and procedural requirements laid down by law
and jurisprudence.
In the case at bar, Prior Holdings took over the operations of Asian
Alcohol in October 1991. Plain to see, the last quarter losses in 1991 were
already incurred under the new management. There were no signs that these
losses would abate. Irrefutable was the fact that losses have bled Asian
Alcohol incessantly over a span of several years. They were incurred under
the management of the Parsons family and continued to be suffered under the
new management of Prior Holdings.
Ultimately, it is Prior Holding that will absorb all the losses, including
those incurred under the former owners of the company. The law gives the
new management every right to undertake measures to save the company from
bankruptcy.
MANLY EXPRESS INC. vs. ROMUALDO PAYONG, JR.
FACTS:
Hercules Balena and Romualdo Payong, Jr. were employed by Manly
Express, Inc. and/or Siy Eng T. Ching on different dates, as tour coordinator
(dispatcher) and welder, respectively.
Balena alleged that during his employment, he demanded from his

employer the payment of correct employee’s benefits. Nevertheless, every
time he made the demand, he was told not to report for work anymore if he is
not contented with the wages he was receiving. Then, herein private
respondents called Balena’s attention on his tardiness in work.
Petitioner Romualdo Payong, Jr. has another story to tell. Sometime in

December 1999, he was complaining of eyesight problems. Brought to an eye
specialist by private respondent Ching, he was diagnosed to be suffering from
eye cataract. Despite having the cataract removed in January of 2000, he was
disallowed to return to his work by Ching. Much later, on August 1, 2000, he
was given a letter of termination of employment.
ISSUE:
Whether or not private respondent—Payong was legally dismissed due
to his partial blindness as authorized cause?
HELD:
The rule is explicit. For a dismissal on the ground of disease to be
considered valid, two requisites must concur: (a) the employee suffers from a
disease which cannot be cured within six months and his continued
employment is prohibited by law or prejudicial to his health or to the health
of his co-employees, and (b) a certification to that effect must be issued by a
competent public health authority.
In the present case, there was no proof that Payong’s continued
employment was prohibited by law or prejudicial to his health and that of his
co-employees. No medical certificate by a competent public health authority
was submitted that Payong was suffering from a disease that cannot be cured
within a period of six months. In the absence of such certification, Payong’s
dismissal must necessarily be declared illegal.
Payong’s dismissal did not comply with both the substantive and
procedural aspects of due process. Clearly, his dismissal is tainted with
invalidity.
CEBU ROYAL PLANT (SAN MIGUEL CORPORATION) vs. THE

HONORABLE DEPUTY MINISTER OF LABOR and RAMON
PILONES
FACTS:
The private respondent was removed by the petitioner and complained
to the Ministry of Labor.
The alleged ground for his removal, to wit, "pulmonary tuberculosis

minimal," was not certified as incurable within six months as to justify his
separation.
The petitioner for its part claims that the private respondent was still on
probation at the time of his dismissal and so had no security of tenure. His
dismissal was not only in conformity with company policy but also necessary
for the protection of the public health, as he was handling ingredients in the
processing of soft drinks which were being sold to the public.
ISSUES:
Whether or not private respondent is a regular employee?
Whether or not private respondent was illegally dismissed?
HELD:
Yes, the private respondent is a regular employee and the same is
illegally dismissed. The six-month period of probation started from the said
date of appointment and so ended on August 17, 1978, but it is not shown that
the private respondent's employment also ended then; on the contrary, he
continued working as usual. Under Article 282 of the Labor Code, "an
employee who is allowed to work after a probationary period shall be
considered a regular employee." Hence, Pilones was already on permanent
status when he was dismissed on August 21, 1978, or four days after he ceased
to be a probationer.
The record does not contain the certification required by the above rule.
The medical certificate offered by the petitioner came from its own physician,
who was not a "competent public health authority," and merely stated the
employee's disease, without more. This Court may surmise that if the required
certification was not presented, it was because the disease was not of such a
nature or seriousness that it could not be cured within a period of six months
even with proper medical treatment. If so, dismissal was unquestionably a
severe and unlawful sanction.
FUJITSU COMPUTER PRODUCTS CORPORATION OF THE vs.

COURT OF APPEALS, VICTOR DE GUZMAN and ANTHONY P.
ALVAREZ
FACTS:
Respondent Victor de Guzman began working for FCPP on September

21, 1997 as Facilities Section Manager. Respondent Allan Alvarez, on the
other hand, was employed as a Senior Engineer on April 21, 1998.
The private respondent- Mr. Alvarez was imputed of malicious acts

undermining the result of the ongoing administrative investigation involving
Mr. De Guzman, and therefore, constitutes serious misconduct. Petitioner
contends that his actions do not speak well of a ranking Senior Engineer in
the Facilities Section especially in consideration of the fact that he has several
employees reporting to him and should in fact, serve as their role model.
In view of the foregoing ineluctable facts, he was terminated from the

service.
ISSUE:
Whether or not Mr. Alvarez herein petitioner was afforded of due
process?
HELD:
No. Mr. Alvarez was deprived of due process. It is settled that to
constitute a valid dismissal from employment, two requisites must concur: (a)
the dismissal must be for any of the causes provided for in Article 282 of the
Labor Code; and (b) the employee must be afforded an opportunity to be heard
and defend himself. This means that an employer can terminate the services
of an employee for just and valid causes, which must be supported by clear
and convincing evidence. It also means that, procedurally, the employee must
be given notice, with adequate opportunity to be heard, before he is notified
of his actual dismissal for cause.
To be valid ground for dismissal, loss of trust and confidence must be
based on a willful breach of trust and founded on clearly established facts. A
breach is willful if it is done intentionally, knowingly and purposely, without
justifiable excuse, as distinguished from an act done carelessly, thoughtlessly,
heedlessly, or inadvertently. It must rest on substantial grounds and not on
the employer’s arbitrariness, whims, caprices or suspicion; otherwise, the
employee would eternally remain at the mercy of the employer. Loss of
confidence must not be indiscriminately used as a shield by the employer
against a claim that the dismissal of an employee was arbitrary. And, in order
to constitute a just cause for dismissal, the act complained of must be work-
related and shows that the employee concerned is unfit to continue working
for the employer.
PHILIPPINE NATIONAL BANK vs. FLORENCE O. CABANSAG
FACTS:
On April 16, 1999, Ruben C. Tobias again summoned Florence O.
Cabansag to his office and demanded that she submit her letter of resignation,
with the pretext that he needed a Chinese-speaking Credit Officer to penetrate
the local market, with the information that a Chinese-speaking Credit Officer
had already been hired and will be reporting for work soon. She was warned
that, unless she submitted her letter of resignation, her employment record
will be blemished with the notation ‘DISMISSED’ spread thereon. Without
giving any definitive answer, Florence O. Cabansag asked Ruben C. Tobias
that she be given sufficient time to look for another job.
However, on April 19, 1999, Ruben C. Tobias again summoned

Florence O. Cabansag and adamantly ordered her to submit her letter of
resignation. She refused. On April 20, 1999, she received a letter from Ruben
C. Tobias terminating her employment with the Bank.
ISSUE:
Whether or not private respondent was deprived of due process in
effecting her termination from employment?
HELD:
As a regular employee, respondent was entitled to all rights, benefits
and privileges provided under our labor laws. One of her fundamental rights
is that she may not be dismissed without due process of law. The twin
requirements of notice and hearing constitute the essential elements of
procedural due process, and neither of these elements can be eliminated
without running afoul of the constitutional guarantee.
In dismissing employees, the employer must furnish them two written

notices: 1) one to apprise them of the particular acts or omissions for which
their dismissal is sought; and 2) the other to inform them of the decision to
dismiss them. As to the requirement of a hearing, its essence lies simply in
the opportunity to be heard.
Respondent was not notified of the specific act or omission for which
her dismissal was being sought. Neither was she given any chance to be heard,
as required by law. At any rate, even if she were given the opportunity to be
heard, she could not have defended herself effectively, for she knew no cause
to answer to.
The employer has the burden of proving that it was done for any of the
just or authorized causes under the Code. The failure to discharge this burden
means that the dismissal was not justified, and that the employee is entitled to
reinstatement and back wages.
INTERNATIONAL HARDWARE, INC. vs. NATIONAL LABOR

RELATIONS COMMISSION (THIRD DIVISION) and BONIFACIO
PEDROSO
FACTS:
Private respondent Bonifacio Pedroso was employed by petitioner first,
as a truck helper, and later as a delivery truck driver with a monthly salary of
P900.00 starting from 1966 until December 1984 when the number of
working days of private respondent was reduced to just two days a week due
to the financial losses suffered by the business of petitioner. Thus, private
respondent filed a complaint for illegal dismissal and the payment of
separation pay in the Department of Labor and Employment (DOLE).
ISSUE:
Whether or not an employee who had been retrenched or otherwise
separated from the service of an employer who, in turn, suffered financial
losses and revenues is entitled to separation pay
HELD:
Yes, an employee is entitled to a separation pay from his employer who,
in turn, suffered financial losses. Under Article 286 of the Labor Code, it is
provided as follows:
"ART. 286. When employment not deemed terminated. — The

bonafide suspension of the operation of a business or undertaking for a period
not exceeding six months, or the fulfillment by the employee of a military or
civic duty shall not terminate employment in all such cases, the employer shall
reinstate the employee to his former position without loss of seniority rights
if he indicates his desire to resume his work not later than one month from the
resumption of operations of his employer or from his relief from the military
or civic duty.
From the foregoing it is clear that when the bonafide suspension of the
operation of a business or undertaking exceeds six (6) months then the
employment of the employee shall be deemed terminated.Thus, private
respondent is entitled to one (1) month pay or at least (1/2) month pay for
every year of service, whichever is higher.
Servidad v. NLRC
Facts:
Petitioner Servidad was employed by respondent INNODATA as a
Data Control Clerk. After working for 6 months, he was made to sign a three-
month probationary employment and later, an extended three-month
probationary employment.
On July 7, 1994, the petitioner was given an overall rating of 100% and
98% in the work evaluations conducted by the company. In another
evaluation, petitioner received a rating of 98.5% given by the private
respondent.
On May 9, 1995, petitioner was dismissed from the service on the

ground of alleged termination of contract of employment.
Issue:
Whether the contract between the employer and employee was for a
fixed term and whether the dismissal was valid
Held:
The contract was not for a fixed term and the dismissal is invalid.
In their contract which provided 2 periods, the private respondent did not
specify the criteria for the termination or retention of the services of
petitioner. Such a wide leeway for the determination of the tenure of an
employee during a one year period of employment is violative of the right of
the employee against unwarranted dismissal.
If the contract was really for a fixed term, the private respondent should
not have been given the discretion to dismiss the petitioner during the one year
period of employment for reasons other than the just and authorized causes
under the Labor Code. Settled is the rule that an employer can terminate the
services of an employee only for valid and just causes which must be shown
by clear and convincing evidence.
The language of the contract in dispute is truly a double-bladed scheme

to block the acquisition of the employee of tenurial security. Thereunder,
private respondent has two options. It can terminate the employee by reason
of expiration of contract, or it may use “failure to meet work standards” as the
ground for the employee’s dismissal. In either case, the tenor of the contract
jeopardizes the right of the worker to security of tenure guaranteed by the
Constitution.
SALAW vs. NLRC
FACTS:
Espero Salaw was employed by the Associated Bank in 1967as a credit-
investigator-appraiser. He was terminated for alleged serious misconduct or
willful disobedience and fraud or willful breach of the trust reposed upon him by
the bank.
Salaw then filed a complaint for illegal termination against the

Associated Bank, Tengco (as chairman of the board) and Tuazon (as bank manager).
The Labor Arbiter ruled that Salaw was illegally dismissed and ordered his
reinstatement or payment of backwages and benefits. The respondents appealed
and the NLRC reversed the decision of the Labor Arbiter.
ISSUE:
Whether or not Salaw was illegally terminated.
HELD:
The termination of Salaw is illegal.
The dismissal must not only be for a valid or authorized ause as

provided by law but the rudimentary requirements of due process-notice and
hearing-must also be observed before an employee may be dismissed.
Petitioner Salaw was terminated without due process of law. The

requirement of notice is intended to inform the employee concerned of
the employer's intent to dismiss him and the
reason for the proposed dismissal; on the other hand, the quirement
of hearing affords the employee the opportunity to answer his employer's
charges against him and accordingly to defend himself before dismissal is
effected. The initial act of the bank in convening the disciplinary council
would have been a proper step had Salaw been allowed the assistance of
counsel. That would have been a compliance on the requirement of due
process had he been given an opportunity to present his own defense and
confront witnesses, if any and examine the evidences against him. The
records indicate that there was a denial of Salaw’s constitutional right
when his subsequent request to refute the allegations against him
was granted and a hearing was set without counsel or representative.
JOEL MENDOZA vs. NATIONAL LABOR RELATIONS

COMMISSION, SAN MIGUEL CORPORATION, MAGNOLIA
DIVISION and CONRAD YUMANG III
FACTS:
In no uncertain terms petitioner herein admitted the gravity of his
offense and asked that a heavy penalty should be imposed on him.
At such investigation, private respondent SMC found that petitioner

violated the company's policy on employees conduct on three counts, namely
(1) driving under the influence of liquor; (2) unauthorized use of company
vehicle; and (3) damage to company vehicle which was a total wreck. As a
matter of fact, Mr. and Mrs. Pablo Cognoden, the owner of the house the
kitchen of which was hit by the delivery truck driven by petitioner sought
from SMC the amount of P50,000.00 for actual damages.
ISSUE:
Whether or not petitioner Mendoza was afforded of due notice and
hearing to effect the termination of his employment?
HELD:
Yes. The dismissal of the petitioner is with due process and valid. The
rules lay down by the company for the investigation of an employee before
his termination need not be observed to the letter. It is enough that there was
due notice and a hearing before a judgment or resolution thereof is made.
Due process contemplates freedom from arbitrariness. What it requires

is fairness or justice; the substance' rather than the form being paramount.
When a party has been given the opportunity to be heard, then he was afforded
due process.
HOMEOWNERS SAVINGS AND LOAN ASSOCIATION, INC. vs.
NATIONAL LABOR RELATIONS COMMISSION and MARILYN
CABATBAT
FACTS:
Private respondent Marilyn Cabatbat, was employed as Branch
Accountant in petitioner’s branch office in San Carlos City. On September
14, 1984, petitioner issued Memorandum No. 0984 addressed to all branches,
announcing management’s decision to promote five (5) junior officers and to
move four (4) of its employees to new assignments. The latter group of
employees was made to retain their original items. Private respondent was
among those moved from her old post in San Carlos Branch. She was
transferred to the petitioner’s branch in Urdaneta, also in Pangasinan. Both
the promoted and the transferred employees received corresponding increases
in their salaries
In a letter, dated October 3, 1984, private respondent requested

deferment of her new assignment, citing as her reason the fact that she was on
her sixth month of pregnancy. The request was granted.
On February 18, 1985, after private respondent’s delivery, petitioner

again ordered private respondent to report to her new assignment. Private
respondent again requested that the order to re-assign her be reconsidered
because of some very personal reasons, particularly based on the need to
maintain “harmonious relationship with her parents-in-law” with whom she
then lives. On February 19, 1985, she wrote AVP Tuason protesting her new
assignment and reiterated her appeal for the reconsideration of the order for
her transfer maintaining that “my new assignment would entail additional
expenses and physical exhaustion as Urdaneta is too far for me to commute
everyday.
ISSUE:
Whether or not the manner of private respondent’s dismissal was illegal
for being made without due process?
HELD:
In the case at bench, Court tips the scales of justice in favor of the
employer. No doubt, private respondent was accorded due process. No less
than seven (7) memoranda were issued to private respondent urging her to
follow the directive of management transferring her to the Urdaneta Branch
coupled with a generous offer by the petitioner to pay or reimburse her for
the actual cost of transportation that she may incur as a result of the new
assignment. Unfortunately, private respondent stubbornly chose to turn a deaf
ear to these notices. Ultimately, she has no one to blame but herself. The law,
in protecting the rights of the laborer, authorizes neither oppression nor self-
destruction of the employer.
DANILO J. MAGOS vs. NATIONAL LABOR RELATIONS
COMMISSION
FACTS:
Danilo J. Magos became an employee of PEPSI on 5 April 1987. He
rose from the ranks until he was appointed Route/Area Manager covering
different areas in Northern Mindanao.
On the basis of these reports, Magos was notified by District Manager

Booc of his temporary recall effective 1 July 1992 on the ground of
his "continued refusal to follow orders/instructions of a superior after 2 or
more successive reminders or warnings." He was also required to submit a
written explanation, which he did on 30 June 1992 citing among others: (a)
the lack of proper turnover of jurisdiction to distributor and guidelines thereto;
(b) the rapid conversion to Coke of previous big account dealers like Boy Lim
in Siargao; and, (c) the lack of ability of Andanar to supply such dealers.
Finding Magos’ explanation insufficient PEPSI on 27 July 1992

notified Magos of an administrative investigation against him on grounds of
disobedience and breach of trust and confidence as shown by the reports of
Endozo and Ganzon, the audit reports of the Home Office Auditors, the
complaint of Andanar and the memorandum of Booc. On 7 September 1992,
Magos was notified of his termination for disobedience and breach of trust
and confidence.
ISSUES:
Whether or not petitioner Magos was afforded of the opportunity to be
heard before he was dismissed from employment?
Whether or not a managerial employee like petitioner Magos was
unquestionably clothed with the discretion to determine the circumstances
upon which he could implement the policies of the company?
HELD:
Although a hearing is essential to due process, in Bernardo v. NLRC,
Court did hold that no formal hearing was necessary when the petitioner had
already admitted his responsibility for the act he was accused of.
Even though petitioner in this case never admitted the accusations of

dishonesty against him, he impliedly acknowledged his insubordination as
shown in his petition.
Petitioner had however admitted as a sign of good faith, the various

'saving measures' that he undertook to prevent the competitors from easing
out Private Respondent from its dominant market hold in Siargao Island.
MARANAW HOTEL AND RESORT CORP. v. NLRC
FACTS:
Damalerio was a roomboy for Maranaw Hotel. One day, he was
cleaning the room of one of the guests when he saw the private stuff of the
guest scattered all over the floor. So he took it upon him to pick those up and
put in the guest’s bag but then when he was doing so the guest (Jamie Glaser)
entered the room and saw Damalerio’s hand inside Glaser’s bag. Glaser filed
a complaint against Damalerio. Damalerio was dismissed subsequently.
ISSUE:
Whether or not Damalerio was illegally dismissed?
HELD:
Yes. Although it was not completely proper for Damalerio to be
touching the things of a hotel guest while cleaning the hotel rooms, personal
belongings of hotel guests being off-limits to roomboys, under the attendant
facts and circumstances, that the dismissal of Damalerio was unwarranted. To
be sure, the investigation held by the hotel security people did not unearth
enough evidence of culpability. It bears repeating that Glaser lost nothing.
Albeit Maranaw Hotels may have reasons to doubt the honesty and
trustworthiness of Damalerio, as a result of what happened, absent sufficient
proof of guilt, Damalerio, who is a rank-and-file employee, cannot be legally
dismissed.
As for the service charges received by Maranaw Hotels during the

period where he was not able to work he’s entitled to the shares therefrom.
But if he chooses not to be reinstated by reason of the estranged relations with
the hotel, he’s entitled to separation pay but without the shares from the
service charges anymore.
AGABON vs. NLRC
Facts:
Virgilio and Jenny Agabon were cornice installers of Riviera Home
Improvements, a company engaged in the business of selling ornamentals
construction materials.
They were employed from January 2, 1992 until February 23, 1999,
when they were dismissed for abandonment of work.
The Agabons filed a complaint for illegal dismissal before the LA, who
ruled in their favor. The NLRC reversed on appeal. The CA sustained the
decision of the NLRC.
The Agabons further appealed to the SC, disputing the finding of

abandonment, and claiming that the company did not comply with the twin
requirements of notice and hearing.
Issue:
Whether or not the Agabons were illegally dismissed
Held:
No. Substantive due process (EEs must be dismissed for just or
authorized cause): SC upheld the finding of abandonment, because the act of
the Agabons in seeking employment elsewhere clearly showed a deliberate
intent to sever the ER-EE relationship.
Procedural due process (for just cause, there must be a written

notice informing him of grounds for termination, a hearing or opportunity to
be heard, and a final notice of termination stating the grounds therefor): There
was no due process because ER did not send the requisite notices to the last
known address of the EEs. ER only gave a flimsy excuse that the notice would
be useless because the EEs no longer lived there. This is not a valid excuse,
they should have still sent a notice as mandated by law.
For not sending the requisite notices, the ER should be held liable for
non-compliance with the procedural requirements of due process.
CARLO RANARA, vs. NATIONAL LABOR RELATIONS

COMMISSION
FACTS:
The private respondents denied the charges, contending that the
petitioner had not been illegally dismissed. Chang said he was in a hospital in
Manila on November 11, 1989, and that he had not authorized Leonar, or even
his mother who was the officer-in-charge during his absence, to terminate
Ranara's employment. The truth was that it was Ranara who abandoned his
work when he stopped reporting from November 11, 1989. Chang also
introduced documentary evidence, consisting of payroll and other records, to
refute the petitioner's monetary claims.
On May 2, 1990, the Labor Arbiter held that Ranara had not been
illegally dismissed. 1 The decision stressed that at the hearing of December
28, 1989, Chang offered to re-employ the petitioner as he was needed in the
store but the latter demurred, saying he was no longer interested. This attitude,
according to the Labor Arbiter, showed that it was the petitioner who chose to
stop working for Chang and not the latter who terminated his employment.
ISSUE:
Whether or not the petitioner is illegally dismissed or not
HELD:
The petitioner in this case was an ordinary driver in the private
respondents' employ. He had no special abilities to make him indispensable
to his employer. He did not belong to a powerful labor union vigilant of the
rights of its members. The employer thought his services were disposable at
will and so arbitrarily dismissed him. They miscalculated, for the petitioner
was not really that vulnerable. The fact is that. alone though he was, or so it
appeared, he had behind him, even as a lowly worker, the benevolence of the
law and the protection of this Court.
WHEREFORE, the challenged decision of the NLRC is AFFIRMED,

with the modification that in addition to the monetary awards therein
specified, the petitioner shall be entitled to separation pay and three years'
back wages in lieu of reinstatement. No costs.
ZENAIDA GACO vs. THE HONORABLE NATIONAL LABOR

RELATIONS COMMISSION and ORIENT LEAF TOBACCO
CORPORATION
FACTS:
Petitioner was hired by private respondent on April 17, 1974 for the
position of Picker. In 1975, after a year of service, she was promoted to the
position of Production Recorder. She held this position for a period of fourteen
(14) years until the end of private respondent's working season in 1989. In
April, 1990, when petitioner reported for work at the start of the working
season for that year, she found out that her position was already occupied by
another employee and that she was being demoted to the position of Picker.
Petitioner believed that, having been with private respondent for fifteen
(15) years without any derogatory record, her demotion was not justified.
Considering it as constructive dismissal, petitioner thus refused to report for
work and filed a complaint before the Labor Arbiter for payment of separation
pay.
Petitioner argues that she should be awarded backwages because she

was dismissed illegally. Respondent NLRC had no basis in computing the
separation pay at one-half (1/2) month pay for every year of service. In
numerous labor cases decided by this Court, the basis for computation thereof
is one (1) month pay for every year of service. As a normal consequence of
having been dismissed illegally and forced to litigate, she should be awarded
moral damages and attorney's fees.
ISSUE:
Whether or not grave abuse of discretion committed by the respondent
on dismissal of the petitioner.
HELD:
This has been our consistent ruling in numerous decisions awarding
separation pay to an illegally dismissed employee in lieu of reinstatement. 15 It
should be emphasized that separation pay is being awarded in this case for
this reason, a fact which the Office of the Solicitor General overlooked.
WHEREFORE, the petition is hereby GRANTED. The decision of the

National Labor Relations Commission dated January 27, 1992 is SET ASIDE
and the decision of the Labor Arbiter dated July 31, 1991 is REINSTATED
subject to the modification that the period of backwages should be from April,
1990 up to the finality of this decision less earnings elsewhere, if any, during
this period whereas the period of separation pay should be from April, 1974
up to the finality of this decision.
JACINTO RETUYA vs. Hon. SALIC B. DUMARPA
FACTS:
Private respondent, Insular Builders, Inc., is a family-owned
corporation managed and operated principally by Antonio Murillo, father, and
his son, Rodolfo Murillo. It is engaged in the construction
business. Petitioners, on the other hand, were workers who have rendered
services in various corporations of private respondents, namely Mindanao
Integrated Builders, Inc., Sta. Clara Plywood, Inc., Insular Builders, Inc. and
Queen City Builders, Inc.
Illegally dismissed employees are entitled to back wages that should

not be diminished or reduced by the amount they have earned from another
employment during the period of their illegal dismissal. On the other hand,
the computation of the separation pay and the circumstances showing the
existence of an employer-employee relationship are questions of fact that are
generally not proper in a petition for review on certiorari.
ISSUE:
Whether or not the decision of Court of Appeals is affirm or not.
HELD:
Finally, it may not be amiss to add that piercing the corporate veil and
considering Insular and Queen City as one entity would be disadvantageous
to petitioners, because doing so would no longer entitle them to back wages
and separation pay. Indeed, if the two entities were one and the same
company, then there would have been no dismissal from one and transfer to
the other to speak about.
UNION OF SUPERVISORS (R.B.) — NATU, vs. THE SECRETARY

OF LABOR
FACTS:
On April 15, 1974, a supplemental complaint was filed by the same
petitioner with the allegation that after filing of the original complaint, the
respondent Bank followed up its harassment of Mr. Luna by terminating his
employment as Branch Manager and as trustee, administrator and secretary of
the RB Provident Fund purportedly due to his libelous remarks against the
bank management (pp. 18-19, rec.). Such termination was effected through a
letter dated April 5, 1974 of the Bank President, Mr. Pablo Roman to the said
Mr. Luna, citing as basis thereof (1) grave misconduct for making derogatory
and libelous remarks against the bank management as a whole and against the
assistant vice-president in particular, and (2) insubordination for refusal to
obey the lawful order of his superior, the Chairman of the RB Provident Fund
(pp. 206-207, NLRC rec.). On May 20, 1974, respondent bank filed its
answer, denying the allegations in the original as well as the supplemental
complaint and contending that Mr. Luna's suspension and subsequent
dismissal from his various positions were for cause and had nothing to do with
his alleged espousal and defense of workers' rights (pp. 20-21, rec.).
ISSUE:
Whether or not the respondent is correct for the reinstatement of the
petitioner
HELD:
In the case at bar, Luna, the complaining witness had more than 21
years of service with respondent bank, starting on April 2, 1953. The record
is not clear as to what position he first held; but it is undisputed that he was
the Branch Manager of respondent bank's San Juan Branch and for eleven (11)
years the president of the RB Union of Supervisors. It is likewise not denied
that the Union of Supervisors had, prior to this case, caused the filing of
several cases against the bank with the NLRC.
DIVINE WORD HIGH SCHOOL AND REV. VIC TIAM, SVD.
DIRECTOR, vs. THE NATIONAL LABOR RELATIONS
COMMISSION AND LUZ MALLBO CATENZA
FACTS:
Petition filed by Divine Word High School and its Director Rev. Vic
Tiam to review and set aside the decision of public respondent National Labor
Relations Commission (NLRC) dated August 5, 1985, which modified the
decision of the Labor Arbiter. The said decision was modified on appeal by
respondent NLRC, hence, this petition for review after petitioner's motion for
reconsideration had been denied.
Likewise devoid of merit is petitioners' contention that they were

denied due process of law when the Labor Arbiter considered the case
submitted for decision notwithstanding the fact that petitioners had not yet
rested their case. Scrutiny of the records shows that petitioners were afforded
every opportunity to present their evidence but they repeatedly failed to
appear at the four (4) consecutive hearings scheduled for the purpose. It is
settled that there is no denial of due process where petitioner was afforded an
opportunity to present his case.
ISSUE:
Whether or not the respondent has the right to received separation pay?
HELD:
After a review of the records of the case, we agree with the following
finding of the Labor Arbiter (which finding has also been affirmed by the
NLRC;
A careful review and evaluation of the entire records of the case show
clearly that complainant was dismissed without a valid cause. ALL throughout
the records of the case it is very apparent that the main reason she was
dismissed was because of the alleged immoral conduct of her husband.
Nonetheless, we hesitate ordering the reinstatement of private

respondent Luz Ballano Catenza as a high school teacher in the petitioner high
school, which is a Catholic institution, serving the educational and moral
needs of its Catholic studentry.
Panuncillo, vs. CAP Phil. Inc., February 9, 2007
FACTS:
Respondent thereupon terminated the services of petitioner by
Memorandum dated April 20, 1999.
Petitioner nevertheless argues that she was not afforded due process
before her dismissal as she was merely required to answer a show-cause
memorandum dated April 7, 1999 and there was no actual investigation
conducted in which she could have been heard.
Respondent subsequently sent petitioner a show-cause memorandum

giving her 48 hours from receipt why she should not be disciplinarily
sanctioned. Despite the 48-hour deadline, nothing was heard from her
until April 10, 1999 when she complied with the second show-cause
memorandum dated April 7, 1999.
ISSUE:
Whether or not the respondent is obliged to reinstate petitioner and pay
her salary?
HELD:
Since this Court is now affirming the challenged decision of the Court
of Appeals finding that petitioner was validly dismissed and accordingly
reversing the NLRC Decision that petitioner was illegally dismissed and
should be reinstated, petitioner is not entitled to collect any backwages from
the time the NLRC decision became final and executor up to the time the
Court of Appeals reversed said decision.
NORBERTO SORIANO vs. OFFSHORE SHIPPING AND MANNING

CORPORATION, KNUT KNUTSEN O.A.S., and NATIONAL LABOR
FACTS:
This is a petition for certiorari seeking to annul and set aside the
decision of public respondent National Labor Relations Commission
affirming the decision of the Philippine Overseas Employment
Administration in POEA Case No. (M)85-12-0953 entitled "Norberto Soriano
v. Offshore Shipping and Manning Corporation and Knut Knutsen O.A.S.",
which denied petitioner's claim for salary differential and overtime pay and
limited the reimbursement of his cash bond to P15,000.00 instead of
P20,000.00.
In search for better opportunities and higher income, petitioner

Norberto Soriano, a licensed Second Marine Engineer, sought employment
and was hired by private respondent Knut Knutsen O.A.S. through its
authorized shipping agent in the Philippines, Offshore Shipping and Manning
Corporation. As evidenced by the Crew Agreement, petitioner was hired to
work as Third Marine Engineer on board Knut Provider" with a salary of
US$800.00 a month on a conduction basis for a period of fifteen (15) days.
Petitioner submits that public respondent committed grave abuse of discretion
and/or acted without or in excess of jurisdiction by disregarding the alteration
of the employment contract made by private respondent. Petitioner claims that
the alteration by private respondent of his salary and overtime rate which is
evidenced by the Crew Agreement and the exit pass constitutes a violation of
Article 34 of the Labor Code of the Philippines. 6
ISSUE:
Whether or not the decision of the NLRC is correct affirming the POEA
for the claim of reinstatement?
HELD:
In the case at bar, both the Labor Arbiter and the National Labor
Relations Commission correctly analyzed the questioned annotations as not
constituting an alteration of the original employment contract but only a
clarification thereof which by no stretch of the imagination can be considered
a violation of the above-quoted law.
DANDY V. QUIJANO vs. MERCURY DRUG CORPORATION and

NATIONAL LABOR RELATIONS COMMISSION
FACTS:
Petitioner DANDY V. QUIJANO was a warehouseman at the central
warehouse of respondent MERCURY DRUG CORPORATION in Libis,
Quezon City, since 1983. During his 8-year stay in the company, he received
high performance ratings and a corresponding 15% increase in salary per
annum. Through the years, the company has also recognized and commended
him for his dedication to his work.[2] He has actively articulated the
employees' concerns and, since 1990, has written to the management about
the malpractices committed by some officers of a "five-six" loan system in
their workplace operated by some of its officers.[3] He incurred the ire of
respondent's manager Mr. Antonio Altavano who operated the usurious
transactions.
In April 1991, respondent charged petitioner with four (4) violations of

company policies, all allegedly committed on March 19, 1991. It started at
about 11:00 a.m. when petitioner allegedly left his workplace without
permission. He was charged with loafing and abandonment of work.
ISSUE:
Whether or not the petitioner was dismissed from service without just
cause?
HELD:
Reinstatement is the remedy that most effectively restores the right of
an employment before he was unjustly deprived of his job. In giving an
illegally dismissed employee the right to reinstatement, the law[1] recognizes
the fact that continued employment gives to a worker, especially to a lowly or
menial laborer, an assurance of continuity in his source of income which a
grant of separation pay could not provide. In the case at bar, we give primacy
to the employee's right to reinstatement rather than the employers claim that
due to "strained relationship," his illegally dismissed employee should just be
given separation pay.
ST. THERESA’S SCHOOL OF NOVALICHES FOUNDATION and

ADORACION ROXAS vs.NATIONAL LABOR RELATIONS
COMMISSION and ESTHER REYES
FACTS:
Justice is to be denied to none. The law, while protecting the rights of
the employees, authorizes neither the oppression nor destruction of the
employer. When the law angles the scale of justice in favor of labor, the scale
should never be so tilted if the result is an injustice to the employer.[2]
Petitioners contend that the public respondent acted with grave abuse of
discretion amounting to lack or excess of jurisdiction in handing down its
disposition wherein, notwithstanding the finding that the dismissal of private
respondent was valid, it awarded back wages for the latter, computed from
November 12, 1993 up to the time of rendition of the decision under attack.
On April 5, 1994, when no action was taken by the Labor Arbiter on her
motion, she filed a Motion for Immediate Resolution, and, on July 13, 1994,
after three months, still without any action taken by the same Labor Arbiter
on her yearning, the private respondent sent in a second Motion for Immediate
Resolution. However, Labor Arbiter Raul T. Aquino was appointed as
Commissioner of the NLRC, thereby leaving subject motions of private
respondent unresolved.
ISSUE:
Whether or not the back wages of the private respondent, whose
dismissal has been upheld with finality
HELD:
We now tackle the pivotal point of inquiry - the award of back wages
in favor of private respondent. It proper in light of the finding that her
dismissal was valid. The term “back wages” has been defined as that for
earnings lost by a worker due to his illegal dismissal. Back wages are
generally granted on grounds of equity. Payment thereof is a form of relief
that restores the income lost by reason of such unlawful dismissal.
AURORA LAND PROJECTS CORP. vs. NATIONAL LABOR RELATIONS

COMMISSION
FACTS:
Private respondent Honorio Dagui was hired by Doña Aurora
Suntay Tanjangco in1953 to take charge of the maintenance and
repair of the Tanjangco apartments and residential buildings. He was
to perform carpentry, plumbing, electrical and masonry work. Upon
the death of Doña Aurora Tanjangco in 1982, her daughter,
p e t i t i o n e r Te r e s i t a Ta n ja n g c o Qu a z o n , t o o k o v e r t h e a d mi n i s
t r a t i o n o f a l l t h e Tanjangco properties.
On June 8, 1991, private respondent Dagui received the shock of his

life when Mrs. Quazon suddenly told him: "Wala ka nang trabaho
mula ngayon," on the alleged ground that his work was unsatisfactory.
O n M a y 2 5 , 1 9 9 2, L a b o r A r b i t e r r e n d e r e d ju d g me nt , r e s
p o n d e n t s Au r o r a P l a z a and/or Teresita Tanjangco Quazon are
hereby ordered to pay the complainant the t o t a l a mo u n t o f
P195,624.00, representing complainant's separation pay and the ten(10%)
percent attorney's fees within ten (10) days from receipt of this
Decision.Aggrieved.
ISSUES:
Whether or not private respondent Honorio Da
g u i w a s a n e m p l o y e e o f petitioners?
HELD:
Petitioners insist that private respondent had never been their employee.
Since the establishment of Aurora Plaza, Dagui served therein only as a job
contractor. Dagui, by the findings of both tribunals, was an employee of the
petitioners.
OSMALIK S. BUSTAMANTE vs. NATIONAL LABOR RELATIONS

COMMISSION, FIFTH DIVISION and EVERGREEN FARMS, INC.
FACTS:
Private respondent now moves to reconsider the decision on grounds
that (a) petitioners are not entitled to recover back wages because they were
not actually dismissed but their probationary employment was not converted
to permanent employment; and (b) assuming that petitioners are entitled to
back wages, computation thereof should not start from cessation of work up
to actual reinstatement, and that salary earned elsewhere (during the period of
illegal dismissal) should be deducted from the award of such back wages.
There is no compelling reason to reconsider the decision of the Court

(First Division) dated 15 March 1996. However, we here clarify the
computation of back wages due an employee on account of his illegal
dismissal from employment .In accordance with these provisions, back pay
(the same as back wages) could be awarded where, in the opinion of the Court
of Industrial Relations (CIR) such was necessary to effectuate the policies of
the Industrial Peace Act.[1] Only in one case was back pay a matter of right,
and that was, when an employer had declared a lockout without having first
bargained collectively with his employees in accordance with the provisions
of the Act.
ISSUE:
Whether or not the reinstatement of the petitioners is feasible
HELD:
Therefore, in accordance with R.A No. 6715, petitioners are entitled to
their full back wages, inclusive of allowances and other benefits or their
monetary equivalent, from the time their actual compensation was withheld
from them up to the time of their actual reinstatement.
As to reinstatement of petitioners, this Court has already ruled that since

reinstatement is no longer feasible, because the company would be unjustly
prejudiced by the continued employment of petitioners who at present are
overage, a separation pay equal to one-month salary granted to them in the
Labor Arbiter's decision was in order.
INSULAR LIFE VS. NLRC
Facts:
Insular Life (company) and Basiao entered into a contract by which
Basiao was authorized to solicit for insurance in accordance with the rules of
the company. He would also receive compensation, in the form of
commissions. The contract also contained the relations of the parties, duties
of the agent and the acts prohibited to him including the modes of
termination.After 4 years, the parties entered into another contract – an
Agency Manager’s Contact – and to implement his end of it, Basiao organized
an agency while concurrently fulfilling his commitment under the first
contract. The company terminated the Agency Manager’s Contract. Basiao
sued the company in a civil action. Thus,the company terminated Basiao’s
engagement under the first contract and stopped payment of his commissions.
ISSUE:
whether or not Basiao had become the company’s employee by virtue
of the contract, thereby placing his claim for unpaid commissions
HELD:
Rules and regulations governing the conduct of the business are
provided for in the Insurance Code. These rules merely serve as guidelines
towards the achievement of the mutually desired result without dictating the
means or methods to be employed in attaining it. Its aim is only to promote
the result, thereby creating no employer-employee relationship. It is usual and
expected for an insurance company to promulgate a set of rules to guide its
commission agents in selling its policies which prescribe the qualifications of
persons who may be insured. None of these really invades the agent’s
contractual prerogative to adopt his own selling methods or to sell insurance
at his own time and convenience, hence cannot justifiable be said to establish
an employer-employee relationship between Basiao and the company. The
respondents limit themselves to pointing out that Basiao’s contract with the
company bound him to observe and conform to such rules. No showing that
such rules were in fact promulgated which effectively controlled or restricted
his choice of methods of selling insurance. Therefore, Basiao was not an
employee of the petitioner, but a commission agent, an independent contract
whose claim for unpaid commissions should have been litigated in an ordinary
civil action.
Wherefore, the complaint of Basiao is dismissed.
PARAMOUNT VINYL PRODUCTS CORPORATION vs. NATIONAL

LABOR RELATIONS COMMISSION AND PARAMOUNT
INDEPENDENT WORKERS UNION.
FACTS:
On September 23, 1983, the Labor Arbiter in NLRC-NCR Case No. 5-
2328-83 declared petitioner guilty of unfair labor practices for illegaly
shutting-down operations at its Valenzuela plant and locking out its workers
on January 3, 1983, in violation of the existing collective bargaining
agreement and Batas Pambansa Blg. 130.
Petitioner interposed an appeal to the NLRC, but the Labor Arbiter's

decision was affirmed on August 13, 1984. Petitioner then filed a petition for
a writ of certiorari with this Court, which was dismissed on December 10,
1984 for lack of merit.
On April 29, 1985, the UNION filed with the Labor Arbiter an "Urgent
Motion and Manifestation", seeking to expedite the issuance of a writ of
execution. The motion contained a computation of backwages and other
employment benefits due to about two hundred (200) union members.
ISSUE:
Whether or not there was grave abuse of discretion on the part of the
NLRC?
HELD:
Considering the foregoing, the Court finds no legal infirmity tainting
the Labor Arbiter's order of November 27, 1985 which excluded the names of
the fifty (50) union members from the list of employees entitled to back wages
and reinstatement, and which limited the period for computing the back wages
due to the five (5) union members. It bears emphasizing that the execution
proceedings below were undertaken precisely to facilitate the Identification of
each union member entitled, under the decision, to back wages and
reinstatement, the computation of the exact amount due to these members, and
the consideration of supervening events which affect the manner and extent
of the execution.
FILOMENO N. LANTION, CLARITA C. LANTION, and JUANA C.

FUENTES, vs. NATIONAL LABOR RELATIONS COMMISSION,
GREGORIO ARANETA UNIVERSITY FOUNDATION and OBED
JOSE MENESES,
FACTS:
In particular, this Petition for Certiorari seeks a reversal of the Decision
of public respondent National Labor Relations Commission (NLRC), dated
20 January 1988, which modified the judgment of the Labor Arbiter in the
Illegal Dismissal Case entitled "Filomeno N. Lantion et als. vs. Gregorio
Araneta University Foundation et als." in NLRC Case No. NCR-3-98185.
Petitioners maintain that their positions were not affected by the
reorganization program; that they were not re-hired despite their seniority in
service, superior qualifications, and efficiency; that petitioner, Clarita Lantion
was replaced by a faculty member who does not even possess the necessary
academic qualification required by the University and the Ministry of
Education; that petitioner, Juana Fuentes, was replaced by an undergraduate
and very much her junior in terms of service; that their dismissal was
motivated by vindictiveness since petitioner, Filomeno, had previously
testified in the administrative charge against respondent Meneses; that
petitioners were illegally dismissed without the one-month notice and are
entitled to their monetary claims and reinstatement without loss of seniority
rights and with full back wages.
ISSUE:
Whether or not the petitioners is illegally dismissed
HELD:
As to the award by the Labor Arbiter of 10% interest on the retirement
pay, respondent NLRC did not err in deleting it for lack of legal basis. There
is no showing that private respondents were motivated by ill-feeling or bad
faith. Respondents had effected partial payments of petitioners' retirement
benefits even before the filing of this case except that payment could not be
made in full due to financial constraints. An additional monetary burden may
only exacerbate the University's inability to meet its monetary obligations due
to its precarious financial state.
PAL vs NLRC
Facts:
The Philippine Airlines, Inc. (PAL) completely revised its 1966 Code
of Discipline. Subsequently, some of the employees were subjected to
disciplinary measures for alleged violation of revised code. Philippine
Airlines Employees Association (PALEA) filed a complaint before the
(NLRC) for "ULP with arbitrary implementation of PAL's Code of Discipline
without notice and prior discussion with Union by Management." PALEA
contended that PAL was guilty of ULP because the copies of the Code had
been circulated in limited numbers; that being penal in nature the Code must
conform with the requirements of sufficient publication, and that the Code
was arbitrary, oppressive, and prejudicial to the rights of the employees. PAL
filed a “motion to dismiss” the complaint, asserting its prerogative as an
employer to prescribe rules and regulations regarding employees' conduct in
carrying out their duties and functions.
Issue:
Whether or not the formulation of a Code of Discipline among
employees is a shared responsibility of the employer and the employees.
Held:
YES. The Court upheld the union’s right, and ruled that, the
management should see to it that its employees are at least properly informed
of its decisions or modes of action, because the implementation of the
provisions may result in the deprivation of an employees means of livelihood
which is a property right. And the CBA may not be interpreted as cession of
employees right to participate in the deliberation of matters which may affects
their rights and the formulation of a code of discipline.
FEDERITO B. PIDO, vs. NATIONAL LABOR RELATIONS

COMMISSION
FACTS:
On January 21, 2000, petitioner had an altercation with Richard
Alcantara of the ASF, arising from a statement of Alcantara that petitioner’s
security license for his .38 caliber revolver service firearm and duty detail
order had already expired. Alcantara filed a complaint for Gross Misconduct,
recommended that petitioner be relieved from his post, and that immediate
disciplinary action against him be taken.
As more than nine months had elapsed since the investigation was
conducted by respondent with no categorical findings thereon made,
petitioner filed on October 23, 2000 a complaint for illegal constructive
dismissal, illegal suspension, and non-payment and underpayment of salaries,
holiday pay, rest day, service incentive leave, 13th month pay, meal and travel
allowance and night shift differential against respondent, along with its
employee Rosario K. Balais who was allegedly responsible for running the
day to day affairs of respondent’s business. The Labor Arbiter ruled for
separation pay. The NLRC, on appeal, ruled reinstatement without granting
the other monetary claims. The ruling of the NLRC was affirmed by the Court
of Appeals, hence the petition with the Supreme Court.
ISSUE:
Whether the petitioner’s nine-month suspension is tantamount to constructive

dismissal?
HELD:
It is gathered that respondent intended to put petitioner under
preventive suspension for an indefinite period of time pending the
investigation of the complaint against him. The allowable period of
suspension in such a case is not six months but only 30 days, following
Sections 8 and 9 of Rule XXIII, Book V of the Omnibus Rules Implementing
the Labor Code (Implementing Rules),
At the time petitioner filed the complaint for illegal suspension and/or
constructive dismissal on October 23, 2000, petitioner had already been
placed under preventive suspension for nine months.
The Supreme Court ruled that the preventive suspension which lasted
for nine months amounted to constructive dismissal.
REYNALDO VALDEZ, vs. NATIONAL LABOR RELATIONS

COMMISSION and NELBUSCO, INC.,
FACTS:
This special civil action for certiorari challenges the decision of the
National Labor Relations Commission (NLRC), promulgated on December
13, 1995, dismissing petitioner’s complaint and thereby reversing the decision
of the Labor Arbiter dated September 15, 1994, as well as the former’s
resolution of March 15, 1996 which denied petitioner’s motion for
reconsideration.[1] Auspiciously, there is no substantial dispute on the
antecedents of this case.
On June 15, 1993, petitioner filed a complaint against private
respondent for illegal dismissal, with money claims for labor standard
benefits, and for reimbursement of his bond and tire deposit. He claimed that
the reason why respondent company did not allow him to drive again was due
to his refusal to sign an undated company-prepared resignation letter and a
blank affidavit of quitclaim and release.
ISSUE:
Whether or not the decision of the NLRC is substantial on the dismissal
of the complaint?
HELD:
It is true that since private respondent operated a fleet of buses, its entire
business operations were not suspended, whether we speak of either a bona
fide suspension or not. However, as already stated, the principle underlying
that provision which puts six months as a defining cutoff period can be used
as a consonant basis in determining the reasonableness of the length of time
when petitioner could be deprived of work for causes imputable to private
respondent.
Thus, it being clearly established that herein petitioner was

constructively dismissed, the decision of the Labor Arbiter awarding him back
wages and separation pay in lieu of reinstatement, plus the refund of his cash
bond and tire deposit, is definitely in order.
AGRO COMMERCIAL SECURITY SERVICES AGENCY, INC.,

vs. THE NATIONAL LABOR RELATIONS COMMISSION, HON.
LABOR ARBITER BIENVENIDO V. HERMOGENES and MANUEL
JIMENEZ. ET AL.
FACTS:
On January 20, 1988 of public respondent National Labor Relations
Commission (NLRC) affirming the decision of public respondent labor arbiter
Bienvenido V. Hermogenes dated March 19, 1987 finding private respondents
to have been illegally dismissed and ordering petitioner to pay them separation
pay of one-half (1/2) month salary for every year of service, 13th month pay
for the year 1986 and the money value of their respective service incentive
leave amounting to fifteen (15) days salary each with allowances.
Petitioner's service contracts with various corporations and government

agencies to which private respondents were previously assigned had been
terminated generally due to the sequestration of the said offices by the
Presidential Commission on Good Government. Accordingly, many of the
private respondents were placed on "floating status" on September 16, 1986.
ISSUE:
Whether or not there is the so-called "floating status" of a security guard
lawful and could such prolonged status amount to illegal dismissal?
HELD:
In this case, it appears that twenty-seven (27) of the private respondents
violated this rule by accepting employment in other security agencies without
previously resigning from employment with petitioner. No doubt, this is a just
cause for termination of their services and as such they are not entitled to any
separation pay. 5
The "floating status" of such an employee should last only for a

reasonable time. In this case, respondent labor arbiter correctly held that when
the "floating status" of said employees lasts for more than six (6) months, they
may be considered to have been illegally dismissed from the service. Thus,
they are entitled to the corresponding benefits for their separation.
PHILIPPINE WIRELESS INC. (Pocketbell) and/or JOSE LUIS

SANTIAGO vs. NATIONAL LABOR RELATIONS COMMISSION and
GOLDWIN LUCILA
FACTS:
On January 8, 1976, petitioner Philippine Wireless Inc. hired
respondent Doldwin Lucila as operator/encoder. On January 7, 1979, he was
promoted as Head Technical and Maintenance Department of the Engineering
Department. On September 11, 1987, he was promoted as Supervisor,
Technical Services of the same department. On October 1, 1990, he was again
promoted as Superintendent, Project Management.
On June 29, 1992, Labor Arbiter Benigno Villarente Jr. rendered a

decision declaring that respondent actually resigned and dismissed the
complaint for lack of merit
On June 15, 1993, public respondent NLRC reversed the findings of the
labor arbiter, and ordered respondent’s reinstatement with back wages or
separation pay.
On August 27, 1993, petitioners filed a motion for reconsideration

which the National Labor Relations Commission denied for lack of merit in
a resolution dated November 16, 1993.
ISSUE:
Whether or not petitioner was constructively dismissed from the
petitioner’s employment
HELD:
The Court has held that constructive dismissal is “an involuntary
resignation resorted to when continued employment is rendered impossible,
unreasonable or unlikely; when there is a demotion in rank and/or a
diminution in pay; or when a clear discrimination, insensibility or disdain by
an employer becomes unbearable to the employee.”[4] In this particular case,
respondent voluntarily resigned from his employment. He was not pressured
into resigning.
Voluntary resignation is defined as the act of an employee who “finds

himself in a situation where he believes that personal reasons cannot be
sacrificed in favor of the exigency of the service and he has no other choice
but to disassociate
FRANCISCO SORIANO, JR, vs. NATIONAL LABOR RELATIONS

COMMISSION and PHILIPPINE LONG DISTANCE TELEPHONE
COMPANY, INCORPORATED
FACTS:
In its Decision and Resolution, the NLRC affirmed the Decision of
Labor Arbiter Joel S. Lustria (Labor Arbiter Lustria) dated 23 March 2000 in
NLRC-NCR Case No. 00-08-05259-966 dismissing the petitioner’s complaint
for illegal dismissal against respondent Philippine Long Distance Telephone
Company, Incorporated.
In 1980, petitioner and certain individuals namely Sergio Benjamin

(Benjamin), Maximino Gonzales (Gonzales), and Noel Apostol (Apostol)
were employed by the respondent as Switchman Helpers in its Tondo
Exchange Office (TEO). After participating in several trainings and seminars,
petitioner, Benjamin, and Gonzales were promoted as Switchmen. Apostol,
on the other hand, was elevated to the position of Frameman.
Petitioner, Benjamin, Gonzales, and Apostol filed a Motion for

Reconsideration of the NLRC Decision but the same was denied for lack of
compelling reason in the Resolution dated 28 October 2002.
ISSUE:
Whether or not the petitioner’s complaint for illegal dismissal against
respondent is correct?
HELD:
Finally, it should be noted that the ruling of Labor Arbiter Lustria
sustaining the validity of petitioner’s dismissal from work by reason of a valid
redundancy program was affirmed by the NLRC and the Court of Appeals.
As heretofore discussed, their findings were predicated on the evidence on
records and prevailing jurisprudence. It is well-established that the findings of
the Labor Arbiter, the NLRC and the Court of Appeals, when in absolute
agreement, are accorded not only respect but even finality as long as they are
supported by substantial evidence.54 We find no compelling reason to depart
from this principle.
Oriental Ship Management Co., petitioner vs Court of Appeal,

respondent
FACTS:
Petitioner Oriental Ship management Co., Inc. (Oriental, for brevity) is
a recruitment agency duly licensed by the Philippine Overseas Employment
Administration (POEA) to recruit seafarers for employment on board vessels
accredited to it. Kara Seal Shipping Co., Ltd. (Kara Seal, for brevity) is
petitioner’s foreign-based principal, which owns and manages M/V Agios
Andreas, a vessel accredited to petitioner.
Respondents Felicisimo Cuesta and Wilfredo Gonzaga were hired in the latter
part of 1998 as Third Engineers on board M/V Agios Andreas for a one-year
contract with a monthly salary of nine hundred US dollars (US$900). It was
through Oriental that Kara Seal hired them.
ISSUE:
Whether or not the respondent has the right to received quitclaim?
HELD:
Settled is the rule that quitclaims are ineffective in barring full recovery
of the benefits due the employee. The acceptance of any monetary benefit,
such as repatriation expenses and accrued wages in this case, would not divest
respondents of the right to fully claim the remainder of what is rightfully due
them.
AZCOR MANUFACTURING INC., FILIPINAS PASO vs. NATIONAL

LABOR RELATIONS COMMISSION (NLRC) AND CANDIDO
CAPULSO
FACTS:
Candido Capulso filed with the Labor Arbiter a complaint for
constructive illegal dismissal and illegal deduction of P50.00 per day for the
period April to September 1989. Petitioners Azcor Manufacturing, Inc.
(AZCOR) and Arturo Zuluaga who were respondents before the Labor Arbiter
(Filipinas Paso was not yet a party then in that case) moved to dismiss the
complaint on the ground that there was no employer-employee relationship
between AZCOR and herein respondent Capulso; that the latter became an
employee of Filipinas Paso effective 1 March 1990 but voluntarily resigned
therefrom a year after. Capulso later amended his complaint by impleading
Filipinas Paso as additional respondent before the Labor Arbiter.
On 14 January 1992, Labor Arbiter Felipe T. Garduque II denied the

motion to dismiss holding that the allegation of lack of employer-employee
relationship between Capulso and AZCOR was not clearly
established. Thereafter, the Labor Arbiter ordered that hearings be conducted
for the presentation of evidence by both parties.
ISSUE:
Whether or not the NLRC committed grave abuse of discretion in
declaring that private respondent
HELD:
As a rule, the original and exclusive jurisdiction to review a decision
or resolution of respondent NLRC in a petition for certiorari under Rule 65
of the Rules of Court does not include a correction of its evaluation of the
evidence but is confined to issues of jurisdiction or grave abuse of discretion.
However, considering that private respondent died during the pendency

of the case before this Court, reinstatement is no longer feasible. In lieu
thereof, separation pay shall be awarded. With respect to the amount of back
wages, it shall be computed from the time of private respondent’s illegal
dismissal up to the time of his death.
METRO TRANSIT ORGANIZATION, INC., petitioner, vs. NATIONAL

LABOR RELATIONS COMMISSION and RAMON M.
GARCIA, respondents.
FACTS:
Private respondent Ramon M. Garcia started working with petitioner
Metro Transit Organization (METRO) as a station teller in November 1984.
On 22 April 1992 he called up the office of METRO and asked his
immediate supervisor Carlos Limuaco if he could go on leave of absence as
he was proceeding to Cebu to look for his wife and children who suddenly left
home without his knowledge. After a few weeks of fruitless search he returned
to Manila.
When he reported to the office on 15 May 1992 Garcia was not allowed
to resume work but was directed by his section head, Felix Leyson, to proceed
to the legal department of METRO where he would undergo
investigation. There he was asked by one Noel Pili about his absence from
work. Still in a state of extreme agitation and weighed down by a serious
family problem, Garcia at once prepared a resignation letter. Then he left
again for the province to look for his family. But like his first attempt his
effort came to naught. Soon after, or on 4 June 1992, the Personnel
Committee of METRO approved his resignation.
ISSUE:
Whether or not the respondent tenders his resignation or is terminated
for his absence?
HELD:
The Court has always held that the factual findings arrived at by a trier
of facts who is uniquely positioned to observe the demeanor of the witnesses
appearing before him and is most competent in judging the credibility of the
contending parties are accorded great weight and certitude. In the instant case,
we find nothing irrational or wayward in the affirmation by the NLRC that
Garcia was forced to resign thus was illegally dismissed.
There is therefore nothing to correct in the questioned act of the

NLRC. This circumstance obtaining, certiorari does not lie. Petitioner could
have fairly settled the problem of its employee and avoided litigation had it
listened judiciously to the former's explanation for his absences. An employer
may have to bend a little backwards if only to accommodate an employee who
is heavily burdened with a grave family crisis. For it is worth remembering
that the objectives of social justice can be realized only if employers in
appropriate situations extend their hand to their employees in dire need of
help.
Shie Jie Cor[poration/Seastar Ex-im Corporation vs. National

Federation of Labor (2005)
FACTS:
Respondents, in their complaint, alleged that they were employed as
fish processors by petitioners.[3] On July 20, 1998, Sammy Yang and Michael
Yang, petitioners, confronted them about their union activities. Immediately,
they were ordered to go home. The next day, petitioners suspended them for
one week effective July 22 to 28, 1998. Upon their return, they were served
with a notice of petitioners’ memorandum terminating their services for
abandonment of work.
Petitioners, in their answer, denied respondents’ allegations. They

claimed that on July 20, 1998, about 2:45 o’clock in the afternoon, 13 rank-
and-file employees staged a walk-out and abandoned their work. Among
them were respondents Wilfredo Toribio, Nida Toribio, Yolanda
Lorenzo, Sorraya Amping, Vivian Mendoza, Merylene Delos Reyes, Arnold
Francisco, and Manuel Francisco. As a consequence, petitioners’ business
operations were interrupted and paralyzed, prompting them to issue a
memorandum suspending respondents for one week or from July 22 to 28,
1998. Instead, respondents Ernesto Etrata, Sorraya Amping, Yasher Taning,
Yolanda Lorenzo, Merylene Delos Reyes, and Wilfredo Toribio submitted
their resignation letters and quitclaims.
ISSUE:
Whether or not the Court of Appeals erred in holding that petitioners
failed to prove by substantial evidence that respondents voluntarily resigned
and/or abandoned their work
HELD:
Voluntary resignation is defined as the act of an employee, who finds
himself in a situation in which he believes that personal reasons cannot be
sacrificed in favor of the exigency of the service; thus, he has no other choice
but to disassociate himself from his employment.[5] Acceptance of a
resignation tendered by an employee is necessary to make the resignation
effective.[6] No such acceptance, however, was shown in the instant case.
HEIRS OF IGNACIA AGUILAR-REYES, vs. COURT OF APPEAL,
FACTS:
Assailed in this petition for review on certiorari are the January 26,
2000 Decision and June 19, 2000, Resolution of the Court of Appeals in CA-
G.R. No. 28464 which declared respondents as purchasers in good faith and
set aside the May 31, 1990 and June 29, 1990 Orders of the Regional Trial
Court of Quezon City, Branch 101, in Civil Case No. Q-48018.
In the case at bar, there is no dispute that Lot No. 4349-B-2, is a

conjugal property having been purchased using the conjugal funds of the
spouses during the subsistence of their marriage. It is beyond cavil therefore
that the sale of said lot to respondent spouses without the knowledge and
consent of Ignacia is voidable. Her action to annul the March 1, 1983 sale
which was filed on June 4, 1986, before her demise is perfectly within the 10
year prescriptive period under Article 173 of the Civil Code.
ISSUE:
Whether or not the respondent a purchaser in good faith?
HELD:
A purchaser in good faith is one who buys property of another, without
notice that some other person has a right to, or interest in, such property and
pays full and fair price for the same, at the time of such purchase, or before he
has notice of the claim or interest of some other persons in the property. He
buys the property with the belief that the person from whom he receives the
thing was the owner and could convey title to the property. A purchaser
cannot close his eyes to facts which should put a reasonable man on his guard
and still claim he acted in good faith.[38]
INTERTROD MARITIME, INC. and TROODOS SHIPPING

CO., petitioners,
vs. NATIONAL LABOR RELATIONS COMMISSION and ERNESTO
DE LA CRUZ, respondents.
FACTS:
On 10 May 1982, private respondent Ernesto de la Cruz signed a
shipboard employment contract with petitioner Troodos Shipping Company
as principal and petitioner Intertrod Maritime, Inc., as agent to serve as Third
Engineer on board the M/T "BREEDEN" for a period of twelve (12) months
with a basic monthly salary of US$950.00. 1
Private respondent eventually boarded a sister vessel, M/T "AFAMIS"

and proceeded to work as the vessel's Third Engineer under the same terms
and conditions of his employment contract previously referred to.
On 26 August 1982, while the ship (M/T "Afamis") was at Port Pylos,
Greece, private respondent requested for relief, due to "personal reason." 3 The
Master of the ship approved his request but informed private respondent that
repatriation expenses were for his account and that he had to give thirty (30)
days notice in view of the Clause 5 of the employment contract so that a
replacement for him (private respondent) could be arranged.
ISSUE:
Whether or not complainant's termination is illegal?
HELD:
Private respondent claims that his request for relief was only for the
reason of taking care of a fellow member of the crew so much so that when
he was not allowed to disembark in Port Pylos, Greece, the reason no longer
existed and, therefore, when he was forced to "sign off" at Port Said, Egypt
even when he signified intentions of continuing his work, he was illegally
dismissed. 15 We sympathize with the private respondent; however, we cannot
sustain such contention. The decision of the NLRC is therefore set aside.
REYNALDO VALDEZ, petitioner, vs. NATIONAL LABOR

RELATIONS COMMISSION and NELBUSCO, INC.,respondents.
FACTS:
Private respondent operated a fleet of buses, its entire business
operations were not suspended, whether we speak of either a bona
fide suspension or not. However, as already stated, the principle underlying
that provision which puts six months as a defining cutoff period can be used
as a consonant basis in determining the reasonableness of the length of time
when petitioner could be deprived of work for causes imputable to private
respondent.
In the instant case, the reason for the stoppage of operation of the bus
assigned to petitioner was the breakdown of the airconditioning unit, which is
a valid reason for the suspension of its operation. However, such suspension
regarding that particular bus should likewise last only for a reasonable period
of time.[7] The defect in the airconditioning unit could have been easily
remedied by private respondent. The period of six months was more than
enough for it to cause the repair thereof. Beyond that period, the stoppage of
its operation was already legally unreasonable and economically prejudicial
to herein petitioner who was not given a substitute vehicle to drive.
ISSUE:
Whether or not the resignation of the respondent is inconsistent with
the filing of the complaint
HELD:
Resignation is defined as the voluntary act of an employee who finds
himself in a situation where he believes that personal reasons cannot be
sacrificed in favor of the exigency of the service, and, that he has no other
choice but to disassociate himself from his employment. Resignation is a
formal pronouncement of relinquishment of an office. It must be made with
the intention of relinquishing the office accompanied by an act of
relinquishment.
Thus, it being clearly established that herein petitioner was

constructively dismissed, the decision of the Labor Arbiter awarding him back
wages and separation pay in lieu of reinstatement, plus the refund of his cash
bond and tire deposit, is definitely in order.
WILLI HAHN ENTERPRISES and/or WILLI HAHN, vs. LILIA R.

MAGHUYOP,
FACTS:
Sometime in 1982, respondent Lilia Maghuyop was hired by petitioner
Willi Hahn as nanny of one of his sons. In 1986, she was employed as
salesclerk of Willi Hahn Enterprises (Ali Mall, Cubao branch), an authorized
dealer of sporting goods, guns and ammunitions. In 1996, she was promoted
as store manager of its branch in Shoe Mart (SM) Cebu, with a monthly salary
of P8,240.00.
On February 25, 1998, petitioner conducted an Inventory Report and

discovered that its SM Cebu branch incurred stock shortages and non-
remittances in the total amount of P27,727.39.[4] In the latter part of July 1998,
petitioner decided to terminate the services of respondent, however, before he
could do so, the latter tendered her resignation. Believing the good faith of
respondent in resigning, petitioner decided not to file charges against her
anymore.
On the other hand, respondent claimed that on July 22, 1998, while she
was in SM Cebu branch, she was approached by Tony Abu and Cesar Araneta
who ordered her to close shop and to write a letter to Mr. and Mrs. Hahn
thanking them for the years she had been in their employ and for all the
benefits she received from them.
ISSUE:
Whether or not the respondent filing of illegal dismissal is a mere
afterthought?
HELD:
The rule that the filing of a complaint for illegal dismissal is
inconsistent with resignation is not applicable to the instant case. The filing
of an illegal dismissal case by respondent was evidently a mere
afterthought. It was filed not because she wanted to return to work but to
claim separation pay and back wages.
Hence, we find no reason to deviate from the conclusion of both the

NLRC and the Labor Arbiter that respondent, having tendered a voluntary
resignation was not illegally dismissed.
ENRIQUEZ SECURITY SERVICES INC. vs. CABOTAJE
Facts:
Sometime in January 1979, respondent Victor A. Cabotaje was
employed as a security guard by Enriquez Security and Investigation Agency
(ESIA). On November 13, 1985, petitioner Enriquez Security Services, Inc.
(ESSI) was incorporated. Respondent continued to work as security guard in
petitioner’s agency. On reaching the age of 60 in July 1997, respondent
applied for retirement.
Petitioner acknowledged that respondent was entitled to retirement

benefits but opposed his claim that the computation of such benefits must be
reckoned from January 1979 when he started working for ESIA. It claimed
that the benefits must be computed only from November 13, 1985 when ESSI
was incorporated.
Issue:
Whether or not the benefits must be computed only from November 13,
1985 when ESSI was incorporated.
Held:
The attempt to make the security agencies appear as two separate
entities, when in reality they were but one, was a devise to defeat the law and
should not be permitted. Although respect for corporate personality is the
general rule, there are exceptions. In appropriate cases, the veil of corporate
fiction may be pierced as when it is used as a means to perpetrate a social
injustice or as a vehicle to evade obligations. Petitioner was thus correctly
ordered to pay respondent’s retirement under RA 7641, computed from
January 1979 up to the time he applied for retirement in July 1997.
ALBERTO P. OXALES vs. UNITED LABORATORIES, INC
FACTS:
Sometime in 1959, UNILAB established the United Retirement Plan
(URP). The plan is a comprehensive retirement program aimed at providing
for retirement, resignation, disability, and death benefits of its members. An
employee of UNILAB becomes a member of the URP upon his regularization
in the company. The URP mandates the compulsory retirement of any
member-employee who reaches the age of 60.
Both UNILAB and the employee contribute to the URP. On one hand,
UNILAB provides for the account of the employee an actuarially-determined
amount to Trust Fund A. On the other hand, the employee chips in 2½% of
his monthly salary to Trust Fund B. Upon retirement, the employee gets both
amounts standing in his name in Trust Fund A and Trust Fund B.
Oxales joined UNILAB on September 1, 1968. He was compulsorily

retired by UNILAB when he reached his 60th birthday on September 7, 1994,
after having rendered service of twenty-five (25) years, eleven (11) months,
and six (6) days. He was then Director of Manufacturing Services Group.
ISSUE:
Whether in the computation of his retirement and sick leave benefits,
UNILAB should have factored such benefits like bonuses, cash and meal
allowances, rice rations, service incentive leaves, and 1/12 of the 13th month
pay.
HELD:
A retirement plan in a company partakes the nature of a contract, with
the employer and the employee as the contracting parties. It creates a
contractual obligation in which the promise to pay retirement benefits is made
in consideration of the continued faithful service of the employee for the
requisite period.
The employer and the employee may establish such stipulations,

clauses, terms, and conditions as they may deem convenient.
TORREDA vs. TOSHIBA
FACTS:
Torreda was employed by Toshiba as a finance assistant. His
employment was terminated for grave slander, which under the Employee
Handbook is punishable by dismissal. Torreda filed a complaint for illegal
dismissal against Toshiba.
ISSUE:
Whether or not Torreda was validly dismissed.
HELD:
The dismissal of Torreda is valid. The rule in labor cases is that the
burden is on the employer to prove that the dismissal of an employee is for a
just or valid cause. Evidence must be clear, convincing and free from any
inference that the prerogative to dismiss an employee was abused and unjustly
used by the employer to further any vindictive end. In this case, respondent
Toshiba adequately proved that petitioner was dismissed for just cause.
There is abundant evidence on record showing that petitioner
committed libel against his immediate superior, Sepulveda, an act constituting
serious misconduct which warrants the dismissal from employment; petitioner
having maliciously and publicly imputed on Sepulveda the crime of robbery.
It has been held that the employer’s right to conduct the affairs of his
business, according to its own discretion and judgment, is well-recognized.
An employer has a free reign and enjoys wide latitude of discretion to regulate
all aspects of employment, including the prerogative to instill discipline in its
employees and to impose penalties, including dismissal, upon erring
employees. This is a management prerogative, where the free will of
management to conduct its own affairs to achieve its purpose takes form. The
law, in protecting the rights of workers, authorizes neither oppression nor self-
destruction of the employer.
CONSOLIDATED FOOD CORPORATION/PRESIDENT JOHN
GOKONGWEI, GEN. MGR. VICTORIO FADRILAN, JR., and UNIT
MGR. JAIME S. ABALOS, petitioners, vs. NATIONAL LABOR
RELATIONS COMMISSION AND WILFREDO M.
BARON, respondents.
FACTS:
Petitioner Consolidated Food Corporation (CFC) is a domestic
corporation engaged in the sale of food products, e.g., Presto Ice Cream, with
petitioner John Gokongwei as its President, Victorio V. Fadrilan Jr. as General
Manager, and Jaime S. Abalos as Unit Manager for Northern Luzon.
Private respondent Wilfredo M. Baron was a Bonded Merchandiser at

CFC since November 1985 and received commendations for being a
consistent member of the “millionaires group,” a title given to provincial
salesmen who filled sales quotas in their assigned areas.
In March and December 1989, and February and April 1990, he was
given commendations by Gen. Mgr. Victorio V. Fadrilan Jr. and Unit Mgr.
Jaime S. Abalos for his good performance in sales.[1] Thereafter he was
assigned as Acting Section Manager for Northern Luzon (NL) – 2
Area covering Baguio City, La Trinidad and Benguet. He was tasked, among
others, to deliver for sale CFC Presto Ice Cream products to stores and outlets
in Baguio City, make inventories thereof, replace or retrieve bad orders or
damaged ice cream stocks, and to handle funds in relation to his functions. He
received a basic salary of P3,300.00 per month plus commissions averaging
monthly at P30,000.00 or one percent (1%) of his sales.[2]
ISSUE:
Whether or not the respondent is entitled for 13th month pay?
HELD:
Private respondent is entitled to P687.50 as proportionate 13th month
pay. The circumstances of this case clearly show that the petitioners had
knowledge and allowed the withholding of salaries of private respondent
starting 1 January 1991 up to the time he resigned from his
employment. Therefore, they are held jointly and severally liable to pay
private respondent the amounts indicated above in the total amount
of P8,937.55. Further, private respondent was forced to litigate for the
recovery of his wages, hence, he is entitled to an award of attorney’s fees
of P1,000.00 which amount is reasonable in this case.[17]
ST. MICHAEL’S INSTITUTE, FR. NICANOR VICTORINO and
EUGENIA BLANCO, petitioners, vs. CARMELITA A. SANTOS,
FLORENCIO M.
FACTS:
Petitioner St. Michael’s Institute is an institute of learning located in
Bacoor, Cavite with petitioner Fr. Nicanor Victorino as Director and
petitioner Eugenia Blanco as the Principal and respondents Carmelita Santos,
Florencio Magcamit and Albert Rosarda were regular classroom
teachers. Respondent Santos began teaching at St. Michael’s Institute in 1979
while respondents Magcamit and Rosarda joined its school faculty only in
1990. Their service with the school was abruptly interrupted when each of
them was served a notice of termination of employment on September 20,
1993.[4]
Respondents Magcamit and Rosarda immediately filed on September

21, 1993 a complaint for illegal dismissal against the petitioners.[11] On
October 12, 1993, a second complaint for illegal dismissal was filed by
respondents Magcamit and Rosarda, this time with respondent Santos.[12] Both
complaints were consolidated.
ISSUE:
Whether or not the respondent is liable/correct to get the award of back
wages?
HELD:
Finally, we do not subscribe to the view of the petitioners that payment
of backwages to respondent Santos should be computed only up to December
11, 1993, when respondent Santos reached 60 years of age. It is worth noting
that in their motion for reconsideration before the Court of Appeals,
petitioners merely attached the Service Record and Baptismal Certificate of
respondent Santos to support their contention that under respondent schoo l’s
policy teachers retire upon reaching the age of 60 and, thus, the amount of
backwages to respondent Santos should be up to December 11, 1993 only,
when she reached 60 years of age. The documentary evidence appended to
the instant petition for review by the petitioners, which is not a newly
discovered evidence, to substantiate its view and belated allegation on the
existence of a school policy to retire teachers upon reaching 60 years of age
cannot be considered at this stage.
WESTIN PHILIPPINE PLAZA HOTEL vs. NATIONAL LABOR

RELATIONS COMMISSION (THIRD DIVISION) and LEN
RODRIGUEZ
FACTS:
Private respondent was continuously employed by petitioner in various
capacities from July 1, 1977 until his dismissal on February 16, 1993. Initially
hired as pest controller, he was later posted as room attendant. Next he served
as bellman, until he was finally assigned as doorman in November, 1981, and
stayed in that position until his employment was terminated by petitioner.
On December 28, 1992, private respondent received a memorandum

from the management transferring him from doorman to linen room attendant
in the Housekeeping Department effective December 29, 1992. The position
of doorman is categorized as guest-contact position while linen room
attendant is a non-guest contact position. The transfer was allegedly taken
because of the negative feedback on the manner of providing service to hotel
guests by private respondent.
ISSUE:
Whether or not the order of travel is legal or not?
HELD:
Finally it must be stressed that to sanction the disregard or disobedience
by employees of a reasonable rule or order laid down by management would
be disastrous to the discipline and order within the enterprise. It is in the
interest of both the employer and the employee to preserve and maintain order
and discipline in the work environment. Deliberate disregard of company
rules or defiance of management prerogative cannot be countenanced. This
is not to say that the employees have no remedy against rules or orders they
regard as unjust or illegal.
In the case at bar, private respondent was repeatedly reminded not only
by management but also by his union to report to his work station but to no
avail. His continued refusal to follow a legal order brought on the fit
consequence of dismissal from his position for which management could not
be justly faulted.
BISIG MANGGAGAWA SA TRYCO and/or FRANCISCO SIQUIG, as

Union President, JOSELITO LARIÑO, VIVENCIO B. BARTE,
SATURNINO EGERA and SIMPLICIO AYA-AY, Petitioners, vs
NATIONAL LABOR RELATIONS COMMISSION, TRYCO
PHARMA CORPORATION, and/or WILFREDO, respondent
FACTS:
Tryco Pharma Corporation (Tryco) is a manufacturer of veterinary
medicines and its principal office is located in Caloocan City. Petitioners
Joselito Lariño, Vivencio Barte, Saturnino Egera and Simplicio Aya-ay are its
regular employees, occupying the positions of helper, shipment helper and
factory workers, respectively, assigned to the Production Department. They
are members of Bisig Manggagawa sa Tryco (BMT), the exclusive bargaining
representative of the rank-and-file employees.
In August 1997, petitioners filed their separate complaints[8] for illegal

dismissal, underpayment of wages, nonpayment of overtime pay and service
incentive leave, and refusal to bargain against Tryco and its President,
Wilfredo C. Rivera. In their Position Paper,[9] petitioners alleged that the
company acted in bad faith during the CBA negotiations because it sent
representatives without authority to bind the company, and this was the reason
why the negotiations failed.
ISSUE:
Whether or not the petitioners’ transfer to another workplace did not
amount to a constructive dismissal and an unfair labor practice
HELD:
We cannot see how the mere transfer of its members can paralyze the
union. The union was not deprived of the membership of the petitioners whose
work assignments were only transferred to another location.
Where it is shown that the person making the waiver did so voluntarily,
with full understanding of what he was doing, and the consideration for the
quitclaim is credible and reasonable, the transaction must be recognized as a
valid and binding undertaking.
PETROPHIL CORPORATION, vs. NATIONAL LABOR RELATIONS

COMMISSION, ANSELMO B. ENCARNACION AND GERSHER
ENGINEERING WORKS
FACTS:
Private respondent, Anselmo B. Encarnacion, had been working as a
casual employee of various job contractors in Petrophil's premises since 1963
when the firm was still under the ownership and management of Esso
Standard Philippines. On December 21, 1973, Esso Standard Philippines was
sold to Petrophil Corporation. At that time, Anselmo B. Encarnacion was
working at the bulk plant as an employee of one Juanito Campos who had a
job contract with Esso Standard Philippines. The said job contract was
continued by Petrophil Corporation so respondent Encarnacion remained
working at the bulk plant. In March 1976, respondent Gersher Engineering
Works entered into a service contract with Petrophil and thereafter placed
respondent Encarnacion in its payroll.
Respondent Encarnacion refused to be reassigned to Caltex unless he

was made to occupy the same position of warehouseman as in Petrophil
Corporation and since the position available at Caltex was that of equipment
maintainer, respondent Encarnacion refused to be transferred. Instead he filed
a complaint for illegal dismissal against respondent Gersher and in the
alternative, against petitioner Petrophil Corporation, before the Labor
Relations Division of the then Department of Labor.
ISSUE:
Whether or not the respondent was not dismissed but was only demoted
and transferred to Caltex Phil. Inc.
HELD:
Considering the foregoing, reinstatement of respondent Encarnacion
and payment of his money claims should be made by respondent Gersher
Engineering Works, his employer which has evidently accepted the decision
of the Labor Arbiter by not appealing therefrom Petitioner Petrophil
Corporation is absolved from any and all liability.
DANILO LEONARDO, vs. NATIONAL LABOR RELATIONS

COMMISSION and REYNALDO’S MARKETING CORPORATION,
ET. AL.
FACTS:
Petitioner AURELIO FUERTE was originally employed by private
respondent REYNALDO’S MARKETING CORPORATION on August 11,
1981 as a muffler specialist, receiving P45.00 per day. When he was appointed
supervisor in 1988, his compensation was increased to P122.00 a day,
augmented by a weekly supervisor’s allowance of P600.00. On the other hand,
DANILO LEONARDO was hired by private respondent on March 4, 1988 as
an auto-aircon mechanic at a salary rate of P35.00 per day. His pay was
increased to P90.00 a day when he attained regular status six months later.
On July 1, 1996, LEONARDO, represented by the Public Attorney’s

Office, filed G.R. No. 125303, a special civil action for certiorari assailing
the Commission’s decision and resolution. However, on November 15, 1996,
FUERTE, again joined by LEONARDO, filed G.R. No. 126937, a similar
action praying for the annulment of the same decision and resolution.
ISSUE:
Whether or not RESPONDENT COMMISSIONERS GRAVELY
ABUSED THEIR DISCRETION AMOUNTING TO LACK OR IN EXCESS
OF JURISDICTION WHEN THEY GRANTED RESPONDENTS APPEAL
HELD:
The well-settled rule confines the original and exclusive jurisdiction of
the Supreme Court in the review of decisions of the NLRC under Rule 65 of
the Revised Rules of Court only to the issue of jurisdiction or grave abuse of
discretion amounting to lack of jurisdiction. Grave abuse of discretion is
committed when the judgment is rendered in a capricious, whimsical,
arbitrary or despotic manner. An abuse of discretion does not necessarily
follow just because there is a reversal by the NLRC of the decision of the
Labor Arbiter.
KAMAYA POINT HOTEL vs. NATIONAL LABOR RELATIONS

COMMISSION, FEDERATION OF FREE WORKERS and MEMIA
QUIAMBAO
FACTS:
Respondent Memia Quiambao with thirty others who are members of
private respondent Federation of Free Workers (FFW) was employed by
petitioner as hotel crew. On the basis of the profitability of the company's
business operations, management granted a 14th month pay to its employees
starting in 1979. Although petitioner reopened the hotel premises to the
public, it was not able to pick-up its lost patronage. In a couple of months it
affected a retrenchment program until finally on January 7, 1984, it totally
closed its business.2
On April 18, 1983, private respondent Federation of Free Workers

(FFW); a legitimate labor organization, filed with the Ministry of Labor and
Employment, Bataan Provincial Office, Bataan Export Processing Zone,
Mariveles, Bataan, a complaint against petitioner for illegal suspension,
violation of the CBA and non-payment of the 14th month pay. 3 Records
however show that the case was submitted for decision on the sole issue of
alleged non-payment of the 14th month pay for the year 1982 .
ISSUE:
Whether or not 14th month pay is a management prerogative?
HELD:
Verily, a 14th month pay is a misnomer because it is basically a bonus
and, therefore, gratuitous in nature. The granting of the 14th month pay is a
management prerogative which cannot be forced upon the employer. It is
something given in addition to what is ordinarily received by or strictly due
the recipient. It is a gratuity to which the recipient has no right to make a
demand. This Court is not prepared to compel petitioner to grant the 14th
month pay solely because it has allegedly ripened into a company practice" as
the labor arbiter has put it. Having lost its catering business derived from
Libyan students, Kamaya Hotel should not be penalized for its previous
liberality.
Traders Royal Bank vs NLRC
Facts:
Respondent union filed a letter-complaint against petitioner TRB for
the diminution of benefits being enjoyed by the employees since time
immemorial, e.g. mid-year bonus, from 2 months gross pay to 2 months basic
and year-end bonus from 3 months gross to only 2 months. Petitioner insisted
that it had paid the employees holiday pay. The practice of giving them
bonuses at year’s end, would depend on how profitable the operation of the
bank had been.
NLRC found TRB guilty of diminution of benefits due to the private

respondents and ordered it to pay the said employees’ claims for differentials
in their holiday, mid-year, and year-end bonuses.
Issue:
Whether or not bonuses are part of labor standards?
Held:
No. A bonus is a “gratuity or act of liberality of the giver which the
recipient has no right to demand as a matter of right”. It is something given in
addition to what is ordinarily received by or strictly due the recipient. The
granting of a bonus is basically a management prerogative which cannot be
forced upon the employer “who may not be obliged to assume the onerous
burden of granting bonuses or other benefits aside from the employee’s basic
salaries or wages”.
KIMBERLY-CLARK PHILS vs. DIMAYUGA
FACTS:
Dimayuga was Cost Accounting Supervisor , Gloria was Business
analyst and de Guia was Accounting Manager of Kimberly-Clark. Dimayuga
and Gloria resigned prior to Kimberly-Clark’s offering of early retirement
package. Both pleaded that its benefits be retroactively extended to them. De
Guia also resigned. All were able to benefit from the early retirement
package.
Kimberly-Clark then announced a lump sum retirement pay

subsequently. Dimayuga, Gloria and de Guia filed a claim for this additional
benefit with the NLRC. A decision was made denying Dimayuga and Gloria
of this additional benefit because they ceased to be employees when the lump
sum retirement pay was offered by Kimberly-Clark. De Guia’s lump sum
retirement pay was granted, however, being an employee of Kimberly-Clark
when this benefit was offered.
Appeals were filed in NLRC, which affirmed Dimayuga, Gloria and de

Guia’s claim to the lumps sum retirement pay, ruling that Kimberly-Clark’s
denial to grant Dimayuga and Gloria’s lump sum retirement pay was an act of
discrimination. Kimberly Clark appealed to the Ca which affirmed NLRC’s
decision. Kimberly-clark appealed to the SC contending that Dimayuga and
Gloria signed quitclaims that no longer entitles them to the additional benefits.
ISSUE:
Whether or not Dimayuga and Gloria are entitled to the lump sum
retirement pay.
HELD:
SC decided in favor of Kimberly-Clark on the basis of the absence of
CBA or contract entitling Dimayuga and Gloria to the lump sum retirement
pay. Dimayuga and Gloria resigned prior to the offering of Kimberly-Clark.
The business day doctrine of equal treatment of all employees is misplaced
because it involved resignation and a lump sum retirement pay. Kimberly-
Clark was not even obliged to apply its early retirement package retroactively
to Dimayuga and Gloria. The quitclaims signed by Dimayuga and Gloria
were honored. As for de Guia’s lump sum retirement pay claim, it was denied
because this claim was for employees resigning due to Kimberly-Clark’s
downsizing and not due to career advancement
Sime Darby Pilipinas, Inc. vs. NLRC
Facts:
Sime Darby Pilipinas, Inc., petitioner, is engaged in the manufacture of
automotive tires, tubes and other rubber products. Sime Darby Salaried
Employees Association (ALU-TUCP), private respondent, is an association
of monthly salaried employees of petitioner at its Marikina factory. Prior to
the present controversy, all company factory workers in Marikina including
members of private respondent union worked from 7:45 a.m. to 3:45 p.m. with
a 30 minute paid “on call” lunch break.
Since private respondent felt affected adversely by the change in the

work schedule and discontinuance of the 30-minute paid “on call” lunch
break, it filed on behalf of its members a complaint with the Labor Arbiter for
unfair labor practice, discrimination and evasion of liability pursuant to the
resolution of this Court the Labor Arbiter dismissed the complaint on the
ground that the change in the work schedule and the elimination of the 30-
minute paid lunch break of the factory workers constituted a valid exercise of
management prerogative and that the new work schedule, break time and one-
hour lunch break did not have the effect of diminishing the benefits granted
to factory workers as the working time did not exceed eight (8) hours.
Issue:
Whether or not the act of management in revising the work schedule of
its employees and discarding their paid lunch break constitutive of unfair labor
practice?
HELD:
The Court ruled that the revision of work schedule is a management
prerogative and does not amount to unfair labor practice in discarding the paid
lunch break.
It rationalizes that while the old work schedule included a 30-minute

paid lunch break, the employees could be called upon to do jobs during that
period as they were “on call.” Even if denominated as lunch break, this period
could very well be considered as working time because the factory employees
were required to work if necessary and were paid accordingly for working.
Since the employees are no longer required to work during this one-
hour lunch break, there is no more need for them to be compensated for this
period. The Court agrees with the Labor Arbiter that the new work schedule
fully complies with the daily work period of eight (8) hours without violating
the Labor Code. Besides, the new schedule applies to all employees in the
factory similarly situated whether they are union members or not.
DUNCAN ASSOCIATION OF DETAILMAN-PTGWO and PEDRO A.
TECSON, vs. GLAXO WELLCOME PHILIPPINES, INC
FACTS:
Petitioner Pedro A. Tecson (Tecson) was hired by respondent Glaxo
Wellcome Philippines, Inc. (Glaxo) as medical representative on October 24,
1995, after Tecson had undergone training and orientation.
Thereafter, Tecson signed a contract of employment which stipulates,

among others, that he agrees to study and abide by existing company rules; to
disclose to management any existing or future relationship by consanguinity
or affinity with co-employees or employees of competing drug companies and
should management find that such relationship poses a possible conflict of
interest, to resign from the company.
ISSUE:
1. Whether the Court of Appeals erred in ruling that Glaxo’s policy
against its employees marrying employees from competitor companies is
valid, and in not holding that said policy violates the equal protection clause
of the Constitution?
2. Whether Tecson was constructively dismissed.
HELD:
No reversible error can be ascribed to the Court of Appeals when it
ruled that Glaxo’s policy prohibiting an employee from having a relationship
with an employee of a competitor company is a valid exercise of management
prerogative.
The Court finds no merit in petitioners’ contention that Tecson was

constructively dismissed when he was transferred from the Camarines Norte-
Camarines Sur sales area to the Butuan City-Surigao City-Agusan del Sur
sales area, and when he was excluded from attending the company’s seminar
on new products which were directly competing with similar products
manufactured by Astra. Constructive dismissal is defined as a quitting, an
involuntary resignation resorted to when continued employment becomes
impossible, unreasonable, or unlikely; when there is a demotion in rank or
diminution in pay; or when a clear discrimination, insensibility or disdain by
an employer becomes unbearable to the employee.[30] None of these
conditions are present in the instant case
STAR PAPER CORPORATION, JOSEPHINE ONGSITCO &

SEBASTIAN CHUA, vs. RONALDO D. SIMBOL,WILFREDA N.
COMIA & LORNA E. ESTRELLA
FACTS:
Petitioner Star Paper Corporation (the company) is a corporation
engaged in trading – principally of paper products. Josephine Ongsitco is its
Manager of the Personnel and Administration Department while Sebastian
Chua is its Managing Director.
Respondents offer a different version of their

dismissal. Simbol and Comia allege that they did not resign voluntarily; they
were compelled to resign in view of an illegal company policy. As to
respondent Estrella, she alleges that she had a relationship with co-worker
Zuñiga who misrepresented himself as a married but separated man. After he
got her pregnant, she discovered that he was not separated.
ISSUE:
Whether or not the policy of the employer banning spouses from
working in the same company violates the rights of the employee under the
Constitution and the Labor Code or is a valid exercise of management
prerogative?
HELD:
The contention of petitioners that Estrella was pressured to resign
because she got impregnated by a married man and she could not stand being
looked upon or talked about as immora is incredulous. If she really wanted to
avoid embarrassment and humiliation, she would not have gone back to work
at all. Nor would she have filed a suit for illegal dismissal and pleaded for
reinstatement. We have held that in voluntary resignation, the employee is
compelled by personal reason(s) to dissociate himself from employment. It is
done with the intention of relinquishing an office, accompanied by the act of
abandonment. [44] Thus, it is illogical for Estrella to resign and then file a
complaint for illegal dismissal. Given the lack of sufficient evidence on the
part of petitioners that the resignation was voluntary, Estrella’s dismissal is
declared illegal.
Rolando Rivera vs. Solid Bank Corporation
Facts:
Petitioner Rolando Rivera had been working for Solidbank Corporation
since July 1977. He was initially employed as an Audit Clerk, then as Credit
Investigator, Senior Clerk, Assistant Accountant, and Assistant Manager.
Prior to his retirement, he became the Manager of the Credit Investigation and
Appraisal Division of the Consumer’s Banking Group. In the meantime,
Rivera and his brother-in-law put up a poultry business in Cavite.
In December 1994, Solidbank offered two retirement programs to its

employees: (a) the Ordinary Retirement Program (ORP), under which an
employee would receive 85% of his monthly basic salary multiplied by the
number of years in service; and (b) the Special Retirement Program (SRP),
under which a retiring employee would receive 250% of the gross monthly
salary multiplied by the number of years in service. Since Rivera was only 45
years old, he was not qualified for retirement under the ORP. Under the SRP,
he was entitled to receive P1,045,258.95 by way of benefits.
ISSUE:
Whether or not the post-retirement competitive employment ban is
reasonable
HELD:
The post-retirement competitive employment ban is unreasonable
because it has no geographical limits. The respondent is barred from accepting
any kind of employment in any competitive bank within the proscribed
period.
Retirement plans, in light of the constitutional mandate of affording full

protection to labor, must be liberally construed in favor of the employee, it
being the general rule that pension or retirement plans formulated by the
employer are to be construed against it.
Consideration must be given to the employee’s right to earn a living

and to his ability to determine with certainty the area within which his
employment ban is restituted. A provision on territorial limitation is necessary
to guide an employee of what constitutes as violation of a restrictive covenant
and whether the geographic scope is co-extensive with that in which the
employer is doing business. In considering a territorial restriction, the facts
and circumstances surrounding the case must be considered.
THE PHILIPPINE AMERICAN LIFE AND GENERAL INSURANCE

CO., vs. ANGELITA S. GRAMAJE
FACTS:
Private respondent Philippine American Life and General Insurance
Company is a corporation duly organized and existing under Philippine
laws. Individual respondents occupy the following positions,
namely: Maurice Greenberg, as president of the Company; Jose Cuisia, Jr. as
Chairman of the Board; Maria Haas and Gardon Watson as Regional
Coordinating Pensions Officers, Reynaldo C. Centeno as Executive Vice-
President, Chief Financial Officer and Chief Actuary; and Anthony Sotelo as
the Senior Vice-President and Head of the Human Resources Department.
Petitioner was employed on October 28, 1997 by private respondent as

Assistant Vice President and Head of the Pensions Department and in
concurrent capacity as Trust Officer of Philam Savings Bank, a Philam Life
subsidiary. She was to be paid P750,000.00 per annum and is entitled to the
benefits given by private respondent to its employees.
ISSUE:
Whether or not the respondent constructively dismissed or was her
transfer a legitimate exercise of management prerogative
HELD:
Social justice is “neither communism, nor despotism, nor atomism, nor
anarchy,” but the humanization of laws and the equalization of social and
economic forces by the State so that justice in its rational and objectively
secular conception may at least be approximated. Social justice means the
promotion of the welfare of all the people, the adoption by the Government of
measures calculated to insure economic stability of all the competent elements
of society, through the maintenance of a proper economic and social
equilibrium in the interrelations of the members of the community,
constitutionally, through the adoption of measures legally justifiable, or extra-
constitutionally, through the exercise of powers underlying the existence of
all governments on the time-honored principle of salus populi est suprema
lex.
MARIVAL TRADING, INC., VIRGINIA A. MANUEL and BEATRICE

A. MANUEL, vs. NATIONAL LABOR RELATIONS COMMISSION
(NLRC) and MA. VIANNEY D. ABELLA
FACTS:
The Labor Arbiter ruled and was affirmed by the NLRC, that while the
disorderly behavior of herein private respondent Ma. Vianney D. Abella
(Abella) should not have gone unpunished, such infraction should not be
vested with the extreme penalty of dismissal; thus, he ordered the
reinstatement of Abella to her former position without backwages, as well as
the payment of her proportionate 13th month pay and unpaid salaries for the
year 2000. On Appeal, the Court of Appeals categorically found that Abella’s
misconduct was not as gross as would warrant her dismissal, and awarded her
backwages and attorney’s fees.
On 14 July 2000, Ma. Roxanney A. Manuel (Manuel), Vice President

and General Manager of Marival, conducted a staff meeting together with the
other officers of the company, Gregorio Albeza (Albeza) and Ma. Claire
Distor (Distor), packaging supervisor and importation manager,
respectively. After the meeting, Manuel asked Albeza and Distor to stay
behind to discuss other matters. She requested two male employees to move
some tables and placed Abella’s belongings on one of these
tables. Apparently, while the rearrangement of the tables was going on, Abella
was not in the room. She came in when Manuel, Albeza, and Distor were
already having their own meeting.
ISSUE:
Whether or not a valid cause existed to justify Abella’s dismissal?
HELD:
Dismissal is the ultimate penalty that can be meted to an employee. The
Constitution does not condone wrongdoing by an employee; nevertheless, it
urges a moderation of the sanction that may be applied to him. Where a
penalty less punitive would suffice, whatever missteps may have been
committed by the worker ought not to be visited with a consequence so severe
such as dismissal from employment. For the Constitution guarantees the right
of the workers to “security of tenure.”
VIRGILIO G. ANABE vs. ASIAN CONSTRUCTION

(ASIAKONSTRUKT)
Facts:
The petitioner was hired by respondent Asian Construction
(Asiakonstrukt) as radio technician/operator. His services were terminated on
the ground of retrenchment. He thus filed a complaint for illegal dismissal and
illegal deduction of his pay.
Issue:
Whether or not the petitioner’s dismissal on the ground of retrenchment
was justified
Held:
The SC remanded the case to the NLRC for recomputation of the
monetary award.
Retrenchment is the termination of employment initiated by the

employer through no fault of and without prejudice to the employees. It is
resorted to during periods of business recession and is recognized by Article
283 of the Labor Code
To effect a valid retrenchment, the following elements must be present:

(1) the retrenchment is reasonably necessary and likely to prevent business
losses; (2) the employer serves written notice both to the employee/s
concerned and the Department of Labor and Employment at least a month
before the intended date of retrenchment; (3) the employer pays the retrenched
employee separation pay in an amount prescribed by the Code; (4) the
employer exercises its prerogative to retrench in good faith; and (5) the
employer uses fair and reasonable criteria in ascertaining who would be
retrenched or retained.
In the present case, Asiakonstrukt failed to prove that it was suffering

business losses to warrant a valid retrenchment of its employees and it failed
to submit its audited financial statements within the two years that the case
was pending before the Labor Arbiter. It submitted them only after it received
the adverse judgment of the Labor Arbiter.
VICTORY LINER, INC. vs. PABLO M. RACE
Facts:
In June 1993, respondent was employed by the petitioner as a bus
driver. On the night of 24 August 1994, the bus he was driving was bumped
by a Dagupan-bound bus. As a consequence thereof, respondent suffered a
fractured left leg and was rushed to the Country Medical and Trauma Center
in Tarlac City where he was operated on and confined from 24 August 1994
up to 10 October 1994. One month after his release from the said hospital,
the respondent was confined again for further treatment. Petitioner shouldered
the doctor’s professional fee and the operation, medication and hospital
expenses of the respondent in the aforestated hospitals.
In January 1998, the respondent, still limping heavily, went to the

petitioner’s office to report for work. He was, however, informed by the
petitioner that he was considered resigned from his job. In its Position Paper
dated 27 March 2000, petitioner claimed that the respondent’s cause of action
against petitioner had already prescribed because when the former instituted
the aforesaid complaint on 1 September 1999, more than five years had
already lapsed from the accrual of his cause of action on 24 August 1994.
Issue:
Whether or not the cause of action of respondent has already prescribed.
Held:
The SC held that the cause of action of respondent has not prescribed.
In illegal dismissal cases, the employee concerned is given a period of

four years from the time of his dismissal within which to institute a
complaint. The four-year prescriptive period shall commence to run only
upon the accrual of a cause of action of the worker. It is settled that in illegal
dismissal cases, the cause of action accrues from the time the employment of
the worker was unjustly terminated. Thus, the four-year prescriptive period
shall be counted and computed from the date of the employee’s dismissal up
to the date of the filing of complaint for unlawful termination of employment.
The respondent must be considered as unjustly terminated from work

in January 1998 since this was the first time he was informed by the petitioner
that he was deemed resigned from his work. The respondent’s filing of
complaint for illegal dismissal on 1 September 1999 was well within the four-
year prescriptive period.

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JUANITO A. GARCIA and ALBERTO J. DUMAGO vs.

It settles the view that the Labor Arbiter’s order of reinstatement is

Therefore, all references in the amended Section 9 of B.P No. 129 to

On September 21, 1996, Sec Gen of the Union posted a general

Whether the officers “elected” during the general assembly should be

Yes. Self-organization is a fundamental right guaranteed by the

The Med-Arbiter saw no merit in the INK Employees petition. He

On appeal, Secretary Trajano opined that the petitioners are "bereft

No law, administrative rule or precedent prescribes forfeiture of the

PIGLAS union filed a petition for certification election that

No. The fact that some of respondent PIGLAS union’s members

CENECO filed a motion to dismiss to the effect that "employees who

Thus, member employees of a cooperative may withdraw as members

The NEW ULO, composed mostly of workers belonging to the

TUPAS moved to dismiss the petition for being defective in form

The Med-Arbiter ordered the holding of a certification election

On February 13, 1986, private respondent filed a Petition for

Private respondent filed a petition for certiorari with the Supreme

Art. 244. Coverage and employees’ right to self-organization. — All

The Med-Arbiter rendered a decision dismissing for lack of merit

Petitioner had no valid certificate of registration and therefore no

Med-Arbiter Reynante issued an Order ordering the conduct of

The public respondent, granted respondent company’s Appeal and

Undersecretary Laguesma granted the reconsideration prayed for on

Acting Labor Secretary Nieves Confesor issued a resolution declaring

Confidential employees cannot be classified as rank and file. As

But then in the renewal sought by SCBEU-NUBE, they only wanted

A notice of strike was given to the Department of Labor due to this

With regards to the salary increase of employees in acting capacities,

An opposition to the petition was filed by the Beneco Employees Labor

BENECO formalized its verbal manifestation by filing a Protest. The

The fact that the members-employees of BENECO do not participate

CENECO denied CURE's request on the ground that employees who

CENECO filed a motion to dismiss to the effect that "employees who

Thus, member employees of a cooperative may withdraw as members

Private respondent filed a complaint for illegal dismissal, unfair labor

Labor Arbiter Pelagio A. Carpio rendered his decision dismissing the

On appeal, the NLRC, by a majority vote of Commissioners Guillermo

Dissatisfied, petitioner filed the instant petition.

It was a grave abuse of discretion on the part of public respondent to

Petitioner sought a ruling that the other workers in the proposed

Midarbiter found that there exist an employer-employee relationship

Med-Arbiter Reynante issued an Order ordering the conduct of certification

The public respondent, granted respondent company’s Appeal and ordered

Undersecretary Laguesma granted the reconsideration prayed for on

As a consequence, the union officers should be dismissed for staging

FILOIL REFINERY CORP vs FILOIL EMPLOYEES UNION

Petitioner filed a motion to dismiss the petition on the grounds of lack

Respondent court cast aside petitioner's sedulous objections against the

No arbitrariness or grave abuse of discretion can be attributed against

INDOPHIL TEXTILE MILL WORKERS UNION-PTGWO

Indophil Acrylic Manufacturing Corporation was formed and registered

The petitioner's contention that Acrylic is part of the Indophil bargaining

The public respondent Voluntary Arbitrator did not commit grave

BUENAFLOR C. UMALI, MAURICIA M. VDA. DE CASTILLO,

Mauricia died. Her successor-administratrix, Buenaflor Umali,

San Miguel Corporation employees Union-PTGWO vs. Confessor

KAPISANAN NG MGA MANGGAGAWA SA MANILA

FARLEY FULACHE et. al vs ABS-CBN BROADCASTING

GENERAL RUBBER and FOOTWEAR CORPORATION v. BLR, and

DELA SALLE UNIVERSITY EMPLOYEES ASSOCIATION-

STA. LUCIA EAST COMMERCIAL CORPORATION (SLECC) vs.

PORT WORKERS UNION OF THE PHILS vs LAGUESMA

Sandigan ng Manggagawa sa Daungan (SAMADA) filed a petition