ROYAL INTEROCEAN LINES, ET AL., petitioners, vs. HON.
COURT OF o The bill protects the workers in the process of organization and
INDUSTRIAL RELATIONS, ET AL., respondents.
G.R. No. L11745 | October 31, 1960
FACTS: [ULP]
 Royal Interocean Lines, is a foreign corporation licensed to do business in
the Philippines, with head office in Hongkong. Its branch office in Manila
employed respondent Ermidia A. Mariano who had worked for the
petitioner since January 5, 1932, until her discharge on October 23, 1953.
 October, 1953: the respondent and the manager of the Manila Branch
(Kamerling) developed strained relationship that led the former to
lodge with the managing director in Hongkong a complaint against
Kamerling.
 The latter, with the approval of the head office in Hongkong, dismissed the
respondent on October 23, 1953.
 She charged the petitioner and Kamerling with unfair labor practice
under section 4 (a), subsection 5 Republic Act No. 875
 Court of Industrial Relations held the petitioner and Kamerling guilty
thereof and ordered the respondent's reinstatement, with backpay from the
date of her dismissal. The petitioner has appealed by way of certiorari.
ISSUE: WON Petitioner is guilty of ULP? NO
RATIO:
 The pertinent legal provision is section 4 (a), subsection 5, of Republic Act
No. 875 which reads as follows:
o Sec. 4 Unfair Labor Practice, (a) It shall be unfair practice for an
employer: . . . (5) To dismiss, discharge, or otherwise prejudice or
discriminate against an employee for having filed charges or for having
given or
 The Court of Industrial relations has construed the foregoing as
including all cases where an employee is dismissed, discharged or
otherwise prejudiced or discriminated against by reason of the filing, by the
latter with the court or elsewhere of any charge against his employer.
 Section 4 (a) subsection 5, is part of the MagnaCharta of Labor which has
these underlying purposes:
o 1 The experience under Commonwealth Act No. 213 which now
regulates the subject, has shown the need for further safeguards to
the rights of workers to organize.
o The attached bill seeks to provide these safeguards, following the
pattern of United States ð 7 3 National Labor Relations Act with
suitable modifications demanded by local conditions. (Secs. 48.). The
bill will prevent unfair labor practices on the part of the employers
including not only acts of antiunion discrimination but also those
which are involved in the making of company unions.
before as well as after the union is registered with the Department
of Labor.
 The provisions of sections 1 and 3 are the bases for the protection of the
laborers' right to selforganization, and the enumeration in section 4 (of
unfair labor practices), are nothing more than a detailed description of an
employer's acts that may interfere with the right to selforganization and
collective bargaining.
 The American courts, in interpreting the provision of the Wagner Act
similar to section 4 (a), subsection 5, said:
o The statute goes no further than to safeguard the right of employees
to selforganization and to select representatives of their own
choosing for collective bargaining or other mutual protection without
restraint or coercion by their employer. That is fundamental right.
Employees have as clear a right to organize and select their
representatives for lawful purpose as the respondent has to organize
its business and select its own officers and agents.
 Despite the employee's right to selforganization, the employer therefore still
retains his inherent right to discipline his employees. his normal
prerogative to hire or dismiss them. The prohibition is directed only against
the use of the right to employ or discharge as an instrument of
discrimination, interference or oppression because of one's labor or union
activities.
 Under subsection 5 of section 4 (a), the employee's (1) having filed charges
or (2) having given testimony or (3) being about to give testimony, are
modified by "under this Act" appearing after the last item. In other words,
the three acts must have reference to the employees' right to self
organization and collective bargaining, because the element of unfair
labor practice is interference in such right.
 As the respondent's dismissal HAD NO RELATION TO UNION ACTIVITIES
and the charges filed by her against the petitioner had nothing to do with or
did not arise from her union activities, the appealed decision is hereby
reversed and the directness for the respondent's reinstatement with back
pay revoked.
Ermidia Mariano v. The Royal Interocean Lines (Koninkijke Java-China-
Pakitvaart Lijnen N. V. Amsterdam) and J. V. Kamerling
27 February 1961; Padilla, J.
Digest prepared by Jethro Koon
I. Facts (from a stipulation of facts)
1. Mariano was employed by Royal Interocean Lines as stenographer-
typist and filing clerk from 5 January 1932 until the outbreak of the war
on 8 December 1941, when the employment was interrupted, and from
1 March 1948 until 23 October 1953, when she was dismissed.
▪ At the time of her dismissal, she was receiving a basic salary of
P312 and a high cost of living allowance of P206, or a total of
P518 a month.
2. On 5 October 1953 she had sent a letter to the managing directors in
HK, coursed through its manager for the Phil., Kamerling, complaining
against the latter's "inconsiderate and untactful attitude" towards the
employees under him and the clients in the Phil.
▪ On 19 October 1953 Kamerling advised Mariano that her letter
had been forwarded to the managing directors of the appellant
company in HK;
▪ In view of the contents and tenor of her letter, the managing
directors believed with him that it was impossible to retain
her;
▪ Despite the fact that they were justified in dismissing her and
that she was not entitled to any compensation, out of
generosity and in consideration of her length of service, the
company was willing to grant her a sum equivalent to three
months salary;
▪ In order not to adversely affect her chances of future
employment with other firms, it was suggested that she hand
in a formal letter of resignation effective 31 October, otherwise
she would be dismissed; and that should they not hear from
her in writing until noon of 23 October, she would be
considered dismissed.
3. On 23 October 1953 Mariano sent a letter stating that she was
"compelled to hand this letter of resignation severing my services from
the Royal Interocean Lines effective October 31st, 1963, much to my
dislike and disappointment after being in their employment for almost
twenty-two (22) years". However, the company refused to accept her
letter and on the same date sent a letter dismissing her. She sought
reconsideration of her dismissal from HK but received no answer to any
of her five letters.
4. On 19 December 1953 the company finally tendered an offer of
compromise settlement whereby she would be paid the sum of P3,108
equivalent to six months salary, provided that she would sign a quit
claim.
5. Not satisfied, Mariano brought this action for recovery of damages in
the total sum of P107,002.58 and for other just and equitable relief.
6. The acting chief prosecutor of the CIR, at the Mariano's instance, filed a
complaint for ULP for having dismissed her from the service "for the
reason that she wrote a letter to the Managing Directors in HK
complaining against the Kamerling's attitude and behavior to her and
other employees." and for refusing to reinstate her to her former
position.
7. CIR found the company guilty and ordered reinstatement with backpay.
Company filed this “petition for certiorari to review” with the SC.
II. Issues
Whether the company was guilty of unfair labor practice in having dismissed
the Mariano because she had filed charges against Kamerling not connected
with or necessarily arising from union activities.
III. Holding
The judgment is reversed, but the company is ordered to pay P3,108, without
interest. No pronouncements as to costs.
IV. Ratio
1. §4(a), subsection 5, of RA 875 reads as follows: "It shall be unfair labor
practice for an employer to dismiss, discharge, or otherwise prejudice
or discriminate against an employee for having filed charges or for
having given or being about to give testimony under this Act."
2. Considering the policy behind the enactment of the statute, it is readily
discoverable that the provisions of §§1 and 3 are the bases for the
protection of the laborers right to self-organization, and the
enumeration in §4 (of unfair labor practices), are nothing more than a
detailed description of an employer's acts that may interfere with the
right of self-organization and collective bargaining.
3. Despite the right to self-organization, the employer still retains his
inherent right to discipline his employees, his normal prerogative to
hire or dismiss them. The prohibition is directed only against the use of
the right to employ or discharge as an instrument of discrimination,
interference or oppression because of one's labor or union activities.
4. The employee's (1) having filed charges or (2) having given testimony
 or (3) being about to give testimony, are modified by "under this Act"
appearing after the last item. The three acts must have reference to the
employee's right to self-organization and collective bargaining, because
ULP is interference in such right. It would be redundant to repeat
"under this Act" after each enumeration connected by the disjunctive
conjunction "or."
5. Considering that the dismissal is "not connected with or necessarily
arising from union activities" and does not constitute unfair labor
practice, Mariano has no cause of action. Nevertheless, as the dismissal
was without cause, because her inefficiency as the ground or reason for
her dismissal as claimed is belied by the successive increases of her
compensation, the amount of P3,108 for six months salary should be
paid to her.
FRANCISCO SALUNGA v. COURT OF INDUSTRIAL RELATIONS
September 27, 1967 | C.J. Concepcion
By: Perry
SUMMARY:
The petitioner dissatisfied with the way the Union was being run due to, what
he believed to be, several illegal or irregular disbursements of union funds,
tendered his resignation from the Union. The Union then informed the Company
of such resignation and sought to compel the Company to dismiss the petitioner
by virtue of his resignation from the Union. The Company then told the
petitioner that resigning from the Union would result in the termination of his
employment. Petitioner then wrote to the Union seeking to withdraw or revoke
his resignation. However, this withdrawal of resignation was not accepted by the
Union, which eventually resulted in his dismissal. Petitioner then filed an ULP
case against the Union, the Union officers and the Company.
The SC found the Union and the Union officers guilty of ULP and acquitted the
Company. It ruled that generally, membership in voluntary associations cannot
be compelled by the state. However, with regard to labor unions, the privilege of
choosing its members is qualified because it is imbued with public interest.
Therefore, the courts may compel the Union to reinstate Petitioner as a member
of the Union.
FACTS:
The petitioner was an employee of the Company and a member of the Union.
Both parties, entered into a CBA which provided, among others, a closed-shop
agreement. Sometime in 1961, the petitioner, due to his dissatisfaction with the
way the Union was being run, filed his resignation from the Union, which
accepted it. The Union then transmitted it to the Company and requested the
immediate implementation of the closed-shop agreement. The Company then
informed the petitioner that his resignation from the Union would result in the
termination of his employment. Upon being informed of that fact, the petitioner
sought to withdraw his resignation from the Union. This request for withdrawal
was however, not accepted by the Union and it sought to compel the company to
terminate the employment of the petitioner.
The petitioner appealed the decision of the Union of not accepting the
withdrawal of his resignation to the National President but his appeal was not
given due course. Eventually, the petitioner was dismissed causing him to file
ULP charges against the Union, its officers, and the Company. The trial judge
found all parties charged guilty of ULP. On appeal to the CIR en banc, the
decision of the trial judge was reversed. Hence, this petition with the SC.
ISSUE / HELD:
WON the Courts may compel the Union to reinstate the petitioner as its member.
YES.
RULING:
Although generally, a State may not compel ordinary voluntary associations to
admit thereto any given individual, because membership therein may be
accorded or withheld as a matter of privilege, the rule is qualified in respect of
labor unions holding a monopoly in the supply of labor, either in a given locality,
or as regards a particular employer with which it has a closed-shop agreement.
The closed-shop agreement and the union shop cause the admission
requirements of the trade union to become affected with public interest.
Likewise, a closed-shop, or union shop, or maintenance of membership clauses,
cause the administration of discipline by unions to be affected with public
interest.
Therefore, such unions are not entitled to arbitrarily exclude qualified
applicants for membership and a closed-shop provision would not justify the
employer in discharging, or a union in insisting upon the discharge of and
employee whom the union thus refuses to admit to membership, without any
reasonable ground. Needless to say, if said unions may be compelled to
admit new members, who have the requisite qualifications, with more reason
may the law and the courts exercise the coercive power when the employee
involved is a long standing union member, who, owing to provocations of union
officers, was impelled to tender his resignation, which he forthwith withdrew or
revoked. Surely, he may, at least, invoke the rights of those who seek admission
for the first time, and cannot arbitrarily be denied readmission.
As to the Company, the court found that the former is not guilty of ULP because
it deferred the discharge of petitioner and informed him of the consequences of
his actions. The Company gave due regard to the petitioner’s plight and was not
unfair to the petitioner. It did not merely show commendable understanding
and sympathy towards the petitioner but even tried to help him. The Company
cannot be blamed for the petitioner’s dismissal as it had the right to rely on the
decision of the Union of not accepting the readmission of the petitioner.
WHEREFORE, the appealed resolution of the CIR en banc is REVERSED.
HACIENDA FATIMA and/or VILLEGAS & SEGURA v NATIONAL FEDERATION
OF SUGARCANE WORKERS (NFSW)
January 28, 2003|Panganiban| By Ron San Juan
Summary:
Hacienda workers organized themselves into a union. Petitioners refused to sit
down with the union for the purpose of collective bargaining. Instead,
petitioners did not give the workers work for more than a month. Union filed
for illegal dismissal and ULP. SC held that the workers are regular employees,
hence, can only be dismissed for cause. SC also held that the acts of petitioners
constitute ULP.
Doctrine:
The respondents refusal to bargain, to their acts of economic inducements
resulting in the promotion of those who withdrew from the union, the use of
armed guards to prevent the organizers to come in, and the dismissal of union
officials and members, one cannot but conclude that respondents did not want a
union in their hacienda a clear interference in the right of workers to self-
organization.
Facts:
 Petitioners did not look with favor workers having organized themselves
into a union. Thus, when complainant union NFSW was certified as the
collective bargaining representative in the certification elections, petitioner
under the pretext that the result was on appeal, refused to sit down with the
union for the purpose of entering into a CBA. Moreover, the workers
including complainants herein were not given work for more than one
month. In protest, complainants staged a strike which was however settled
upon the signing of a MOA.
 However, alleging that NFSW failed to load the fifteen wagons, petitioners
reneged on its commitment to sit down and bargain collectively. Instead,
petitioners employed all means including the use of private armed guards to
prevent the organizers from entering the premises.
 Moreover, starting September 1991, petitioners did not any more give work
assignments to the complainants forcing the union to stage a strike. But due
to the conciliation efforts by the DOLE, another MOA was signed by the
complainants and petitioners which provides.
 Pursuant thereto, the parties subsequently met for a Conciliation Meeting.
When petitioners again reneged on its commitment, complainants filed the
present complaint for illegal dismissal and ULP.
 Petitioners: argued respondents refused to work and being choosy in the
kind of work they have to perform. They are seasonal workers, not regular.
 LA ruled for petitioners. NLRC reversed. CA affirmed NLRC.
Issues/Held:
Whether or not the respondent workers were illegally dismissed. (YES)
Respondents were regular employees as provided by Article 280 of the Labor
Code. 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 also been employed only for the duration of one
season. The evidence proves the existence of the first, but not of the second,
condition. The fact that respondents repeatedly worked as sugarcane workers
for petitioners for several years is not denied by the latter. Evidently, petitioners
employed respondents for more than one season. Therefore, the general rule of
regular employment is applicable.
Herein respondents, having performed the same tasks for petitioners every
season for several years, are considered the latters regular employees for their
respective tasks. Petitioners eventual refusal to use their services -- even if they
were ready, able and willing to perform their usual duties whenever these were
available -- and hiring of other workers to perform the tasks originally assigned
to respondents amounted to illegal dismissal of the latter.
Having failed to provide just cause for termination, petitioners illegally
dismissed the respondents.
Whether or not petitioners were guilty of ULP. (YES)
Indeed, from respondents refusal to bargain, to their acts of economic
inducements resulting in the promotion of those who withdrew from the union,
the use of armed guards to prevent the organizers to come in, and the dismissal
of union officials and members, one cannot but conclude that respondents did
not want a union in their hacienda a clear interference in the right of workers to
self-organization.
The finding of unfair labor practice done in bad faith carries with it the
sanction of moral and exemplary damages.
Progressive Development Corp. vs CIR
November 29, 1977 | Fernandez, J.
Sam
SUMMARY: Complainant-employees that were members of ACEA were
discriminated against by PDC by not giving them their working schedules,
lessening their number of working days and eventually dismissing them from
their employment, because of their refusal to disaffiliate from ACEA and join the
Progressive Employees Union (a union allegedly setup by PDC).
FACTS:
In September 1962, Araneta Coliseum Employees Association (ACEA) a
legitimate labor organization in behalf of forty-eight (48) members, instituted a
case ULP for unfair labor practice in the Court of Industrial Relations against
Progressive Development Corporation (PDC), a domestic business entity
operating the Araneta Coliseum, Jorge Araneta, Judy A. Roxas, Manuel B. Jover
and Ramon Llorente, as officers of the corporation PDC and Progressive
Employees Union (PEU), a labor organization existing in the PDC.
The complaint alleged that the PDC, through its officers, initiated a move to
disauthorize the counsel of the complainant ACEA from appearing in a union
conference with the respondents, petitioners herein; that the supervisors of PDC
encouraged, and assisted in, the formation of the Progressive Employees Union
(PEU) and coerced the employees, particularly the individual complainants, to
disaffiliate from the complainant union and to affiliate with the PEU; that in July
and August 1962 the respondents, petitioners herein, discriminated against the
individual complainants by either not giving them their working schedules,
lessening their number of working days and eventually dismissing them from
their employment, because of their refusal to disaffiliate from their union and
join the Progressive Employees Union.
PDC: the individual complainants were merely casuals or temporary employees
and their services depended on the availability of work as ushers, usherettes,
guards and janitors when there were shows, performances or exhibits at the
Araneta Coliseum. They alleged that they did not interfere with the complainant
union and in fact they met and conferred with said union's counsel; that they did
not initiate nor assist the PEU; that they did not discriminate against the
individual complainants nor dismiss them as said complainants were only
casuals or temporary employees.
Union: Denied that the officers and supervisors of the corporation PDC initiated
and assisted in its formation and claimed that its organization is the joint efforts
of the overwhelming majority of the employees and laborers of the corporation
PDC, free from any undue influence, interference and/or intimidation from any
party. The PEU claimed that the institution of the unfair labor practice case by
the complainants is a desperate attempt to unduly delay the proceedings for
certification election.
CIR: found PDC guilty of ULP
ISSUES/HELD:
W/N PDC was guilty of Unfair Labor Practices (through their union busting
activites)? YES.
RATIO:
It appears that the individual complainants, during show days, were always
scheduled to work until June 1962 when they were not included in the schedule
anymore. This virtually amounted to dismissal, without prior notice. Their not
being included in the list of schedule since June 1962 could only be the result of
petitioners' earlier threat of dismissal should said complainants refuse to heed
petitioners' admonition for them to resign from the ACEA.
From the facts of record, it is clear that the individual complainants were
dismissed because they refused to resign from the Araneta Coliseum Employees
Association and to affiliate with the Progressive Employees Union which was
being aided and abetted by the Progressive Development Corporation.
The assertion of the petitioner Progressive Development Corporation and its
officials that they have nothing to do with the formation of the Progressive
Employees Union is not supported by the facts of record.
The President then of the Progressive Employees Union was Jose Generoso, Jr.,
Stage Manager of the Progressive Development Corporation. The stage Manager,
Generoso, has supervisory power over the twenty-two (22) employees under
him. Generoso was then the No. 2 man in the Araneta Coliseum, being an
assistant of the Director of said Coliseum. While the Progressive Employees
Union was allegedly organized on June 26, 1962, it was only on July 11, 1962
that its existence was publicly announced when the management of the
petitioner corporation refused to meet with the Araneta Coliseum Employees
Association. The Progressive Employees Union never collected dues from its
members and all their members are now regular employees and are still
working in the construction unit of the Philippine Development Corporation.
There is evidence that the Progressive Employees Union became inactive after
the death of Atty. Reonista the former counsel of the Progressive Development
Corporation. This shows that the Progressive Employees Union was organized to
camouflage the petitioner corporation's dislike for the Araneta Coliseum
Employees Association and to stave off the latter's recognition.
Manila Mandarin Employees Union v NLRC, Melba C. Beloncio
G.R. No. 76898; 29 September 1987; Gutierrez, Jr., J.
By: Dudday
FACTS:
1. Private respondent, Melba C. Beloncio, an employee of Manila Mandarin Hotel
since 1976 and was the assistant head waitress at the hotel’s coffee shop, was
expelled from the Manila Mandarin Employees Union for acts allegedly inimical
to the interests of the union. The charge of disloyalty against Beloncio arose
from her emotional remark to a waitress who happened to be a union steward,
"Wala akong tiwala sa Union ninyo." The remark was made in the course of a
heated discussion regarding Beloncio's efforts to make a lazy and recalcitrant
waiter adopt a better attitude towards his work. The union demanded the
dismissal from employment of Beloncio on the basis of the union security
clause1 of their collective bargaining agreement and the Manila Mandarin Hotel
acceded by placing Beloncio on forced leave effective August 10, 1984.
2. Two days before the effective date of her forced leave, Beloncio filed a
complaint for unfair labor practice and illegal dismissal against herein Petitioner
Union and Manila Mandarin Hotel Inc. before the NLRC Arbitration Branch.
Petitioner-Union filed a Motion to Dismiss on the grounds of lack of cause of
action.
3. LA denied the motion to dismiss and decided in favor of Beloncio. It held that
the Union was guilty of ULP when it demanded Beloncio’s separation. NLRC
modified the LA’s decision and ordered the Union to pay the wages and fringe
benefits of Beloncio from the time she was placed on forced leave until she is
actually reinstated, and for Manila Mandarin Hotel was ordered to reinstate
Beloncio and to pay her whatever service charges may be due her during that
period which amount would be held in escrow by the hotel.
ISSUES
1. Whether NLRC has no jurisdiction over the present controversy because
the same involves intra-union conflicts – NLRC HAS JURISDICTION
2. Whether NLRC erred in ruling that Petitioner Union committed ULP and is
liable to pay Private Respondent - NO
RULING AND RATIO
1. NLRC has jurisdiction over the present controversy because the same
involves an interpretation of the collective bargaining agreement provisions
and whether or not there was an illegal dismissal.
 Under the CBA, membership in the union may be lost through expulsion only if
there is nonpayment of dues or a member organizes, joins, or forms another
labor organization.
 As correctly explained by the Labor Arbiter, "(I)f the only question is the legality
of the expulsion of Beloncio from the Union undoubtedly, the question is one
cognizable by the BLR (Bureau of Labor Relations). But, the question extended
to the dismissal of Beloncio or steps leading thereto. Necessarily, when the
hotel decides the recommended dismissal, its acts would be subject to scrutiny.
Particularly, it will be asked whether it violates or not the existing CBA.
Certainly, violations of the CBA would be unfair labor practice."
1
Section 2. Dismissals.
xxx xxx xx
b) Members of the Union who cease to be such members and/or who fail to maintain their membership
in good standing therein by reason of their resignation from the Union and/or by reason of their
expulsion from the Union in accordance with the Constitution and ByLaws of the Union, for nonpayment
of union dues and other assessment for organizing, joining or forming another labor organization shall,
upon written notice of such cessation of membership or failure to maintain membership in the Union and
upon written demand to the company by the Union, be dismissed from employment by the Company
after complying with the requisite due process requirement;
 Article 250 of the Labor Code provides it is considered as an unfair labor
practice for a labor organization to cause or attempt to cause an employer to
discriminate against an employee, including discrimination against an employee
with respect to whom membership in such organization has been denied or to
terminate an employee on any ground other than the usual terms and
conditions under which membership or continuation of membership is made
available to other members.
 Reading Article 250 with Article 217 of the Labor Code which provides that
Labor Arbiters shall have original and exclusive jurisdiction to hear and decide
ULP cases and the NLRC shall have exclusive appellate jurisdiction thereto, it
becomes pretty obvious that the case falls squarely within the NLRC
jurisdiction.
2. There is no error in the questioned decision. The Petitioner-Union is guilty
of unfair labor practice for which they must be held liable.
 The Hotel would not have compelled Beloncio to go on forced leave were it not
for the union's insistence and demand to the extent that because of the failure
of the hotel to dismiss Beloncio as requested, the union filed a notice of strike
with the Ministry of Labor and Employment on August 17, 1984 on the issue of
unfair labor practice. The hotel was then compelled to put Beloncio on forced
leave and to stop payment of her salary from September 1, 1984.
 The collective bargaining agreement in this case contains a union security
clause — a closedshop agreement. A closedshop agreement is an agreement
whereby an employer binds himself to hire only members of the contracting
union who must continue to remain members in good standing to keep their
jobs. By holding out to loyal members a promise of employment in the closed-
shop, it welds group solidarity.
 While the Court has held in numerous cases that a closed-shop agreement is a
valid form of union security, union security clauses are also governed by law
and by principles of justice, fair play, and legality. Union security clauses cannot
be used by union officials against an employer, much less their own members,
except with a high sense of responsibility, fairness, prudence, and
judiciousness. A union member may not be expelled from her union, and
consequently from her job, for personal or impetuous reasons or for causes
foreign to the closedshop agreement and in a manner characterized by
arbitrariness and whimsicality.
 This is particularly true in this case where Ms. Beloncio was trying her best to
make a hotel bus boy do his work promptly and courteously so as to serve hotel
customers in the coffee shop expeditiously and cheerfully. Union membership
does not entitle waiters, janitors, and other workers to be sloppy in their work,
inattentive to customers, and disrespectful to supervisors. The Union should
have disciplined its erring and troublesome members instead of causing so
much hardship to a member who was only doing her work for the best interests
of the employer, all its employees, and the general public whom they serve.
Petition dismissed. NLRC affirmed.
Ilaw at Buklod ng Manggagawa (IBM) v. NLRC
Narvasa, J.
Unfair Labor Practice
FACTS
 The controversy at bar had its origin in the "wage distortions" affecting
the employees of respondent San Miguel Corporation allegedly caused
by Republic Act No. 6727, otherwise known as the Wage Rationalization
Act.
 Upon the effectivity of the Act on June 5, 1989, the union known as
"Ilaw at Buklod Ng Manggagawa (IBM)" — said to represent 4,500
employees of San Miguel Corporation, presented to the company a
"demand" for correction of the "significant distortion in . . . (the
workers') wages."
o In that "demand," the Union explicitly invoked Section 4 (d) of
RA 6727 which reads as follows: (d) . . . Where the application
of the increases in the wage rates under this Section results in
distortions as defined under existing laws in the wage
structure within an establishment and gives rise to a dispute
therein, such dispute shall first be settled voluntarily between
the parties and in the event of a deadlock, the same shall be
finally resolved through compulsory arbitration by the regional
branches of the National Labor Relations Commission (NLRC)
having jurisdiction over the workplace. It shall be mandatory
for the NLRC to conduct continuous hearings and decide any
dispute arising under this Section within twenty (20) calendar
days from the time said dispute is formally submitted to it for
arbitration. The pendency of a dispute arising from a wage
distortion shall not in any way delay the applicability of the
increase in the wage rates prescribed under this Section.
 Union claims that "demand was ignored
 When SMC rejected the reduced proposal of the UNION, the members ,
 on their own accord, refused to render overtime services
 The workers involved also issued a joint notice: SAMA-SAMANG
PAHAYAG: KAMING ARAWANG MANGGAGAWA NG POLO BREWERY
PAWANG KASAPI NG ILAW AT BUKLOD NG MANGGAGAWA (IBM) AY
NAGKAISANG NAGPASYA NA IPATUPAD MUNA ANG EIGHT HOURS
WORK SHIFT PANSAMANTALA HABANG HINDI IPINATUTUPAD NG
SMC MANAGEMENT ANG TAMANG WAGE DISTORTION.
 The Union's position was that the workers' refuse "to work beyond
eight (8) hours everyday starting October 16, 1989" as a legitimate
means of compelling SMC to correct "the distortion in their wages
brought about by the implementation of the said laws (R.A. 6640 and
R.A. 6727) to newly-hired employees.
o That decision to observe the "eight hours work shift" was
implemented on October 16, 1989 by "some 800 daily-paid
workers ,all members of IBM .
o This abandonment of the long-standing schedule of work and
the reversion to the eight-hour shift apparently caused
substantial losses to SMC. These losses occurred despite such
measures taken by SMC as organizing "a third shift composed
of regular employees and some contractuals," and appeals "to
the Union members, through letters and memoranda and
dialogues with their plant delegates and shop stewards," to
adhere to the existing work schedule.
 SMC filed with the Arbitration Branch of the National Labor Relations
Commission a complaint against the Union and its members "to declare
the strike or slowdown illegal" and to terminate the employment of the
union officers and shop stewards.
 Then on December 8, 1989, on the claim that its action in the
Arbitration Branch had as yet "yielded no relief," SMC filed another
complaint against the Union and members thereof, this time directly
with the National labor Relations Commission, "to enjoin and restrain
illegal slowdown and for damages, with prayer for the issuance of a
cease-and-desist and temporary restraining order. TRO was issued, but
case remained pending.
ISSUE/RULING
Whether the workers' abandonment of the regular work schedule and
their deliberate and wilful reductoon of the plant's production efficiency is
a slowdown, which is an illegal and unprotected concerted activity. YES
 Among the rights guaranteed to employees by the Labor Code is that of
engaging in concerted activities in order to attain their legitimate
objectives. Article 263 of the Labor Code, as amended, declares that in
line with "the policy of the State to encourage free trade unionism and
free collective bargaining, . . (w)orkers shall have the right to engage in
concerted activities for purposes of collective bargaining or for their
mutual benefit and protection."
 A similar right to engage in concerted activities for mutual benefit and
protection is tacitly and traditionally recognized in respect of
employers.
 The more common of these concerted activities as far as employees are
concerned are: strikes — the temporary stoppage of work as a result of
an industrial or labor dispute; picketing — the marching to and fro at
the employer's premises, usually accompanied by the display of
placards and other signs making known the facts involved in a labor
dispute; and boycotts — the concerted refusal to patronize an
employer's goods or services and to persuade others to a like refusal.
 On the other hand, the counterpart activity that management may licitly
undertake is the lockout — the temporary refusal to furnish work on
account of a labor dispute, In this connection, the same Article 263
provides that the "right of legitimate labor organizations to strike and
picket and of employer to lockout, consistent with the national interest,
shall continue to be recognized and respected."
 The legality of these activities is usually dependent on the legality of the
purposes sought to be attained and the means employed therefor.
 It goes without saying that 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.
o The provision states that — . . the employer and the union shall
negotiate to correct the distort-ions. Any dispute arising from
wage distortions shall be resolved through the grievance
procedure under their collective bargaining agreement and, if it
remains unresolved, through voluntary arbitration. Unless
otherwise agreed by the parties in writing, such dispute shall
be decided by the voluntary arbitrator or panel of voluntary
arbitrators within ten (10) calendar days from the time said
dispute was referred to voluntary arbitration. In cases where
there are no collective agreements or recognized labor unions,
the employers and workers shall endeavor to correct such
distortions. Any dispute arising therefrom shall be settled
through the National Conciliation and Mediation Board and, if it
remains unresolved after ten (10) calendar days of conciliation,
 shall be referred to the appropriate branch of the National
Labor Relations Commission (NLRC). It shall be mandatory for
the NLRC to conduct continuous hearings and decide the
dispute within twenty (20) calendar days from the time said
dispute is submitted for compulsory arbitration. The pendency
of a dispute arising from a wage distortion shall not in any way
delay the applicability of any increase in prescribed wage rates
pursuant to the provisions of law or Wage Order. x x x xx
x xxx
o The legislative intent that solution of the problem of wage
distortions shall be sought by voluntary negotiation or
abitration, and not by strikes, lockouts, or other concerted
activities of the employees or management, is made clear in the
rules implementing RA 6727 issued by the Secretary of Labor
and Employment12 pursuant to the authority granted by
Section 13 of the Act.13 Section 16, Chapter I of these
implementing rules, after reiterating the policy that wage
distortions be first settled voluntarily by the parties and
eventually by compulsory arbitration, declares that, "Any issue
involving wage distortion shall not be a ground for a
strike/lockout."
 Moreover, the collective bargaining agreement between the SMC and
the Union also prescribes a similar eschewal of strikes or other similar
or related concerted activities as a mode of resolving disputes or
controversies, generally, said agreement clearly stating that settlement
of "all disputes, disagreements or controversies of any kind" should be
achieved by the stipulated grievance procedure and ultimately by
arbitration.
o The Union was thus prohibited to declare and hold a strike or
otherwise engage in non-peaceful concerted activities for the
settlement of its controversy with SMC in respect of wage
distortions, or for that matter; any other issue "involving or
relating to wages, hours of work, conditions of employment
and/or employer-employee relations."
o The partial strike or concerted refusal by the Union members
to follow the five-year-old work schedule which they had
therefore been observing, resorted to as a means of coercing
correction of "wage distortions," was therefore forbidden by
law and contract and, on this account, illegal.
Case remanded.
San Miguel Corp v. NLRC and San Miguel Corp Employees’ Union-
PTGWO (1999)
PURISIMA, J.
 July 1990, San Miguel Corporation, alleging financial losses, shut down some of
its plants and declared 55 positions as redundant, listed as follows:
seventeen(17) employees in the Business Logistics Division (BLD),
seventeen (17) in the Ayala Operations Center (AOC), and eighteen (18) in the
Magnolia-Manila Buying Station (Magnolia-MBS.)
 The union filed several grievance cases for the said retrenched employees,
praying for the redeployment of the said employees to the other divisions of the
company.
 The grievance proceedings were conducted pursuant to Sections 5 and 8,
Article VIII of the parties 1990 Collective Bargaining Agreement. 2
2
Sec.5. Processing of Grievance. - Should a grievance arise, an earnest effort shall
be made to settle the grievance expeditiously in accordance with the following
procedures:
Step 1. - The individual employee concerned and the Union Directors, or the Union
Steward shall, first take up the employees grievance orally with his immediate
superior. If no satisfactory agreement or adjustment of the grievance is reached, the
grievance shall, within twenty (20) working days from the occurrence of the cause or
event which gave rise to the grievance, be filed in writing with the Department
Manager or the next level superior who shall render his decision within ten (10)
working days from the receipt of the written grievance. A copy of the decision shall
be furnished the Plant Personnel Officer.
Step 2. - If the decision in Step 1 is rejected, the employee concerned may elevate or
appeal this in writing to the Plant Manager/Director or his duly authorized
representative within twenty (20) working days from the receipt of the Decision of
the Department Manager. Otherwise, the decision in Step 1 shall be deemed
accepted by the employee.
The Plant Manager/Director assisted by the Plant Personnel Officer shall determine
the necessity of conducting grievance meetings. If necessary, the Plant
Manager/Director and the Plant Personnel Officer shall meet the employee
concerned and the Union Director/Steward on such date(s) as may be designated by
the Plant Manager. In every plant/office, Grievance Meetings shall be scheduled at
least twice a month.
The Plant Manager shall give his written comments and decision within ten (10)
working days after his receipt of such grievance or the date of submission of the
grievance for resolution, as the case may be.A copy of his Decision shall be
furnished the Employee Relations Directorate.
Step 3. - If no satisfactory adjustment is arrived at Step 2, the employee may appeal
the Decision to the Conciliation Board as provided under Section 6 hereof, within
fifteen (15) working days from the date of receipt of the decision of the Plant
Manager/Director or his designate. Otherwise, the decision in Step 2 shall be
deemed accepted by the employee.
  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 Step 3 of the grievance
procedure.
 In a meeting on October 26, 1990, SMC informed the union that if by October
30, the remaining 17 employees could not yet be redeployed, their services
would be terminated on November 2.
 Mr. Daniel S. L. Borbon II, a rep of the union, declared that there was nothing
more to discuss in view of the deadlock.
 November 7, 1990, the union filed with the National Conciliation and Mediation
Board (NCMB) of the DOLE a notice of strike on the following
grounds: a) bargaining deadlock; b) union busting; c) gross violation of the
Collective Bargaining Agreement (CBA), such as non-compliance with the
grievance procedure; d) failure to provide private respondent with a list of
vacant positions pursuant to the parties side agreement that was appended to
the 1990 CBA; and e) defiance of voluntary arbitration award. Petitioner on the
other hand, moved to dismiss the notice of strike but the NCMB failed to act on
the motion.
 SMC asked to dismiss the notice of strike given by union and for it to comply
with the provisions of the SBA on grievance machinery, arbitration, and the no-
strike clause.
 NLRC dismissed the SMC complaint, hence this certiorari petition.
ISSUE: WON NLRC committed grave abuse of discretion in dismissing SMC’s
complaint?- YES
The Conciliation Board shall meet on the grievance in such dates as shall be
designated by the Division/Business Unit Manager or his representative. In every
Division/Business Unit, Grievance Meetings of the Conciliation Board shall be
scheduled at least once a month.
The Conciliation Board shall have fifteen (15) working days from the date of
submission of the grievance for resolution within which to decide on the grievance.
SEC. 6. Conciliation Board. - There shall be a conciliation Board per Business Unit
or Division. Every Conciliation Board shall be composed of not more than five (5)
representatives each from the Company and the Union. Management and the Union
may be assisted by their respective legal counsels.
In every Division/Business Unit, the names of the Company and Union
representatives to the Conciliation Board shall be submitted to the Division/Business
Unit Manager not later than January of every year. The Conciliation Board members
shall act as such for one (1) year until removed by the Company or the Union, as the
case may be.
Sec. 8. Submission to Arbitration. - If the employee or Union is not satisfied with
the Decision of the Conciliation Board and desires to submit the grievance to
arbitration, the employee or the Union shall serve notice of such intention to the
Company within fifteen (15) working days after receipt of the Boards decision. If no
such written notice is received by the Company within fifteen (15) working days, the
grievance shall be considered settled on the basis of the companys position and shall
no longer be available for arbitration.
See Rule XXII, Section I, of the Rules and Regulations Implementing Book V the Labor
Code.3 In the case under consideration, the grounds relied upon by the private
respondent union are non-strikeable. The grounds appear more illusory than real.
 Collective Bargaining Deadlock- the situation between the labor and the
management of the company where there is failure in the collective bargaining
negotiations resulting in a stalemate.
o This situation is non-existent in the present case since there is a Board
assigned on Step 3 of the grievance machinery to resolve the conflicting
views of the parties.
o Instead of asking the Conciliation Board composed of five representatives
each from the company and the union to decide the conflict, union declared
a deadlock & filed a notice of strike.
o It failed to exhaust all the steps in the grievance machinery and arbitration
proceedings provided in the CBA, thus the notice of strike should have
been dismissed by the NLRC and the union ordered to proceed with the
grievance and arbitration proceedings.
o Liberal Labor Union vs. Phil. Can Co: the strike staged by the union is illegal
for not complying with the grievance procedure provided in the collective
bargaining agreement. The main purpose of the parties in adopting a
procedure in the settlement of their disputes is to prevent a strike. This
procedure must be followed in its entirety if it is to achieve its objective.
x x x strikes held in violation of the terms contained in the collective
bargaining agreement are illegal, especially when they provide for
conclusive arbitration clauses. These agreements must be strictly adhered to
and respected if their ends have to be achieved.
 Re: alleged violation of the CBA, such a violation is chargeable against the union. In
abandoning the grievance proceedings and stubbornly refusing to avail of the
remedies under the CBA, it violated the mandatory provisions of the collective
bargaining agreement.
 Abolition of departments or positions in the company is one of the recognized
management prerogatives.
o The union does not question the validity of the business move of
petitioner.
o It is presumed that SMC acted in good faith. In fact, it redeployed most of
the employees involved; such that from an original 17 excess employees in
BLD, 15 were successfully redeployed. In AOC, out of the 17 original excess,
15 were redeployed. In the Magnolia - Manila Buying Station, out of 18
employees, 6 were redeployed and only 12 were terminated.
o SMC having evinced its willingness to negotiate the fate of the remaining
employees affected, there is no ground to sustain the notice of strike of the
private respondent union.
3
Section 1. Grounds for strike and lockout. -- A strike or lockout may be declared in
cases of bargaining deadlocks and unfair labor practices. Violations of the collective
bargaining agreements, except flagrant and/or malicious refusal to comply with its
economic provisions, shall not be considered unfair labor practice and shall not be
strikeable. No strike or lockout may be declared on grounds involving inter-union
and intra-union disputes or on issues brought to voluntary or compulsory
arbitration.
 NLRC gravely abused its discretion in dismissing the complaint of petitioner SMC for
the dismissal of the notice of strike, issuance of a temporary restraining order, and
an order compelling the respondent union to settle the dispute under the grievance
machinery of their CBA.
DISPOSITIVE: PETITION GRANTED. 3rd Step of Grievance Procedure to commence.
San Miguel Corporation v. NLRC, Ilaw at Buklod ng Manggagawa
(IBM)
G.R. No. 119293
June 10, 2003
Azcuna, J.
FACTS:
 Petitioner SMC and respondent IBM, the exclusive bargaining agent of
petitioner’s daily-paid rank and file employees, executed a CBA under
which they agreed to submit all disputes to grievance and arbitration
proceedings.4 It also included a mutually enforceable no-strike no-lockout
agreement.5
 April 11, 1994 – IBM, through its VP Colomeda, filed with the NCMB a
notice of strike against petitioner for allegedly committing: (1) illegal
dismissal of union members, (2) illegal transfer, (3) violation of CBA, (4)
contracting out of jobs being performed by union members, (5) labor-only
contracting, (6) harassment of union officers and members, (7) non-
recognition of duly-elected union officers, and (8) other acts of unfair labor
practice.
 Next day, IBM filed another notice of strike, this time though its President
Galvez raising similar ground.
 Galvez group requested the NCMB to consolidate its notice of strike with
that of the Colomeda group, to which the latter opposed, alleging that
Galvez lacks authority in filing the same.
ISSUE:
 Petitioner filed a Motion for Severance of Notices of Strike with Motion to
Dismiss, on the grounds that the notices raised non-strikeable issues and
that they affected four corporations which are separate and distinct from
each other.
4
HOLDING/RATIO:
5
 NCMB Director Ubaldo found that the real issues involved are non-
strikeable grounds. He issued an order converting their notices of strike
into preventive mediation.
 May 16, 1994 – Colomeda group filed with the NCMB a notice of holding a
strike vote. This was opposed by petitioner. Colomeda group notified the
NCMB of the results of their strike vote, which favored the holding of a
strike. The strike paralyzed the operations of petitioner, causing it losses
allegedly worth P29.98 M in daily lost production.
 May 23, 1994 – Galvez group filed its second notice of strike. NCMB
however found the grounds to be mere amplifications of those alleged in
the first notice.
 Petitioner filed with the NLRC a Petition for Injunction. NLRC resolved to
issue a TRO directing free ingress and egress from petitioner’s plants,
without prejudice to the union’s right to peaceful picketing and continuous
hearings on the injunction case.
 Petitioner entered into a Memorandum of Agreement (MOA) with IBM,
calling for a lifting of the picket lines and resumption of work in exchange
of good faith talks. The MOA, signed in the presence of DOLE officials,
expressly stated that cases filed in relation to their dispute will continue
and will not be affected in any manner whatsoever by the agreement. The
picket lines ended and work was then resumed.
 November 29, 1994 – NLRC issued the challenged decision, denying SMC’s
petition for injunction for lack of factual basis. It found that the
circumstances at the time did not constitute or no longer constituted an
actual or threatened commission of unlawful acts.
 Hence, this petition.
(1) WON NLRC gravely abused its discretion when it failed to enforce, by
injunction, the parties’ reciprocal obligations to submit to arbitration and
not to strike. YES.
(2) WON NLRC gravely abused its discretion in withholding injunction which is
the only immediate and effective substitute for the disastrous economic
warfare that arbitration is designed to avoid. YES.

Article 254 of the LC provides that no temporary or permanent injunction
or restraining order in any case involving or growing out of labor disputes
shall be issued by any court or other entity except as otherwise provided in
Articles 218 and 264.
o Under the first exception, Article 218 (e) of the Labor Code
expressly confers upon the NLRC the power to enjoin or restrain
actual and threatened commission of any or all prohibited or
unlawful acts, or to require the performance of a particular act in
any labor dispute which, if not restrained or performed forthwith,
may cause grave or irreparable damage to any party or render
ineffectual any decision in favor of such party.
o The second exception, on the other hand, is when the labor
organization or the employer engages in any of the prohibited
activities enumerated in Article 264.

In the case at bar, petitioner sought a permanent injunction to enjoin the
respondent’s strike. A strike is considered as the most effective weapon in
protecting the rights of the employees to improve the terms and conditions
of their employment. However, to be valid, a strike must be pursued within
legal bounds. One of the procedural requisites that Article 263 of the Labor
Code and its IRR prescribe is the filing of a valid notice of strike with the
NCMB. Imposed for the purpose of encouraging the voluntary settlement
of disputes, this requirement has been held to be mandatory, the lack of
which shall render a strike illegal.

In the present case, NCMB converted IBM’s notices into preventive
mediation as it found that the real issues raised are non-strikeable. Such
order is in pursuance of the NCMB’s duty to exert all efforts at mediation
and conciliation to enable the parties to settle the dispute amicably, and in
line with the state policy of favoring voluntary modes of settling labor
disputes. In accordance with the IRR of the LC, the said conversion has the
effect of dismissing the notices of strike filed by respondent. A case in point
is PAL v. Drilon, where the Court declared a strike illegal for lack of a valid
notice of strike, in view of the NCMB’s conversion of the notice therein into
a preventive mediation case.

Clearly, therefore, applying the aforecited ruling to the case at bar, when
the NCMB ordered the preventive mediation, respondent had thereupon
lost the notices of strike it had filed. Subsequently, however, it still defiantly
proceeded with the strike while mediation was ongoing, and
notwithstanding the letter-advisories of NCMB warning it of its lack of
notice of strike.

Such disregard of the mediation proceedings was a blatant violation of the
IRR, which explicitly oblige the parties to bargain collectively in good faith
and prohibit them from impeding or disrupting the proceedings.

The NCMB having no coercive powers of injunction, petitioner sought
recourse from the public respondent. The NLRC issued a TRO only for free
ingress to and egress from petitioners plants, but did not enjoin the
unlawful strike itself. It ignored the fatal lack of notice of strike.

Moreover ruled that there was a lack of factual basis in issuing the
injunction. Contrary to the NLRC’s finding, the Court finds that at the time
the injunction was being sought, there existed a threat to revive the
unlawful strike as evidenced by the flyers then being circulated by the IBM-
NCR Council which led the union. These flyers categorically declared:
Ipaalala nyo sa management na hindi iniaatras ang ating Notice of Strike
(NOS) at anumang oras ay pwede nating muling itirik ang picket line. These
flyers were not denied by respondent, and were dated June 19, 1994, just a
day after the union’s manifestation with the NLRC that there existed no
threat of commission of prohibited activities.

Moreover, it bears stressing that Article 264(a) of the Labor Code explicitly
states that a declaration of strike without first having filed the required
notice is a prohibited activity, which may be prevented through an
injunction in accordance with Article 254. Clearly, public respondent should
have granted the injunctive relief to prevent the grave damage brought
about by the unlawful strike.

Also noteworthy is public respondent’s disregard of petitioner’s argument
pointing out the unions failure to observe the CBA provisions on grievance
and arbitration. In the case of San Miguel Corp. v. NLRC, we ruled that the
union therein violated the mandatory provisions of the CBA when it filed a
notice of strike without availing of the remedies prescribed therein.

As in the abovecited case, petitioner herein evinced its willingness to
negotiate with the union by seeking for an order from the NLRC to compel
observance of the grievance and arbitration proceedings. Respondent
however resorted to force without exhausting all available means within its
reach. Such infringement of the aforecited CBA provisions constitutes
further justification for the issuance of an injunction against the strike. As
 we said long ago: Strikes held in violation of the terms contained in a
collective bargaining agreement are illegal especially when they provide for
conclusive arbitration clauses. These agreements must be strictly adhered
to and respected if their ends have to be achieved. 6
 As to petitioner’s allegation of violation of the no-strike provision in the
CBA, jurisprudence has enunciated that such clauses only bar strikes which
are economic in nature, but not strikes grounded on unfair labor practices.
The notices filed in the case at bar alleged unfair labor practices, the initial
determination of which would entail fact-finding that is best left for the
labor arbiters. Nevertheless, our finding herein of the invalidity of the
notices of strike dispenses with the need to discuss this issue.
 The Court cannot sanction IBM’s brazen disregard of legal requirements
imposed purposely to carry out the state policy of promoting voluntary
modes of settling disputes. The states commitment to enforce mutual
compliance therewith to foster industrial peace is affirmed by no less than
our Constitution. Trade unionism and strikes are legitimate weapons of
labor granted by our statutes. But misuse of these instruments can be the
subject of judicial intervention to forestall grave injury to a business
enterprise.
Baptista v Villanueva
July 31, 2013 | Mendoza, J.
By: AP
SUMMARY:
Petitioners were expelled from their union because they violated a provision in
their Constitution and By-laws which prohibit filing of case in court before all
internal remedies are exhausted. They were expelled from the union, then
terminated by RPN pursuant to the CBA union security clause. They then filed a
ULP case against respondent. LA in their favour. NLRC, CA and SC ruled for
respondents.
DOCTRINE: (4-fold Test)
Workers’ and employers’ organizations shall have the right to draw up their
constitutions and rules to elect their representatives in full freedom, to organize
their administration and activities and to formulate their programs; RPNEU’s
Constitution and By-Laws expressly mandate that before a party is allowed to
seek the intervention of the court, it is a pre-condition that he should have
availed of all the internal remedies within the organization.
6
FACTS:
Petitioners were former union members of Radio Phil Network Employees
Union (RPNEU) which was the SEBA of RPN while respondents are elected
officers and members of the same.
Petitioners filed a complaint for impeachment of their union president before
the executive board of RPN. This was eventually abandoned. They later re-
lodged the impeachment complaint, this time, against all union officers and
members of RPNEU before the DOLE. They also filed various petitions for an
audit.
3 complaints were later filed against them before the union’s Committee on
Grievance and Investigation (Committee) for alleged violation of the union’s
Constitution and By-Law. It was alleged, inter alia, that they violated Article IX,
Section 2.5 for urging or advocating that a member start an action in any court
of justice or external investigative body against the Union or its officer without
first exhausting all internal remedies open to him or available in accordance
with the CBL.
After investigation, the committee recommended their expulsion to the union’s
Board of Directors. They were then expelled.
The union then informed RPN of the expulsion and requested the management
to serve them notices of termination in compliance with their CBA’s union
security clause. They were then terminated.
Petitioner filed 3 complaints for ULP against respondents questioning their
expulsion from the union and their subsequent termination from employment.
LA: ruled in their favour and adjudged respondents guilty of ULP pursuant to
Article 249(a) and (b) of the Labor Code. It clarified, however, that only union
officers of the union should be held responsible so it exonerated 6 of original
defendants who were mere union members.
NLRC: reversed LA. It dismissed the ULP charge for lack of merit. NLRC found
that petitioners filed a suit calling for the impeachment of the officers and
members of the Executive Board of RPNEU without first resorting to internal
remedies available under its own Constitution and By-Laws.
CA: affirmed.
ISSUES/HELD:
WON respondents are guilty of ULP. NO
RATIO:
ULP concept imbedded in article 247 of LC.
- commission of acts that transgress the workers’ right to organize;
- As specified in Articles 248 and 249 of the Labor Code, the prohibited
acts must necessarily relate to the workers' right to self-organization and to the
observance of a CBA; Absent the said vital elements, the acts complained,
although seemingly unjust, would not constitute ULP.
Petitioners: Procedure that should have been followed by the respondents in
resolving the charges against them was Article XVII, Settlement of Internal
Disputes of their Constitution and By-Laws, specifically, Section 232
Said rule requires members to put their grievance in writing to be submitted to
their union president, who shall strive to have the parties settle their differences
amicably. Petitioners maintain that any form of grievance would be referred
only to the committee upon failure of the parties to settle amicably
SC: Disagreed
- Based on RPNEU’s Constitution and By-Laws, the charges against
petitioners were not mere internal squabbles, but violations that demand
proper investigation because, if proven, would constitute grounds for their
expulsion from the union;
- As such, Article X on Investigation Procedures and Appeal Process
where any charge against any member or officer shall be submitted to the Board
of Directors which shall refer it (if necessary) to the committee which shall
forward its finding and recommendation to the board, was properly applied.
Any procedural flaw in the proceedings before the Committee deemed cured
when petitioners were given the opportunity to be heard;
- In administrative proceedings, the filing of charges and giving
reasonable opportunity for the person so charged to answer the accusations
against him constitute the minimum requirements of due process;
- Essence of due process is simply to be heard, or as applied to
administrative proceedings, an opportunity to explain one’s side;
Re: Opportunity to personally face and confront accusers
- Mere absence of a one-onone confrontation between the petitioners
and their complainants does not automatically affect the validity of the
proceedings before the Committee.
- Not all cases necessitate a trial-type hearing;
No ULP
- Well settled: workers’ and employers’ organizations shall have the right
to draw up their constitutions and rules to elect their representatives in full
freedom, to organize their administration and activities and to formulate their
programs;
- Here: RPNEU’s Constitution and By-Laws expressly mandate that before
a party is allowed to seek the intervention of the court, it is a pre-condition that
he should have availed of all the internal remedies within the organization;
- Petitioners were found to have violated the provisions of the union’s
Constitution and By-Laws when they filed petitions for impeachment against
their union officers and for audit before the DOLE without first exhausting all
internal remedies available within their organization;
o petitioners’ expulsion from the union was not a deliberate attempt to
curtail or restrict their right to organize, but was triggered by the commission of
an act, expressly sanctioned by Section 2.5 of Article IX of the union’s
Constitution and By-Laws;
Onus probandi (for ULP charge to prosper) rests upon the party alleging it
to prove or substantiate such claims by the requisite quantum of evidence
- In labor cases, as in other administrative proceedings, substantial
evidence or such relevant evidence as a reasonable mind might accept as
sufficient to support a conclusion is required;
- Indubitable that all the prohibited acts constituting unfair labor
practice should materially relate to the workers' right to self-organization;
- Here: petitioners failed to discharge the burden required to prove the
charge of ULP against the respondents;
o Petitioners were not able to establish how they were restrained or
coerced by their union in a way that curtailed their right to self-organization.
o The records likewise failed to sufficiently show that the respondents
unduly persuaded management into discriminating against petitioners. other
than to bring to its attention their expulsion from the union, which in turn,
resulted in the implementation of their CBA' s union security clause.

T&H Shopfitters Corp. V. T&H Shopfitters Corp. Workers
Union7
February 26, 2014| MENDOZA, J.
By: Justin
SUMMARY:
FACTS:
 On September 7, 2004, the T&H Shopfitters Corporation/ Gin Queen
Corporation workers union (THS-GQ Union) filed their Complaint for
Unfair Labor Practice (ULP) by way of union busting, and Illegal
Lockout, with moral and exemplary damages and attorney’s fees,
against T&H Shopfitters Corporation (T&H Shopfitters) and Gin Queen
Corporation before the Labor Arbiter (LA).
 1st CAUSE: In their desire to improve their working conditions,
respondents and other employees of held their first formal meeting on
November 23, 2003 to discuss the formation of a union. The following
day, seventeen (17) employees were barred from entering petitioners’
factory premises located in Castillejos, Zambales, and ordered to
transfer to T&H Shopfitters’ warehouse at Subic Bay Freeport Zone
(SBFZ) purportedly because of its expansion. Afterwards, the said
seventeen (17) employees were repeatedly ordered to go on forced
leave due to the unavailability of work.
 Respondents contended that the affected employees were not given
regular work assignments, while subcontractors were continuously
hired to perform their functions. Respondents sought the assistance of
the National Conciliation and Mediation Board. Subsequently, an
agreement between petitioners and THS-GQ Union was reached.
Petitioners agreed to give priority to regular employees in the
distribution of work assignments. Respondents averred, however, that
petitioners never complied with its commitment but instead hired
7 assigned work on a rotational basis. It explains that its failure to
T & H SHOPFITTERS CORPORATION/GIN QUEEN CORPORATION, STINNES HUANG,
BEN HUANG and ROGELIO MADRIAGA, Petitioners,
vs.
T & H SHOPFITTERS CORPORATION/GIN QUEEN WORKERS UNION, ELPIDIO
ZALDIVAR, DARI OS GONZALES, WILLIAM DOMINGO, BOBBY CASTILLO, JIMMY M.
PASCUA, GERMANO M. BAJO, RICO L. MANZANO, ALLAN L. CALLORINA, ROMEO
BLANCO, GILBERT M. GARCIA, CARLOS F. GERILLO, EDUARDO A. GRANDE,
EDILBRANDO MARTICIO, VIVENCIO SUSANO, ROLANDO GARCIA, JR., MICHAEL
FABABIER, ROWELL MADRIAGA, PRESNIL TOLENTINO, MARVIN VENTURA,
FRANCISCO RIVARES, PLACIDO TOLENTINO and ROLANDO ROMERO, Respondents.
contractual workers. Instead, Respondents claimed that the work
weeks of those employees in the SBFZ plant were drastically reduced to
only three (3) days in a month.
 2nd CAUSE: On March 24, 2004, THS-GQ Union filed a petition for
certification election and an order was issued to hold the certification
election in both T&H Shopfitters and Gin Queen.
 On October 10, 2004, petitioners sponsored a field trip to Iba,
Zambales, for its employees. The officers and members of the THS-GQ
Union were purportedly excluded from the field trip. On the evening of
the field trip, a certain Angel Madriaga, a sales officer of petitioners,
campaigned against the union in the forthcoming certification election.
 When the certification election was scheduled on October 11, 2004, the
employees were escorted from the field trip to the polling center in
Zambales to cast their votes. The remaining employees situated at the
SBFZ plant cast their votes as well. Due to the heavy pressure exerted
by petitioners, the votes for “no union” prevailed.
 3rD CAUSE: A memorandum was issued by petitioner Ben Huang
(Huang), Director for Gin Queen, informed its employees of the
expiration of the lease contract between Gin Queen and its lessor in
Castillejos, Zambales and announced the relocation of its office and
workers to Cabangan, Zambales.
 When the respondents, visited the site in Cabangan, discovered that it
was a “talahiban” or grassland. The said union officers and members
were made to work as grass cutters in Cabangan, under the supervision
of a certain Barangay Captain Greg Pangan. Due to these circumstances,
the employees assigned in Cabangan did not report for work. The other
employees who likewise failed to report in Cabangan were meted out
with suspension.
 In its defense, Petitioners also stress that they cannot be held liable for
ULP for the reason that there is no employer-employee relationship
between the former and respondents. Further, Gin Queen avers that its
decision to implement an enforced rotation of work assignments for
respondents was a management prerogative permitted by law, justified
due to the decrease in orders from its customers, they had to resort to
cost cutting measures to avoid anticipated financial losses. Thus, it
present concrete proof of its decreasing orders was due to the
impossibility of proving a negative assertion. It also asserts that the
transfer from Castillejos to Cabangan was made in good faith and solely
because of the expiration of its lease contract in Castillejos. It was of the
impression that the employees, who opposed its economic measures,
were merely motivated by spite in filing the complaint for ULP against
it.
ISSUES/HELD:
1. Whether or not ULP acts were committed by petitioners against
respondents.
ULP were committed by petitioners against respondents.Petitioners are being
accused of violations of paragraphs (a), (c), and (e) of Article 257 (formerly
Article 248) of the Labor Code,13 to wit:
Article 257. Unfair labor practices of employers.—It shall be unlawful for an
employer to commit any of the following unfair labor practices:
(a) To interfere with, restrain or coerce employees in the exercise of their right to
self-organization;
xxxx
© To contract out services or functions being performed by union members when
such will interfere with, restrain, or coerce employees in the exercise of their right
to self-organization;
xxxx
(e) To discriminate in regard to wages, hours of work, and other terms and
conditions of employment in order to encourage or discourage membership in any
labor organization. x x x
 The questioned acts of petitioners, namely: 1) sponsoring a field trip to
Zambales for its employees, to the exclusion of union members, before
the scheduled certification election; 2) the active campaign by the sales
officer of petitioners against the union prevailing as a bargaining agent
during the field trip; 3) escorting its employees after the field trip to the
polling center; 4) the continuous hiring of subcontractors performing
respondents’ functions; 5) assigning union members to the Cabangan
site to work as grass cutters; and 6) the enforcement of work on a
rotational basis for union members, taken together, reasonably support
an inference that, indeed, such were all orchestrated to restrict
respondents’ free exercise of their right to self-organization.
 The Court is of the considered view that petitioners’ undisputed actions
prior and immediately before the scheduled certification election, while
seemingly innocuous, unduly meddled in the affairs of its employees in
selecting their exclusive bargaining representative.
Dispositive: CA Ruling Affirmed. Except: ATTY’s fees deleted
Toyota Motors Workers Association v. NLRC
October 19, 2007 || J. Velasco
By: Rose Ann
FACTS:
The Union is a legitimate labor organization duly registered DOLE. It filed a
petition for certification election among the Toyota rank and file employees with
the NCMB. The certification election was conducted. Med-Arbiter Lameyra
certified the Union as the SEBA of all the Toyota rank and file employees. Toyota
challenged said Order via an appeal to the DOLE Secretary.
In the meantime, the Union submitted its CBA proposals to Toyota, but the latter
refused to negotiate in view of its pending appeal. Thus, the Union filed a notice
of strike with the NCMB. NCMB-NCR converted the notice of strike into a
preventive mediation case on the ground that the issue of whether or not the
Union is the SEBA of all Toyota rank and file employees was still unresolved by
the DOLE Secretary.
On February 21, 2001, 135 Union officers and members failed to render the
required overtime work, and instead marched to and staged a picket in front of
the BLR office in Intramuros, Manila. More than 200 employees staged mass
actions on February 22 and 23, 2001 in front of the BLR and the DOLE offices, to
protest the partisan and anti-union stance of Toyota.
Due to the deliberate absence of a considerable number of employees on
February 22 to 23, 2001, Toyota experienced acute lack of manpower in its
manufacturing and production lines, and was unable to meet its production
goals resulting in huge losses of PhP 53,849,991.
Toyota sent individual letters to some 360 employees requiring them to explain
why they should not be dismissed for their obstinate defiance of the company’s
directive to render overtime work on February 21, 2001, for their failure to
report for work on February 22 and 23, 2001, and for their participation in the
concerted actions which severely disrupted and paralyzed the plant’s
operations.
The Union filed with the NCMB another notice of strike for union busting
amounting to unfair labor practice.
The Union nonetheless submitted an explanation in compliance with the
notices sent by Toyota to the erring employees. The Union members explained
that their refusal to work on their scheduled work time for two consecutive days
was simply an exercise of their constitutional right to peaceably assemble and to
petition the government for redress of grievances. It further argued that the
demonstrations staged by the employees could not be classified as an illegal
strike or picket, and that Toyota had already condoned the alleged acts when it
accepted back the subject employees.
Toyota terminated the employment of 227 employees for participation in
concerted actions in violation of its Code of Conduct and for misconduct under
Article 282 of the Labor Code.
In reaction to the dismissal of its union members and officers, the Union went
on strike on March 17, 2001. From March 28, 2001 to April 12, 2001, the Union
intensified its strike by barricading the gates of Toyota’s Bicutan and Sta. Rosa
plants. The strikers prevented workers who reported for work from entering the
plants.
On March 29, 2001, Toyota filed a petition for injunction with a prayer for the
issuance of a TRO with the NLRC. It sought free ingress to and egress from its
Bicutan and Sta. Rosa manufacturing plants. NLRC issued a TRO against the
Union, ordering the removal of barricades and all forms of obstruction to ensure
free ingress to and egress from the company’s premises.
Meanwhile, Toyota filed a petition to declare the strike illegal with the NLRC
arbitration branch.
On April 10, 2001, the DOLE Secretary assumed jurisdiction over the labor
dispute and issued an Order certifying the labor dispute to the NLRC. In the
Order the DOLE Secretary gave a return to work directive and likewise ordered
Toyota to accept the returning employees under the same terms and conditions
obtaining prior to the strike or at its option, put them under payroll
reinstatement. The parties were also enjoined from committing acts that may
worsen the situation.
The Union ended the strike. The union members and officers tried to return to
work but were told that Toyota opted for payroll-reinstatement authorized by
the Order of the DOLE Secretary.
In the meantime, the Union filed an MR of the DOLE Secretary’s April 10, 2001
certification Order. SOLE denied. A petition for certiorari was filed in the CA.
Meanwhile, on May 23, 2001,despite the issuance of the DOLE Secretary’s
certification Order, several payroll-reinstated members of the Union staged a
protest rally in front of Toyotas Bicutan Plant bearing placards and streamers in
defiance of the April 10, 2001 Order.
Then, on May 28, 2001, around 44 Union members staged another protest
action in front of the Bicutan Plant. At the same time, some 29 payroll-reinstated
employees picketed in front of the Santa Rosa Plants main entrance, and were
later joined by other Union members.
On June 5, 2001, notwithstanding the certification Order, the Union filed another
notice of strike. The DOLE Secretary directed the second notice of strike to be
subsumed in the April 10, 2001 certification Order.
CA dismissed the Union’s petition for certiorari assailing the DOLE Secretary’s
April 10, 2001 Order.
Subsequently, the NLRC declared the strikes staged by the Union on February
21 to 23, 2001 and May 23 and 28, 2001 as illegal. Reasons:
• failed to comply with the procedural requirements of a valid strike
under Art. 263 of the Labor Code.
• for staging strikes after the DOLE Secretary assumed jurisdiction over
the Toyota dispute
CA affirmed NLRC with a modification, however, of deleting the award of
severance compensation to the dismissed Union members.
However, in its Resolution, the CA modified its decision by reinstating severance
compensation to the dismissed employees based on social justice.
ISSUE
WON the strikes conducted were illegal strikes—YES
WoN the Union Officers are liable—YES
WoN the participating Union members are liable—YES
WoN separation pay may be granted--NO
RATIO
THE ALLEGED PROTEST RALLIES IN FRONT OF THE OFFICES OF BLR AND
DOLE SECRETARY AND AT THE TOYOTA PLANTS CONSTITUTED ILLEGAL
STRIKES
February 2001 Strikes: ILLEGAL
While the facts in Philippine Blooming Mills Employees Organization are similar
in some respects to that of the present case, the Union fails to realize one major
difference: there was no labor dispute in Philippine Blooming Mills Employees
Organization. In the present case, there was an on-going labor dispute arising
from Toyotas refusal to recognize and negotiate with the Union, which was the
subject of the notice of strike filed by the Union on January 16, 2001.
Applying pertinent legal provisions and jurisprudence, the protest actions
undertaken by the Union officials and members on February 21 to 23, 2001 are
not valid and proper exercises of their right to assemble and ask government for
redress of their complaints, but are illegal strikes in breach of the Labor Code.
The Unions position is weakened by the lack of permit from the City of Manila to
hold rallies. The purported reason for these protest actions was to safeguard
their rights against any abuse which the med-arbiter may commit against their
cause. However, the Union failed to advance convincing proof that the med-
arbiter was biased against them. What comes to the fore is that the decision not
to work for two days was designed and calculated to cripple the manufacturing
arm of Toyota. It becomes obvious that the real and ultimate goal of the Union is
to coerce Toyota to finally acknowledge the Union as the sole bargaining agent
of the company. This is not a legal and valid exercise of the right of assembly and
to demand redress of grievance.
The Union failed to comply with the following requirements for a valid strike:
(1) a notice of strike filed with the DOLE 30 days before the intended date of
strike, or 15 days in case of unfair labor practice; (2) strike vote approved by a
majority of the total union membership in the bargaining unit concerned
obtained by secret ballot in a meeting called for that purpose; and (3) notice
given to the DOLE of the results of the voting at least seven days before the
intended strike. These requirements are mandatory and the failure of a union to
comply with them renders the strike illegal. The evident intention of the law in
requiring the strike notice and the strike-vote report is to reasonably regulate
the right to strike, which is essential to the attainment of legitimate policy
objectives embodied in the law.
Moreover, the February 2001 strikes are in blatant violation of Sec. D, par. 6 of
Toyotas Code of Conduct which prohibits inciting or participating in riots,
disorders, alleged strikes or concerted actions detrimental to [Toyotas] interest.
The penalty for the offense is dismissal. The Union and its members are bound
by the company rules, and the February 2001 mass actions and deliberate
refusal to render regular and overtime work on said days violated these rules.
March-April 2001 Strikes: ILLEGAL
They were initially legal as the legal requirements were met. However, when the
Union barricaded the gates of the Bicutan and Sta. Rosa plants and blocked the
free ingress to and egress from the company premises, these strikes were illegal
because unlawful means were employed. The acts of the Union officers and
members are in palpable violation of Art. 264(e), which proscribes acts of
violence, coercion, or intimidation, or which obstruct the free ingress to and
egress from the company premises.
May 2001 Strikes: ILLEGAL
The Union asserts that the rallies held on May 23 and 28, 2001 could not be
considered strikes, as the participants were the dismissed employees who were
on payroll reinstatement. It concludes that there was no work stoppage.
SC: While it may be conceded that there was no work disruption in the two
Toyota plants, the fact still remains that the Union and its members picketed and
performed concerted actions in front of the Company premises. This is a patent
violation of the assumption of jurisdiction and certification Order of the DOLE
Secretary, which ordered the parties to cease and desist from committing any
act that might lead to the worsening of an already deteriorated situation. While
there are no work stoppages, the pickets and concerted actions outside the
plants have a demoralizing and even chilling effect on the workers inside the
plants and can be considered as veiled threats of possible trouble to the workers
when they go out of the company premises after work and of impending
disruption of operations to company officials and even to customers in the days
to come.
UNION OFFICERS ARE LIABLE FOR UNLAWFUL STRIKES OR ILLEGAL ACTS
DURING A STRIKE
Art. 264(a) sanctions the dismissal of a union officer who knowingly
participates in an illegal strike or who knowingly participates in the commission
of illegal acts during a lawful strike.
The Union officials were in clear breach of Art. 264(a) when they knowingly
participated in the illegal strikes held from February 21 to 23, 2001, from March
17 to April 12, 2001, and on May 23 and 28, 2001.
MEMBERS LIABILITY DEPENDS ON PARTICIPATION IN ILLEGAL ACTS
Art. 264(a) of the Labor Code provides that a member is liable when he
knowingly participates in an illegal act during a strike. While the provision is
silent on whether the strike is legal or illegal, we find that the same is irrelevant.
As long as the members commit illegal acts, in a legal or illegal strike, then they
can be terminated. However, an ordinary striking worker cannot be terminated
for mere participation in an illegal strike.
No precise meaning was given to the phrase illegal acts (committed in a strike).
It may encompass a number of acts that violate existing labor or criminal laws,
such as the following:
(1) Violation of Art. 264(e) of the Labor Code which provides that [n]o person
engaged in picketing shall commit any act of violence, coercion or intimidation
or obstruct the free ingress to or egress from the employers premises for lawful
purposes, or obstruct public thoroughfares;
(2) Commission of crimes and other unlawful acts in carrying out the strike; and
(3) Violation of any order, prohibition, or injunction issued by the DOLE
Secretary or NLRC in connection with the assumption of
jurisdiction/certification Order under Art. 263(g) of the Labor Code.
This enumeration is not exclusive and it may cover other breaches of existing
laws.
After a scrutiny of the records, the 227 employees indeed joined the February
21, 22, and 23, 2001 rallies and refused to render overtime work or report for
work.
Anent the March 28 to April 12, 2001 strikes, evidence is ample to show
commission of illegal acts like acts of coercion or intimidation and obstructing
free ingress to or egress from the company premises. The strikers badmouthed
people coming in and shouted invectives such as bakeru at Japanese officers of
the company. The strikers even pounded the vehicles of Toyota officials. More
importantly, they prevented the ingress of Toyota employees, customers,
suppliers, and other persons who wanted to transact business with the
company. These were patent violations of Art. 264(e) of the Labor Code, and
may constitute crimes under the RPC such as threats or coercion among others.
Lastly, the strikers, though on payroll reinstatement, staged protest rallies on
May 23, 2001 and May 28, 2001 which are patent violations of the April 10,
2001 assumption of jurisdiction/certification Order issued by the SOLE, which
proscribed the commission of acts that might lead to the worsening of an
already deteriorated situation. Art. 263(g) is clear that strikers who violate the
assumption/certification Order may suffer dismissal from work.
SEPARATION PAY CANNOT BE GRANTED IN THIS CASE
GENERAL RULE: when just causes for terminating the services of an employee
under Art. 282 of the Labor Code exist, the employee is not entitled to
separation pay. The apparent reason behind the forfeiture of the right to
termination pay is that lawbreakers should not benefit from their illegal acts.
The dismissed employee, however, is entitled to whatever rights, benefits and
privileges [s/he] may have under the applicable individual or collective
bargaining agreement with the employer or voluntary employer policy or
practice or under the Labor Code and other existing laws.
One exception where separation pay is given even though an employee is validly
dismissed is when the court finds justification in applying the principle of social
justice well entrenched in the 1987 Constitution. In PLDT v. NLRC, the Court laid
down the rule that severance compensation shall be allowed only when the
cause of the dismissal is other than serious misconduct or that which reflects
adversely on the employees moral character.
Explicit in PLDT are two exceptions: serious misconduct (which is the first
ground for dismissal under Art. 282) or acts that reflect on the moral character
of the employee.
A painstaking review of case law renders obtuse the Unions claim for separation
pay. In a slew of cases, this Court refrained from awarding separation pay or
financial assistance to union officers and members who were separated from
service due to their participation in or commission of illegal acts during strikes.
Phil Blooming Mills Employment Org (PBMEO) v PBM Co. Inc.
June 5, 1973; Makasiar, J.:
By: Paola
FACTS:
1. PBMEO is a legitimate labor union composed of the employees of PBM Co.
393 members joined the demonstration at issue.
2. On March 1, 1969, they decided to stage a mass demonstration at
Malacañang on March 4, 1969, in protest against alleged abuses of the
Pasig police, to be participated in by workers in the first shift (6 AM to 2
PM), as well as those in the second (7 AM to 4 PM) and third (8 AM – 5PM)
shifts. The company was informed of the proposed demonstration.
3. On March 2, 1969, PBM Co. allegedly learned of the demonstration.
4. March 3: A meeting was again held between department heads for the
union and the management was called by the company on March 3, asking
that the union panel confirm or deny the mass demonstration. It was
confirmed by the union spokesperson Pacu.
a. Pacu, informed management that the demonstration cannot be
cancelled because it has already been agreed upon and explained
that it had nothing to do with the company bec. the union had no
quarrel with the management.
b. Management informed that the demonstration is an inalienable
right granted by the constitution, but emphasized that the
demonstration should not unduly prejudice the normal operations
of the company.
c. The company suggested that the first shift from 6am-2pm should
report to work in order to avoid loss or damage to the firm.
d. They warned that those in the 1st and 2nd shift who participate
without filing for leave, and who fail to report on the day of the
demonstration shall be dismissed for violating the “no strike no
lockout policy” provision in the CBA tantamount to an illegal
strike.
e. The union countered that it was too late to change their plans
sinche the demonstration will be held the following morning.
5. March 4, 1969: Adviser of PBMEO, Mr. Aniston, sent PBM Co a cablegram to
Company received 9:50 AM “reiterating request excuse day shift employees
joining demonstration march”
6. Because preparations had been made, the union proceeded with the
demonstration (400 union members went to the protest)
7. Complaint was filed by the company to the CIR for violation of section 4(a)-
6, in relation to sections 13 and 14 of RA 875 (Act to Promote Industrial
Peace) and their CBA.
8. In their answer, PBMEO said that:
a. They did not violate CBA because they notified PBM Co. prior to the
demonstration
 b. That the mass demonstration was a valid exercise of their
constitutional right of free speech against the abuses of Pasig
policemen.
c. That their demonstration was not a declaration of strike because it
was not directed against PBM Co.
9. CIR: PBMEO was guilty of bargaining in bad faith, and its officers
Florencio, Rufino, Marioano, Asecion, Bonifacio, Benjamin, Nicanor and
Rodulfo (petitioners here) were held directly responsible for perpetrating
the ULP, thus they were dismissed. Decision was allegedly received on
September 22, 1969.
10. An MR was filed on September 29. The company argues that under the CIR
Rules of Court, the petitioners had 5 days to file MR, and since it was filed 2
days late, the MR should be dismissed.
11. CIR on MR: dismissed for being filed beyond the reglementary period.
Decision was appealed to the SC.
ISSUES/HELD/RATIO:
W/N the Union was engaged in ULP for holding the demonstration – NO.
 The court went into a lengthy discussion about rights and freedoms, but
it highlighted that in the hierarchy of civil liberties, the rights of free
expression and assembly occupy a preferred position as they are
essential to the preservation and vitality of our civil and political
institutions […] [And] that while the Bill of Rights also protects
property rights, the primacy of human rights over property rights is
recognized.
 “Because there 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. If human rights are extinguished by the
passage of time, then the Bill of Rights is a useless attempt to limit the
power of government and ceases to be an efficacious shield against the
tyranny of officials, of majorities, of the influential and powerful, and of
oligarchs - political, economic or otherwise.
 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 superiority of these freedoms over property rights is underscored
by the fact that a mere reasonable or rational relation between the
means employed by the law and its object or purpose — that the
law is neither arbitrary nor discriminatory nor oppressive — would
suffice to validate a law which restricts or impairs property rights.
On the other hand, a constitutional or valid infringement of human
rights requires a more stringent criterion, namely existence of a grave
and immediate danger of a substantive evil which the State has the right
to prevent.”
 The CIR, after opining that the mass demonstration was not a
declaration of strike, concluded that by their “concerted act and the
occurrence temporary stoppage of work,” [sic] PBMEO is guilty of
bargaining in bad faith. HOWEVER, the CIR is incorrect
o The demonstration was against the abusive Pasig policemen,
not against PBM Co. Thus, they were merely exercising freedom
of expression in general and of the right of assembly and of
petition of redress of grievances in particular [before the Chief
Executive, the proper government agency, against abusive
policemen]
o “As a matter of fact, it was the duty of [PBM Co] to protect its
employees from the harassment of the police officers. It was to
the interest of [PBM Co] to rally in defense of, and take up the
cudgels for its employees so that they could report to work free
from harassment.”
o “The pretension of their employer that it would suffer loss or
damage by reason of the absence of its employees from 6 AM to
2 PM is a plea for the preservation merely of their property
rights […] Material loss can be repaired or adequately
compensated. The debasement of the human being — broken
in morale and brutalized in spirit — can never be fully
evaluated in monetary terms. The wounds fester and the scars
remain to humiliate him to his dying day, even as he cries in
anguish for retribution, denial of which is like rubbing salt on
bruised tissues.”
o To regard the demonstration against police officers, not against
the employer, as evidence of bad faith in collective bargaining
and hence a violation of the collective bargaining agreement
and a cause for the dismissal from employment of the
demonstrating employees, stretches unduly the compass of
the collective bargaining agreement, is "a potent means of
inhibiting speech"
o According to CIR the CBA fixes the work shift of the employees
and as such it imposes a duty on part of employees to observe
working hours. This strained construction, denying right to
stage a mass demonstration against police abuses during
working hours, constitutes a virtual tyranny over the mind
and life of workers.
 o 
o Injunction by court of the mass demonstration would be
trenching upon freedom of expression of workers.
o PBM Co claims that there was no need for all workers to
participate in the demonstration, to avoid loss or damage to th
firm. This stand fails to appreciate that the condition sine
qua non of an effective demonstration especially by the
labor union, is the complete unity of its members as well
as their total presence at the demonstration site in order to
generate maximum sympathy for the validity of their cause but
also immediate action from the government agency concerned.
o At any rate, Union notified PBM Co 2 days prior to
demonstration. There was a lack of human understanding or
compassion on the part of the firm in rejecting the request of
the Union for excuse from work for the day shifts in order to
carry out its mass demonstration
W/N PBM Co. is guilty of ULP – YES.
 The company is actually the one guilty of unfair labor practice.
Because refusal on the part of the company to permit all employees to
join the demonstration, and the subsequent dismissal of the 8
petitioners constituted an unconstitutional restraint on the freedom
of expression, assembly, and freedom to petition for redress of
grievances.
o The Company committed an unfair labor practice as defined in
Section 4(a-1) in relation to section 3 of the Industrial Peace
Act. Sec 3 guarantees the right of employees “to engage in
concerted activities for … mutual aid or protection”, while
4(a-1) makes it a ULP for an employer to interfere with,
restrain or coerce employees in the exercise of rights
granted in Sec. 3.
o Obviously, the facts show that the demonstration staged was
for their mutual aid and protection, and the company with its
threat of dismissal on the employees committed an act
interfering with the exercise of this right.
o Further, the CIR failed to make any finding as to the fact of
losses actually sustained by the firm. This can only mean
that firm did not sustain damage: no evidence to show it lost
expected profits, or that penalties were exacted by customers
whose orders could not be filled that day.
o The SC held that on the contrary, the company saved a sizable
amount in the form of wages for its hundreds of workers, cost
of fuel, water and electric consumption for that day [which
could amply compensate unrealized profits or damage that
day] lol
W/N dismissal of the 8 leaders valid –NO.
 The dismissal of the 8 leaders is also contrary to the principles of social
justice enunciated in the Constitution [promotion of social justice to
insure economic security of all people; and protection to labor]
 Further, the violation of the employees’ constitutional right divested the
CIR of jurisdiction, and as a consequence, its judgment is null and void
and confers no rights.
Does the fact that the MR was filed 2 days late defeat the rights if the
employees – NO.
 The rules of procedure here were promulgated by the CIR pursuant to
legislative legislation.
 According to the SC, the constitution is superior to any statute or
subordinate rules. The court highlighted that the rights involved in this
case were the rights of free expression, assembly and petition.
o It is an accepted principle that the SC has the inherent power to
“suspend its own rules or to except a particular case from its
operation, whenever the purposes of justice require.”
o The suspension of the provision involved (Sec 15) is also
authorized by the CIR charter, which enjoins the CIR to “act
according to justice and equity and substantial merits of the
case, without regard to technicalities or legal forms…”
o These doctrines have been upheld in Kapisanan v Hamilton,
Palma v Oreta.
 Even if the CIR orders were to be given effect, the dismissal or
termination of the 8 leaders is harsh for a 1 day absence in work. The
appropriate penalty—if any at all is deserved—should have been
to charge the one day absence against vacation or sick leave.
 Management has shown not only lack of good-will or good intention,
but a complete lack of sympathetic understanding of the plight of its
laborers who claim that they are being subjected to indignities by the
local police.
Dismissed 8 employees should be reinstated with full back pay from date of
separation from service
Biflex Phils Inc Labor Union (NAFLU) v. Filflex Industrial and Biflex Phils.
Inc.
December 19, 2006 / Carpio-Morales, J.
Digest by Cate Alegre
Summary
There was a welga ng bayan. Two labor unions, on the date such welga was held joined in
and conducted work stoppage and prevented ingress and egress at their office.
Management claimed that such work stoppage was illegal. SC sided with management
claiming what the union did was in the nature of sympathy strike, did not follow the
proper procedure in staging a strike, and assuming arguendo that the procedural rules
were followed, the act of preventing ingress and egress was also illegal
Doctrine
Employees who have no labor dispute with their employer but who, on a day they are
scheduled to work, refuse to work and instead join a welga ng bayan commit an illegal
work stoppage. Even if petitioners’ joining the welga ng bayan were considered merely as
an exercise of their freedom of expression, the exercise of such rights is not absolute. For
the protection of other significant state interests such as the "right of enterprises to
reasonable returns on investments, and to expansion and growth" enshrined in the 1987
Constitution must also be considered. The legality of a strike is determined not only by
compliance with its legal formalities but also by the means by which it is carried out.
FACTS:
 The unions involved in this case were Biflex (Phils) Inc. Labor Union and Filflex
Industrial and Manufacturing Labor Union (Petitioners), which are affiliated with
National Federation of Labor Unions (NAFLU).
o Unions are the respective collective bargaining agents of the employees of the
corporations
 Biflex (Phils.) Inc. and Filflex Industrial and Manufacturing Corporation
(Respondents) are sister companies engaged in garment business. They are situated
in one big compound and have a common entrance
 October 24, 1990 – a welga ng bayan was staged to protest the oil price hike.
Petitioners also staged a work stoppage to join the welga which lasted for several days.
o October 31 - Respondents filed a petition to declare the work stoppage illegal
for failure to comply with procedural requirements
 November 13, 1990 – upon resumption of operations, Petitioners claimed that they
were illegally locked out by the respondents.
o Respondents were slighted by their no-show and as a punishment they were
barred from the company premises
o They placed tents, tables and chairs in front of the main gate because these
were for the convenience of union members who check everyday if they will be
allowed to go back to work (basically saying that they didn’t conduct a strike)
 Respondents – the work stoppage was illegal since they failed to comply with the
following: (1) filing of notice of strike; (2) securing a strike vote, and (3) submission of
a report of the strike vote to the Department of Labor and Employment
 LA – strike was illegal! Respondents then terminated the employment of petitioners’
union members
 NLRC – reversed
 CA – reversed NLRC and reinstated LA
ISSUE: WON the strike was illegal? YES
RATIO
 Stoppage of work due to welga ng bayan is in the nature of a general strike, an
extended sympathy strike. It affects numerous employers including those who do not
have a dispute with their employees regarding their terms and conditions of
employment.
o Even if petitioners’ joining the welga ng bayan were considered merely as an
exercise of their freedom of expression, freedom of assembly or freedom to
petition the government for redress of grievances, the exercise of such rights is
not absolute.
o The “right of enterprises to reasonable returns on investments and to expansion
and growth” which is enshrined in the 1987 Constitution must also be considered.
 There being no showing that petitioners notified respondents of their intention, or that
they were allowed by respondents, to join the welga ng bayan, their work stoppage is
beyond legal protection.
 Even assuming arguendo that in staging the strike, petitioners had complied with legal
formalities, the strike would just the same be illegal, for by blocking the free
ingress to and egress from the company premises, they violated Article 264(e) of
the Labor Code which provides that "[n]o person engaged in picketing shall … obstruct
the free ingress to or egress from the employer’s premises for lawful purposes, or
obstruct public thoroughfares."
 In fine, the legality of a strike is determined not only by compliance with its legal
formalities but also by the means by which it is carried out. Article 264 (a) of the Labor
Code provides:
. . . Any union officer who knowingly participates in an illegal strike and any
worker or union officer who knowingly participates in the commission of illegal
acts during a strike may be declared to have lost his employment
status: Provided, That mere participation of a worker in a lawful strike shall not
constitute sufficient ground for termination of his employment, even if a
replacement had been hired by the employer during such lawful strike.
 In Gold City Integrated Port Service, Inc. v. National Labor Relations Commission,22 this
Court, passing on the use of the word "may" in the immediately quoted provision, held
that "[t]he law . . . grants the employer the option of declaring a union officer who
participated in an illegal strike as having lost his employment." Reinstatement of a
striker or retention of his employment, despite his participation in an illegal strike, is a
management prerogative which this Court may not supplant.
Hyatt Enterprises, 588 SCRA 497
YSS Employees Union v. YSS Laboratories
December 4, 2009 | Chico-Nazario, J.
By: Jadd
SUMMARY:
YSS implemented a retrenchment program to avoid increasing business losses.
YSS terminated the services of 11 employees (including union members and
officers) when no one availed of early retirement. The Union staged a strike
after the NCMB supervised the strike vote. After the NCMB’s conciliation
proceedings failed, the SOLE certified the dispute to the NLRC for compulsory
arbitration, and issued a return to work order. YSS refused to readmit 9 union
officers and members alleging a valid retrenchment and illegal strike. The SOLE
found for the Union and ordered their readmission, but the CA reversed the
SOLE. The SC reversed the CA, and granted the Union’s Petition for Review on
Certiorari, holding that YSS should readmit all striking employees, including the
retrenched ones, because allowing the employer to decide which strikers should
be admitted back to work would strip the certification/AJO of the necessary
coercive power and violate their compulsory and executory nature.
DOCTRINE:
Employers are not allowed to determine which strikers should be covered by a
return-to-work-order because it is compulsory and executory, aimed at serving
the national interest by preserving the status quo ante and industrial peace.
FACTS:
 The Union (YSS EU) is a duly-registered labor organization, and is the
SEBA of YSS’ rank-and-file employees.
 YSS implemented a retrenchment program to avoid increasing business
losses.
o 11 employees8 were affected, and allegedly chosen in
accordance with the company’s reasonable standards as
established. 4 were union officers9 while 5 were union
members10.
o At first, they were given the option to avail of YSS’ early
retirement program.
o When no one availed of early retirement, YSS exercised its
option to terminate their services based on Art. 289 (then
283).
8
Resie Santos, Edwin Perona, Rogelio Salmorin, Joselina Victoria, Dominador Monterola, Jacqueline
Tubale, Loreto Esteves, Jetner Argamaso, Teofilo Pagaduan, Jr., Bernardita Mesias and Alexander
Reig.
9 of employment prior to the strike.
Secretary - Joselina Victoria, Auditor - Edwin Perona, Rogelio Salmorin - PRO, Teofilo Pagaduan, Jr. -
Board Member
10
Resie Santos, Dominador Monterola, Jacqueline Tubale, Loreto Esteves, Jetner Argamaso
 March 19, 2001 – Copies of the termination notices were served on the
DOLE.
 March 20, 2001 – Copies of the termination notices were served on the
employees concerned.
 April 20, 2001 – The Union staged a strike after the strike vote was
taken under the NCMB’s supervision.
 The NCMB’s conciliation proceedings were unsuccessful.
 May 11, 2001 – SOLE certified the dispute to the NLRC for compulsory
arbitration. The RTWO (Return to Work Order) directed the employees
to return to work within 24 hours from receipt, and directed YSS to
accept them under pre-strike terms and conditions.11
o YSS refused to comply.
 YSS’ Urgent MR argued that the 9 union officers and
members should be excluded due to valid
retrenchment and participating in an illegal strike.
o The Union moved to cite YSS in contempt.
 June 9, 2001 – The SOLE found for the Union, ordering YSS to
immediately accept back to work the 9 retrenched employees and 9
union officers who allegedly initiated the strike, or otherwise reinstate
them in the payroll if actual reinstatement was not possible.
 November 26, 2001 – The CA granted YSS’ Petition for Certiorari, and
reversed the SOLE’s orders, finding that there was a valid retrenchment
and that the strike was illegal.
 August 29, 2002 – The CA denied the Union’s MR.
 The Union goes up to the SC through a Petition for Review on Certiorari.
ISSUES/HELD: WON the retrenched employees should be part of the return to
work order? – YES
RATIO:
Yes, the retrenched employees should be part of the RTWO. YSS failed to show
that the SOLE gravely abused its discretion by issuing the orders in an
arbitrary/despotic manner. The national interest is served by preserving the
status quo ante and industrial peace pending determination of the main issues,
which is why the orders (AJO, RTWO) are compulsory and executory.
1) Character of SOLE’s labor dispute powers: Plenary and broad, with
wide latitude of discretion to adopt the most expeditious and
11
CONSIDERING THESE PREMISES, this Office hereby certifies the labor dispute at [YSS
Laboratories] to the [NLRC] for compulsory arbitration, pursuant to Article [269](g) of the Labor
[Code], as amended.
All striking workers are hereby directed to return to work within twenty four (24) hours from
receipt of this Order and for the Company to accept them back under the same terms and conditions
The parties are further directed to cease and desist from committing any act which might further
worsen the situation.
Let the entire records of this case be forwarded to the NLRC for its appropriate action.
 reasonable way to resolve the issue. (Citing Telefunken Semiconductors C) Requisite – So patent and gross as to amount to an evasion of a
Employees Union v. CA (2000)) positive duty or to a virtual refusal to perform a duty enjoined by
2) On the Assumption of Jurisdiction (AJO) law, or to act at all in contemplation of law, as where the power is
A) Character – The assumption of jurisdiction in Art. 269(g) is the exercised in an arbitrary and despotic manner by reason of passion
State’s exercise of police power for the common good. (Citing or personal hostility. (Citing Philtread Workers Union (PTWU) v.
Phimco Industries, Inc. v. Acting Secretary of Labor Brillantes Confesor, (1997))
(1999)) 6) In this case: There was no grave abuse of discretion.
1. Police Power A) YSS failed to prove that the SOLE issued the orders in an
a. Definition – A government's inherent power to enact laws arbitrary/despotic manner.
to promote society's order, safety, health, and general B) The orders were issued to preserve the status quo ante and
welfare, within constitutional limits. industrial peace while the main issues (retrenchment validity and
b. Character – Inherent and does not need explicit strike legality) were being decided in the proper forum. This
constitutional basis. (Citing Philtread Workers Union protects the common good because a continued strike is against the
(PTWU) v. Confesor (1997)) employer and employee’s interest.
B) Purpose of granting the assumption of jurisdiction power to the C) YSS’ assertion of the retrenchment’s validity and the strike’s
SOLE – Enable the SOLE to quickly, fairly, and justly resolve the illegality as grounds for not accepting certain employees violates
dispute to minimize or avert damage to the national interest by the compulsory and executory character of AJOs and compulsory
avoiding work stoppage or industrial activity lag, or even just the arbitration certifications.
threat of such. (Citing Telefunken Semiconductors Employees Union D) YSS must readmit all striking employees.
v. CA (2000)) 7) Allowing the employer to decide which strikers should be admitted
C) Effects upon the strike/lockout (Citing Trans-Asia Shipping Lines, back to work would strip the certification/AJO of the necessary coercive
Inc.-Unlicensed Crews Employees Union-Associated Labor Unions power.
(Tasli-Alu) v.CA (2004)):
i. If it has not yet taken place – Automatically enjoined
ii. If it has taken place – Striking workers return to work, and
employer shall immediately resume operations and readmit all
workers under the same terms and conditions prevailing
before the strike/lockout.
3) On Compulsory Arbitration Certification
A) Purpose – Quick dispute resolution, not interference with
management rights.
B) Regarding the dynamics between the SOLE and labor arbiters as
seen in Art. 269(g) – The provision means for shared jurisdiction
between the SOLE and labor arbiters, subject to certain conditions.
Otherwise, the SOLE would not be able to effectively and efficiently
dispose of the primary dispute, and there might be conflicting
rulings. This interpretation of the provision breathes life into it,
rather than defeating it. (Citing International Pharmaceuticals, Inc.
v. SOLE, 1999)
4) On Return to Work Orders
A) Character – Compulsory and executory.
B) Effect – Must be obeyed until set aside. (Citing PALEA v. PAL, 1971)
C) Basis – A court’s exercise of its compulsory arbitration power.
5) On Grave Abuse of Discretion
A) Definition – Capricious and whimsical exercise of judgment.
B) Effect – Equivalent to lack of jurisdiction. Solid Bank, 634 SCRA 554
Phimco v. Pila
2010 August 11 | Brion, J.
By: Jocs Dilag
SUMMARY:
Union filed NOS, conducted a strike vote, submitted the results to NCMB and 35
days later, staged a strike. ER dismissed 10 Union officers & 36 mems for illegal
acts committed during the strike. SC held strike illegal. Even if Union complied
w/ the procedural requirements of a valid strike, the strike is illegal for the
illegal acts committed when they blocked the free ingress to and egress from
company’s premises and picket attended with intimidation. Art 264/278(a)
makes a distinction on the liabilities of participating workers and Union officers
(see below). In this case, the participating Union officers and members stand to
be dismissed.
DOCTRINE: (Strikes, Lockouts, and Picketing)
While the right of employees to publicize their dispute falls within the
protection of freedom of expression and the right to peaceably assemble to air
grievances, these rights are by no means absolute. Protected picketing does
not extend to blocking ingress to and egress from the company premises.
Pickets may not aggressively interfere with the right of peaceful ingress to and
egress from the employer’s shop or obstruct public thoroughfares; picketing is
not peaceful where the sidewalk or entrance to a place of business is
obstructed by picketers parading around in a circle or lying on the sidewalk.
Article 264(e) of the Labor Code tells us that picketing carried on with violence,
coercion or intimidation is unlawful. According to American jurisprudence, what
constitutes unlawful intimidation depends on the totality of the
circumstances. Force threatened is the equivalent of force exercised. There may
be unlawful intimidation without direct threats or overt acts of violence. Words
or acts which are calculated and intended to cause an ordinary person to fear an
injury to his person, business or property are equivalent to threats.
FACTS:
 CBA was about to expire so Phimco, manufacturer of matches (posporo) &
PILA negotiated for its renewal, which resulted in a deadlock on economic
issues: disagreements on salary increases and benefits.
 Mar 1995: PILA filed w/ NCMB a Notice of Strike on the ground of the
bargaining deadlock.
 Mar.16: Union conducted a strike vote - majority voted in favor of strike
 Mar.17: Union filed strike vote results w/ NCMB.
 Apr.21: Union staged a strike.
 May 3: Phimco filed w/ NLRC a petition for preliminary injunction and
TRO, to enjoin the strikers from preventing the ingress and egress of non-
striking EEs into and from the company premises. →ex-parte TRO issued,
valid for 20 days
 June 23: Phimco sent a letter to 36 Union members, directing them to
explain within 24 hours why they should not be dismissed for the illegal
acts they committed during the strike.
 June 26: These 36 Union members were informed of their dismissal.
 Union filed a complaint for ULP and illegal dismissal (Case 1).
 Acting SOLE Brillantes assumed jurisdiction, and issued return-to-work
order for all the striking employees (except those 36 terminated) and for
Phimco to re-admit them. Union ended strike on the same day.
 Phimco filed a petition to declare strike illegal w/ prayer for the dismissal
of PILA officers and members who knowingly participated in the illegal
strike (Case 2): strikers prevented ingress to and egress, paralyzing
company’s operations.
 Respondents filed their position paper: They complied with all the legal
requirements for staging strike, put up no barricade, and conducted strike
peacefully, in an orderly and lawful manner, without incident.
 LA (Case 2): Illegal strike; prohibited acts committed during the strike by
blocking ingress and egress of company’s premises and preventing the
non-striking EEs from reporting for work.
 NLRC: Set aside LA. Union conducted a peaceful moving picket.
 LA (Case 1): Illegal dismissal. Reinstatement w/ backwages.
 NLRC: Consolidated 2 cases. Ruled in favor of Union. Case 2: not an illegal
blockade, did not obstruct ingress and egress, moving picket was moving.
Case 1: striking EEs not given ample opportunity to explain their side.
 Without waiting for the result of MR, Phimco elevated its case to CA
through a petition for certiorari under Rule 65.
 CA: Dismissed petition (in favor of Union). Hence, present petition for
review on certiorari.
ISSUES/HELD:
WoN Union’s strike was legal – NO
RATIO:
In the present case, Union fully satisfied the legal procedural requirements
for staging a strike. However, despite the validity of the purpose of a strike
and compliance with the procedural requirements, a strike may still be
held illegal.
Commission of Prohibited Acts
A strike may still be held illegal where the means employed are illegal, as
provided under Art.264 (now 278) (e):
No person engaged in picketing shall commit any act of violence, coercion or
intimidation or obstruct the free ingress to or egress from the employer's
premises for lawful purposes, or obstruct public thoroughfares.
Based on SC’s examination of the evidence, it found the strike illegal. 1 While
the strike undisputedly had not been marred by actual violence and patent
intimidation, the picketing that Union undertook as part of its strike
activities effectively blocked the free ingress to and egress from Phimco’s
premises, thus preventing non-striking EEs and company vehicles from
entering. In this manner, the picketers violated Art.264/278(e).
While a strike focuses on stoppage of work, picketing focuses on
publicizing the labor dispute and its incidents to inform the public of what is
happening in the company struck against.
(See doctrine) While the right of employees to publicize their dispute falls
within the protection of freedom of expression and the right to peaceably
assemble to air grievances, these rights are by no means absolute. Protected
picketing does not extend to blocking ingress to and egress from the company
premises.
As applied.
That the picket was moving, was peaceful and was not attended by
actual violence may not free it from taints of illegality if the picket
effectively blocked entry to and exit from the company premises.
Significantly, the photographs taken of the strike area, capturing the
strike in its various stages and showing how the strikers actually
conducted the picket, validated the testimonies adduced. While the picket is
moving, the movement was in circles, very close to the gates, with the
strikers in a hand-to-shoulder formation without a break in their ranks,
thus preventing non-striking workers and vehicles from coming in and getting
out. Supported by actual blocking benches and obstructions, what the
union demonstrated was a very persuasive and quietly intimidating strategy
whose chief aim was to paralyze the operations of the company, not solely
by the work stoppage of the participating workers, but by excluding the
company officials and non-striking employees from access to and exit from
the company premises. No doubt, the strike caused the company operations
considerable damage. The blockade even went to the point of causing the build
up of traffic in the immediate vicinity of the strike area.
Intimidation (see doctrine)
Art.264/278(e) likewise provides that picketing carried on with violence,
coercion or intimidation is unlawful. The manner in which the respondent
union officers and members conducted the picket had created such an
intimidating atmosphere that non-striking employees and even company
vehicles did not dare cross the picket line, even with police intervention. 2 Those
who dared cross the picket line were stopped. The testimonies of non-striking
employees, who were prevented from gaining entry into the company premises,
and confirmed no less by two officers of the union, are on record.
Liabilities of union officers and members
As explained in Samahang Manggagawa sa Sulpicio Lines, Inc.-NAFLU v.
Sulpicio Lines, Inc., the effects of illegal strikes, outlined in Art.264/278(a), make
a distinction between participating workers and union officers. The services of
an ordinary striking worker cannot be terminated for mere participation
in an illegal strike; proof must be adduced showing that he or she
committed illegal acts during the strike. The services of a participating
union officer, on the other hand, may be terminated, not only when he
actually commits an illegal act during a strike, but also if he knowingly
participates in an illegal strike.
In all cases, the striker must be identified. Substantial evidence, available
under the attendant circumstances, suffices to justify the imposition of the
penalty of dismissal.
In the present case, the 10 respondent Union officers stand to be dismissed
as participating union officers, while the 37 respondent Union members stand
to be dismissed for their illegal acts in the conduct of the union’s strike as
Phimco was able to individually identify them thru the affidavits of co-
employees (Panis and Ortiz) and Personnel Manager Cinco, and photographs.
Phimco failed to observe due process
Phimco violated the twin-notice requirements of due process under LC when
it dismissed the respondents: (1) a written notice specifying the grounds for
termination and giving the employee a reasonable opportunity to explain his
side and (2) another written notice indicating that, upon due consideration of
all circumstances, grounds have been established to justify the employer's
decision to dismiss the employee.
In the present case, it does not appear that the Union officers were
specifically informed of the charges against them and given the chance to
explain and present their side. As to the Union members, only 36 Union
members were notified of the charges against them, but they were not given an
ample opportunity to be heard and to defend themselves.
Therefore, apply Agabon ruling: Employer, despite the just cause for
dismissal, must pay the dismissed workers nominal damages (P30K) as
indemnity for the violation of the workers’ right to statutory due process.
STA ROSA COCA-COLA PLANT EMPLOYEES UNION, et al. V. COCA-COLA
BOTTLERS PHILS., INC.
January 24, 2007 | Callejo, Sr., J.
Prof. Sobreviñas for Coca-Cola Bottlers.
SUMMARY: When the negotiation for CBA reached an impasse, the union, by
virtue of the mayor’s permit, conducted a picketing where union members and
officers left their works for 3 hrs and marched to and fro on the side of the
highway. The company filed a case to declare the activity as a strike and an
illegal one at that. The contention is on whether the said acts constitute a strike.
The SC ruled that it was a strike and not a mere picketing, using the definition of
a strike in the LC.
DOCTRINE: Art. 212, LC defines strike as a temporary stoppage of work by the
concerted action of employees as a result of an industrial or labor dispute. In
Bangalisan v. Court of Appeals, the Court ruled that “the fact that the
conventional term ‘strike’ was not used by the striking employees to describe
their common course of action is inconsequential, since the substance of the
situation, and not its appearance, will be deemed to be controlling. The term
“strike” encompasses not only concerted work stoppages, but also slowdowns,
mass leaves, sit-downs, attempts to damage, destroy or sabotage plant
equipment and facilities, and similar activities. . . what is definitive of whether
the action staged by petitioners is a strike and not merely a picket is the totality
of the circumstances surrounding the situation.
FACTS:
The Sta. Rosa Coca-Cola Plant Employees Union (Union) is the SEBA of the
regular daily paid workers and the monthly paid non-commission-earning
employees of the Coca-Cola Bottlers Philippines, Inc. (Company) in its Sta. Rosa,
Laguna plant.
Upon the expiration of the CBA, the Union informed the Company of its desire to
renegotiate its terms. The CBA meetings commenced on July 26, 1999, where
the Union and the Company discussed the ground rules of the negotiations. The
Union insisted that representatives from the Alyansa ng mga Unyon sa Coca-Cola
be allowed to sit down as observers in the CBA meetings. The Union officers and
members also insisted that their wages be basedon their work shift rates. For its
part, the Company was of the view that the members of the Alyansa were not
members of the bargaining unit. The Alyansa was a mere aggregate of
employees of the Company in its various plants; and is not a registered labor
organization. Thus, an impasse ensued.
On August 30, 1999, the Union, its officers, directors and six shop stewards filed
a “Notice of Strike” with the NCMB. The Company filed a Motion to Dismiss
alleging that the reasons cited by the Union were not valid grounds for a strike.
The Union then filed an Amended Notice of Strike.
Meanwhile, the Union decided to participate in a mass action organized by the
Alyansa in front of the Company’s premises. 106 Union members, officers and
members of the BoD, and shop stewards, individually filed applications for leave
of absence for September 21, 1999. Certain that its operations in the plant
would come to a complete stop since there were no sufficient trained
contractual employees who would take over, the Company disapproved all leave
applications and notified the applicants accordingly. A day before the mass
action, some Union members wore gears, red tag cloths stating "YES KAMI SA
STRIKE" as headgears and on the different parts of their uniform, shoulders and
chests.
The Office of the Mayor issued a permit to the Union, allowing it "to conduct a
mass protest action within the perimeter of the Coca-Cola plant on September
21, 1999 from 9:00 a.m. to 12:00 noon." Thus, the Union officers and members
held a picket along the front perimeter of the plant on September 21, 1999. All
of the 14 personnel of the Engineering Section of the Company did not report
for work, and 71 production personnel were also absent. As a result, only one of
the three bottling lines operated during the day shift. All the three lines were
operated during the night shift with cumulative downtime of five (5) hours due
to lack of manning, complement and skills requirement. The volume of
production for the day was short by 60,000 physical cases versus budget.
On October 13, 1999, the Company filed a “Petition to Declare Strike Illegal”
alleging that the mass concerted action was clearly a strike and since the Union
did not observe the requirements mandated by law, i.e., strike vote, cooling-off
period and reporting requirements, the strike was therefore illegal. The NCMB
recommended that the Notice of Strike of the Union be converted into a
preventive mediation case. After conciliation proceedings failed, the parties
were required to submit their respective position papers. LA declared the strike
illegal. NLRC affirmed LA. CA dismissed petition.
The Union answered by alleging that it was not a strike but just a valid exercise
of their right to picket, which is part of the right of free expression as
guaranteed by the Constitution.
LA: the mass leave was a strike under art. 212, LC:
1) Union itself admitted that on the said date, members and officers did not
report for work. Instead, they all assembled in front of the Sta. Rosa Plant
and picketed the premises. Very clearly, there was a concerted action here
on the part of the respondents brought about a temporary stoppage of work
at two out of three bottling lines at the Sta. Rosa Plant
2) It is evident that respondents’ concerted activity resulted in a temporary
stoppage of work at the Sta. Rosa Plant of the company
3) Such concerted activity by respondents was by reason of a labor dispute
The strike was illegal since there was no showing that the Union conducted a
strike vote, observed the prescribed cooling-off period, much less, submitted a
strike vote to the DOLE within the required time. Consequently, for knowingly
participating in the illegal strike, the individual petitioners were considered to
have lost their employment status.
NLRC and CA: affirmed LA.
ISSUES:
1. WON the mass action was a strike? – YES
2. If in the affirmative, was it legal - NO
3. WON the individual officers and shop stewards of petitioner Union be
dismissed from their employment? – YES
RATIO:
The mass action was a strike
Union: It was not a strike but a picket, a valid exercise of their constitutional
right to free expression and assembly. It was a peaceful mass protest action to
dramatize their legitimate grievances against respondent.
 They did not intend to have work stoppage as they knew beforehand
that there was no bottling operation scheduled on that day.
 They applied for leaves of absences.
 They obtained a mayor’s permit and they faithfully complied with the
conditions therein.
 They merely marched to and fro at the side of the highway, did not
block ingress or egress of company’s premises.
 Request to hold the activity for 4 hrs was reduced to 3 hrs and they all
went back to work after.
 IBM-KMU in San Fernando Plant staged simultaneous walkout from
work and there the SOLE declared the walkout as a mass action and not
a strike. Coca-Cola accepted the SOLE’s decision. It should likewise
apply here.
SC: It was a strike and not a mere picket. The factual findings of LA that it was a
strike which was affirmed by both the NLRC and CA are conclusive to the SC.
Strike: Art. 212, LC defines strike as a temporary stoppage of work by the
concerted action of employees as a result of an industrial or labor dispute. The
fact that the conventional term ‘strike’ was not used by the striking employees
to describe their common course of action is inconsequential, since the
substance of the situation, and not its appearance, will be deemed to be
controlling. The term “strike” encompasses not only concerted work stoppages,
but also slowdowns, mass leaves, sit-downs, attempts to damage, destroy or
sabotage plant equipment and facilities, and similar activities. (Bangalisan vs
CA)
Picketing: involves merely the marching to and fro at the premises of the
employer, usually accompanied by the display of placards and other signs
making known the facts involved in a labor dispute. As applied to a labor
dispute, to picket means the stationing of one or more persons to observe and
attempt to observe. The purpose of pickets is said to be a means of peaceable
persuasion.
Labor dispute: includes any controversy or matter concerning terms or
conditions of employment or the association or representation of persons in
negotiating, fixing, maintaining, changing or arranging the terms and conditions
of employment, regardless of whether the disputants stand in the proximate
relation of employer and employee.
ICAB, there was a labor dispute. The basic elements of a strike are present in
this case: 106 members of petitioner Union, whose respective applications for
leave of absence on September 21, 1999 were disapproved, opted not to report
for work on said date, and gathered in front of the company premises to hold a
mass protest action. Petitioners deliberately absented themselves and instead
wore red ribbons, carried placards with slogans such as: “YES KAMI SA STRIKE,”
“PROTESTA KAMI,” “SAHOD, KARAPATAN NG MANGGAGAWA IPAGLABAN,”
”CBA-‘WAG BABOYIN,” “STOP UNION BUSTING.” They marched to and fro in
front of the company’s premises during working hours. Thus, petitioners
engaged in a concerted activity which already affected the company’s
operations. The mass concerted activity constituted a strike. Mayor’s permit is
not conclusive evidence that their action/activity did not amount to a strike. The
Mayor’s description of what activities petitioners were allowed to conduct is
inconsequential. What is definitive of whether the action staged by petitioners is
a strike and not merely a picket is the totality of the circumstances surrounding
the situation.
On the illegality of the strike
Art. 263 states the requirements for a strike to be valid 12. The said requirements
are MANDATORY. In the case at bar, the union totally ignored the requirements.
There is no showing that respondents had observed the prescribed cooling-off
period, conducted a strike vote, much less submitted a strike vote report to the
Department of Labor within the required time. . . the intention of the law in
requiring the strike notice and strike-vote report as mandatory requirements is
to reasonably regulate the right to strike which is essential to the attainment of
legitimate policy objectives embodied in the law. Verily, substantial compliance
12
Art. 263 of the Labor Code must be observed: (a) a notice of strike filed with the DOLE 30 days before the
intended date thereof, or 15 days in case of unfair labor practice; (b) strike vote approved by a majority of the total
union membership in the bargaining unit concerned obtained by secret ballot in a meeting called for that purpose,
(c) notice given to the DOLE of the results of the voting at least seven days before the intended strike.
with a mandatory provision will not suffice. Strict adherence to the mandate of
the law is required.
Aside from the above infirmity, the strike staged by respondents was, further, in
violation of the CBA13. The union had not referred their issues to the grievance
machinery as a prior step. Instead, they chose to go on strike right away, thereby
bypassing the required grievance procedure dictated by the CBA.
On shop stewards being considered as officers
Under Section 501(a) and (b) of the Landrum Griffin Act of 1959 14, shop
stewards are officers of the Union. Admittedly, there is no similar provision in
the Labor Code of the Philippines; nonetheless, petitioners who are shop
stewards are considered union officers:
Officers normally mean those who hold defined offices. An officer is any person
occupying a position identified as an office. An office may be provided in the
constitution of a labor union or by the union itself in its CBA with the employer.
The union’s constitution and by-laws define the position of a shop steward. 15
Likewise, sec. 6, rule 19, book 5 of the Implementing rules of the LC provides the
duties of a shop steward.
Thus, a shop steward is appointed by the Union in a shop, department, or plant
serves as representative of the Union, charged with negotiating and adjustment
of grievances of employees with the supervisor of the employer.
The jurisdiction of shop stewards and the supervisors includes the
determination of the issues arising from the interpretation or even
implementation of a provision of the CBA, or from any order or memorandum,
circular or assignments issued by the appropriate authority in the
establishment. In fine, they are part and parcel of the continuous process of
grievance resolution designed to preserve and maintain peace among the
employees and their employer. They occupy positions of trust and laden with
awesome responsibilities.
In this case, instead of playing the role of "peacemakers" and grievance solvers,
the petitioners-shop stewards participated in the strike. Thus, like the officers
and directors of petitioner Union who joined the strike, petitioners-shop
stewards also deserve the penalty of dismissal from their employment.

13
SECTION 1, Art. VI - The UNION agrees that there shall be no strike, walkout, stoppage or slowdown of work,
boycott, secondary boycott, refusal to handle any merchandise, picketing, sitdown strikes of any kind, sympathetic
or general strike, or any other interference with any of the operations of the COMPANY during the term of this
Agreement, so long as the grievance procedure for which provision is made herein is followed by the COMPANY.
14

Sec. 501 (a) The officers, agents, shop stewards, and other representatives of a labor organization occupy positions of
trust in relation to such organization and its members as a group. It is, therefore, the duty of each such person, taking
into account the special problems and functions of a labor organization, to hold its money and property solely for the
benefit of the organization and its members and to manage, invest, and expend the same in accordance with its
constitution and bylaws and any resolutions of the governing bodies adopted thereunder, to refrain from dealing with
such organization as an adverse party in any matter connected with his duties and from holding or acquiring any
pecuniary or personal interest which conflicts with the interest of such organization, and to account to the organization
for any profit received by him in whatever capacity in connection with transactions conducted by him or under his
direction on behalf of the organization. A general exculpatory resolution of a governing body purporting to relieve any
such person of liability for breach of the duties declared by this section shall be void as against public policy.

(b) When any officer, agent, shop steward, or representative of any labor organization is alleged to have violated the
duties declared in subsection (a) of this section and the labor organization or its governing board or officers refuse or fail
to sue or recover damages or secure an accounting or other appropriate relief within a reasonable time after being
requested to do so by any member of the labor organization, such member may sue such officer, agent, shop steward, or
representative in any district court of the United States or in any State court of competent jurisdiction to recover
damages or secure an accounting or other appropriate relief for the benefit of the labor organization.

15
SECTION 6. Shop Stewards. The UNION shall certify a total of eight (8) shop stewards and shall inform management of
the distribution of these stewards among the departments concerned. Shop Stewards, union officers and members or
employees shall not lose pay for attending Union-Management Labor dialogues, investigations and grievance meetings
with management.

Sukhothai Cuisine and Restaurant v. CA, NLRC, Philippine Labor Alliance
Council (PLAC) Local 460 Sukhothai Restaurant Chapter, and 29 workers
(6 officers of the Union, 23 members)
17 July 2006; Austria-Martinez, J.
Digest prepared by Jethro Koon
Union, on the ground of ULP by petitioner, particularly union-busting, filed a
Notice of Strike, then conducted a Strike Vote and reported the same to the
NCMB (in short they followed the procedure). However, the issue which was the
SM of the Notice and Vote were submitted to voluntary arbitration. During the
pendency of the arbitration, petitioner terminated 2 union members which lead
to the Union conducting a wildcat strike 6 months after, re-filed a notice of
strike and without conducting a vote, then reporting the results to the NCMB,
conducted an actual strike.
Strike was illegal: no strike or lockout can be made during the pendency of the
case. Even if the ground is for union-busting, only the 15-day cool-off period
may be dispensed with and not the other requirements.
I. Facts
1. March 1998: Majority of the EEs of petitioner organized themselves
into a union which affiliated with Phil. Labor Alliance Council (PLAC)
and was designated as PLAC Local 460 Sukhothai Restaurant Chapter.
(Union)
2. Dec 3, 1998: The Union filed a Notice of Strike with the NCMB on
ground of ULP particularly act of harassment, fault-finding, and union-
busting through coercion and interference with union affairs.
3. Dec 10, 1998: A conciliation conference was held and both parties
agreed that there would be no termination of services of respondents
during the pendency of the case
4. Dec 11, 1998: A Strike Vote under the supervision of NCMB personnel
was held
5. Dec 21, 1998: Results of the Strike Vote were submitted to NCMB.
6. Jan 21, 1998: Parties entered into a Submission Agreement agreeing
to submit the issue of ULP (which is the subject matter of the Notice
and Strike Vote) for voluntary arbitration (to prevent the strike)
7. Mar 24, 1999: Petitioner through its president Garcia dismissed a
union member for alleged petty quarrel with a co-EE in Feb. Union
filed a complaint for Illegal Dismissal.
8. June 24, 1999: Petitioner again relieved a union member from post
(cook). Union’s VP protested to Garcia the termination. Shortly
thereafter, Union staged a “wildcat strike”.
9. June 25, 1999: Notice of Strike was refilled. Protest turned into a
“sit-down strike”
10. June 26, 1999: Strike was converted to “actual strike”
11. Petitioner filed a complaint for Illegal Strike with NLRC
12. LA: Declared strike illegal, union officers and members validly
terminated
▪ Dec 3 and 11’s Notice and Vote referred to a dispute submitted
for arbitration, so it cannot apply to a strike 6 months
later. Union failed to comply with mandatory requisites for
strike.
13. NLRC: Reversed LA, dismissed the complaint and ordered workers to
return to work and for Sukhothai to accept them.
▪ Petitioner is guilty of union-busting and violated their Dec
10 agreement not to terminate during pendency of arbitration.
▪ Dec 3 and 11’s Notice and Vote are applicable to the June
24, 25, 26 strike since same issues of ULP are involved.
II. Issues
WON strike staged by Union was illegal – YES
WON private respondents are deemed to have lost their employment by
committing illegal acts during the strike – YES
III. Union’s arguments
1. Filing of the Notice on Dec 3 and the Strike Vote on Dec 11, the
submission to NCMB of the results and the observation of the 15 day
cooling off period in case of ULP, all satisfy the mandatory requirements
under Art 269 of the LC and are applicable to the June 1999 strike,
as per Art 269 (f) (decision to strike valid for the duration of the
dispute)
2. Even assuming that they cannot be applied to the June strike, since
petitioner was guilty of union-busting, union can take action
immediately
IV. Ratio
1. Undisputed is the fact that when Union staged the strike in June 1999,
voluntary arbitration between the parties was ongoing. The issues
to be resolved there were the same issues stated in the Notice of Strike
 of Dec 3, 1998.
2. Art 270(a) second paragraph of the LC states that no strike or lockout
shall be declared after submission of the dispute to voluntary
arbitration or during pendency of cases involving the same
grounds for the strike or lockout (see LC for whole provision)
▪ The rationale for the prohibition: once jurisdiction over labor
dispute is acquired by competent authority, jurisdiction should
not be interfered with by applying the coercive processes of a
strike.
▪ Policy of the state to promote and emphasize primacy of free
collective bargaining and negotiations, including voluntary
arbitration, mediation, and conciliation as modes of
settling labor or industrial disputes. Relations between ERs
and EEs rest on essentially voluntary basis and industrial peace
cannot be secured by compulsion of law.
3. The dismissals of the 2 union members which allegedly triggered the
wildcat strike are not sufficient grounds to justify radical recourse
on part of the Union
▪ The questions regarding their dismissal are connected to the
alleged breach of the guarantee, and other incidents of ULP
which should have been raised in the voluntary arbitration
which was commenced precisely to address said issues.
▪ Other recourse of the Union: could also have just instituted
illegal dismissal cases, or submitted it to the grievance
machinery under their CBA, or to just terminate the
voluntary arbitration case and complete the mandatory
procedure for lawful strike.
4. Union was aware of the fact of the pendency of the arbitration
proceedings, and thus it cannot invoke good faith as a defense.
5. With all these considerations: Strike was ILLEGAL.
As to the second argument of the Union re: ULP so we can dispense with the
requirements.
1. It is only the 15-day cooling off period that may be dispensed with.
2. Art 269 (f) should be read with Sec 3, Rule XXII, Book V of the IRR
which states that in case of union-busting, 15 day cooling off period
shall not apply and union may take action immediately after the strike
vote is conducted and results are submitted to NCMB.
3. NCMB Primer on Strike, Picketing and Lockout also provides the same
wording.
4. IRR clarifies Art 269(c) of the LC in that union may strike
“immediately” in case of union busting provided that strike vote is
conducted and the results submitted “in every case” at least 7 days
before the intended strike or lockout.
▪ In sum: if there is union-busting the requirements of 1) notice;
2) strike vote; 3) 7 day report period – cannot be dispensed
with.
5. Even if the strike was declared as valid because the objective was
lawful, strike may be declared invalid where the means employed are
illegal
▪ 270 provides for illegal activities during the strike.
▪ Jurisprudence have also provided for some activities that are
prohibited like shouting slanderous and scurrilous words,
unnecessary and obscene language, libelous remarks, abusive
and threatening language, formation of human cordon to block
ways, coercing others to prevent them from working,
threatening bodily harm, where EEs hijacked ER’s bus,
destruction of company property, use of Molotov bombs, etc.
(See FN 31 in SCRA for more activities)
6. For the union officers: knowingly participating in an illegal strike is
ground for dismissal; also when he commits illegal acts. For union
members: Substantial proof or evidence is that they committed illegal
acts is enough to justify imposition of penalty of dismissal.
7. In this case, evidence on record show that the respondents (both union
officers(6) and 23 members) engaged in illegal acts during the strike
▪ Intimidation and harassment of customers to discourage them
from patronizing petitioner, waving their arms and shouting
“Nilagyan naming ng lason ang pagkain dyan!”,
▪ discredited the reputation of the establishment
▪ Angry and unruly behavior calculated to cause commotion
affecting nearby establishments in the mall
▪ Openly cursing and using abusive language towards the
management.
▪ Preventing non-strikers from entering, plus deliberate blocking
their movements inside the restaurant
▪ And even shouting “Granada!” causing panic among the
customers (it was the Union President Emmanuel Cayno who
shouted
LIWAYWAY PUBLICATIONS, INC. v. PERMANENT CONCRETE WORKERS
UNION, et al ISSUE / HELD:
October 23, 1981 | J. Guerrero WON had jurisdiction over the case at bar. YES.
By: Perry Corollarily, WON this case involves or has arisen out of a labor dispute. NO.

SUMMARY:
The striking union prevented the employees of the plaintiff, Liwayway
Publications from entering the bodega that the latter was leasing. Other than the
fact that the bodega of the plaintiff and the workplace of the members of the
striking union are in the same premises, there is no other connection between
the plaintiff and the striking union. Therefore, the plaintiff sought the issuance
of a permanent injunction against the striking union to prevent the latter from
preventing the former from accessing its bodega.
The SC ruled that the plaintiff is entitled to such relief. The right to strike is
necessarily subsumed in the freedom of speech guaranteed by the Constitution.
However, the exercise of the right is not without limitations. The Courts may
intervene and regulate the right to protect “innocent bystanders” or those who
have no industrial connection or have an interest totally foreign to the dispute of
the striking union and its company.
FACTS:
The Plaintiff is leasing the premises of the Permanent Concrete Products in Sta.
Mesa. The premises of the plaintiff is separated from the premises of the Lessor-
Corporation by a concrete wall and has its own entrance and road leading to the
national road. Moreover the distance between the two entrances is more or less
200 meters.
RULING:
The SC points out that the plaintiff is not in any way related to the striking union
except for the fact that it is the lessee of a bodega in the company’s compound.
The business of the plaintiff has absolutely no connection whatsoever with the
cause of the strike of the union against their company, much less with the terms,
conditions or demands of the strikers. The plaintiff, being an “innocent
bystander”, is entitled to protection by the regular courts.
The SC notes that the right to picket is a phrase of the freedom of speech
guaranteed by the Constitution. However, the right is not an absolute one. The
courts are not without power to confine or localize the sphere of
communication or the demonstration to the parties to the labor dispute, and to
insulate establishments or persons with no industrial connection or having
interest totally foreign to the context of the dispute. Thus, the right may be
regulated at the instance of third parties or “innocent bystanders”. If the law
fails to afford said protection, men will endeavor to safeguard their rights by
their own might, take the law in their own hands, and commit acts which lead to
breaches of the law.

On 10 September 1964, the employees of the lessor-corporation staged a strike

against the corporation. However for unknown reasons, the striking employees
prevented the truck of the plaintiff from entering the compound and intimidated
and threatened its employees with bodily harm. The plaintiff made repeated
demands to the defendants to stop their actions and allow them to access their
bodega. However, their demands were left unheeded prompting them to bring
an action with the CFI for the issuance of an injunction.

The Respondent moved to dismiss the action of the plaintiff alleging that the CFI
had no jurisdiction. They alleged that it was the Court of Industrial Relations
who had exclusive jurisdiction since this is a labor dispute involving ULP.
Moreover it alleged that the plaintiff had no cause of action as it was not the real
party in interest.

The Court denied the motion to dismiss filed by the defendants and rendered a
decision in favor of the plaintiff. It declared permanent the writ of preliminary
injunction and ordered the defendants to pay damages. The defendants bring
this matter to the SC seeking the reversal of the decision of the CFI.
MSF TIRE AND RUBBER, INC. vs. CA and PHILTREAD TIRE WORKERS’
UNION
MENDOZA; August 5, 1999
SUMMARY:
During the pendency of the labor dispute between the union and
Philtread, Philtread entered into a MOA with Siam Tyre hereby its plant
and equipment would be sold to a new company, MSF Tire 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. As the union
refused to desist picketing outside the plant, MSF Tire filed a complaint
for injunction asserting its status as an innocent bystander. SC held the
petitioner is not an innocent bystander because its personality is closely
linked to Philtread.
DOCTRINE:
The right may be regulated at the instance of third parties or “innocent
bystanders” if it appears that the inevitable result of its exercise is to
create an impression that a labor dispute with which they have no
connection or interest exists between them and the picketing union or
constitute an invasion of their rights.
Thus, an “innocent bystander,” who seeks to enjoin a labor strike, must
satisfy the court that aside from the grounds specified in Rule 58 of the
Rules of 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.
FACTS:
 A labor dispute arose between Philtread Tire and Rubber
Corporation (Philtread) and private respondent, Philtread Tire
Workers’ Union (Union)
 Union filed a notice of strike in the National Conciliation and
Mediation Board charging Philtread with unfair labor practices for
allegedly engaging in union-busting for violation of the provisions of
the collective bargaining agreement.
 Thereafter, they picketed and assembled outside the gate of
Philtread’s plant.
 Philtread, on the other hand, filed a notice of lockout.
 The Secretary of Labor assumed jurisdiction over the labor dispute
and certified it for compulsory arbitration.
 During the pendency of the labor dispute, Philtread entered into
a Memorandum of Agreement with Siam Tyre Public Company
Limited (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 Makati.
 Respondent Union moved to dismiss the complaint alleging lack of
jurisdiction on the part of the trial court.
 RTC denied petitioner’s application for injunction and dismissed the
complaint.
 However, on petitioner’s motion, the trial court reconsidered its
order and granted an injunction.
 The respondent Union filed a petition for certiorari and prohibition
before the CA.
 CA ruled in favor of respondent Union, hence, petitioner filed this
petition asserting that its status as an “innocent bystander” entitled it
to a writ of injunction.
ISSUE: Whether or not petitioner has shown a clear legal right to the
issuance of a writ of injunction under the “innocent bystander” rule.
(NO)
HELD: Petition denied.
In Philippine Association of Free Labor Unions (PAFLU) v. Cloribel, this
Court, through Justice J.B.L. Reyes, stated the “innocent bystander” rule
as follows: 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 can not be curtailed even in the
absence of employer-employee relationship.
The right is, however, not an absolute one. While peaceful picketing is
entitled to protection as an exercise of free speech, we believe the
courts are not without power to confine or localize the sphere of
communication or the demonstration to the parties to the labor
dispute, including those with related interest, and to insulate
establishments or persons with no industrial connection or having
interest totally foreign to the context of the dispute.

Thus the right may be regulated at the instance of third parties or

“innocent bystanders” if it appears that the inevitable result of its
exercise is to create an impression that a labor dispute with which
they have no connection or interest exists between them and the
picketing union or constitute an invasion of their rights.

Thus, an “innocent bystander,” who seeks to enjoin a labor strike, must

satisfy the court that aside from the grounds specified in Rule 58 of the
Rules of 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, petitioner cannot be said not to have such

connection to the dispute.

As correctly observed by the appellate court: 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.

VOLUNTARY ARBITRATION CASES
Philtranco Service Enterprises. v. Philtranco Workers Union-
Association of Genuine Labor Organizations
February 26, 2014 | Del Castillo, J.
By: Kat
SUMMARY:
A case between Philtranco and the union that failed at the conciliator-mediator level was
referred to the DOLE Secretary. He ruled in favor of the union, so Philtranco filed MR and
then certiorari. Secretary said nope, should have been Rule 43, not Rule 65.
DOCTRINE:
MR from a decision or resolution of the Secretary, then seasonably file certiorari
within 60 days from denial of the MR. It cannot be said that in taking cognizance
of the case, the Secretary did so in a limited capacity. By referring the case to the
Secretary, the Conciliator-Mediator conceded that the case fell within the
coverage of Art. 263.
FACTS:
Due to business losses, Philtranco, a local land transportation company engaged
in the business of carrying passengers and freight, retrenched 21 of its
employees. The union then filed a notice of strike with the DOLE, claiming that
Philtranco engaged in ULP. They were unable to settle their differences at the
preliminary conference before Conciliator-Mediator Aglibut of the NCMB. The
case was then referred to the Office of the Secretary of the DOLE. Acting DOLE
Secretary Danilo Cruz issued a decision ordering Philtranco to reinstate the
illegally terminated 17 union officers and pay them backwages, maintain the
status quo and remit the withheld union dues to the union.
Philtranco MR'd after receiving the decision, while the union submitted a partial
appeal. The Secretary cited a DOLE Regulation providing that voluntary
arbitrators' decisions, orders, resolutions or awards shall not be the subject of
MRs. Philtranco went to the CA, which held that Philtranco erred in filing a Rule
65 because it should have filed a petition for review under Rule 43, which covers
decisions of voluntary labor arbitrators. Assuming Rule 65 was the proper
remedy, the petition was filed out of time because the MR did not toll the
running of the reglementary 60-day period within which to avail of certiorari.
ISSUES/HELD:
What is the proper remedy to assail the DOLE Acting Secretary's decision? (CERTIORARI
AFTER YOUR MR)
RATIO:
It cannot be said that in taking cognizance of the case, the Secretary did so in a
limited capacity (as a voluntary arbitrator). By referring the case to the
Secretary, the Conciliator-Mediator conceded that the case fell within the
coverage of Art. 263. The impending strike in a public transportation company
whose business is imbued with public interest required that the Secretary of
Labor assume jurisdiction over the case. By assuming jurisdiction, Art. 263
becomes applicable, any representation to the contrary or that he is deciding the
case in his capacity as a voluntary arbitrator notwithstanding.
It has long been settled that the remedy of an aggrieved party in a decision or
resolution of the Secretary of Labor is to timely file MR as a precondition for any
further or subsequent remedy, and then seasonably file a special civil action for
certiorari under Rule 65. There is no distinction: when the Secretary of Labor
assumes jurisdiction over a labor case in an industry indispensable to national
interest, "he exercises great breadth of discretion" in finding a solution to the
parties’ dispute. Such authority to assume jurisdiction includes and extends to
all questions and controversies arising therefrom. The power is plenary and
discretionary in nature to enable him to effectively and efficiently dispose of the
primary dispute.
National Federation of Labor v. Laguesma: Though appeals from the NLRC to the
Secretary of Labor were eliminated, there are several instances in the Labor
Code and its IRR where an appeal can be filed with the Secretary or the
Secretary issues a ruling, including Art. 263. Though the decisions of the
Secretary become final and executory 10 days after receipt, they can still be
certiorari'd even beyond that period as long as it is within the reglementary
period under Rule 65. It is procedurally feasible as well as practicable that Rule
65 petitions be filed initially with the CA (St. Martin Funeral Homes v. NLRC). The
60 days should be counted from the notice of the denial of the motion. The very
nature of certiorari – which is an extraordinary remedy resorted to only in the
absence of plain, available, speedy and adequate remedies in the course of law –
requires that the office issuing the decision or order be given the opportunity to
correct itself.
Before certiorari under Rule 65, filing MR is a condition sine qua non to afford
an opportunity for the correction of the error or mistake. Considering that a
decision of the Secretary of Labor is subject to judicial review only through a
special civil action of certiorari and cannot be resorted to without the aggrieved
party having exhausted administrative remedies through MR, the aggrieved
party, must be allowed to move for a reconsideration of the same.
While a government office may prohibit altogether the filing of MR with respect to its
decisions or orders, the fact remains that certiorari inherently requires the filing of a
motion for reconsideration, which is the tangible representation of the opportunity given
to the office to correct itself. Unless it is filed, there could be no occasion to rectify. Worse,
the remedy of certiorari would be unavailing. Having filed the MR on June 25 after
receiving the Acting Secretary's decision on June 14, it was timely filed but denied. The
decision denyingt he MR was received on August 17 and the certiorari was filed on
August 29, well within the 60-day period.
TENG v PAHAGAC
ALBERT TENG, doing business under the firm name ALBERT TENG FISH
TRADING, and EMILIA TENG-CHUA, Petitioners,
vs.
ALFREDO S. PAHAGAC, EDDIE D. NIPA, ORLANDO P. LAYESE, HERNAN Y.
BADILLES and ROGER S. PAHAGAC, Respondents.
BRION, J.:
November 17, 2010
Summary: Teng had a fishing business. His master fishermen hired respondent
workers. The workers were dismissed on the suspicion that they weren’t
reporting the correct number of fish caught. An illegal dismissal case was filed.
VA ruled for Teng and denied the subsequent MR as it wasn’t allowed for under
the rules. CA reversed and SC affirmed. An MR is not prohibited and Teng was
the employer who exercised control.
ISSUE #1: WON MR allowed (YES)
Doctrine: Art. 262-A makes the voluntary arbitration award final and executory
RATIO #1:
after ten calendar days from receipt of the copy of the award or decision by the
parties. Presumably, the decision may still be reconsidered by the Voluntary
Arbitrator on the basis of a motion for reconsideration duly filed during that
period.
FACTS
 Albert Teng Fish Trading is engaged in deep sea fishing and, for this
purpose, owns boats (basnig), equipment, and other fishing
paraphernalia. As owner of the business, Teng claims that he
customarily enters into joint venture agreements with master
fishermen (maestros) who are skilled and are experts in deep sea
fishing; they take charge of the management of each fishing venture,
including the hiring of the members of its complement. The maestros
hired the respondent workers as checkers to determine the volume
of the fish caught in every fishing voyage.
 2003, the workers filed a complaint for illegal dismissal against Albert
Teng Fish Trading, Teng, and Chua (Manager) before the NCMB
o Teng hired them, without any written employment
contract, to serve as his "eyes and ears" aboard the fishing
boats; to classify the fish caught by banñ era; to report to Teng
via radio communication the classes and volume of each catch;
to receive instructions from him as to where and when to
unload the catch; to prepare the list of the provisions requested
by the maestro and the mechanic for his approval; and, to
procure the items as approved by him.5
o They received regular monthly salaries, 13th month pay,
Christmas bonus, and incentives in the form of shares in the
total volume of fish caught.
o September 2002, Teng expressed his doubts on the correct
volume of fish caught in every fishing voyage.
o December 2002, Teng informed them that their services had
been terminated.
 Teng: the maestros, rather than he, invited them to join the venture. His
role was clearly limited to the provision of the necessary capital, tools
and equipment, consisting of basnig, gears, fuel, food, and other
supplies.
 The VA: no employer-employee relationship existed between Teng and
the respondent workers
 Workers filed an MR, which was denied. The VA reasoned out that
Section 6, Rule VII of the 1989 Procedural Guidelines in the Conduct of
Voluntary Arbitration Proceedings (1989 Procedural Guidelines) does
not provide the remedy of a motion for reconsideration to the party
adversely affected by the VA’s order or decision.
 CA reversed the VA’s decision after finding sufficient evidence showing
the existence of employer-employee relationship.
 Article 262-A of the Labor Code does not prohibit the filing of a motion
for reconsideration.
 On March 21, 1989, Republic Act No. 671523 took effect, amending,
among others, Article 263 of the Labor Code which was originally
worded as:
o Art. 263 x x x Voluntary arbitration awards or decisions shall
be final, unappealable, and executory.
o As amended, Article 263 is now Article 262-A, which states:
o Art. 262-A. x x x [T]he award or decision x x x shall contain the
facts and the law on which it is based. It shall be final and
executory after ten (10) calendar days from receipt of the copy
of the award or decision by the parties.
 Notably, Article 262-A deleted the word "unappealable" from
Article 263. The deliberate selection of the language in the amendatory
act differing from that of the original act indicates that the legislature
intended a change in the law, and the court should endeavor to give
effect to such intent.
 Imperial Textile Mills, Inc. v. Sampang: It is true that the present rule
[Art. 262-A] makes the voluntary arbitration award final and
executory after ten calendar days from receipt of the copy of the
award or decision by the parties. Presumably, the decision may still be
reconsidered by the Voluntary Arbitrator on the basis of a motion
for reconsideration duly filed during that period.
 In Coca-Cola Bottlers Phil., Inc., Sales Force Union-PTGWO-Balais v.
Coca-Cola Bottlers Philippines, Inc.: the VA’s decision may still be
reconsidered on the basis of a motion for reconsideration seasonably
filed within 10 days from receipt thereof. The seasonable filing of a
motion for reconsideration is a mandatory requirement to forestall the
 finality of such decision. [U]nder Section 6, Rule VII of the same
guidelines implementing Article 262-A of the Labor Code, this Decision,
as a matter of course, would become final and executory after ten (10)
calendar days from receipt of copies of the decision by the parties x x x
unless, in the meantime, a motion for reconsideration or a petition for
review to the Court of Appeals under Rule 43 of the Rules of Court is
filed within the same 10-day period.
 These rulings fully establish that the absence of a categorical
language in Article 262-A does not preclude the filing of a motion
for reconsideration of the VA’s decision within the 10-day period.
 Teng’s allegation that the VA’s decision had become final and executory
by the time the respondent workers filed an appeal with the CA thus
fails
 The Court notes that despite our interpretation that Article 262-A does
not preclude the filing of a motion for reconsideration of the VA’s
decision, a contrary provision can be found in Section 7, Rule XIX of the
Department of Labor’s Department Order (DO) No. 40, series of 2003:
o Section 7. Motions for Reconsideration. – The decision of the
Voluntary Arbitrator is not subject of a Motion for
Reconsideration.
 In the exercise of its power to promulgate implementing rules and
regulations, an implementing agency, such as the Department of
Labor, is restricted from going beyond the terms of the law it seeks to
implement; it should neither modify nor improve the law. The agency
formulating the rules and guidelines cannot exceed the statutory
authority granted to it by the legislature.
 By allowing a 10-day period, the obvious intent of Congress in
amending Article 263 to Article 262-A is to provide an opportunity for
the party adversely affected by the VA’s decision to seek recourse via a
motion for reconsideration or a petition for review under Rule 43 of the
Rules of Court filed with the CA. Indeed, a motion for reconsideration is
the more appropriate remedy in line with the doctrine of exhaustion of
administrative remedies. For this reason, an appeal from administrative
agencies to the CA via Rule 43 of the Rules of Court requires exhaustion
of available remedies as a condition precedent to a petition under that
Rule.
 The requirement that administrative remedies be exhausted is based on
the doctrine that in providing for a remedy before an administrative
agency, every opportunity must be given to the agency to resolve the
matter and to exhaust all opportunities for a resolution under the given
remedy before bringing an action in, or resorting to, the courts of
justice. Where Congress has not clearly required exhaustion, sound
judicial discretion governs, guided by congressional intent.
ISSUE #2: WON there exists an employer-employee relationship between Teng
and the respondent workers (NO)
RATIO #2:
 We agree with the CA’s finding that sufficient evidence exists indicating
the existence of an employer-employee relationship between Teng and
the respondent workers.
 While Teng alleged that it was the maestros who hired the respondent
workers, it was his company that issued to the respondent workers
identification cards (IDs) bearing their names as employees and Teng’s
signature as the employer. Generally, in a business establishment, IDs
are issued to identify the holder as a bona fide employee of the issuing
entity.
 For the 13 years that the respondent workers worked for Teng, they
received wages on a regular basis, in addition to their shares in the fish
caught.44 The worksheet showed that the respondent workers received
uniform amounts within a given year, which amounts annually
increased until the termination of their employment in 2002.
 Teng’s claim that the amounts received by the respondent workers are
mere commissions is incredulous
 More importantly, the element of control – which we have ruled in a
number of cases to be a strong indicator of the existence of an
employer-employee relationship – is present in this case. Teng not only
owned the tools and equipment, he directed how the respondent
workers were to perform their job as checkers; they, in fact, acted as
Teng’s eyes and ears in every fishing expedition.
 To consider the respondent workers as employees of the maestros
would mean that Teng committed impermissible labor-only contracting.
As a policy, the Labor Code prohibits labor-only contracting
 There is "labor-only" contracting where the person supplying
workers to an employer does not have substantial capital or
investment in the form of tools, equipment, machineries, work
premises, among others, and the workers recruited and placed by
such persons are performing activities which are directly related
to the principal business of such employer. In such cases, the person
or intermediary shall be considered merely as an agent of the employer
who shall be responsible to the workers in the same manner and extent
as if the latter were directly employed by him.
 In the present case, the maestros did not have any substantial capital or
investment.1avvphi1 Teng admitted that he solely provided the capital
and equipment, while the maestros supplied the workers. The power of
control over the respondent workers was lodged not with the maestros
but with Teng. As checkers, the respondent workers’ main tasks were to
count and classify the fish caught and report them to Teng.
 They performed tasks that were necessary and desirable in Teng’s
fishing business. Taken together, these incidents confirm the existence
of a labor-only contracting which is prohibited in our jurisdiction, as it
 is considered to be the employer’s attempt to evade obligations
afforded by law to employees.
 Accordingly, we hold that employer-employee ties exist between Teng
and the respondent workers.
ILLEGAL DISMISSAL
 The dismissal of an employee, which the employer must validate, has a
twofold requirement: one is substantive, the other is procedural. Not
only must the dismissal be for a just or an authorized cause, as provided
by law; the rudimentary requirements of due process – the opportunity
to be heard and to defend oneself – must be observed as well.
 Unsubstantiated suspicion is not a just cause to terminate one’s
employment under Article 282 of the Labor Code. For his failure to
comply with the Labor Code’s substantive requirement on termination
of employment, we declare that Teng illegally dismissed the respondent
workers.
DISPOSITION: WHEREFORE, we DENY the petition
Philec v. CA
December 10, 2014; Leonen
Kat U.
SUMMARY: EEs were promoted after the expiration of previous CBAs and
during the negotiation for a new CBA. The memorandums served upon the EEs
provided for a different schedule of training allowance from the one contained
in the new CBA which was made to apply retroactively before the promotion of
the EEs. The union claims that the provisions of the new CBA should govern the
schedule of training allowance of the promoted EEs. VA, CA and SC ruled in favor
of the union.
DOCTRINE:
An appeal to reverse or modify a Voluntary Arbitrator's award or decision must
be filed before the Court of Appeals within 10 calendar days from receipt of the
award or decision.
FACTS:
 Philippine Electric Corporation (PHILEC) is a domestic corporation
engaged in the manufacture and repairs of high voltage transformers.
Among its rank-and-file EEs were Eleodoro V. Lipio and Emerlito C.
Ignacio, Sr., former members of the PHILEC Workers’ Union (PWU).
 PWU is a legitimate labor organization and the exclusive bargaining
representative of PHILEC’s R&F EEs.
 From June 1, 1989 to May 31, 1997, PHILEC and its R&F EEs were
governed by CBAs providing for step increases in an EE’s basic salary
in case of promotion
 August 18 and 27, 1997: With the previous CBAs already expired,
PHILEC promoted
o Lipio: from Machinist under Pay Grade VIII to Foreman I under
Pay Grade B
o Ignacio: from DT-Assembler under Par Grade VII to Foreman I
 They were each served a memorandum, instructing them to undergo
training with allowance as provided in the memorandum.
 September 17, 1997: PHILEC and PWU entered into a new CBA,
effective retroactively on June 1, 1997 and expiring on May 31, 1999.
o Article X, Section 4 of the new CBA provided for step increases
in the basic salary of a rank-and-file employee promoted. (See
original case for the numbers)
o To be promoted, a rank-and-file employee shall undergo
training or observation and shall receive training allowance as
provided in Article IX, Section 1(f) of the new CBA
 Claiming that the schedule of training allowance stated in the
memoranda served on Lipio and Ignacio,Sr. did not conform to Article
X, Section 4 of the new CBA, PWU submitted the grievance to the
grievance machinery.
 PWU and PHILEC failed to amicably settle their grievance.
 December 21, 1998: The parties filed a submission agreement with the
NCMB, designating Hon. Ramon T. Jimenez as Voluntary Arbitrator (VA).
 PWU: For PHILEC’s failure to apply the schedule of step increases under
Article X of the June 1, 1997 CBA, PHILEC committed an ULP under
Article 248 of the LC.
 PHILEC: It promoted Lipio and Ignacio, Sr. while it was still negotiating
a new CBA with PWU. Hence, PHILEC applied the "Modified SGV" pay
grade scale in computing Lipio’s and Ignacio, Sr.’s training allowance.
This "Modified SGV" pay grade scale, which PHILEC and PWU allegedly
agreed to implement beginning on May 9, 1997, covered both rank-and-
file and supervisory EEs Its past CBAs resulted in an overlap of union
membership in Pay Grade IX of the rank-and-file EEs and Pay Grade A of
the supervisory EEs. Worse, past CBAs resulted in rank-and-file EEs
under Pay Grades IX and X enjoying higher step increases than
supervisory EEs under Pay Grades A and B. To preserve the hierarchical
wage structure within PHILEC’s enterprise, PHILEC and PWU allegedly
agreed to implement the uniform pay grade scale under the "Modified
SGV" pay grade system.
o Pay grade bracket I–IX covered R&F EEs, while pay grade
bracket A–F covered supervisory EEs.
o Under the "Modified SGV" pay grade scale, the position of
Foreman I fell under Pay Grade B.
o PHILEC then computed Lipio’s and Ignacio, Sr.’s training
allowance accordingly.
o It did not violate its CBA with PWU when it implemented the
"Modified SGV" scale.
o Even assuming that it violated the CBA, its violation was not
"gross" or a "flagrant and/or malicious refusal to comply with
the economic provisions of [the CBA]."
o PHILEC, therefore, was not guilty of ULP
o Considering that Lipio and Ignacio, Sr. were promoted to a
supervisory position, their training allowance should be
computed based on the provisions of PHILEC’s CBA with
ASSET, the exclusive bargaining representative of PHILEC’s
supervisory employees.
 VA (August 13, 1999): PHILEC violated its CBA with PWU. The new CBA
governed when PHILEC selected Lipio and Ignacio, Sr. for
promotion. The provisions of the CBA being the law between the
parties, PHILEC should have computed Lipio’s and Ignacio, Sr.’s training
allowance based on Article X, Section 4 of the new CBA.
o The alleged salary distortion resulting from the application of
the Art. X, Sec. 4 was "a concern that PHILEC could have
anticipated and could have taken corrective action" before
signing the collective bargaining agreement.
PHILEC’s acts "cannot be considered a gross violation of the
o
CBAA nor a flagrant and/or malicious refusal to comply with
the economic provisions of the agreement."
 CA: affirmed VA
ISSUE: W/N VAr Jimenez gravely abused his discretion in directing PHILEC to
pay Lipio’s and Ignacio, Sr.’s training allowance based on Article X, Section 4 of
the new CBA? NO
RATIO:
The Voluntary Arbitrator’s decision dated August 13, 1999 is already final and
executory
 The petition for certiorari under Rule 65 of the Rules of Court filed by
PHILEC was not the proper remedy.
 The proper remedy to reverse or modify a Voluntary Arbitrator’s
or a panel of Voluntary Arbitrators’ decision or award is to appeal
the award or decision before the Court of Appeals16
 A Voluntary Arbitrator or a panel of Voluntary Arbitrators has the
exclusive original jurisdiction over grievances arising from the
interpretation or implementation of collective bargaining agreements.
(See LC Art. 261)
 Should the parties agree, a Voluntary Arbitrator or a panel of Voluntary
Arbitrators shall also resolve the parties’ other labor disputes, including
unfair labor practices and bargaining deadlocks. (See LC Art. 262)
 Luzon Development Bank v. Association of Luzon Development Bank
Employees: The proper remedy against the award or decision of the
Voluntary Arbitrator is an appeal before the Court of Appeals.
 Volkschel Labor Union, et al. v. NLRC, et al.: The judgments of courts and
awards of quasi-judicial agencies must become final at some definite
time. The awards of voluntary arbitrators determine the rights of
parties; hence, their decisions have the same legal effect as judgments
of a court.
 Oceanic Bic Division (FFW), et al. v. Romero, et al.: "a voluntary
arbitrator by the nature of her functions acts in a quasi-judicial
capacity."
 The voluntary arbitrator, whether acting solely or in a panel,
enjoys in law the status of a quasi-judicial agency but independent
of, and apart from, the NLRC since his decisions are not appealable
to the latter.
16
Rules of Court, Rule 43
Sec. 1. This Rule shall apply to appeals … from awards, judgments, final orders or resolutions of or authorized
by any quasi-judicial agency in the exercise of its quasi-judicial functions. Among these agencies are the …
voluntary arbitrators authorized by law. . . . .
Sec. 3. Where to appeal. An appeal under this Rule may be taken to the Court of Appeals within the period
and in the manner herein provided, whether the appeal involves questions of fact, of law, or mixed questions
of fact and law.
  The office of a Voluntary Arbitrator or a panel of Voluntary Arbitrators,
even assuming that the office is not strictly a quasi-judicial agency, may
be considered an instrumentality:
o Assuming arguendo that the voluntary arbitrator or the panel
of voluntary arbitrators may not strictly be considered as a
quasi-judicial agency, board or commission, still both he and
the panel are comprehended within the concept of a "quasi-
judicial instrumentality." It may even be stated that it was to
meet the very situation presented by the quasi-judicial
functions of the voluntary arbitrators here, as well as the
subsequent arbitrator/arbitral tribunal operating under the
Construction Industry Arbitration Commission, that the
broader term "instrumentalities" was purposely included in
the above-quoted provision.
o An "instrumentality" is anything used as a means or agency.
Thus, the terms governmental "agency" or "instrumentality"
are synonymous in the sense that either of them is a means by
which a government acts, or by which a certain government act
or function is performed. The word "instrumentality," with
respect to a state, contemplates an authority to which the state
delegates governmental power for the performance of a state
function.
o The voluntary arbitrator no less performs a state function
pursuant to a governmental power delegated to him under the
provisions therefor in the Labor Code and he falls, therefore,
within the contemplation of the term "instrumentality" in Sec.
9 of B.P. 129.
 Since the office of a Voluntary Arbitrator or a panel of Voluntary
Arbitrators is considered a quasi-judicial agency, a decision or
award rendered by a Voluntary Arbitrator is appealable before the
Court of Appeals.
 Under Section 9 of the Judiciary Reorganization Act of 1980, the Court
of Appeals has the exclusive original jurisdiction over decisions or
awards of quasi-judicial agencies and instrumentalities
 Luzon Development Bank decided in 1995 remains "good law."
 In the 2002 case of Alcantara, Jr. v. CA, this court rejected Santiago
Alcantara, Jr.’s argument that the Rules of Court, specifically Rule 43,
Section 217, superseded the Luzon Development Bank
o Section 2, Rule 42 of the 1997 Rules of Civil Procedure, as
presently worded, is nothing more but a reiteration of the
exception to the exclusive appellate jurisdiction of the Court of
17
SEC. 2. Cases not covered. -This Rule shall not apply to judgments or final orders issued under the Labor
Code of the Philippines.
Appeals, as provided for in Section 9, Batas Pambansa Blg.
129, as amended by Republic Act No. 7902 18
 The Court took into account this exception in Luzon Development Bank
but, nevertheless, held that the decisions of voluntary arbitrators issued
pursuant to the Labor Code do not come within its ambit.
o The fact that [the voluntary arbitrator’s] functions and powers
are provided for in the Labor Code does not place him within
the exceptions to said Sec. 9 since he is a quasi-judicial
instrumentality.
o Although the Employees’ Compensation Commission is also
provided for in the Labor Code, Circular No. 1-91, which is the
forerunner of the present Revised Administrative Circular No.
1-95, laid down the procedure for the appealability of its
decisions to the CA under the foregoing rationalization, and
this was later adopted by RA No. 7902 in amending Sec. 9 of
B.P. 129.
o A fortiori, the decision or award of the voluntary arbitrator or
panel of arbitrators should likewise be appealable to the Court
of Appeals, in line with the procedure outlined in Revised
Administrative Circular No. 1-95, just like those of the quasi-
judicial agencies, boards and commissions enumerated
therein.
 Article 262-A of the Labor Code provides that the award or decision of
the Voluntary Arbitrator "shall be final and executory after ten (10)
calendar days from receipt of the copy of the award or decision by the
parties":
 Rule 43, Section 4 of the Rules of Court provides for a 15-day
reglementary period for filing an appeal. The 15-day reglementary
period has been upheld by this court in a long line of cases.
 Despite Rule 43 providing for a 15-day period to appeal, we rule that
the Voluntary Arbitrator’s decision must be appealed before the
Court of Appeals within 10 calendar days from receipt of the
decision as provided in the Labor Code.
 Appeal is a "statutory privilege," which may be exercised "only in the
manner and in accordance with the provisions of the law."
 "Perfection of an appeal within the reglementary period is not only
mandatory but also jurisdictional so that failure to do so rendered the
decision final and executory, and deprives the appellate court of
jurisdiction to alter the final judgment much less to entertain the
appeal."
 We ruled that Article 262-A of the Labor Code allows the appeal of
decisions rendered by Voluntary Arbitrators. Statute provides that the
18
(3) Exclusive appellate jurisdiction over all final judgments, decisions, resolutions, orders or awards of …
quasi-judicial agencies, instrumentalities, boards or commissions…, except those falling within the … Labor
Code of the Philippines under Presidential Decree No. 442, as amended,…
 Voluntary Arbitrator’s decision "shall be final and executory after ten
(10) calendar days from receipt of the copy of the award or decision by
the parties." Being provided in the statute, this 10-day period must be
complied with; otherwise, no appellate court will have jurisdiction over
the appeal. This absurd situation occurs when the decision is appealed
on the 11th to 15th day from receipt as allowed under the Rules, but
which decision, under the law, has already become final and executory.
 Under Article VIII, Section 5(5) of the Constitution, this court "shall not
diminish, increase, or modify substantive rights" in promulgating rules
of procedure in courts.
 The 10-day period to appeal under the Labor Code being a substantive
right, this period cannot be diminished, increased, or modified through
the Rules of Court.
 Shioji v. Harvey: The "rules of court, promulgated by authority of law,
have the force and effect of law, if not in conflict with positive
law." Rules of Court are "subordinate to the statute." In case of conflict
between the law and the Rules of Court, "the statute will prevail."
 The rule, therefore, is that a Voluntary Arbitrator’s award or
decision shall be appealed before the Court of Appeals within 10
days from receipt of the award or decision. Should the aggrieved
party choose to file a motion for reconsideration with the
Voluntary Arbitrator, the motion must be filed within the same 10-
day period since a motion for reconsideration is filed "within the
period for taking an appeal."
 A petition for certiorari is a special civil action "adopted to correct
errors of jurisdiction committed by the lower court or quasi-judicial
agency, or when there is grave abuse of discretion on the part of such
court or agency amounting to lack or excess of jurisdiction."
 An extraordinary remedy, a petition for certiorari may be filed only if
appeal is not available.
 If appeal is available, an appeal must be taken even if the ground relied
upon is grave abuse of discretion.
 As an exception to the rule, this court has allowed petitions for
certiorari to be filed in lieu of an appeal
o (a) when the public welfare and the advancement of public
policy dictate;
o (b) when the broader interests of justice so require;
o (c) when the writs issued are null; and
o (d) when the questioned order amounts to an oppressive
exercise of judicial authority.
o Other exceptions:
 None of the circumstances similar to Unicraft, Leyte IV Electric
Cooperative, and Mora (Cases where exceptions were applied) are
present in this case.
 PHILEC received Voluntary Arbitrator Jimenez’s resolution denying its
motion for partial reconsideration on August 11, 2000. PHILEC filed its
petition for certiorari before the Court of Appeals on August 29,
2000, which was 18 days after its receipt of Voluntary Arbitrator
Jimenez’s resolution. The petition for certiorari was filed beyond the
10-day reglementary period for filing an appeal. We cannot consider
PHILEC’s petition for certiorari as an appeal.
 There being no appeal seasonably filed in this case, Voluntary
Arbitrator Jimenez’s decision became final and executory after 10
calendar days from PHILEC’s receipt of the resolution denying its
motion for partial reconsideration. Voluntary Arbitrator Jimenez’s
decision is already "beyond the purview of this Court to act upon."
PHILEC must pay training allowance based on the step increases provided in the
June 1, 1997 collective bargaining agreement
 Being the law between the parties, the new CBA must govern PHILEC
and its rank-and-file employees within the agreed period.
 Lipio and Ignacio, Sr. were rank-and-file employees when PHILEC
selected them for training for the position of Foreman I beginning
August 25, 1997. Lipio and Ignacio, Sr. were selected for training during
the effectivity of the June 1, 1997 rank-and-file collective bargaining
agreement. Therefore, Lipio’s and Ignacio, Sr.’s training allowance must
be computed based on Article X, Section 4 and Article IX, Section 1(f) of
the new CBA.
 Contrary to PHILEC’s claim, Lipio and Ignacio, Sr. were not transferred
out of the bargaining unit when they were selected for training. They
remained rank-and-file employees while they trained for the position of
Foreman I.
o Under Article IX, Section 1(e) of the June 1, 1997 collective
bargaining agreement, a trainee who is "unable to demonstrate
his ability to perform the work . . . shall be reverted to his
previous assignment. . . ."
o According to the same provision, the trainee "shall hold that
job on a trial or observation basis and . . . subject to prior
approval of the authorized management official, be appointed
to the position in a regular capacity."
 Thus, training is a condition precedent for promotion. Selection for
training does not mean automatic transfer out of the bargaining unit of
rank-and-file employees.
 Moreover, the new CBA states that the training allowance of a rank-and-
file employee "whose application for a posted job is accepted shall be
computed in accordance with Section (f) of [Article IX]."
o Since Lipio and Ignacio, Sr. were rank-and-file employees when
they applied for training for the position of Foreman I, Lipio’s
 and Ignacio, Sr.’s training allowance must be computed based
on Article IX, Section 1(f) of the new CBA
 Samahang Manggagawa sa Top Form Manufacturing United Workers of
the Philippines (SMTFM-UWP) v. NLRC: Only provisions embodied in
the [collective bargaining agreement] should be so interpreted and
complied with. Where a proposal raised by a contracting party does not
find print in the [collective bargaining agreement], it is not part thereof
and the proponent has no claim whatsoever to its implementation.
 VA: Since the signing of the current CBA took place on September 27,
1997, PHILEC, by oversight, may have overlooked the possibility of a
wage distortion occurring among ASSET-occupied positions.
o This matter could have been negotiated and settled with PWU
before the actual signing of the CBA on September 27.
o Instead, PHILEC, again, allowed the provisions of Art. X, Sec. 4
of the CBA to remain the way it is and is now suffering the
consequences of its laches.
 PHILEC did not dispute PWU’s contention that it selected several rank-
and-file employees for training and paid them training allowance based
on the schedule provided in the CBA effective at the time of the trainees’
selection.
o PHILEC cannot choose when and to whom to apply the
provisions of its collective bargaining agreement.
o The provisions of a collective bargaining agreement must be
applied uniformly and complied with in good faith.