G.R. No.
85985 August 13, 1993 PAL filed a motion to dismiss the complaint, asserting its prerogative as an employer
PHILIPPINE AIRLINES, INC. (PAL), petitioner,
vs.
NATIONAL LABOR RELATIONS COMMISSION, LABOR ARBITER ISABEL P.
ORTIGUERRA and PHILIPPINE AIRLINES EMPLOYEES ASSOCIATION
(PALEA), respondents.
Solon Garcia for petitioner.
Adolpho M. Guerzon for respondent PALEA.
MELO, J.:
In the instant petition for certiorari, the Court is presented the issue of whether or not
the formulation of a Code of Discipline among employees is a shared responsibility
of the employer and the employees.
On March 15, 1985, the Philippine Airlines, Inc. (PAL) completely revised its 1966
Code of Discipline. The Code was circulated among the employees and was
immediately implemented, and some employees were forthwith subjected to the
disciplinary measures embodied therein.
Thus, on August 20, 1985, the Philippine Airlines Employees Association (PALEA)
filed a complaint before the National Labor Relations Commission (NLRC) for unfair
labor practice (Case No. NCR-7-2051-85) with the following remarks: "ULP with
arbitrary implementation of PAL's Code of Discipline without notice and prior
discussion with Union by Management" (Rollo, p. 41). In its position paper, PALEA
contended that PAL, by its unilateral implementation of the Code, was guilty of unfair
labor practice, specifically Paragraphs E and G of Article 249 and Article 253 of the
Labor Code. PALEA alleged that copies of the Code had been circulated in limited
numbers; that being penal in nature the Code must conform with the requirements of
sufficient publication, and that the Code was arbitrary, oppressive, and prejudicial to
the rights of the employees. It prayed that implementation of the Code be held in
abeyance; that PAL should discuss the substance of the Code with PALEA; that
employees dismissed under the Code be reinstated and their cases subjected to
further hearing; and that PAL be declared guilty of unfair labor practice and be
ordered to pay damages (pp. 7-14, Record.)
to prescibe rules and regulations regarding employess' conduct in carrying out their
duties and functions, and alleging that by implementing the Code, it had not violated
the collective bargaining agreement (CBA) or any provision of the Labor Code.
Assailing the complaint as unsupported by evidence, PAL maintained that Article
253 of the Labor Code cited by PALEA reffered to the requirements for negotiating a
CBA which was inapplicable as indeed the current CBA had been negotiated.
In its reply to PAL's position paper, PALEA maintained that Article 249 (E) of the
Labor Code was violated when PAL unilaterally implemented the Code, and cited
provisions of Articles IV and I of Chapter II of the Code as defective for, respectively,
running counter to the construction of penal laws and making punishable any
offense within PAL's contemplation. These provisions are the following:
Sec. 2. Non-exclusivity. — This Code does not contain the entirety of the rules and
regulations of the company. Every employee is bound to comply with all applicable
rules, regulations, policies, procedures and standards, including standards of quality,
productivity and behaviour, as issued and promulgated by the company through its
duly authorized officials. Any violations thereof shall be punishable with a penalty to
be determined by the gravity and/or frequency of the offense.
Sec. 7. Cumulative Record. — An employee's record of offenses shall be
cumulative. The penalty for an offense shall be determined on the basis of his past
record of offenses of any nature or the absence thereof. The more habitual an
offender has been, the greater shall be the penalty for the latest offense. Thus, an
employee may be dismissed if the number of his past offenses warrants such
penalty in the judgment of management even if each offense considered separately
may not warrant dismissal. Habitual offenders or recidivists have no place in PAL.
On the other hand, due regard shall be given to the length of time between
commission of individual offenses to determine whether the employee's conduct
may indicate occasional lapses (which may nevertheless require sterner disciplinary
action) or a pattern of incorrigibility.
Labor Arbiter Isabel P. Ortiguerra handling the case called the parties to a
conference but they failed to appear at the scheduled date. Interpreting such failure
as a waiver of the parties' right to present evidence, the labor arbiter considered the
case submitted for decision. On November 7, 1986, a decision was rendered finding
no bad faith on the part of PAL in adopting the Code and ruling that no unfair labor
practice had been committed. However, the arbiter held that PAL was "not totally
fault free" considering that while the issuance of rules and regulations governing the
conduct of employees is a "legitimate management prerogative" such rules and
regulations must meet the test of "reasonableness, propriety and fairness." She
found Section 1 of the Code aforequoted as "an all embracing and all encompassing
provision that makes punishable any offense one can think of in the company"; while
Section 7, likewise quoted above, is "objectionable for it violates the rule against
double jeopardy thereby ushering in two or more punishment for the same
misdemeanor." (pp. 38-39, Rollo.)
The labor arbiter also found that PAL "failed to prove that the new Code was amply
circulated." Noting that PAL's assertion that it had furnished all its employees copies
of the Code is unsupported by documentary evidence, she stated that such "failure"
on the part of PAL resulted in the imposition of penalties on employees who thought
all the while that the 1966 Code was still being followed. Thus, the arbiter concluded
that "(t)he phrase ignorance of the law excuses no one from compliance . . . finds
application only after it has been conclusively shown that the law was circulated to
all the parties concerned and efforts to disseminate information regarding the new
law have been exerted. (p. 39, Rollo.) She thereupon disposed:
WHEREFORE, premises considered, respondent PAL is hereby ordered as follows:
1. Furnish all employees with the new Code of Discipline;
2. Reconsider the cases of employees meted with penalties under the New Code of
Discipline and remand the same for further hearing; and
3. Discuss with PALEA the objectionable provisions specifically tackled in the body
of the decision.
All other claims of the complainant union (is) [are] hereby, dismissed for lack of
merit.
SO ORDERED. (p. 40, Rollo.)
PAL appealed to the NLRC. On August 19, 1988, the NLRC through Commissioner
Encarnacion, with Presiding Commissioner Bonto-Perez and Commissioner
Maglaya concurring, found no evidence of unfair labor practice committed by PAL
and affirmed the dismissal of PALEA's charge. Nonetheless, the NLRC made the
following observations:
Indeed, failure of management to discuss the provisions of a contemplated code of
discipline which shall govern the conduct of its employees would result in the
erosion and deterioration of an otherwise harmonious and smooth relationship
between them as did happen in the instant case. There is no dispute that adoption of
rules of conduct or discipline is a prerogative of management and is imperative and
essential if an industry, has to survive in a competitive world. But labor climate has
progressed, too. In the Philippine scene, at no time in our contemporary history is
the need for a cooperative, supportive and smooth relationship between labor and
management more keenly felt if we are to survive economically. Management can
no longer exclude labor in the deliberation and adoption of rules and regulations that
will affect them.
The complainant union in this case has the right to feel isolated in the adoption of
the New Code of Discipline. The Code of Discipline involves security of tenure and
loss of employment — a property right! It is time that management realizes that to
attain effectiveness in its conduct rules, there should be candidness and openness
by Management and participation by the union, representing its members. In fact,
our Constitution has recognized the principle of "shared responsibility" between
employers and workers and has likewise recognized the right of workers to
participate in "policy and decision-making process affecting their rights . . ." The
latter provision was interpreted by the Constitutional Commissioners to mean
participation in "management"' (Record of the Constitutional Commission, Vol. II).
In a sense, participation by the union in the adoption of the code if conduct could
have accelerated and enhanced their feelings of belonging and would have resulted
in cooperation rather than resistance to the Code. In fact, labor-management
cooperation is now "the thing." (pp. 3-4, NLRC Decision ff. p. 149, Original Record.)
Respondent Commission thereupon disposed:
WHEREFORE, premises considered, we modify the appealed decision in the sense
that the New Code of Discipline should be reviewed and discussed with complainant
union, particularly the disputed provisions [.] (T)hereafter, respondent is directed to
furnish each employee with a copy of the appealed Code of Discipline. The pending
cases adverted to in the appealed decision if still in the arbitral level, should be
reconsidered by the respondent Philippine Air Lines. Other dispositions of the Labor
Arbiter are sustained.
SO ORDERED. (p. 5, NLRC Decision.)
PAL then filed the instant petition for certiorari  charging public respondents with
grave abuse of discretion in: (a) directing PAL "to share its management prerogative
of formulating a Code of Discipline"; (b) engaging in quasi-judicial legislation in
ordering PAL to share said prerogative with the union; (c) deciding beyond the issue
of unfair labor practice, and (d) requiring PAL to reconsider pending cases still in the
arbitral level (p. 7, Petition; p. 8, Rollo.)
As stated above, the Principal issue submitted for resolution in the instant petition is
whether management may be compelled to share with the union or its employees its
prerogative of formulating a code of discipline.
PAL asserts that when it revised its Code on March 15, 1985, there was no law
which mandated the sharing of responsibility therefor between employer and
employee.
Indeed, it was only on March 2, 1989, with the approval of Republic Act No. 6715,
amending Article 211 of the Labor Code, that the law explicitly considered it a State
policy "(t)o ensure the participation of workers in decision and policy-making
processes affecting the rights, duties and welfare." However, even in the absence of
said clear provision of law, the exercise of management prerogatives was never
considered boundless. Thus, in Cruz vs. Medina  (177 SCRA 565 [1989]) it was held
that management's prerogatives must be without abuse of discretion.
In San Miguel Brewery Sales Force Union (PTGWO) vs. Ople  (170 SCRA 25
[1989]), we upheld the company's right to implement a new system of distributing its
products, but gave the following caveat:
So long as a company's management prerogatives are exercised in good faith for
the advancement of the employer's interest and not for the purpose of defeating or
circumventing the rights of the employees under special laws or under valid
agreements, this Court will uphold them.
(at p. 28.)
All this points to the conclusion that the exercise of managerial prerogatives
is not unlimited. It is circumscribed by limitations found in law, a collective bargaining
agreement, or the general principles of fair play and justice (University of Sto.
Tomas vs. NLRC, 190 SCRA 758 [1990]). Moreover, as enunciated in Abbott
Laboratories (Phil.), vs. NLRC  (154 713 [1987]), it must be duly established that the
prerogative being invoked is clearly a managerial one.
A close scrutiny of the objectionable provisions of the Code reveals that they are not
purely business-oriented nor do they concern the management aspect of the
business of the company as in the San Miguel case. The provisions of the Code
clearly have repercusions on the employee's right to security of tenure. The
implementation of the provisions may result in the deprivation of an employee's
means of livelihood which, as correctly pointed out by the NLRC, is a property right
(Callanta, vs Carnation Philippines, Inc., 145 SCRA 268 [1986]). In view of these
aspects of the case which border on infringement of constitutional rights, we must
uphold the constitutional requirements for the protection of labor and the promotion
of social justice, for these factors, according to Justice Isagani Cruz, tilt "the scales
of justice when there is doubt, in favor of the worker" (Employees Association of the
Philippine American Life Insurance Company vs. NLRC, 199 SCRA 628 [1991] 635).
Verily, a line must be drawn between management prerogatives regarding business
operations per se and those which affect the rights of the employees. In treating the
latter, management should see to it that its employees are at least properly informed
of its decisions or modes action. PAL asserts that all its employees have been
furnished copies of the Code. Public respondents found to the contrary, which
finding, to say the least is entitled to great respect.
PAL posits the view that by signing the 1989-1991 collective bargaining agreement,
on June 27, 1990, PALEA in effect, recognized PAL's "exclusive right to make and
enforce company rules and regulations to carry out the functions of
management without  having to discuss the same with PALEA and much less, obtain
the latter's conformity thereto" (pp. 11-12, Petitioner's Memorandum; pp 180-
181, Rollo.) Petitioner's view is based on the following provision of the agreement:
The Association recognizes the right of the Company to determine matters of
management it policy and Company operations and to direct its manpower.
Management of the Company includes the right to organize, plan, direct and control
operations, to hire, assign employees to work, transfer employees from one
department, to another, to promote, demote, discipline, suspend or discharge
employees for just cause; to lay-off employees for valid and legal causes, to
introduce new or improved methods or facilities or to change existing methods or
facilities and the right to make and enforce Company rules and regulations to carry
out the functions of management.
The exercise by management of its prerogative shall be done in a just reasonable,
humane and/or lawful manner.
Such provision in the collective bargaining agreement may not be interpreted as
cession of employees' rights to participate in the deliberation of matters which may
affect their rights and the formulation of policies relative thereto. And one such mater
is the formulation of a code of discipline.
Indeed, industrial peace cannot be achieved if the employees are denied their just
participation in the discussion of matters affecting their rights. Thus, even before
Article 211 of the labor Code (P.D. 442) was amended by Republic Act No. 6715, it
was already declared a policy of the State, "(d) To promote the enlightenment of
workers concerning their rights and obligations . . . as employees." This was, of
course, amplified by Republic Act No 6715 when it decreed the "participation of
workers in decision and policy making processes affecting their rights, duties and
welfare." PAL's position that it cannot be saddled with the "obligation" of sharing
management prerogatives as during the formulation of the Code, Republic Act No.
6715 had not yet been enacted (Petitioner's Memorandum, p. 44; Rollo, p. 212),
cannot thus be sustained. While such "obligation" was not yet founded in law when
the Code was formulated, the attainment of a harmonious labor-management
relationship and the then already existing state policy of enlightening workers
concerning their rights as employees demand no less than the observance of
transparency in managerial moves affecting employees' rights.

Petitioner's assertion that it needed the implementation of a new Code of Discipline

considering the nature of its business cannot be overemphasized. In fact, its being a
local monopoly in the business demands the most stringent of measures to attain
safe travel for its patrons. Nonetheless, whatever disciplinary measures are adopted
cannot be properly implemented in the absence of full cooperation of the employees.
Such cooperation cannot be attained if the employees are restive on account, of
their being left out in the determination of cardinal and fundamental matters affecting
their employment.

WHEREFORE, the petition is DISMISSED and the questioned decision AFFIRMED.

No special pronouncement is made as to costs.

SO ORDERED.

G.R. No. 172013               October 2, 2009

PATRICIA HALAGUEÑA, MA. ANGELITA L. PULIDO, MA. TERESITA P.

SANTIAGO, MARIANNE V. KATINDIG, BERNADETTE A. CABALQUINTO,
LORNA B. TUGAS, MARY CHRISTINE A. VILLARETE, CYNTHIA A.
STEHMEIER, ROSE ANNA G. VICTA, NOEMI R. CRESENCIO, and other flight
attendants of PHILIPPINE AIRLINES, Petitioners,
vs.
PHILIPPINE AIRLINES INCORPORATED, Respondent.
 DECISION
PERALTA, J.:
Before this Court is a petition for review on certiorari under Rule 45 of the Rules of
Court seeking to annul and set aside the Decision 1 and the Resolution2 of the Court
of Appeals (CA) in CA-G.R. SP. No. 86813.
Petitioners were employed as female flight attendants of respondent Philippine
Airlines (PAL) on different dates prior to November 22, 1996. They are members of
the Flight Attendants and Stewards Association of the Philippines (FASAP), a labor
organization certified as the sole and exclusive certified as the sole and exclusive
bargaining representative of the flight attendants, flight stewards and pursers of
respondent.
On July 11, 2001, respondent and FASAP entered into a Collective Bargaining
Agreement3 incorporating the terms and conditions of their agreement for the years
2000 to 2005, hereinafter referred to as PAL-FASAP CBA.
Section 144, Part A of the PAL-FASAP CBA, provides that:
A. For the Cabin Attendants hired before 22 November 1996:
xxxx
3. Compulsory Retirement
Subject to the grooming standards provisions of this Agreement, compulsory
retirement shall be fifty-five (55) for females and sixty (60) for males. x x x.
In a letter dated July 22, 2003, 4 petitioners and several female cabin crews
manifested that the aforementioned CBA provision on compulsory retirement is
discriminatory, and demanded for an equal treatment with their male counterparts.
This demand was reiterated in a letter 5 by petitioners' counsel addressed to
respondent demanding the removal of gender discrimination provisions in the
coming re-negotiations of the PAL-FASAP CBA.
On July 12, 2004, Robert D. Anduiza, President of FASAP submitted their 2004-
2005 CBA proposals6 and manifested their willingness to commence the collective
bargaining negotiations between the management and the association, at the
soonest possible time.
On July 29, 2004, petitioners filed a Special Civil Action for Declaratory Relief with
Prayer for the Issuance of Temporary Restraining Order and Writ of Preliminary
Injunction7 with the Regional Trial Court (RTC) of Makati City, Branch 147, docketed
as Civil Case No. 04-886, against respondent for the invalidity of Section 144, Part A
of the PAL-FASAP CBA. The RTC set a hearing on petitioners' application for a
TRO and, thereafter, required the parties to submit their respective memoranda.
On August 9, 2004, the RTC issued an Order 8 upholding its jurisdiction over the
present case. The RTC reasoned that:
In the instant case, the thrust of the Petition is Sec. 144 of the subject CBA which is
allegedly discriminatory as it discriminates against female flight attendants, in
violation of the Constitution, the Labor Code, and the CEDAW. The allegations in the
Petition do not make out a labor dispute arising from employer-employee
relationship as none is shown to exist. This case is not directed specifically against
respondent arising from any act of the latter, nor does it involve a claim against the
respondent. Rather, this case seeks a declaration of the nullity of the questioned
provision of the CBA, which is within the Court's competence, with the allegations in
the Petition constituting the bases for such relief sought.
The RTC issued a TRO on August 10, 2004, 9 enjoining the respondent for
implementing Section 144, Part A of the PAL-FASAP CBA.
The respondent filed an omnibus motion 10 seeking reconsideration of the order
overruling its objection to the jurisdiction of the RTC the lifting of the TRO. It further
prayed that the (1) petitioners' application for the issuance of a writ of preliminary
injunction be denied; and (2) the petition be dismissed or the proceedings in this
case be suspended.
On September 27, 2004, the RTC issued an Order 11 directing the issuance of a writ
of preliminary injunction enjoining the respondent or any of its agents and
representatives from further implementing Sec. 144, Part A of the PAL-FASAP CBA
pending the resolution of the case.
Aggrieved, respondent, on October 8, 2004, filed a Petition for Certiorari and
Prohibition with Prayer for a Temporary Restraining Order and Writ of Preliminary
Injunction12 with the Court of Appeals (CA) praying that the order of the RTC, which
denied its objection to its jurisdiction, be annuled and set aside for having been
issued without and/or with grave abuse of discretion amounting to lack of
jurisdiction.
The CA rendered a Decision, dated August 31, 2005, granting the respondent's
petition, and ruled that:
WHEREFORE, the respondent court is by us declared to have NO JURISDICTION
OVER THE CASE BELOW and, consequently, all the proceedings, orders and
processes it has so far issued therein are ANNULED and SET ASIDE. Respondent
court is ordered to DISMISS its Civil Case No. 04-886.
SO ORDERED.
Petitioner filed a motion for reconsideration, 13 which was denied by the CA in its
Resolution dated March 7, 2006.
Hence, the instant petition assigning the following error:
THE COURT OF APPEALS' CONCLUSION THAT THE SUBJECT MATTER IS A
LABOR DISPUTE OR GRIEVANCE IS CONTRARY TO LAW AND
JURISPRUDENCE.
The main issue in this case is whether the RTC has jurisdiction over the petitioners'
action challenging the legality or constitutionality of the provisions on the compulsory
retirement age contained in the CBA between respondent PAL and FASAP.
Petitioners submit that the RTC has jurisdiction in all civil actions in which the
subject of the litigation is incapable of pecuniary estimation and in all cases not
within the exclusive jurisdiction of any court, tribunal, person or body exercising
judicial or quasi-judicial functions. The RTC has the power to adjudicate all
controversies except those expressly witheld from the plenary powers of the court.
Accordingly, it has the power to decide issues of constitutionality or legality of the
provisions of Section 144, Part A of the PAL-FASAP CBA. As the issue involved is
constitutional in character, the labor arbiter or the National Labor Relations
Commission (NLRC) has no jurisdiction over the case and, thus, the petitioners pray
that judgment be rendered on the merits declaring Section 144, Part A of the PAL-
FASAP CBA null and void.
Respondent, on the other hand, alleges that the labor tribunals have jurisdiction over
the present case, as the controversy partakes of a labor dispute. The dispute
concerns the terms and conditions of petitioners' employment in PAL, specifically
their retirement age. The RTC has no jurisdiction over the subject matter of
petitioners' petition for declaratory relief because the Voluntary Arbitrator or panel of
Voluntary Arbitrators have original and exclusive jurisdiction to hear and decide all
unresolved grievances arising from the interpretation or implementation of the CBA.
Regular courts have no power to set and fix the terms and conditions of
employment. Finally, respondent alleged that petitioners' prayer before this Court to
resolve their petition for declaratory relief on the merits is procedurally improper and
baseless.
The petition is meritorious.
Jurisdiction of the court is determined on the basis of the material allegations of the
complaint and the character of the relief prayed for irrespective of whether plaintiff is
entitled to such relief.14
In the case at bar, the allegations in the petition for declaratory relief plainly show
that petitioners' cause of action is the annulment of Section 144, Part A of the PAL-
FASAP CBA. The pertinent portion of the petition recites:
CAUSE OF ACTION
24. Petitioners have the constitutional right to fundamental equality with men under
Section 14, Article II, 1987 of the Constitution and, within the specific context of this
case, with the male cabin attendants of Philippine Airlines.
26. Petitioners have the statutory right to equal work and employment opportunities
with men under Article 3, Presidential Decree No. 442, The Labor Code and, within
the specific context of this case, with the male cabin attendants of Philippine
Airlines.
27. It is unlawful, even criminal, for an employer to discriminate against women
employees with respect to terms and conditions of employment solely on account of
their sex under Article 135 of the Labor Code as amended by Republic Act No. 6725
or the Act Strengthening Prohibition on Discrimination Against Women.
28. This discrimination against Petitioners is likewise against the Convention on the
Elimination of All Forms of Discrimination Against Women (hereafter, "CEDAW"), a
multilateral convention that the Philippines ratified in 1981. The Government and its
agents, including our courts, not only must condemn all forms of discrimination
against women, but must also implement measures towards its elimination.
29. This case is a matter of public interest not only because of Philippine Airlines'
violation of the Constitution and existing laws, but also because it highlights the fact
that twenty-three years after the Philippine Senate ratified the CEDAW,
discrimination against women continues.
31. Section 114, Part A of the PAL-FASAP 2000-20005 CBA on compulsory
retirement from service is invidiously discriminatory against and manifestly
prejudicial to Petitioners because, they are compelled to retire at a lower age (fifty-
five (55) relative to their male counterparts (sixty (60).
33. There is no reasonable, much less lawful, basis for Philippine Airlines to
distinguish, differentiate or classify cabin attendants on the basis of sex and thereby
arbitrarily set a lower compulsory retirement age of 55 for Petitioners for the sole
reason that they are women.
37. For being patently unconstitutional and unlawful, Section 114, Part A of the PAL-
FASAP 2000-2005 CBA must be declared invalid and stricken down to the extent
that it discriminates against petitioner.
38. Accordingly, consistent with the constitutional and statutory guarantee of equality
between men and women, Petitioners should be adjudged and declared entitled, like
their male counterparts, to work until they are sixty (60) years old.
PRAYER
WHEREFORE, it is most respectfully prayed that the Honorable Court:
c. after trial on the merits:
(I) declare Section 114, Part A of the PAL-FASAP 2000-2005 CBA INVALID, NULL
and VOID to the extent that it discriminates against Petitioners; x x x x
From the petitioners' allegations and relief prayed for in its petition, it is clear that the
issue raised is whether Section 144, Part A of the PAL-FASAP CBA is unlawful and
unconstitutional. Here, the petitioners' primary relief in Civil Case No. 04-886 is the
annulment of Section 144, Part A of the PAL-FASAP CBA, which allegedly
discriminates against them for being female flight attendants. The subject of litigation
is incapable of pecuniary estimation, exclusively cognizable by the RTC, pursuant to
Section 19 (1) of Batas Pambansa Blg. 129, as amended. 15 Being an ordinary civil
action, the same is beyond the jurisdiction of labor tribunals.
The said issue cannot be resolved solely by applying the Labor Code. Rather, it
requires the application of the Constitution, labor statutes, law on contracts and the
Convention on the Elimination of All Forms of Discrimination Against Women, 16 and
the power to apply and interpret the constitution and CEDAW is within the
jurisdiction of trial courts, a court of general jurisdiction. In Georg Grotjahn GMBH &
Co. v. Isnani,17 this Court held that not every dispute between an employer and
employee involves matters that only labor arbiters and the NLRC can resolve in the
exercise of their adjudicatory or quasi-judicial powers. The jurisdiction of labor
arbiters and the NLRC under Article 217 of the Labor Code is limited to disputes
arising from an employer-employee relationship which can only be resolved by
reference to the Labor Code, other labor statutes, or their collective bargaining
agreement.
Not every controversy or money claim by an employee against the employer or vice-
versa is within the exclusive jurisdiction of the labor arbiter. Actions between
employees and employer where the employer-employee relationship is merely
incidental and the cause of action precedes from a different source of obligation is
within the exclusive jurisdiction of the regular court. 18 Here, the employer-employee
relationship between the parties is merely incidental and the cause of action
ultimately arose from different sources of obligation, i.e., the Constitution and
CEDAW.
Thus, where the principal relief sought is to be resolved not by reference to the
Labor Code or other labor relations statute or a collective bargaining agreement but
by the general civil law, the jurisdiction over the dispute belongs to the regular courts
of justice and not to the labor arbiter and the NLRC. In such situations, resolution of
the dispute requires expertise, not in labor management relations nor in wage
structures and other terms and conditions of employment, but rather in the
application of the general civil law. Clearly, such claims fall outside the area of
competence or expertise ordinarily ascribed to labor arbiters and the NLRC and the
rationale for granting jurisdiction over such claims to these agencies disappears. 19
If We divest the regular courts of jurisdiction over the case, then which tribunal or
forum shall determine the constitutionality or legality of the assailed CBA provision?
This Court holds that the grievance machinery and voluntary arbitrators do not have
the power to determine and settle the issues at hand. They have no jurisdiction and
competence to decide constitutional issues relative to the questioned compulsory
retirement age. Their exercise of jurisdiction is futile, as it is like vesting power to
someone who cannot wield it.
In Gonzales v. Climax Mining Ltd.,20 this Court affirmed the jurisdiction of courts over
questions on constitutionality of contracts, as the same involves the exercise of
judicial power. The Court said:
Whether the case involves void or voidable contracts is still a judicial question. It
may, in some instances, involve questions of fact especially with regard to the
determination of the circumstances of the execution of the contracts. But the
resolution of the validity or voidness of the contracts remains a legal or judicial
question as it requires the exercise of judicial function. It requires the ascertainment
of what laws are applicable to the dispute, the interpretation and application of those
laws, and the rendering of a judgment based thereon. Clearly, the dispute is not a
mining conflict. It is essentially judicial. The complaint was not merely for the
determination of rights under the mining contracts since the very validity of those
contracts is put in issue.
In Saura v. Saura, Jr.,21 this Court emphasized the primacy of the regular court's
judicial power enshrined in the Constitution that is true that the trend is towards
vesting administrative bodies like the SEC with the power to adjudicate matters
coming under their particular specialization, to insure a more knowledgeable solution
of the problems submitted to them. This would also relieve the regular courts of a
substantial number of cases that would otherwise swell their already clogged
dockets. But as expedient as this policy may be, it should not deprive the
courts of justice of their power to decide ordinary cases in accordance with
the general laws that do not require any particular expertise or training to
interpret and apply. Otherwise, the creeping take-over by the administrative
agencies of the judicial power vested in the courts would render the judiciary
virtually impotent in the discharge of the duties assigned to it by the
Constitution.
To be sure, in Rivera v. Espiritu,22 after Philippine Airlines (PAL) and PAL
Employees Association (PALEA) entered into an agreement, which includes the
provision to suspend the PAL-PALEA CBA for 10 years, several employees
questioned its validity via a petition for certiorari directly to the Supreme Court. They
said that the suspension was unconstitutional and contrary to public policy.
Petitioners submit that the suspension was inordinately long, way beyond the
maximum statutory life of 5 years for a CBA provided for in Article 253-A of the
Labor Code. By agreeing to a 10-year suspension, PALEA, in effect, abdicated the
workers' constitutional right to bargain for another CBA at the mandated time.
In that case, this Court denied the petition for certiorari, ruling that there is available
to petitioners a plain, speedy, and adequate remedy in the ordinary course of law.
The Court said that while the petition was denominated as one for certiorari and
prohibition, its object was actually the nullification of the PAL-PALEA agreement. As
such, petitioners' proper remedy is an ordinary civil action for annulment of contract,
an action which properly falls under the jurisdiction of the regional trial courts.
The change in the terms and conditions of employment, should Section 144 of the
CBA be held invalid, is but a necessary and unavoidable consequence of the
principal relief sought, i.e., nullification of the alleged discriminatory provision in the
CBA. Thus, it does not necessarily follow that a resolution of controversy that would
bring about a change in the terms and conditions of employment is a labor dispute,
cognizable by labor tribunals. It is unfair to preclude petitioners from invoking the
trial court's jurisdiction merely because it may eventually result into a change of the
terms and conditions of employment. Along that line, the trial court is not asked to
set and fix the terms and conditions of employment, but is called upon to determine
whether CBA is consistent with the laws.
Although the CBA provides for a procedure for the adjustment of grievances, such
referral to the grievance machinery and thereafter to voluntary arbitration would be
inappropriate to the petitioners, because the union and the management have
unanimously agreed to the terms of the CBA and their interest is unified.
In Pantranco North Express, Inc., v. NLRC,23 this Court held that:
x x x Hence, only disputes involving the union and the company shall be referred to
the grievance machinery or voluntary arbitrators.
In the instant case, both the union and the company are united or have come to an
agreement regarding the dismissal of private respondents. No grievance between
them exists which could be brought to a grievance machinery. The problem or
dispute in the present case is between the union and the company on the one hand
and some union and non-union members who were dismissed, on the other hand.
The dispute has to be settled before an impartial body. The grievance machinery
with members designated by the union and the company cannot be expected to be
impartial against the dismissed employees. Due process demands that the
dismissed workers’ grievances be ventilated before an impartial body. x x x .
Applying the same rationale to the case at bar, it cannot be said that the "dispute" is
between the union and petitioner company because both have previously agreed
upon the provision on "compulsory retirement" as embodied in the CBA. Also, it was
only private respondent on his own who questioned the compulsory retirement. x x
x.
In the same vein, the dispute in the case at bar is not between FASAP and
respondent PAL, who have both previously agreed upon the provision on the
compulsory retirement of female flight attendants as embodied in the CBA. The
dispute is between respondent PAL and several female flight attendants who
questioned the provision on compulsory retirement of female flight attendants. Thus,
applying the principle in the aforementioned case cited, referral to the grievance
machinery and voluntary arbitration would not serve the interest of the petitioners.
Besides, a referral of the case to the grievance machinery and to the voluntary
arbitrator under the CBA would be futile because respondent already implemented
Section 114, Part A of PAL-FASAP CBA when several of its female flight attendants
reached the compulsory retirement age of 55.
Further, FASAP, in a letter dated July 12, 2004, addressed to PAL, submitted its
association's bargaining proposal for the remaining period of 2004-2005 of the PAL-
FASAP CBA, which includes the renegotiation of the subject Section 144. However,
FASAP's attempt to change the questioned provision was shallow and superficial, to
say the least, because it exerted no further efforts to pursue its proposal. When
petitioners in their individual capacities questioned the legality of the compulsory
retirement in the CBA before the trial court, there was no showing that FASAP, as
their representative, endeavored to adjust, settle or negotiate with PAL for the
removal of the difference in compulsory age retirement between its female and male
flight attendants, particularly those employed before November 22, 1996. Without
FASAP's active participation on behalf of its female flight attendants, the utilization of
the grievance machinery or voluntary arbitration would be pointless.
The trial court in this case is not asked to interpret Section 144, Part A of the PAL-
FASAP CBA. Interpretation, as defined in Black's Law Dictionary, is the art of or
process of discovering and ascertaining the meaning of a statute, will, contract, or
other written document.24 The provision regarding the compulsory retirement of flight
attendants is not ambiguous and does not require interpretation. Neither is there any
question regarding the implementation of the subject CBA provision, because the
manner of implementing the same is clear in itself. The only controversy lies in its
intrinsic validity.
Although it is a rule that a contract freely entered between the parties should be
respected, since a contract is the law between the parties, said rule is not absolute.
In Pakistan International Airlines Corporation v. Ople,25 this Court held that:
The principle of party autonomy in contracts is not, however, an absolute principle.
The rule in Article 1306, of our Civil Code is that the contracting parties may
establish such stipulations as they may deem convenient, "provided they are not
contrary to law, morals, good customs, public order or public policy." Thus, counter-
balancing the principle of autonomy of contracting parties is the equally general rule
that provisions of applicable law, especially provisions relating to matters affected
with public policy, are deemed written into the contract. Put a little differently, the
governing principle is that parties may not contract away applicable provisions of law
especially peremptory provisions dealing with matters heavily impressed with public
interest. The law relating to labor and employment is clearly such an area and
parties are not at liberty to insulate themselves and their relationships from the
impact of labor laws and regulations by simply contracting with each other.
Moreover, the relations between capital and labor are not merely contractual. They
are so impressed with public interest that labor contracts must yield to the common
good.x x x 26 The supremacy of the law over contracts is explained by the fact that
labor contracts are not ordinary contracts; these are imbued with public interest and
therefore are subject to the police power of the state. 27 It should not be taken to
mean that retirement provisions agreed upon in the CBA are absolutely beyond the
ambit of judicial review and nullification. A CBA, as a labor contract, is not merely
contractual in nature but impressed with public interest. If the retirement provisions
in the CBA run contrary to law, public morals, or public policy, such provisions may
very well be voided.28
Finally, the issue in the petition for certiorari brought before the CA by the
respondent was the alleged exercise of grave abuse of discretion of the RTC in
taking cognizance of the case for declaratory relief. When the CA annuled and set
aside the RTC's order, petitioners sought relief before this Court through the instant
petition for review under Rule 45. A perusal of the petition before Us, petitioners
pray for the declaration of the alleged discriminatory provision in the CBA against its
female flight attendants.
This Court is not persuaded. The rule is settled that pure questions of fact may not
be the proper subject of an appeal by certiorari under Rule 45 of the Revised Rules
of Court. This mode of appeal is generally limited only to questions of law which
must be distinctly set forth in the petition. The Supreme Court is not a trier of facts. 29
The question as to whether said Section 114, Part A of the PAL-FASAP CBA is
discriminatory or not is a question of fact. This would require the presentation and
reception of evidence by the parties in order for the trial court to ascertain the facts
of the case and whether said provision violates the Constitution, statutes and
treaties. A full-blown trial is necessary, which jurisdiction to hear the same is
properly lodged with the the RTC. Therefore, a remand of this case to the RTC for
the proper determination of the merits of the petition for declaratory relief is just and
proper.1avvphi1

WHEREFORE, the petition is PARTLY GRANTED. The Decision and Resolution of

the Court of Appeals, dated August 31, 2005 and March 7, 2006, respectively, in
CA-G.R. SP. No. 86813 are REVERSED and SET ASIDE. The Regional Trial Court
of Makati City, Branch 147 is DIRECTED to continue the proceedings in Civil Case
No. 04-886 with deliberate dispatch.

SO ORDERED.

G.R. No. 87700 June 13, 1990

SAN MIGUEL CORPORATION EMPLOYEES UNION-PTGWO, DANIEL S.L.

BORBON II, HERMINIA REYES, MARCELA PURIFICACION, ET AL., petitioners,
vs.
HON. JESUS G. BERSAMIRA, IN HIS CAPACITY AS PRESIDING JUDGE OF
BRANCH 166, RTC, PASIG, and SAN MIGUEL CORPORATION, respondents.

Romeo C. Lagman for petitioners.

Jardeleza, Sobrevinas, Diaz, Mayudini & Bodegon for respondents.

MELENCIO-HERRERA, J.:
Respondent Judge of the Regional Trial Court of Pasig, Branch 166, is taken to task
by petitioners in this special civil action for certiorari and Prohibition for having
issued the challenged Writ of Preliminary Injunction on 29 March 1989 in Civil Case
No. 57055 of his Court entitled "San Miguel Corporation vs. SMCEU-PTGWO, et
als."
Petitioners' plea is that said Writ was issued without or in excess of jurisdiction and
with grave abuse of discretion, a labor dispute being involved. Private respondent
San Miguel Corporation (SanMig. for short), for its part, defends the Writ on the
ground of absence of any employer-employee relationship between it and the
contractual workers employed by the companies Lipercon Services, Inc. (Lipercon)
and D'Rite Service Enterprises (D'Rite), besides the fact that the Union is bereft of
personality to represent said workers for purposes of collective bargaining. The
Solicitor General agrees with the position of SanMig.
The antecedents of the controversy reveal that:
Sometime in 1983 and 1984, SanMig entered into contracts for merchandising
services with Lipercon and D'Rite (Annexes K and I, SanMig's Comment,
respectively). These companies are independent contractors duly licensed by the
Department of Labor and Employment (DOLE). SanMig entered into those contracts
to maintain its competitive position and in keeping with the imperatives of efficiency,
business expansion and diversity of its operation. In said contracts, it was expressly
understood and agreed that the workers employed by the contractors were to be
paid by the latter and that none of them were to be deemed employees or agents of
SanMig. There was to be no employer-employee relation between the contractors
and/or its workers, on the one hand, and SanMig on the other.
Petitioner San Miguel Corporation Employees Union-PTWGO (the Union, for brevity)
is the duly authorized representative of the monthly paid rank-and-file employees of
SanMig with whom the latter executed a Collective Bargaining Agreement (CBA)
effective 1 July 1986 to 30 June 1989 (Annex A, SanMig's Comment). Section 1 of
their CBA specifically provides that "temporary, probationary, or contract employees
and workers are excluded from the bargaining unit and, therefore, outside the scope
of this Agreement."
In a letter, dated 20 November 1988 (Annex C, Petition), the Union advised SanMig
that some Lipercon and D'Rite workers had signed up for union membership and
sought the regularization of their employment with SMC. The Union alleged that this
group of employees, while appearing to be contractual workers supposedly
independent contractors, have been continuously working for SanMig for a period
ranging from six (6) months to fifteen (15) years and that their work is neither casual
nor seasonal as they are performing work or activities necessary or desirable in the
usual business or trade of SanMig. Thus, it was contended that there exists a "labor-
only" contracting situation. It was then demanded that the employment status of
these workers be regularized.
On 12 January 1989 on the ground that it had failed to receive any favorable
response from SanMig, the Union filed a notice of strike for unfair labor practice,
CBA violations, and union busting (Annex D, Petition).
On 30 January 1989, the Union again filed a second notice of strike for unfair labor
practice (Annex F, Petition).
As in the first notice of strike. Conciliatory meetings were held on the second notice.
Subsequently, the two (2) notices of strike were consolidated and several
conciliation conferences were held to settle the dispute before the National
Conciliation and Mediation Board (NCMB) of DOLE (Annex G, Petition).
Beginning 14 February 1989 until 2 March 1989, series of pickets were staged by
Lipercon and D'Rite workers in various SMC plants and offices.
On 6 March 1989, SMC filed a verified Complaint for Injunction and Damages before
respondent Court to enjoin the Union from:
a. representing and/or acting for and in behalf of the employees of LIPERCON
and/or D'RITE for the purposes of collective bargaining;
b. calling for and holding a strike vote, to compel plaintiff to hire the employees or
workers of LIPERCON and D'RITE;
c. inciting, instigating and/or inducing the employees or workers of LIPERCON and
D'RITE to demonstrate and/or picket at the plants and offices of plaintiff within the
bargaining unit referred to in the CBA,...;
d. staging a strike to compel plaintiff to hire the employees or workers of LIPERCON
and D'RITE;
e. using the employees or workers of LIPERCON AND D'RITE to man the strike
area and/or picket lines and/or barricades which the defendants may set up at the
plants and offices of plaintiff within the bargaining unit referred to in the CBA ...;
f. intimidating, threatening with bodily harm and/or molesting the other employees
and/or contract workers of plaintiff, as well as those persons lawfully transacting
business with plaintiff at the work places within the bargaining unit referred to in the
CBA, ..., to compel plaintiff to hire the employees or workers of LIPERCON and
D'RITE;
g. blocking, preventing, prohibiting, obstructing and/or impeding the free ingress to,
and egress from, the work places within the bargaining unit referred to in the CBA ..,
to compel plaintiff to hire the employees or workers of LIPERCON and D'RITE;
h. preventing and/or disrupting the peaceful and normal operation of plaintiff at the
work places within the bargaining unit referred to in the CBA, Annex 'C' hereof, to
compel plaintiff to hire the employees or workers of LIPERCON and D'RITE. (Annex
H, Petition)
Respondent Court found the Complaint sufficient in form and substance and issued
a Temporary Restraining Order for the purpose of maintaining the status quo, and
set the application for Injunction for hearing.
In the meantime, on 13 March 1989, the Union filed a Motion to Dismiss SanMig's
Complaint on the ground of lack of jurisdiction over the case/nature of the action,
which motion was opposed by SanMig. That Motion was denied by respondent
Judge in an Order dated 11 April 1989.
After several hearings on SanMig's application for injunctive relief, where the parties
presented both testimonial and documentary evidence on 25 March 1989,
respondent Court issued the questioned Order (Annex A, Petition) granting the
application and enjoining the Union from Committing the acts complained of, supra.
Accordingly, on 29 March 1989, respondent Court issued the corresponding Writ of
Preliminary Injunction after SanMig had posted the required bond of P100,000.00 to
answer for whatever damages petitioners may sustain by reason thereof.
In issuing the Injunction, respondent Court rationalized:
The absence of employer-employee relationship negates the existence of labor
dispute. Verily, this court has jurisdiction to take cognizance of plaintiff's grievance.
The evidence so far presented indicates that plaintiff has contracts for services with
Lipercon and D'Rite. The application and contract for employment of the defendants'
witnesses are either with Lipercon or D'Rite. What could be discerned is that there is
no employer-employee relationship between plaintiff and the contractual workers
employed by Lipercon and D'Rite. This, however, does not mean that a final
determination regarding the question of the existence of employer-employee
relationship has already been made. To finally resolve this dispute, the court must
extensively consider and delve into the manner of selection and engagement of the
putative employee; the mode of payment of wages; the presence or absence of a
power of dismissal; and the Presence or absence of a power to control the putative
employee's conduct. This necessitates a full-blown trial. If the acts complained of are
not restrained, plaintiff would, undoubtedly, suffer irreparable damages. Upon the
other hand, a writ of injunction does not necessarily expose defendants to
irreparable damages.
Evidently, plaintiff has established its right to the relief demanded. (p. 21, Rollo)
Anchored on grave abuse of discretion, petitioners are now before us seeking
nullification of the challenged Writ. On 24 April 1989, we issued a Temporary
Restraining Order enjoining the implementation of the Injunction issued by
respondent Court. The Union construed this to mean that "we can now strike," which
it superimposed on the Order and widely circulated to entice the Union membership
to go on strike. Upon being apprised thereof, in a Resolution of 24 May 1989, we
required the parties to "RESTORE the status quo ante declaration of strike" (p. 2,62
Rollo).
In the meantime, however, or on 2 May 1989, the Union went on strike. Apparently,
some of the contractual workers of Lipercon and D'Rite had been laid off. The strike
adversely affected thirteen (13) of the latter's plants and offices.
On 3 May 1989, the National Conciliation and Mediation Board (NCMB) called the
parties to conciliation. The Union stated that it would lift the strike if the thirty (30)
Lipercon and D'Rite employees were recalled, and discussion on their other
demands, such as wage distortion and appointment of coordinators, were made.
Effected eventually was a Memorandum of Agreement between SanMig and the
Union that "without prejudice to the outcome of G.R. No. 87700 (this case) and Civil
Case No. 57055 (the case below), the laid-off individuals ... shall be recalled
effective 8 May 1989 to their former jobs or equivalent positions under the same
terms and conditions prior to "lay-off" (Annex 15, SanMig Comment). In turn, the
Union would immediately lift the pickets and return to work.
After an exchange of pleadings, this Court, on 12 October 1989, gave due course to
the Petition and required the parties to submit their memoranda simultaneously, the
last of which was filed on 9 January 1990.
The focal issue for determination is whether or not respondent Court correctly
assumed jurisdiction over the present controversy and properly issued the Writ of
Preliminary Injunction to the resolution of that question, is the matter of whether, or
not the case at bar involves, or is in connection with, or relates to a labor dispute. An
affirmative answer would bring the case within the original and exclusive jurisdiction
of labor tribunals to the exclusion of the regular Courts.
Petitioners take the position that 'it is beyond dispute that the controversy in the
court a quo involves or arose out of a labor dispute and is directly connected or
interwoven with the cases pending with the NCMB-DOLE, and is thus beyond the
ambit of the public respondent's jurisdiction. That the acts complained of (i.e., the
mass concerted action of picketing and the reliefs prayed for by the private
respondent) are within the competence of labor tribunals, is beyond question" (pp. 6-
7, Petitioners' Memo).
On the other hand, SanMig denies the existence of any employer-employee
relationship and consequently of any labor dispute between itself and the Union.
SanMig submits, in particular, that "respondent Court is vested with jurisdiction and
judicial competence to enjoin the specific type of strike staged by petitioner union
and its officers herein complained of," for the reasons that:
A. The exclusive bargaining representative of an employer unit cannot strike to
compel the employer to hire and thereby create an employment relationship with
contractual workers, especially were the contractual workers were recognized by the
union, under the governing collective bargaining agreement, as excluded from, and
therefore strangers to, the bargaining unit.
B. A strike is a coercive economic weapon granted the bargaining representative
only in the event of a deadlock in a labor dispute over 'wages, hours of work and all
other and of the employment' of the employees in the unit. The union leaders cannot
instigate a strike to compel the employer, especially on the eve of certification
elections, to hire strangers or workers outside the unit, in the hope the latter will help
re-elect them.
C. Civil courts have the jurisdiction to enjoin the above because this specie of strike
does not arise out of a labor dispute, is an abuse of right, and violates the
employer's constitutional liberty to hire or not to hire. (SanMig's Memorandum, pp.
475-476, Rollo).
We find the Petition of a meritorious character.
A "labor dispute" as defined in Article 212 (1) of the Labor Code includes "any
controversy or matter concerning terms and conditions of employment or the
association or representation of persons in negotiating, fixing, maintaining,
changing, or arranging the terms and conditions of employment, regardless of
whether the disputants stand in the proximate relation of employer and employee."
While it is SanMig's submission that no employer-employee relationship exists
between itself, on the one hand, and the contractual workers of Lipercon and D'Rite
on the other, a labor dispute can nevertheless exist "regardless of whether the
disputants stand in the proximate relationship of employer and employee" (Article
212 [1], Labor Code, supra) provided the controversy concerns, among others, the
terms and conditions of employment or a "change" or "arrangement" thereof (ibid).
Put differently, and as defined by law, the existence of a labor dispute is not
negative by the fact that the plaintiffs and defendants do not stand in the proximate
relation of employer and employee.
That a labor dispute, as defined by the law, does exist herein is evident. At bottom,
what the Union seeks is to regularize the status of the employees contracted by
Lipercon and D'Rite in effect, that they be absorbed into the working unit of SanMig.
This matter definitely dwells on the working relationship between said employees
vis-a-vis SanMig. Terms, tenure and conditions of their employment and the
arrangement of those terms are thus involved bringing the matter within the purview
of a labor dispute. Further, the Union also seeks to represent those workers, who
have signed up for Union membership, for the purpose of collective bargaining.
SanMig, for its part, resists that Union demand on the ground that there is no
employer-employee relationship between it and those workers and because the
demand violates the terms of their CBA. Obvious then is that representation and
association, for the purpose of negotiating the conditions of employment are also
involved. In fact, the injunction sought by SanMig was precisely also to prevent such
representation. Again, the matter of representation falls within the scope of a labor
dispute. Neither can it be denied that the controversy below is directly connected
with the labor dispute already taken cognizance of by the NCMB-DOLE (NCMB-
NCR- NS-01- 021-89; NCMB NCR NS-01-093-83).
Whether or not the Union demands are valid; whether or not SanMig's contracts with
Lipercon and D'Rite constitute "labor-only" contracting and, therefore, a regular
employer-employee relationship may, in fact, be said to exist; whether or not the
Union can lawfully represent the workers of Lipercon and D'Rite in their demands
against SanMig in the light of the existing CBA; whether or not the notice of strike
was valid and the strike itself legal when it was allegedly instigated to compel the
employer to hire strangers outside the working unit; — those are issues the
resolution of which call for the application of labor laws, and SanMig's cause's of
action in the Court below are inextricably linked with those issues.
The precedent in Layno vs. de la Cruz  (G.R. No. L-29636, 30 April 1965, 13 SCRA
738) relied upon by SanMig is not controlling as in that case there was no
controversy over terms, tenure or conditions, of employment or the representation of
employees that called for the application of labor laws. In that case, what the
petitioning union demanded was not a change in working terms and conditions, or
the representation of the employees, but that its members be hired as stevedores in
the place of the members of a rival union, which petitioners wanted discharged
notwithstanding the existing contract of the arrastre company with the latter union.
Hence, the ruling therein, on the basis of those facts unique to that case, that such a
demand could hardly be considered a labor dispute.
As the case is indisputably linked with a labor dispute, jurisdiction belongs to the
labor tribunals. As explicitly provided for in Article 217 of the Labor Code, prior to its
amendment by R.A. No. 6715 on 21 March 1989, since the suit below was instituted
on 6 March 1989, Labor Arbiters have original and exclusive jurisdiction to hear and
decide the following cases involving all workers including "1. unfair labor practice
cases; 2. those that workers may file involving wages, hours of work and other terms
and conditions of employment; ... and 5. cases arising from any violation of Article
265 of this Code, including questions involving the legality of striker and lockouts. ..."
Article 217 lays down the plain command of the law.
The claim of SanMig that the action below is for damages under Articles 19, 20 and
21 of the Civil Code would not suffice to keep the case within the jurisdictional
boundaries of regular Courts. That claim for damages is interwoven with a labor
dispute existing between the parties and would have to be ventilated before the
administrative machinery established for the expeditious settlement of those
disputes. To allow the action filed below to prosper would bring about "split
jurisdiction" which is obnoxious to the orderly administration of justice (Philippine
Communications, Electronics and Electricity Workers Federation vs. Hon. Nolasco,
L-24984, 29 July 1968, 24 SCRA 321).
We recognize the proprietary right of SanMig to exercise an inherent management
prerogative and its best business judgment to determine whether it should contract
out the performance of some of its work to independent contractors. However, the
rights of all workers to self-organization, collective bargaining and negotiations, and
peaceful concerted activities, including the right to strike in accordance with law
(Section 3, Article XIII, 1987 Constitution) equally call for recognition and protection.
Those contending interests must be placed in proper perspective and equilibrium.
WHEREFORE, the Writ of certiorari  is GRANTED and the Orders of respondent
Judge of 25 March 1989 and 29 March 1989 are SET ASIDE. The Writ of Prohibition
is GRANTED and respondent Judge is enjoined from taking any further action in
Civil Case No. 57055 except for the purpose of dismissing it. The status quo  ante
declaration of strike ordered by the Court on 24 May 1989 shall be observed
pending the proceedings in the National Conciliation Mediation Board-Department of
Labor and Employment, docketed as NCMB-NCR-NS-01-02189 and NCMB-NCR-
NS-01-093-83. No costs. SO ORDERED.
G.R. No. L-39084 February 23, 1988
PHILIPPINE ASSOCIATION OF FREE LABOR UNIONS (PAFLU), petitioner,
vs.
EMILIO V. SALAS, Judge of the Court of First Instance of Rizal, Seventh
Judicial District, Branch I, Pasig, Rizal and WONG KING YUEN, respondents.
GANCAYCO, J.:
This is a petition for certiorari under Rule 65 of the Rules of Court.
The record of the case discloses that the herein petitioner Philippine Association of
Free Labor Unions (PAFLU) is a labor organization registered with the Department
of Labor and Employment. Sometime in 1963, the petitioner filed a Complaint for
unfair labor practice with the then Court of Industrial Relations (CIR) against the
Northwest manufacturing Corporation and a certain Gan Hun. The suit was
docketed as Case No. 3901-ULP.
On September 25, 1972, the CIR rendered a Decision in favor of the petitioner labor
organization. Pursuant to a writ of execution issued by the CIR, the provincial sheriff
of Rizal commenced levying the personal properties of the said Gan Hun,
particularly the properties found in his residential apartment unit in San Juan, then a
town of Rizal province.
The herein private respondent Wong King Yuen however, claims that Gan Hun is his
boarder in the apartment unit mentioned earlier and that the properties inside the
apartment unit levied by the provincial sheriff belong to him and not to Gan Hun.
Thus, on October 18, 1973, the private respondent filed a Complaint for damages
with the then Court of First Instance (CFI) of Rizal against the provincial sheriff. The
suit was docketed as Civil Case No. 18460. The amount of money involved in the
said case is about P24,680.00.
As sought by the private respondent, the CFI, with the herein respondent Judge
Emilio V. Salas presiding therein, issued an injunctive writ restraining the provincial
sheriff from proceeding with the sale of the properties in question.
After having been allowed by the CFI to intervene in Civil Case No. 18460, the
petitioner labor organization sought to dismiss the Complaint on the ground that the
said court had no jurisdiction over the case filed by the private respondent. 1 The
petitioner argued that Civil Case No. 18460 relates to an existing labor dispute and
as such the proper forum for the same is the industrial court.
In an Order dated July 9, 1974, the CFI denied the Motion to Dismiss filed by the
petitioner. 2 The petitioner sought a reconsideration of the said case but did not
succeed in doing so. 3
On August 8, 1974, the petitioner elevated the case to this Court by way of the
instant Petition.4 The petitioner maintains its stand that the CFI has no jurisdiction
over Civil Case No. 18460.
In an Answer filed with this Court on August 29, 1974, the private respondent
contends that Civil Case No. 18460 is not a labor dispute recognizable by the
industrial court. The private respondent points out that Civil Case No. 18460 is an
ordinary civil action for damages against the provincial sheriff and directed against
the sheriffs bond required under Section 17, Rule 39 of the Rules of Court. The
private respondent adds that it is an entirely separate proceeding distinct from the
labor case filed with the CIR and that, accordingly, it is the Court of First Instance
which has jurisdiction over the same.5
After a careful examination of the entire record of the case, We find that instant
Petition to be devoid of merit.
The sole issue in this case is whether or not the CFI has the jurisdiction to issue the
injunctive relief questioned by the petitioner. We rule in the affirmative.
It is clear that Civil Case No. 18460 is an ordinary civil action for damages, not a
labor dispute. The case is directed against the provincial sheriff and the recovery of
damages is sought against the bond provided for Section 17, Rule 39 of the Rules of
Court governing execution and satisfaction of judgments.
Even if the act complained of by the private respondent arose from a labor dispute
between the petitioner and another party, the inevitable conclusion remains the
same — there is no labor dispute between the petitioner and the private respondent.
Civil Case No. 18460 has no direct bearing with the case flied with the industrial
court. The civil case remains distinct from the labor dispute pending with the CIR.
Under Commonwealth Act No. 103, the law creating the Court of Industrial
Relations, the jurisdiction of the industrial court is limited to labor
disputes. i.e., problems and controversies pertaining to the relationship between
employer and employee. Section I thereof provides as follows —
Sec. 1. Jurisdiction. — There is created a Court of Industrial Relations hereinafter
called the court, which shall have jurisdiction over the entire Philippines to consider,
investigate, decide and settle all questions, matters, controversies, or
disputes arising between, and/or affecting employers and employees or
laborers, and regulate the relations between them, . . . . (Emphasis supplied.)
From the foregoing, it is clear that the jurisdiction of the CIR can be invoked only
when there is a dispute arising between or affecting employers and employees, or
when an employer-employee relationship exists between the parties.
There being no labor dispute between the petitioner and the private respondent, the
Court of First Instance 6 has the jurisdiction to issue the injunctive relief sought by
the private respondent in Civil Case No. 18460. 7 The latter case can proceed
independently of the case pending in the Court of Industrial Relations. 8
Accordingly, the writ of certiorari sought by the petitioner cannot issue.
WHEREFORE, in view of the foregoing, the instant Petition for certiorari is hereby
DISMISSED for lack of merit. We make no pronouncement as to costs:
SO ORDERED.