EASTERN TELECOMMUNICATIONS (ETPI) 2011 / Leonardo-De Castro / ULP > Definition and General Concept FACTS Nelson Culili was employed as a Technician, and was promoted to Senior Technician after 15 years. In 1998, due to business troubles and losses, ETPI implemented a two-phased Right-Sizing Program: reduction of ETPI’s workforce, then a company-wide reorganization (transfer, merger, absorption or abolition of departments). ETPI offered a Special Retirement Program to employees who have been in service for at least 15 years. Of all the employees who qualified, only Culili rejected the offer. The functions of Culili’s unit were absorbed by another department , and his position was abolished (and was eventually absorbed by another employee) due to redundancy. Culili wrote to the union president in protest. He was informed of his termination from employment through a letter from the ETPI AVP. This letter was similar to the memo shown to Culili by the union president weeks before Culili was dismissed. Culili claims that ETPI contracted out the services he used to perform to a labor-only contractor, which not only proved that his functions had not become unnecessary, but which also violated the CBA + LC. In addition, neither he nor the DOLE were formally notified of his termination. He found out about it when he was handed a copy of the letter, after he was barred from entering ETPI’s premises. ETPI already decided to dismiss him even prior to the AVP’s letter, as evidenced by an earlier version of the letter. ETPI denied hiring outside contractors to perform Culili’s work. It also denied singling Culili out for termination. The abolition of Culili’s department and the absorption of its functions by another department were in line with the Right-Sizing Program’s goals. Since Culili did not avail of the Special Retirement Program and his position was subsequently declared redundant, ETPI had no choice but to terminate Culili. Because there was no more work for him, it was constrained to serve a final notice of termination, which Culili ignored. Culili filed a complaint for ULP, illegal dismissal, and money claims before the LA.  LC 248(c) – To contract out services or functions being performed by union members when such will interfere with, restrain or coerce employees in the exercise of their rights to self-organization  LC 248(e) – To discriminate in regard to wages, hours of work, and other terms and conditions of employment in order to encourage or discourage membership in any labor organization. Nothing in this Code or in any other law shall stop the parties from requiring membership in a recognized collective bargaining agent as a condition for employment, except those employees who are already members of another union at the time of the signing of the collective bargaining agreement. Employees of an appropriate collective bargaining unit who are not members of the recognized collective bargaining agent may be assessed a reasonable fee equivalent to the dues and other fees paid by members of the recognized collective bargaining agent, if such non-union members accept the benefits under the collective agreement: Provided, that the individual authorization required under Article 242, (o) of this Code shall not apply to the non-members of the recognized collective bargaining agent. LA – ETPI GUILTY OF ILLEGAL DISMISSAL AND ULP (AFFIRMED BY NLRC)  Re: ULP—the contracting out of Culili’s functions to non-union members violated his rights as a union member; ETPI was not able to dispute Culili’s claims of discrimination and subcontracting  The earlier version of the letter was a telling sign of the intention to dismiss even before declaration of redundancy. The ground that ETPI was actually invoking was retrenchment, but ETPI stuck to redundancy since it was easier to prove. ETPI failed to present reasonable criteria to justify declaration of redundancy. CA – VALID DISMISSAL, NO ULP  Re: ULP—mere contracting out of services being performed by union members does not per se amount to ULP unless it interferes with the employees’ right to self-organization.  Culili’s position validly abolished due to redundancy. ETPI officers cannot be held liable absent a showing of bad faith of malice. HOWEVER, ETPI failed to observe due process when it failed to notify both Culili and DOLE of the termination. ISSUE & HOLDING WON Culili’s dismissal can be considered as ULP. NO. However, ETPI has to pay nominal damages for non-compliance with statutory due process, in addition to the mandatory separation pay [LC 283]. RATIO Article 247. Concept of unfair labor practice and procedure for prosecution thereof. ------ Unfair labor practices violate the constitutional right of workers and employees to self-organization, are inimical to the legitimate interest of both labor and management, including their right to bargain collectively and otherwise deal with each other in an atmosphere of freedom and mutual respect, disrupt industrial peace and hinder the promotion of healthy and stable labor-management relations. ULP refers to ‘acts that violate the workers' right to organize.’ The prohibited acts are related to the workers' right to selforganization and to the observance of a CBA. An employer may only be held liable for unfair labor practice if it can be shown that his acts affect in whatever manner the right of his employees to self-organize. There is no showing that ETPI, in implementing its Right-Sizing Program, was motivated by ill will, bad faith or malice, or that it was aimed at interfering with its employees’ right to self -organization. In fact, ETPI negotiated and consulted with the SEBA before implementing the program. By imputing bad faith to ETPI’s actuations, Culili has the burden of proof to present substantial evidence to support the allegation of ULP. Culili failed to discharge this burden and his bare allegations deserve no credit. Petition DENIED.