Labor Relations, Arbues-converted

Magsino Labor Relations Digests, Arbues 2019 G.R. No. L-22008 November 3, 1924 PEOPLE v JULIO POMAR

Whether said Act has been adopted in the reasonable and lawful exercise of the police power of the state.

Facts:

Held: No. Sir William Blackstone defines the police power as "the due regulation and domestic order of the kingdom, whereby the inhabitants of a state, like members of a well-governed family, are bound to conform their general behavior to the rules of propriety, good neighborhood, and good manners, and to be decent, industrious, and inoffensive in their respective stations."

Prosecuting attorney of the City of Manila presented a complaint in the Court of First Instance, accusing the defendant of a violation of section 13 in connection with section 15 of Act No. 3071. The accused was the manager and person in charge of La Flor de la Isabela, Employee Macaria Fajardo was pregnant and granted vacation leave (VL). However, accused refused to pay to Fajardo the sum P80, to which she was entitled as her regular wages corresponding to 30 days before and 30 days after her delivery. The defendant answered and admitted at the trial all of the allegations contained in the complaint, and contended that the provisions of Act No. 3071 were unconstitutional and void.

Mr. Jeremy Bentham, distributed into eight distinct branches: (1) prevention of offenses; (2) prevention of calamities; (3) prevention of endemic diseased; (4) police of charity; (5) police of interior communications; (6) police of public amusements; (7) police for recent intelligence; (8) police for registration."

Section 13 of Act No. 3071 is as follows: Justice Cooley says: "The police power is the power vested in the legislature by the constitution to make, ordain, and establish all manner of wholesome and reasonable laws, statutes, and ordinances, either with penalties or without, not repugnant to the constitution, as they shall judge to be for the good and welfare of the commonwealth, and of the subject of the same.

Every person, firm or corporation owning or managing a factory, shop or place of labor of any description shall be obliged to grant to any woman employed by it as laborer who may be pregnant, thirty days vacation with pay before and another thirty days after confinement: Provided, That the employer shall not discharge such laborer without just cause, under the penalty of being required to pay to her wages equivalent to the total of two months counted from the day of her discharge.

It has been said that the particular statute before us is required in the interest of social justice for whose end freedom of contract may lawfully be subjected to restraint. The liberty of the individual to do as he pleases, even in innocent matters, is not absolute. That liberty must frequently yield to the common good, and the line beyond which the power of interference may not be pressed is neither definite nor unalterable, may be made to move, within limits not well defined, with changing needs and circumstances.

Section 15 of the same Act is as follows: Any person, firm or corporation violating any of the provisions of this Act shall be punished by a fine of not less than fifty pesos nor more than two hundred and fifty, or by imprisonment for not less than ten days nor more than six months, or both, in the discretion of the court. In the case of firms or corporations, the presidents, directors or managers thereof or, in their default, the persons acting in their stead, shall be criminally responsible for each violation of the provisions of this Act.

The right of a person to sell his labor upon such terms as he deems proper is, in its essence, the same as the right of the purchaser of labor to prescribe the conditions upon which he will accept such labor from the person offering to sell. In all such particulars the employer and the employee have equality of right, and any legislation that disturbs that equality is an arbitrary interference with the liberty of contract, which no government can legally justify in a free land, under a constitution which provides that no person shall be deprived of his liberty without due process of law.

Said section 13 was enacted in the exercise of its police power, with the praiseworthy purpose of safeguarding the health of pregnant women laborers in "factory, shop or place of labor of any description," and of insuring to them, to a certain extent, reasonable support for one month before and one month after their delivery.

The state, when providing by legislation for the protection of the public health, the public morals, or the public safety, is subject to and is controlled by the paramount authority of the constitution of the state, and will not be permitted to

Issue:

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Magsino Labor Relations Digests, Arbues 2019 violate rights secured or guaranteed by that instrument or interfere with the execution of the powers and rights guaranteed to the people under their law — the constitution.

Does a minimum wage law for women violate the Due Process Clause of the Fifth Amendment, as applied to the states by the Fourteenth Amendment?

The police power of the state is a growing and expanding power. As civilization develops and public conscience becomes awakened, the police power may be extended, as has been demonstrated in the growth of public sentiment with reference to the manufacture and sale of intoxicating liquors. But that power cannot grow faster than the fundamental law of the state, nor transcend or violate the express inhibition of the people's law — the constitution. If the people desire to have the police power extended and applied to conditions and things prohibited by the organic law, they must first amend that law.

Held: No. The establishment of minimum wages for women was constitutional. Echoing Muller v. Oregon (1908), the majority ruled that the state may use its police power to restrict the individual freedom to contract. The decision overruled Atkins and marked the Court's departure from the expansive view of the freedom to contract. The decision is generally regarded as having ended the Lochner era, a period in American legal history in which the Supreme Court tended to invalidate legislation aimed at regulating business.

It will also be noted from an examination of said section 13, that it takes no account of contracts for the employment of women by the day nor by the piece. The law is equally applicable to each case. It will hardly be contended that the person, firm or corporation owning or managing a factory, shop or place of labor, who employs women by the day or by the piece, could be compelled under the law to pay for sixty days during which no services were rendered.

While Justice Hughes wrote the opinion, the stark doctrinal shift resulted from Justice Owen Josephus Roberts changing his perspective on this issue. According to Hughes, President Franklin Roosevelt's reelection in 1936 and the impressive achievements of the New Deal caused Roberts to abandon his affiliation with the Court's conservative justices.

It has been decided in a long line of decisions of the US SC that the right to contract about one's affairs is a part of the liberty of the individual, protected by the "due process of law" clause of the constitution. For all of the foregoing reasons, we are fully persuaded, under the facts and the law, that the provisions of section 13, of Act No. 3071 of the Philippine Legislature, are unconstitutional and void, in that they violate and are contrary to the provisions of the first paragraph of section 3 of the Act of Congress of the US.

WEST COAST HOTEL CO. v PARRISH

G.R. No. L-21484 November 29, 1969 THE AGRICULTURAL CREDIT and COOPERATIVE FINANCING ADMINISTRATION (ACCFA) v ACCFA SUPERVISORS' ASSOCIATION

300 US 379 (1937)

Facts: The Unions started protesting against alleged violations and nonimplementation of a CBA which was originally agreed upon to be effective a full year beginning July 1, 1961. On October 25, 1962 until November 26, 1962, the Unions were on a strike. On October 30, 1962 the Unions filed a complaint with the Court of Industrial Relations (CIR) against the ACCFA for having allegedly committed acts of unfair labor practice, namely: violation of the CBA in order to discourage the members of the Unions in the exercise of their right to selforganization, discrimination against said members in the matter of promotions, and refusal to bargain. On March 25, 1963, CIR ruled in favor of the Union. MR denied (G.R. No. L-21484).

Facts: Under Washington state law, the Industrial Welfare Committee and Supervisor of Women in Industry set a minimum wage of $14.50 for each work week of 48 hours. Elsie Parrish, an employee of the West Coast Hotel Company, received an amount less than this wage. Parrish brought a suit to recover the difference between the wages paid to her and the minimum wage fixed by state law. In ruling for the hotel, the lower court relied on Adkins v. Children's Hospital (1923), in which the Court struck down a minimum wage law for working women. Issue:

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Magsino Labor Relations Digests, Arbues 2019 ACCFA was renamed as Agricultural Credit Administration (ACA). On March 17, 1964 the ACCFA Supervisors' Association and the ACCFA Workers' Association filed a petition for certification election with the CIR praying that they be certified as the exclusive bargaining agents for the supervisors and rank-and-file employees, respectively, in the ACA. ACA denied that the Unions represented the majority of the employees, respectively, in the ACA. It further alleged that the petition was premature, that the ACA was not the proper party to be notified and to answer the petition, and that the employees and supervisors could not lawfully become members of the Unions, nor be represented by them. However, in a joint manifestation of the Unions dated May 7, 1964, with the conformity of the ACA Administrator and of the Agrarian Counsel in his capacity as such and as counsel for the National Land Reform Council, it was agreed "that the union petitioners in this case represent the majority of the employees in their respective bargaining units" and that only the legal issues raised would be submitted for the resolution of the trial Court. The trial Court in its order dated May 21, 1964 certified "the ACCFA Workers' Association and the ACCFA Supervisors' Association as the sole and exclusive bargaining representatives of the rank-and-file employees and supervisors, respectively, of the Agricultural Credit Administration." Said order was affirmed by the CIR en banc in its resolution dated August 24, 1964 (G.R. No. L-23605).

The implementation of the land reform program of the government according to Republic Act No. 3844 is most certainly a governmental, not a proprietary, function; and for that purpose Executive Order No. 75 has placed the ACA under the Land Reform Project Administration together with the other member agencies, the personnel complement of all of which are placed in one single pool and made available for assignment from one agency to another, subject only to Civil Service laws, rules and regulations, position classification and wage structures. The considerations set forth above militate quite strongly against the recognition of collective bargaining powers in the respondent Unions within the context of Republic Act No. 875, and hence against the grant of their basic petition for certification election as proper bargaining units. The ACA is a government office or agency engaged in governmental, not proprietary functions. Under this traditional classification, such constituent functions are exercised by the State as attributes of sovereignty, and not merely to promote the welfare, progress and prosperity of the people — these letter functions being ministrant he exercise of which is optional on the part of the government. The growing complexities of modern society, however, have rendered this traditional classification of the functions of government quite unrealistic, not to say obsolete. The areas which used to be left to private enterprise and initiative and which the government was called upon to enter optionally, and only "because it was better equipped to administer for the public welfare than is any private individual or group of individuals," continue to lose their well-defined boundaries and to be absorbed within activities that the government must undertake in its sovereign capacity if it is to meet the increasing social challenges of the times. There can be no dispute as to the fact that the land reform program contemplated in the said Code is beyond the capabilities of any private enterprise to translate into reality.

Issue: WON CIR has jurisdiction to entertain the petition of the Unions for certification election on the ground that it (ACA) is engaged in governmental functions. Held: No. Under Section 3 of the Agricultural Land Reform Code the ACA was established, among other governmental agencies, to extend credit and similar assistance to agriculture, in pursuance of the policy enunciated in Section 2.

Respondent Unions are not entitled to the certification election sought in the Court below. Such certification is admittedly for purposes of bargaining in behalf of the employees with respect to terms and conditions of employment, including the right to strike as a coercive economic weapon, as in fact the said unions did strike in 1962 against the ACCFA (G.R. No. L-21824). This is contrary to Section 11 of Republic Act No. 875

Section 110 provides that "the administrative machinery of the ACCFA shall be reorganized to enable it to align its activities with the requirements and objective of this Code and shall be known as the Agricultural Credit Administration." Under Section 112 the sum of P150M was appropriated out of national funds to finance the additional credit functions of the ACA as a result of the land reform program laid down in the Code. The power to audit the operations of farmers' cooperatives and otherwise inquire into their affairs, as given by Section 113, is in the nature of the visitorial power of the sovereign, which only a government agency specially delegated to do so by the Congress may legally exercise.

Separate opinion of Justice Fernando

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Magsino Labor Relations Digests, Arbues 2019 Governmental functions are classified into constituent and ministrant. "The former are those which constitute the very bonds of society and are compulsory in nature; the latter are those that are undertaken only by way of advancing the general interests of society, and are merely optional. President Wilson enumerates the constituent functions as follows: '(1) The keeping of order and providing for the protection of persons and property from violence and robbery. (2) The fixing of the legal relations between man and wife and between parents and children. (3) The regulation of the holding, transmission, and interchange of property, and the determination of its liabilities for debt or for crime. (4) The determination of contract rights between individuals. (5) The definition and punishment of crime. (6) The administration of justice in civil cases. (7) The determination of the political duties, privileges, and relations of citizens. (8) Dealings of the state with foreign powers: the preservation of the state from external danger or encroachment and the advancement of its international interests.'

G.R. No. 103524 April 15, 1992 CESAR BENGZON v HON. FRANKLIN N. DRILON Facts: RA 910 as amended was enacted to provide the retirement pensions of Justices of the SC and of the CA and its automatic readjustment. Similar benefits were given to members of ConCom and AFP under RA 1568 and PD 578 respectively. However, PD 644 repealed RA 1797 thus disallowing the automatic readjustment of pensions of retired justices and AFP. PD 1638 however allowed the automatic readjustment of pensions only for AFP.

The ministrant functions were then enumerated, followed by a statement of the basis that would justify engaging in such activities. Thus: "The most important of the ministrant functions are: public works, public education, public charity, health and safety regulations, and regulations of trade and industry. The principles determining whether or not a government shall exercise certain of these optional functions are: (1) that a government should do for the public welfare those things which private capital would not naturally undertake and (2) that a government should do these things which by its very nature it is better equipped to administer for the public welfare than is any private individual or group of individuals."

Thus, the Congress approved a bill for the reenactment of the repealed RA 1797 to allow automatic adjustment of pensions of justices. President Aquino, however vetoed HB. 16297 on July 11, 1990 on the for violating the policy on standardization of compensation as articulated in RA 6758 (Compensation and Position Classification Act of 1989). She further said that "the Government should not grant distinct privileges to select group of officials whose retirement benefits under existing laws already enjoy preferential treatment over those of the vast majority of our civil service servants."

It is thus apparent that until the administration of President Roosevelt, the laissez-faire principle resulted in the contraction of the sphere where governmental entry was permissible. The object was to protect property even if thereby the needs of the general public would be left unsatisfied.

Prior to the filing of the petition, the SC issued a resolution granting the administrative matter filed by another retired justice for the adjustment of their pension. Pursuant to the above resolution, Congress included in the General Appropriations Bill for Fiscal Year 1992 certain appropriations for the Judiciary intended for the payment of the adjusted pension rates due the retired Justices of SC and CA. Such was again vetoed by Cory for nullifying her ealier veto.

The laissez-faire principle never found full acceptance in the Philippines. Moreover, to erase any doubts, the ConCon saw to it that our fundamental law embodies a policy of the responsibility thrust on government to cope with social and economic problems and an earnest and sincere commitment to the promotion of the general welfare through state action. It would thus follow that the force of any legal objection to regulatory measures adversely affecting property rights or to statutes organizing public corporations that may engage in competition with private enterprise has been blunted. Unless there be a clear showing of any invasion of rights guaranteed by the Constitution, their validity is a foregone conclusion.

Issue: Held: The veto power is not absolute. The Executive must veto a bill in its entirety or not at all. However, when it comes to appropriation, revenue or tariff bills, the Constitution has wisely provided the "item veto power" to avoid inexpedient riders being attached to an indispensable appropriation or revenue measure. The power to

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Magsino Labor Relations Digests, Arbues 2019 disapprove any item or items in an appropriate bill does not grant the authority to veto a part of an item and to approve the remaining portion of the same item. It turns out, however, that P.D. 644 never became valid law. If P.D. 644 was not law, it follows that RA 1797 was not repealed and continues to be effective up to the present. In the same way that it was enforced from 1951 to 1975, so should it be enforced today. HB 16297 was superfluous as it tried to restore benefits which were never taken away validly. The veto of HB 16297 in 1991 did not also produce any effect. Both were based on erroneous and non-existent premises. From the foregoing discussion, it can be seen that when the President vetoed certain provisions of the 1992 GAA, she was actually vetoing RA 1797 which, of course, is beyond her power to accomplish.

SOCIAL JUSTICE. — Social justice is "neither communism, nor despotism, nor atomism, nor anarchy," but the humanization of laws and the equalization of social and economic forces by the State so that justice in its rational and objectively secular conception may at least be approximated. Social justice means the promotion of the welfare of all the people, the adoption by the Government of measures calculated to insure economic stability of all the competent elements of society, through the maintenance of a proper economic and social equilibrium in the interrelations of the members of the community, constitutionally, through the adoption of measures legally justifiable, or extra-constitutionally, through the exercise of powers underlying the existence of all governments on the time-honored principle of salus populi est suprema lex. Social justice, therefore, must be founded on the recognition of the necessity of interdependence among divers and diverse units of a society and of the protection that should be equally and evenly extended to all groups as a combined force in our social and economic life, consistent with the fundamental and paramount objective of the state of promoting the health, comfort, and quiet of all persons, and of bringing about "the greatest good to the greatest number."

In the case at bar, the veto of these specific provisions in the GAA is tantamount to dictating to the Judiciary how its funds should be utilized, which is clearly repugnant to fiscal autonomy. The freedom of the CJ to make adjustments in the utilization of the funds appropriated for the expenditures of the judiciary, including the use of any savings from any particular item to cover deficits or shortages in other items of the Judiciary is withheld. Fiscal autonomy means freedom from outside control. It can not be denied that the retired Justices have a vested right to the accrued pensions due them pursuant to RA 1797. The right to a public pension is of statutory origin. Any argument which seeks to remove special privileges given by law to former Justices of this Court and the ground that there should be no "grant of distinct privileges" or "preferential treatment" to retired Justices ignores these provisions of the Constitution and, in effect, asks that these Constitutional provisions on special protections for the Judiciary be repealed.

G.R. No. 119243 April 17, 1997 BREW MASTER FEDERATION OF LABOR UNIONS (NAFLU)

The SolGen was wrong when it said that giving public funds to retirees who are now living a private life is tantamount to robbery. All that the retirees ask is to be given the benefits granted by law. To characterize them as engaging in "robbery" is intemperate, abrasive, and disrespectful more so because the argument is unfounded.

v

NATIONAL

Facts: Complainant was employed by respondent as route helper. From 19 April 1993 up to 19 May 1993, complainant went on absent without permission (AWOP). On 20 May 1993, respondent thru Mr. Rodolfo Valentin, sent a Memo to complainant asking the latter why he should not be disciplined. Complainant justified that his wife left and he was forced to take his children back to Samar. Respondent issued a Notice of Termination stating that the complainant was aware of the company Rules and Regulations that absence without permission for 6 consecutive working days is considered abandonment of work.

For as long as these retired Justices are entitled under laws which continue to be effective, the government can not deprive them of their vested right to the payment of their pensions.

G.R. No. 47800. December 2, 1940 MAXIMO CALALANG, Petitioner, v. A. D. WILLIAMS

The LA dismissed the complaint for lack of merit, citing the principle of managerial control, which recognizes the employer's prerogative to prescribe

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Magsino Labor Relations Digests, Arbues 2019 reasonable rules and regulations to govern the conduct of his employees. The principle allows the imposition of disciplinary measures which are necessary for the efficiency of both the employer and the employees. NLRC modified the LA decision and held that complainant's dismissal was invalid. Complainant appellant's prolonged absences, although unauthorized, may not amount to gross neglect or abandonment of work to warrant outright termination of employment.

representative labor organization, the Association of Trade Unions and its local president and its board of directors. Private respondents also contended that the 30day notices of termination were duly sent to petitioners. LA ruled in favor of petitioners. NLRC reversed. Petitioners filed for R65 with the SC. They argued that their dismissal or retrenchment did not comply with the requirements of Art. 283 of the Labor Code.

Petitioner filed this special civil action contending that the NLRC committed grave abuse of discretion. It argued that the NLRC failed to consider the rationale behind petitioner's Rules and Regulation and that it was deprived of its prerogative to enforce them.

Issue: WON there is a valid retrenchment. Held: No. Under Art. 283 therefore retrenchment may be valid only when the following requisites are met: (a) it is to prevent losses; (b) written notices were served on the workers and DOLE at least one (1) month before the effective date of retrenchment; and, (c) separation pay is paid to the affected workers.

Issue: WON NLRC committed gradilej. Held: No. A scrutiny of the facts discloses that complainant's absence was precipitated by grave family problem as his wife unexpectedly deserted him and abandoned the family. Petitioner's finding that complainant was guilty of abandonment is misplaced. Abandonment as a just and valid ground for dismissal requires the deliberate, unjustified refusal of the employee to resume his employment. Two elements must then be satisfied: (1) the failure to report for work or absence without valid or justifiable reason; and (2) a clear intention to sever the employer-employee relation. The second element is the more determinative factor and must be evinced by overt acts. Likewise, the burden of proof is on the employer to show the employee's clear and deliberate intent to discontinue his employment without any intention of returning, mere absence is not sufficient. While we do not decide here the validity of petitioner's Rules and Regulations on continuous, unauthorized absences, what is plain is that it was wielded with undue haste resulting in a deprivation of due process, thus not allowing for a determination of just cause or abandonment.

The closure of a business establishment is a ground for the termination of the services of an employee unless the closing is for the purpose of circumventing pertinent provisions of the Labor Code. But while business reverses can be a just cause for terminating employees, they must be sufficiently proved by the employer. There is no question that an employer may reduce its work force to prevent losses. However, these losses must be serious, actual and real. Otherwise, this ground for termination of employment would be susceptible to abuse by scheming employers who might be merely feigning losses in their business ventures in order to ease out employees. As regards the requirement of notices of termination to the employees, it is undisputed that the Notice of Retrenchment was submitted to the DOLE on 12 September 1990. However, the employees were terminated either on September 25 or 30, 1990. The one-month notice of retrenchment filed with the DOLE and served on the workers before the intended date thereof is mandatory. Private respondents failed to comply with this requisite.

G.R. No. 110017 January 2, 1997 RODOLFO FUENTES v NLRC Facts: On 31 October 1990 petitioners filed with the DOLE office in Cagayan de Oro City a complaint for illegal dismissal with prayer for reinstatement, against private respondent Agusan Plantation, and/or Chang Chee Kong. In their answer respondents denied the allegations of petitioners and contended that upon receipt of instructions from the head office in Singapore to implement retrenchment, private respondentsconducted grievance conferences or meetings with petitioners

G.R. No. 112630 September 5, 1997

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CORAZON JAMER v NLRC

Magsino Labor Relations Digests, Arbues 2019 disposition of cases involving termination of employment since it affects one's source or means of livelihood, it should not be overlooked that the benefits accorded to labor do not include compelling an employer to retain the services of an employee who has been shown to be a gross liability to the employer. The intent is to balance the scale of justice; to put the two parties on relatively equal positions. There may be cases where the circumstances warrant favoring labor over the interests of management but never should the scale be so tilted if the result is an injustice to the employer, Justicia remini regarda est (Justice is to be denied to none).

Facts: Corazon Jamer and Christina Amortizado were employees of Isetan until they were terminated on August 31, 1990 on the alleged ground of dishonesty in their work as Store Cashiers. Complainants function as Store Cashiers is to reconcile the cash sales with the tally sheets to determine shortages or coverage. On July 16, 1990, complainants discovered a shortage of P15k. They did not immediately report the shortage to management hoping to find the cause of the shortage but to no avail they failed to reconcile the same. Hence, they had no other alternative but to report the same to the management on July 17, 1990. Respondent Isetan conducted an administrative investigation. Finding the explanation of the complainants to be unsatisfactory, respondent dismissed the complainants from the service on August 31, 1990.

As regards to the second requisite, the law requires that the employer must furnish the worker sought to be dismissed with 2 written notices before termination may be validly effected: first, a notice apprising the employee of the particular acts or omission for which his dismissal is sought and, second, a subsequent notice informing the employee of the decision to dismiss him. In accordance with this requirement, petitioners were given the required notices, on August 2 and then on August 23. The Court finds that petitioners were accorded due process before they were dismissed on August 3. It is a well-established rule that the essence of due process is simply an opportunity to be heard, or as applied to administrative proceedings, an opportunity to explain one's side or an opportunity to seek a reconsideration of the action or ruling complained of. Marcopper Mining Corporation vs. NLRC G.R. No. 103525. March 29, 1996

LA held that there was illegal dismissal. NLRC reversed. R65 with SC without filing MR with the NLRC. Issue: WON there was illegal dismissal. Held: No. Substantial evidence exists to warrant the finding that petitioners were validly dismissed for just cause and after observance of due process.

Facts: Under the Labor Code, as amended, the requirements for the lawful dismissal of an employee by his employer are two-fold: the substantive and the procedural. Not only must the dismissal be for a valid or authorized cause as provided by law (Articles 282, 283 and 284, of the Labor Code, as amended), but the rudimentary requirements of due process, basic of which are the opportunity to be heard and to defend himself, must be observed before an employee may be dismissed.

A CBA was entered into between Marcopper and NA-MAWU-MIF, a labor federation to which the Marcopper Employees Union (the exclusive bargaining agent of all rank-and-file workers of petitioner) is affiliated, to be effective 1 May 1984 until 30 April 1987. The CBA provides 2 wage increases. The 1st wage increase was with no problem. Private respondent, however, assailed the manner in which the second wage increase was effected. It argued that the COLA should first be integrated into the basic wage before the 5% wage increase is computed. Consequently, the union filed a complaint for underpayment of wages before the Regional Arbitration.

With respect to the first requisite, Article 282 of the Labor Code is controlling. The failure of petitioners to report the aforequoted shortages and overages to management as soon as they arose resulted in the breach of the fiduciary trust reposed in them by respondent company, thereby causing the latter to lose confidence in them. This warrants their dismissal.

Sec. 1 Art. V of the CBA provides: “It is expressly understood that this wage increase shall be exclusive of increase in the minimum wage and/or mandatory living allowance that may be promulgated during the life of this Agreement.” Accordingly, applying the aforequoted provision in the case at bench, petitioner concludes that it was clearly not the intention of the parties to include the COLA in

Social justice ceases to be an effective instrument for the "equalization of the social and economic forces" by the State when it is used to shield wrongdoing. While it is true that compassion and human consideration should guide the

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Magsino Labor Relations Digests, Arbues 2019 computing the CBA/MOA mandated increase since the MOA was entered into a year before E.O. No. 178 was enacted even though their effectivity dates coincide.

Sometime in December 1987, two supervisors almost simultaneously received two different requests for overseas calls bound for different Middle East countries and both callers reported the same calling number (98-68-16). Investigation shows that the subject number was temporarily disconnected on June 10, 1987, and permanently on September 24, 1987. It also showed that 439 overseas calls were made through the same number between May and November 1987.

Issue: WON EO 178 should supersede the CBA. Held: The principle that the CBA is the law between the contracting parties stands strong and true. However, the present controversy involves not merely an interpretation of CBA provisions. More importantly, it requires a determination of the effect of an executive order on the terms and the conditions of the CBA.

Private respondent Lettie Corpuz was employed as traffic operator at the Manila International Traffic Division (MITD) by PLDT. On July 26, 1988, Corpuz was asked to explain her alleged infraction, that is, facilitating 34 calls using the disconnected number. Instead of tendering the required explanation, respondent requested a formal investigation to allow her to confront the witnesses and rebut the proofs that may be brought against her. On grounds of serious misconduct and breach of trust, the Legal Department recommended her dismissal. In a letter dated June 16, 1989, respondent was terminated from employment effective the following day.

Petitioner’s arguments eventually lose steam in the light of the fact that compliance with the law is mandatory and beyond contractual stipulation by and between the parties; consequently, whether or not petitioner intended the basic wage to include the COLA becomes immaterial. There is evidently nothing to construe and interpret because the law is clear and unambiguous. Unfortunately for petitioner, said law, by some uncanny coincidence, retroactively took effect on the same date the CBA increase became effective. Therefore, there cannot be any doubt that the computation of the CBA increase on the basis of the integrated wage does not constitute a violation of the CBA.

LA ordered her reinstatement. NLRC affirmed. PetCert was filed by PLDT to SC. Issue: WON there was a valid dismissal.

While the terms and conditions of the CBA constitute the law between the parties, it is not, however, an ordinary contract to which is applied the principles of law governing ordinary contracts. A CBA, as a labor contract within the contemplation of Article 1700 of the Civil Code of the Philippines which governs the relations between labor and capital, is not merely contractual in nature but impressed with public interest, thus, it must yield to the common good. As such, it must be construed liberally rather than narrowly and technically, and the courts must place a practical and realistic construction upon it, giving due consideration to the context in which it is negotiated and purpose which it is intended to serve.

G.R. No. 111933. July 23, 1997

Held: No. The right of an employer to freely discharge his employees is subject to regulation by the State, basically through the exercise of its police power. This is so because the preservation of the lives of citizens is a basic duty of the State, an obligation more vital than the preservation of corporate profits. Petitioner insists that respondent was guilty of defrauding them when she serviced 56 of the 439 calls coming from telephone number 98-68-16 and received numerous requests for overseas calls virtually from the same calling number, which could not have been a mere coincidence but most likely was a pre-arranged undertaking in connivance with certain subscribers. The records show, however, that the subject phone calls were neither unusual nor coincidental as other operators shared similar experiences. *Substantial Evidence Rule; The Supreme Court will not sanction a dismissal premised on mere conjectures and suspicions.· This Court will not sanction a dismissal premised on mere conjectures and suspicions. To be a valid ground for respondent’s dismissal, the evidence must be substantial and not arbitrary and must

PLDT v NLRC

Facts:

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Magsino Labor Relations Digests, Arbues 2019 In any event, apart from the State’s police power, the Constitution itself mandates government to extend the fullest protection to our overseas workers. The basic constitutional statement on labor, embodied in Section 18 of Article II of the Constitution provides: Sec. 18. The State affirms labor as a primary social economic force. It shall protect the rights of workers and promote their welfare. More emphatically, the social justice provision on labor of the 1987 Constitution in its first paragraph states: The State shall afford full protection to labor, local and overseas, organized and unorganized and promote full employment and equality of employment opportunities for all. Obviously, protection to labor does not indicate promotion of employment alone. Under the welfare and social justice provisions of the Constitution, the promotion of full employment, while desirable, cannot take a backseat to the government’s constitutional duty to provide mechanisms for the protection of our workforce, local or overseas.

be founded on clearly established facts sufficient to warrant his separation from work. *Security of Tenure; In carrying out and interpreting the Labor Code’s provisions and its implementing regulations, the workingman’s welfare should be the primordial and paramount consideration; The constitutional right of workers to security of tenure should not be denied on mere speculation of any unclear and nebulous basis.

JMM Promotion v CA

G.R. No. 120095. August 5, 1996

Facts: Due to the death of Maricris Sioson in 1991, Cory banned the deployment of performing artists to Japan and other destinations. This was relaxed however with the introduction of the Entertainment Industry Advisory Council which later proposed a plan to POEA to screen and train performing artists seeking to go abroad. In pursuant to the proposal POEA and the secretary of DOLE sought a 4 step plan to realize the plan which included an Artist’s Record Book which a performing artist must acquire prior to being deployed abroad. The Federation of Talent Managers of the Philippines assailed the validity of the said regulation as it violated the right to travel, abridge existing contracts and rights and deprives artists of their individual rights. JMM intervened to bolster the cause of FETMOP. The lower court ruled in favor of EIAC.

A profession, trade or calling is a property right within the meaning of our constitutional guarantees. One cannot be deprived of the right to work and the right to make a living because these rights are property rights, the arbitrary and unwarranted deprivation of which normally constitutes an actionable wrong. Nevertheless, no right is absolute, and the proper regulation of a profession, calling, business or trade has always been upheld as a legitimate subject of a valid exercise of the police power by the state particularly when their conduct affects either the execution of legitimate governmental functions, the preservation of the State, the public health and welfare and public morals. According to the maxim, sic utere tuo ut alienum non laedas, it must of course be within the legitimate range of legislative action to define the mode and manner in which every one may so use his own property so as not to pose injury to himself or others.

Issue: WON the issuances were a valid exercise of police power. Held: Yes. The latin maxim salus populi est suprema lex embodies the character of the entire spectrum of public laws aimed at promoting the general welfare of the people under the State’s police power. As an inherent attribute of sovereignty which virtually extends to all public needs, this least limitable of governmental powers grants a wide panoply of instruments through which the state, as parens patriae gives effect to a host of its regulatory powers. Thus, police power concerns government enactments which precisely interfere with personal liberty or property in order to promote the general welfare or the common good. As the assailed Department Order enjoys a presumed validity, it follows that the burden rests upon petitioners to demonstrate that the said order, particularly, its ARB requirement, does not enhance the public welfare or was exercised arbitrarily or unreasonably.

Locally, the Professional Regulation Commission has begun to require previously licensed doctors and other professionals to furnish documentary proof that they had either re-trained or had undertaken continuing education courses as a requirement for renewal of their licenses. It is not claimed that these requirements pose an unwarranted deprivation of a property right under the due process clause. So long as professionals and other workers meet reasonable regulatory standards no such deprivation exists. The equal protection clause of the Constitution does not forbid classification for so long as such classification is based on real and substantial differences having a reasonable relation to the subject of the particular legislation. the equal protection clause of the Constitution does not forbid classification for so long as such classification is based on real and substantial differences having a reasonable relation to the subject of the particular legislation.

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Magsino Labor Relations Digests, Arbues 2019 Philippine Association of Service Exporters, Inc. vs. Drilon No. L-81958. June 30,1988.

The same, however, cannot be said of our male workers. In the first place, there is no evidence that, except perhaps for isolated instances, our men abroad have been afflicted with an identical predicament. The petitioner has proffered no argument that the Government should act similarly with respect to male workers. The Court, of course, is not impressing some male chauvinistic notion that men are superior to women. What the Court is saying is that it was largely a matter of evidence (that women domestic workers are being ill-treated abroad in massive instances) and not upon some fanciful or arbitrary yardstick that the Government acted in this case. It is evidence capable indeed of unquestionable demonstration and evidence this Court accepts. The Court cannot, however, say the same thing as far as men are concerned. There is simply no evidence to justify such an inference. Suffice it to state, then, that insofar as classification are concerned, this Court is content that distinctions are borne by the evidence. Discrimination in this case is justified.

Facts: Phil association of Service Exporters, Inc., is engaged principally in the recruitment of Filipino workers, male and female of overseas employment. It challenges the constitutional validity of Dept. Order No. 1 (1998) of DOLE entitled “Guidelines Governing the Temporary Suspension of Deployment of Filipino Domestic and Household Workers.” It claims that such order is a discrimination against males and females. The Order does not apply to all Filipino workers but only to domestic helpers and females with similar skills, and that it is in violation of the right to travel, it also being an invalid exercise of the lawmaking power. Further, PASEI invokes Sec 3 of Art 13 of the Constitution, providing for worker participation in policy and decision-making processes affecting their rights and benefits as may be provided by law. Thereafter the Solicitor General on behalf of DOLE submitting to the validity of the challenged guidelines involving the police power of the State and informed the court that the respondent have lifted the deployment ban in some states where there exists bilateral agreement with the Philippines and existing mechanism providing for sufficient safeguards to ensure the welfare and protection of the Filipino workers.

Protection to labor" does not signify the promotion of einployment alone. What concerns the Constitution more paramountly is that such an employment be above all, decent, just, and humane. It is bad enough that the country has to send its sons and daughters to strange lands because it cannot satisfy their employment needs at home. Under these circumstances, the Government is duty-bound to insure that our toiling expatriates have adequate protection, personally and economically, while away from home. In this case, the Government has evidence, an evidence the petitioner cannot seriously dispuce, of the lack or inadequacy of auch protection, and as part of its duty, it has precisely ordered an indefinite ban on deployment.

Issue: WON DO 1-1998 is a valid exercise of police power. Held: Yes. Police power has been defined as the "state authority to enact legislation that may interfere with personal liberty or property in order to promote the general welfare." As defined, it consists of (1) an imposition of restraint upon liberty or property, (2) in order to foster the common good.

·The petitioner's reliance on the Constitutional guaranty of worker participation "in policy and decisionmaking processes affecting their rights and benefits" is not well taken. The right granted by this provision, again, must submit to the demands and necessities of the State's power of regulation. The nonimpairment clause of the Constitution, invoked by the petitioner, must yield to the loftier purposes targetted by the Government. Freedom of contract and enterprise, like all other freedoms, is not free from restrictions, more so in this jurisdiction, where laissez faire has never been fully accepted as a controlling economic-way of life.

The petitioner has shown no satisfactory reason why the contested measure should be nullified. There is no question that Department Order No. 1 applies only to "female contract workers," but it does not thereby make an undue discrimination between the sexes. It is well-settled that "equality before the law" under the Constitution does not import a perfect identity of rights among all men and women. It admits of classifications, provided that (1) such classiflcations rest on substantial distinctions; (2) they are germane to the purposes of the law; (3) they are not confined to existing conditions; and (4) they apply equally to all members of the same class. The Court is satisfied that the classification made – the preference for female workers - rests on substantial distinctions.

G.R. No. 95449. August 18, 1997 PHILIPPINE-SINGAPORE TRANSPORT SERVICES (PSTS) v NLRC Facts:

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Magsino Labor Relations Digests, Arbues 2019 Petitioner PSTS, a manning agency, hired private respondent Estrada as master of the vessel Sea Carrier I for its foreign principal, Intra-Oil in the high seas of Bombay, India. On January 21, 1988 or barely two months following his employment, Estrada was that he would be relieved from his employment and be repatriated. Upon his arrival, he went to PSTS to ask about his dismissal from employment and to claim for his unpaid salary and the sum corresponding to his plane fare which was deducted from his salary. Petitioner PSTS informed him that his service was terminated due to his incompetence. It also denied his claim for the sum of money.

Estrada was dismissed without just cause. Bale, inutusan kasi siya na maghila ng barko pero ayaw niya kasi luma na yung lubid na panghila. Nireport niya na luma na yung lubid pero walang dumating na bago. Before an employee can be dismissed, the Labor Code requires the employer to furnish the employee a written notice containing a statement of the causes for termination and to afford said employee ample opportunity to be heard. If the employer decides to terminate the services of the employee, the employer must notify the worker in writing of the decision to dismiss him, stating clearly the reasons therefor. Petitioner seeks to justify the absence of the said notice and hearing by invoking a provision in the contract of employment which authorizes the company to terminate employment without notice. Such contractual provision is inapplicable here. The said provision applies only when the employee is liable for serious misconduct, neglect of duty or violation of company rules and regulations. Apparently, private respondent Estrada was not found guilty of any of these offenses.

Estrada filed in POEA Adjudication Department a complaint against PSTS and Intra-Oil for illegal dismissal. POEA granted the petition. NLRC affirmed holding that respondent’s repatriation was not due to his incompetence but due to his refusal to tow another barge belonging to the charterer and which refusal had been shown to be justified by the private respondent. Issue:

WON the management exercised its prerogative properly.

Held:No. The power to dismiss an employee is a recognized prerogative that is inherent in the employer’s right to freely manage and regulate his business. An employer cannot rationally be expected to retain the employment of a person whose lack respect to his employer. The right of the company to dismiss an employee is a measure of self-protection. Such right, however, is subject to regulation by the State, basically in the exercise of its paramount police power. Thus, the dismissal of employees must be made within the parameters of the law and pursuant to the basic tenets of equity, justice and fairplay. It must not be done arbitrarily and without just cause.

Chu v NLRC and VICTORIAS MILLING G.R. No. 106107. June 2, 1994 Facts: Petitioner retired from service but under a Special Contract of Employment, petitioner was employed as Head of the Warehousing Department. Private respondent issued 2 Memos both providing for a rotation of the personnel and other organizational changes. Pursuant to the memos, petitioner was transferred to the Sugar Sales Department. Petitioner protested his transfer and requested a reconsideration thereof, which was denied.

Article 279 of the Labor Code provides that the security of tenure has been construed to mean as that the employer shall not terminate the services of an employee except for a just cause or when authorized by the Code. The two facets of this legal provision are: (a) the legality of the act of dismissal; and (b) the legality in the manner of dismissal. The illegality of the act of dismissal constitutes discharge without just cause, while illegality in the manner of dismissal is dismissal without due process. If an employee is dismissed without just cause, he is entitled to reinstatement with backwages up to the time of his actual reinstatement, if the contract of employment is not for a definite period; or to the payment of his salaries corresponding to the unexpired portion of the employment contract, if the contract is for the definite period. If the dismissal is for a just cause but it was made without due process, the employee is entitled to the payment of an indemnity.

Petitioner filed a complaint for illegal dismissal, contending that he was constructively dismissed from his employment. LA dismissed the complaint holding that petitioner’s transfer was without change in rank or salary; (3) petitioner’s designation in either department was the same; (4) the personnel rotation was pursuant to organizational changes done in the valid exercise of management prerogatives; (5) there was no bad faith in the transfer and (6) petitioner failed to

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Magsino Labor Relations Digests, Arbues 2019 show that he was prejudiced by the changes or transferred to a demeaning or humiliating position. NLRC affirmed.

afternoon workers shall report from Sunday to Thursday and the night shift workers shall work from Thursday to Sunday. On November 6, 1972, the night shift employees filed a demand to maintain the old working schedule from Monday thru Friday. In manifestation of their dissention to the new work schedule, the 3 respondents Duro, Torio, and Javillonar did not report for work. Their absence caused their suspension for 14 days. LA ordered their reinstatement but secretary of labor reversed.

Issue: WON there was a valid exercise of management prerogative. Held: Yes. ·An owner of a business enterprise is given considerable leeway in managing his business because it is deemed important to society as a whole that he should succeed. Our law, therefore, recognizes certain rights as inherent in the management of business enterprises. These rights are collectively called management prerogatives or acts by which one directing a business is able to control the variables thereof so as to enhance the chances of making a profit. Together, they may be taken as the freedom to administer the affairs of a business enterprise such that the costs of running it would be below the expected earnings or receipts. In short, the elbow room in the quest for profits.

Issue: WON there was valid dismissal due to insubordination. Held: Yes. Management retained the prerogative, whenever exigencies of the service so require, to change the working hours of its employees. And as long such prerogative is exercised in good faith for the advancement of the employerÊs 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 such exercise. Even as the law is solicitous of the welfare of employees, it must also protect the right of an employer to exercise what are clearly management prerogatives. The free will of management to conduct its own business affairs to achieve its purpose cannot be denied.

It is the employer’s prerogative, based on its assessment and perception of its employees’ qualifications to move them around in the various areas of its business operations in order to ascertain where they will function with maximum benefit to the company. An employee’s right to security of tenure does not give him such a vested right in his position as would deprive the company of its prerogative to change his assignment or transfer him where he will be most useful. When his transfer is not unreasonable, nor inconvenient, nor prejudicial to him, and it does not involve a demotion in rank or a diminution of his salaries, benefits, and other privileges, the employee may not complain that it amounts to a constructive dismissal.

Further, the incident complained of took place sometime in 1972, so there is no violation of the 1973 Constitution to speak of because the guarantee of security of tenure embodied under Section 9, Article II may not be given a retroactive effect. It is the basic norm that provisions of the fundamental law should be given prospective application only, unless legislative intent for its retroactive application is so provided.

Nothing in the Special Contract of Employment invoked by petitioner wherein private respondent had waived its right to transfer or re-assign petitioner to any other position in the company. Before such right can be deemed to have been waived or contracted away, the stipulation to that effect must be clearly stated so as to leave no room to doubt the intentions of the parties. The mere specification in the employment contract of the position to be held by the employee is not such stipulation. Union Carbide Labor Union vs. Union Carbide Phils. G.R. No. 41314 November 13, 1992

San Miguel Brewery Sales Force Union (PTGWO) vs. Ople G.R. No. 53515. February 8, 1989

Facts:

Facts:

The Company used to operate morning, afternoon, and night shifts. Pursuant to the CBA, a new work schedule was implemented where the morning and

For 3 years, a collective bargaining agreement was being implemented by San Miguel Corporation Sales Force Union (PTGWO), and San Miguel Corporation.

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Magsino Labor Relations Digests, Arbues 2019 Section 1, of Article IV of which provided “Employees within the appropriate bargaining unit shall be entitled to a basic monthly compensation plus commission based on their respective sales.” Then, the company introduced a marketing scheme known as “Complementary Distribution System”(CDS) whereby its beer products were offered for sale directly to wholesalers through San Miguel’s Sales Offices. The union alleged that the new marketing scheme violates Sec 1, Art IV of the CBA because the introduction of the CDS would reduce the take home pay of the salesmen.

respondent. By the order of the CIR, and amicable settlement was reached. The General Manager thereafter met and rectified many of the demands of the Union but the dispute continued. Respondent filed a petition with the CIR. It alleged that promotions are based on union affiliation and that to further discourage membership in the GSISSU, the GSIS bargained with a rank and file union in the GSIS on the terms and conditions of employment of employees who pertain to the certified supervisory bargaining unit. CIR ordered the GSIS to appoint Dr. Andrea Moral as Acting Assistant Medical Director, replacing the present incumbent, Dr. Orlando Misa.

Issue: WON the CDS was a valid exercise of management prerogative. Issue: WON the CIR’s order violated the management prerogative. Held: Yes. Public respondent was correct in holding that the CDS is a valid exercise of management prerogatives. Except as limited by special laws, an employer is free to regulate, according to his own discretion and judgment, all aspects of employment, including hiring, work assignments, working methods, time, place and manner of work, tools to be used, processes to be followed, supervision of workers, working regulations, transfer of employees, work supervision, lay-off of workers and the discipline, dismissal and recall of work.

Held: Yes. The right to select and appoint employees is the prerogative of the employer, the privilege of management because such right inheres in the conduct and operation of the business by the employer. Labor may not impose nor demand who is to be appointed or designated by management. This discretion or judgment lodged in management may not, therefore, be controlled, interfered with or substituted by the CIR upon petition or representation of the striking labor union.

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. San Miguel Corporation’s offer to compensate the members of its sales force who will be adversely affected by the implementation of the CDS, by paying them a so-called back adjustment commission to make up for the commissions they might lose as a result of the CDS, proves the company’s good faith and lack of intention to bust their union.

The promotion of Misa was fair and made in good faith. It has not been shown by any credible proof submitted to the Hearing Officer or to the CIR that such selection was arbitrary. The claim of the respondent Union that the designation of Dr. Misa and not Dr. Moral is discriminatory on account of the latter’s being a member of the Union has not been sufficiently proved for there is nothing in the Report submitted by the Hearing Officer clearly indicating that the GSIS preferred Dr. Misa instead of Dr. Moral in order to bust the GSISSU or to discourage membership in said union. The Report made no finding if the protagonists belong to different camps or even slightly that for union considerations, the GSIS favored one or the other. In the promotion; of personnel the basic consideration is efficiency in public service, even to the disappointment of aspirants longer in the service.

GSIS vs. GSIS Supervisors’ Union

No. L-39575. August 31, 1978

PT&T vs CA G.R. No. 152057. September 29, 2003

Facts:

Facts:

A strike was called and staged by respondent in protest against the discriminatory acts constituting unfair labor practices in matters of promotion, among others, committed by the management of the petitioner against the

Petitioner, after conducting a series of studies regarding the profitability of its retail operations, its existing branches and the number of employees, the petitioner came up with a Relocation and Restructuring Program Private respondents

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Magsino Labor Relations Digests, Arbues 2019 received separate letters from the petitioner, giving them the option to choose the branch to which they could be transferred. Thereafter, through HRAG Bulletin No. 97-06-16, the private respondents and other petitioner's employees were directed to "relocate" to their new PT&T Branches. The affected employees were directed to report to their respective relocation assignments. Moreover, the employees who would agree to the transfers would be considered promoted.

nature of a gift or reward, which a person has a right to refuse. Hence, the exercise by the private respondents of their right cannot be considered in law as insubordination, or willful disobedience of a lawful order of the employer. As such, there was no valid cause for the respondent’s dismissal. *Promotion Promotion is the advancement from one position to another with an increase in duties and responsibilities as authorized by law, and usually accompanied by an increase in salary. The indispensable element for there to be a promotion is that there must be an advancement from one position to another or an upward vertical movement of the employee’s rank or position. Any increase in salary should only be considered incidental but never determinative of whether or not a promotion is bestowed upon an employee. This can be likened to the upgrading of salaries of government employees without necessarily conferring upon them the concomitant elevation to higher positions.

The private respondents rejected the petitioner's offer. Petitioner, then, sent letters to the private respondents requiring them to explain in writing why no disciplinary action should be taken against them for their refusal to be transferred/relocated. In their respective replies to the petitioner's letters, the private respondents explained that: The transfers imposed by the management would cause enormous difficulties on the individual complainants. For one, their new assignment involves distant places which would require their separation from their respective families. Dissatisfied with this explanation, the petitioner considered the private respondents' refusal as insubordination and willful disobedience to a lawful order; hence, the private respondents were dismissed from work. They forthwith filed their respective complaints against the petitioner before the appropriate sub-regional branches of the NLRC. In their position paper, private respondents declared that their refusal to transfer could not possibly give rise to a valid dismissal on the ground of willful disobedience, as their transfer was prejudicial and inconvenient; thus unreasonable. The private respondents further opined that since their respective transfers resulted in their promotion, they had the right to refuse or decline the positions being offered to them. Resultantly, the refusal to accept the transfers could not have amounted to insubordination or willful disobedience to the "lawful orders of the employer."

ELMER M. MENDOZA v RURAL BANK OF LUCBAN G.R. No. 155421 July 7, 2004

For its part, the company alleged that the private respondents' transfers were made in the lawful exercise of its management prerogative and were done in good faith. The transfers were aimed at decongesting surplus employees and detailing them to a more demanding branch.

Facts: On April 25, 1999, the Board of Directors of the Rural Bank of Lucban, Inc., issued Board Resolution Nos. 99-52 and 99-53, “that in line with the policy of the bank to familiarize bank employees with the various phases of bank operations and further strengthen the existing internal control system, all officers and employees are subject to reshuffle of assignments. Moreover, this resolution does not preclude the transfer of assignment of bank officers and employees from the branch office to the head office and vice-versa."

Issue: WON the management prerogative was valid. Held: No. An employee cannot be promoted, even if merely as a result of a transfer, without his consent. A transfer that results in promotion or demotion, advancement or reduction or a transfer that aims to lure the employee away from his permanent position cannot be done without the employees’ consent. There is no law that compels an employee to accept a promotion for the reason that a promotion is in the

Petitioner filed a Complaint before NLRC. Petitioner argued that he had been demoted from appraiser to clerk and not given any work to do, while his table had been placed near the toilet and eventually removed. He adds that the reshuffling

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Magsino Labor Relations Digests, Arbues 2019 of employees was done in bad faith, because it was designed primarily to force him to resign.

advancement of the establishment. Petitioner was not singled out; other employees were also reassigned without their express consent.

Issue: WON the reshuffling was valid. Held: Yes. In the pursuit of its legitimate business interest, management has the prerogative to transfer or assign employees from one office or area of operation to another provided there is no demotion in rank or diminution of salary, benefits, and other privileges; and the action is not motivated by discrimination, made in bad faith, or effected as a form of punishment or demotion without sufficient cause. This privilege is inherent in the right of employers to control and manage their enterprise effectively. The right of employees to security of tenure does not give them vested rights to their positions to the extent of depriving management of its prerogative to change their assignments or to transfer them. Managerial prerogatives, however, are subject to limitations provided by law, CBAs, and general principles of fair play and justice.

Yuco Chemical Industries, Inc. vs. Ministry of Labor and Employment G.R. No. 75656 May 28, 1990 Facts: Private respondents George Halili and Amado Magno were employed by petitionercompany which is engaged in the manufacture/assembly of ice boxes. They were assigned to make aluminum handles for the ice boxes. On August 12,1981, after obtaining a favorable legal opinion from the Tarlac provincial office of MOLE concerning the legality of moving the production of aluminum handles from Tarlac to Manila, petitioner addressed a memorandum to private respondents directing them to report for work within one week from notice at their new place of work at Sta. Cruz, Manila. The memorandum further stated that private respondents would be paid with a salary of P27.00 and an additional allowance of P2.00 "to meet the higher cost of living in Manila. A day after or on August 13, 1981, instead of complying with the memorandum, private respondents filed a complaint with the provincial labor office for illegal dismissal.

The managerial prerogative to transfer personnel must be exercised without grave abuse of discretion, bearing in mind the basic elements of justice and fair play. Having the right should not be confused with the manner in which that right is exercised. Thus, it cannot be used as a subterfuge by the employer to rid himself of an undesirable worker. In particular, the employer must be able to show that the transfer is not unreasonable, inconvenient or prejudicial to the employee; nor does it involve a demotion in rank or a diminution of his salaries, privileges and other benefits. Should the employer fail to overcome this burden of proof, the employee’s transfer shall be tantamount to constructive dismissal, which has been defined as a quitting because continued employment is rendered impossible, unreasonable or unlikely; as an offer involving a demotion in rank and diminution in pay. Likewise, constructive dismissal exists when an act of clear discrimination, insensibility or disdain by an employer has become so unbearable to the employee leaving him with no option but to forego with his continued employment.

Issue: WON the transfer was valid. Held: The managerial prerogative to transfer personnel must be exercised without grave abuse of discretion and putting to mind the basic elements of justice and fair play. Having the right should not be confused with the manner in which that right must be exercised. Thus it cannot be used as a subterfuge by the employer to rid himself of an undesirable worker. Nor when the real reason is to penalize an employee for his union activities and thereby defeat his right to self-organization. But the transfer can be upheld when there is no showing that it is unnecessary, inconvenient and prejudicial to the displaced

Petitioner’s transfer was made in pursuit of respondent’s policy to familiarize bank employees with the various phases of bank operations and further strengthen the existing internal control system of all officers and employees. Employees may be transferred based on their qualifications, aptitudes and competencies to positions in which they can function with maximum benefit to the company. There appears no justification for denying an employer the right to transfer employees to expand their competence and maximize their full potential for the

The reassignment of Halili and Magno to Manila is legally indefensible on several grounds. Firstly, it was grossly inconvenient to private respondents. They are working students. When they received the transfer memorandum directing their

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Magsino Labor Relations Digests, Arbues 2019 relocation to Manila within seven days from notice, classes had already started. The move from Tarlac to Manila at such time would mean a disruption of their studies. Secondly, there appears to be no genuine business urgency that necessitated their transfer. As well pointed out by private respondents’ counsel, the fabrication of aluminum handles for ice boxes does not require special dexterity. Many workers could be contracted right in Manila to perform that particular line of work. Altogether, there is a strong basis for public respondentÊs conclusion that the controversial transfer was not prompted by legitimate reasons. Petitioner company had indeed discriminated against Magno and Halili when the duo was selected for reassignment to Manila. The transfer was timed at the height of union concerted activities in the firm, deliberately calculated to demoralize the other union members. Under such questionable circumstances, private respondents had a valid reason to refuse the Manila reassignment. Public respondent did not err or abuse his discretion in upholding the employees’ cause.

Issue: WON there was valid dismissal. Held: No. There are restrictions to guide the employers in the exercise of management prerogatives, particularly the right to discipline or dismiss employees, for both the Constitution and the law guarantee employees’ security of tenure. Thus, employees may be dismissed only in the manner provided by law. The right of the employer must not be exercised arbitrarily and without just cause. Otherwise, the constitutional mandate of security of tenure of the workers would be rendered nugatory. But while Clarete may be guilty of violation of company rules, we find the penalty of dismissal imposed upon him by respondent Caltex too harsh and unreasonable. Penalty of dismissal must be commensurate with the act, conduct or omission imputed to the employee and imposed in connection with the employer’s disciplinary authority. Even when there exist some rules agreed upon between the employer and employee on the subject of dismissal the same cannot preclude the State from inquiring on whether its rigid application would work too harshly on the employee. The penalty of dismissal imposed on Clarete is unduly harsh and grossly disproportionate to the reason for terminating his employment. Clarete has no previous record in his eight years of service; that respondent Caltex did not lose anything as the bottle of lighter fluid was retrieved on time; and that there was no showing that Clarete’s retention in the service would work undue prejudice to the viability of employer’s operations . G.R. No. 70479 February 27, 1987 FIRESTONE TIRE AND RUBBER v CARLOS LARIOSA

Caltex Refinery Employees Association (CREA) v NLRC G.R. No. 102993. July 14, 1995 Facts: Petitioner Arnelio Clarete and Caltex gave facts. Clarete argued that he found a bottle of lighter fluid in the rubbish pile. He asked the security guard de Villa posted at the gate to allow him to bring the bottle home. De Villa referred Clarete to Castillo, the security supervisor. Castillo instructed Clarete to leave the bottle in his office. Clarete went home without the bottle. Caltex on the other hand, argued that Clarete refused to allow de Villa to inspect hi bag as it was just filled with work clothes. De Villa opened the bag and found the lighter fluid hidden in the sleeves of his Clarete’s clothes. When asked about the gate pass for the fluid, Clarete said he did not need one as it was for his personal use.

Facts: When Lariosa submitted himself for routine check before going out of the factory, the security guards found 16 wool flannel swabs all belonging to the company. Why he placed the swabs in his personal bag, which is not the usual receptacle for company property, has not been satisfactorily explained. Lariosa was terminated for stealing company property and loss of trust. A criminal complaint for theft was filed against Lariosa. Lariosa filed a complaint for illegal dismissal. LA found the dismissal justified. NLRC reversed.

In a letter, Caltex asked Clarete why he should not be disciplined. Clarete replied that he had no intention to bring the bottle home without permission. However, he was thereafter charged with theft. Clarete was acquitted. His services were terminated for serious misconduct and loss of trust and confidence resulting from having violated a lawful order of the Company.

Issue: WON the termination was too severe. Held: No.

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Magsino Labor Relations Digests, Arbues 2019 A review of the record shows that Lariosa was indubitably involved in the attempted theft of the flannel swabs. There is no gainsaying that theft committed by an employee constitutes a valid reason for his dismissal by the employer. Although as a rule this Court leans over backwards to help workers and employees continue with their employment or to mitigate the penalties imposed on them, acts of dishonesty in the handling of company property are a different matter.

resolve the conflicting issue, Glaxo offered Tecson a separation pay or to be transferred from Camarines to Butuan-Surigao-Agusan sales area to which the former refused to abide. Aggrieved, Tecson filed a petition to the National Conciliation and Mediation Board (NCMB) which affirmed Glaxo’s policy as valid. CA affirmed NCMB’s decision, hence, this petition. Issue: May an employer prohibit an employee to marry.

Thus, under Article 283 of the Labor Code, an employer may terminate an employment for "serious misconduct" or for "fraud or willful breach by the employee of the trust reposed in him by his employer or representative."

Held: It depends. If the prohibition or restriction pertains to the choice of spouse, rather than the choice to marry at all, there should be an examination of the rationale behind the constraint. If the restrictions or conditions bear no relevance to any interests that the employer should be concerned with, then they should not be upheld. Restrictions that are nothing more than the enforcement of personal biases, such as prohibitions on marrying members of a particular race or ethnic group, may be struck down.

If there is sufficient evidence that an employee has been guilty of a breach of trust or that his employer has ample reasons to distrust him, the labor tribunal cannot justly deny to the employer the authority to dismiss such an employee. If Lariosa, by his own wrong-doing, could no longer be trusted, it would be an act of oppression to compel the company to retain him, fully aware that such an employee could, in the long run, endanger its very viability.

If the rationale in question relates to a consideration so vital to the interests of the employer as to warrant legal protection, it should then be determined whether the means employed by the employer are reasonable enough as to allow a measure of balance between these key interests of the employer and the fundamental right of the employee to marry.

The employer's obligation to give his workers just compensation and treatment carries with it the corollary right to expect from the workers adequate work, diligence and good conduct. DUNCAN ASSOCIATION v GLAXO WELLCOME G.R. No. 162994 September 17, 2004

Pedro A. Tecson was hired by respondent Glaxo Wellcome Philippines, Inc. as medical representative. As stipulated in the contract signed and agreed by Tecson, The Glaxo provides that an employee is expected to inform management of any existing or future relationship by consanguinity or affinity with co-employees or employees of competing drug companies. If management perceives a conflict of interest or a potential conflict between such relationship and the employee’s employment with the company, the management and the employee will explore the possibility of a “transfer to another department or preparation for employment outside the company after six months.

Glaxo belongs to the highly competitive pharmaceutical industry. Glaxo is entitled to guard its trade secrets, manufacturing formulas, marketing strategies and other confidential programs and information from competitors, concomitant to its right to protect its own economic interests. It is but reasonable for Glaxo to be cautious about the social interaction of its employees with those of companies which it directly competes with. If the employee goes as far as sharing hearth and home with the employee of the rival company, there is greater cause of concern on the part of Glaxo. The fear may not so much arise from the possibility of willful betrayal by its employees of trade secrets, but from the myriad opportunities in the course of shared lives that one may inadvertently divulge to the spouse confidential information that the rival drug company may benefit from. After all, the employer has no control over pillow talk. Neither could it be expected that the employee maintain a higher fidelity to the employer than to the spouse.

Subsequently, Tecson entered into a romantic relationship with Bettsy, an employee of Astra Pharmaceuticals, a competitor of Glaxo. In 1998,Tecson married Bettsy, whilst constantly reminded by the District Manager regarding the conflict of interest which his relationship with Bettsy might engender. When Tecson failed to

Still, these concerns aside, the steps that Glaxo may employ to avoid the undue divulgence of its trade secrets should be within reason. If termination is to be considered as an option, it should be only as a final resort. In this case, Glaxo's assailed policy does not call for automatic termination, providing as it does a process

Facts:

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Magsino Labor Relations Digests, Arbues 2019 that allows for all the opportunities for a mutually agreeable solution. Per the Employee Handbook, "every effort shall be made, together by management and the employee, to arrive at a solution within 6 months, either by transfer to another department in a non-counter checking position, or by career preparation toward outside employment after Glaxo Wellcome. Employees must be prepared for possible resignation within 6 months, if no other solution is feasible." This procedure is extremely reasonable under the circumstances, and we have no problems in upholding its validity.

Respondent Nestle’s Drug Abuse Policy states that illegal drugs and use of regulated drugs beyond the medically prescribed limits are prohibited in the workplace. Illegal drug use puts at risk the integrity of Nestle operations and the safety of our products. It is detrimental to the health, safety and work-performance of employees and is harmful to the welfare of families and the surrounding community. Company personnel policies are guiding principles stated in broad, longrange terms that express the philosophy or beliefs of an organizations top authority regarding personnel matters. They deal with matter affecting efficiency and wellbeing of employees and include, among others, the procedure in the administration of wages, benefits, promotions, transfer and other personnel movements which are usually not spelled out in the collective agreement. Considering that the Drug Abuse Policy is a company personnel policy, it is the Voluntary Arbitrators or Panel of Voluntary Arbitrators, not the RTC, which exercises jurisdiction over this case.

Glaxo must retain the said policy, and should another employee trek the same trail as Tecson did, it cannot be foreordained that the Court would similarly rule for Glaxo and against the said employee. As repeatedly emphasized, it all depends on the particular circumstances of each case. And ultimately, if dismissal, constructive or otherwise, is resorted to, the standards for termination set by the Labor Code must still be complied with.

G.R. No. 127598.January 28, 2002

MERALCO vs Secretary of Labor

Facts: On March 15, 1999, Atty. Tomacruz and FLAMES entered into a "Contract for Professional Service," under which FLAMES undertook to pay Atty. Tomacruz for his legal services.

G.R. No. 148303. October 17, 2002 UNION OF NESTLE WORKERS CAGAYAN DE ORO FACTORY (UNWCF) vs. NESTLE PHILPPINES Facts:

FLAMES had already delivered to Atty. Tomacruz the P50k as acceptance fee and another P50k representing his contingent fee under their contract. FLAMES explained to Atty. Tomacruz that pending efforts to collect from its members, it could only effect partial payment of his fee due to financial constraints. After the lapse of more than a year with no payments being made, Atty. Tomacruz wrote FLAMES demanding the balance of his stipulated fee under the contract of service, computed at 15% of the amount which each FLAMES member received from MERALCO or P25,000.00 per member. Atty. Tomacruz received a letter from FLAMES, expressing its refusal to make further payments. FLAMES stated that the 15% contingent fee had no actual basis "since no benefit was in fact obtained by the members of FLAMES consequent to the filing of the Motion for intervention." FLAMES added that the amounts already received by Atty. Tomacruz was reasonable compensation for his services and was commensurate to what was actually worked out by him.

Nestle adopted Policy No. HRM 1.8, otherwise known as the Drug Abuse Policy. Pursuant to this policy, the management shall conduct simultaneous drug tests on all employees from different factories and plants. There was resistance to the policy in the Cagayan de Oro factory. Out of 496 employees, only 141 submitted themselves to drug testing. On August 20, 1999, the Union of Nestle Workers Cagayan de Oro Factory wrote Nestle challenging the implementation of the policy and branding it as a mere subterfuge to defeat the employees’ constitutional rights. Nestle claimed that the policy is in keeping with the governments thrust to eradicate the proliferation of drug abuse, explaining that the company has the right: (a) to ensure that its employees are of sound physical and mental health and (b) to terminate the services of an employee who refuses to undergo the drug test. Petitioner filed a complaint for injuction. Respondent filed a MoDi alleging that RTC has no jurisdiction since it is a labor dispute. RTC dismissed the complaint.

Issue: WON the employment contract was valid. Issue: WON the complaint was a labor dispute. Held: No. Held: Yes.

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Magsino Labor Relations Digests, Arbues 2019 Generally speaking, where the employment of an attorney is under an express valid contract fixing the compensation for the attorney, such contract is conclusive as to the amount of compensation.[8]cralaw A stipulation on a lawyer's compensation in a written contract for professional services ordinarily controls the amount of fees that the contracting lawyer may be allowed, unless the court finds such stipulated amount unreasonable or unconscionable. The degree of unconscionability or unreasonableness of a stipulated amount in a contingent fee contract, will not however, preclude recovery. It merely justifies the court's fixing a reasonable amount for the lawyer's services

G.R. No. 76219 May 27, 1991 GTE CORPORATION v HON. AUGUSTO S. SANCHEZ

DIRECTORIES

Facts: GTE prints directories. Increments were given by the so-called "Grid System," grids within each territory usually numbering five. Each grid was assigned a fixed closing dated. At such closing date, a salesperson should have achieved a certain amount of the revenue target designated for his grid; otherwise, he loses the forthcoming grid or forfeits the remaining grids not yet received. The new Sales Evaluation and Production Policy was implemented which was more aggressive than the Grid System. GTE sent memorandum to its sales representatives, requiring submission of "individual reports reflecting target revenues as of grid deadlines. No compliance was made. GTE thereupon suspended its sales representatives. Finally, GTE gave its sales representatives an ultimatum. By memorandum individually addressed to its sales representatives, GTE required them, for the last time, to submit the required reports GTE terminated the employment of the recalcitrant sales representatives.

The contingent fee of P11M is clearly disproportionate to the extent of the services rendered by Atty. Tomacruz, even if we were to take into account the character of his intervention and the quality of his work. Thus, it is incumbent upon us to fix a more reasonable sum which, in relation to the prevailing circumstances, could be deemed as appropriate. In other words, we find here reason to apply the principle of quantum meruit. "Quantum meruit," meaning "as much as he deserves," is used as a basis for determining the lawyer's professional fees in the absence of a contract, but recoverable by him from his client. Recovery of attorney's fees on the basis of quantum meruit is authorized when (1) although there is a contract, the fees stipulated are found unconscionable or unreasonable by the court; (2) the contract for attorney's fees is void due to purely formal defects of execution; (3) counsel, for justifiable cause, was not able to finish the case to its conclusion; and (4) the lawyer and client disregard the contract for attorney's fees.

Issue: WON the termination was valid. Held: Yes. GTE had cause to dismiss the premise sales representatives who had repeatedly and deliberately refused to comply with its directive for submission of individual reports on specified matters. The record shows that GTE addressed 6 written official communications to said premise sales representatives embodying this requirement.

In fixing a reasonable compensation for services rendered by a lawyer on the basis of quantum meruit, the following factors are considered: (1) the time spent and extent of services rendered; (2) the novelty and difficulty of the questions involved; (3) the importance of the subject matter; (4) the skill demanded; (5) the probability of losing other employment as a result of the acceptance of the proffered case; (6) the amount involved in the controversy and the benefits resulting to the client; (7) the certainty of compensation; (8) the character of employment; and (9) the professional standing of the lawyer.

The Labor Minister found nothing to suggest that the employer's unilateral action of inaugurating a new sales scheme "was designed to discourage union organization or diminish its influence;" that on the contrary, it was "part of its overall plan to improve efficiency and economy and at the same time gain profit to the highest. Except as limited by special laws, an employer is free to regulate, according to his own discretion and judgment, all aspects of employment, including hiring, work assignments, working methods, time, place and manner of work, tools to be used, processes to be followed, supervision of workers, working regulations, transfer of employees, work supervision, lay-off of workers and the discipline, dismissal and recall of work.

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Magsino Labor Relations Digests, Arbues 2019 Every business enterprise endeavors to increase its profits. In the process, it may adopt or devise means designed towards that goal. 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.

date the employee started working. On the other hand, Article 280, defined when an employment shall be regular notwithstanding any written agreement to the contrary. In other words, the graduation of an employee from casual or probationary to regular does not depend on the arbitrary will of his employer. If there is any group of employees that needs robust protection from the exploitation of employers, it is the casuals and probationaries.

To sanction disregard or disobedience by employees of a rule or order laid down by management, on the pleaded theory that the rule or order is unreasonable, illegal, or otherwise irregular for one reason or another, would be disastrous to the discipline and order that it is in the interest of both the employer and his employees. G.R. No. 70705 August 21, 1989 G.R. No. 106246 September 1, 1994 CENTRAL ELECTRIC COOPERATIVE (CENECO) v NLRC

NEGROS

MOISES DE LEON v NLRC

Facts: Petitioner was employed by respondent company La Tondeña as maintenance man whose work consisted mainly of painting company building and equipment, and other odd jobs relating to maintenance. After having worked for respondent for more than a year, petitioner requested that he be included in the payroll of regular employees, to which the former responded by dismissing petitioner from his employment. Petitioner having been refused reinstatement filed a complaint before the Labor Arbiter. Petitioner asserts that he is a regular employee performing similar functions as of a regular maintenance and was rehired by respondent company’s labor agency to perform the same tasks. Respondent company meanwhile claims petitioner was a casual worker hired only to paint a certain building in the premises and that his work as painter terminated upon completion of the job. The LA ruled in favor of petitioner but was reversed on appeal by the NLRC tribunal.

Facts: Private respondents are employees of petitioner, an electric cooperative company. They have been in service varying from 10 months to 4.5 years. They were extended permanent appointments only on July 13, 1988, retroactive to June 16, 1988. Petitioner has a CBA with its employees' union for a duration of 3 years from April 1, 1987 up to March 31, 1990. The CBA provides for a wage increase for all permanent. Though they were made permanent in 1988, private respondents demanded payment of the wage increase for the year 1987 as provided by the above collective bargaining agreement. Petitioner denied their demand. Issue: WON the employees were regular employees even prior to 1988.

Issue: WON De Leon was a regular employee. Held: Yes. It cannot be denied that private respondents attained the status of regular employees even before 1988. Firstly, they perform activities which are necessary or desirable in the usual business of the petitioner as an electric cooperative. Indeed, their appointments would not have been regularized if their jobs were not indispensable in the daily operation of the petitioner's business. Secondly, they had worked for petitioner for more than 6 months before they were given regular appointments. They had been hired on various dates starting from 1984.

Held: Yes. Contrary agreements notwithstanding, an employment is deemed regular when the activities performed by the employee are usually necessary or desirable in the usual business or trade of the employer. Not considered regular are the so-called "project employment" the completion or termination of which is more or less determinable at the time of employment, such as those employed in connection with a particular construction project and seasonal employment which by its nature is only desirable for a limited period of time. However, any employee who has rendered at least one year of service, whether continuous or intermittent, is deemed regular with respect to the activity he performed and while such activity actually exists.

Articles 280 and 281 of our Labor Code, put an end to the practice of making permanent casuals of our lowly employees by the simple expedient of extending to them probationary appointments, ad infinitum. Thus, Article 281, placed a ceiling on probationary employment, i.e., not to exceed 6 months from the

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Magsino Labor Relations Digests, Arbues 2019 The primary standard of determining a regular employment is the reasonable connection between the particular activity performed by the employee in relation to the usual business or trade of the employer. The connection can be determined by considering the nature of the work performed and its relation to the scheme of the particular business or trade in its entirety. Also, if the employee has been performing the job for at least one year, even if the performance is not continuous or merely intermittent, the law deems the repeated and continuing need for its performance as sufficient evidence of the necessity if not indispensability of that activity to the business. Hence, the employment is also considered regular, but only with respect to such activity and while such activity exists.

CBA, some members of the bargaining unit formed another union called "Kimberly Independent Labor Union for Solidarity, Activism and Nationalism-Organized Labor Association in Line Industries and Agriculture (KILUSAN-OLALIA). KILUSANOLALIA filed a petition for certification election. KIMBERLY and UKCEUPTGWO did not object to the holding of a certification election but objected to the inclusion of the so-called contractual workers whose employment with KIMBERLY was coursed through an independent contractor, Rank Manpower Company (RANK), as among the qualified voters. During the pre-election conference, 64 casual workers were challenged by KIMBERLY and UKCEU-PTGWO on the ground that they are not employees of KIMBERLY but of RANK. It was agreed by all the parties that the 64 voters shall be allowed to cast their votes but that their ballots shall be segregated and subject to challenge proceedings.

In the case at bar, the respondent company, which is engaged in the business of manufacture and distillery of wines and liquors, claims that petitioner was contracted on a casual basis specifically to paint a certain company building and that its completion rendered petitioner's employment terminated. This may have been true at the beginning, and had it been shown that petitioner's activity was exclusively limited to painting that certain building, respondent company's theory of casual employment would have been worthy of consideration. However, during petitioner's period of employment, the records reveal that the tasks assigned to him included not only painting of company buildings, equipment and tools but also cleaning and oiling machines, even operating a drilling machine, and other odd jobs assigned to him when he had no painting job.

Issue: WON the 64 employees were regular Kimberly employees. Held: Article 280 of the Labor Code provides for two. kinds of regular employees, namely: (1) those who are engaged to perform activities which are usually necessary or desirable in the usual business or trade of the employer; and (2) those who have rendered at least one year of service, whether continuous or broken, with respect to the activity in which they are employed. The individual petitioners herein who have been adjudged to be regular employees fall under the second category. Owing to their length of service with the company, these workers became regular employees, by operation of law, 1 year after they were employed by KIMBERLY through RANK. While the actual regularization of these employees entails the mechanical act of issuing regular appointment papers and compliance with such other operating procedures as may be adopted by the employer, it is more in keeping with the intent and spirit of the law to rule that the status of regular employment attaches to the casual worker on the day immediately after the end of his first year of service. To rule otherwise, and to instead make their regularization dependent on the happening of some contingency or the fulfillment of certain requirements, is to impose a burden on the employee which is not sanctioned by law.

G.R. No. L-77629 May 9, 1990 KIMBERLY INDEPENDENT v Drilon

That the first stated position is the situation contemplated and sanctioned by law is further enhanced by the absence of a statutory limitation before regular status can be acquired by a casual employee. The law is explicit. As long as the employee has rendered at least one year of service, he becomes a regular employee with respect to the activity in which he is employed. The law does not provide the qualification that the employee must first be issued a regular appointment or must first be formally

Facts: Kimberly-Clark Philippines, Inc. (KIMBERLY) executed a three-year collective bargaining agreement (CBA) with United Kimberly-Clark Employees Union-Philippine Transport and General Workers' Organization (UKCEUPTGWO) which expired on June 30,1986. Within the 60-day freedom period prior to the expiration of and during the negotiations for the renewal of the aforementioned

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Magsino Labor Relations Digests, Arbues 2019 declared as such before he can acquire a regular status. Obviously, where the law does not distinguish, no distinction should be drawn G. R. No. 148492. May 9, 2003 BUENAVENTURA C. MAGSALIN NATIONAL ORGANIZATION OF WORKING MEN (N.O.W.M) G.R. No. 91307

January 24, 1991

v

SINGER SEWING v Drilon Facts: The private respondents worked as sales route helpers for the petitioner (Coca Cola) for 5 months and thereafter they were hired on a daily basis. According to the petitioner, the respondents were merely hired as substitutes for regular helpers when the latter were unavailable or due to shortage of manpower/high volume of work. These workers would then wait every morning outside the gates and if hired, they would be paid their wages at the end of the day. The respondents asked the petitioner to make them regular but the latter refused. Hence, 23 of these temporary workers filed a case for illegal dismissal.

Facts: SINGER MACHINE COLLECTORS UNION-BAGUIO (SIMACUB) filed a petition for direct certification as the sole and exclusive bargaining agent of all collectors of the Singer Sewing Machine Company, Baguio City branch. The Company opposed the petition mainly on the ground that the union members are actually not employees but are independent contractors as evidenced by the collection agency agreement which they signed. Union asserted that they "perform the most desirable and necessary activities for the continuous and effective operations of the business of the petitioner Company".

Issue: WON the truck helpers were regular employees. Held: Yes. In determining whether an employment should be considered regular or non-regular, the applicable test is the reasonable connection between the particular activity performed by the employee in relation to the usual business or trade of the employer. The standard, supplied by the law itself, is whether the work undertaken is necessary or desirable in the usual business or trade of the employer, a fact that can be assessed by looking into the nature of the services rendered and its relation to the general scheme under which the business or trade is pursued in the usual course. It is distinguished from a specific undertaking that is divorced from the normal activities required in carrying on the particular business or trade. But, although the work to be performed is only for a specific project or seasonal, where a person thus engaged has been performing the job for at least one year, even if the performance is not continuous or is merely intermittent, the law deems the repeated and continuing need for its performance as being sufficient to indicate the necessity or desirability of that activity to the business or trade of the employer. The employment of such person is also then deemed to be regular with respect to such activity and while such activity exists.

Issue: WON the collecting agents are employees of the company. Held: No. The nature of the relationship between a company and its collecting agents depends on the circumstances of each particular relationship. Not all collecting agents are employees and neither are all collecting agents independent contractors. The plain language of the agreement reveals that the designation as collection agent does not create an employment relationship and that the applicant is to be considered at all times as an independent contractor. This is consistent with the first rule of interpretation that the literal meaning of the stipulations in the contract controls. No such words as "to hire and employ" are present. Moreover, the agreement did not fix an amount for wages nor the required working hours. Compensation is earned only on the basis of the tangible results produced, i.e., total collections made.

The argument of petitioner that its usual business or trade is softdrink manufacturing and that the work assigned to respondent workers as sales route helpers so involves merely postproduction activities, one which is not indispensable in the manufacture of its products, scarcely can be persuasive. If, as so argued by petitioner company, only those whose work are directly involved in the production of softdrinks may be held performing functions necessary and desirable in its usual business or trade, there would have then been no need for it to even maintain regular truck sales route helpers. The nature of the work performed must be viewed from a perspective of the business or trade in its entirety and not on a confined scope. The repeated rehiring of respondent workers and the continuing need for their services clearly attest to the necessity or desirability of their services in the regular conduct of the business or trade of petitioner company.

The Court finds that since private respondents are not employees of the Company, they are not entitled to the constitutional right to join or form a labor organization for purposes of collective bargaining. Accordingly, there is no constitutional and legal basis for their "union" to be granted their petition for direct certification.

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Magsino Labor Relations Digests, Arbues 2019 G.R. No. L-46562 March 31, 1978 VASSAR INDUSTRIES EMPLOYEES UNION (VIEU) v HON. FRANCISCO L. ESTRELLA

Facts: Benjamin Victoriano (hereinafter referred to as Appellee), a member of INC, had been in the employ of the Elizalde Rope Factory, Inc. (hereinafter referred to as Company) since 1958. As such employee, he was a member of the Elizalde Rope Workers' Union (hereinafter referred to as Union) which had with the Company a CBA containing a closed shop provision which reads as:

Facts: There was in existence a CBA between private respondents Associated Labor Unions and Vassar Industries. Prior to its expiration, 111 of a total number of 150 employees of such firm disaffiliated from the former labor organization and formed their own union. Thereafter, they filed an application for registration of their union with the Bureau of Labor Relations, complying with an the requirements of both the Labor Code and its implementing regulations. While such application was pending, petitioner Union filed a petition for certification as bargaining agent for the rank-and-file employees of the company. The Med-Arbiter denied their plea on the ground that the union was not duly registered with the Department of Labor.

Membership in the Union shall be required as a condition of employment for all permanent employees workers covered by this Agreement. Under Section 4(a), paragraph 4, of RA 875, prior to its amendment by RA 3350, the employer was not precluded "from making an agreement with a labor organization to require as a condition of employment membership therein, if such labor organization is the representative of the employees." On June 18, 1961, however, RA 3350 was enacted, introducing an amendment to — paragraph (4) subsection (a) of section 4 of Republic Act No. 875, as follows: "but such agreement shall not cover members of any religious sects which prohibit affiliation of their members in any such labor organization".

The Bureau of Labor Relations denied the application for registration on the ground that there is a registered collective bargaining agent in the company. Issue: WON BLR may deny the registration. Held: No. There is both a constitutional and statutory recognition that laborers have the right to form unions to take care of their interests vis-a-viz their employees. Their freedom to form organizations would be rendered nugatory if they could not choose their own leaders to speak on their behalf and to bargain for them." The freedom to choose which labor organization to join is an aspect of the constitutional mandate of protection to labor. Mandamus lies to compel the registration of a labor organization. To allow a labor union to organize itself and acquire a personality distinct and separate from its members and to serve as an instrumentality to conclude CBA, the role of a labor union as the agency for the expression of the collective will affecting its members both present and prospective, was stressed.

Being a member of a religious sect that prohibits the affiliation of its members with any labor organization, Appellee presented his resignation to appellant Union in 1962, and when no action was taken thereon, he reiterated his resignation on September 3, 1974. Thereupon, the Union wrote a formal letter to the Company asking the latter to separate Appellee from the service in view of the fact that he was resigning from the Union as a member. The management of the Company in turn notified Appellee and his counsel that unless the Appellee could achieve a satisfactory arrangement with the Union, the Company would be constrained to dismiss him from the service. This prompted Appellee to file an action for injunction to enjoin the Company and the Union from dismissing Appellee. In its answer, the Union invoked the "union security clause" of the CBA; assailed the constitutionality RA 3350.

Employees shall have the right to self-organization and to form, join or assist labor organizations of their own choosing for the purpose of collective bargaining through representatives of their own choosing and to engage in concerted activities for the purpose of collective bargaining and other mutual aid or protection." The Labor Code is equally explicit on the matter. Thus: "The State shall assure the rights of workers to self-organization, collective bargaining, security of tenure and just and humane conditions of work." G.R. No. L-25246 September 12, 1974 BENJAMIN VICTORIANO v ELIZALDE ROPE WORKERS' UNION

Issue: WON RA 3350 is unconstitutional Held: No. Section 3 of RA 875 provides that employees shall have the right to selforganization and to form, join of assist labor organizations of their own choosing for the purpose of collective bargaining and to engage in concerted activities for the purpose of collective bargaining and other mutual aid or protection. What the Constitution and the Industrial Peace Act recognize and guarantee is the "right" to form or join associations.

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Magsino Labor Relations Digests, Arbues 2019 Universal Robina Corp, with a 3-yr collective bargaining agreement which was to expire on November 15, 1987 Within the freedom period of 60 days prior to the expiration of its CBA, TUPAS filed an amended notice of strike as a means of pressuring the company to extend, renew, or negotiate a new CBA with it.

The right to refrain from joining labor organizations recognized by Section 3 of the Industrial Peace Act is, however, limited. The legal protection granted to such right to refrain from joining is withdrawn by operation of law, where a labor union and an employer have agreed on a closed shop, by virtue of which the employer may employ only member of the collective bargaining union, and the employees must continue to be members of the union for the duration of the contract in order to keep their jobs. To that all-embracing coverage of the closed shop arrangement, RA 3350 introduced an exception, when it added to Section 4 of the Industrial Peace Act the following proviso: "but such agreement shall not cover members of any religious sects which prohibit affiliation of their members in any such labor organization". RA 3350 merely excludes ipso jure from the application and coverage of the closed shop agreement the employees belonging to any religious sects which prohibit affiliation of their members with any labor organization. What the exception provides, therefore, is that members of said religious sects cannot be compelled or coerced to join labor unions even when said unions have closed shop agreements with the employers; that in spite of any closed shop agreement, members of said religious sects cannot be refused employment or dismissed from their jobs on the sole ground that they are not members of the collective bargaining union. The free exercise of religious profession or belief is superior to contract rights. In case of conflict, the latter must, therefore, yield to the former.

The NEW ULO (composed mostly of workers belonging to the INC sect) registered as a labor union. TUPAS staged a strike ROBINA obtained an injunction against the strike, resulting in an agreement to return to work and for the parties to negotiate a new CBA. The NEW ULO filed a petition for a certification election at the BLR TUPAS moved to dismiss the petition for being defective in form and the members of the NEW ULO were mostly members of INC sect which 3 yrs previous refused to affiliate with any labor union and accused company of using the NEW ULO to defeat TUPAS’ bargaining rights Med-Arbiter ordered the holding of a certification election with 20 days. TUPAS appealed to BLR; In the meantime, it was able to negotiate a new 3-yr CBA with ROBINA, which was signed on December 3, 1987 and to expire on November 15, 1990 BLR Director Calleja dismissed the appeal. TUPAS’ MR was denied. Hence, this petition alleging that BLR acted in excess of her jurisdiction and with grave abuse of discretion in affirming the Med-Arbiter’s order for a certification election.

The primary effects of the exemption from closed shop agreements in favor of members of religious sects that prohibit their members from affiliating with a labor organization, is the protection of said employees against the aggregate force of the CBA, and relieving certain citizens of a burden on their religious beliefs; and by eliminating to a certain extent economic insecurity due to unemployment, which is a serious menace to the welfare of the people. It is our view that the exemption from the effects of closed shop agreement does not directly advance, or diminish, the interests of any particular religion. The benefit upon the religious sects is merely incidental and indirect. The "establishment clause" (of religion) does not ban regulation on conduct whose reason or effect merely happens to coincide or harmonize with the tenets of some or all religions. The free exercise clause of the Constitution has been interpreted to require that religious exercise be preferentially aided. G.R. No. 82914 June 20, 1988 KAPATIRAN SA MEAT AND CANNING v BLR DIRECTOR PURA FERRER CALLEJA

Issue: WON the right of members of the INC sect not to join a labor union for being contrary to their religious beliefs bar the members of that sect from forming their own union. Held: No. The public respondent correctly observed that the "recognition of the tenets of the sect ... should not infringe on the basic right of self-organization granted by the constitution to workers, regardless of religious affiliation."

G.R. No. 131235. November 16, 1999 UST FACULTY UNION (USTFU) v ERNESTO R. BITONIO Facts:

Facts:

Private respondent Mariño et al are duly elected officer of UST faculty. The union has a 5-year CBA with its employer and is set to expire on May 31,1998. On September 21, 1996, Sec Gen of the union posted a general assembly announcement

1984-1987: TUPAS (Kapatiran) was the sole and exclusive collective bargaining representative of the workers in the Meat and Canning Division of the

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Magsino Labor Relations Digests, Arbues 2019 to be held on October 5, 1996. Various UST club presidents requested a general faculty assembly thus union and non-union faculty members convened. New set of officers were elected, violative of the CBL and that GA was held with the attendance of non-union members. Current union officers were served with a notice to vacate the union office as new set of offices were already elected. CBA was likewise ratified by an overwhelming majority. Mad-Arbiter declared the election conducted was violative of the union’s CBL. BLR Director Bitonio upheld the decision with a ruling that the CBL which constituted the covenant between the union and its members, could not be suspended during the general assembly of all faculty members, since it had not been authorized by the union.

A union election is held pursuant to the union’s constitution and bylaws, and the right to vote in it is enjoyed only by union members. A union election should be distinguished from a certification election, which is the process of determining, through secret ballot, the sole and exclusive bargaining agent of the employees in the appropriate bargaining unit, for purposes of collective bargaining. Specifically, the purpose of a certification election is to ascertain whether or not a majority of the employees wish to be represented by a labor organization and, in the affirmative case, by which particular labor organization. In a certification election, all employees belonging to the appropriate bargaining unit can vote. Therefore, a union member who likewise belongs to the appropriate bargaining unit is entitled to vote in said election. However, the reverse is not always true; an employee belonging to the appropriate bargaining unit but who is not a member of the union cannot vote in the union election, unless otherwise authorized by the constitution and bylaws of the union. Verily, union affairs and elections cannot be decided in a non-union activity.

Issue: WON public respondent committed grave abuse of discretion in refusing to recognize the officers elected during the October 4, 1996 general assembly. Held: No. We cannot attribute grave abuse of discretion to Director Bitonios finding and conclusion. We invalidated the local union elections held at the wrong date without prior notice to members and conducted without regard for duly prescribed ground rules. We held that the proceedings were rendered void by the lack of due process -- undue haste, lack of adequate safeguards to ensure integrity of the voting, and the absence of the notice of the dates of balloting.

In both elections, there are procedures to be followed. Thus, the October 4, 1996 election cannot properly be called a union election, because the procedure laid down in the USTFUs CBL for the election of officers was not followed. It could not have been a certification election either, because representation was not the issue, and the proper procedure for such election was not followed. The participation of non-union members in the election aggravated its irregularity.

Self-organization is a fundamental right guaranteed by the Constitution and the Labor Code.Corollary to this right is the prerogative not to join, affiliate with or assist a labor union. Therefore, to become a union member, an employee must, as a rule, not only signify the intent to become one, but also take some positive steps to realize that intent. On joining a labor union, the constitution and by-laws become a part of the members contract of membership under which he agrees to become bound by the constitution and governing rules of the union so far as it is not inconsistent with controlling principles of law. The constitution and by-laws of an unincorporated trade union express the terms of a contract, which define the privileges and rights secured to, and duties assumed by, those who have become members. The agreement of a member on joining a union to abide by its laws and comply with the will of the lawfully constituted majority does not require a member to submit to the determination of the union any question involving his personal rights.

G.R. No. L-43495-99 January 20, 1990 TROPICAL EMPLOYEES' UNION-CGW v TROPICAL HUT FOOD MARKET

HUT

Facts: The rank and file workers of the Tropical Hut Food organized a local union called the Tropical Hut Employees Union (THEU), elected their officers, adopted their constitution and by-laws and immediately sought affiliation with the National Association of Trade Unions (NATU). The NATU accepted the THEU application for affiliation. Following such affiliation with NATU, Registration Certificate was issued by the DOLE in the name of the Tropical Hut Employees Union — NATU. It appears, however, that NATU itself as a labor federation, was not registered with the Department of Labor.

*Union Election vs Certification Election

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Magsino Labor Relations Digests, Arbues 2019 PSEA subsequently affiliated itself with the National Congress of Workers (NCW), changed its name to Philippine Skylanders Employees Association National Congress of Workers (PSEA-NCW), and to maintain continuity within the organization, allowed the former officers of PSEA-PAFLU to continue occupying their positions as elected officers in the newly-forged PSEA-NCW.

Company and THEU-NATU entered into a new CBA which incorporated the previous union-shop security clause and the attached check-off authorization form. NATU received a letter jointly signed by the incumbent officers of the local union informing the NATU that THEU was disaffiliating from the NATU federation. On despite being given the chance to affirm their membership with THEU-NATU, they did not. The union security clause set forth in the CBA was enforced which says membership is a condition of continued employment. And they were dismissed.

17 March 1994 PSEA-NCW entered into a collective bargaining agreement with PSI which was immediately registered with the Department of Labor and Employment. PAFLU requested for the accounting. PSI through its personnel manager Francisco Dakila denied the request.

Issue: WON disaffiliation is a violation of union security clause and be the basis of the dismissal of the employees.

PAFLU through Serafin Ayroso filed a complaint for unfair labor practice against PSI, its president Mariles Romulo and personnel manager Francisco Dakila. PAFLU alleged that aside from PSI’s refusal to bargain collectively with its workers, the company through its president and personnel manager, was also liable for interfering with its employees’ union activities

Held: No. The union security clause embodied in the CBA cannot be used to justify the dismissals meted to petitioners since it is not applicable to the circumstances obtaining in this case. The CBA imposes dismissal only in case an employee is expelled from the union for joining another federation or for forming another union or who fails or refuses to maintain membership therein. The case at bar does not involve the withdrawal of merely some employees from the union but of the whole THEU itself from its federation. Clearly, since there is no violation of the union security provision in the CBA, there was no sufficient ground to terminate the employment of said employees.

Ayroso filed another complaint in behalf of PAFLU for unfair labor practice against Francisco Dakila. Through Ayroso PAFLU claimed that Dakila was present in PSEA’s organizational meeting thereby confirming his illicit participation in union activities. Ayroso added that the members of the local union had unwittingly fallen into the manipulative machinations of PSI and were lured into endorsing a collective bargaining agreement which was detrimental to their interests.

In view of the fact that the dispute revolved around the mother federation and its local, with the company suspending and dismissing the workers at the instance of the mother federation then, the company’s liability should be limited to the immediate reinstatement of the workers. And since their dismissals were effected without previous hearing and at the instance of NATU, this federation should be held liable to the petitioners for the payment of their backwages, as what We have ruled in the Liberty Cotton Mills Case. G.R. No. 127374. January 31, 2002 PHILIPPINE SKYLANDERS v NLRC

PAFLU amended its complaint by including the elected officers of PSEA-PAFLU as additional party respondents. PAFLU averred that the local officers of PSEAPAFLU, namely Macario Cabanias, Pepito Rodillas, Sharon Castillo, Danilo Carbonel, Manuel Eda, Rolando Felix, Jocelyn Fronda, Ricardo Lumba, Joseph Mirasol, Nerisa Mortel, Teofilo Quirong, Leonardo Reyes, Manuel Cadiente, and Herminia Riosa, were equally guilty of unfair labor practice since they brazenly allowed themselves to be manipulated and influenced by petitioner Francisco Dakila.

Facts: In November 1993 the Philippine Skylanders Employees Association (PSEA-NWC), a local labor union affiliated with the Philippine Association of Free Labor Unions (PAFLU), won in the certification election conducted among the rank and file employees of Philippine Skylanders, Inc. (PSI). Its rival union, Philippine Skylanders Employees Association-WATU (PSEA-WATU) immediately protested the result of the election before the Secretary of Labor. PSEA-NWC sent PAFLU a notice of disaffiliation citing as reason PAFLU's supposed deliberate and habitual dereliction of duty toward its members.

Dakila moved for the dismissal of the complaint on the ground that the issue of disaffiliation was an inter-union conflict which lay beyond the jurisdiction of the Labor Arbiter. PSEA was no longer affiliated with PAFLU, Ayroso or PAFLU for that matter had no personality to file the instant complaint. Labor Arbiter declared PSEA’s disaffiliation from PAFLU invalid and held PSI, PSEA-PAFLU and their respective officers guilty of unfair labor practice.

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Magsino Labor Relations Digests, Arbues 2019 As PSEA-NCW’s personality was not accorded recognition, its collective bargaining agreement with PSI was struck down for being invalid. PSI, PSEA and their respective officers appealed to the NLRC. But the NLRC upheld the Decision ofthe Labor Arbiter.

G.R. No. L-50992 June 19, 1985 NATIVIDAD SAMPANG vs HONORABLE AMADO G. INCIONG

Held: Right of local unions to separate from their mother federation on the ground that as separate and voluntary associations, local unions do not owe their creation and existence to the national federation to which they areaffiliated but, instead, to the will of their members. The sole essence of affiliation is to increase, by collective action, the common bargaining power of local unions for the effective enhancement and protection of their interests. Admittedly, there aretimes when without succor and support local unions may find it hard, unaided by other support groups, to secure justice for themselves. Yet the local unions remain the basic units of association, free to serve their own interests subject to the restraints imposed by the constitution and by-laws of the national federation, and free also to renounce the affiliation upon the terms laid down in the agreement which brought such affiliation into existence.

Facts:

Nothing shown in the records nor is it claimed by PAFLU that the local union was expressly forbidden to disaffiliate from the federation nor were there any conditions imposed for a valid breakaway. As such, the pendency of an election protest involving both the mother federation and the local union did not constitute a bar to a valid disaffiliation. Neither was it disputed by PAFLU that 111 signatories out of the 120 members of the local union, or an equivalent of 92.5% of the total union membership supported the claim of disaffiliation and had in fact disauthorized PAFLU from instituting any complaint in their behalf.

Issue: WON Sampang’s dismissal violated the security of tenure.

Sampang seeks the reversal of an order of the then Deputy Minister of Labor Inciong, who sustained the RD in his decision to grant clearance for her dismissal, presumably for initiating "a concerted action among the rank and file workers not to perform overtime work amounting to gross insubordination" That charge she denied, her version being that she made "several representations with management, upon request of the members of the union, to cut-off overtime work, as this would mean more days of work and additional living allowance for the workers, but to no avail, that the overtime work was a device of management to avoid compliance with P.D. 112; that there is no exigency for the rendering of overtime work, hence, the concerted refusal to work overtime cannot be recalled a strike."

Held: Yes. There is here a case, therefore, of an employee, with more than thirty years service, having been dismissed for instigating a strike that lasted for two days and caused the loss in the amount of P2,716.00. It is quite obvious then that the constitutional mandate on security of tenure was violated. For even if her denial that she did not instigate such two-day strike be disregarded, still the penalty imposed was grossly disproportionate to the offense imputed to her.

It was entirely reasonable then for PSI to enter into a collective bargaining agreement with PSEA-NCW. As PSEA had validly severed itself from PAFLU, there would be no restrictions which could validly hinder it from subsequently affiliating with NCW and entering into a collective bargaining agreement in behalf of its members. The mere act of disaffiliation did not divest PSEA of its own personality; neither did it give PAFLU the license to act independently of the local union.

It would imply at the very least that where a penalty less punitive would suffice, whatever missteps may be committed by labor ought not to be visited with a consequence so severe. It is not only because of the law's concern for the workingman. There is, in addition, his family to consider. Unemployment brings untold hardships and sorrows on those dependent on the wage-earner. The misery and pain attendant on the loss of jobs then could be avoided if there be acceptance of the view that under all the circumstances of this case, petitioners should not be deprived of their means of livelihood. Nor is this to condone what had been done by them. For all this while, since private respondent considered them separated from the service, they had not been paid. From the strictly juridical standpoint, it cannot be too strongly stressed, to follow Davis in his masterly work, Discretionary Justice, that where a decision may be made to rest on informed judgment rather than rigid rules, all the equities of the case must be accorded their due weight. Finally, labor

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Magsino Labor Relations Digests, Arbues 2019 law determinations, to quote from Bultmann, should be not only secundum rationem but also secundum caritatem.

Petitioners insist that their disaffiliation from PAFLU and filing a petition for certification election are not acts of disloyalty but an exercise of their right to self-organization. They contend that these acts were done within the 60-day freedom period when questions of representation may freely be raised. Under the peculiar facts of the case, We find petitioners' insistence untenable.

G.R. No. L-50283-84 April 20, 1983 DOLORES VILLAR v DEPUTY MINISTER INCIONG

A closed-shop is a valid form of union security, and a provision therefor in a collective bargaining agreement is not a restriction of the right of freedom of association guaranteed by the Constitution. Where in a closed-shop agreement it is stipulated that union members who cease to be in good standing shall immediately be dismissed, such dismissal does not constitute an unfair labor practice exclusively cognizable by the CIR.

Facts: Petitioners were members of the Amigo Employees Union-PAFLU, and the existing bargaining agent of the employees in private respondent Amigo Manufacturing (hereinafter referred to as Company). The Company and the Amigo Employees Union-PAFLU had a CBA governing their labor relations, which agreement was then about to expire on February 28, 1977. Within the last 60 days of the CBA, events transpired giving rise to the present dispute.

Extant from the records is the fact that petitioners numbering 10, were among the 96 who signed the "Sama-Samang Kapasiyahan" whereas there are 234 union members in the Amigo Employees Union-PAFLU. Hence, petitioners constituted a small minority for which reason they could not have successfully disaffiliated the local union from PAFLU. Since only 96 wanted disaffiliation, it can be inferred that the majority wanted the union to remain an affiliate of PAFLU and this is not denied or disputed by petitioners. The action of the majority must, therefore, prevail over that of the minority members.

On January 5, 1977, upon written authority of at least 30% of the employees in the company, including the petitioners, the Federation of Unions of Rizal (referred to as FUR) filed a petition for certification election with the Med-Arbiter. The petition was opposed by PAFLU. Thereafter, employees who signed with PAFLU signed a resolution stating their withdrawal from PAFLU and authorizing FUR to be their sole bargaining agent. Invoking the security clause in the CBA, PAFLU demanded the dismissal of the members of fur, which the company granted. Issue: WON the right to self-organization has been impaired. Held: No. It is true that disaffiliation from a labor union is not open to legal objection. It is implicit in the freedom of association ordained by the Constitution. But this Court has laid down the ruling that a closed shop is a valid form of union security, and such provision in a collective bargaining agreement is not a restriction of the right of freedom of association guaranteed by the Constitution. The quoted stipulation for closed-shop is clear and unequivocal and it leaves no room for doubt that the employer is bound, under the collective bargaining agreement, to dismiss the employees, herein petitioners, for non- union membership. Petitioners became nonunion.

G.R. No. L-22228 February 27, 1969 PAFLU, SOCIAL SECURITY SYSTEM EMPLOYEES ASSOCIATIONPAFLU v SECRETARY OF LABOR Facts: The Registration of Labor Organizations — hereinafter referred to as the Registrar — issued a notice of hearing of the matter of cancellation of the registration of the SSSEA, because of failure to furnish the BLR with copies of the reports on the finances of that union duly verified by affidavits, in violation of Section 23 of Republic Act No. 875. After hearing, the certification was cancelled.

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Magsino Labor Relations Digests, Arbues 2019 UNITED SEAMEN v DAVAO SHIPOWNER Petitioners pray for writs of certiorari and prohibition to restrain respondents, the Secretary of Labor, the Director of Labor Relations and the Registrar of Labor Organizations, from enforcing an order of cancellation of the registration certificate of the Social Security System Employees Association — hereinafter referred to as the SSSEA — which is affiliated to the Philippine Association of Free Labor Unions — hereinafter referred to as PAFLU — as well as to annul all proceedings in connection with said cancellation and to prohibit respondents from enforcing Section 23 of RA 875.

Facts: On August 4, 1959, USUP presented a set of demand to DSA, representing the respondent shipping companies, for union recognition, union security, standardization of wages and other benefits. In response, the ship owners brought to the attention of the USUP the existence of a CBA with the Davao Marine Association (DMA), where all of the crewmen of their launches belonged. They suggested to the USUP that they first take the necessary steps for certification as the collective bargaining agent, as the ship owners were bound by the CBA until 1959. However, even before receiving the ship owner’s response to its demands, the USUP had filed a Notice of Strike against the individual ship owners at the Department of Labor Davao Office.

Issue: WON section 23 violates freedom of assembly and association. Held: No. The registration prescribed in paragraph (b) of said section is not a limitation to the right of assembly or association, which may be exercised with or without said registration. The latter is merely a condition sine qua non for the acquisition of legal personality by labor organizations, associations or unions and the possession of the "rights and privileges granted by law to legitimate labor organizations". The Constitution does not guarantee these rights and privileges, much less said personality, which are mere statutory creations, for the possession and exercise of which registration is required to protect both labor and the public against abuses, fraud, or impostors who pose as organizers, although not truly accredited agents of the union they purport to represent. Such requirement is a valid exercise of the police power, because the activities in which labor organizations, associations and union of workers are engaged affect public interest, which should be protected. Furthermore, the obligation to submit financial statements, as a condition for the non-cancellation of a certificate of registration, is a reasonable regulation for the benefit of the members of the organization, considering that the same generally solicits funds or membership, as well as oftentimes collects, on behalf of its members, huge amounts of money due to them or to the organization.

The Chief of the Labor Operations Section of the Davao Office requested for a conference to solve the conflict. On August 20, 1959, both parties reached a covenant stating the withdrawal of the Notice of Strike, as well as the observance of the status quo regarding the jobs incident to the businesses of the DSA and the withdrawal of the civil case of the DMA against the USUP. It was also stipulated in the contract that the USUP will respect the existing CBA between DSA and DMA, but USUP will file a petition for certification election for determination of union representation. As stipulated, the USUP filed with the CIR a petition for certification election. Subsequent to the covenant, the shipping companies separately served notices of termination upon 64 employees, effecting December 31, 1959, due to different reasons (from stoppage of operations to the death of one of the partners of the shipping companies due to business losses). As a result, USUP reported the terminations to the Department of Labor, which called for a conference. Nevertheless, on December 29, 1959, the USUP notified the Philippine Constabulary, City Mayor, Bureau of Customs and the general public of a strike on January 1, 1960.

Sec. 23 does not impinge upon the right of organization guaranteed in the Declaration of Human Rights, or run counter to Art. 2, 4, 7, which provide that "workers and employers shall have the right to establish and join organizations of their own choosing, without previous authorization"; that "workers and employers organizations shall not be liable to be dissolved or suspended by administrative authority"; that "the acquisition of legal personality by workers' and employers' organizations, shall not be made subject to conditions of such a character as to restrict the application of the provisions" above mentioned; and that "the guarantees provided for in" said Convention shall not be impaired by the law of the land. G.R. Nos. L-18778 and L-18779 August 31, 1967

On February 11, 1960, the shipping companies filed a petition for writ of injunction, as a necessity due to irreparable damage to properties due to “coercion, violence and illegal picketing”. On the other hand, on February 24, 1960, the USUP filed a ULP case against the ship owners and DSA, alleging that the ship owners interfered, and continued to interfere with their right to self-organization by discrimination against employees. CIR however sided with the DSA, dismissing the USUP’s ULP case while declaring the strike as illegal. Issue: WON the strike was legal.

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Magsino Labor Relations Digests, Arbues 2019 Held: No. The Supreme Court agreed with the lower court’s findings that the USUP’s Notice of Strike was but a direct offshoot of the “losing effort” to compel the DSA and the ship owners to recognize USUP as the sole collective bargaining agent of the employees, to the exclusion of the DMA as the existing collective bargaining agent of the DSA.

Petitioner filed various complaints against UPang in NLRC Dagupan, mostly for non-payment of allowances. The complaints were dismissed. Petitioner's contention that the cases filed by Consuelo Abad as its president should affect, not only herself, but all the other union members similarly situated as she was, is well taken. The uncontroverted allegation of the petitioner is that it is the holder of Registration Certificate No. 9865-C, having been registered with the then Ministry of Labor and Employment on February 16, 1978. As such, petitioner possessed the legal personality to sue and be sued under its registered name. Corollarily, its president, Consuelo Abad, correctly filed the complaints even if some of them involved rights and interest purely or exclusively appertaining to individual employees, it appearing that she signed the complaints "for and in behalf of the University of Pangasinan Faculty Union."

First, the Court noted that the USUP filed its Notice of Strike even before its receipt of the ship owner’s answers to its set of demands, thereby showing that the USUP was already set on continuing the strike with or without the answer of the ship owners. This, according to the Court was a clear showing that USUP was aware of the existence of DMA as a valid collective bargaining agent, operating as a legal bar to entertaining USUP’s demands. Second, the Court stated that USUP completely disturbed the status quo – the return to normal and original operating practices through the strike that was done by USUP. By striking, USUP impaired existing CBA between the shipowners and the DMA which recognized "the right of the Employer to hire, promote and transfer and for legal cause suspend, lay-off or discharge employees subject to the right of the union (referring to the DMA) to notification and to ask reconsideration of any action of the Employer in the premises."

The University's contention that petitioner had no legal personality to institute and prosecute money claims must, therefore, fail. What should be borne in mind is that the interest of the individual worker can be better protected on the whole by a strong union aware of its moral and legal obligations to represent the rank and file faithfully and secure for them the best wages and working terms and conditions. . . . Although this was stated within the context of collective bargaining, it applies equally well to cases, such as the present wherein the union, through its president, presented its individual members' grievances through proper proceedings. While the complaints might not have disclosed the identities of the individual employees claiming monetary benefits, such technical defect should not be taken against the claimants, especially because the University appears to have failed to demand a bill of particulars during the proceedings before the Labor Arbiter.

It could not also be said that the DSA violated the covenant of August 20, 1959, as it was stated that the DSA was not a party thereto. Even assuming that the shipping companies were bound by the covenant, the termination of the employees was not considered to be a violation of the covenant, as the dismissals were predicated on legitimate reasons.

On the merits of the petition, the NLRC did not abuse its discretion in resolving the appeal from the decision of Executive Labor Arbiter Tumang except for the disallowance of the emergency cost of living allowance to members of the petitioner.

Third, the existence of the CBA should have deterred USUP from acts tending to force its recognition as a union. The employees concerned were bound by the CBA between DMA and the ship owners, but instead of going through the procedure as stated in their CBA for grievance machinery. Fourth, it was stated by the Court that, even granting that the purpose of the strike was valid, the fact still remained that the means employed by the employees on strike were far from legitimate, as shown by the fact that the USUP used acts of violence and coercion.

GR No. L-30241 June 30,1972 MACTAN WORKERS UNION VS ABOITIZ 47 SCRA 517

G.R. Nos. 64821-23 January 29, 1993 UNIVERSITY OF PANGASINAN FACULTY UNION v NLRC

FACTS:

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Magsino Labor Relations Digests, Arbues 2019 Defendant Cebu Shipyard & Engineering Works, Inc. in Lapulapu City is employing laborers and employees belonging to two rival labor unions. Namely plaintiff, Mactan Workers Union(MWU) and intervenor appellant Associated Labor Union (ALU). On November 28, 1964, the defendant Cebu Shipyard & Engineering Works, Inc. and the Associated Labor Union entered into a ‘Collective Bargaining Agreement which mandate a profit sharing bonus of 10% of its net income derived from the direct operation of its shipyard and shop in LapuLapu City for its labourers and workers. The profit sharing bonus shall be paid by the company to ALU of which ALU will deliver it to the employees. Unclaimed bonuses shall be returned to the management. The delivery should be in 2 instalments, 1st payable in March and the 2nd payable in June every year.

movement itself, which may well be the recipient of a crippling blow. Moreover, while it is equally understandable that their counsel would take advantage of every legal doctrine deemed applicable or conjure up any defense that could serve their cause, still, as officers of the court, there should be an awareness that resort to such a technique does result in clogged dockets, without the least justification especially so if there be insistence on flimsy and insubstantial contentions just to give some semblance of plausibility to their pleadings. Certainly, technical virtuosity, or what passes for it, is no substitute for an earnest and sincere desire to assure that there be justice according to law. That is a creed to which all members of the legal profession, labor lawyers not excluded, should do their best to live by.

In 1965, the 2nd instalment given in June were not received by members of the rival Mactan Workers Union (MWU) because they did not went to the ALU office to receive their shares. After the 60 day period has lapse, ALU returned the funds to the management with an advice to management to refrain from delivering the amount to the members of MWU without a court order otherwise ALU will take steps to protect the interests of its members. Because of the warning from ALU, the company deposited the amount of P4,035.82 with the Labor Administrator. The MWU filed a case with the lower court to recover the amount.

G.R. No. 96189 July 14, 1992

UP v HON. PURA FERRER-CALLEJA

The Organization of Non-Academic Personnel of UP (ONAPUP) filed a petition for certification election with Bureau of Legal Relations (BLR). It claimed to represent 33% of all the non-academic personnel of UP-Diliman, Los Baños, Manila, and Visayas. The University made no objections thererto, but the All UP Workers’ Union opposed the same and asked that the appropriate organizational unistructure be first defined. It alleged that its membership composed of both academic and nonacademic rank-and-file (RnF) employees (EEs) of UP. The University then made a comment on such that there should indeed be 2 distinct unions, one for academic EEs and the other for the non-academic EEs, considering their dichotomy of interests. Director Calleja however declared that the appropriate bargaining unit should comprise of both groups, stating that the intent of EO 180 was to not fragmentalize the employer (ER) unit. The University also sought to exclude from the bargaining unit EEs holding supervisory positions, alleging that there still existed that held supervisory powers over her other EEs. Director Calleja upheld her earlier ruling, interposing that the policy-making powers contemplated in the case merely pertained to academic matters and not as under the Labor Code. UP’s Motion for reconsideration was likewise denied, hence this petition for certiorari.

The lower court ordered the company to deliver the sum of money to ALU and for ALU to pay the members of MWU their corresponding shares. Hence, the appeal of intervenor ALU. ISSUE: WON Intervenor ALU only represent its members and not the entire workforce of Defendant company HELD: Petition dismissed. The Labor Union that gets the majority vote as the exclusive bargaining representative does not act for its members alone. It represents all the employees in such a bargaining unit. It is not to be forgotten that what is entitled to constitutional protection is labor, more specifically the workers, not labor organizations. That is the Raison D’etere of labor unions. Nevertheless, it is not to be forgotten that what is entitled to constitutional protection is labor, or more specifically the working men and women, not labor organizations. The latter are merely the instrumentalities through which their welfare may be promoted and fostered. That is the raison d’etre of labor unions. The utmost care should be taken then, lest in displaying an unyielding, intransigent attitude on behalf of their members, injustice be committed against opposing labor organizations. In the final analysis, they alone are not the sole victims, but the labor

ISSUE: WON academic and non-academic EEs of UP should comprise a single collective bargaining unit.

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Magsino Labor Relations Digests, Arbues 2019 HELD: No. Although the country’s labor laws fail to provide a criterion for determining the proper bargaining unit, even EO No. 180 only stated that the appropriate organizational unit. A “bargaining unit” has been defined as a group of employees, consistent with equity to the ER, cases have shown the 4 criterion to consider;(1) will of the employees; (2) affinity and unit of employees' interest, such as substantial similarity of work and duties, or similarity of compensation and working conditions; (3) prior collective bargaining history; and (4) employment status, such as temporary, seasonal probationary employees. Out of the four, it is the “community/mutuality of interests” test that stands out the most. Applying the same, it's clear that the acad and non-academic personnel’s respective interests contradict with each other, and in effect, failed to satisfy the “community/mutuality of interest test.” Contrarily, the 2 obviously share a dichotomy of interest or dissimilarity in the work. Thus, the 2 separate and distinct bargaining units, one unit is for academics and the other for non-academic unit personnel, is essential to assure it to all the EEsthe exercise of their collective bargaining rights.

P previously certified as SEBA of EEs & laborers of PNR’s mechanical department Negotiated two bargaining agreements with management (1961, 1963) Renewal had been negotiated, contract remained to be signed Caloocan shops unit was not established nor separated from the Mechanical Department unit R composed mainly of supervisors who had filed pending case to be declared non-supervisors Purpose of petition was to disturb present smooth working labor management relations CIR found that R was composed of workers exclusively at Caloocan shops of PNR changed with the maintenance of rolling stocks for repairs - major repair of locomotives, engines, etc. It found that there is a community of interest among the workers of the Caloocan shops, since they are grouped in one place and work under the same conditions, and exposed to the same occupational risk. Though evidence on record shows that workers at the Caloocan Shops perform the same nature of work as their counterparts in the Manila Shed, the difference lies in the fact that workers at the Caloocan Shops perform major repairs of locomotives, rolling stocks, engines, etc., while those in the Manila Shed, works on minor repairs. Heavy equipment and machineries are found in the Caloocan Shops.

A "bargaining unit" is a group of employees of a given employer, comprised of all or less than all of the entire body of employees, which the collective interest of all the employees, consistent with equity to the employer, indicate to be the best suited to serve the reciprocal rights and duties of the parties under the collective bargaining provisions of the law. The test of the grouping is community or mutuality of interests. And this is so because 'the basic test of an asserted bargaining unit's acceptability is whether or not it is fundamentally the combination which will best assure to all employees the exercise of their collective bargaining rights." Hence, in that case, the Court upheld the trial court's conclusion that two separate bargaining units should be formed, one consisting of regular and permanent employees and another consisting of casual laborers or stevedores. MECHANICAL DEPARTMENT LABOR UNION SA PHILIPPINE NATIONAL RAILWAYS v. CIR G.R. No. L-28223 August 30, 1968

In view of its findings and the history of "union representation" in the railway company, indicating that bargaining units had been formed through separation of new units from existing ones whenever plebiscites had shown the workers' desire to have their own representatives, and relying on the "Globe doctrine", CIR held that the employees in the Caloocan Shops should be given a chance to vote on whether their group should be separated from that represented by the Mechanical Department Labor Union, and ordered a plebiscite held for the purpose. P Union appealed to SC questioning the applicability under the circumstances of the “Globe doctrine” of considering the will of the employees in determining what union should represent them.

FACTS: R Samahanng mga Manggagawa sa Caloocan Shops filed a petition calling attention to the fact that there were three unions in the Caloocan shops of the PNR (Samahan, KapisananngManggagawasa Manila Railroad Company, and Mechanical Department Labor Union), that no certification election had been held in the last 12 months, that both R Samahanand P had submitted labor demands upon the management for which reason a certification election was needed to determine the proper collective bargaining agency for the Caloocan shop workers. This was opposed by the management and P.

ISSUE: W/N a plebiscite election should be held to determine whether EEs at the Caloocan shops desire R Union to be separated from the P union so that it may be recognized as a separate bargaining unit. RULING: YES. Under the Globe doctrine, bargaining units may be formed through separation of new units from existing ones whenever plebiscites had shown the

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Magsino Labor Relations Digests, Arbues 2019 workers’ desire to have their own representatives. Technically, this appeal is premature, since the result of the ordered plebiscite among the workers of the Caloocan shops may be adverse to the formation of a separate unit, in which event, as stated in the appealed order, all questions raised in this case would be rendered moot and academic.

Issue: WON petitioner's monthly paid rank-and file employees can constitute a bargaining unit separate from the existing bargaining unit of its daily paid rank-andfile employees. Held: Yes.

Appellant contends that the application of the "Globe doctrine" is not warranted because the workers of the Caloocan shops do not require different skills from the rest of the workers in the Mechanical Department of the Railway Company. This question is primarily one of facts. The Industrial Court has found that there is a basic difference, in that those in the Caloocan shops not only have a community of interest and working conditions but perform major repairs of railway rolling stock, using heavy equipment and machineries found in said shops, while the others only perform minor repairs. It is easy to understand, therefore, that the workers in the Caloocan shops require special skill in the use of heavy equipment and machinery sufficient to set them apart from the rest of the workers. In addition, the record shows that the collective bargaining agreements negotiated by the appellant union have been in existence for more than two (2) years; hence, such agreements can not constitute a bar to the determination, by proper elections, of a new bargaining representative (PLDT Employees' Union vs. Philippine Long Distance Telephone Co.)

The monthly paid office and technical rank-and-file employees of petitioner Golden Farms enjoy the constitutional right to self-organization and collective bargaining. A "bargaining unit" has been defined as a group of employees of a given employer, comprised of all or less than all of the entire body of employees, which the collective interest of all the employees, consistent with equity to the employer, indicate to be the best suited to serve the reciprocal rights and duties of the parties under the collective bargaining provisions of the law. The community or mutuality of interest is therefore the essential criterion in the grouping. "And this is so because 'the basic test of an asserted bargaining unit's acceptability is whether or not it is fundamentally the combination which will best assure to all employees the exercise of their collective bargaining rights.' In the case at bench, the evidence established that the monthly paid rankand-file employees of petitioner primarily perform administrative or clerical work. In contradistinction, the petitioner's daily paid rank-and-file employees mainly work in the cultivation of bananas in the fields. It is crystal clear the monthly paid rank-andfile employees of petitioner have very little in common with its daily paid rank-andfile employees in terms of duties and obligations, working conditions, salary rates, and skills. To be sure, the said monthly paid rank-and-file employees have even been excluded from the bargaining unit of the daily paid rank-and-file employees. This dissimilarity of interests warrants the formation of a separate and distinct bargaining unit for the monthly paid rank-and-file employees of the petitioner. To rule otherwise would deny this distinct class of employees the right to self-organization for purposes of collective bargaining. Without the shield of an organization, it will also expose them to the exploitations of management.

As to the charge that some of the members of the appellee, "Samahan Ng Manggagawa", are actually supervisors, it appears that the question of the status of such members is still pending final decision; hence, it would not constitute a legal obstacle to the holding of the plebiscite. At any rate, the appellant may later question whether the votes of those ultimately declared to be supervisors should be counted. G.R. No. 102130 July 26, 1994 GOLDEN FARMS v SECRETARY OF LABOR Facts: On February 27, 1992, private respondent Progressive Federation of Labor (PFL) filed a petition before the Med-Arbiter praying for the holding of a certification election among the monthly paid office and technical rank-and-file employees of petitioner Golden Farms. Petitioner moved to dismiss the petition because there was already an existing collective bargaining agreement between the rank-and-file employees represented by the National Federation of Labor (NFL) and petitioner. Respondent PFL opposed petitioner's Motion to Dismiss. It countered that the monthly paid office and technical employees should be allowed to form a separate bargaining unit because they were expressly excluded from coverage in the Collecting Bargaining Agreement (CBA) between petitioner and NFL.

*Note It was petitioner company that filed the motion to dismiss the petition for election. The general rule is that an employer has no standing to question a certification election since this is the sole concern of the workers. 11 Law and policy demand that employers take a strick, hands-off stance in certification elections. The bargaining representative of employees should be chosen free from any extraneous

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Magsino Labor Relations Digests, Arbues 2019 influence of management. A labor bargaining representative, to be effective, must owe its loyalty to the employees alone and to no other.

The Labor Code recognizes 2 principal groups of employees, namely, the managerial and the rank and file groups. Members of the KASAMA KO who are professional, technical, administrative and confidential personnel of PHILTRANCO performing managerial functions are not qualified to join, much less form a union. They were expressly excluded within the operational ambit of the bargaining unit for the simple reason that under the law, managers are disqualified to be members of a labor organization.

G.R. No. 85343 June 28, 1989 PHILTRANCO SERVICE ENTERPRISES v s BUREAU OF LABOR RELATIONS

The employees of Philtranco have been appraised and their functions evaluated. Managers by any name may not join the rank and file union. On the other hand, those who are rank and file workers may join the existing bargaining unit instead of organizing another bargaining unit and compelling the employer to deal with it.

Facts:

*One-union, one-company

On February 15, 1988, the Kapisanan ng mga Kawani, Assistant, We see no need for the formation of another union in PHILTRANCO. The qualified members of the KASAMA KO may join the NAMAWU-MIF if they want to be union members, and to be consistent with the one-union, one-company policy of the DOLE.

Manggagawa at Konpidensyal sa Philtranco (KASAMA KO), a registered labor organization filed a petition for certification election with DOLE seeking to represent all professional, technical, administrative, and confidential employees personnel of respondent at its establishments in Luzon, Visayas and Mindanao for purposes of collective bargaining. KASAMA KO alleged that they were always expressly excluded from participating in the certification election conducted among the rank and file employees (drivers, conductors, coach drivers, coach stewards, and mechanics) of respondent and are excluded from the bargaining unit covered by the CBA between respondent and its rank and file employees. In addition, there exist substantial differences in the terms and conditions of employment between the above-mentioned employees, hence, the former are covered by another appropriate bargaining unit which is separate and distinct from that of the rank and file employees of respondent.

It is natural in almost all fairly sized companies to have groups of workers discharging different functions. No company could possibly have all employees performing exactly the same work. Variety of tasks is to be expected. It would not be in the interest of sound labor-management relations if each group of employees assigned to a specialized function or section would decide to break away from their fellow-workers and form their own separate bargaining unit. We cannot allow one unit for typists and clerks, one unit for accountants, another unit for messengers and drivers, and so on in needless profusion. Where shall the line be drawn? The questioned decision of the public respondent can only lead to confusion, discord and labor strife.

On February 24, 1988, the National Mines and Allied Workers Union (NAMAWU-MIF) filed a motion for intervention alleging that it is the bargaining agent of the workers at Philtranco and as such it has a substantial interest in the outcome of the petition.

The respondents state that this case is an exception to the general rule considering that substantial differences exist between the office employees or professional, technical, administrative and confidential employees vis-a-vis the field workers or drivers, conductors and mechanics of the petitioner. Against this contention, we find that the "substantial differences" in the terms and conditions of employment between the private respondent's members and the rest of the company's rank and file employees are more imagined than real. We agree with the petitioner

Issue: WON KASAMA KO may represent all professional, technical, administrative, and confidential employees personnel. Held: No.

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Magsino Labor Relations Digests, Arbues 2019 that the differences alleged are not substantial or significant enough to merit the formation of another union.

Held: Yes. The fact that the three plants are located in three different places, namely, in Cabuyao, Laguna, in Otis, Pandacan, Metro Manila, and in San Fernando, Pampanga is immaterial. Geographical location can be completely disregarded if the communal or mutual interests of the employees are not sacrificed. An appropriate bargaining unit may be defined as “a group of employees of a given employer, comprised of all or less than all of the entire body of employees, which the collective interest of all the employees, consistent with equity to the employer, indicate to be best suited to serve the reciprocal rights and duties of the parties under the collective bargaining provisions of the law.” A unit to be appropriate must effect a grouping of employees who have substantial, mutual interests in wages, hours, working conditions and other subjects of collective bargaining.

SAN MIGUEL UNION VS. LAGUESMA G.R. No. 110399 August 15, 1997 Facts: Petitioner union filed before DOLE a Petition for Direct Certification or Certification Election among the supervisors and exempt employees of the SMC Magnolia Poultry Products Plants of Cabuyao, San Fernando and Otis. Med-Arbiter Danilo L. Reynante issued an Order ordering the conduct of certification election among the abovementioned employees of the different plants as one bargaining unit.

G.R. No. 77395 November 29, 1988 BELYCA CORPORATION v DIR. CALLEJA

San Miguel Corporation filed a Notice of Appeal with Memorandum on Appeal, pointing out, among others, the Med-Arbiter’s error in grouping together all three (3) separate plants, into one bargaining unit, and in including supervisory levels 3 and above whose positions are confidential in nature.

Facts: On June 3, 1986, private respondent Associated Labor Union (ALU)-TUCP filed a petition for direct certification as the sole and exclusive bargaining agent of all the rank and file employees/workers of Belyca Corporation (Livestock and AgroDivision). The collective bargaining unit sought for the issuance of an order authorizing the immediate holding of a certification election.

The public respondent, Usec Laguesma, granted respondent company’s Appeal and ordered the remand of the case to the Med-Arbiter of origin for determination of the true classification of each of the employees sought to be included in the appropriate bargaining unit. Upon petitioner-union’s motion, Undersecretary Laguesma granted the reconsideration prayed for and directed the conduct of separate certification elections among the supervisors ranked as supervisory levels 1 to 4 (S1 to S4) and the exempt employees in each of the three plants at Cabuyao, San Fernando and Otis.

Respondent employer alleged that due to the nature of its business, very few of its employees are permanent, the overwhelming majority of which are seasonal and casual and regular employees and that 138 employees who signed were no longer part of the corporation. Petitioner contends that the bargaining unit must include all the workers in its integrated business concerns ranging from piggery, poultry, to supermarts and cinemas so as not to split an otherwise single bargaining unit into fragmented bargaining units. LA granted the petition.

Issue: WON the employees of the three plants constitute an appropriate single bargaining unit.

Issue: WON THE PROPOSED BARGAINING UNIT IS AN APPROPRIATE BARGAINING UNIT.

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Magsino Labor Relations Digests, Arbues 2019 Held: Yes. Art. 256 does not specifically define what constitutes an appropriate collective bargaining unit. There are 4 factors to be considered in determining the proper bargaining unit to wit: (1) will of employees (Glove Doctrine); (2) affinity and unity of employee's interest, such as substantial similarity of work and duties or similarity of compensation and working conditions; (3) prior collective bargaining history; and (4) employment status, such as temporary, seasonal and probationary employees".

Abaquin Security. These three agencies were collectively referred to by private respondent Union as the "PGA Security Agency. On April 11, 1986, petitioners filed a single comment alleging therein that the said three security agencies have separate and distinct corporate personalities. Issue: WON the employer may intervene in the certification election. Held: No. Except where the employer has to file a petition for certification election pursuant to Article 258 because of a request to bargain collectively, it has nothing to do with a certification election which is the sole concern of the workers. Its role in a certification election is a mere by-stander. It has no legal standing in a certification election as it cannot oppose the petition or appeal the Med-Arbiter's orders related thereto. An employer that involves itself in a certification election lends suspicion to the fact that it wants to create a company union.

The Court stressed the importance of the fourth factor and sustained the trial court's conclusion that two separate bargaining units should be formed in dealing with respondent company, one consisting of regular and permanent employees and another consisting of casual laborers or stevedores. Otherwise stated, temporary employees should be treated separately from permanent employees. But more importantly, this Court laid down the test of proper grouping, which is community and mutuality of interest. Where the employment status was not at issue but the nature of work of the employees concerned; the Court stressed the importance of the second factor otherwise known as the substantial-mutual-interest test.

G.R. No. 101730. June 17, 1993 PT&T v LAGUESMA and PT&T SUPERVISORY EMPLOYEES UNION-APSOTEU

It is beyond question that the employees of the livestock and agro division of petitioner corporation perform work entirely different from those performed by employees in the supermarts and cinema. Among others, the noted differences are: their working conditions, hours of work, rates of pay, including the categories of their positions and employment status. As stated by petitioner corporation in its position paper, due to the nature of the business in which its livestock-agro division is engaged very few of its employees in the division are permanent, the overwhelming majority of which are seasonal and casual and not regular employees.

G.R. No. 92357 July 21, 1993 PHIL. SCOUT VETERANS AND INVESTIGATION AGENCY (PSVSIA) v SECRETARY

Facts: PT&T Supervisory Employees Union- APSOTEU (UNION, for brevity) filed a petition before the Industrial Relations praying for the holding of a certification election among the supervisory employees of petitioner Philippine Telegraph & Telephone Corporation (PT&T, for brevity). On 29 October 1990, UNION amended its petition to include the allegation that PT&T was an unorganized establishment employing roughly 100 supervisory employees from whose ranks will constitute the bargaining unit sought to be established. On 22 November 1990, PT&T moved to dismiss the petition for certification election on the ground that UNION members were performing managerial functions and thus were not merely supervisory employees. Moreover, PT&T alleged that a certified bargaining unit already existed among its rank-and-file employees which barred the filing of the petition.

SECURITY Issue: Can a petition for certification election filed by supervisory employees of an unorganized establishment — one without a certified bargaining agent — be dismissed on the ground that these employees are actually performing managerial functions?

Facts: On April 6, 1989, private respondent labor union, PGA Brotherhood Association - Union of Filipino Workers (UFW), hereinafter referred to as "the Union" filed a petition for Direct Certification/Certification Election among the rank and file employees of Philippine Scout Veterans Security, GVM Security and

Held: No.

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Magsino Labor Relations Digests, Arbues 2019 The applicable provision of law in the case at bar is Art. 257 of the Labor Code. The supervisor employees of PT&T did not yet have a certified bargaining agent to represent them at the time the UNION, which is a legitimate labor organization duly registered with the Department of Labor and Employment, filed the petition for certification election. Since no certified bargaining agent represented the supervisory employees, PT&T may be deemed an unorganized establishment within the purview of Art. 257 of the Labor Code. The fact that petitioner's rank-andfile employees were already represented by a certi􀀼ed bargaining agent does not make PT&T an organized establishment vis-a-vis the supervisory employees. After all, supervisory employees are "not eligible for membership in a labor organization of the rank-and-file employees." Consequently, the Med-Arbiter, as sustained by public respondent, committed no grave abuse of discretion in granting the petition for certification election among the supervisory employees of petitioner PT&T because Art. 257 of the Labor Code provides that said election should be automatically conducted upon filing of the petition.

G.R. No. 116172. October 10, 1996. SAN MIGUEL FOODS, INC.-CEBU B-MEG FEED PLANT v LAGUESMA and IBM Facts: On September 1993, a petition for certification election among the monthlypaid employees of the San Miguel Foods, Inc.-Cebu B-Meg Feeds Plant was filed by private respondent labor federation Ilaw at Buklod ng Manggagawa (IBM, for brevity) before Med- Arbiter alleging, inter alia, that it is a legitimate labor organization duly registered with DOLE. Petition granted. Issue: WON IBM was a legitimate labor organization. Held: It is important to determine whether or not a particular labor organization is legitimate since legitimate labor organizations have exclusive rights under the law which cannot be exercised by nonlegitimate unions, one of which is the right to be certi􀀼ed as the exclusive representative of all the employees in an appropriate collective bargaining unit for purposes of collective bargaining. These rights are found under Article 242 of the Labor Code.

PT&T did not possess the legal personality to file a motion to dismiss the petition for certification election even if based on the ground that its supervisory employees are in reality managerial employees. It is well-settled that an employer has no standing to question a certification election since this is the sole concern of the workers. The only exception to this rule is where the employer has to file the petition for certification election itself pursuant to Art. 258 of the Labor Code because it was requested to bargaining collectively. But, other than this instance, the choice of a collective bargaining agent is purely the internal affair of labor. What PT&T should have done was to question the inclusion of any disqualified employee in the certification election during the exclusion-inclusion proceedings before the representation officer. Indeed, this is precisely the purpose of the exclusion-inclusion proceedings, i.e., to determine who among the employees are entitled to vote and be part of the bargaining unit sought to be certified.

Ordinarily a labor organization attains the status of legitimacy only upon the issuance in its name of a Certificate of Registration by the BLR pursuant to Articles 234 and 235 of the Labor Code. The foregoing procedure is not the only way by which a labor union may become legitimate, however. When an unregistered union becomes a branch, local or chapter of a federation, some of the aforementioned requirements for registration are no longer required. Section 3, Rule II, Book V of the Implementing Rules of the Labor Code governs the procedure for union affiliation. Paragraph (a) refers to a local or chapter of a federation which did not undergo the rudiments of registration while paragraph (b) refers to an independently registered union which affiliated with a federation. Implicit in the foregoing differentiation is the fact that a local or chapter need not be independently registered. By force of law (in this case, Article 212 [h]), such local or chapter becomes a legitimate labor organization upon compliance with the aforementioned provisions of Section 3 (a) and (e), without having to be issued a Certificate of Registration in its favor by the BLR. Absent compliance with these mandatory requirements, the local or chapter does not become a legitimate labor organization. Corollarily, the satisfaction of all these requirements by the local or chapter shall vest upon it the status of legitimacy with all its concomitant statutory privileges, one of which is the right to be certified as the exclusive representative of all the employees in an appropriate bargaining unit.

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Magsino Labor Relations Digests, Arbues 2019 pursuant to Article 258 of the Labor Code because it was requested to bargain collectively, which exception finds no application in the case before us. Its role in a certification election has aptly been described as that of a mere by-stander. It has no legal standing in a certification election as it cannot oppose the petition or appeal the Med-Arbiter's orders related thereto. An employer that involves itself in a certification election lends suspicion to the fact that it wants to create a company union. This Court should be the last agency to lend support to such an attempt at interference with a purely internal affair of labor. While employers may rightfully be notified or informed of petitions of such nature, they should not, however, be considered parties thereto with the concomitant right to oppose it. Sound policy dictates that they should maintain a strictly hands-off policy. G.R. No. L-41937. July 6, 1976 FOITAF-ASSOCIATED ANGLO AMERICAN CHAPTER vs Director CARMELO NORIEL

Petitioner SMFI does not dispute the fact that IBM at SMFI has complied with the second set of requirements, i.e., constitution, by-laws, et al. What is controverted is the non-compliance with the requirement as to the charter certificate which must be submitted to the BLR within 30 days from its issuance by the labor federation. While the presence of a charter certificate is conceded, petitioner maintains that the validity and authenticity of the same cannot yet be ascertained as it is still not known who is the legitimate and authorized representative of the IBM Federation who may validly issue said charter certificate in favor of its local, IBM at SMFI. According to petitioner, there are 2 contending sets of officers of the IBM Federation at the time the charter certi􀀼cate was issued in favor of IBM at SMFI, the faction of Mr. Severino O. Meron and that of Mr. Edilberto B. Galvez. We agree with the position of the public respondent and the Solicitor General in upholding the legitimate status of IBM at SMFI. In addition private respondent's Comment to this petition indicates that in the election of o􀀼cers held to determine the representatives of IBM, the faction of Mr. Meron lost to the group of Mr. Edilberto Galvez, and the latter was acknowledged as the duly elected IBM National President. Thus, the authority of Mr. Galvez to sign the charter certificate of IBM at SMFI, as President of the IBM Federation, can no longer be successfully questioned.

Facts: Private respondent union filed a verified petition for certification election among the employees and workers of the Company alleging that more than thirty percent of its rank and file workers support the same. The med-arbiter assigned to the case ordered that an election be conducted. The petitioner union appealed from said order on the sole ground that there was failure to comply with the 39% requirement alleging that there had been retractions of some employees without however presenting proofs of the same. The BLR issued a resolution sustaining the previous order of the med-arbiter for a certification election. A MR of said resolution was filed, opposed and denied. Hence the petition for certiorari labeling respondent Director's order for the holding of a certification election, despite the alleged failure to comply with the 30% requirement of the Labor Code, as arbitrary and improvident exercise of authority.

*CHARTER CERTIFICATE; CERTIFICATION UNDER OATH BY THE ORGANIZATION'S SECRETARY AND PRESIDENT NOT ESSENTIAL FOR VALIDITY THEREOF Petitioner next asseverates that the Charter Certificate submitted by the private respondent was defective in that it was not certified under oath and attested to by the organization's secretary and President. Petitioner is grasping at straws. Under our ruling in the Progressive Development Corporation case, what is required to be certified under oath by the secretary or treasurer and attested to by the local's president are the "constitution and by-laws, a statement on the set of officers, and the books of accounts" of the organization. The charter certificate issued by the mother union need not be certified under oath by the secretary or treasurer and attested to by the local's president.

Issue: WON the certification election was proper Held: Yes. Where the verified petition by private respondent labor union had the support of more than thirty percent of the rank and file employees, it becomes, in the language of the new Labor Code, "mandatory for the Bureau to conduct a certification election for the purpose of determining the representatives of the employees in the appropriate bargaining unit and certify the winner as the exclusive collective bargaining representative of all the employees in the unit." It would run counter to the law then, with the duty thus imposed on respondent Director, to ignore the demand that it be held.

*CERTIFICATION ELECTION; ROLE OF EMPLOYER IS THAT OF A MERE BY-STANDER THEREIN; Exception In any case, this Court notes that it is petitioner, the employer, which has offered the most tenacious resistance to the holding of a certification election among its monthly-paid rank-and-file employees. This must not be so, for the choice of a collective bargaining agent is the sole concern of the employees. The only exception to this rule is where the employer has to file the petition for certification election

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Magsino Labor Relations Digests, Arbues 2019 No grave abuse of discretion, much less arbitrariness could be imputed to the rejection of the plea of petition to set aside the challenged order for the holding of a certification election inspite of the alleged failure to comply with the 30% requirement of the New Labor Code. The alleged retraction on the part of a number of employees involved resulting in the requirement of the law not being met is highly dubious in character. The 13 employees who allegedly retracted were not even presented before the med-arbiter and the alleged additional 45 employees who supposedly likewise changed their minds, were also not called to testify to the effect, petitioner satisfy itself with their being named in an a􀀼davit executed by its presented. There is no justification for sustaining petitioner's stand. To do so would be to disregard previous authoritative doctrines on the matter involving the basic constitutional of freedom of association, made even more meaningful in labor matters by the statutory device of certification election.

a labor organization of their choice. Thus may be discerned how crucial is a certification election. Certification election is the fairest and most effective way of determining which labor organization can duly represent the working force. It is a fundamental postulate that the will of the majority, if given expression in an honest election with freedom on the part of the voters to make their choice, is controlling. No better device can assure the institution of industrial democracy with the two parties to a business enterprise, management and labor, establishing a regime of self-rule. G.R. No. L-33705. April 15, 1977. AIR LINE PILOTS ASSOCIATION OF THE PHILIPPINES (GASTON GROUP) v CIR Facts: G.R. No. L-33705 April 15, 1977 AIR LINE PILOTS ASSOCIATION OF THE PHILIPPINES (GASTON GROUP), petitioner, 
vs.
THE COURT OF INDUSTRIAL RELATIONS and AIR LINES PILOTS ASSOCIATION OF THE PHILIPPINES (GOMEZ GROUP), respondents

*INDUSTRIAL PEACE ACT AND THE NEW LABOR CODE STRESS EMPLOYEES RIGHT TO SELF-ORGANIZATION. — There is in the Industrial Peace Act this categorical provision on the right of employees to self-organization: "Employees shall have the right to self-organization and to form, join or assist labor organization of their own choosing for the purpose of collective bargaining through representatives of their own choosing and to engage in concerted activities for the purpose of collective bargaining and other mutual aid or protection." (Section 3 of RA 875) The new Labor Code (PD 442, 1974) is equally explicit on the matter. Thus: "The State shall assure the rights of workers to selforganization, collective bargaining, security of tenure and just and humane condition of work." *HOLDING OF A CERTIFICATION REPRESENTATIVE UNION. —

ELECTION

TO

Facts: These are two petitions for certiorari (L-33705 and L-35206), consolidated for purposes of decision because they involve more or less the same parties and interlocking issues. L-33705 On January 2, 1971, the ALPAP, represented by Capt. Gomez, who claimed to be its president, filed a petition with CIR praying for certification as the sole and exclusive collective bargaining representative of "all the pilots now under employment by the Philippine Air Lines, Inc, and are on active flight and/or operational assignments." This was opposed by Capt. Gaston who also claimed to be the president alleging that CIR had no jurisdiction over the subject matter “because a certification proceeding in the Court of Industrial Relations is not the proper forum for the adjudication of the question as to who is the lawful president of a legitimate labor organization”. The Judge thereafter ruled in favor of Gomez.

DETERMINE

It is of the very essence of the regime of industrial democracy sought to be attained through the collective bargaining process that there be no obstacle to the freedom identified with the exercise of the right to selforganization. Labor is to be represented by a union that can express its collective will. In the event, and this is usually the case, that there is more than one such group fighting for that privilege, a certification election must be conducted. The institution of collective bargaining is, to recall Cox, a prime manifestation of industrial democracy at work. The 2 parties to the relationship, labor and management, make their own rules by coming to terms. That is to govern themselves in matters that really count. As labor, however, is composed of a number of individuals, it is indispensable that they be represented by

ALPAP then held a meeting where 221 of the 270 members adopted a resolution amending ALPAP’s constitution and by-laws by providing in a new section thereof that — “Any active member who shall be forced to retire or forced to resign or otherwise terminated for union activities as solely determine' by the Association shall have the option to either continue to be and remain as an active member in good standing or to resign in writing his active membership with the Association.”

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Magsino Labor Relations Digests, Arbues 2019 Gaston then said that the amendment was adopted "In anticipation on the fact that they may be forced to resign or retire because of their 'union activities.' A majority of ALPAP members filed letters of retirement/ resignation from PAL. Thereafter, an election for officers was held resulting to the election of Gaston as president. Those however, who did not tender resignation voted for Gomez as president.

Issue: WON the authorization given by the industrial court to ALPAP (Gomez), in a certification proceeding to take over the corporate name, office and funds of ALPAP is valid. Held: No. We have made a careful examination of the records of L-33705 and we find the adoption of the resolution introducing the questioned amendment to be substantial compliance with the ALPAP constitution and by-law. Indeed, there is no refutation of the act that 221out of the 270 members of ALPAP did cast their votesin favor of the said amendment on October 30, 1970 at the ALPAP general membership meeting.

On June 3, 1971, ALPAP (Gaston) filed an opposition in Case 101-IPAB to an urgent ex parte motion of the PAL to enjoin the members of ALPAP from retiring or resigning en masse. It claimed that they sought for reinstatement and that their filing of resignations is a valid exercise of their constitutional rights and they could not be deprived of their benefits. The opposition however was denied. L-35206 A labor dispute was certified by the President of the Philippines between ALPAP and PAL and was assigned to Judge Paredes. After conferring with the parties, the Judge issued a return-to-work order, which ordered ALPAP members to return to work and ordered PAL not to suspend or dismiss any employee as result of the strike and failure to comply to the said order shall result to contempt of court. The employees then returned to work but Gaston, however, did not and it resulted to his termination.

Their Court cannot likewise subscribe to the restrictive interpretation made by the court below of the term "labor organization," which Section 2(e) of R.A. 875 defines as any union or association of employees which exist, in whole or in part, for the purpose of the collective bargaining or dealing with employers concerning terms and conditions of employment." The absence of the condition that the court would attach to the statutory concept of a labor organization, as being limited to the employees of particular employer, is quite evident from the law. The emphasis of Industrial Peace Act is clearly on the purposes for which a union or association of employees established rather than that membership therein should be limited only to the employees of a particular employer. Trite to say, under Section 2(h) of R.A 875 "representative" is define as including "a legitimate labor organization or any officer or agent of such organization, whether or not employed by the employer or employee whom he represents." It cannot be overemphasized likewise that labor dispute can exist "regardless of whether the disputants stand in the proximate relation of employer and employee. (Section 2(j), R.a. 875).

PAL then filed an urgent motion with the CIR to enjoin the members of ALPAP from proceeding with their intention to resign/ retire en masse. The judge then issued an order to ALPAP not to strike otherwise they will be terminated. ALPAP then filed an MR alleging that such order subjects them to involuntary servitude. Their MR was denied. It then resulted to mass resignation and PAL accepted such and the caveat pilots who retired were no longer entitled to benefits as the Pilots acts constituted a violation of the court’s order not to strike. Gomez then filed a petition to allow him to represent ALPAP since those who voted for Gaston has already resigned. Gaston and the pilots who resigned then prayed to the CIR that they be reinstated. This was opposed by Gomez and PAL but the judge ordered a dismissal of their opposition and ordered the reinstatement. The CIR however reversed the order of Judge Paredeson the ground that the question of the employee status of the pilots who were seeking reinstatement with PAL has already been raised squarely in Case 2939-MC and resolved by the said tribunal found that the said pilots have already lost their employee status as a consequence of their resignations and/or retirement from PAL which had been duly accepted by the latter.

There is, furthermore, nothing in the constitution and by-laws of ALPAP which indubitably restricts membership therein to PAL pilots alone. 1 Although according to ALPAP (Gomez) there has never been an instance when a non-PAL pilot became a member of ALPAP, the complete lack of any such precondition for ALPAP membership cannot but be interpreted as an unmistakable authority for the association to accept pilots into its fold though they may not be under PAL's employ. The fundamental assumptions relied upon by the industrial court as bases for authorizing ALPAP (Gomez) to take over the office and funds of ALPAP being, in this Court's opinion, erroneous, and, in the absence of any serious dispute that on December 18-22, 1970 Felix C. Gaston, and four other pilots, were elected by the required majority of ALPAP members as officers of their association, this Court hereby rules that the mentioned authorization to ALPAP (Gomez) to take over the office, funds and name of ALPAP was done with grave abuse of discretion.

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Magsino Labor Relations Digests, Arbues 2019 G.R. No. 84433. June 2, 1992 ALEXANDER REYES v CRESENCIANO B. TRAJANO

appropriate bargaining unit are entitled to vote. This principle is clearly stated in Art. 255 of the Labor Code which states that the 'labor organization designated or selected by the majority of the employees in an appropriate bargaining unit shall be the exclusive representative of the employees in such unit for the purpose of collective bargaining.' Collective bargaining covers all aspects of the employment relation and the resultant CBA negotiated by the certified union binds all employees in the bargaining unit. Hence, all rank-and-file employees, probationary or permanent, have a substantial interest in the selection of the bargaining representative. The Code makes no distinction as to their employment status as basis for eligibility in supporting the petition for certification election. The law refers to 'all' the employees in the bargaining unit. All they need to be eligible to support the petition is to belong to the 'bargaining unit.

Facts: A certification election was held among the employees of Tri-Union Industries Corporation. The competing unions were the Tri-Union Employees Union-Organized Labor Association in Line Industries and Agriculture (TUEUOLALIA), and Trade Union of the Philippines and Allied Services (TUPAS). Of the 348 workers initially deemed to be qualified voters, only 240 actually took part in the election, conducted under the supervision of the BLR. Among the 240 employees who cast their votes were 141 members of the INC. TUEU-OLALIA garnished the most votes sans the INC votes. The challenged votes were those cast by the 141 INC members. They were segregated and excluded from the final count in virtue of an agreement between the competing unions, reached at the pre-election conference that the INC members should not be allowed to vote "because they are not members of any union and refused to participate in the previous certification elections."

Neither does not the contention that petitioners should be denied the right to vote because they "did not participate in previous certification elections in the company for the reason that their religious beliefs do not allow them to form, join or assist labor organizations," persuade acceptance. No law, administrative rule or precedent prescribes forfeiture of the right to vote by reason of neglect to exercise the right in past certification elections. In denying the petitioners' right to vote upon these egregiously fallacious grounds, the public respondents exercised their discretion whimsically, capriciously and oppressively and gravely abused the same.

The INK employees promptly made known their protest to the exclusion of their votes. They filed a petition to cancel the election alleging that it "was not fair" and the result thereof did "not reflect the true sentiments of the majority of the employees." TUEU-OLALIA opposed the petition. It contended that the petitioners "do not have legal personality to protest the results of the election," because "they are not members of either contending unit, but of the INC" which prohibits its followers, on religious grounds, from joining or forming any labor organization.

The purpose of a certification election is precisely the ascertainment of the wishes of the majority of the employees in the appropriate bargaining unit: to be or not to be represented by a labor organization, and in the affirmative case, by which particular labor organization. If the results of the election should disclose that the majority of the workers do not wish to be represented by any union, then their wishes must be respected, and no union may properly be certified as the exclusive representative of the workers in the bargaining unit in dealing with the employer regarding wages, hours and other terms and conditions of employment. The minority employees — who wish to have a union represent them in collective bargaining — can do nothing but wait for another suitable occasion to petition for a certification election and hope that the results will be different. They may not and should not be permitted, however, to impose their will on the majority — who do not desire to have a union certified as the exclusive workers' benefit in the bargaining unit - upon the plea that they, the minority workers, are being denied the right of self organization and collective bargaining. G.R. No. 92391. July 3, 1992 PHILIPPINE FRUITS AND VEGETABLE INDUSTRIES v HON. RUBEN D. TORRES

Issue: WON INC votes must be counted despite not being part of a labor union. Held: Yes. The respondents' argument that the petitioners are disqualified to vote because they "are not constituted into a duly organized labor union" — "but members of the INC which prohibits its followers, on religious grounds, from joining or forming any labor organization" — and "hence, not one of the unions which vied for certification as sole and exclusive bargaining representative," is specious. Neither law, administrative rule nor jurisprudence requires that only employees affiliated with any labor organization may take part in a certification election. On the contrary, the plainly discernible intendment of the law is to grant the right to vote to all bona fide employees in the bargaining unit, whether they are members of a labor organization or not. In a certification election all rank-and-file employees in the

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Magsino Labor Relations Digests, Arbues 2019 Facts: On December 16, 1988, a certification election filed by the Trade Union of the Philippines and Allied Services (TUPAS). Said order directed the holding of a certification election among the regular and seasonal workers of the Philippine Fruits and Vegetables, Inc. After a series of pre-election conferences, all issues relative to the conduct of the certification election were threshed out except that which pertains to the voting qualifications of the 194 workers enumerated in the lists of qualified voters submitted by TUPAS. However, Med Arbiter ordered the opening of their votes in order to attain majority. On February 23, 1989, petitioner formally filed a Protest.

December 16, 1988, and that such employees had in fact voted accordingly on election day. Viewed thus in the light of the substantial participation in the elections by voter-employees, and further in the light of the all-too settled rule that in interpreting the Constitution's protection to labor and social justice provisions and the labor laws and rules and regulations implementing the constitutional mandate, the SC adopts the liberal approach which favors the exercise of labor rights, We find the lack of one day in the posting of notices insignificant, and hence, not a compelling reason at all in nullifying the elections. *EMPLOYEES IMPROPERLY LAID-OFF; ELIGIBLE TO VOTE . Employees who have been improperly laid off but who have a present, unabandoned right to or expectation of reemployment, are eligible to vote in certification elections. Thus if the dismissal is under litigation the employees concerned could still qualify to vote in the elections.

Issue: WON the protest was filed within the reglementary period. Held: No. The records before Us quite clearly disclose the fact that petitioner, after filing a manifestation of protest on December 16, 1988, election day, only formalized the same on February 20, 1989, or more than 2 months after the close of election proceedings. We are not persuaded by petitioner's arguments that election proceedings include not only casting of votes but necessarily includes canvassing and appreciation of votes cast and considering that the canvassing and appreciation of all the votes cast were terminated only on February 16, 1989, it was only then that the election proceedings are deemed closed, and thus, when the formal protest was filed on February 20, 1989, the five-day period within which to file the formal protest still subsisted and its protest was therefore formalized within the reglementary period.

*CERTIFICATION ELECTION; PROTEST IN THE PROCEEDINGS A close reading of Sections 3 and 4, Rule VI, Book V of the Implementing Rules of the Labor Code, provides: "Section 3: The Representation officer may rule on any on-the-spot question arising from the conduct of the election. The interested party may however, file a protest with the representation officer before the close of the proceedings. "Protests not so raised are deemed waived. Such protest shall be contained in the minutes of the proceedings." "Section 4: Where the protest is formalized before the med-arbiter within 5 days after the close of the election proceedings, the med-arbiter shall decide the same within 20 working days from the date of formalization. If not formalized within the prescribed period, the protest shall be deemed dropped. The decision may be appealed to the Bureau in the same manner and on the same grounds as provided under Rule V."

As explained correctly by the Solicitor General, the phrase "close of election proceedings" as used in Sections 3 and 4 of the pertinent Implementing Rules refers to that period from the closing of the polls to the counting and tabulation of the votes as it could not have been the intention of the Implementing Rules to include in the term "close of the election proceedings" the period for the final determination of the challenged votes and the canvass thereof, as in the case at bar, which may take a very long period. Thus, if a protest can be formalized within five days after a final determination and canvass of the challenged votes have been made, it would result in an undue delay in the affirmation of the employees' expressed choice of a bargaining representative.

The following requirements in order that a protest filed thereunder would prosper, to wit: (1) The protest must be filed with the representation officer and made of record in the minutes of the proceedings before theclose of election proceedings, and (2) The protest must be formalized before the Med- Arbiter within 5 days after the close of the election proceedings. G.R. No. 143428. June 25, 2001 SANDOVAL SHIPYARDS v PRISCO PEPITO

Petitioner would likewise bring into issue the fact that the notice of certification election was posted only on December 12, 1988 or four days before the scheduled elections on December 16, 1988, instead of the five-day period as required under Section 1 of Rule VI, Book V of the Implementing Rules. But it is not disputed that a substantial number, or 291 of 322 qualified voters, of the employees concerned were informed, thru the notices thus posted, of the elections to be held on

Facts: Sometime in 1992, the National Federation of Labor (NFL) filed with DOLE a petition for certification election, alleging that its members, who included

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Magsino Labor Relations Digests, Arbues 2019 private respondents Prisco Pepito, et al., were regular employees of petitioner Sandoval Shipyards, Inc. (SSI). Finding that the NFL members were rank-and-file employees of SSI, the Med-Arbiter issued an order directing that a certification election be held. However, in a Resolution, then Undersecretary Bienvenido Laguesma reversed the Med-Arbiter's Order and ruled that there was a valid subcontracting agreement between SSI and its subcontractors, and that no employeremployee relationship existed between SSI and private respondents, since the latter were the employees of the subcontractors. In 1993, several cases for illegal dismissal were filed by private respondents against SSI and its President, petitioner Vicente Sandoval. The LA rendered its Decision in the illegal dismissal cases. He found that while private respondents were illegally dismissed, they were not entitled to reinstatement with backwages, damages and attorney's fees. The LA ruled that there was no employer-employee relationship between SSI and private respondents, citing the resolution of Undersecretary Laguesma in the certification election case. Private respondents then appealed to the NLRC, which affirmed the LA decision. Not satisfied with the decision of the NLRC, private respondents appealed to the Court of Appeals. The appellate court reversed the decision of the NLRC and held that SSI is the direct employer of private respondents. Petitioners filed a motion for reconsideration, but the same was denied for lack of merit. Hence, the present appeal.

"A certification proceeding is not a 'litigation' in the sense in which this term is commonly understood, but a mere investigation of a nonadversary, fact􀀼nding character, in which the investigating agency plays the part of a disinterested investigator seeking merely to ascertain the desires of the employees as to the matter of their representation. The court enjoys a wide discretion in determining the procedure necessary to insure the fair and free choice of bargaining representatives by the employees. The SC ruled that both the Labor Arbiter and the NLRC erred in holding that there was no employer-employee relationship between SSI and private respondents. A certification proceeding is not a "litigation" in the sense in which this term is commonly understood, but a mere investigation of a nonadversary, factfinding character, in which the investigating agency plays the part of a disinterested investigator seeking merely to ascertain the desires of the employees as to the matter of their representation. The appellate court properly noted that the issue as to whether private respondents were illegally dismissed, which was resolved in the affrmative by the LA, was not appealed by petitioners. Such ruling has therefore attained finality. Thus, petitioner SSI, as the direct employer of private respondents, was liable to either reinstate them or pay them backwages or separation pay. However, because there was not enough evidence on this matter, there is a need to remand the case to the Labor Arbiter for further proceedings.

Issue: WON CA erred in applying this Court's pronouncement in Manila Golf & Country Club vs. Intermediate Appellate Court that a decision in a certification election case regarding the existence of an employer-employee relationship does not foreclose all further dispute between the parties as to the existence or non-existence of such relationship. They contend that such pronouncement is obiter dictum since the issue involved therein was whether or not the persons rendering caddying services for the golf club's members and their guests in the club's courses or premises are employees of Manila Golf and Country Club and therefore within the compulsory coverage of the Social Security System, not the correctness of the MedArbiter's finding in the certification election case that no employer-employee relationship existed between the golf club and the caddies.

G.R. No. 95013. September 21, 1994 TRADE UNIONS OF THE PHILS/FEBRUARY SIX MOVEMENT (TUPAS/FSM) v Laguesma COLLECTIVE BARGAINING AND ADMINISTRATION OF AGREEMENTS; TERMS OF COLLECTIVE BARGAINING AGREEMENT (ARTICLE 253-A, LABOR CODE) APPLIED IN CASE AT BAR. — It is crystal clear from the records that the rank-and-file employees of private respondent's Glassware Division are, at present, represented by ILO-PHILS. Hence, petitioner's reliance on the March 22, 1990 Certification issued by Director Bautista, Jr., is misplaced. The existence and filing of their CBA was confirmed in a Certification, dated April 24, 1990. The certification of ILO-PHILS. "as the sole and exclusive bargaining agent of the rank-and-file workers of Transunion-Glassware Division," means it shall remain as such during the existence of the CBA, to the exclusion of other labor organizations, including petitioner, and no petition questioning the majority status of the incumbent bargaining agent shall be

Held: No. CA affirmed. The Court of Appeals correctly applied the ruling in Manila Golf & Country Club vs. IAC that "however final it may become, the decision in a certi􀀼cation election case, by the very nature of such proceeding, is not such as to foreclose all further dispute as to the existence, or non-existence of an employer-employee relationship" between SSI and private respondents herein.

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Magsino Labor Relations Digests, Arbues 2019 entertained, nor shall certification election be conducted, outside of the sixty-day freedom period immediately before the expiry date of the five-year term of the CBA.

G.R. No. 82341. December 6, 1989

SUNDOWNER Dev Corp v Drilon

EMPLOYMENT CONTRACTS AND COLLECTIVE BARGAINING AGREEMENTS; NOT ENFORCEABLE AGAINST A TRANSFEREE OF AN ENTERPRISE. —

REGISTRY OF UNIONS AND FILE OF COLLECTIVE AGREEMENTS; OFFICIAL FUNCTIONS PRESUMED REGULARLY PERFORMED.—

The rule is that unless expressly assumed, labor contracts such as employment contracts and collective bargaining agreements are not enforceable against a transferee of an enterprise, labor contracts being in personam, thus binding only between the parties. A labor contract merely creates an action in personam and does not create any real right which should be respected by third parties. This conclusion draws its force from the right of an employer to select his employees and to decide when to engage them as protected under our Constitution, and the same can only be restricted by law through the exercise of the police power.

Petitioner points out that the subject CBA was filed beyond the 30-day period prescribed under Article 231 of the Labor Code. It appears that the procedural requirement of filing the CBA within 30 days from date of execution under Article 231 was not met. The subject CBA was executed on November 28, 1989. It was ratified on December 8, 1989, and then 􀀼led with DOLE for registration purposes on March 14, 1990. Be that as it may, the delay in the filing of the CBA was sufficiently explained, i.e., there was an inter-union conflict on who would succeed to the presidency of ILO-PHILS. The CBA was registered by the DOLE only on May 4, 1990. It would be injudicious for us to assume, as what petitioner did, that the said CBA was filed only on April 30, 1990, as 5 days before its registration, on the unsupported surmise that it was done to suit the law that enjoins Regional Offices of DOLE to act upon an application for registration of a CBA within 5 days from its receipt thereof. In the absence of any substantial evidence that DOLE officials or personnel, in collusion with private respondent, had antedated the filing date of the CBA, the presumption on regularity in the performance of official functions holds. COLLECTIVE BARGAINING AGREEMENT; IMPORTANCE. —

GENERAL RULE THAT BONA FIDE PURCHASER OF ASSETS OF AN ONGOING CONCERN NOT REQUIRED TO ABSORB EMPLOYEES OF THE LATTER; EXCEPTION. — As a general rule, there is no law requiring a bona 􀀼de purchaser of assets of an on-going concern to absorb in its employ the employees of the latter. However, although the purchaser of the assets or enterprise is not legally bound to absorb in its employ the employers of the seller of such assets or enterprise, the parties are liable to the employees if the transaction between the parties is colored or clothed with bad faith. In the case at bar, contrary to the claim of the public respondent that the transaction between petitioner and Mabuhay was attended with bad faith, the court finds no cogent basis for such contention. Thus, the absorption of the employees of Mabuhay may not be imposed on petitioner.

Noncompliance with the procedural requirement of Article 231 should not adversely affect the substantive validity of the CBA between ILO-PHILS and the Transunion Corporation- Glassware Division covering the company's rank and file employees. A CBA is more than a contract. It is highly impressed with public interest for it is an essential instrument to promote industrial peace. Hence, it bears the blessings not only of the employer and employees concerned but even the DOLE. To set it aside on technical grounds is not conducive to the public good.

G.R. No. L-24711. April 30, 1968 BENGUET BCI EMPLOYEES & WORKERS UNION-PAFLU

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CONSOLIDATED

v

Magsino Labor Relations Digests, Arbues 2019 "PRINCIPLE OF SUBSTITUTION", MEANING OF. —

G.R. Nos. 58768-70. December 29, 1989. EMPLOYEES v LIBERTY FLOUR MILLS

The principle of substitution, formulated by the National Labor Relations Board, counterpart of our CIR, means that where there occurs a shift in employees' union allegiance after the execution of a collective bargaining contract with their employer, the employees can change their agent - the labor union, but the collective bargaining contract which is still subsisting, continues to bind the employees up to its expiration date. They may, however, bargain for the shortening of said expiration date. And the only consideration for the "substitutionary" doctrine is the employees' interest in the existing bargaining agreement; the agent's (Union's) interest never enters into the picture.

LIBERTY FLOUR MILLS

PRESIDENTIAL DECREE NO. 525; EMERGE ON ALLOWANCE; DEEMED ABSORBED BY THE WAGE INCREASE UNDER THE COLLECTIVE BARGAINING AGREEMENT; CASE AT BAR. — The Court holds that the emergency allowances are indeed absorbed by the wage increases required by P.D. 525 are indeed absorbed by the wage increases required under the Section 2 of the CBA. This is because Section 6 of the Interpretative Bulletin on LOI No. 174 specifically provides: Sec. 6. Allowances under LOI . — All allowances, bonuses, wage adjustments and other benefits given by employers to their employees shall be treated by the DOLE as in substantial compliance with the minimum standards set forth in LOI No. 174 if: (a) they conform with at least the minimum allowances scales specified in the immediately preceding Section ; and (b) they are given in response to the appeal of the President in his speech on 4 January 1974, or to countervail the quantum jump in the cost of living as a result of the energy crisis starting in November 1973, or pursuant to Presidential Decree No. 390; Provided, That the payment is retroactive to 18 February 1974 or earlier. The allowances and other benefits may be granted unilaterally by the employer or through collective bargaining, and may be paid at the same time as the regular wages of the employees. Allowances and other benefits which are not given in substantial compliance with the LOI as interpreted herein shall not be treated by the DOLE as emergency allowances in the contemplation of the LOI unless otherwise shown by sufficient proof. Thus, without such proof, escalation clauses in collective bargaining agreements concluded before the appeal of the President providing for automatic or periodic wage increases shall not be considered allowances for purposes of the LOI.

UNDER "SUBSTITUTIONARY DOCTRINE", EMPLOYEES CANNOT RENEGE ON THEIR COLLECTIVE BARGAINING CONTRACT; EXCEPTION. — The "Substitutionary doctrine" provides that the employees cannot revoke the validly executed collective bargaining contract with their employer by the simple expedient of changing their bargaining agent. The new agent must respect the contract. The employees, thru their new bargaining agent, cannot renege on the collective bargaining contract, except to negotiate with management for the shortening thereof. NEW COLLECTIVE BARGAINING AGENT DOES NOT AUTOMATICALLY ASSUME ALL PERSONAL UNDERTAKINGS OF DEPOSED UNION; SUBSTITUTIONARY DOCTRINE, HELD INAPPLICABLE. — The "Substitutionary doctrine" cannot be invoked to support the claim that a newly certified collective bargaining agent automatically assumes all personal undertakings, such as the no-strike stipulation in this case, assumed by the deposed union. When the BBWU bound itself and its officers not to strike, it could not bind all the rival unions because the BBWU was the agent only of the employees, not of the other unions which possess distinct personalities.

SECTION 5 OF ITS IMPLEMENTING RULES INTERPRETED. — The petitioners contend that the wage increases were the result of negotiation undertaken long before the promulgation of P.D. No. 525 and so should not be considered part of the emergency allowance decreed. In support of this contention, they cite Section 15 of the Rules implementing P.D. No. 525, providing as follows: Nothing herein shall prevent the employer and his employees, from entering into any agreement with terms more favorable to the employees than those provided herein, or be construed to sanction the diminution of any benefits granted to the employees under existing laws, agreements, and voluntary practice. Obviously, this section should not be read in isolation but must be related to the other sections

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Magsino Labor Relations Digests, Arbues 2019 above-quoted, to give effect to the intent and spirit of the decree. The meaning of the section simply is that any benefit over and above the prescribed allowances may still be agreed upon by the employees and the employer or, if already granted, may no longer be withdrawn or diminished.

self-organization, collective bargaining and negotiations and peaceful concerted actions including the right to strike in accordance with law." There is no question that these purposes could be thwarted if every worker were to choose to go his own separate way instead of joining his co-employees in planning collective action and presenting a united front when they sit down to bargain with their employers. It is for this reason that the law has sanctioned stipulations for the union shop and the closed shop as a means of encouraging the workers to join and support the labor union of their own choice as their representative in the negotiation of their demands and the protection of their interest vis-a-vis the employer.

COLLECTIVE BARGAINING AGREEMENTS; ENFORCES REGARDLESS OF ABSENCE OF CERTIFICATION BY THE BUREAU OF LABOR RELATIONS. — In its challenged decision, the public respondent held that in demanding the dismissal of Evaristo and Biascan, PLAC had acted prematurely because the 1974 CBA providing for union shop and pursuant to which the two petitioners were dismissed had not yet been certi􀀼ed. The implication is that it was not yet in effect and so could not be the basis of the action taken against the two petitioners. This conclusion is erroneous. It disregards the ruling of this Court in Tanduay Distillery Labor Union v. NLRC, were we held: The fact, therefore, that the BLR failed to certify or act on TDLU's request for certification of the CBA in question is of no moment to the resolution of the issues presented in this case. The BLR itself found in its order of July 8, 1982, that the "uncertified CBA was duly 􀀼led and submitted on October 29, 1980, to last until June 30, 1982 is certifiable for having complied with all the requirements for certification." The CBA concluded in 1974 was certifiable and was in fact certified on April 11, 1975. It bears stressing that Evaristo and Biascan were dismissed only on May 20, 1975, more than a month after the said certification. The correct view is that expressed by Commissioner Cecilio P. Seno in his concurring and dissenting opinion, viz.: . . . Evidence on record show that after the cancellation of the registration certificate of the Federation of Democratic Labor Unions, no other union contested the exclusive representation of the Philippine Labor Alliance Council (PLAC), consequently, there was no more legal impediment that stood on the way as to the validity and enforceability of the provisions of the CBA entered into by and between respondent corporation and respondent union. The certification of the collective bargaining agreement by the BLR is not required to put a stamp of validity to such contract. Once it is duly entered into and signed by the parties, a collective bargaining agreement becomes effective as between the parties regardless of whether or not the same has been certified by the BLR.

G.R. No. 102636. September 10, 1993 METROPOLITAN BANK & TRUST COMPANY EMPLOYEES UNIONALU- TUCP v NLRC "WAGE DISTORTION," DEFINED. — The term "wage distortion", under the Rules Implementing Republic Act 6727, is defined, thus: "(p) Wage Distortion means a situation where an increase in prescribed wage rates results in the elimination or severe contraction of intentional quantitative differences in wage or salary rates between and among employee groups in an establishment as to effectively obliterate the distinctions embodied in such wage structure based on skills, length of service, or other logical bases of differentiation."

The "intentional quantitative differences" in wage among employees of the bank has been set by the CBA to about P900 per month as of 01 January 1989. It is intentional as it has been arrived at through the collective bargaining process to which the parties are thereby concluded. The Solicitor General, in recommending the grant of due course to the petition, has correctly emphasized that the intention of the parties, whether the benefits under a collective bargaining agreement should be equated with those granted by law or not, unless there are compelling reasons otherwise, must prevail and be given effect.

POLICY OF THE STATE TO PROMOTE UNIONISM EXPLAINED. —

In keeping then with the intendment of the law and the agreement of the parties themselves, along with the often repeated rule that all doubts in the interpretation and implementation of labor laws should be resolved in favor of labor, we must approximate an acceptable quantitative difference between and among the CBA agreed work levels. We, however, do not subscribe to the labor arbiter's exacting prescription in correcting the wage distortion. Like the majority of the

It is the policy of the State to promote unionism to enable the workers to negotiate with management on the same level and with more persuasiveness than if they were to individually and independently bargain for the improvement of their respective conditions. To this end, the Constitution guarantees to them the rights "to

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Magsino Labor Relations Digests, Arbues 2019 members of the NLRC, we are also of the view that giving the employees an acrossthe-board increase of P750 may not be conducive to the policy of encouraging "employers to grant wage and allowance increases to their employees higher than the minimum rates of increases prescribed by statute or administrative regulation," particularly in this case where both RA 6727 and the CBA allow a credit for voluntary compliance. We 􀀼nd the formula suggested then by Commissioner BontoPerez, which has also been the standard considered by the Regional Tripartite Wages and Productivity Commission for the correction of pay scale structures in cases of wage distortion, to well be the appropriate measure to balance the respective contentions of the parties in this instance. We also view it as being just and equitable. G.R. No. 113856 September 7, 1998 SAMAHANG MANGGAGAWA SA TOP FORM MANUFACTURING UNITED WORKERS OF THE PHILIPPINES (SMTFM-UWP) v NLRC

CBA is proof enough that private respondent exerted "reasonable effort at good faith bargaining.

G.R. No. L-38258. November 19, 1982. LAKAS MANGGAGAWANG MAKABAYAN v MARCELO ENTERPRISES

NG

CERTIFICATION ELECTION; INDISPENSABLE WHERE THE ISSUE OF LEGITIMATE REPRESENTATION IS VIED BY TWO OR MORE LABOR ORGANIZATIONS; CASE AT BAR.—

There’s no wage distortion here nibba. WHERE A PROPOSAL RAISED BY A CONTRACTING PARTY DOES NOT FIND PRINT IN THE COLLECTIVE BARGAINING AGREEMENT, IT IS NOT A PART THEREOF AND THE PROPONENT HAS NO CLAIM WHATSOEVER TO ITS IMPLEMENTATION; CASE AT BAR. —

Where the issue of legitimate representation in dispute is vied for not only by one legitimate labor organization but two or more, there is every equitable ground warranting the holding of a certi􀀼cation election. In this way, the issue as to who is really the true bargaining representative of all the employees maybe 􀀼rmly settled by the simple expedient of an election." The cited case gives the reason for the need of determining once and for all the true choice of membership as to who should be their bargaining representative, which is that, "(E)xperience teaches us one of the root causes of labor or industrial disputes is the problem arising from a questionable bargaining representative entering into CBA concerning terms and conditions of employment."

The CBA is the law between the contracting parties — the collective bargaining representative and the employer-company. Compliance with a CBA is mandated by the expressed policy to give protection to labor. In the same vein, CBA provisions should be "construed liberally rather than narrowly and technically, and the courts must place a practical and realistic construction upon it, giving due consideration to the context in which it is negotiated and purpose which it is intended to serve." This is founded on the dictum that a CBA is not an ordinary contract but one impressed with public interest. It goes without saying, however, that only provisions embodied in the CBA should be so interpreted and complied with. Where a proposal raised by a contracting party does not And print in the CBA, it is not a part thereof and the proponent has no claim whatsoever to its implementation.

COLLECTIVE BARGAINING EMPLOYER'S RIGHT TO DEMAND OF THE ASSERTED BARGAINING AGENT PROOF OF ITS REPRESENTATIONS OF ITS EMPLOYEES. — Respecting the issue of representation and the right of the employer to demand reasonable proof of majority representation on the part of the supposed or putative bargaining agent, the commentaries in Rothenberg on Labor Relations, pp. 429- 431 are forceful and persuasive, thus : "It is essential to the right of a putative bargaining agent to represent the employees that it be the delegate of a majority of the employees and, conversely, an employer is under duty to bargain collectively only when the bargaining agent is representative of the majority of the employees. A natural consequences of these principles is that the employer has the right to demand of the asserted bargaining agent proof of its representation of its employees. Having the right to demonstration of this fact, it is not an 'unfair labor practice' for an

EXECUTION OF COLLECTIVE BARGAINING AGREEMENT IS PROOF OF GOOD FAITH BARGAINING; CASE AT BAR. — With the execution of the CBA, bad faith bargaining can no longer be imputed upon any of the parties thereto. All provisions in the CBA are supposed to have been jointly and voluntarily incorporated therein by the parties. This is not a case where private respondent exhibited an indifferent attitude towards collective bargaining because the negotiations were not the unilateral activity of petitioner union. The

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Magsino Labor Relations Digests, Arbues 2019 employer to refuse to negotiate until the asserted bargaining agent has presented reasonable proof of majority representation. It is necessary however that such demand be made in good faith and not merely as a pretext or device for delay or evasion. The employer's right is however to reasonable proof. . . . Although an employer has the undoubted right to bargain with a bargaining agent whose authority has been established, without the requirement that the bargaining agent be officially certified by the National Labor Relations Board as such, if the informally presented evidence leaves a real doubt as to the issue, the employer has a right to demand a certification and to refuse to negotiate until such official certification is presented.

It is the settled jurisprudence that it is an unfair labor practice for an employer not to reinstate, or re-employment to, members of union who abandon their strike and make unconditional offer to return to work. Exhibit "B" presents an unconditional offer of the striking employees to return to work under the same terms and conditions of employment before the strike. We find as a fact that the respondent Marcelo Companies did not refuse to reinstate or re-employ the strikers, as a consequence of which We overrule the finding of unfair labor practice against said companies based on the erroneous conclusion of the respondent court. It is clear from the records that even before the unconditional offer to return to work contained in Exhibit "B" was made, the respondent Marcelo Companies had already posted notices for the strikers to return back to work. It is true that upon their return, the striker were required to fill up a form (Exhibit "49") wherein they were to indicate the date of their availability for work. But We are more impressed and are persuaded to accept as true the contention of the respondent Marcelo Companies that the aforestated requirement was only for purposes of proper scheduling of the start of work for each returning striker. It must be noted that as a consequences of the two strikes which were both attended by widespread acts of violence and vandalism, the businesses of the respondent companies were completely paralyzed. It would hardly be justiciable to demand of the respondent companies to readmit all the returning workers in one big force or as each demanded readmission. There were machines that were not in operating condition because of long disuse during the strikes. Some of the machines needed more than one worker to operate them so that in the absence of the needed team of workers, the start of work by one without his teammates would necessarily be useless, and the company would be paying for his time spent doing no work. Finally, We take judicial cognizance of the fact that companies whose businesses were completely paralyzed by major strikes cannot resume operations at once and in the same state or force as before the strikes. But what strikes Us most in lending credence to respondents' allegation that Exhibit "49" was not meant to screen the strikers, is the fact that all of the returning strikers who filled up the form were scheduled for work and consequently started with their jobs. It is only those strikers who refused or failed to fill-up the required form, like the herein complaining employees, who were not scheduled for work and consequently have not been reemployed by the respondent Marcelo Companies. Even if there was a sincere belief on their part that the requirement of Exhibit "49" was a ruse at "screening" them is, this fear would have been dispelled upon notice of the fact that each and all of their co-strikers who filled up the required form were in fact scheduled for work and started to work. The stoppage of their work was not, therefore, the direct consequence of the respondent companies' complained act. Hence, their economic loss should not be shifted to the employer. In the light of the above ruling and taking the facts and circumstances of the case before Us in relation to the requirement by the respondent companies in the filling up of Exhibit

CONCERTED ACTIVITIES EXECUTED AND CARRIED INTO EFFECT AT THE INSTIGATION AND MOTIVATION OF A LABOR ORGANIZATION NOT A BARGAINING AGENT CONSTITUTE A VIOLATION OF EMPLOYER'S BASIC RIGHT TO BARGAIN COLLECTIVELY; CASE AT BAR. — The clear facts of the case as hereinbefore restated indisputably show that a legitimate representation issue confronted the respondent Marcelo Companies. In the face of these facts and in conformity with the existing jurisprudence, We hold that there existed on duty to bargain collectively with the complainant LAKAS on the part of said companies. And proceeding from this basis, it follows that all acts instigated by complainant LAKAS such as the filing of the Notice of Strike on June 13, 1967 (although later withdrawn) and the two strikes of September 4, 1967 and November 7, 1967 were calculated, designed and intended to compel the respondent Marcelo Companies to recognize or bargain with it notwithstanding that it was an uncertified union, or in the case of respondent Marcelo Tire and Rubber Corporation, to bargain with it despite the fact that the MUEWA of Paulino Lazaro was already certified as the sole bargaining agent in said respondent company. These concerted activities executed and carried into effect at the instigation and motivation of LAKAS are all illegal and violative of the employer's basic right to bargain collectively only with the representative supported by the majority of its employees in each of the bargaining units. This Court is not unaware of the present predicament of the employees involved but much as We sympathize with those who have been misled and so lost their jobs through hasty, ill-advised and precipitate moves, We rule that the facts neither substantiate nor support the finding that the respondent Marcelo Companies are guilty of unfair labor practice.

UNFAIR LABOR PRACTICE; REQUIREMENT TO FILL UP A FORM FOR SCHEDULING, NOT A REFUSAL TO REINSTATE OR RE-EMPLOY STRIKERS; CASE AT BAR. —

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Magsino Labor Relations Digests, Arbues 2019 "49", We hold and rule that the requirement was an act of self- preservation, designed to effect costsavings as well as to insure peace and order within their premises. Accordingly, the petition in G.R. No. L-38258 should be dismissed, it having failed to prove, substantiate and justify the unfair labor practice charges against the respondent Marcelo Companies.

demands shows that she did not refuse to bargain collectively with the complaining union. We can hardly dispute this finding, for it finds support in the evidence. The inference that respondents did not refuse to bargain collectively with the complaining union because they accepted some of the demands while they refused the others even leaving open other demands for future discussion is correct, especially so when those demands were discussed at a meeting called by respondents themselves precisely in view of the letter sent by the union on April 29, 1960. It is true that under Section 14 of Republic Act 875 whenever a party serves a written notice upon the employer making some demands the latter shall reply thereto not later than 10 days from receipt thereof, but this condition is merely procedural, and as much its noncompliance cannot be deemed to be an act of unfair labor practice. The fact is that respondents did not ignore the letter sent by the union so much so that they called a meeting to discuss its demands, as already stated elsewhere.

WORKER'S RIGHT TO SELF-ORGANIZATION; SUBJECT TO EMPLOYER'S FREEDOM TO ENFORCE RULES AND ORDERS NECESSARY TO THE PROPER CONDUCT OF HIS BUSINESS. — It was never the state policy nor Our judicial pronouncement that the employees' rights to self-organization and to engage in concerted activities for mutual aid and protection, are absolute or be upheld under all circumstances. The protection of workers' right to self-organization in no way interfere with employer's freedom to enforce such rules and orders as are necessary to proper conduct of his businesses, so long as employer's supervision is not for the purpose of intimidating or coercing his employees with respect to their self-organization and representation. It is the functions of the court to see that the rights of self-organization and collective bargaining guaranteed by the Act are amply secured to the employee, but in its effort to prevent the prescribed unfair labor practice, the court must be mindful of the welfare of the honest employer.

G.R. No. L-20044. April 30, 1964. RESTAURANT WORKERS (PTUC) v CIR

NATIONAL

UNION

It is contended that respondents refused to bargain with the complaining union as such even if they called a meeting of its officers and employees hereby concluding that they did not desire to enter into a bargaining agreement with said union. This conclusion has no rational relation with the main premise of the union for it is belied by the fact that respondents did actually agree and bargain with the representatives of the union. While it is true that respondents denied the capacity of the complaining union to bargain collectively with the respondents this is because they were of the impression that before a union could have that capacity it must first be certified by the CIR as the duly authorized bargaining unit, as in fact this is what they stated in their answer to the petition for certification filed by said union before the CIR. In said case, another union known as the International Labor and Marine Union of the Philippines claimed to represent the majority of the employees of respondent restaurant, and this is what it alleged in a letter sent to the manager of respondents dated May 25, 1962.

OF

There appears certain marks, opposite each demand, such as a check for those demands to which Mrs. Felisa Herrera was agreeable, a cross signifying the disapproval of Mrs. Herrera, and a circle regarding those demands which were left open for discussion on some future occasion that the parties may deem convenient. Such markings were made during the discussion of the demands in the meeting called by respondents on May 3, 1960 at their restaurant in Quezon City. The court a quo concluded that the fact that respondent Herrera had agreed to some of the

Kiok Loy v. National Labor Relations Commission, G.R. No. L-54334, January 22, 1986, 225 PHIL 138-147 Unfair labor practice is committed when it is shown that the respondent employer, after having been served with a written bargaining proposal by the petitioning Union, did not even bother to submit an answer or reply to the said

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Magsino Labor Relations Digests, Arbues 2019 proposal. While the law does not compel the parties to reach an agreement, it does contemplate that both parties will approach the negotiation with an open mind and make a reasonable effort to reach a common ground of agreement.

years, before the amendment of the law as far as the representation aspect is concerned. All other provisions of the CBA shall be negotiated not later than 3 years after its execution. The "representation aspect" refers to the identity and majority status of the union that negotiated the CBA as the exclusive bargaining representative of the appropriate bargaining unit concerned. "All other provisions" simply refers to the rest of the CBA, economic as well as non-economic provisions, except representation.

Neither are WE persuaded by petitioner-company's stand that the Collective Bargaining Agreement which was approved and adopted by the NLRC is a total nullity for it lacks the company's consent, much less its argument that once the Collective Bargaining Agreement is implemented, the Company will face the prospect of closing down because it has to pay a staggering amount of economic benefits to the Union that will equal if not exceed its capital. Such a stand and the evidence in support thereof should have been presented before the Labor Arbiter which is the proper forum for the purpose.

ARTICLE 253-A OF THE LABOR CODE, CONSTRUED. — The framers of the law wanted to maintain industrial peace and stability by having both management and labor work harmoniously together without any disturbance. Thus, no outside union can enter the establishment within 5 years and challenge the status of the incumbent union as the exclusive bargaining agent. Likewise, the terms and conditions of employment economic and non-economic) cannot be questioned by the employers or employees during the period of effectivity of the CBA. The CBA is a contract between the parties and the parties must respect the terms and conditions of the agreement. Notably, the framers of the law did not give a fixed term as to the effectivity of the terms and conditions of employment. It can be gleaned from their discussions that it was left to the parties to fix the period.

We agree with the pronouncement that it is not obligatory upon either side of a labor controversy to precipitately accept or agree to the proposals of the other. But an erring party should not be tolerated and allowed with impunity to resort to schemes feigning negotiations by going through empty gestures. More so, as in the instant case, where the intervention of the National Labor Relations Commission was properly sought for after conciliation efforts undertaken by the BLR failed. The instant case being a certified one, it must be resolved by the NLRC pursuant to the mandate of P.D. 873, as amended, which authorizes the said body to determine the reasonableness of the terms and conditions of employment embodied in any Collective Bargaining Agreement. To that extent, utmost deference to its findings of reasonableness of any Collective Bargaining Agreement as the governing agreement by the employees and management must be accorded due respect by this Court.

G.R. No. 111262. September 19, 1996 SAN EMPLOYEES UNION-PTGWO v Confesor

MIGUEL

COLLECTIVE BARGAINING AGREEMENT; TERM REPRESENTATION PROVISION IS THREE YEARS. —

OF

NON-

The issue as to the term of non-representation provisions of the CBA need not belabored especially when we take note of the Memorandum of the Secretary of Labor dated February 24, 1994 which was mentioned in the Resolution of Undersecretary Bienvenido Laguesma on January 16, 1995 in the certification election case involving the SMC employees. In said memorandum, the Secretary of Labor had occasion to clarify the term of the renegotiated terms of the CBA vis-a-vis the term of the bargaining agent, to wit: As a matter of policy the parties are encourages to enter into a renegotiated CBA with a term which would coincidde with the aforesaid 5 year term of the bargaining representative. In the event however, that the parties, by mutual agreement, enter into a renegotiated contract with a term of 3 years or one which does not coincide with the said 5-year term, and said agreement is ratified by majority of the members in the bargaining unit, the subject contract is valid and legal and therefore, binds the contracting parties. The same will however not adversely affect the right of another union to challenge the majority status of the incumbent bargaining agent within 60 days before the lapse of the original 5 year term of the CBA. Thus, we do not find any grave abuse of discretion on the part of

CORPORATION

TERM OF REPRESENTATION ASPECT FIXED TO FIVE YEARS; ALL OTHER ASPECTS, THREE YEARS. — Article 253-A is a new provision. This was incorporated by Section 21 of Republic Act No. 6715 (the Herrera-Veloso Law) which took effect on March 21, 1989. This new provision states that the CBA has a term of 5 years instead of 3

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Magsino Labor Relations Digests, Arbues 2019 the Secretary of Labor in ruling that the effectivity of the renegotiated terms of the CBA shall be for 3 years.

involved in the production of feeds and the processing of chicken. The nature of their products and scales of business may require different skills which must necessarily be commensurate by different compensation packages. The different companies may have different volumes of work and different working conditions. For such reason, the employees of the different companies see the need to group themselves together and organize themselves into distinctive and different groups. It would then be best to have separate bargaining units for the different companies where the employees can bargain separately according to their needs and according to their own working conditions.

OPERATING DIVISIONS OF THE COMPANY WHICH BECAME SEPARATE AND DISTINCT NO LONGER BELONG TO A SINGLE BARGAINING UNIT. — Ever mindful of the employees' interests, management has assured the concerned employees that they will be absorbed by the new corporations without loss of tenure and retaining their present pay and benefits according to the existing CBAs. They were advised that upon the expiration of the CBAs, new agreements will be negotiated between the management of the new corporations and the bargaining representatives of the employees concerned. Indubitably, therefore, Magnolia and SMFI became distinct entities with separate juridical personalities. Thus, they can not belong to a single bargaining unit as held in the case of Diatagon Labor Federation Local 110 of the ULGWP v. Ople. Petitioner-union's attempt to include the employees of Magnolia and SMFI in the SMC bargaining unit so as to have a bigger mass base of employees has, therefore, no more valid ground.

G.R. No. 91915. September 11, 1992 DIVINE WORD UNIVERSITY OF TACLOBAN v Secretary

TEST IN DETERMINING APPROPRIATE BARGAINING UNIT. — There are various factors which must be satisfied and considered in determining the proper constituency of a bargaining unit. No one particular factor is itself decisive of the determination. The weight accorded to any particular factor varies in accordance with the particular question or questions that may arise in a given case. What are these factors? Rothenberg mentions a good number, but the most pertinent to our case are: (1) will of the employees (Globe Doctrine); (2) affinity and unit of employees' interest, such as substantial similarity of work and duties, or similarity of compensation and working conditions; (3) prior collective bargaining history; and (4) employment status, such as temporary, seasonal and probationary employees.

On the issue of whether or not a certification election should have been ordered by the Secretary of Labor, pertinent are the following respective provisions of the Labor Code and Rule V, Book V of the Implementing Rules and Regulations of the same Code: "ART. 258. When an employer may file petition. — When requested to bargain collectively, an employer may petition the Bureau for an election. If there is no existing certified collective bargaining agreement in the unit, the Bureau shall, after hearing, order a certification election. All certification cases shall be decided within twenty (20) working days.

In determining an appropriate bargaining unit, the test of grouping is mutuality or commonality of interests. The employees sought to be represented by the collective bargaining agent must have substantial mutual interests in terms of employment and working conditions as evinced by the type of work they performed. Considering the spin-offs, the companies would consequently have their respective and distinctive concerns in terms of the nature of work, wages, hours of work and other conditions of employment. Interests of employees in the different companies perforce differ. SMC is engaged in the business of beer manufacturing. Magnolia is involved in the manufacturing and processing of dairy products while SMFI is

The Bureau shall conduct a certification election within twenty (20) days in accordance with the rules and regulations prescribed by the Secretary of Labor. Sec. 3. When to file. — In the absence of a collective bargaining agreement duly registered in accordance with Article 231 of the Code, a petition for certification election may be filed at any time. However, no certification election may be held within one year from the date of issuance of a final certification election result. Neither may a representation question be entertained if, before the filing of a petition

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Magsino Labor Relations Digests, Arbues 2019 for certification election, a bargaining deadlock to which an incumbent or certified bargaining agent is a party had been submitted to conciliation or arbitration or had become the subject of valid notice of strike or lockout. (Emphasis supplied)

"ART. 250. Procedure in collective bargaining. — The following procedures shall be observed in collective bargaining:chanrob1es virtual 1aw library

If a collective bargaining agreement has been duly registered in accordance with Article 231 of the Code, a petition for certification election or a motion for intervention can only be entertained within sixty (60) days prior to the expiry date of such agreement."

(a) When a party desires to negotiate an agreement, it shall serve a written notice upon the other party with a statement of its proposals. The other party shall make a reply thereto not later than ten (10) calendar days from receipt of such notice. (b) Should differences arise on the basis of such notice and reply, either party may request for a conference which shall begin not later than ten (10) calendar days from the date of request.

These provisions make it plain that in the absence of a collective bargaining agreement, an employer who is requested to bargain collectively may file a petition for certification election any time except upon a clear showing that one of these two instances exists: (a) the petition is filed within one year from the date of issuance of a final certification election result or (b) when a bargaining deadlock had been submitted to conciliation or arbitration or had become the subject of a valid notice of strike or lockout.

(c) If the dispute is not settled, the Board shall intervene upon request of either or both parties or at its own initiative and immediately call the parties to conciliation meetings. The Board shall have the power to issue subpoenas requiring the attendance of the parties to such meetings. It shall be the duty of the parties to participate fully and promptly in the conciliation meetings the Board may call;

While there is no question that the petition for certification election was filed by the herein petitioner after almost four years from the time of the certification election and, therefore, there is no question as to the timeliness of the petition, the problem appears to lie in the fact that the Secretary of Labor had found that a bargaining deadlock exists.

(d) During the conciliation proceedings in the Board, the parties are prohibited from doing any act which may disrupt or impede the early settlement of the disputes; and (e) The Board shall exert all efforts to settle disputes amicably and encourage the parties to submit their case to a voluntary arbitrator."

A "deadlock" is defined as the "counteraction of things producing entire stoppage: a state of inaction or of neutralization caused by the opposition of persons or of factions (as in government or a voting body): standstill." There is a deadlock when there is a "complete blocking or stoppage resulting from the action of equal and opposed forces; as, the deadlock of a jury or legislature. The word is synonymous with the word impasse which, within the meaning of the American federal labor laws, "presupposes reasonable effort at good faith bargaining which, despite noble intentions, does not conclude in agreement between the parties."

Considering the procedure outlined above, the Court cannot help but notice that the DWUEU was not entirely blameless in the matter of the delay in the bargaining process. While it is true that as early as March 7, 1985, said union had submitted its collective bargaining proposals and that, its subsequent withdrawal by the DWUEU Vice-President being unauthorized and therefore ineffective, the same proposals could be considered as subsisting, the fact remains that said union remained passive for three years. The records do not show that during this three-year period, it exerted any effort to pursue collective bargaining as a means of attaining better terms of employment.

A thorough study of the records reveals that there was no "reasonable effort at good faith bargaining" specially on the part of the University. Its indifferent attitude towards collective bargaining inevitably resulted in the failure of the parties to arrive at an agreement. As it was evident that unilateral moves were being undertaken only by the DWUEU-ALU, there was no "counteraction" of forces or an impasse to speak of. While collective bargaining should be initiated by the union, there is a corresponding responsibility on the part of the employer to respond in some manner to such acts. This is clear from the provisions of the Labor Code Art. 250(a) of which states:

It was only after its affiliation with the ALU that the same union, through the ALU Director for Operations, requested an "initial conference" for the purpose of collective bargaining. That the DWUEU abandoned its collective bargaining proposals prior to its affiliation with ALU is further confirmed by the fact that in the aforequoted May 10, 1988 agreement with the University, said Union bound itself to submit a new set of proposals on May 13, 1988. Under the circumstances, the

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Magsino Labor Relations Digests, Arbues 2019 agreement of May 10, 1988 may as well be considered the written notice to bargain referred to in the aforequoted Art. 250(a) of the Labor Code, which thereby set into motion the machinery for collective bargaining, as in fact, on May 19, 1988, DWUEU-ALU submitted its collective bargaining proposals.

Hence, petitioner’s contention that the DWUEU-ALU’s proposals may not be unilaterally imposed on it on the ground that a collective bargaining agreement is a contract wherein the consent of both parties is indispensable is devoid of merit. A similar argument had already been disregarded in the case of Kiok Loy v. NLRC, where we upheld the order of the NLRC declaring the union’s draft CBA proposal as the collective agreement which should govern the relationship between the parties. Kiok Loy v. NLRC is applicable in the instant case considering that the facts therein have also been indubitably established in this case. These factors are: (a) the union is the duly certified bargaining agent; (b) it made a definite request to bargain and submitted its collective bargaining proposals, and (c) the University made no counter proposal whatsoever. As we said in Kiok Loy," [a] company’s refusal to make counter proposal if considered in relation to the entire bargaining process, may indicate bad faith and this is especially true where the Union’s request for a counter proposal is left unanswered." Moreover, the Court added in the same case that "it is not obligatory upon either side of a labor controversy to precipitately accept or agree to the proposals of the other. But an erring party should not be tolerated and allowed with impunity to resort to schemes feigning negotiations by going through empty gestures."

Be that as it may, the Court is not inclined to rule that there has been a deadlock or an impasse in the collective bargaining process. As the Court earlier observed, there has not been a "reasonable effort at good faith bargaining" on the part of the University. While DWUEU-ALU was opening all possible avenues for the conclusion of an agreement, the record is replete with evidence on the University’s reluctance and thinly disguised refusal to bargain with the duly certified bargaining agent, such that the inescapable conclusion is that the University evidently had no intention of bargaining with it. Thus, while the Court recognizes that technically, the University has the right to file the petition for certification election as there was no bargaining deadlock to speak of, to grant its prayer that the herein assailed Orders be annulled would put an unjustified premium on bad faith bargaining. Bad faith on the part of the University is further exemplified by the fact that an hour before the start of the May 10, 1988 conference, it surreptitiously filed the petition for certification election. And yet during said conference, it committed itself to "sit down" with the Union. Obviously, the University tried to preempt the conference which would have legally foreclosed its right to file the petition for certification election. In so doing, the University failed to act in accordance with Art. 252 of the Labor Code which defines the meaning of the duty to bargain collectively as "the performance of a mutual obligation to meet and convene promptly and expeditiously in good faith." Moreover, by filing the petition for certification election while agreeing to confer with the DWUEU-ALU, the University violated the mandate of Art. 19 of the Civil Code that" (e)very person must, in the exercise of his rights and in the performance of his duties, act with justice, give everyone his due, and observe honesty and good faith."

That being the case, the petitioner may not validly assert that its consent should be a primordial consideration in the bargaining process. By its acts, no less than its inaction which bespeak its insincerity, it has forfeited whatever rights it could have asserted as an employer. We, therefore, find it superfluous to discuss the two other contentions in its petition.

G.R. No. 91231. February 4, 1991

NESTLE PHILIPPINES v NLRC

COLLECTIVE BARGAINING AGREEMENT (CBA); INCLUSION OF RETIREMENT PLAN IN THE CBA, GIVES A CONSENSUAL CHARACTER TO THE PLAN. —

Moreover, the University’s unscrupulous attitude towards the DWUEU-ALU is also betrayed by its belated questioning of the status of the said union. The communications between them afforded the University ample opportunity to raise the issue of representation if indeed it was doubtful of the DWUEU-ALU’s status as a majority union, but it failed to do so. On the other hand, in the agreement of May 10, 1988, the University even agreed "to sit down and determine the number of employees that will represent their bargaining unit." This clearly indicates that the University recognized the DWUEU-ALU as the bargaining representative of the employees and is, therefore, estopped from questioning the majority status of the said union.

The NLRC correctly observed that the inclusion of the retirement plan in the CBA as part of the package of economic benefits extended by the company to its employees to provide them a measure of financial security after they shall have ceased to be employed in the company, reward their loyalty, boost their morale and efficiency and promote industrial peace, gives "a consensual character" to the plan so that it may not be terminated or modified at will by either party. NON-CONTRIBUTORY OF RETIREMENT PLAN, DOES NOT MAKE IT A NON-ISSUE IN THE CBA NEGOTIATION. —

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Magsino Labor Relations Digests, Arbues 2019 withheld from him (which, as a rule, is from the time of his illegal dismissal) up to the time of his actual reinstatement.

The fact that the retirement plan is non-contributory, i.e., that the employees contribute nothing to the operation of the plan, does not make it a non-issue in the CBA negotiations. As a matter of fact, almost all of the benefits that the petitioner has granted to its employees under the CBA — salary increases, rice allowances, midyear bonuses, 13th and 14th month pay, seniority pay, medical and hospitalization plans, health and dental services, vacation, sick & other leaves with pay — are non-contributory bene􀀼ts. Since the retirement plan has been an integral part of the CBA since 1972, the Union's demand to increase the benefits due the employees under said plan, is a valid CBA issue. The deadlock between the company and the union on this issue was resolvable by the Secretary of Labor, or the NLRC, after the Secretary had assumed jurisdiction over the labor dispute (Art. 263).

The petitioner's contention, that employees have no vested or demandable right to a non-contributory retirement plan, has no merit for employees do have a vested and demandable right over existing benefits voluntarily granted to them by their employer. The latter may not unilaterally withdraw, eliminate or diminish such benefits.

Backwages to be awarded to an illegally dismissed employee, should not, as a general rule, be diminished or reduced by the earnings derived by him elsewhere during the period of his illegal dismissal. The underlying reason for this ruling is that the employee, while litigating the legality of his dismissal, must still earn a living to support himself and family, while full backwages have to be paid by the employer as part of the price or penalty he has to pay for illegally dismissing his employee. The clear legislative intent of the amendment in Rep. Act No. 6715 is to give more benefits to workers than was previously given them under the Mercury Drug rule or the "deduction of earnings elsewhere" rule. Thus, a closer adherence to the legislative policy behind Rep. Act No. 6715 points to "full backwages" as meaning exactly that, i.e., without deducting from backwages the earnings derived elsewhere by the concerned employee during the period of his illegal dismissal. In other words, the provision calling for "full backwages" to illegally dismissed employees is clear, plain and free from ambiguity and, therefore, must be applied without attempted or strained interpretation. Index animi sermo est.

G.R. No. 111651. November 28, 1996

G.R. No. 118651. October 16, 1997

EMPLOYEES HAVE VESTED AND DEMANDABLE RIGHT OVER EXISTING BENEFITS GRANTED BY EMPLOYER; NON-CONTRIBUTORY RETIREMENT PLAN, INCLUDED THEREIN. —

OSMALIK BUSTAMANTE v NLRC

Facts: On 15 March 1996, the Court (First Division) promulgated a decision in this case, the dispositive part of which states:

PIONEER TEXTURIZING v NLRC

Facts: Private respondent Lourdes A. de Jesus is petitioner’s reviser/trimmer since 1980. De Jesus received from petitioner’s personnel manager a memo requiring her to explain why no disciplinary action should be taken against her for dishonesty and tampering of official records and documents with the intention of cheating as P.O. No. 3853 allegedly required no trimming. The memo also placed her under preventive suspension for thirty days. In her handwritten explanation, de Jesus maintained that she merely committed a mistake and admitted that she may have been negligent but not for dishonesty or tampering. Petitioner’s personnel department, nonetheless, terminated her from employment and sent her a notice of termination dated September 18, 1992.

"WHEREFORE, the resolution of the NLRC dated 3 May 1993 is modified in that its deletion of the award for backwages in favor of petitioners, is SET ASIDE. The decision of the LA dated 26 April 1991 is AFFIRMED with the modification that backwages shall be paid to petitioners from the time of their illegal dismissal on 25 June 1990 up to the date of their reinstatement. If reinstatement s no longer feasible, a one-month salary shall be paid the petitioners as ordered in the labor arbiter's decision, in addition to the adjudged backwages.

On September 22, 1992, de Jesus filed a complaint for illegal dismissal against petitioners. Petitioners insist that the NLRC gravely abused its discretion in holding that de Jesus is entitled to reinstatement to her previous position for she was not illegally dismissed in the first place. In support thereof, petitioners quote portions of the NLRC decision which stated that petitioners cannot be entirely faulted for dismissing the complaint and that there was no illegal dismissal to speak of in the case at bar.

Issue: WON petitioners are entitled to recover backwages because they were not actually dismissed but their probationary employment was not converted to permanent employment. Held: Yes. In accordance with the above provision, an illegally dismissed employee is entitled to his full backwages from the time his compensation was

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Magsino Labor Relations Digests, Arbues 2019 Issue:

requirements of Article 224 were to govern, as we so declared in Maranaw, then the executory nature of a reinstatement order or award contemplated by Article 223 will be unduly circumscribed and rendered ineffectual. In enacting the law, the legislature is presumed to have ordaineda valid and sensible law, one which operates no further than may be necessary to achieve its specific purpose. Statutes, as a rule, are to be construed in the light of the purpose to be achieved and the evil sought to be remedied. And where statues are fairly susceptible of two or more construction, that construction should be adopted which will most tend to give effect to the manifest intent of the law maker and promote the object for which the statute was enacted, and a construction should be rejected which would tend to render abortive other provisions of the statute and to defeat the object which the legislator sought to attain by its enactment. In introducing a new rule on the reinstatement aspect of a labor decision under R.A. No. 6715, Congress should not be considered to be indulging in mere semantic exercise. On appeal, however, the appellate tribunal concerned may enjoin or suspend the reinstatement order in the exercise of its sound discretion.

WON reinstatement and backwages are due.

Held: Yes. Gleaned either from the LA observations or from the NLRCs assessment, it distinctly appears that petitioners accusation of dishonesty and tampering of official records and documents with intention of cheating against de Jesus was not substantiated by clear and convincing evidence. Petitioners simply failed, both before the Labor Arbiter and the NLRC, to discharge the burdent of proof and to validly justify de Jesus dismissal from service. The law, in this light, directs the employers, such as herein petitioners, not to terminate the services of an employee except for a just or authorized cause under the Labor Code.[8] Lack of a just cause in the dismissal from service of an employee, as in this case, renders the dismissal illegal, despite the employers observance of procedural due process.[9] And while the NLRC stated that there was no illegal dismissal to speak of in the case at bar and that petitioners cannot be entirely faulted therefor, said statements are inordinate pronouncements which did not remove the assailed dismissal from the realm of illegality. Neither can these pronouncements preclude us from holding otherwise. Corollary to our determination that de Jesus was illegally dismissed is her imperative entitlement to reinstatement and backwages as mandated by law. Issue: WON order for reinstatement requires motion for execution.

G.R. No. 74531 June 28, 1988

Held: No. Article 224 states that the need for a writ of execution applies only within 5 years from the date a decision, an order or awards becomes final and executory. It cannot relate to an award or order of reinstatement still to be appealed or pending appeal which Article 223 contemplates. The provision of Article 223 is clear that an award for reinstatement shall be immediately executory even pending appeal and the posting of a bond by the employer shall not stay the execution for reinstatement.

PIZZA INN v NLRC

Facts: Before the expiration of the 6-month probationary period, Felicidad Fontanilla resigned. Claiming that she was forced to resign by the petitioner, the former filed a complaint against the latter. Petitioner appealed from the decision of the LA favoring private respondent. Petitioner's appeal was dismissed by the NLRC. The case was elevated to SC but also with no favorable result. Due to the finality of the judgment in this case, the LA issued a second alias Writ of Execution dated September 8, 1984 against petitioner wherein the amount involved (representing backwages of private respondent among others, from April 24, 1982 to September 30, 1984) amounted to P29,001.00 as per computation of the Socio-Economic Analyst of the Commission. Petitioner filed a Motion to Recompute and to quash/stay writ of execution, notice of garnishment under supersedeas bond on October 19, 1984.

The legislative content is quite obvious, i.e., to make an award of reinstatement immediately enforceable, even pending appeal. To require the application for and issuance of a writ of execution as prerequisites for the execution of a reinstatement award would certainly betray and run counter to the very object and intent of Article 223, i. e., the immediate execution of a reinstatement order. The reason is simple. An application for a writ of execution and its issuance could be delayed for numerous reasons. A mere continuance or postponement of a scheduled hearing, for instance, or an inaction on the part of the Labor Arbiter or the NLRC could easily delay the issuance of the writ thereby setting at naught the strict mandate and noble purpose envisioned by Article 223. In other words, if the

Issue: May an employer be ordered to reinstate private respondent after the closure of its branch or outlet where private respondent was employed, and to pay private respondent back wages even after the date of closure and continuously without limit considering that there was no way to reinstate the workers anymore?

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Magsino Labor Relations Digests, Arbues 2019 Strained relations must be of such a nature or degree as to preclude reinstatement. But, where the differences between the parties are neither personal nor physical, nor serious, then there is no reason why the illegally dismissed employee should not be reinstated rather than simply given separation pay and backwages. More so if the cause of the perceived 'strained relations' is the filing of a complaint for illegal dismissal.

Held: No. Reinstatement became a legal impossibility due to the fact that Pizza-In closed its business in 1984 due to financial losses. However, she is entitled to damages. It is on record that the Socio-Economic Analyst of the public respondent computed that award of P29,001.00 covering the period from April, 1982 to September, 1984, which amount complainant admittedly received after the NLRC Sheriff garnished from the amount deposited at the Philippine Commercial and International Bank despite the pendency of petitioner's appeal questioning the order of the Labor Arbiter's denial of petitioner's Motion to Recompute and to Quash/Stay Writ of Execution/Notice of Garnishment under Supersedeas Bond.

Whatever resentments had been harbored by petitioner upon her unceremonious dismissal after having been employed by St. Joseph School for more than 16 years is understandable. Such resentments, however, would not suffice to deny her reemployment because to do so would render for naught her constitutional right to security of tenure and her corollary right to reinstatement under Article 279. Petitioner is, after all, a permanent teacher as she had rendered more than three years of satisfactory service.

Computing backwages beyond January 1984, the date of closure, would not only be unjust but confiscatory as well as violative of the Constitution depriving the petitioner of his property rights. The unlimited award would not only prejudice the herein petitioner but would, as well, impose a crushing financial burden on the already financially distressed petitioner corporation. The fact that the computation of the backwages was done ex-parte without giving petitioner a chance or opportunity to comment on said computation is clearly a denial of due process. G.R. No. 101427 November 8, 1993

*Computing award for backwages Closely related to the right to reinstatement is the employee's right to receive backwages which represent the compensation that an unjustly dismissed employee should have received had said employee not be dismissed. Petitioner claims that she is entitled to full backwages (computed from the date of dismissal until actual reinstatement) under Article 279. This contention, however, is not supported by prevailing jurisprudence which limits the award of backwages to 3 years without qualification and deduction.

CONSUELO KUNTING v NLRC

Facts: Consuelo B. Kunting was employed as a teacher by respondent St. Joseph School in Gov. Camins Avenue, Zamboanga City. School did not renew her employment contract for the school year 1988-89, thereby terminating her employment with the school. The termination letter was dated April 4, 1988.

While RA 6715 amending Sec. 279 grants full backwages to dismissed employees computed from the date of their illegal dismissal up to the date of actual reinstatement, the same cannot be applied in the case at bar. This is because petitioner was illegally dismissed on April 4, 1988, or before the effectivity of R.A. 6715 on March 21, 1989. In Lantion v. NLRC (181 SCRA 513 [1990]), We held that nothing in R.A. 6715 provides for its retroactive application. Necessarily, awards of backwages in cases of illegal dismissal initiated before the effectivity of R.A. 6715 will have to be resolved by applying the three-year limit formulated in the case of Mercury, Drug v. CIR.

The LA held that there was illegal dismissal and awarded separation pay in lieu of reinstatement due to strained relations. However, the NLRC modified the grant of 6 months backwages and ordered instead the payment of backwages without qualification and deduction, computed from the date of promulgation of its decision. Issue:

WON separation pay may be awarded in lieu of reinstatement.

Held: Not in this case. An illegally dismissed employee's right to reinstatement is not absolute. In the case at bar, however, the peculiar circumstances surrounding the dismissal of petitioner simply do not show such kind of strained relationship as to warrant the severance of the working relationship between the parties.

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G.R. No. 114250 April 5, 1995

only exacerbate the animosities that have developed between the parties, the public respondents were correct in ordering instead the grant of separation pay to the dismissed employees in the interest of industrial peace.

DOMINICO CONGSON v NLRC

Facts: Petitioner is the registered owner of Southern Fishing Industry. Private respondents were hired on various dates by petitioner’s as regular piece-rate workers. They were uniformly paid at a rate of P1.00 per tuna weighing 30 to 80 kilos per movement. During the first week of June 1990, petitioner notified his workers of his proposal to reduce the rate-per-tuna movement due to the scarcity of tuna. Private respondents resisted petitioner's proposed rate reduction. When they reported for work the next day, they were informed that they had been replaced by a new set of workers, When they requested for a dialogue with the management, they were instructed to wait for further notice. They waited for the notice of dialogue for a full week but in vain. They filed a case for constructive dismissal and separation pay. LA ruled in favor of respondents. Issue:

G.R. No. 152308. January 26, 2005

ACESITE CORPORATION v NLRC

Facts: Gonzales was a security guard. After exhausting his paid vacation and sick leaves, he filed for an emergency leave which was not approved. However, he did not report for work thus was asked to file a written letter requiring explanation. He explained that he was recovering from stomach disorder and needed to go home to Abra. On May 7, 1998, he received a letter (sent on May 5) requiring him to report back to work. He reported on May 8 but was barred from entering the premises because petitioner issued a termination letter through an inter-office memo. Issue: WON reinstatement should be made.

WON separation pay may be awarded in lieu of reinstatement.

Held: Yes. . As a permissible exception to the general rule, separation pay may be awarded to the employee in lieu of reinstatement, by reason of strained relationship between the employer and employee. Firstly, petitioner consistently refused to re-admit private respondents in his establishment. Petitioner even replaced private respondents with a new set of workers to perform the tasks of private respondents; Moreover, although petitioner ostensibly argued in his supplemental motion for reconsideration that reinstatement should have been the proper remedy in the case at bench on his premise that the existence of strained relationship was not adequately established, yet petitioner never sincerely intended to effect the actual reinstatement of private respondents. For if petitioner were to pursue further the entire logic of his argument, the prayer in his supplemental motion for reconsideration should have contained not just the mere deletion of the award of separation pay, but precisely, the reinstatement of private respondents. Quite obviously then, notwithstanding petitioner's argument for reinstatement he was only interested in the deletion of the award of separation pay to private respondents.

Held: No. In illegal dismissal cases, reinstatement to an illegally dismissed employees former position may be excused on the ground of strained relations. This may be invoked against employees whose positions demand trust and confidence, or whose differences with their employer are of such nature or degree as to preclude reinstatement. In the case at bar, Gonzales was Chief of Security, whose duty was to manage the operation of the security areas of the hotel to provide and ensure the safety and security of the hotel guests, visitors, management, staff and their properties according to company policies and local laws. It cannot be gainsaid that Gonzales position is one of trust and confidence, he being in charge of the over-all security of said hotel. Thus, reinstatement is no longer possible. In lieu thereof, Acesite is liable to pay separation pay of 1 month for every year of service.

And secondly, private respondents themselves, from the very start, had already indicated their aversion to their continued employment in petitioner's establishment. The very filing of the case for separation pay. It appears that relations between the petitioner and the complainants have been so strained that the complainants are no longer willing to be reinstated. As such reinstatement would

As to the award of moral and exemplary damages, this Court finds it unwarranted. Moral damages are recoverable only where the dismissal of the employees was attended by bad faith or fraud or constituted an act oppressive to

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Magsino Labor Relations Digests, Arbues 2019 labor or was done in a manner contrary to morals, good customs or public policy. Exemplary damages on the other hand may be awarded only if the dismissal was effected in a wanton, oppressive or malevolent manner. Though these grounds have been alleged by Gonzales, they were not sufficiently proven.

government must still perform its function and apply the law, especially if, as in this case, national interest is involved. It is, therefore, evident from the foregoing that the Secretary’s subsequent order for mere payroll reinstatement constitutes grave abuse of discretion amounting to lack or excess of jurisdiction. Indeed, this Court has always recognized the "great breadth of discretion" by the Secretary once he assumes jurisdiction over a labor dispute. However, payroll reinstatement in lieu of actual reinstatement is a departure from the rule in these cases and there must be showing of special circumstances rendering actual reinstatement impracticable, as in the UST case aforementioned, or otherwise not conducive to attaining the purpose of the law in providing for assumption of jurisdiction by the Secretary of Labor and Employment in a labor dispute that affects the national interest. None appears to have been established in this case. Even in the exercise of his discretion under Article 236(g), the Secretary must always keep in mind the purpose of the law. Time and again, this Court has held that when an official by-passes the law on the asserted ground of attaining a laudable objective, the same will not be maintained if the intendment or purpose of the law would be defeated.

G.R. No. 140518 December 16, 2004 MANILA DIAMOND HOTEL EMPLOYEES’ UNION v CA

G.R. No. 152329. April 22, 2003 ALEJANDRO ROQUERO v PAL

Facts: On November 29, 1997, the Union staged a strike against the Hotel. Numerous confrontations between the two parties followed, creating an obvious strain between them. The Hotel claims that the strike was illegal and it had to dismiss some employees for their participation in the allegedly illegal concerted activity. The Union, on the other hand, accused the Hotel of illegally dismissing the workers. The secretary of labor ordered a payroll reinstatement but the hotel refused. Issue:

Facts: Petitioner was a mechanic for PAL. He got caught using shabu inside the airport. On March 30, 1994, Roquero received a notice of administrative charge for violating the PAL Code of Discipline. They were required to answer the charges and were placed under preventive suspension. Roquero in his reply to notice of administrative charge, assailed his arrest and asserted that he was instigated by PAL to take the drugs. He argued that he was instigated by the airport manager. He based his argument on the fact that the manager was not arrested even though they were together at the time of the crime.

WON strained relations warrants payroll reinstatement.

Held: No. A strained relationship between the striking employees and management is no reason for payroll reinstatement in lieu of actual reinstatement. Petitioner correctly points out that labor disputes naturally involve strained relations between labor and management, and that in most strikes, the relations between the strikers and the non-strikers will similarly be tense. Bitter labor disputes always leave an aftermath of strong emotions and unpleasant situations. Nevertheless, the

The NLRC ruled in favor of complainants as it likewise found PAL guilty of instigation. It ordered reinstatement to their former positions but without backwages. Complainants filed a motion for a writ of execution of the order of reinstatement. The LA granted the motion but PAL refused to execute the said order on the ground that they have filed a Petition for Review before CA. CA reversed the decision of the NLRC and upheld the dismissal of Roquero. However, it denied the

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Magsino Labor Relations Digests, Arbues 2019 award of separation pay and attorneys fees to Roquero on the ground that one who has been validly dismissed is not entitled to those benefits. Issue:

Issue:

Effect of dismissal for just cause but lack due process.

Held: As Assistant Vice-President of Citibanks Treasury Department, Genuino was tasked to solicit investments, and peso and dollar deposits for, and keep them in Citibank; and to sell and/or push for the sale of Citibanks financial products, such as the MBS, for the account and benefit of Citibank. She held a position of trust and confidence. There is no way she could deny any knowledge of the banks policies nor her understanding of these policies as reflected in the survey done by the bank. All the pieces of evidence compel us to conclude that Genuino did not have her employers interest. All told, Citibank had valid grounds to dismiss Genuino on ground of loss of confidence. In view of Citibanks failure to observe due process, however, nominal damages are in order but the amount is hereby raised to P30k pursuant to Agabon v. NLRC.

WON order of reinstatement is immediately executor.

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

If the decision of the LA is later reversed on appeal upon the finding that the ground for dismissal is valid, then the employer has the right to require the dismissed employee on payroll reinstatement to refund the salaries s/he received while the case was pending appeal, or it can be deducted from the accrued benefits that the dismissed employee was entitled to receive from his/her employer under existing laws, collective bargaining agreement provisions, and company practices. However, if the employee was reinstated to work during the pendency of the appeal, then the employee is entitled to the compensation received for actual services rendered without need of refund.

IN VIEW WHEREOF, the dismissal of petitioner Roquero is AFFIRMED, but respondent PAL is ordered to pay the wages to which Roquero is entitled from the time the reinstatement order was issued until the finality of this decision.

MARILOU GENUINO v NLRC G.R. Nos. 142732-33 December 4, 2007

JUANITO GARCIA v PAL

Facts: On August 23, 1993, Citibank sent Genuino (a treasurer) a letter charging her with knowledge and/or involvement in transactions which were irregular or even fraudulent. In the same letter, Genuino was informed she was under preventive suspension. On September 13, 1993, Citibank sent another letter demanding explanation in writing 3 days from her receipt hereof why her employment should not be terminated in view of her involvement in irregular transactions. She was also directed to appear in an administrative investigation. Despite this, petitioner did not appear nor submit a written explanation. Genuinos employment was terminated.

Facts: The case stemmed from the administrative charge filed by PAL against its employees-herein petitioners after they were allegedly caught in the act of sniffing shabu when a team of company security personnel and law enforcers raided PAL. After due notice, PAL dismissed petitioners on October 9, 1995 for transgressing the PAL Code of Discipline, prompting them to file a complaint for illegal dismissal and damages which was, by Decision of January 11, 1999, resolved by the LA in their favor, thus ordering PAL to, inter alia, immediately comply with the reinstatement aspect of the decision. During this time, PAL was placed under Permanent Rehabilitation.

LA held that the dismissal was without just cause and failed to comply with administrative due process. NLRC modified judgment holding the dismissal as valid but ordered Citibank to pay the salaries due to the complainant from the date it reinstated complainant in the payroll (computed at P60k a month, as found by the LA) up to and until the date of this decision.

G.R. No. 164856 January 20, 2009

CA reversed LA on 2 grounds: (1) a subsequent finding of a valid dismissal removes the basis for implementing the reinstatement aspect of LA decisio, and (2) the impossibility to comply with the reinstatement order due to corporate rehabilitation provides a reasonable justification for the failure to exercise the options under Article 223.

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Magsino Labor Relations Digests, Arbues 2019 installment by the employer. For in the event of a reversal of the Labor Arbiters decision ordering reinstatement, the employer gets back the same amount without having to spend ordinarily for bond premiums. This circumvents, if not directly contradicts, the proscription that the posting of a bond [even a cash bond] by the employer shall not stay the execution for reinstatement.

Issue: WON subsequent finding of valid dismissal render order of reinstatement nugatory. Held: No. The social justice principles of labor law outweigh or render inapplicable the civil law doctrine of unjust enrichment.

The rule to be followed is the 1st one. The Court reaffirms the prevailing principle that even if the order of reinstatement of the Labor Arbiter is reversed on appeal, it is obligatory on the part of the employer to reinstate and pay the wages of the dismissed employee during the period of appeal until reversal by the higher court. It settles the view that the Labor Arbiter's order of reinstatement is immediately executory and the employer has to either re-admit them to work under the same terms and conditions prevailing prior to their dismissal, or to reinstate them in the payroll, and that failing to exercise the options in the alternative, employer must pay the employee’s salaries

There are 2 views regarding this matter. The 1 st view is Even if the order of reinstatement of the LA is reversed on appeal, it is obligatory on the part of the employer to reinstate and pay the wages of the dismissed employee during the period of appeal until reversal by the higher court. On the other hand, if the employee has been reinstated during the appeal period and such reinstatement order is reversed with finality, the employee is not required to reimburse whatever salary he received for he is entitled to such, more so if he actually rendered services during the period. In other words, a dismissed employee whose case was favorably decided by the Labor Arbiter is entitled to receive wages pending appeal upon reinstatement, which is immediately executory. Unless there is a restraining order, it is ministerial upon the Labor Arbiter to implement the order of reinstatement and it is mandatory on the employer to comply therewith.

Issue:

WON Rehabilitation bars reinstatement.

Held: Yes. After the labor arbiters decision is reversed by a higher tribunal, the employee may be barred from collecting the accrued wages, if it is shown that the delay in enforcing the reinstatement pending appeal was without fault on the part of the employer.

The 2nd view is espoused in the case of Genuino. If the decision of the labor arbiter is later reversed on appeal upon the finding that the ground for dismissal is valid, then the employer has the right to require the dismissed employee on payroll reinstatement to refund the salaries s/he received while the case was pending appeal, or it can be deducted from the accrued benefits that the dismissed employee was entitled to receive from his/her employer under existing laws, collective bargaining agreement provisions, and company practices. However, if the employee was reinstated to work during the pendency of the appeal, then the employee is entitled to the compensation received for actual services rendered without need of refund.

The test is two-fold: (1) there must be actual delay or the fact that the order of reinstatement pending appeal was not executed prior to its reversal; and (2) the delay must not be due to the employers unjustified act or omission. If the delay is due to the employers unjustified refusal, the employer may still be required to pay the salaries notwithstanding the reversal of the Labor Arbiters decision. It is settled that upon appointment by the SEC of a rehabilitation receiver, all actions for claims before any court, tribunal or board against the corporation shall ipso jure be suspended. As stated early on, during the pendency of petitioners complaint before the Labor Arbiter, the SEC placed respondent under an Interim Rehabilitation Receiver. After the Labor Arbiter rendered his decision, the SEC replaced the Interim Rehabilitation Receiver with a Permanent Rehabilitation Receiver.

Prior to Genuino, there had been no known similar case containing a dispositive portion where the employee was required to refund the salaries received on payroll reinstatement. In fact, in a catena of cases, the Court did not order the refund of salaries garnished or received by payroll-reinstated employees despite a subsequent reversal of the reinstatement order. The dearth of authority supporting Genuino is not difficult to fathom for it would otherwise render inutile the rationale of reinstatement pending appeal.

Case law recognizes that unless there is a restraining order, the implementation of the order of reinstatement is ministerial and mandatory. This injunction or suspension of claims by legislative fiat partakes of the nature of a restraining order that constitutes a legal justification for respondents non-compliance

The Genuino ruling not only disregards the social justice principles behind the rule, but also institutes a scheme unduly favorable to management. Under such scheme, the salaries dispensed pendente lite merely serve as a bond posted in

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Magsino Labor Relations Digests, Arbues 2019 with the reinstatement order. Respondents failure to exercise the alternative options of actual reinstatement and payroll reinstatement was thus justified. Such being the case, respondents obligation to pay the salaries pending appeal, as the normal effect of the non-exercise of the options, did not attach.

dismissal was performed. But while the Labor Code treats of the nature of, and the remedy available as regards the first — the employee's separation from employment — it does not at all deal with the second — the manner of that separation — which is governed exclusively by the Civil Code. In addressing the first issue, the Labor Arbiter applies the Labor Code; in addressing the second, the Civil Code. And this appears to be the plain and patent intendment of the law. For apart from the reliefs expressly set out in the Labor Code flowing from illegal dismissal from employment, no other damages may be awarded to an illegally dismissed employee other than those specified by the Civil Code. Hence, the fact that the issue-of whether or not moral or other damages were suffered by an employee and in the affirmative, the amount that should properly be awarded to him in the circumstances-is determined under the provisions of the Civil Code and not the Labor Code, obviously was not meant to create a cause of action independent of that for illegal dismissal and thus place the matter beyond the Labor Arbiter's jurisdiction.

In sum, the obligation to pay the employee’s salaries upon the employers failure to exercise the alternative options under Article 223 of the Labor Code is not a hard and fast rule, considering the inherent constraints of corporate rehabilitation.

G.R. No. 72644 December 14, 1987

Thus, an employee who has been illegally dismissed causing him to suffer moral damages (as determined by the Civil Code), has a cause of action for reinstatement and recovery of back wages and damages. When he institutes proceedings before the Labor Arbiter, he should make a claim for all said reliefs. He cannot be permitted to prosecute his claims piecemeal. He cannot institute proceedings separately and contemporaneously in a court of justice upon the same cause of action or a part thereof. He cannot and should not be allowed to sue in two forums: one, before the Labor Arbiter for reinstatement and recovery of back wages, or for separation pay, upon the theory that his dismissal was illegal; and two, before a court of justice for recovery of moral and other damages, upon the theory that the manner of his dismissal was unduly injurious, or tortious. This is what in procedural law is known as splitting causes of action, engendering multiplicity of actions.

ALFREDO PRIMERO v IAC

Facts: Since August 1, 1974, appellee's bus dispatcher did not assign any bus to be driven by appellant Primero. No reason or cause was given by the dispatcher to appellant for not assigning a bus to the latter for 23 days. On the 23rd day, appellant was told to look for another job. He filed a case for illegal dismissal, and for recovery of back wages and reinstatement. Later on, he withdraw his case to file a damage suit with a civil court. On August 11, 1980 the Trial Court rendered judgment dismissing the complaint on the ground of lack of jurisdiction, for the reason that at the time that the complaint was filed. on August 17, 1978, the law — the Labor Code as amended by PD 1367, eff. May 1, 1978 — conferred exclusive, original jurisdiction over claims for moral or other damages, not on ordinary courts, but on Labor Arbiters. Issue:

It is against such mischiefs that the Labor Code amendments just discussed are evidently directed, and it is such duplicity which the Rules of Court regard as ground for abatement or dismissal of actions, constituting either litis pendentia (auter action pendant) or res adjudicata, as the case may be. But this was precisely what Primero's counsel did. He split Primero's cause of action; and he made one of the split parts the subject of a cause of action before a court of justice. Consequently, the judgment of the Labor Arbiter granting Primero separation pay operated as a bar to his subsequent action for the recovery of damages before the Court of First Instance under the doctrine of res judicata, The rule is that the prior "judgment or order is, with respect to the matter directly adjudged or as to any other matter that could have been raised in relation thereto, conclusive between the parties and their successors in interest by title subsequent to the commencement of the action or special proceeding, litigating for the same thing and under the same title and in the same capacity.

WON Civil Courts may entertain suits for damages arising from EER.

Held: No. It is clear that the question of the legality of the act of dismissal is intimately related to the issue of the legality of the manner by which that act of

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Magsino Labor Relations Digests, Arbues 2019 The legislative intent appears clear to allow recovery in proceedings before LA of moral and other forms of damages, in all cases or matters arising from EER. This would no doubt include, particularly, instances where an employee has been unlawfully dismissed. In such a case, the LA has jurisdiction to award to the dismissed employee not only the reliefs specifically provided by labor laws, but also moral and other forms of damages governed by the Civil Code. *Moral damages

G.R. No. 78345 September 21, 1990

Moral damages would be recoverable, for example, where the dismissal of the employee was not only effected without authorized cause and /or due process for which relief is granted by the Labor Code but was attended by bad faith or fraud, or constituted an act oppressive to labor, or was done in a manner contrary to morals good customs or public policy for which the obtainable relief is determined by the Civil Code (not the Labor Code). Stated otherwise, if the evidence adduced by the employee before the Labor Arbiter should establish that the employer did indeed terminate the employee's services without just cause or without according him due process, the Labor Arbiter's judgment shall be for the employer to reinstate the employee and pay him his backwages or, exceptionally, for the employee simply to receive separation pay. These are reliefs explicitly prescribed by the Labor Code. But any award of moral damages by the Labor Arbiter obviously cannot be based on the Labor Code but should be grounded on the Civil Code.

JOSE M. MAGLUTAC v NLRC

Facts: On October 3, 1984, Manager Maglutac received a notice of termination. The notice of termination reads: You are hereby notified and advised that the Board of Directors of this Corporation, acting on the unanimous resolution, have decided that your continued employment in this company, will not be in the best interest of the corporation. The termination of your services is without prejudice to any future action, private or legal, that the Company may take to demand restitution, enforce collection or require repayment of whatever financial obligations you now have incurred, to the company.

Moral damages may be awarded to compensate one for diverse injuries such as mental anguish, besmirched reputation, wounded feelings and social humiliation. It is however not enough that such injuries have arisen; it is essential that they have sprung from a wrongful act or omission of the defendant which was the proximate cause thereof.

It turns out that the company lost trust and confidence on Maglutac because his family established a company that directly competes with Commart. LA ruled that there was illegal dismissal and Maglutac must be reinstated with full backwages. The NLRC affirmed the finding of the Labor Arbiter that complainant was illegally dismissed by Commart but it deleted the award for moral and exemplary damages in favor of complainant and absolved Jesus T. Maglutac from any personal liability to the complainant. Issue:

*Exemplary damages The complainant was dismissed without due process. His dismissal was made effective immediately and he was not given an opportunity to present his side. Where the employee's dismissal was effected without procedural fairness, an award of exemplary damages in her favor can only be justified if her dismissal was affected in a wanton, oppressive or malevolent manner

WON Maglutac is entitled to damages.

Held: Yes. NLRC held that his dismissal was not merely without just cause but was also an act of vendetta, malice attended the act thus, he is entitled to moral and exemplary damages under the Civil Code.

We agree however, with the contention of the Solicitor General that the award by the Labor Arbiter of P 200,000.00 moral damages and P20,000.00 exemplary damages is excessive, In the exercise of our discretion, We reduce the

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Magsino Labor Relations Digests, Arbues 2019 award of damages to P40,000.00 as moral damages and P10,000.00 as exemplary damages.

G.R. No. 118746 September 7, 1995

represented by petitioner in the labor dispute to acquire what they have not been receiving under the law and to alleviate their living condition, the reduction of petitioner's contingent fee is proper. Labor cases, it should be stressed, call for compassionate justice. Furthermore, petitioner's contingent fee falls within the purview of Article 111 of the Labor Code. This article fixes the limit on the amount of attorney's fees which a lawyer, like petitioner, may recover in any judicial or administrative proceedings since the labor suit where he represented private respondents asked for the claim and recovery of wages. In fact, We are not even precluded from fixing a lower amount than the ten percent ceiling prescribed by the article when circumstances warrant it. Nonetheless, considering the circumstances and the able handling of the case, petitioner's fee need not be further reduced.

ATTY. TAGANAS v NLRC

Facts: Petitioner Atty. Taganas represented herein private respondents in a labor suit conditioned upon a contingent fee arrangement granting the equivalent of 50% of the judgment award plus three P300 appearance fee per hearing. The LA ruled in favor of private respondents. This decision was appealed by Ultra and PTSI to the NLRC but to no avail. During the execution stage of the decision, petitioner moved to enforce his attorney's charging lien. Private respondents, aggrieved for receiving a reduced award due to the attorney's charging lien, contested the validity of the contingent fee arrangement they have with petitioner.

*Rule if the client failed to dispute excessive contingent fee The contingent fee contract being unreasonable and unconscionable the same was correctly disallowed by public respondent NLRC even with respect to the four private respondents who agreed to pay higher percentage. Petitioner is reminded that as a lawyer he is primarily an officer of the court charged with the duty of assisting the court in administering impartial justice between the parties. When he takes his oath, he submits himself to the authority of the court and subjects his professional fees to judicial control. G.R. No. 79907 March 16, 1989 SAMUEL CASAS LIM v NLRC

Finding the arrangement excessive, the Labor Arbiter ordered the reduction of petitioner's contingent fee from fifty percent of the judgment award to ten percent. Issue:

Facts: Respondent Victoria Calsado tried to resign from her position in Sweet Lines but she was persuaded not to. Relations began to sour later, however, when she repeatedly asked for payment of her commissions, which had accumulated and were long overdue. She was terminated.

WON the reduction of petitioner's contingent fee is warranted.

Held: Yes. A contingent fee arrangement is an agreement laid down in an express contract between a lawyer and a client in which the lawyer's professional fee, usually a fixed percentage of what may be recovered in the action is made to depend upon the success of the litigation. This arrangement is valid in this jurisdiction. It is, however, under the supervision and scrutiny of the court to protect clients from unjust charges. Section 13 of the Canons of Professional Ethics states that "a contract for a contingent fee, where sanctioned by law, should be reasonable under all the circumstances of the case including the risk and uncertainty of the compensation, but should always be subject to the supervision of a court, as to its reasonableness"

Issue:

WON separation pay must be awarded.

Held: Yes. Separation pay is granted where reinstatement is no longer advisable because of strained relations between the employee and the employer. Back wages represent compensation that should have been earned but were not collected because of the unjust dismissal. The bases for computing the two are different, the first being usually the length of the employee's service and the second the actual period when he was unlawfully prevented from working.

The financial capacity and economic status of the client have to be taken into account in fixing the reasonableness of the fee. Noting that petitioner's clients were lowly janitors who receive miniscule salaries and that they were precisely

We have ordered the payment of both in proper case as otherwise the employee might be deprived of benefits justly due him. Thus, if an employee who

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Magsino Labor Relations Digests, Arbues 2019 has worked only one year is sustained by the labor court after three years from his unjust dismissal, granting him separation pay only would entitle him to only one month salary. There is no reason why he should not also be paid three years back wages corresponding to the period when he could not return to his work or could not find employment elsewhere.

to dismissal but may be allowed separation pay since his conduct, while inept, is not depraved. But if he was in fact not really sleeping but sleeping with a prostitute during his tour of duty and in the company premises, the situation is changed completely. This is not only inefficiency but immorality and the grant of separation pay would be entirely unjustified. *Separation pay as measure of social justice Separation pay shall be allowed as a measure of social justice only in those instances where the employee is validly dismissed for causes other than serious misconduct or those reflecting on his moral character. Where the reason for the valid dismissal is, for example, habitual intoxication or an offense involving moral turpitude, like theft or illicit sexual relations with a fellow worker, the employer may not be required to give the dismissed employee separation pay, or financial assistance, or whatever other name it is called, on the ground of social justice.

G.R. No. 83234 April 18, 1989

OSIAS ACADEMY v DOLE A contrary rule would, as the petitioner correctly argues, have the effect of rewarding rather than punishing the erring employee for his offense. The policy of social justice is not intended to countenance wrongdoing simply because it is committed by the underprivileged.

Facts: The award by the respondent Minister of Labor 1 of separation pay, on grounds of equity, to two employees of petitioner Osias Academy despite the avowedly correct grant of clearance to it to terminate the services of said employees on the ground of loss of confidence based on a satisfactory showing of embezzlement of company funds, serious misconduct, etc., is challenged in the special civil action of certiorari at bar. Issue: WON separation pay may be awarded.

ALAN GUSTILO v WYETH PHILIPPINES G.R. No. 149629 October 4, 2004

Held: No. There should be no question that where it comes to such valid but not iniquitous causes as failure to comply with work standards, the grant of separation pay to the dismissed employee may be both just and compassionate, particularly if he has worked for some time with the company. It is not the employee's fault if he does not have the necessary aptitude for his work but on the other hand the company cannot be required to maintain him just the same at the expense of the efficiency of its operations. He too may be validly replaced. Under these and similar circumstances, however, the award to the employee of separation pay would be sustainable under the social justice policy even if the separation is for cause.

Facts: Gustilo was employed by Wyeth Philippines, Inc., respondent company, as a pharmaceutical territory manager. Petitioners employment records show that respondent company, on various dates, reprimanded and suspended him for habitually neglecting to submit his periodic reports. Petitioner submitted to respondent company a plan of action where he committed to make an average of 18 daily calls to physicians; submit promptly all periodic reports; and ensure 95% territory program performance for every cycle. However, petitioner failed to achieve the above objectives, prompting respondent company to send him 2 separate notices dated February 20, 1996 and April 10, 1996, charging him with willful violation of company rules and regulations and directing him to submit a written explanation. On May 22, 1996, he was terminated.

But where the cause of the separation is more serious than mere inefficiency, the generosity of the law must be more discerning. There is no doubt it is compassionate to give separation pay to a salesman if he is dismissed for his inability to fill his quota but surely he does not deserve such generosity if his offense is misappropriation of the receipts of his sales. This is no longer mere incompetence but clear dishonesty. A security guard found sleeping on the job is doubtless subject

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Magsino Labor Relations Digests, Arbues 2019 NLRC ordered reinstatement or in lieu therof, separation pay. CA held that dismissal was valid but awarded him separation pay considering the mitigating factors of length of service, the loyalty awards he received. Issue:

NLRC held DBP liable for unpaid wages of private respondents "not as a majority stockholder of respondent PSC, but as the foreclosing creditor who possesses the assets of said PSC by virtue of the auction sale it held in 1987." In addition, the NLRC held that the labor arbiter is correct in assuming jurisdiction because "the worker's preference to the amount secured by DBP by virtue of said foreclosure sales of PSC properties arose out of or are connected or interwoven with the labor dispute brought forth by appellees against PSC and DBP.

WON separation pay shall be awarded.

Held: No. The general rule is separation pay shall not be awarded if there’s a valid dismissal. In the case at bar, we find no exceptional circumstances to warrant the grant of financial assistance or separation pay to petitioner. It bears stressing that petitioner did not only violate company disciplinary rules and regulations. As found by the CA, he falsified his employment application form by not stating therein that he is the nephew of Mr. Danao, respondent Wyeths Nutritional Territory Manager. Also, on February 2, 1993, he was suspended for falsifying a gasoline receipt. On June 28, 1993, he was warned for submitting a false report of his trade outlet calls. On September 8, 1993, he was found guilty of unauthorized availment of sick, vacation and emergency leaves. These infractions manifest his slack of moral principle. In simple term, he is dishonest.

Issue:

Held: No. During the dates material to the foregoing proceedings, Article 110 of the Labor Code read: Art. 110.Worker preference in case of bankruptcy. — In the event of bankruptcy or liquidation of an employer's business, his workers shall enjoy first preference as regards wages due them for services rendered during the period prior to the bankruptcy or liquidation, any provision of law to the contrary notwithstanding. Unpaid wages shall be paid in full before other creditors may establish any claim to a share in the assets of the employer.

Financial assistance may be allowed as a measure of social justice in exceptional circumstances and as an equitable concession. We are likewise mindful that financial assistance is allowed only in those instances where the employee is validly dismissed for causes other than serious misconduct or those reflecting on his moral character.

G.R. No. 86932 June 27, 1990

WON a foreclosing creditor is liable for unpaid wages.

It is quite clear from the provisions that a declaration of bankruptcy or a judicial liquidation must be present before the worker's preference may be enforced. The claims of all creditors whether preferred or non- preferred, the Identification of the preferred ones and the totality of the employer's asset should be brought into the picture. There can then be an authoritative, fair, and binding adjudication instead of the piece meal settlement which would result from the questioned decision in this case.

DBP v and DOROTHY S. ANCHETA

Facts: Philippine Smelter Corporation mortgaged its assets with DBP. PSC failed to pay the loan thus there was extrajudicial foreclosure.

Republic Act No. 6715, which took effect on March 21, 1989, amended Article 110 of the Labor Code to read as follows:

On February 10, 1987, 40 petitioners filed a Petition for Involuntary Insolvency against PSC and DBP, impleading as co-respondents therein Jose Panganiban Ice Plant and Cold Storage et al.

Art. 110.Worker preference in case of bankruptcy. — In the event of bankruptcy or liquidation of an employer's business, his workers shall enjoy first preference as regards their unpaid wages and other monetary claims, any provision of law to the contrary notwithstanding. Such unpaid wages and monetary claims shall be paid in full before the claims of the Government and other creditors may be paid.

On February 13, 1987, herein private respondents filed a complaint with the DOL(E) against PSC and DBP for nonpayment of salaries, 13th month pay, incentive leave pay and separation pay. DBP filed its position paper on September 7, 1987, invoking the absence of EER between private respondents and DBP and submitting that when DBP foreclosed the assets of PSC, it did so as a foreclosing creditor.

Despite said amendments, however, the same interpretation of Article 110 as applied in the aforesaid case of Development Bank of the Philippines vs. Hon. Labor Arbiter Ariel C. Santos, et al., supra, was adopted by this Court in the recent

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Magsino Labor Relations Digests, Arbues 2019 case of Development Bank of the Philippines vs. National Labor Relations Commission, et. al., For facility of reference, especially the rationalization for the conclusions reached therein, we reproduce the salient portions of the decision in this later case.

insolvent's assets. It is a right to a first preference in the discharge of the funds of the judgment debtor. Article 110 of the Labor Code does not purport to create a lien in favor of workers or employees for unpaid wages either upon all of the properties or upon any particular property owned by their employer. Claims for unpaid wages do not therefore fall at all within the category of specially preferred claims established under Articles 2241 and 2242 of the Civil Code, except to the extent that such claims for unpaid wages are already covered by Article 2241, number 6: 'claims for laborers' wages, on the goods manufactured or the work done; or by Article 2242, number 3: 'claims of laborers and other workers engaged in the construction, reconstruction or repair of buildings, canals and other works, upon said buildings, canals or other works.' To the extent that claims for unpaid wages fall outside the scope of Article 2241, number 6 and Article 2242, number 3, they would come within the ambit of the category of ordinary preferred credits under Article 2244.'

Notably, the terms "declaration" of bankruptcy or "judicial" liquidation have been eliminated but liquidation proceedings is still needed. 1. Because of its impact on the entire system of credit, Article 110 of the Labor Code cannot be viewed in isolation but must be read in relation to the Civil Code scheme on classification and preference of credits. 2. In the same way that the Civil Code provisions on classification of credits and the Insolvency Law have been brought into harmony, so also must the kindred provisions of the Labor Law be made to harmonize with those laws. 3. In the event of insolvency, a principal objective should be to effect an equitable distribution of the insolvent's property among his creditors. To accomplish this there must first be some proceeding where notice to all of the insolvent's creditors may be given and where the claims of preferred creditors may be bindingly adjudicated. 1989).

5. The DBP anchors its claim on a mortgage credit. A mortgage directly and immediately subjects the property upon which it is imposed, whoever the possessor may be, to the fulfillment of the obligation for whose security it was constituted (Article 2176, Civil Code). It creates a real right which is enforceable against the whole world. It is a lien on an Identified immovable property, which a preference is not. A recorded mortgage credit is a special preferred credit under Article 2242 (5) of the Civil Code on classification of credits. The preference given by Article 110, when not falling within Article 2241 (6) and Article 2242 (3) of the Civil Code and not attached to any specific property, is an ordinary preferred credit although its impact is to move it from second priority to first priority in the order of preference established by Article 2244 of the Civil Coe.

A preference of credit bestows upon the preferred creditor an advantage of having his credit satisfied first ahead of other claims which may be established against the debtor. Logically, it becomes material only when the properties and assets of the debtors are insufficient to pay his debts in full; for if the debtor is amply able to pay his various creditors, in full, how can the necessity exist to determine which of his creditors shall be paid first or whether they shall be paid out of the proceeds of the sale of the debtor's specific property? Indubitably, the preferential right of credit attains significance only after the properties of the debtor have been inventoried and liquidated, and the claims held by his various creditors have been established.

In fact, under the Insolvency Law (Section 29) a creditor holding a mortgage or hen of any kind as security is not permitted to vote in the election of the assignee in insolvency proceedings unless the value of his security is first fixed or he surrenders all such property to the receiver of the insolvent's estate.

4. A distinction should be made between a preference of credit and a lien. A preference applies only to claims which do not attach to specific properties. A hen creates a charge on a particular property. The right of first preference as regards unpaid wages recognize by Article 110 does not constitute a hen on the property of the insolvent debtor in favor of workers. It is but a preference of credit in their favor, a preference in application. It is a method adopted to determine and specify the order in which credits should be paid in the final distribution of the proceeds of the

6. Even if Article 110 and its Implementing Rule, as amended, should be interpreted to mean 'absolute preference,' the same should be given only prospective effect in line with the cardinal rule that laws shall have no retroactive effect, unless the contrary is provided (Article 4, Civil Code). Thereby, any infringement on the constitutional guarantee on non-impairment of obligation of contracts (Section 10, Article III, 1987 Constitution) is also avoided. In point of fact, DBP's mortgage credit antedated by several years the amendatory law, RA No. 6715. To give Article 110 retroactive effect would be to wipe out the mortgage in DBPs favor and expose

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Magsino Labor Relations Digests, Arbues 2019 it to a risk which it sought to protect itself against by requiring a collateral in the form of real property.

its implementing rule cannot be invoked by the respondents in this case absent a formal declaration of bankruptcy or a liquidation order.

In fine, the right to preference given to workers under Article 110 of the Labor Code cannot exist in any effective way prior to the time of its presentation in distribution proceedings. It will find application when, in proceedings such as insolvency, such unpaid wages shall be paid in full before the 'claims of the Government and other creditors' may be paid. But, for an orderly settlement of a debtor's assets, all creditors must be convened, their claims ascertained and inventoried, and thereafter the preference determined in the course of judicial proceedings which have for their object the subjection of the property of the debtor to the payment of his debts or other lawful obligations. Thereby, an orderly determination of preference of creditors' claims is assured; the adjudication made will be binding on all parties-in-interest, since those proceedings are proceedings in rem; and the legal scheme of classification, concurrence and preference of credits in the Civil Code, the Insolvency Law, and the Labor Code is preserved in harmony.

Art. 110, which was amended by R.A. 6715 effective 21 March 1989, now reads: Art. 110.Worker preference in case of bankruptcy. — In the event of bankruptcy or liquidation of an employer's business, his workers shall enjoy first preference as regards their unpaid wages and other monetary claims, any provision of law to the contrary notwithstanding. Such unpaid wages and monetary claims shall be paid in full before the claims of the Government and other creditors may be paid. Obviously, the amendment expanded the concept of "worker preference" to cover not only unpaid wages but also other monetary claims to which even claims of the Government must be deemed subordinate. The Rules and Regulations Implementing R.A. 6715, approved 24 May 1989, also amended the corresponding implementing rule, and now reads:

On the foregoing considerations and it appearing that an involuntary insolvency proceeding has been instituted against PSC, private respondents should properly assert their respective claims in said proceeding.

G.R. No. 108031 March 1, 1995

Sec. 10. Payment of wages and other monetary claims in case of bankruptcy. — In case of bankruptcy or liquidation of the employer's business, the unpaid wages and other monetary claims of the employees shall be given first preference and shall be paid in full before the claims of government and other creditors may be paid.

DBP v NLRC and LEONOR ANG

Although the terms "declaration" (of bankruptcy) or "judicial" (liquidation) have been notably eliminated, this Court did not alter its original position that the right to preference given to workers under Art. 110 cannot exist in any effective way prior to the time of its presentation in distribution proceedings.

Facts: Ang was Executive Secretary with Tropical Philippines Wood Industries, Inc. (TPWII) when DBP foreclosed the latter. On 14 December 1987 aggrieved by the termination of her employment, private respondent filed with the Labor Arbiter a complaint for separation pay, 13th month pay, vacation and sick leave pay, salaries and allowances against TPWII, its General Manager, and petitioner.

Worker preference will find application when, in proceedings such as insolvency, such unpaid wages shall be paid in full before the "claims of the Government and other creditors" may be paid. But, for an orderly settlement of a debtor's assets, all creditors must be convened, their claims ascertained and inventoried, and thereafter the preferences determined. In the course of judicial proceedings which have for their object the subjection of the property of the debtor to the payment of his debts or other lawful obligations. Thereby, an orderly determination of preference of creditors' claims is assured; the adjudication made will be binding on all parties-in-interest since those proceedings are proceedings in rem; and the legal scheme of classification, concurrence and preference of credits in the Civil Code, the Insolvency Law, and the Labor Code is preserved in harmony

Issue: WON Art. 110 of the Labor Code, as amended, which refers to worker preference in case of bankruptcy or liquidation of an employer's business is applicable to the present case notwithstanding the absence of any formal declaration of bankruptcy or judicial liquidation of TPWII. Held: A declaration of bankruptcy or a judicial liquidation must be present before the worker's preference may be enforced. Thus, Article 110 of the Labor Code and

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Magsino Labor Relations Digests, Arbues 2019 1. When directors and trustees or, in appropriate cases, the officers of a corporation — (a) vote for or assent to patently unlawful acts of the corporation; (b) act in bad faith or with gross negligence in directing the corporate affairs; (c) are guilty of conflict of interest to the prejudice of the corporation, its stockholders or members, and other persons. 2. When a director or officer has consented to the issuance of watered stocks or who, having knowledge thereof, did not forthwith file with the corporate secretary his written objection thereto. 3. When a director, trustee or officer has contractually agreed or stipulated to hold himself personally and solidarily liable with the Corporation. 4 When a director, trustee or officer is made, by specific provision of law, personally liable for his corporate action.

A preference of credit bestows upon the preferred creditor an advantage of having his credit satisfied first ahead of other claims which may be established against the debtor. Logically, it becomes material only when the properties and assets of the debtors are insufficient to pay his debts in full; for if the debtor is amply able to pay his various creditors in full, how can the necessity exist to determine which of his creditors shall be paid first or whether they shall be paid out of the proceeds of the sale of the debtor's specific property. Indubitably, the preferential right of credit attains significance only after the properties of the debtor have been inventoried and liquidated, and the claims held by his various creditors have been established. A preference applies only to claims which do not attach to specific properties. A lien creates a charge on a particular property. The right of first preference as regards unpaid wages recognized by Article 110 does not constitute a lien on the property of the insolvent debtor in favor of workers. It is but a preference of credit in their favor, a preference in application. It is a method adopted to determine and specify the order in which credits should be paid in the final distribution of the proceeds of the insolvent's assets. It is a right to a first preference in the discharge of the funds of the judgment debtor.

In labor cases, for instance, the Court has held corporate directors and officers solidarily liable with the corporation for the termination of employment of employees done with malice or in bad faith. In the case at Bench, there is nothing substantial on record that can justify, prescinding from the foregoing, petitioner Centeno's solidary liability with the corporation.

In the present case, there is as yet no declaration of bankruptcy nor judicial liquidation of TPWII. Hence, it would be premature to enforce the worker's preference. G.R. No. 114787 June 2, 1995

MAM REALTY v NLRC G.R. No. 70615 October 28, 1986 VIRGILIO CALLANTA v Carnation Phils

Facts: The case originated from a complaint filed with the Labor Arbiter by private respondent Celso B. Balbastro against herein petitioners, MAM Realty Development Corporation and its Vice President Manuel P. Centeno, for wage differentials et al. Issue:

Facts: On June 1, 1979, respondent filed with MOLE an application for clearance to terminate the employment of Virgilio Callanta on the alleged grounds of serious misconduct and misappropriation of company funds amounting to P12k. On July 5, 1982, Virgilio Callanta filed with the MOLE a complaint for illegal dismissal. In its position paper dated October 5, 1982, respondent Carnation put in issue the timeliness of petitioner's complaint alleging that the same is barred by prescription for having been filed more than 3 years after the date of Callanta's dismissal.

WON Centeno is jointly and severally liable.

Held: No. A corporation, being a juridical entity, may act only through its directors, officers and employees. Obligations incurred by them, acting as such corporate agents, are not theirs but the direct accountabilities of the corporation they represent. True, solidary liabilities may at times be incurred but only when exceptional circumstances warrant such as, generally, in the following cases:

Issue: WON an action for illegal dismissal prescribes in 3 years pursuant to Articles 291 and 292.

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Magsino Labor Relations Digests, Arbues 2019 Held: No. 4-year prescriptive period under Article 1146 of the New Civil Code, applies by way of supplement, in the instant case. One's employment, profession, trade or calling is a "property right," and the wrongful interference therewith is an actionable wrong. The right is considered to be property within the protection of a constitutional guaranty of due process of law. Clearly then, when one is arbitrarily and unjustly deprived of his job or means of livelihood, the action instituted to contest the legality of one's dismissal from employment constitutes, in essence, an action predicated "upon an injury to the rights of the plaintiff," as contemplated under Art. 1146 of the New Civil Code, which must be brought within 4 years.

recover damages as redress for defendant's breach of his contractual obligation to plaintiff who was damaged and prejudiced. The Court believes such cause of action is within the realm of civil law, and jurisdiction over the controversy belongs to the regular courts. Issue: WON RTC has jurisdiction. Held: No. Labor Code is even more committed to the view that on policy grounds, and equally so in the interest of greater promptness in the disposition of labor matters, a court is spared the often onerous task of determining what essentially is a factual matter, namely, the damages that may be incurred by either labor or management as a result of disputes or controversies arising from employer-employee relations.

In the instant case, the action for illegal dismissal was filed by petitioners on July 5, 1982, or 3 years, 1 month and 5 days after the alleged effectivity date of his dismissal on June 1, 1979 which is well within the 4-year prescriptive period under Article 1146 of the New Civil Code.

This is, of course, to distinguish from cases of actions for damages where the EER is merely incidental and the cause of action proceeds from a different source of obligation. Thus, the jurisdiction of regular courts was upheld where the damages, claimed for were based on tort, malicious prosecution, or breach of contract, as when the claimant seeks to recover a debt from a former employee or seeks liquidated damages in enforcement of a prior employment contract.

Even on the assumption that an action for illegal dismissal falls under the category of "offenses" or "money claims" under Articles 291 and 292, Labor Code, which provide for a three-year prescriptive period, still, a strict application of said provisions will not destroy the enforcement of fundamental rights of the employees. As a statutory provision on limitations of actions, Articles 291 and 292 go to matters of remedy and not to the destruction of fundamental rights. As a general rule, a statute of limitation extinguishes the remedy only. Although the remedy to enforce a right may be barred, that right may be enforced by some other available remedy which is not barred.

G.R. No. 128024. May 9, 2000

Neither can we uphold the reasoning of respondent court that because the resolution of the issues presented by the complaint does not entail application of the Labor Code, the dispute is intrinsically civil. Article 217(a) bestows upon the LA original and exclusive jurisdiction over claims for damages arising from EER. LA has jurisdiction to award not only the reliefs provided by labor laws, but also damages governed by the Civil Code.

BEBIANO BAEZ v HON. VALDEVILLA

G. R. No. 143215. July 11, 2002

Facts: Petitioner was the sales operations manager of Oro Marketing. Oro indefinitely suspended Baez. LA ruled in favor of petitioner while NLRC dismissed the appeal for being filed out of time. Thereafter, Oro filed a complaint for damages before the RTC. Petitioner filed a motion to dismiss arguing that the action for damages, having arisen from an EER, was squarely under the exclusive original jurisdiction of the NLRC under Article 217(a), paragraph 4 and is barred by reason of the final judgment in the labor case.

SOLIMAN SECURITY SERVICES v CA

Facts: Respondent Valenzuela was a security guard until he was relieved with promise to be reassigned. Valenzuela then filed a case for constructive dismissal with payment for overtime et al, arguing that he was put on a floating status. Petitioner in its answer alleged that Valenzuela refused the reassignment and the 29 days of floating status was not tantamount to constructive dismissal. LA ruled in favor of respondent. On appeal, petitioner failed to post the appeal bond. Regardless, NLRC gave due course to the appeal upon the petitioner’s submission of a manifestation and affidavit.

RTC dismissed the motion to dismiss because a perusal of the complaint which is for damages does not ask for any relief under the Labor Code. It seeks to

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Magsino Labor Relations Digests, Arbues 2019 Issue:

WON non-posting of bond warrants dismissal of appeal.

bond was later discovered to be spurious because the person who signed it was no longer connected with the insurance company for more than 10 years already. It was only on July 20, 1993, that private respondents posted a substitute bond issued by another company.

Held: Yes. Private respondent would posit that the appeal of petitioners to the NLRC should be considered to have been made on 19 January 1999 (when petitioner submitted, pursuant to the NLRC order, a statement under oath to the effect that the surety bond it had posted was genuine and confirmed it to be in effect until the final termination of the case) which was beyond the ten-day period for perfecting an appeal. The records before the Court would show, however, that an appeal bond was posted with the NLRC at the same time that the appeal memorandum of petitioners was filed on 16 October 1998. A certified true copy of the appeal bond would indicate that it was received by the Commission on 16 October 1998, the date reflected by the stamp-mark thereon. The surety bond issued by the Philippine Charter Insurance Corporation bore the date of 14 October 1998 or two days before the appeal memorandum was seasonably filed on 16 October 1998. The Order, dated 11 November 1998, of the NLRC categorically stated that records would disclose that the instant appeal was accompanied by a surety bond, as the Decision sought to be appealed involved a monetary award. The NLRC, in fact, ordered petitioner to submit an affidavit to confirm that its appeal bond was genuine and would be in force and effect until the final disposition of the case. The Commissions declaration that the appeal was accompanied by a surety bond indicated that there had been compliance with Article 223 of the Labor Code.

Issue: WON THE LA DECISION HAS BECOME FINAL FOR NON-FILING OF A SUPERSEDEAS BOND WITHIN THE REGLEMENTARY PERIOD. Held: Yes. The perfection of an appeal within the reglementary period and in the manner prescribed by law is jurisdictional, and noncompliance with such legal requirement is fatal and has the effect of rendering the judgment final and executory. Such requirement cannot be trifled with. Perfection of an appeal includes the filing, within the prescribed period, of the memorandum of appeal containing, among others, the assignment of error/s, the relief sought and, posting of the appeal bond. In case where the judgment involves a monetary award, as in this case, the appeal may be perfected only upon posting of a cash or surety bond issued by a reputable bonding company duly accredited by the NLRC. The amount of the bond must be equivalent to the monetary award, exclusive of moral and exemplary damages and attorney's fees. The records indicate that private respondents received the copy of labor arbiter's decision on April 3, hence, they had only until April 13 to perfect their appeal. While private respondents filed their memorandum of appeal on time, they posted surety bond only on April 30, which is beyond the ten-day reglementaty period. Private respondents' failure to post the required appeal bond within the prescribed period is inexcusable. Worse, the appeal bond was bogus having been issued by an officer no longer connected with the bonding company, which was not sufficiently explained by private respondents. For sure, they cannot avoid responsibility by disavowing any knowledge of its fictitiousness for they were required to secure bond only from reputable companies. Corollary, they should have ensured that the bond is genuine, otherwise, the purpose of requiring the posting of bond, that is, to guarantee the payment of valid and legal claims against the employer, would not be served.

An appeal to the NLRC is perfected once an appellant files the memorandum of appeal, pays the required appeal fee and, where an employer appeals and a monetary award is involved, the latter posts an appeal bond or submits a surety bond issued by a reputable bonding company. In line with the desired objective of labor laws to have controversies promptly resolved on their merits, the requirements for perfecting appeals are given liberal interpretation and construction. G.R. No. 116464

March 1, 2000

RODENTO NAVARRO v NLRC

Facts: Petitioners are jeepney drivers on a boundary system. The dispatcher, told the petitioners cannot go out on the usual working hours of 5 PM to 4 AM (night shift) because their working hours were moved to a new schedule of work, 7 PM to 6 AM. Petitioners did not ply their route as protest. Petitioners were dismissed.

We are mindful of the fact that this Court, in a number of cases, has relaxed this requirement on grounds of substantial justice and special circumstances of the case. However, we find no cogent reason to apply this same liberal interpretation herein when the bond posted was not genuine. In this case, there is really no bond posted since a fake or expired bond is in legal contemplation merely a scrap of paper. It should be stressed that the intention of lawmakers to make the bond an

Petitioners filed a case for illegal dismissal asking for severance pay among others. LA ruled in favor of petitioner. On April 3, 1992, private respondents were served a copy of the decision of the labor arbiter. Aggrieved, they filed on April 13, 1992 with NLRC their memorandum on appeal. Nevertheless, it was only on April 30, 1992, that private respondents filed the appeal bond. Unfortunately, the aforesaid

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Magsino Labor Relations Digests, Arbues 2019 indispensable requisite for the perfection of an appeal by the employer is underscored by the provision that an appeal by the employer may be perfected only upon the posting of a cash or surety bond. The word "only" makes it perfectly clear that the lawmakers intended the posting of a cash or surety bond by the employer to be the exclusive means by which an employer's appeal may be perfected.

resolving the Urgent Motion to Reduce Bond, the NLRC dismissed the appeal of petitioner for appellant's failure to put up a bond.

As the appeal filed by private respondents was not perfected within the reglementary period, the running of the prescriptive period for perfecting an appeal was not tolled. Consequently, the decision of the labor arbiter became final and executory upon the lapse of ten calendar days from receipt of the decision. Hence, the decision became immutable and it can no longer be amended nor altered by the labor tribunal. Accordingly, inasmuch as the timely posting of appeal bond is an indispensable and jurisdictional requisite and not a mere technicality of law, the NLRC has no authority to entertain the appeal, much less to set aside the decision of the labor arbiter in this case. Any amendment or alteration made which substantially affects the final and executory judgment is null and void for lack of jurisdiction, including the entire proceedings held for that purpose.

Held: No. What obviously misled the NLRC in imposing the posting of a bond as a precondition before it can act on the motion to reduce the bond is provision of Article 223 (par. 2) of the Labor Code which requires the posting of the bond before an appeal "may be perfected."

Issue: WON NLRC validly dismissed the appeal and motion to reduce bond for failure to post bond.

There is a clear distinction between the filing of an appeal within the reglementary period and its perfection. The latter may transpire after the end of the reglementary period for filing the appeal. Under Article 223, an appeal to the NLRC from the decisions, awards or orders of the LA must be made "within 10 calendar days from receipt of such decisions, awards or orders." Under Section 3(a) of Rule VI of the New Rules of Procedure of the NLRC, the appeal fees must be paid and the memorandum of appeal must be filed within the ten-day reglementary period. Neither the Labor Code nor its implementing rules specifically provide for a situation where the appellant moves for a reduction of the appeal bond. Inasmuch as in practice the NLRC allows the reduction of the appeal bond upon motion of appellant and on meritorious grounds, it follows that a motion to that effect may be filed within the reglementary period for appealing. Such motion may be filed in lieu of a bond which amount is being contested. In the meantime, the appeal is not deemed perfected and the LA retains jurisdiction over the case until the NLRC has acted on the motion and appellant has filed the bond as fixed by the NLRC. G.R. No. 114161 November 23, 1995 VIRGILIO M. CAÑETE v NLRC

G.R. No. 108914 September 20, 1994 STAR ANGEL HANDICRAFT v NLRC Facts: Respondent Fribaldos filed money claims against petitioner in LA. LA ruled in favor of Frivaldos. Petitioner moved for the reconsideration of the decision of the LA. After the denial of the motion for reconsideration, petitioner appealed to the NLRC with an Urgent Motion to Reduce Bond, alleging as grounds grave abuse of discretion committed by the Labor Arbiter in computing the award of the claims based on an erroneous applicable, daily-minimum wage for the handicraft establishment. The motion averred that a big portion of the awards had already prescribed, thus justifying the reduction of the bond from P93k to only P19k.Without

Petitioner VIRGILIO M. CAÑETE assails the Decision and Resolution of the NLRC, dated September 20, 1993 and December 20, 1993, respectively, as having been issued with grave abuse of discretion. Petitioner claims he was illegally dismissed from service. His employer, however, private respondent VICENTE TING/V.T. MARKETING, maintains petitioner abandoned his job.

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Magsino Labor Relations Digests, Arbues 2019 Private respondent is a wholesaler of dry goods. Petitioner started working with private respondent as helper-utility man on July 11, 1987. Petitioner alleged that he and his co-employees worked from 7:30 a.m. until past 6:00 p.m., but it was made to appear on their time cards that they worked the regular eight (8) hours from 8:00 a.m. to 5:00 p.m. Thus, they received compensation for only eight (8) hours work and were underpaid.

(a) petitioner worked for only four (4) days for the payroll period May 14-19, 1990; (b) he was absent for three (3) days for the payroll period June 2530, 1990; (c) he was absent for two (2) days for the payroll period November 12-17, 1990;

On July 22, 1992, at about 7:10 a.m., petitioner arrived at the workplace and found some of his co-employees already working. He casually remarked: "Why are we working so early when we were supposed to start (at) 7:30 a.m.? In fact, we (have) already been deprived of half an hour('s pay) because our payrolls indicate that we start (work) at 8:00 a.m." Somehow, his remark reached management. At about 6:00 p.m. that night, petitioner was summoned by respondent's manager, Joaquin Chua. He was told not to report for work anymore and he would just be paid for the services he rendered. Petitioner inquired why he was being dismissed. Referring to petitioner's remark that morning, Chua told petitioner he was interferring with the work of his co-employees. Petitioner explained he merely aired a harmless observation. His explanation did not satisfy Chua. Petitioner was ordered to return the following day to get his separation pay.

(d) he was absent for three (3) days for the payroll period May 1116, 1992; (e) he was absent the whole working week of May 18-23, 1992; and, In a Decision, dated March 8, 1993,4 Labor Arbiter Ray Alan T. Drilon ruled that petitioner did not abandon his job but was illegally dismissed from service. Petitioner was awarded backwages, separation pay and attorney's fees. He was also given wage differentials due to a finding of underpayment of wages.

The next day, when petitioner reported for work, he was offered the amount of Six Thousand Pesos (P6,000.00) as separation pay. He refused the offer. Respondent then barred him from working. A month later, petitioner filed with the Department of Labor a complaint for illegal dismissal, underpayment of wages, non-payment of 13th month pay and damages. 1

As per the return of service, Atty. Enrique Chua, private respondent's counsel, received a copy of the Decision of the labor arbiter on March 15, 1993. However, private respondent's appeal to the National Labor Relations Commission (NLRC) was filed only on March 26, 1993, or a day after the lapse of the ten-day period prescribed by law. Initially, the NLRC dismissed his appeal.5

Private respondent, on the other hand, presented a different story. On July 22, 1992, private respondent reprimanded petitioner for his repeated and habitual absences from work. From that day on, petitioner did not report for work. It was three (3) days later, or on July 25, 1992, when petitioner returned but only to demand payment for his three-days work for the payroll period July 20-25, 1992. Private respondent reported the abandonment of work to the Department of Labor on August 10, 1992. He also furnished petitioner a copy of the notice of termination due to abandonment at his last known address. However, the notice did not reach petitioner since, as per the Certification2of Postmaster Roberto Robit, petitioner was unknown at the given address.3

Private respondent moved for a reconsideration of the dismissal of his appeal. He explained that the copy of the labor arbiter's Decision which was sent by registered mail to his lawyer, Atty. Enrique Chua, was received by one NENETTE VASQUEZ, a person not under the employ of his lawyer. Vasquez was a sales representative of United System, an office which-adjoins Chua's law office. Attached to the Motion was the Affidavit of Vasquez6 where she deposed that she received a copy of said Decision on March 15, 1993, at about 8:20 a.m. On said date and time, she was resting at the well-ventilated premises of Atty. Chua's office which was then still closed. She was still resting when the postman who regularly delivered mail in said building, asked her if she could receive the mail intended for Atty. Chua as the latter's office was still closed. She acceded and signed the registry return card.

In support of his position that petitioner had repeatedly absented himself from work, and that he was reprimanded therefor, private respondent submitted to the NLRC petitioner's time records which disclosed the following:

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Magsino Labor Relations Digests, Arbues 2019 Vasquez stayed on the premises of Atty. Chua's office for about 15-20 minutes. Thereafter, she left to see a prospective client and inadvertently brought with her the mail intended for Atty. Chua. She was able to give the mail to Anelyn Cadiz, Chua's clerk, only the following day, March 16, 1993. However, she failed to inform Cadiz that she actually received the mail the day before. Cadiz thus presumed that the mail was delivered only on said date. Consequently, Atty. Chua reckoned the period of appeal from March 16, 1993 and actually filed respondent's appeal ten (10) days thereafter, or on March 26, 1993. Vasquez' account of the incident was corroborated by the postman, Roque S. Tubungbanua7 and Chua's clerk, Anelyn Cadiz.8

First. Petitioner avers that private respondent failed to make a timely appeal of the Decision of the labor arbiter to the NLRC. He insists that receipt by Nenette Vasquez of a copy of the Decision of the labor arbiter on March 15, 1993 should have been considered as receipt of said Decision by Atty. Chua, private respondent's then counsel of record. The fact that Ms. Vasquez may have handed a copy of said Decision to a clerk of Atty. Chua only on March 16, 1993 is of no moment. Since the return of service shows that the Decision was received on March 15, 1993, private respondent had only until March 25, 1993 within which to perfect his appeal with the NLRC. Hence, private respondent's appeal on March 26, 1993 was belatedly filed, rendering the labor arbiter's Decision final and executory.

Petitioner opposed the motion for reconsideration. 9 He alleged that service of the copy of the labor arbiter's Decision to Vasquez on March 15, 1993 should be deemed as proper service to respondent's counsel. Petitioner also objected to the documents submitted by respondent to the NLRC for the first time on appeal, viz: (a) petitioner's daily time record and payroll for the months of August and December 1989 and April 1990 attached to respondent Notice and Memorandum on Appeal; (b) Certification of the Postmaster of Bacolod City, dated May 11, 1993, that he was not able to effect delivery of the notice of abandonment for petitioner was unknown at the given address. Petitioner charged that he was denied due process when these documents were presented only at such late stage and was not adduced at the hearing before the labor arbiter.

The contention has no merit. Section 4, Rule 13 of the Rules of Court provides: Sec. 4. Personal service. — Service of the papers may be made by delivering personally a copy to the party or his attorney, or by leaving it in his office with his clerk or with a person having charge thereof. If no person is found in his office, or his office is not known, then by leaving the copy, between the hours of eight in the morning and six in the evening, at the party's or attorney's residence, if known, with a person of sufficient discretion to receive the same.

In its Decision, 10 dated September 20, 1993, NLRC reversed the Decision of the labor arbiter. It ruled that petitioner was not illegally dismissed but abandoned his work. Nonetheless, in view of the willingness of the employer to pay separation pay, the NLRC awarded to petitioner the amount of Nine Thousand Seven Hundred Fifteen Pesos and Eighty Centavos (P9,715.80) as separation pay. Petitioner's claims for underpayment of wages and damages were found unmeritorious and were likewise dismissed. Petitioner moved for reconsideration. It was denied. 11

We have ruled that where a copy of the decision is served on a person who is neither a clerk nor one in charge of the attorney's office, such service is invalid. 12 In the case at bar, it is undisputed that Nenette Vasquez, the person who received a copy of the labor arbiter's Decision, was neither a clerk of Atty. Chua, respondents counsel, nor a person in charge of Atty. Chua's office. Hence, her receipt of said Decision on March 15, 1993 cannot be considered as notice to Atty. Chua. Since a copy of the Decision was actually delivered by Vasquez to Atty. Chua's clerk only on March 16, 1993, it was only on this date that the ten-day period for the filing of respondent's appeal commenced to run. Thus, respondent's March 26, 1993 appeal to the NLRC was seasonably filed.

Hence, this petition for certiorari. Petitioner contends that the NLRC acted with grave abuse of discretion in: (a) declaring private respondent's appeal to have been seasonably filed; (b) holding that petitioner was not dismissed but abandoned his employment; and, (c) admitting and considering evidence which had been presented by private respondent for the first time on appeal.

Second. Petitioner charges that the NLRC abused its discretion when it considered, over his objection, certain documents 13 which private respondent submitted for the first time on appeal. Petitioner claims he was denied due process.

Before proceeding with the substantive issue raised in this petition, we shall first rule on the procedural objections raised by petitioner.

We do not agree.

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Magsino Labor Relations Digests, Arbues 2019 Article 221 of the Labor Code mandates that technical rules of evidence in courts of law shall not be controlling in any of the proceedings before the Commission or the Labor Arbiters. Further, the Commission is required to use every reasonable means to ascertain the facts without regard to technicalities or procedure. Technical rules may be relaxed to prevent miscarriage of justice. They must not be allowed to stand in the way of equitably and completely resolving the rights and obligations of the parties. 14

any inference that he abandoned his work. Abandonment is a matter of intention and cannot be lightly inferred or legally presumed from certain equivocal acts. To constitute abandonment, there must be clear proof of deliberate and unjustified intent to discontinue the employment. 15 The burden of proving abandonment of work as a just cause for dismissal is on the employer. Private respondent failed to discharge this burden. IN VIEW WHEREOF, the Decision and Resolution of the National Labor Relations Commission, dated September 20, 1993 and December 20, 1993, respectively, are REVERSED. Accordingly, the Decision of Labor Arbiter Ray Alan T. Drilon, dated March 8, 1993, is REINSTATED, except with respect to the award of wage differentials relative to the charge of under payment of wages which is hereby deleted. No costs.

In the case at bar, petitioner had the opportunity to rebut the truth of these additional documents. Respondent NLRC correctly accorded weight to these documents considering their nature and character. These were daily time records, certifications from the postmaster, etc., whose trustworthiness can be relied upon. Consequently, we find no grave abuse of discretion on the part of the NLRC in considering on appeal petitioner's daily time records and payrolls for the period August 1989, December 1989 and April 1990 to rebut the charge of underpayment of wages. On the basis of these documents, it was sufficiently proved that petitioner received the minimum daily wage for said period. Perforce, the NLRC correctly dismissed petitioner's charge for underpayment of wages. However, on the issue of illegal dismissal, we find that petitioner did not abandon his work but was illegally dismissed from service. Private respondent claims that petitioner abandoned his employment after he was reprimanded for his past absences. As proof thereof, private respondent submitted the pertinent daily time records of petitioner from way back May 1990. However, the evidence adduced by private respondent show that petitioner was last absent from work on May 18-23, 1992. Private respondent's stance that he reprimanded petitioner for his past absences after the lapse of one month, or on July 22, 1992 strains the limits of credence. Indeed, private respondent did not cite any immediate circumstance which could have triggered such a reprimand on that particular day. The circumstances narrated by private respondent leading to petitioner's alleged abandonment of work are highly suspect. On top of all, it is difficult to imagine that petitioner would abandon his job for prior to his dismissal on July 22, 1992, petitioner, a daily-wage earner, had been in the employ of private respondent since July 11, 1987, or for close to five (5) years. We find it incongruous for petitioner to give up his job after receiving a mere reprimand from his employer. What is more telling is that on August 19, 1992 or less than a month from the time he was dismissed from service, petitioner immediately filed a complaint against his employer for illegal dismissal with a prayer for reinstatement. Petitioner's acts negate

G.R. No. 108951. March 7, 2000

JESUS B. DIAMONON v DOLE

Facts: Petitioner was removed as VP of National Congress of Unions in the Sugar Industry of the Philippines (NACUSIP) and Vice President for Luzon of the Philippine Agricultural, Commercial and Industrial Workers Union (PACIWU) respectively through resolutions approved by the boards of the 2 unions. There are 2 cases here. The 1st case is a is a complaint against the 2 unions while the 2nd case is against Atty. Dela Cruz for violating the CBLs of both unions.

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Magsino Labor Relations Digests, Arbues 2019 company on January 18, 1990. 2 strikes ensued prompting the labor sec to certify the dispute to NLRC for compulsory arbitration.

The 1st case was ruled in favor of petitioner while the 2 nd case was dismissed for lack of personality to sue since “petitioner was already removed.” Petitioner appealed the 2nd case in DOLE Sec. Laguesma. Laguesma held that petitioner failed to show in his complaint that the administrative remedies provided for in the constitution and by-laws of both unions, have been exhausted or such remedies are not available, was fatal to petitioners cause. Resultantly, he affirmed the dismissal of the complaint.

The company alleging loss of income, asked NLRC to submit evidence to prove the same. NLRC granted. Issue:

WON NLRC committed gadilej for allowing receipt of additional evidence.

Held: No. Anent the contention that the respondent Commission gravely abused its discretion when it allowed the presentation of additional evidence to prove the loss suffered by the company despite the fact that they were mere afterthoughts and just concocted by the company, time and again, We emphasize that "technical rules of evidence are not binding in labor cases. Labor officials should use every and reasonable means to ascertain the facts in each case speedily and objectively, without regard to technicalities of law or procedure, all in the interest of due process"

Issue: WON Dole sec. validly switched the issue from lack of personality to failure to exhaust administrative remedies. Held: Yes. His failure to seek recourse before the National convention on his complaint against private respondents taints his action with prematurity. Generally, an appellate court may only pass upon errors assigned. However, this rule is not without exceptions. In the following instances, the Supreme Court ruled that an appellate court (and quasi-judicial bodies) is accorded a broad discretionary power to waive the lack of assignment of errors and consider errors not assigned: (a) Grounds not assigned as errors but affecting the jurisdiction of the court over the subject matter; (b) Matters not assigned as errors on appeal but are evidently plain or clerical errors within contemplation of law; (c) Matters not assigned as errors on appeal but consideration of which is necessary in arriving at a just decision and complete resolution of the case or to serve the interests of a justice or to avoid dispensing piecemeal justice; (d) Matters not specifically assigned as errors on appeal but raised in the trial court and are matters of record having some bearing on the issue submitted which the parties failed to raise or which the lower court ignored; Supreme (e) Matters not assigned as errors on appeal but closely related to an error assigned; (f) Matters not assigned as errors on appeal but upon which the determination of a question properly assigned, is dependent. G.R. No. 101539 September 4, 1992 CECILE DE OCAMPO v NLRC

G.R. No. 130866 September 16, 1998

ST. MARTIN FUNERAL v NLRC

Facts: Respondent Aricayos filed a complaint for illegal dismissal against petitioner. Petitioner insist that Aricayos was not an employee but only helps voluntarily as payment for debt of gratitude. LA dismissed the complaint due to lack of jurisdiction for there was no EER present. NLRC remanded the case to LA. Petitioner filed this PetCert to SC arguing that NLRC committed gadilej. Issue:

WON petition should be remanded to CA.

Held: Yes. BP 129 as amended by RA 7902 brings about the following changes: 1. The last paragraph which excluded its application to the LC and the Central Board of Assessment Appeals was deleted and replaced by a new paragraph granting the CA limited powers to conduct trials and hearings in cases within its jurisdiction. 2. The reference to the LC in that last paragraph was transposed to paragraph (3) of the section, such that the original exclusionary clause therein now provides "except those falling within the appellate jurisdiction of the SC in accordance with the Constitution, the LC under PD No. 442, as amended, the provisions of this Act,

Facts: Baliwag Mahogany Corp. issued 3-day suspension orders affecting 20 employees for failure to render overtime work. On the same day, the union filed a notice of strike on the grounds of ULP particularly the violation of the CBA provisions on non-payment of unused leaves. On January 13, 1990, the company issued a notice of termination to petitioner et al allegedly to effect cost reduction and redundancy. The members of the union conducted a picket at the main gate of the

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Magsino Labor Relations Digests, Arbues 2019 and of subparagraph (1) of the 3rd paragraph and subparagraph (4) of the 4th paragraph of Section 17 of the Judiciary Act of 1948." 3. Contrarily, however, specifically added to and included among the quasijudicial agencies over which the CA shall have exclusive appellate jurisdiction are the SEC, the SSC, the Employees Compensation Commission and the CSC

However, instead of filing the required motion for reconsideration, petitioner filed the instant petition for certiorari. In doing so, petitioner boldly avers that a recourse to the NLRC via a motion for reconsideration is futile and will only injure further her rights to a speedy and unbiased judgment of the case. She did not expect the labor tribunal to rectify itself.

Paragraph (3), Section 9 of B.P. No. 129 now grants exclusive appellate jurisdiction to the CA over all final adjudications of the RTC and the quasi-judicial agencies generally or specifically referred to therein except, among others, those falling within the appellate jurisdiction of the SC in accordance with the Labor Code under Presidential Decree No. 442, as amended.

Issue:

WON certiorari should be dismissed because MR should be filed first.

Held: Yes. It is settled that certiorari will lie only if there is no appeal or any other plain, speedy and adequate remedy in the ordinary course of law against acts of public respondent. In this case, the plain and adequate remedy expressly provided by law is a motion for reconsideration of the impugned resolution, to be made under oath and filed within ten (10) days from receipt of the questioned resolution of the NLRC, a procedure which is jurisdictional. Hence, the filing of the petition for certiorari in this case is patently violative of prevailing jurisprudence and will not prosper without undue damage to the fundamental doctrine that undergirds the grant of this prerogative writ.

The Court is, therefore, of the considered opinion that ever since appeals from the NLRC to the Supreme Court were eliminated, the legislative intendment was that the special civil action of certiorari was and still is the proper vehicle for judicial review of decisions of the NLRC. The use of the word "appeal" in relation thereto and in the instances we have noted could have been a lapsus plumae because appeals by certiorari and the original action for certiorari are both modes of judicial review addressed to the appellate courts. The important distinction between them, however, and with which the Court is particularly concerned here is that the special civil action of certiorari is within the concurrent original jurisdiction of this Court and the CA; whereas to indulge in the assumption that appeals by certiorari to the SC are allowed would not subserve, but would subvert, the intention of Congress.

Further, it should be stressed that without a motion for reconsideration seasonably filed within the ten-day reglementary period, an order, decision or resolution of the NLRC, becomes final and executory after ten (10) calendar days from receipt thereof. Hence, the resolution of the NLRC had become final and executory on January 17, 1992, insofar as petitioner is concerned, because she admits under oath having received notice thereof9 on January 7, 1992. The merits of her case may no longer be reviewed to determine if the public respondent might be faulted for grave abuse of discretion, as alleged in her petition dated March 14, 1992. Thus, the Court has no recourse but to sustain the respondent's position on jurisdictional and other grounds, that the petition ought not to be given due course and the case should be dismissed for lack of merit.

Becase there is a growing number of labor cases being elevated to this Court which, not being a trier of fact, only to remand it to NLRC for resolution of ambiguous factual findings; that the CA is procedurally equipped for that purpose; and that there is undeniably an imperative need for expeditious action on labor cases as a major aspect of constitutional protection to labor; Therefore, all references in the amended Section 9 of B.P. No. 129 to supposed appeals from the NLRC to the SC are interpreted and hereby declared to mean and refer to petitions for certiorari under Rule 65. Consequently, all such petitions should hence forth be initially filed in the CA in strict observance of the doctrine on the hierarchy of courts as the appropriate forum for the relief desired. G.R. No. 104302 July 14, 1999 REBECCA VELOSO v China Airlines

G.R. No. 126805 Facts: Petitioner, a ticket officer, was laid off due to closure of a ticketing section to prevent losses. Petitioner filed a case of illegal dismissal and UPL. LA ruled in favor of petitioner. NLRC reversed but ordered respondent to pay retrenchment pay.

March 16, 2000

PAL v NLRC

Facts: Respondent Pescante was load controller for PAL. He was accused of contracting a passenger named Cominero with excess baggage to make it appear that her baggage was within the allowable limit. Petitioner filed an admin case against Pescante who was found guilty and subsequently dismissed.

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Magsino Labor Relations Digests, Arbues 2019 of his employment agreement and the reimbursement of his airfare. In March of 1996, the case was referred to the NLRC as by then it was this agency which had jurisdiction over respondent’s complaint by virtue of RA 8042, the Migrant Workers and Overseas Filipinos Act of 1995.

Pescante filed a case for illegal dismissal. LA upheld the dismissal but NLRC reversed. PAL filed rule 65 with SC. Issue:

WON SC may review factual issues. LA ruled in favor of respondent. NLRC dismissed the appeal. Petitioner filed PetCert under R45 to the CA. CA dismissed the petition because: (1) there is no certification against forum shopping by co-petitioner Hamil Development Co., Ltd.; and (2) there is no written explanation why the service of the pleading was not done personally (Section 3, Rule 46 and Section 11, Rule 13, 1997 Rules of Civil Procedure). Apparently the certification for non-forum shopping was only signed by MC and not by Hanmil.

Held: Yes. In certiorari proceedings under Rule 65, this Court does not assess and weigh the sufficiency of evidence upon which the labor arbiter and public respondent NLRC based their decisions. Our query is limited to the determination of whether or not public respondent acted without or in excess of jurisdiction or with grave abuse of discretion in rendering the assailed decisions. But when the findings of the NLRC contradict those of the labor arbiter, this Court, in the exercise of its equity jurisdiction, must of necessity review the records of the case to determine which findings should be preferred as more comfortable to the evidentiary facts, as in this case.

Issue:

WON there should be strict compliance in the rule on non-forum shopping.

Held: No, substantial compliance is enough. In all cases filed in the CA, as with all initiatory pleadings before any tribunal, a certification of non-forum shopping signed by the petitioner must be filed together with the petition. The failure of a petitioner to comply with this requirement constitutes sufficient ground for the dismissal of his petition. Thus, the Court has previously held that a certification not attached to the complaint or petition or one belatedly filed or one signed by counsel and not the party himself constitutes a violation of the requirement which can result in the dismissal of the complaint or petition. However, with respect to the contents of the certification, the rule of substantial compliance may be availed of. This is because the requirement of strict compliance with the provisions regarding the certification of non-forum shopping merely underscores its mandatory nature in that the certification cannot be altogether dispensed with or its requirements completely disregarded. It does not thereby interdict substantial compliance with its provisions under justifiable circumstances.

G.R. No. 142314

June 28, 2001

In the case at bar, the CA should have taken into consideration the fact that petitioner Hanil is being sued by private respondent in its capacity as the foreign principal of petitioner MCEI. It was petitioner MCEI, as the local private employment agency, who entered into contracts with potential overseas workers on behalf of petitioner Hanil.

MC ENGINEERING v NLRC

Facts: Respondent entered into an employment agreement with petitioner for deployment as plumber in KSA. He was unable to complete contract. Respondent filed a complaint with the POEA against petitioners MC and Hanil for illegal dismissal where he prayed for the payment of his salaries for the unexpired portion

Issue:

WON service of pleading should be done personally.

Held: There may be substantial compliance but petitioner failed to comply. Section 11, Rule 13 of the 1997 Rules of Civil Procedure provides:

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Magsino Labor Relations Digests, Arbues 2019 that fateful day. CA in dismissing the PetRev argued that: (a) that the certification of non-forum shopping was defective; (b) that certified true copies of material portions of the record were not attached to the petition; and (c) that the petition failed to state all the material dates which would establish the timeliness thereof. As admitted by petitioner herself, she received a copy of the resolution on June 9, 1997, and yet it was only on January 27, 1998, or seven-and-a-half months later, that she filed a MR.

"Sec. 11. Priorities in modes of service and filing. – Whenever practicable, the service and filing of pleadings and other papers shall be done personally. Except with respect to papers emanating from the court, a resort to other modes must be accompanied by a written explanation why the service or filing was not done personally. A violation of this rule may be cause to consider the paper as not filed."

Issue: The utter disregard of the rules made by petitioners cannot justly be rationalized by harking on the policy of liberal construction and substantial compliance.

Held: No. The instant petition was not timely filed. Under section 1 of R45 of the former Revised Rules of Court, which was then still in effect, an appeal from a decision rendered by the CA to this Court must be made within 15 days from notice of the judgment or the denial of a motion for reconsideration filed in due time. In the case at bar, petitioner filed her MR from receipt of the resolution of dismissal 231 days late, thereby rendering the said resolution final and executory. The gap of more than 7 months is too large for us to ignore. Petitioner did not even offer any explanation to account for the tardiness. It behooves the party invoking liberality in the application of procedural rules to at least explain his non-compliance therewith. We have held that the period of appeal is not only mandatory, but more importantly, it is jurisdictional. Even we cannot ignore the immutable character of a final judgment.

The fact that an affidavit of service accompanied their petition does not amount to a substantial compliance with the requirement of an explanation why other modes of service other than personal service were resorted to. An affidavit of service, under Section 13, Rule 13 of the 1997 Rules of Civil Procedure, is required merely as proof that service has been made to the other parties in a case. Thus, it is a requirement totally different from the requirement that an explanation be made if personal service of pleadings was not resorted to. In fact, a cursory reading of the affidavit of service attached by petitioners in their petition before the Court of Appeals shows that it merely states that a certain Rogelio Mindol served copies of the pleading to the counsel of private respondent, the NLRC, and the SolicitorGeneral by registered mail. There is not even a hint of an explanation why such mode of service was resorted to.

G.R. No. 132916. November 16, 2001

WON SC should give due course to the PetCert.

RUFINA TANCINCO v GSIS

Facts: SPO1 Tancinco, an aide of VP Erap, was shot dead while off-duty. The Employee’s Compensation Commission denied his claims. ECC argued that Tancinco’s death, when he was on off duty status did not arise out of and in the course of his employment as a member of the PNP Security Command because he was neither executing an order for VP Estrada nor performing an official function on

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