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LAKAS NG petitioner, vs.
MARCELO ENTERPRISES and MARCELO TIRE & RUBBER CORP., MARCELO RUBBER AND LATEX PRODUCTS, MARCELO STEEL, CORPORATION, MARCELO CHEMICAL & PIGMENT CORP., POLARIS MARKETING CORPORATION and THE COURT OF INDUSTRIAL RELATIONS, respondents,
MARCELO TIRE & RUBBER CORPORATION, MARCELO RUBBER & LATEX PRODUCTS, INC., MARCELO STEEL CORPORATION, POLARIS MARKETING CORPORATION, MARCELO CHEMICAL AND PIGMENT CORP., MARCELO ENTERPRISES, under which name or style they are also known, petitioners, vs. LAKAS NG MANGGAGAWANG MAKABAYAN (LAKAS) AND THE HONORABLE COURT OF INDUSTRIAL RELATIONS, respondents.
Separate appeals by certiorari from the Decision of the Court of Industrial Relations (Manila) dated July 20, 1973, as well as the Resolution of the court en banc dated January 24, 1974 denying the reconsideration thereof rendered in ULP Case No. 4951 entitled, "Lakas ng Manggagawang Makabayan, Petitioner, versus Marcelo Enterprises and Marcelo Tire and Rubber Corporation, Marcelo Rubber and Latex Products, Marcelo Steel Corporation, Polaris Marketing Corporation, and Marcelo Chemical and Pigment Corporation, Respondents. "
The antecedent facts as found by the respondent Court of Industrial Relations embodied in the appealed Decision are correct, supported as they are by the evidence on record. Nevertheless, We find it necessary to make a re-statement of the facts that are integrated and inter-related, drawn from the voluminuous records of these cases which are herein jointly decided, since it would only be from a statement of all the relevant facts of the cases made in all fullness, collectively and comprehensively, can the intricate issues posed in these appeals be completely and judiciously resolved.
It appears that prior to May 23, 1967, the date which may be stated as the start of the labor dispute between Lakas ng Manggagawang Makabayan (hereinafter referred to as complainant LAKAS) and the management of the Marcelo Tire and Rubber Corporation, Marcelo Rubber and Latex Products, Inc., Polaris Marketing Corporation, Marcelo Chemical and Pigment Corporation, and the Marcelo Steel Corporation (Nail Plan) (hereinafter referred to as respondent Marcelo Companies) the Marcelo Companies had existing collective bargaining agreements (CBAs) with the local unions then existing within the appropriate bargaining units, viz: (1) the respondent Marcelo Tire and Rubber Corporation, with the Marcelo Camelback Tire and Foam Union (MACATIFU); (2) the respondent Marcelo Rubber and Latex Products, Inc., with the Marcelo Free Workers Union (MFWU); and (3) the respondent Marcelo Steel Corporation with the United Nail Workers Union (UNWU). These existing CBAs were entered into by and between the parties while the aforestated local unions were then affiliated with a national federation, the Philippine Social Security Labor Union (PSSLU). It is well to note from the records that when the aforestated CBAs of the said local unions were nearing their respective expiration dates (March 15,1967) for MACATIFU and UNWU, and June 5, 1967 for MFWU), the general situation within the ranks of labor was far from united. The MACATIFU in respondent Marcelo Tire and Rubber Corporation, then headed by Augusto Carreon, did not enjoy the undivided support of all the workers of the respondent corporation, as there existed a rival union, the Marcelo United Employees and Workers Association (MUEWA) whose president was then Paulino Lazaro. As events would later develop, the members of the MACATIFU of Augusto Carreon joined the MUEWA of Paulino Lazaro, after the latter filed a petition for direct certification which was granted by the industrial court's Order of July 5, 1967 recognizing and certifying MUEWA as the sole and exclusive bargaining representative of all the
regular workers of the respondent corporation. The union rivalry between MACATIFU and MUEWA did not, however, end with the Order of July 5. 1967, but more than ever developed into a more pressing problem of union leadership because Augusto Carreon also claimed to be the president of the MUEWA by virtue of the affiliation of his MACATIFU members with MUEWA. The records also reveal that even the ranks of MFWU in respondent Marcelo Rubber and Latex Products, Inc. was divided between those supporting Ceferino Ramos and Cornelio Dizon who both claimed the presidency in said union. Only the UNWU in respondent Marcelo Steel Corporation was then enjoying relative peace as Jose Roque was solely recognized as the union's president. The events that followed are hereinafter stated in chronological order for a clearer understanding of the present situation.
On March 14, 1967, the management of respondent Marcelo Steel Corporation received a letter requesting the negotiation of a new CBA together with a draft thereof, from the PSSLU president, Antonio Diaz, for and in behalf of UNWU whose CBA was to expire the following day. Similar letters and proposals were, likewise, sent to the management of respondent Marcelo Tire and Rubber Corporation for and in behalf of MACATIFU, and to respondent Marcelo Rubber and Latex Products for and in behalf of MFWU, whose respective CBAs were both to expire on June 5, 1967.
However, on that very same day of March 14, 1967, the management of respondent Marcelo Tire and Rubber Corporation received a letter from the UNWU president, Jose Roque, disauthorizing the PSSLU from representing his union.
Then, on April 14, 1967, Paulino Lazaro of MUEWA requested negotiation of a new CBA with respondent Marcelo Tire and Rubber Corporation, submitting therewith his union's own proposals.
Again, on May 3, 1967, the management of respondents Marcelo Tire and Rubber Corporation and Marcelo Rubber and Latex Products, Inc., received another letter requesting negotiation of new CBAs also for and in behalf of the MACATIFU and the MFWU from J.C. Espinas & Associates.
Finally, on May 23, 1967, the management of all the respondent Marcelo Companies received a letter from Prudencio Jalandoni, the alleged president of the complainant LAKAS. In this letter of May 23, 1967, the complainant LAKAS informed
This aforestated Notice of Strike was. alleging as reasons therefore harrassment of union officers and members due to union affiliation and refusal to bargain. as stated earlier in this Decision. 1967. 1967. Paulino Lazaro of MUEWA and complainant LAKAS of the fact of the existing conflicting demands for recognition as the bargaining representative in the appropriate units involved. In the meantime. 1967 before the Bureau of Labor Relations a Notice of Strike against all the respondent Marcelo Companies.C. In the case of MUEWA. PSSLU demurred to management's stand and informed them of its intention to file an unfair labor practice case because of management's refusal to bargain with it. the court granted the petition and by Order of July 5. with an assurance that the management will abide by whatever orders the industrial court may issue thereon. the MUEWA filed a petition for direct certification before the industrial court. and finding that MUEWA represented more than the majority of the workers in respondent Marcelo Tire and Rubber Corporation. certified MUEWA of Paulino Lazaro as the sole and exclusive bargaining representative of all the regular workers in said respondent. Included therein was a 17-points demand for purposes of the requested collective bargaining with management. . pointedly stating that it was with the PSSLU that the existing CBAs were entered into. On the other hand. it apprised PSSLU. Again. withdrawn on July 14. and (2) in a letter dated May 25.management of the affiliation of the Marcelo United Labor Union (MULU) with it. Confronted with a problem of whom to recognize as the bargaining representative of all its workers. Espinas & Associates. on or about the middle of August 1981. PSSLU filed a Notice of Strike which became the subject of conciliation with the respondent companies. 1967. the management of all the respondent Marcelo Companies understandably dealt with the problem in this wise. however. consequently suggesting to all to settle the question by filing a petition for certification election before the Court of Industrial Relations. complainant LAKAS for MULU filed on June 13. There being no other union or interested person appearing before the court except the MUEWA. Paulino Lazaro threatened that his union will declare a strike against respondent Marcelo Tire and Rubber Corporation. viz: (1) it asked proof of authority to represent the MFWU and the MACATIFU from J. as events later developed.
The records disclose that it was in the atmosphere of constant reservation on the part of management as to the question of representation recognition that complainant LAKAS and management sat down for CBA negotiations. 1967 whereby management. as earlier stated. 1967. expressing their conformity to sit down in conference on the points to be negotiated as soon as LAKAS can present evidence of authority to represent the employees of respondent corporations in said conference.25 to meritorious cases only. The first conference was held on August 14. 1967. Augusto Carreon of MACATIFU wrote the management of respondent Marcelo Tire and Rubber Corporation expressly stating that no one was yet authorized to submit proposals for and in behalf of the union for the renewal of its CBA. 1967 from Jose Delfin of Management to Jose B. the Notice of Strike filed by complainant LAKAS was withdrawn pursuant to a Memorandum Agreement signed on the same day by management and LAKAS. in formal reply to union's economic demands. Management likewise suggested the renewal of the other provisions of the existing CBA. 1967. the fourth conference was held where. Thereafter. followed by one on August 16. both dated July 24. 1967. management wrote two (2) letters. Roque of UNWU. and to increase its contribution to the retirement fund from 1-1/2% to 3% provided the employees' contribution will be increased from 1% to 2%. 1967. or on July 20. addressed to Jalandoni. In answer thereto. can be inferred that in the conference of August 29. letters of proposal for collective bargaining were sent by Prudencio Jalandoni of LAKAS to all the respondent Marcelo companies. from a letter dated August 30. Management's offers were not accepted by complainant LAKAS who insisted on the grant of all its economic demands and in all of the Marcelo Companies.15 to P0. 1967.On July 11. adding that "(a)ny group representing our Union is not authorized and should not be entertained. On August 29. 1967. . the management with respect to respondent Marcelo Steel Corporation. stated its willingness to give pay adjustments and suggested renewal of other provisions of the old CBAs. agreed to give pay adjustments from P0." On July 14. A third conference was set although no one from LAKAS or the local unions appeared.
The following day. except four (4) namely. all strikers were admitted back to work. Cornelio Dizon for MFWU and Augusto Carreon for MUEWA. As a consequence. discipline and dismiss its employees in accordance with law and existing rules and regulations that cases filed in court will be allowed to take their normal course. Delfin. or on September 4. On September 13. the complainant LAKAS declared a strike against all the respondent Marcelo Companies. Wilfredo Jarquio. to wit. Acts of violence and vandalism attended the picketing.As it would later appear during the trial of the ULP case below. One worker. As found by the respondent court. represented by Prudencio Jalandoni for LAKAS. Windows of the Chemical Plant were badly damaged. however. ten (10) strikers were later charged before the Municipal Court of Malabon. and the local unions. the agreement. 4. 1967. Roque for UNWU. Jose B. and as found as a fact by the respondent court. the respondent Marcelo Companies obtained a writ of preliminary injunction from the Court of First Instance of Rizal enjoining the strikers from preventing the ingress and egress at the respondents' premises. represented by Jose P. Ingress and egress at the respondents' premises were successfully blocked. 1967. provided it is understood that management has not waived and shall continue to exercise freely its rights and prerogatives to punish. who chose not to report for work because of the criminal charges filed against them before the municipal court of Malabon and because of the administrative investigation conducted by . Aside from providing for the immediate lifting of the picket lines. Less than a week after the fourth CBA conference. together with complainant LAKAS. the respondent Marcelo Companies resumed operations and the strikers went back to work. only the economic proposals of complainant LAKAS were the matters taken up in all these CBA conferences. the representations of the latter two. being expressly subjected by management to non-recognition. By virtue of this agreement. a "Return to Work Agreement" (Exhibit "A") was executed by and among the management. Jesus Lim and Arlington Glodeviza. more pertinently provides. The management agrees to accept all employees who struck without discrimination or harassment consistent with an orderly operation of its various plants. Marcelo and Jose A. Plaridel Tiangco. four of whom were convicted while the others were at large. was manhandled by the strikers and was hospitalized. Leonardo Sakdalan. Rizal.
management in connection with the acts of violence and vandalism committed during the September 4 strike. Together with Jesus Lim, three other strikers who reported for work and were admitted, namely, Jose Roque, Alfredo Cabel and Ramon Bataycan, were convicted in said criminal case.
After the resumption of normal business, the management of the respondent Marcelo Companies, the complainant LAKAS together with the local unions resumed their bargaining negotiations subject to the conditions earlier mentioned. On October 4, 1967, the parties met and discussed the bargaining unit to be covered by the CBA in case one is entered into, union shop arrangement, check-off, waiver of the employer of the notice requirement in case of employees' separation, separation pay in cash equivalent to 12-days pay for every year of service, retirement plan, and one or two years duration of the CBA. It was also agreed in that meeting not to negotiate with respect to respondent Marcelo Tire and Rubber Corporation inasmuch as a CBA had already been entered into by management with the MUEWA of Paulino Lazaro, the recently certified union in said respondent.
Finally, on October 13, 1967, the negotiations reached its final stage when the management of respondents Marcelo Rubber and Latex Products, Inc. and Marcelo Steel Corporation gave the complainant LAKAS a copy of management's drafts of the collective bargaining proposals for MFWU and UNWU, respectively.
Unexpectedly and without filing a notice of strike, complainant LAKAS declared another strike against the respondent Marcelo Companies on November 7, 1967, resulting in the complete paralyzation of the business of said respondents. Because of this second strike, conciliation conferences were again set by the Conciliation Service Division of the Department of Labor on November 8, November 23, and December 4, 1967. On the last aforementioned date, however, neither complainant LAKAS nor the local unions appeared.
Instead, on December 13, 1967, Prudencio Jalandoni of complainant LAKAS, in behalf of the striking unions, coursed a letter (Exhibit "B") to Jose P. Marcelo of management advising that, "on Monday, December 18, 1967, at 7:00 o'clock in the morning, all your striking workers and employees will return to work under the same terms and conditions of employment before the strike." The letter was attested to by Cornelio Dizon for MFWU, Jose Roque for UNWU and Augusto Carreon for MUEWA. On December 15,1967, the Bureau of Labor Relations was informed by
the complainant LAKAS who requested for the Bureau's representative to witness the return of the strikers to their jobs.
The records reveal that in the meantime, prior to December 13, 1967, some of the strikers started going back to work and were admitted; and that as early as December 4, 1967, the management started posting notices at the gates of the respective premises of the respondents for strikers to return back to work, Similar notices were also posted on December 18 and December 27, 1967.
Upon their return, the reporting strikers were requested to fill up a certain form (Exhibit "49") wherein they were to indicate the date of their availability for work in order that they may be scheduled. According to the respondent Marcelo Companies, this requirement was asked of the strikers for legitimate business reasons within management prerogative. Several of the strikers filled up the required form and were accordingly scheduled for work. The remaining others, led and supported by complainant LAKAS, refused and insisted that they be all admitted back to work without complying with the aforestated requirement, alleging that the same constituted a "screening" of the striking workers. As matters stood, Management refused to forego the requirement; on the other hand, the remaining strikers demanded to be readmitted without filing up the form for scheduling.
These then constitute the factual background when the complainant LAKAS, represented by its counsel, Atty. Benjamin C. Pineda, on December 26, 1967 , filed before the respondent court a charge for unfair labor practice against the respondent Marcelo Companies, alleging non- readmission of the striking members of the three (3) affiliated local unions despite the unconditional offer to return to work after the strike of November 7, 1967. Based on the allegations of the foregoing charge and after a preliminary investigation conducted by the acting Prosecutor of said respondent court, the acting Chief Prosecutor, Atty. Antonio Tria Tirona, filed on February 12, 1968 the instant complaint under authority of Section 5(b) of Republic Act 875, otherwise known as the Industrial Peace Act.
The Complaint below alleges, among others, to wit:
1. That complainant is a legitimate labor organization, with its affiliates, namely: Marcelo Free Workers Union, United Nail Workers Union, and Marcelo United Employees Unions, whose members listed in Annexes "A", "B", and "C" of this complaint are considered employees of respondent within the meaning of the Act;
xxx xxx xxx xxx xxx xxx 3. That individual complaints listed in Annexes "A", "B", and "C" of this complaint are members of the Marcelo United Employees and Workers Association, Marcelo Free Workers Union, and United Nail Workers Union, respectively; that the members of the Marcelo United Employees and Workers Union are workers of respondent Marcelo Tire and Rubber Corporation; that the members of the Marcelo Free Workers Union compose the workers of the Marcelo Rubber and Latex Products, Polaris Marketing Corporation, and the members of the United Nail Workers Union compose the workers of the Marcelo Steel Corporation (Nail Plant);
4. That each of the aforesaid local unions, before their affiliation with the complainant union LAKAS, had a collective bargaining agreement with respondents; that after the expiration of the collective bargaining agreement above-mentioned and after the above-mentioned local unions affiliated with the complainant LAKAS, the said federation sent to respondents' president, Jose P. Marcelo, on May 23, 1967, a letter, requesting for a negotiation for collective bargaining, together with union proposals thereof, but respondents refused;
5. That after respondents knew of the affiliation of the aforementioned local unions with the LAKAS, the said respondents, thru their officers and agents began harassing the union members, discriminated against them by transferring some of its officers and members from one section to another in such a way that their work was reduced to manual labor, and by suspending them without justifiable cause. in spite of long years of service with said respondents;
6. That as a result of the abovementioned unfair labor practice of respondents, and after complainant sent communication thereto, protesting against the acts of the above-mentioned, complainant decided to stage a strike on September 4, 1967, after filing a notice of strike with the Department of Labor;
in violation of the above-mentioned Return-to-Work agreement and refusal of respondents to bargain in good faith with complainant. That on September 14. That. as follows: 4. and "C and made as an integral part of this complaint. however. Marcelo. "B ". 1967. that in admitting union members back to work. That here to attached are the list of names of the members of the three local unions above-mentioned who were not admitted back to work by respondents. because of the refusal of the respondents to accept some union members. but respondents gave preference to the casual employees. Jose P. providing among others. The management agrees to accept all employees who struck without discrimination or harassment consistent with an orderly operation of its various plants provided it is understood that management has not waived and shall continue to exercise freely its rights and prerogatives to punish. and still continue to refuse to reinstate them up to the present. 9. Delfin. they were screened in spite of their long employment with respondent. discipline and dismiss its employees in accordance with law and existing rules and regulations and that cases filed in Court will be allowed to take their normal course. That. and Jose A. 1967 without any condition. and in violation thereof. entered into a Return-to-Work Agreement. 11. president and vice-president of the respondents. 1967. respondents refused to admit the members of the three striking local unions. 8. marked as Annexes "A ". 10. respectively. 1967. contrary to the above Return-to-Work agreement. again staged a strike on November 7.7. the latter. on one hand and the presidents of the three local unions above-mentioned and the national president of complainant union on the other. . but respondents likewise refused. together with the members of the three local unions above-mentioned. That on December 13. complainant sent a letter to respondents that the members of the striking unions abovementioned offered to return to work on December 18.
judgment be rendered. (c) Ordering respondents to bargain in good faith with complainant union. That the above unfair labor practice acts of respondents are in violation of Section 4. The Collective Bargaining Agreement between the United Rubber Workers Union (which eventually became the Marcelo Free Workers Union) and the respondent Marcelo Rubber and Latex Products. with back wages. The complaint prayed "that after due hearing. "B". 1967. 875. without loss of seniority rights and privileges thereof. I. 1967. On March 16. . 1967. after an Urgent Motion for Extension of Time to File Answer. the respondents filed their Answer denying the material allegations of the Complaint and alleging as affirmative defenses. and "C" hereof were not able to secure substantial employment in spite of diligent efforts exerted by them. Inc. subsections 1. 1967. That the union members listed in Annexes "A". 13. expired on June 5. declaring respondents guilty of unfair labor practice. in order to effectuate the policies of the Industrial Peace Act. and (a) Ordering respondents to cease and desist from further committing the acts complained of. (b) Ordering respondents to comply with the Return-to-Work agreement dated September 14. 1968.12. That the Collective Bargaining Agreement between respondent Marcelo Steel Corporation and the United Nail Workers Union expired on March 15.. and to admit back to work the workers listed in annexes "A". "B " and "C" hereof. 4 and 6 in relation to Sections 13. 14 and 15 of Republic Act No. the Collective Bargaining Agreement between Marcelo Camelback Tire and Foam Union and the Marcelo Tire and Rubber Corporation expired on June 5. and (d) Granting complainant and its complaining members thereof such other affirmative reliefs and remedies equitable and proper.
Respondents afforded union officers and members affected by the transfers the privilege to watch out for vacancies and select positions they prefer to be in. Delfin is the acting Personnel Manager of respondent Marcelo Rubber and Latex Products. That Mr. all workers of the different respondent corporations returned to work except the four mentioned in the preceding paragraph hereof who have pending criminal cases. respondent obtained an injunction from the Court of First Instance of Rizal. 1967 another strike was declared without justifiable cause. Jose P. 1967. Jose A. Marcelo of respondents informing him of the alleged affiliation of the Marcelo United Labor Union with complainant and submitting a set of collective bargaining proposal to which counsel for respondents replied suggesting that a petition for certification election be filed with the Court of Industrial Relations in view of the several demands for representation recognition. Only four (4) workers who had criminal cases filed against them voluntarily failed to report to the Personnel Department for administrative investigation. one Mr. Inc. 1967.. That respondents did not refuse to admit members of the striking union. and Marcelo Steel Corporation.II. VII. 1967. That on November 28. Marcelo Steel Corporation and Marcelo Chemical and Pigment Corporation. Caloocan City Branch. Marcelo is the President of Marcelo Rubber and Latex Products. proposals and counter. against the illegal picketing of . That between May 23. That the transfers of workers from one job to another were made in accordance with needs of the service. the start of the first strike. III. Respondents are not aware of whether or not a notice of strike was filed with the Court of Industrial Relations. Marcelo Tire and Rubber Corporation. No suspensions without justifiable cause were made as alleged in the Complaint.proposals were had. That after September 14. IV. 1967. 1967. VIII. the date of their first demand for negotiations. between September 14. Marcelo Tire and Rubber Corporation. and November 7. while Mr.. Inc. That on May 23. Jose P. VI. 1967. and September 4. Prudencio Jalandoni of complainant addressed a communication to Mr. V.
a number of workers showed no interest in reporting to work. That the local unions referred to in the Complaint if they ever had affiliated with complainant union had subsequently disaffiliated therefrom. was filed by the said union.the local unions. X. in the first week of December. That the strikes called and declared by the striking unions were illegal. and the gates notices calling all workers to return to work but a number of workers obviously were not interested in returning anymore. and praying for the dismissal of the Complaint as well as for the declaration of illegality of the two (2) strikes called by the striking unions. the striking workers began returning to work. 1968. "B" and "C" have resigned after they found more profitable employment elsewhere. lifting the picket line and returning to work. 1967. Bulletin Boards. IX. 1967. the trial commenced. headed by Paulino Lazaro. Then on October 24. 1967. a development occurred which gave a peculiar aspect to the case at bar. That a number of workers in the list Annexes "A". to wit. on December 13. XIII. A Manifestation and Motion signed by the respective officers and members of the MUEWA. XII. management posted in the Checkpoint. but they did not return to work. alleging. a letter was received from complainant advising respondents that its striking workers were calling off. Thereafter. XI. That respondents posted several times lists of names of workers who had not returned to work with the invitation to return to work. respondents invited the striking workers desiring to return to work to fill out an information sheet stating therein their readiness to work and the exact dates they were available so that proper scheduling could be done. That the local unions were bargaining in bad faith with respondents. that from the first week of December. .
5.. the Complaint filed by the Petitioner in the above-entitled case in behalf of the Marcelo United Employees and Workers Association is without authority from the latter and therefore the officers and/or representatives of the petitioning labor organization should be cited for Contempt of Court.. the Complaint filed by the Petitioner in the above-entitled case in behalf of the Marcelo United and Employees and Workers Association should be considered as withdrawn.. That to set the records of this Honorable Court straight. .. headed by its President. .. the undersigned officers and members of the Marcelo United Employees and Workers Association respectfully manliest that the aforesaid organization has no complaint whatsoever against any of the Marcelo Enterprises. .. to wit. alleging. 1968 and signed by the officers and members of the UNWU. 4. 6. That the above-entitled case purportedly shows that the Marcelo United Employees and Workers Association is one of the Complainants being represented by the Petitioner Lakas ng Manggagawang Makabayan (LMM). That it likewise appears in the above-entitled case that the services of the herein Petitioner was sought by a certain Augusto Carreon together with his cohorts who are not members of the Marcelo United Employees and Workers Association much less connected with the Marcelo Tire and Rubber Corporation wherein the Marcelo United Employees and Workers Association has an existing Collective Bargaining Agreement. 2.l. 3.. ... Juan Balgos. xxx xxx xxx This was followed by another Manifestation and Motion flied on November 6.
except that the disaffiliation of the MFWU from LAKAS was made effective January 25. xxx xxx xxx Likewise. . That in view further of the fact that the filing of the above-entitled case was made over and above the objections of the Officers and members of the United Nail Workers Union. 1968. 3. stated the same allegations as the Manifestation and Motion filed by the UNWU quoted above. The Resolutions of Disaffiliation of both MFWU and UNWU were attached to these Manifestations.management relations within all the Marcelo enterprises. a Manifestation and Motion signed by the Officers and members of the MFWU. That the above-entitled case purportedly shows that the United Nail Workers Union is being represented by the Petitioner Lakas ng Manggagawang Makabayan for the alleged reason that the former is one of the affiliates of the latter. all the Officers and members of the United Nail Workers Union disaffiliated from the herein Petitioning labor organization for the reason that Petitioning labor organization could not serve the best interest of the Officers and members of the United Nail Workers Union and as such is a stumbling block to a harmonious labor.1.entitled case in the interest of a harmonius labor-management relation within the Marcelo Enterprises. 5. headed by its president. the latter therefore manifest their intention to cease and desist as they hereby ceased and desisted from further prosecuting the above. That on January 15. That the filing of the above-entitled case by the herein Petitioning labor organization was made over and above the objections of the officers and members of the United Nail Workers Union. 1968. 2. 4. 1968 and filed November 6. Benjamin Mañaol. 1968. That in view of all the foregoing. . dated October 28. the Officers and members of the United Nail Workers Union do hereby disauthorize the Petitioner of the above-entitled case (Re:: Lakas ng Manggagawang Makabayan) from further representing the United Nail Workers Union in the above-entitled case...
however. That the alleged officers and members who signed the three (3) Manifestations and Motions are the very employees who were accepted back to work by the respondents during the strike by the complainants on September 4. the Court of Industrial Relations issued an Order deferring the resolution of the Motions until after the trial on the merits. and the refusal of respondents to accept back to work all the individual complainants in this case mentioned in Annexes "A". 2265. 2. 1969. 1967 in this case. . and the said alleged officers and members who signed the said manifestations and motions are still working up to the present in the establishments of the respondents. That complainants respectfully stated that when Charge No.. which fact precisely gave rise to the filing of this case.. 1967. complainant LAKAS filed an Opposition to these Manifestations and Motions. "B". 1967 and November 7. inspite of the offer to return to work by the complainants herein made to the respondents without any conditions at the time of the strike. as per complainants' letter of December 13. 1969.. xxx xxx xxx On January 31. materially alleging that. denied by the court en banc by its Resolution dated March 5. two separate Motions for Reconsideration were filed by the respondent companies and the movant-unions. 3. the alleged officers of the union-movants were not yet officers on the filing of said Charge No. 1967 (Exh. "B" and "C" of the instant complaint. which motions were. for the complainants). 2265 was filed on December 26. To this Order. after the submission of their respective Memoranda on the motions asking for the dismissal and withdrawal of the complaint. giving rise to the instant complaint. to wit: 1. That precisely because of the acceptance back to work of these alleged officers and members of the union-movants. 1968.On November 19.
On the merits of the case. Leonardo Sakdalan. 1970. and. to wit. 1967 strike as well as the November 7. likewise less their earnings elsewhere. nevertheless. without reinstatement. but not beyond June 20. whose contracts expired or who had resigned as above indicated. 1967 strike. their back wages from December l8. and those still working. ordered to pay the individual complainants appearing in Annexes "A". the Decision. on the opinion that the "procedure of scheduling adopted by the respondents was in effect a screening of those who were to be readmitted. as indicated in the body of this Decision. illegal because of lack of the required notices of strike before the strikes were declared in both instances.After the trial on the merits of the case. and were." declared respondent Marcelo Companies guilty of unfair labor practice in discriminating against the employees named in Annexes "A". the respondent court denied the same on the ground that the instant case was filed by the Lakas ng Manggagawang Makabayan for and in behalf of the individual employees concerned and not for the movants who were not authorized by said individual complainants to ask for the dismissal. 1973 the Decision subject of these petitions. therefore. 1967but only up to June 29. respondents should be. 1967 up to the date of their demise. and after submission by the parties of their respective memoranda. therefore. the respondent court rendered on July 20. Jose Roque. and "C" by refusing to admit them back to work other strikers were admitted back to work after the strike of November 7. . 1970 when this case was submitted for decision. Jesus Lim. were dismissed for cause. As to those who died without having been re-employed. "B" and "C" of the Complaint. as they are hereby. WHEREFORE. UNWU and MFWU. in view of all the foregoing. except Arlington Glodeviza. Wilfredo Jarquio. the back wages shall be from December 18. declared guilty of unfair labor practice only for the discrimination on terms or conditions of employment as hereinbefore discussed in connection with the return of the strikers complainants back to work after the second strike. minus their earnings elsewhere for the same period. 1967. On the motions for dismissal or withdrawal of the complaint as prayed for by MUEWA. Alfredo Cabel. while the Decision contained opinions to the effect that the respondent Marcelo Companies were not remiss in their obligation to bargain. The dispositive portion of the appealed Decision states. were economic strikes. "B". and that the September 4.
Assigned as errors are. 1967 strike while others were able to return to their former employment and in holding that the procedure adopted by respondents was in effect a screening of those who were readmitted and in finding respondents guilty of unfair labor practice by reason thereof. The trial court erred in not finding that complainant Lakas ng Manggagawang Makabayan (Lakas) has no authority to file and/or to prosecute the Complaint against respondents in representation of the local unions and/or individual complainants and/or members of local unions in their individual capacities and in not dismissing the complaint on that ground upon motions of the local unions concerned and/or their members. payrolls. Benjamin Pineda. Pablo B. or his duly authorized representative. Atty. SO ORDERED. Atty. 1973. from further representing them and from amicably settling their claims. II. " On August 14. through a newly retained counsel. to wit. vouchers and other pertinent papers or documents as may be necessary to compute the back wages due the individual complainant in line with this Decision. the individual complainants who had earlier disauthorized the counsel of record. Castillon. to wit. . counsel for respondent Marcelo Companies filed a Motion for Reconsideration of the above Decision assigning as errors. is hereby directed to proceed to the premises of respondent companies to examine their books. The trial court erred in finding that respondent discriminated against individual complainants who were not readmitted to work after the November 7. 1973. On August 9. on their own behalf filed their arguments in support of their Motion for Reconsideration. I.The Chief Auditing Examiner of this Court. and to submit his Report thereon not later than twenty (20) days after completion of such examination for further disposition of the Court.
and the discriminatory rehiring of the striking employees after the second strike. II. III. 1967 to be economic strikes and declaring the said strikes illegal for non-compliance with the procedural requirement of Section 14(d) of Republic Act 875. the Court en banc denied the two (2) Motions for Reconsideration filed by both the respondent Marcelo Companies and the individual complainants. although its illegality was condoned or waived because of the Return-to. By Resolution of January 24. the following were assigned as reversible errors.Work agreement on the first strike. The respondent court erred in excluding the other individual complainants. except those who are still working. 1967 as illegal for being an economic strike is not in accordance with law and the facts adduced in this case. On February 19. despite its findings of unfair labor practice against private respondents herein as a consequence of the discriminatory rehiring of the striking employees after the November 7. II. without reinstatement. In L-38258. 1967 to June 29.I. I. and limiting the computation of their backwages from December 18. both parties filed their respective Notices of Appeals. appears to have departed from the substantial evidence rule and established jurisprudence. III. 1974. 4951-ULP. 1970 only. The Honorable trial court in ordering the reduction of the back wages. 1967 strike. 1974. The findings of the trial court excluding some of the employees from the aforementioned Decision as well as from the benefits resulting therefrom is not in accordance with law and the facts. 1974 and on February 20. to wit. these petitions. those who resigned on or before December . The findings of the trial court declaring the strikes of September 4 and November 7. Hence. the petition filed by complainant Lakas ng Manggagawang Makabayan (LAKAS). The respondent court erred in denying reinstatement to the striking complainants in Case No. The respondent court erred in finding the strikes of September 4 and November 7.
and those whose employment contract expired. Marcelo Rubber & Latex Products. III. in L-38260 which is the petition filed by respondents Marcelo Enterprises. minus their earnings elsewhere. 1967 and November 7.18. Marcelo Steel Corporation. Respondent court erred in holding that petitioners herein have waived their right to declare the strikes of September 4. II. From the aforecited assignments of errors respectively made in both petitions before Us. 4951-ULP of respondent court who were not readmitted to work after the November 7. 4951-ULP of respondent court on that ground upon motions of the local unions concerned and/or their officers and members. IV. We find that there are only two basic issues posed for Our resolution. Respondent court erred in rendering judgment ordering petitioners herein to pay individual complainants in Case No. those whose contracts have expired and those who are already working. Marcelo Tire and Rubber Corporation. to wit. and denying to these individual complainants the benefits resulting therefrom. 1970. while others were able to return to their former employment and in holding that the procedure adopted by petitioners herein was in effect a screening of those who were readmitted and in finding petitioners herein guilty of unfair labor practice by reasons thereof. 1967 strike. 4951-ULP of respondent court backwages from December 18. Respondent court erred in not finding that respondent Lakas ng Manggagawang Makabayan (LAKAS) had no authority to file and/or to prosecute the complaint against the petitioners herein in representation of the local unions and/or individual complainants and/or members of local unions in their individual capacities and in not dismissing the complaint in Case No. illegal. except those who have resigned. 1967. viz: (1) whether or not the complaint filed by LAKAS against the Marcelo Companies can . On the other hand. the following is the alleged assignment of errors. those who have been dismissed for cause. to June 29. 1967. Respondent court erred in finding that petitioners herein discriminated against individual complainants in Case No. 1967. Marcelo Chemical & Pigment Corporation. I. and Polaris Marketing Corporation.
"B". in view of the alleged fact that its authority to file and prosecute the same has been squarely raised in issue at the first instance before the respondent court.of all parties concerned as it treats of the merits of the present petitions. Contrary to the pretensions of complainant LAKAS. This reversal is inevitable after this Court has pored through the voluminuous records of the case as well as after applying the established jurisprudence and the law on the matters raised. The first issue poses a procedural question which We shall dwell on after a resolution of the second issue.R. that what had been patently disregarded by the respondent industrial court and the parties alike. What it did was to apprise LAKAS of the existing conflicting demands for recognition as the . No. and (2) whether or not the Marcelo Companies are guilty of unfair labor practice. the appealed Decision is reversed. anent the second issue of whether or not the complaint for unfair labor practice can be sustained. L38258 for not only is there no evidence which shows that the respondent Marcelo Companies were seeking for an opportunity to discharge these employees for union activities. however. 1967. and "C " of the complaint. We are not unmindful of the plight of the employees in this case but We consider it oppressive to grant their petition in G. or to discriminate against them because of such activities. although focus has been greatly placed upon an alleged labor dispute between complainant LAKAS and the respondent Marcelo Companies. It would bear emphasizing. taking into consideration the prayer of LAKAS anent the correct payment of said backwages and the non-exclusion of some employees from the benefits arising from the appealed Decision. The present controversy is a three-sided conflict. this Court rules in favor of the respondent Marcelo Companies and consequently. this latter issue being of greater significance to the correct determination of the rights. for which they should be made liable for backwages and be obliged to reinstate the employees appearing in Annexes "A". Hence. the respondent Marcelo Companies did not ignore the demand for collective bargaining contained in its letter of June 20. is the fact that LAKAS had never been the bargaining representative of any and an of the local unions then existing in the respondent Marcelo Companies. but there is affirmative evidence to establish the contrary conclusion.be sustained. Neither did the companies refuse to bargain at all.
bargaining representative in the appropriate units involved. so was Paulino Lazaro of MUEWA.69 SCRA 132. was demanding of respondent companies to collectively bargain with it. in a situation like this where the issue of legitimate representation in dispute is viewed for not only by one legitimate labor organization but two or more. with whom the existing CBAs were entered into. are forceful and persuasive..C. 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. Espinas & Associates for MACATIFU and the MFWU. PSSLU.. and the complainant LAKAS for MULU which we understand is the aggrupation of MACATIFU. J. . what We said in Philippine Association of Free Labor Unions (PAFLU) vs. " Indeed. 42943 1. A natural consequence of these principles is that the employer has the right to demand of the asserted bargaining . conversely. there is every equitable ground warranting the holding of a certification election. and similarly. Augusta Carreon of MACATIFU itself informed management as late as July 11. 1967 or after the demand of LAKAS that no group representing his Union "is not authorized and should not be entertained.. an employer is under duty to bargain collectively only when the bargaining agent is representative of the majority of the employees. pp. 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. MFWU and UNWU. Jose Roque of UNWU disauthorized the PSSLU from representing his union. "(E)xperience teaches us. On top of all of these. This was not only the legally approved procedure but was dictated by the fact that there was indeed a legitimate representation issue. The above-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. the commentaries in Rothenberg on Labor Relations. The Bureau of Labor Relations. which is that. and suggested the settlement of the issue by means of the filing of a petition for certification election before the Court of Industrial Relations. applies as well to this case. the issue as to who is really the true bargaining representative of all the employees may be firmly settled by the simple expedient of an election. " 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. In this way.
. These concerted activities executed and carried into effect at the instigation and motivation of LAKAS ire 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. that such demand be made in good faith and not merely as a pretext or device for delay or evasion. without the requirement that the bargaining agent be officially certified by the National Labor Relations Board as such. ill-advised and precipitate moves. It is necessary however. . 1967 (although later withdrawn) and the 'two strikes of September 4. We hold that there existed no duty to bargain collectively with The complainant LAKAS on the part of said companies. There are also other facts which this Court cannot ignore. The employer's right is however to reasonable proof. if the informally presented evidence leaves a real doubt as to the issue. . 1967 were calculated . Having the right to demonstration of this fact.agent proof of its representation of its employees. to bargain with it despite the fact that the MUEWA of Paulino Lazaro vas already certified as the sole bargaining agent in said respondent company. In the face of these facts and in conformity with the existing jurisprudence. management and the .. Although an employer has the undoubted right to bargain with a bargaining agent whose authority has been established.. 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. 1967 and November 7. it is not an 'unfair labor practice' for an employer to refuse to negotiate until the asserted bargaining agent has presented reasonable proof of majority representation. the employer has a right to demand a certification and to refuse to negotiate until such official certification is presented. it follows that all acts instigated by complainant LAKAS such as the filing of the Notice of strike on June 13. We rule that the facts neither substantiate nor support the finding that the respondent Marcelo Companies are guilty of unfair labor practice. 1967. 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. And proceeding from this basis." The clear facts of the case as hereinbefore restated indusputably show that a legitimate representation issue confronted the respondent Marcelo Companies.. the complaint of LAKAS charge that after their first strike of September 4.
Complaint). 8.. and gave reference to the casual employees. 1967. 1967 was staged less than a week after the fourth CBA conference and without any benefit of any previous strike notice." (No. In fact. that the respondent Marcelo Companies did not violate the terms of the Return-to-Work Agreement negotiated after the first strike. Nor can it be sustained that the respondent Marcelo Companies bargained in bad faith since there were proposals offered by them. as before. All of these facts show that it was complainant LAKAS. The companies' refusal to accede to the demands of LAKAS appears to be justified since there is no showing that these companies were in the same state of financial and economic affairs. 9.striking employees entered into a Return-to-Work Agreement but that it was violated by the respondent companies who "refused to admit the members of the three striking local unions . it must be stated that the notice of strike filed on June 13. was again lacking of a strike notice. such charge is valid as only against the complainant LAKAS. It is also evident from the records that the charge of bargaining in bad faith imputed to the respondent companies. 1967. 1967 could not have been the strike notice for the first strike because it was already withdrawn on July 14. It is worth considering that the first strike of September 4. It is also alleged that the strike of November 7. that in making these charges. 1967 was then staged immediately after which strike. and as revealed by he records of the case. and refusal of respondents to bargain in good faith with complainant" (No. And that on October 13. There is reason to believe that the first strike was staged only for the purpose of compelling the respondent Marcelo Companies to accede to the inflexible demands of the complainant LAKAS. It is a fact found by the respondent court. All of the strikers were admitted back to work except four (4) who opted not to report for work because of the administrative investigation conducted in connection with the acts of violence perpetrated during the said strike. complainant LAKAS lacked candor.. The records further establish that after the resumption of normal operations following the first strike and the consequent Return-to-Work Agreement. In this connection. from these stated facts can be seen that the first strike was held while the parties were in the process of negotiating. and not . The parties had a total of five (5) conferences for purposes of collective bargaining. Thus. complainant LAKAS sent the final drafts of the collective bargaining proposals for MFWU and UNWU.. but the complainant LAKAS stood pat on its position that all of their economic demands should be met and that all of these demands should be granted in all of the respondent Marcelo Companies. We find however. Complaint). truth and fidelity towards the courts. the striking unions led by complainant LAKAS and the management of the respondent Marcelo Companies resumed their bargaining negotiations. is hardly credible.. The second strike of November 7. 1967 was staged "because of the refusal of the respondents to accept some union members .
the respondent Marcelo Companies. the strikers were required to fill up a form (Exhibit "49") wherein they were to indicate the date of their availability for work. the respondent Marcelo Companies. upholding the contention of petitioner LAKAS that after the second strike. significantly after notice that management did not or could not meet all of their 17-points demand. We find as a fact that the respondent Marcelo Companies did not refuse to reinstate or re. despite the strikers' unconditional offer to return to work. Respondent court. It must be noted that as a consequence of the two strikes which were both attended by widespread acts of violence and vandalism. 1 As indeed 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. the respondent Marcelo Companies had already posted notices for the strikers to return back to work. which refused to negotiate in the pending collective bargaining process. there was refusal to reinstate or re-employ the strikers. the question then confronting Us is whether or not on the part of the respondent companies. or refuse re-employment of members of union who abandon their strike and make unconditional offer to return to work. Exhibit "B" was made. It is true that upon their return.employ the strikers. We do not agree. " declared that although the two strikes were illegal. It would hardly be justiciable to demand of the respondent companies to readmit all the returning workers in . refused to readmit them without "screening" which LAKAS insists to be "discriminatory hiring of the striking employees. nevertheless held the Marcelo Companies guilty of unfair labor practice in discriminating against the complaining employees by refusing to readmit them while other strikers were admitted back to work. being economic strikes held in violation of the strike notice requirement. 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. the businesses of the respondent companies were completely paralyzed. It is clear from the records that even before the unconditional offer to return to work contained in . as a consequence of which We overrule the finding of unfair labor practice against said companies based on the erroneous conclusion )f the respondent court. AR that the facts show is that the bargaining position of complainant LAKAS was inflexible and that it was in line with this uncompromising attitude that the strikes were declared. It is the settled jurisprudence that it is an unfair labor practice for an employer not to reinstate.
the start of work by one without his teammates would necessarily be useless. The stoppage of their work was not. their economic loss should not be shifted to the employer. Some of the machines needed more than one worker to operate them so that in the absence of the needed team of workers. 1942. 123 F 2d. in the case of Royal Interocean Lines.C.. vs. C. like the herein complaining employees. are absolute or be upheld under an circumstances. and the company would be paying for his time spent doing no work. Hudson Motor Car Co. " . so long as employer's supervision is not for the purpose of intimidating or coercing his employees with respect to their self. It is only those strikers who refused or failed to fill-up the required form. Thus. et al. the direct consequence of the respondent companies' complained act.organization and to engage in concerted activities for mutual aid and protection. But what strikes Us most in lending credence to respondents' allegation that Exhibit "49" was not meant to screen the strikers. Even if there was a sincere belief on their part that the requirement of Exhibit "49" was a ruse at "screening" them.one big force or as each demanded readmission. (National Relations Board vs. to wit: 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. There were machines that were not in operating condition because of long disuse during the strikes. 528). Hence. therefore.A. Finally. this fear would have been dispelled upon notice of the fact that each and all of their co-strikers who rued up the required form were in fact scheduled for work and started to work. 3 We cited these authorities giving adequate panoply to the rights of employer. 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.organization and representation. CIR.. who were not scheduled for work and consequently have not been re. is the fact that an of the returning strikers who filled up the form were scheduled for work and consequently started with their jobs. 2 It was never the state policy nor Our judicial pronouncement that the employees' right to self.employed by the respondent Marcelo Companies.
preservation designed to insure peace and order in the employer's premises. L-38260) the respondent Marcelo Companies maintain that the respondent court erred in not dismissing the complaint even as it knew fully well that the very authority of LAKAS to represent the labor unions who had precisely disaffiliated from the LAKAS. was open to serious question and was being ventilated before it. It was an act of a self. but in its effort to prevent the prescribed unfair labor practice.R. it having failed to prove. In their petition (G. M.11471 F2d. We held that the exaction.L. cannot withdraw the said complaint.. We hold and rule that the requirement was an act of selfpreservation." In Pagkakaisang Itinataguyod ng mga Manggagawa sa Ang Tibay (PIMA).. 1940.It is the function of the court to see that the rights of self-organization and collective bargaining guaranteed by the Act are amply secured to the employee. Now to the procedural question posed in the first issue brought about by the respondent court's denial of the motions to withdraw the complaint respectively filed by MUEWA. cannot be considered an unfair labor practice because it was not intended to discourage union membership. Inc.R. of a promise not to destroy company property and not to commit acts of reprisal against union members who did not participate in the strike. et al. . from the strikers returning to work. UNWU and MFWU. Eliseo Samson. 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 "49". et al..C. 264). 1967. vs. May 16. R.A. The lower court's opinion is erroneous. Accordingly. L-22273. substantiate and justify the unfair labor practice charges against the respondent Marcelo Companies.L. C. designed to effect cost-savings as well as to insure peace and order within their premises. that the local unions who were not so authorized by these individual employees. It was also held therein that what the Industrial Peace Act regards as an unfair labor practice is the discrimination committed by the employer in regard to tenure of employment for the purpose of encouraging or discouraging union membership.. by the employer. L38258 should be dismissed. 20 SCRA 45. the court must be mindful of the welfare of the honest employer (Martel Mills Corp. vs. the petition in G. Ang Tibay. On the other hand. No.. the respondent court rationalized the denial of the aforestated motions to withdraw by holding that the complaint was filed by LAKAS on behalf of the individual employees whose names were attached to the complaint and hence.
What appears clearly from the records is that it was Augusto Carreon and his followers who joined LAKAS. 5 We ruled that. the moment MFWU and UNWU separated from and disaffiliated with 'LAKAS to again exercise its rights as independent local unions. headed by Augusta Carreon. it cannot do so because the members constituting this split faction of MUEWA were still members of MUEWA which was on its own right a duly registered labor union. who is being sought to be represented by LAKAS. they are no longer affiliates of LAKAS. However. Naturally. or stated in another way. nevertheless. the said local union was never an affiliate of LAKAS. a labor federation seeks to represent members of a registered local union never affiliated with it and members . that when it filed the charge on December 26. Nor will the lower court's opinion be availing with respect to the complaining employees belonging to UNWU and MFWU.Firstly. the aforestated ruling is applicable. Although it is true. 1967. LAKAS bears no legal interest in representing MUEWA or any of its members. there would no longer be any reason or occasion for LAKAS to continue representing them. any suit to be brought for and in behalf of them can be made only by MUEWA. but then Augusto Carreon was not the recognized president of MUEWA and neither he nor his followers can claim any legitimate representation of MUEWA. as may be inferred from the allegations of the movant unions as well as the counter-allegations of LAKAS filed below. registered before as such. LAKAS cannot bring any action for and in behalf of the employees who were members of MUEWA because. It appearing then that Augusta Carreon and his cohorts did not disaffiliate from MUEWA nor signed any individual affiliation with LAKAS." Under the uncontroverted facts obtaining herein. Apparently. "(a) labor union would go beyond the limits of its legitimate purposes if it is given the unrestrained liberty to prosecute any case even for employees who are not members of any union at all. here. as intimated earlier in this Decision. the only difference being that. as what transpired here. they are bound by the action of the greater majority. they cannot prevail or dictate upon the will of the greater majority of the unions to which they still belong. and not LAKAS. it is this split faction of MUEWA. as alleged by LAKAS.4 In NARIC Workers' Union vs. Notable is the fact that the members purportedly represented by LAKAS constitute the mere minority of the movant unions. CIR. Hence. the officers of the movant unions were not yet then the officers thereof. it appearing that they never disaffiliated from their unions. As such. A suit brought by another in representation of a real party in interest is defective.
of registered local unions which. In fairness to the complaining employees. however. No. 2005] . June 30. This is not to say that the complaining employees were without any venue for redress. fall short of substantiating the charge of unfair labor practice against the respondent Marcelo Companies. Section 12 of the Rules of Court is authorized and should suffice for the purpose. 155690. upon the foregoing considerations. On the other hand. the appeal of the Marcelo Companies in L-38260 must be upheld and sustained. No costs.R. Under the aforestated considerations. disaffiliated from it. The merits of their petition. the petition in L-38258 is dismissed and the petition in L-38260 is granted. A class suit under Rule 3. And We have also treated their petition before Us in the same manner. in the course of the proceedings before the industrial court. WHEREFORE. The decision of the Court of Industrial Relations is hereby REVERSED and SET ASIDE and a new judgment is rendered holding that the respondent Marcelo Companies are not guilty of unfair labor practice. however. [G. as it appears from the verification that the petition in L38258 was for and in behalf of the complaining employees. the respondent court should have directed the amendment of the complaint by dropping LAKAS as the complainant and allowing the suit to be further prosecuted in the individual names of those who had grievances. SO ORDERED. disregarding the fact that LAKAS remained the petitioning party. We treated their Motion for Reconsideration of the Decision subject of appeal as curing the defect of the complaint as the said motion expressly manifested their collective desire to pursue the complaint for and in their own behalves and disauthorizing LAKAS' counsel from further representing them.
is a duly registered labor union acting as the certified collective bargaining agent of the rankand-file employees of petitioner hospital. TRAJANO. sent petitioner a letter requesting a negotiation of their Collective Bargaining Agreement (CBA). vs. 1997. Capitol Medical Center Employees Association-Alliance of Filipino Workers.. HON. entitled “Capitol Medical Center. respondents. as amended. vs. petitioner. Trajano.R. 53479.: For our resolution is the instant petition for review on certiorari under Rule 45 of the 1997 Rules of Civil Procedure. . Inc. respondent. Quezon City. 2001 and the Resolution dated October 18. respondent union. in his capacity as Secretary of the Department of Labor and Employment and Capitol Medical Center Employees Association-AFW. 2002 rendered by the Court of Appeals in CA-G.” The factual antecedents as gleaned from the records are: Capitol Medical Center. assailing the Decision dated September 20. Hon. INC. CRESENCIANO B. in his capacity as Secretary of the Department of Labor and Employment. Ibabao. On October 2.CAPITOL MEDICAL CENTER. and CAPITOL MEDICAL CENTER EMPLOYEES ASSOCIATION-AFW. J. is a hospital with address at Panay Avenue corner Scout Magbanua Street. DECISION SANDOVAL-GUTIERREZ.. Inc. through its president Jaime N. Upon the other hand. SP No. Cresenciano B. petitioner.
on October 29. Subsequently or on October 15. Quisumbing. 1997. the parties failed to reach an amicable settlement. thus: “WHEREFORE.NS-10-453-97. docketed as NCR-OD-9710-006-IRD. 1997. former Labor Secretary Leonardo A. 1997. parties are hereby directed to submit within 10 days from receipt of this Order proposals and counter-proposals leading to the conclusion of the collective bargaining agreement in compliance with aforementioned Resolution of the Office as affirmed by the Supreme Court. Further. Respondent alleged that petitioner’s refusal to bargain constitutes unfair labor practice. respondent filed with the National Conciliation and Mediation Board (NCMB). refused to bargain with respondent. For its part. . docketed as NCMB-NCR. all striking workers are directed to return to work within twenty-four (24) hours from the receipt of this Order and the management to resume normal operations and accept back all striking workers under the same terms and conditions prevailing before the strike. National Capital Region. Consequently. as amended. respondent staged a strike. 1997. On December 4. Department of Labor and Employment. petitioner filed with the Bureau of Labor Relations (BLR). challenging the union’s legitimacy. On November 28. Moreover.In its reply dated October 10. 1997. a petition for cancellation of respondent’s certificate of registration. petitioner. SO ORDERED. this Office assumes jurisdiction over the labor disputes at Capitol Medical Center pursuant to Article 263 (g) of the Labor Code. Despite several conferences and efforts of the designated conciliator-mediator. now Associate Justice of this Court. a notice of strike. issued an Order assuming jurisdiction over the labor dispute and ordering all striking workers to return to work and the management to resume normal operations. parties are directed to cease and desist from committing any act that may exacerbate the situation.” Petitioner then filed a motion for reconsideration but was denied in an Order dated April 27.
The National Labor Relations Commission. in NCR-OD-9710-006-IRD. petitioner filed with this Court a petition for certiorari assailing the Labor Secretary’s Orders. 127422. Pursuant to our ruling in St. Secretary of the Department of Labor and Employment. the Supreme Court made the following pronouncement. for it was the surest way to end the dispute. We find no grave abuse of discretion on the part of respondent Secretary of Labor whose power is plenary and includes the resolution of all controversies arising from the labor dispute. we referred the petition to the Court of Appeals for its appropriate action and disposition. the Appellate Court rendered a Decision affirming the Orders of the Secretary of Labor. Quisumbing and Chemical Worker’s Union (G. We find the same untenable. Meantime. issued an Order denying the petition for cancellation of respondent union’s certificate of registration.R. on October 1. Martin Funeral Home vs. 1998. the Regional Director. In fact. Leonardo A. The power is plenary and discretionary in nature to enable him to effectively and efficiently dispose of the primary dispute. et al. The public respondent acted well within his duty to order the petitioner hospital to bargain collectively. to wit: ‘It is well settled in our jurisprudence that the authority of the Secretary of Labor to assume jurisdiction over a labor dispute causing or likely to cause a strike or lockout in an industry indispensable to national interest includes and extends to all questions and controversies arising therefrom. 2001). 2001. xxx xxx Indeed. April 17. the Hon. No.1998. The Court of Appeals held: “Anent the first issue raised by the petitioner. he was merely following the directive laid . On September 20. 1998.. On June 23. In LMG Chemicals Corporation vs.
SP No. vs. If pending a petition for certification. in his capacity as Director of the Bureau of Labor Relations. Jr. G. President. Lim in his capacity as Regional Director.R. Capitol Medical Center Employees Association-Alliance of Filipino Workers and Capitol Medical Center Incorporated and Dra. x x x. 1998. Bienvenido E. Inc. No. The mere filing of a petition does not ipso facto justify the suspension of negotiation by the employer (Colegio de San Juan de Letran vs.. dismissing the appeal of the petitioner hospital from the said DOLE-NCR’s decision.down by the Supreme Court (Decision dated February 4.R. Hon. Laguesma. Hon. Department of Labor and Employment and Capitol Medical Center Employees Association (CMCEA-AFW). 141471. Undersecretary of the Department of Labor and Employment. xxx xxx Said decision by the regional director was affirmed by the Director of the Bureau of Labor Relations in a resolution dated December 29. Bitonio. xxx xxx In order to allow an employer to validly suspend the bargaining process. Benedictor R. Hon. the collective bargaining is allowed by the Supreme . 2001. Department of Labor and Employment. the petition for cancellation was dismissed by the regional director in a decision dated September 30. 2001. 2000). Thelma Clemente. National Capital Region. 52736) entitled – Capitol Medical Center. 1998. was dismissed in a decision dated January 11. Association of Employees and Faculty of Letran and Eleanor Ambas. Finally. ordering petitioner hospital to collectively bargain with the Capitol Medical Center Employees Association-Alliance of Filipino Workers (private respondent herein) – the certified bargaining agent. the petition for certiorari (docketed as CA-G. there must be a valid petition for certification election. The motion for reconsideration which was subsequently filed was denied on March 23. Maximo B. As earlier mentioned. 1997) in the case of Capitol Medical Center Alliance of Concerned Employees-Unified Filipino Service Workers (CMC-ACE-UFSW) vs. September 18.
the Court of Appeals issued a Resolution denying petitioner’s motion . hereby AFFIRMING the two assailed orders. 1997 and April 27. but at every turn it has been ruled by the various labor administrative officials that the respondent union is legitimate. xxx xxx WHEREFORE. the instant petition is DENIED. Unless and until the Certificate of Registration of the union is cancelled.Court to proceed. with more reason should the collective bargaining (in this case) continue since the High Court had recognized the respondent as the certified bargaining agent in spite of several petitions for cancellation filed against it.” On October 18. premises considered. This Court fails to see any supervening event that would render the execution of the decision of public respondent impossible. We are likewise not persuaded. xxx xxx We are also not convinced by the arguments raised by the petitioner with respect to its third assigned error. 1998. It has failed to convince the labor administrative officials. The petitioner asserts that the respondent union has lost its legitimacy. 2002.’ (page 56 of the Rollo). SO ORDERED. dated December 4. of the public respondent in OS-AJ-0024-97 (NCMB-NCR-NS-10-453-97). We are inclined to agree with the public respondent’s statement that ‘the primary assumption of jurisdiction may be exercised by this Office even without the necessity of prior notice or hearing given to any of the parties disputants. it (union) remains the certified bargaining agent and the Hospital has the duty to enter into a collective bargaining agreement with it. xxx xxx Secondly.
Hon.R. thus: “That there is a pending cancellation proceedings against the respondent Union is not a bar to set in motion the mechanics of collective bargaining. 1997 in Capitol Medical Center Alliance of Concerned Employees-United Filipino Service Worker vs. no less than the Supreme Court already ordered the Hospital to collectively bargain with the Union when it affirmed the resolution of this Office dated November 18. G. more so should the collective bargaining process continue despite its pendency..” Moreover. et al. Unless its certificate of registration and its status as the certified bargaining agent are revoked. Laguesma. issued an Order on October 1. Indeed. Bienvenido E.for reconsideration. 1998 denying the petition for cancellation of respondent’s certificate . Minister of Labor. As aptly stated by the Solicitor General in his comment on the petition. Hence. this petition for review on certiorari. That was the categorical directive of the High Court in its Resolution dated February 4. Petitioner contends that its petition for the cancellation of respondent union’s certificate of registration involves a prejudicial question that should first be settled before the Secretary of Labor could order the parties to bargain collectively. If a certification election may still be ordered despite the pendency of a petition to cancel the union’s registration certificate (National Union of Bank Employees vs. the Secretary of Labor correctly ruled that the pendency of a petition for cancellation of union registration does not preclude collective bargaining. 110 SCRA 274). 1994 directing the management of the Hospital to negotiate a collective bargaining agreement with the Union. L-118915. duty bound to collectively bargain with the Union. the Regional Director. in NCR-OD-9710-006-IRD. as mentioned earlier. the Hospital is. We must emphasize that the majority status of the respondent Union is not affected by the pendency of the Petition for Cancellation pending against it. We are not persuaded. by express provision of the law. No. during the pendency of this case before the Court of Appeals.
as are necessary to insure the proper and adequate . Picketing and Lockouts. it shall be the duty of the striking union or locking-out employer to provide and maintain an effective skeletal workforce of medical and other health personnel. in his opinion. 1999.of registration. clinics or medical institutions. Petitioner also maintains that the Secretary of Labor cannot exercise his powers under Article 263 (g) of the Labor Code without observing the requirements of due process. Strikes. x x x. The Secretary of Labor and Employment or the Commission may seek the assistance of law enforcement agencies to ensure compliance with this provision as well as with such orders as he may issue to enforce the same. Article 263 (g) of the Labor Code. provides: “ART. all striking or locked out employees shall immediately resume operations and readmit all workers under the same terms and conditions prevailing before the strike or lockout. This Order became final and executory and recorded in the BLR’s Book of Entries of Judgments on June 3. as amended. the Secretary of Labor and Employment may assume jurisdiction over the dispute and decide it or certify the same to the Commission for compulsory arbitration. 263. whose movement and services shall be unhampered and unrestricted. In labor disputes adversely affecting the continued operation of such hospitals. Such assumption or certification shall have the effect of automatically enjoining the intended or impending strike or lockout as specified in the assumption or certification order. – xxx xxx (g) When. there exists a labor dispute causing or likely to cause a strike or lockout in an industry indispensable to the national interest. If one has already taken place at the time of assumption or certification.
the President of the Philippines shall not be precluded from determining the industries that.” In Magnolia Poultry Employees Union vs. In such cases. damages and other affirmative relief. xxx x x x. Sanchez. 53479 are AFFIRMED. are indispensable to the national interest. including dismissal or loss of employment status or payment by the locking-out employer of backwages. and from intervening at any time and assuming jurisdiction over any such labor dispute in order to settle or terminate the same. in his opinion. [G. 114974. The foregoing notwithstanding. For this purpose. even criminal prosecution against either or both of them. petitioner’s submissions are bereft of merit. the Secretary of Labor and Employment is mandated to immediately assume. therefore. SO ORDERED. prohibitions and/or injunctions as are issued by the Secretary of Labor and Employment or the Commission. 2004] . within twenty-four (24) hours from knowledge of the occurrence of such a strike or lockout. for the duration of the strike or lockout. most especially emergency cases. the contending parties are strictly enjoined to comply with such orders. WHEREFORE. No. The assailed Decision dated September 20.protection of the life and health of its patients. The rationale for his primary assumption of jurisdiction can justifiably rest on his own consideration of the exigency of the situation in relation to the national interests. 2001 and the Resolution dated October 18. 2002 of the Court of Appeals in CA-G.R. In sum. jurisdiction over the same or certify it to the Commission for compulsory arbitration. June 16.R. under pain of immediate disciplinary action. SP No. we held that the discretion to assume jurisdiction may be exercised by the Secretary of Labor and Employment without the necessity of prior notice or hearing given to any of the parties. Costs against petitioner. the petition is DENIED.
On February 18. D E C I S I O N CALLEJO. petitioner. Eddie L. The Honorable MA. . Divinagracia.. 1994. for brevity). NIEVES R. J. vs.STANDARD CHARTERED BANK EMPLOYEES UNION (NUBE). the Bank and the Union signed a five-year collective bargaining agreement (CBA) with a provision to renegotiate the terms thereof on the third year. in her capacity as SECRETARY OF LABOR AND EMPLOYMENT. The Antecedents Standard Chartered Bank (the Bank. the Union. CONFESOR. 1993 Order of then Secretary of Labor and Employment Nieves R. SR. 1993. respondents. seeking the nullification of the October 29. 1993 and February 10. for brevity) is a foreign banking corporation doing business in the Philippines. Confesor and her resolutions dated December 16. the Union initiated the negotiations. through its President. Included therein was a list of the names of the members of the Union’s negotiating panel. The exclusive bargaining agent of the rank and file employees of the Bank is the Standard Chartered Bank Employees Union (the Union. sent a lettercontaining its proposals covering political provisions and thirty-four (34) economic provisions. Prior to the expiration of the three-year period but within the sixty-day freedom period. In August of 1990. and the STANDARD CHARTERED BANK.: This is a petition for certiorari under Rule 65 of the Rules of Court filed by the Standard Chartered Bank Employees Union.
In a Letter dated February 24, 1993, the Bank, through its Country Manager Peter H. Harris, took note of the Union’s proposals. The Bank attached its counter-proposal to the non- economic provisions proposed by the Union. The Bank posited that it would be in a better position to present its counter-proposals on the economic items after the Union had presented its justifications for the economic proposals. The Bank, likewise, listed the members of its negotiating panel. The parties agreed to set meetings to settle their differences on the proposed CBA.
Before the commencement of the negotiation, the Union, through Divinagracia, suggested to the Bank’s Human Resource Manager and head of the negotiating panel, Cielito Diokno, that the bank lawyers should be excluded from the negotiating team. The Bank acceded. Meanwhile, Diokno suggested to Divinagracia that Jose P. Umali, Jr., the President of the National Union of Bank Employees (NUBE), the federation to which the Union was affiliated, be excluded from the Union’s negotiating panel. However, Umali was retained as a member thereof.
On March 12, 1993, the parties met and set the ground rules for the negotiation. Diokno suggested that the negotiation be kept a “family affair.” The proposed noneconomic provisions of the CBA were discussed first. Even during the final reading of the non-economic provisions on May 4, 1993, there were still provisions on which the Union and the Bank could not agree. Temporarily, the notation “DEFERRED” was placed therein. Towards the end of the meeting, the Union manifested that the same should be changed to “DEADLOCKED” to indicate that such items remained unresolved. Both parties agreed to place the notation “DEFERRED/DEADLOCKED.”
On May 18, 1993, the negotiation for economic provisions commenced. A presentation of the basis of the Union’s economic proposals was made. The next meeting, the Bank made a similar presentation. Towards the end of the Bank’s presentation, Umali requested the Bank to validate the Union’s “guestimates,” especially the figures for the rank and file staff. In the succeeding meetings, Umali chided the Bank for the insufficiency of its counter-proposal on the provisions on salary increase, group hospitalization, death assistance and dental benefits. He reminded the Bank, how the Union got what it wanted in 1987, and stated that if need be, the Union would go through the same route to get what it wanted.
Upon the Bank’s insistence, the parties agreed to tackle the economic package item by item. Upon the Union’s suggestion, the Bank indicated which provisions it would accept, reject, retain and agree to discuss. The Bank suggested that the Union prioritize its economic proposals, considering that many of such economic provisions remained unresolved. The Union, however, demanded that the Bank make a revised itemized proposal.
In the succeeding meetings, the Union made the following proposals:
Wage Increase: 1st Year – Reduced from 45% to 40% 2nd Year - Retain at 20% Total = 60%
Group Hospitalization Insurance: Maximum disability benefit reduced from P75,000.00 to P60,000.00 per illness annually
Death Assistance: For the employee -- Reduced from P50,000.00 to P45,000.00 For Immediate Family Member -- Reduced from P30,000.00 to P25,000.00
Dental and all others -- No change from the original demand.
In the morning of the June 15, 1993 meeting, the Union suggested that if the Bank would not make the necessary revisions on its counter-proposal, it would be best to seek a third party assistance. After the break, the Bank presented its revised counter-proposal as follows:
Wage Increase : 1st Year – from P1,000 to P1,050.00 2nd Year – P800.00 – no change
Group Hospitalization Insurance From: P35,000.00 per illness To : P35,000.00 per illness per year
Death Assistance – For employee From: P20,000.00 To : P25,000.00 Dental Retainer – Original offer remains the same
The Union, for its part, made the following counter-proposal:
Wage Increase: 1st Year - 40% 2nd Year - 19.5%
Group Hospitalization Insurance From: P60,000.00 per year To : P50,000.00 per year
Dental: Temporary Filling/ – P150.00 Tooth Extraction Permanent Filling – 200.00 Prophylaxis – 250.00 Root Canal – From P2,000 per tooth To: 1,800.00 per tooth
Death Assistance: For Employees: From P45. docketed as NCMB-NCR-NS-06380-93. 00-06-04191-93 against the Union on June 28. He suggested that in order to break the impasse. The Union declared a deadlockand filed a Notice of Strike before the National Conciliation and Mediation Board (NCMB) on June 21.00 2nd Year 850.0% Diokno stated that. the Union should prioritize the items it wanted to iron out. docketed as NLRC Case No. Another set of counter-offer followed: Management Wage Increase 1st Year – P1. Diokno requested the Union panel to refrain from involving personalities and to instead focus on the negotiations. aside from the above-quoted. 1993. 1993. in order for the Bank to make a better offer.00 For Immediate Family Member: From P25. He furthered asserted that it would have been easier to bargain if the atmosphere was the same as before. the Union and the Bank failed to agree on the remaining economic provisions of the CBA.00 Union 40% 19.00 to P40.00 to P20. Umali replied that it was impossible to do so because the Bank’s counter-proposal was unacceptable. Divinagracia stated that the Bank should make the first move and make a list of items it wanted to be included in the economic package.000. The Bank alleged that the Union violated its duty to bargain.00.050.000.000. the Union should clearly identify what it wanted to be included in the total economic package. Except for the provisions on signing bonus and uniforms. remained the same. The Union’s original proposals. where both panels trusted each other. On the other hand. as .000. the Bank filed a complaint for Unfair Labor Practice (ULP) and Damages before the Arbitration Branch of the National Labor Relations Commission (NLRC) in Manila.
issued an Order assuming jurisdiction over the labor dispute at the Bank. The complaint for ULP filed by the Bank before the NLRC was consolidated with the complaint over which the SOLE assumed jurisdiction. The Bank’s charge for unfair labor practice which it originally filed with the NLRC as NLRC-NCR Case No.” indicative of blue-sky bargaining. It contended that the Union demanded “sky high economic demands. the SOLE issued an Order on October 29. the Bank suffered nominal and actual damages and was forced to litigate and hire the services of the lawyer.no lockout clause by filing a notice of strike before the NCMB.it did not bargain in good faith. the Union officers should be dismissed. the dispositive portion of which is herein quoted: WHEREFORE. The CBA shall be retroactive to 01 April 1993 and shall remain effective for two years thereafter. 0006-04191-93 is pending for his guidance and appropriate action. On the other hand. pursuant to Article 263(g) of the Labor Code. Further. 00-06-04191-93 but which is deemed consolidated herein. the Standard Chartered Bank and the Standard Chartered Bank Employees Union – NUBE are hereby ordered to execute a collective bargaining agreement incorporating the dispositions contained herein. the Union’s charge for unfair labor practice is similarly dismissed. 1993. Finally. then Secretary of Labor and Employment (SOLE) Nieves R. Let a copy of this order be furnished the Labor Arbiter in whose sala NLRC-NCR Case No. is dismissed for lack of merit. All provisions in the expired CBA not expressly modified or not passed upon herein are deemed retained while all new provisions which are being demanded by either party are deemed denied. Considering that the filing of notice of strike was an illegal act. the Bank alleged that as a consequence of the illegal act. or until such time as a new CBA has superseded it. After the parties submitted their respective position papers. Confesor. The SOLE gave the following economic awards: . On July 21. the Union violated its no strike. but without prejudice to such agreements as the parties may have arrived at in the meantime. 1993.
000.00 6.500.00 3.000. a) c) Group Insurance Hospitalization : P45.00 per month 2.00 per month Fifth year : P400. Medicine Allowance Fourth year : P5.000. Death Assistance .00 b) Accident : P130.500.1.00 Fifth year : P2.000. but without diminishing existing benefits 5.000.00 4. Dental Benefits Provision of dental retainer as proposed by the Bank. Wage Increase: a) To be incorporated to present salary rates: Fourth year : 7% of basic monthly salary Fifth year : 5% of basic monthly salary based on the 4th year adjusted salary b) Additional fixed amount: Fourth year : P600. Optical Allowance Fourth year: P2.00 Fifth year : P6.00 Life : P130.
00 7.a) b) Employee : P30. The Present Petition . On December 16.000. therefore. Citing National Labor Union v. the Union filed a motion for reconsideration with clarification. a) b) Loans Car Loan : P200.000. The need. Thus. which was. explaining that both parties failed to substantiate their claims. 1994. the management is urged to increase the existing and allowable housing loan that the Bank extends to its employees to an amount that will give meaning and substance to this CBA benefit. Immediately thereafter. 1993. the Bank and the Union signed the CBA. denied on February 10. while the Bank filed a motion for reconsideration. Insular-Yebana Tobacco Corporation. On March 22.00 Immediate Family Member : P5. The SOLE dismissed the charges of ULP of both the Union and the Bank. likewise. Emergency Leave – Five (5) days for each contingency 8. the wage increase was effected and the signing bonuses based on the increased wage were distributed to the employees covered by the CBA. Dissatisfied. to improve on this benefit cannot be overemphasized. the SOLE stated that ULP charges would prosper only if shown to have directly prejudiced the public interest.000. The Union filed a second motion for reconsideration. 1994. the SOLE issued a Resolution denying the motions.00 Housing Loan : It cannot be denied that the costs attendant to having one’s own home have tremendously gone up.
damage or injury to the public interest need not be present in order for unfair labor practice to prosper. pointed out that the public respondent failed to rule on the ULP charges arising from the Bank’s surface bargaining. and made bad faith proposals when it announced that the parties should begin from a clean slate. RESPONDENT HONORABLE SECRETARY COMMITTED GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OF JURISDICTION IN FAILING TO RULE ON OTHER UNFAIR LABOR PRACTICES CHARGED.” which had the effect of diminishing or obliterating the gains that the Union had made. likewise. Jr. It argued that the Bank opened the political provisions “up for grabs. the Union filed this petition for certiorari under Rule 65 of the Rules of Procedure alleging as follows: A. It further argued that contrary to the ruling of the public respondent. C. be excluded from the Union’s negotiating panel. The Union alleges that the SOLE acted with grave abuse of discretion amounting to lack or excess of jurisdiction when it found that the Bank did not commit unfair labor practice when it interfered with the Union’s choice of negotiator. Diokno’s suggestion that the negotiation be limited as a “family affair” was tantamount to suggesting that Federation President Jose Umali. 1994. It argued that. . RESPONDENT HONORABLE SECRETARY COMMITTED GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OF JURISDICTION IN DISMISSING THE CHARGES OF UNFAIR LABOR PRACTICES ON THE GROUND THAT NO PROOF OF INJURY TO THE PUBLIC INTEREST WAS PRESENTED.On April 28. The Union. The Union contended that the Bank merely went through the motions of collective bargaining without the intent to reach an agreement. RESPONDENT HONORABLE SECRETARY COMMITTED GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OF JURISDICTION IN DISMISSING THE UNION’S CHARGE OF UNFAIR LABOR PRACTICE IN VIEW OF THE CLEAR EVIDENCE OF RECORD AND ADMISSIONS PROVING THE UNFAIR LABOR PRACTICES CHARGED. B.
making bad faith non. (b) whether or not the public respondent acted with grave abuse of discretion amounting to lack or excess of jurisdiction when she issued the assailed order and resolutions. it was the Union that committed ULP when negotiator Jose Umali. even after a request was made by the Union to validate its “guestimates. the Bank prayed that the petition be dismissed as the Union was estopped. and demanded that she be excluded from the Bank’s negotiating team. The Court’s Ruling . surface bargaining. It asserted that contrary to the Union’s allegations. Jr. and.” In its Comment. (c) whether or not the petitioner is estopped from filing the instant action. in representation of the public respondent. 1994. The Office of the Solicitor General. considering that it signed the Collective Bargaining Agreement (CBA) on April 22. and refusal to furnish the Union with copies of the relevant data. The Issues The issues presented for resolution are the following: (a) whether or not the Union was able to substantiate its claim of unfair labor practice against the Bank arising from the latter’s alleged “interference” with its choice of negotiator. It asserted that the Union failed to prove its ULP charges and that the public respondent did not commit any grave abuse of discretion in issuing the assailed order and resolutions.The Union also accused the Bank of refusing to disclose material and necessary data.economic proposals. hurled invectives at the Bank’s head negotiator. Cielito Diokno. Moreover. the Union engaged in blue-sky bargaining and isolated the no strike-no lockout clause of the existing CBA. prayed that the petition be dismissed.
Diokno approached him and suggested the exclusion of Umali from the Union’s negotiating panel.” Citing the cases of U. and that during the first meeting. Divinagracia executed an affidavit. the alleged ULP was based on the employer’s violation of Section 8(a)(1) and (5) of the National Labor Relations Act (NLRA). Diokno stated that the negotiation be kept a “family affair. stating that prior to the commencement of the negotiation. and the refusal of the employer to bargain collectively with the employees’ representatives. “Interference” under Article 248 (a) of the Labor Code The petitioner asserts that the private respondent committed ULP. In the aforecited cases. Postal Service and Harley Davidson Motor Co.. AMF.. In both cases. interference in the selection of the Union’s negotiating panel. In support of its claim. the Bank’s Human Resource Manager. which pertain to the interference. suggested to the Union’s President Eddie L. Umali. when Cielito Diokno.organization and to bargain collectively through representatives of their own choosing.. Inc.. President of the NUBE.The petition is bereft of merit. i.e.S. be excluded from the Union’s negotiating panel. the Union claims that interference in the choice of the Union’s bargaining panel is tantamount to ULP. Divinagracia that Jose P. or one who is a member or an official of . the National Labor Relations Board held that upon the employer’s refusal to engage in negotiations with the Union for collective-bargaining contract when the Union includes a person who is not an employee. restraint or coercion of the employer in the employees’ exercise of their rights to self. Jr.
 wherein this Court said that the test of whether an employer has interfered with and coerced employees in the exercise of their right to selforganization within the meaning of subsection (a)(1) is whether the employer has engaged in conduct which it may reasonably be said. Ltd. Ltd. .” Workers’ and employers’ organizations shall have the right to draw up their constitutions and rules. Article 2 of ILO Convention No.. it is not necessary that there be direct evidence that any employee was in fact intimidated or coerced by statements of threats of the employer if there is a reasonable inference that antiunion conduct of the employer does have an adverse effect on self-organization and collective bargaining. functioning or administration. 98 pertaining to the Right to Organize and Collective Bargaining. to job organizations of their own choosing without previous authorization. Further.. Under the International Labor Organization Convention (ILO) No. shall have the right to establish and. 87 FREEDOM OF ASSOCIATION AND PROTECTION OF THE RIGHT TO ORGANIZE to which the Philippines is a signatory. tends to interfere with the free exercise of employees’ rights under Section 3 of the Act. subject only to the rules of the organization concerned.other labor organizations. without distinction whatsoever. The Union further cited the case of Insular Life Assurance Co. such employer is engaged in unfair labor practice under Section 8(a)(1) and (5) of the NLRA. “workers and employers. provides: Article 2 1. to elect their representatives in full freedom to organize their administration and activities and to formulate their programs. Insular Life Assurance Co. Workers’ and employers’ organizations shall enjoy adequate protection against any acts or interference by each other or each other’s agents or members in their establishment.. Employees Association – NATU vs.
and Articles 248 and 249 respecting ULP of employers and labor organizations. charitable. . self-employed people. acts which are designed to promote the establishment of workers’ organizations under the domination of employers or employers’ organizations or to support workers’ organizations by financial or other means. 1953. For its part. intermittent and itinerant workers. security of tenure.organization and to form. and just and humane conditions of work would be assured. collective bargaining. In particular. declared it as a policy of the state to afford protection to labor. Article 248(a) of the Labor Code. The aforcited ILO Conventions are incorporated in our Labor Code. shall have the right to self. However. The right to self-organization necessarily includes the right to collective bargaining. particularly in Article 243 thereof. Ambulant.2. the 1987 Constitution. rural workers and those without any definite employers may form labor organizations for their mutual aid and protection. 243. which provides: ART. or assist labor organizations of their own choosing for purposes of collective bargaining. the State had already expressly bestowed protection to labor as part of the general provisions. – All persons employed in commercial. even as early as the 1935 Constitution. and highlights “the principle of shared responsibility” between workers and employers to promote industrial peace. specifying that the workers’ rights to self-organization. considers it an unfair labor practice when an employer interferes. join. emphasizing its mandate to afford protection to labor. The said ILO Conventions were ratified on December 29. aside from making it a policy to “protect the rights of workers and promote their welfare. The 1973 Constitution. COVERAGE AND EMPLOYEES’ RIGHT TO SELF-ORGANIZATION.” devotes an entire section. medical or educational institutions whether operating for profit or not. with the object of placing such organizations under the control of employers or employers’ organizations within the meaning of this Article. on the other hand. restrains or coerces employees in the exercise of their right to self-organization or the right to form association. industrial and agricultural enterprises and in religious.
the negotiations pushed through. The accusation occurred after the arguments and differences over the economic provisions became heated and the parties had become frustrated. The Duty to Bargain . Substantial evidence has been defined as such relevant evidence as a reasonable mind might accept as adequate to support a conclusion. The complaint was made only on August 16. and as a result. with the inclusion of Umali in the Union’s negotiating panel. The records show that after the initiation of the collective bargaining process. It happened after the parties started to involve personalities. 1993 after a deadlock was declared by the Union on June 15. As the public respondent noted. Such is what appears to have happened in this case. the Union bases its claim of interference on the alleged suggestions of Diokno to exclude Umali from the Union’s negotiating panel. 1993. It is clear that such ULP charge was merely an afterthought. suggestions given under less adversarial situations may be colored with unintended meanings. In the case at bar. ULP under Article 248(a) in connection with Article 243 of the Labor Code is committed. substantial evidence is required to support the claim. passions may rise. The circumstances that occurred during the negotiation do not show that the suggestion made by Diokno to Divinagracia is an anti-union conduct from which it can be inferred that the Bank consciously adopted such act to yield adverse effects on the free exercise of the right to self-organization and collective bargaining of the employees. especially considering that such was undertaken previous to the commencement of the negotiation and simultaneously with Divinagracia’s suggestion that the bank lawyers be excluded from its negotiating panel. if an employer interferes in the selection of its negotiators or coerces the Union to exclude from its panel of negotiators a representative of the Union. In order to show that the employer committed ULP under the Labor Code. and if it can be inferred that the employer adopted the said act to yield adverse effects on the free exercise to right to self-organization or on the right to collective bargaining of the employees.Parenthetically.
meetings were set for the settlement of their differences. accepted. The resolution of surface bargaining allegations never presents an easy issue. retained or were open for discussion. both at and away from the bargaining table.Collectively If at all. as evident in the Bank’s counter-proposals. 1993. The Union alleges that the Bank violated its duty to bargain. The minutes of the meetings show that both the Bank and the Union exchanged economic and non-economic proposals and counter-proposals. Thereafter. after indicating the economic provisions it had rejected. and usually such intent can only be inferred from the totality of the challenged party’s conduct both at and away from the bargaining table. It involves the question of whether an employer’s conduct demonstrates an unwillingness to bargain in good faith or is merely hard bargaining. committed ULP under Article 248(g) when it engaged in surface bargaining. as borne by the minutes of the meetings. 1993 to June 15. which tend to show that it did not want to reach an . It explained that of the 34 economic provisions it made. the suggestion made by Diokno to Divinagracia should be construed as part of the normal relations and innocent communications. The determination of whether a party has engaged in unlawful surface bargaining is usually a difficult one because it involves. 1993. the Bank. which are all part of the friendly relations between the Union and Bank. Surface bargaining is defined as “going through the motions of negotiating” without any legal intent to reach an agreement. a question of the intent of the party in question. 1993 do not show that the Bank had any intention of violating its duty to bargain with the Union. at bottom. hence. the Bank only made 6 economic counterproposals. refused to make a list of items it agreed to include in the economic package. The minutes of meetings from March 12. Further. It alleged that the Bank just went through the motions of bargaining without any intent of reaching an agreement. The Union has not been able to show that the Bank had done acts. the latter replied with a list of its counter-proposals on February 24. Records show that after the Unionsent its proposal to the Bank on February 17.
agreement with the Union or to settle the differences between it and the Union. Admittedly, the parties were not able to agree and reached a deadlock. However, it is herein emphasized that the duty to bargain “does not compel either party to agree to a proposal or require the making of a concession.” Hence, the parties’ failure to agree did not amount to ULP under Article 248(g) for violation of the duty to bargain.
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…
In view of the finding of lack of ULP based on Article 248(g), the accusation that the Bank made bad faith provisions has no leg to stand on. The records show that the Bank’s counter- proposals on the non-economic provisions or political provisions did not put “up for grabs” the entire work of the Union and its predecessors. As can be gleaned from the Bank’s counter- proposal, there were many provisions which it proposed to be retained. The revisions on the other provisions were made after the parties had come to an agreement. Far from buttressing theUnion’s claim that the Bank made bad-faith proposals on the non-economic provisions, all these, on the contrary, disprove such allegations.
We, likewise, find that the Union failed to substantiate its claim that the Bank refused to furnish the information it needed.
While the refusal to furnish requested information is in itself an unfair labor practice, and also supports the inference of surface bargaining, in the case at bar, Umali, in a meeting dated May 18, 1993, requested the Bank to validate its guestimates on the data of the rank and file. However, Umali failed to put his request in writing as provided for in Article 242(c) of the Labor Code:
Article 242. Rights of Legitimate Labor Organization…
(c) To be furnished by the employer, upon written request, with the annual audited financial statements, including the balance sheet and the profit and loss statement, within thirty (30) calendar days from the date of receipt of the request, after the union has been duly recognized by the employer or certified as the sole and exclusive bargaining representatives of the employees in the bargaining unit, or within sixty (60) calendar days before the expiration of the existing collective bargaining agreement, or during the collective negotiation;
The Union, did not, as the Labor Code requires, send a written request for the issuance of a copy of the data about the Bank’s rank and file employees. Moreover, as alleged by the Union, the fact that the Bank made use of the aforesaid guestimates, amounts to a validation of the data it had used in its presentation.
No Grave Abuse of Discretion On the Part of the Public Respondent
The special civil action for certiorari may be availed of when the tribunal, board, or officer exercising judicial or quasi-judicial functions has acted without or in excess of jurisdiction and there is no appeal or any plain, speedy, and adequate remedy in the ordinary course of law for the purpose of annulling the proceeding. Grave abuse of discretion implies such capricious and whimsical exercise of judgment as is equivalent to lack of jurisdiction, or where the power is exercised in an arbitrary or despotic manner by reason of passion or personal hostility which must be so patent and gross as to amount to an invasion of positive duty or to a virtual refusal to perform the duty enjoined or to act at all in contemplation of law. Mere abuse of discretion is not enough.
While it is true that a showing of prejudice to public interest is not a requisite for ULP charges to prosper, it cannot be said that the public respondent acted in capricious and whimsical exercise of judgment, equivalent to lack of jurisdiction or excess thereof. Neither was it shown that the public respondent exercised its power in an arbitrary and despotic manner by reason of passion or personal hostility.
Estoppel not Applicable In the Case at Bar
The respondent Bank argues that the petitioner is estopped from raising the issue of ULP when it signed the new CBA.
Article 1431 of the Civil Code provides:
Through estoppel an admission or representation is rendered conclusive upon the person making it, and cannot be denied or disproved as against the person relying thereon.
A person, who by his deed or conduct has induced another to act in a particular manner, is barred from adopting an inconsistent position, attitude or course of conduct that thereby causes loss or injury to another.
In the case, however, the approval of the CBA and the release of signing bonus do not necessarily mean that the Union waived its ULP claim against the Bank during the past negotiations. After all, the conclusion of the CBA was included in the order of the SOLE, while the signing bonus was included in the CBA itself. Moreover, the Union twice filed a motion for reconsideration respecting its ULP charges against the Bank before the SOLE.
The Union Did Not Engage In Blue-Sky Bargaining
We, likewise, do not agree that the Union is guilty of ULP for engaging in blue-sky bargaining or making exaggerated or unreasonable proposals. The Bank failed to show that the economic demands made by the Union were exaggerated or unreasonable. The minutes of the meeting show that the Union based its economic proposals on data of rank and file employees and the
1993 Order and December 16. In sum. vs. 1994 Resolutions of then Secretary of Labor Nieves R. 1993 and February 10. NATIONAL LABOR RELATIONS COMMISSION (NLRC) and PAMBANSANG KILUSAN NG PAGGAWA (KILUSAN). petitioner. SO ORDERED. hold that the Union is not guilty of ULP. No. Ablan and Associates for petitioner. Abdulcadir T. respondents. we find that the latter did not engage in ULP. L-54334 January 22. IN LIGHT OF THE FOREGOING. We. The Petition is hereby DISMISSED. While the approval of the CBA and the release of the signing bonus did not estop the Union from pursuing its claims of ULP against the Bank.: .R. G. 1986 KIOK LOY.prevailing economic benefits received by bank employees from other foreign banks doing business in the Philippines and other branches of the Bank in the Asian region. J. Ibrahim for private respondent. Confesor are AFFIRMED. CUEVAS. we find that the public respondent did not act with grave abuse of discretion amounting to lack or excess of jurisdiction when it issued the questioned order and resolutions. doing business under the name and style SWEDEN ICE CREAM PLANT. likewise. the October 29.
At the same time. The labor arbiter. 1979 which found petitioner Sweden Ice Cream guilty of unfair labor practice for unjustified refusal to bargain. with the Bureau of Labor Relations (BLR) on ground of unresolved economic issues in collective bargaining. For failure however. Thereafter. the Union.Petition for certiorari to annul the decision 1 of the National Labor Relations Commission (NLRC) dated July 20. The pertinent background facts are as follows: In a certification election held on October 3. won and was subsequently certified in a resolution dated November 29. prompting the Bureau of Labor Relations to certify the case to the National Labor Relations Commission (NLRC) for compulsory arbitration pursuant to Presidential Decree No. 1978. 1978. Left with no other alternative in its attempt to bring the Company to the bargaining table. 823. Eliciting no response to the aforesaid request. 1979. Andres Fidelino. 1979. to whom the case was assigned. as amended. of the . 3 and declared the draft proposal of the Union for a collective bargaining agreement as the governing collective bargaining agreement between the employees and the management. the Union furnished 4 the Company with two copies of its proposed collective bargaining agreement. the Union again wrote the Company reiterating its request for collective bargaining negotiations and for the Company to furnish them with its counter proposals. 1978 by the Bureau of Labor Relations as the sole and exclusive bargaining agent of the rank-andfile employees of Sweden Ice Cream Plant (Company for short). on February 14. and more specifically on December 7. 5 Conciliation proceedings then followed during the thirty-day statutory cooling-off period. The Company's motion for reconsideration of the said resolution was denied on January 25. the Pambansang Kilusang Paggawa (Union for short). But all attempts towards an amicable settlement failed. (g) of Article 249 2 of the New Labor Code. set the initial hearing for April 29. Both requests were ignored and remained unacted upon by the Company. in violation of par. filed a "Notice of Strike". it requested the Company for its counter proposals. 1978. a legitimate late labor federation.
the Union submitted its position paper. the respondent Sweden Ice Cream is hereby declared guilty of unjustified refusal to bargain. the Company's representative. On July 18. The Company was directed anew to submit its financial statements for the years 1976. the said hearing was cancelled and reset to another date. and 1978. Ching. When the case was called for hearing on June 4. the draft proposal for a collective bargaining agreement (Exh. 1979 due to the withdrawal of the Company's counsel of record. Rodolfo dela Cruz. 1979. of P.parties to submit their respective position papers as required. in violation of Section (g) Article 248 (now Article 249).D. as amended. considered the case submitted for resolution. "E ") hereto attached and made an integral part of this decision. Atty. (Emphasis supplied) . 1977. who was supposed to be examined. Fortunato Panganiban formally entered his appearance as counsel for the Company only to request for another postponement allegedly for the purpose of acquainting himself with the case. The case was further reset to May 11. failed to appear. 1979. the Company submitted its position paper on May 28. On July 20. On May 24. Atty. Mr. SO ORDERED. He also ruled that the Company has waived its right to present further evidence and. 1978. is hereby declared to be the collective agreement which should govern the relationship between the parties herein. The Company did not. Meanwhile. Meanwhile. the dispositive portion of which reads as follows: WHEREFORE. Atty. therefore. sent by the Union (Private respondent) to the respondent (petitioner herein) and which is hereby found to be reasonable under the premises. 1979. Panganiban then requested for another postponement which the labor arbiter denied. the National Labor Relations Commission rendered its decision. labor arbiter Andres Fidelino submitted its report to the National Labor Relations Commission. 442. Further. 1979 as scheduled. and instead requested for a resetting which was granted.
if requested by either party. Petitioner Company now maintains that its right to procedural due process has been violated when it was precluded from presenting further evidence in support of its stand and when its request for further postponement was denied. designed to stabilize the relation between labor and management and to create a climate of sound and stable industrial peace. its dismissal is in order. 7 The mechanics of collective bargaining is set in motion only when the following jurisdictional . 6 is one of the democratic frameworks under the New Labor Code. that the Collective Bargaining Agreement approved and adopted by the National Labor Relations Commission is unreasonable and lacks legal basis. (g) of the Labor Code makes it an unfair labor practice for an employer to refuse "to meet and convene promptly and expeditiously in good faith for the purpose of negotiating an agreement with respect to wages. the employer. It is a mutual responsibility of the employer and the Union and is characterized as a legal obligation. this Court dismissed the petition for lack of merit. is not under any legal duty to initiate contract negotiation. however. 1981. Petitioner further contends that the National Labor Relations Commission's finding of unfair labor practice for refusal to bargain is not supported by law and the evidence considering that it was only on May 24. Collective bargaining which is defined as negotiations towards a collective agreement. 1980. and finally. however. The petition lacks merit. So much so that Article 249. Upon motion of the petitioner. On August 4. 1979 when the Union furnished them with a copy of the proposed Collective Bargaining Agreement and it was only then that they came to know of the Union's demands. and all other terms and conditions of employment including proposals for adjusting any grievance or question arising under such an agreement and executing a contract incorporating such agreement.Petitioner now comes before Us assailing the aforesaid decision contending that the National Labor Relations Commission acted without or in excess of its jurisdiction or with grave abuse of discretion amounting to lack of jurisdiction in rendering the challenged decision. hours of work. While it is a mutual obligation of the parties to bargain. par. the Resolution of dismissal was reconsidered and the petition was given due course in a Resolution dated April 1. Consequently.
lead to no other conclusion except that it is unwilling to negotiate and reach an agreement with the Union.10 The case at bar is not a case of first impression. It has been indubitably established that (1) respondent Union was a duly certified bargaining agent. for in the Herald Delivery Carriers Union (PAFLU) vs. and undue delay in submitting its financial statements. petitioner Company's approach and attitude-stalling the negotiation by a series of postponements. and (3) a demand to bargain under Article 251. all of which preconditions are undisputedly present in the instant case.. (1) possession of the status of majority representation of the employees' representative in accordance with any of the means of selection or designation provided for by the Labor Code. Court of Industrial Relations 12 wherein it was further ruled that "while the law does not compel the parties to reach an agreement. Petitioner has not at any instance.. 9 Even during the period of compulsory arbitration before the NLRC. (a) of the New Labor Code .preconditions are present. (2) proof of majority representation. accompanied with a copy of the proposed Collective Bargaining Agreement. . the totality of which is indicative of the latter's disregard of. non-appearance at the hearing conducted. it does contemplate that both parties will approach the negotiation with . there can be no doubt that the Union has a valid cause to complain against its (Company's) attitude. to the Company not only once but twice which were left unanswered and unacted upon. and (3) the Company made no counter proposal whatsoever all of which conclusively indicate lack of a sincere desire to negotiate. From the over-all conduct of petitioner company in relation to the task of negotiation. what is enjoined by the Labor Code — to bargain in good faith. evinced good faith or willingness to discuss freely and fully the claims and demands set forth by the Union much less justify its opposition thereto. Herald Publications 11the rule had been laid down that "unfair labor practice is committed when it is shown that the respondent employer. may indicate bad faith and this is specially true where the Union's request for a counter proposal is left unanswered. 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 proposal This doctrine was reiterated anew in Bradman vs. 8 A Company's refusal to make counter proposal if considered in relation to the entire bargaining process. (2) it made a definite request to bargain. par. We are in total conformity with respondent NLRC's pronouncement that petitioner Company is GUILTY of unfair labor practice. namely. and failure to live up to.
To that extent. Petitioner's aforesaid submittal failed to impress Us. utmost deference to its findings of . 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. Hence. 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.an open mind and make a reasonable effort to reach a common ground of agreement As a last-ditch attempt to effect a reversal of the decision sought to be reviewed.D. the claimed denial of due process appeared totally bereft of any legal and factual support. the moves and overall behavior of petitioner-company were in total derogation of the policy enshrined in the New Labor Code which is aimed towards expediting settlement of economic disputes. It did not even bother to furnish or serve the Union with its counter proposal despite persistent requests made therefor. all geared towards bringing the Company to the bargaining table. that it was denied the right to be heard and present its side when the Labor Arbiter denied the Company's motion for further postponement. it must be resolved by the NLRC pursuant to the mandate of P. 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. But an erring party should not be tolerated and allowed with impunity to resort to schemes feigning negotiations by going through empty gestures. much less its argument that once the Collective Bargaining Agreement is implemented. 13 More so. Considering the various postponements granted in its behalf. as amended. As herein earlier stated. this Court is not prepared to affix its imprimatur to such an illegal scheme and dubious maneuvers. petitioner capitalizes on the issue of due process claiming. which authorizes the said body to determine the reasonableness of the terms and conditions of employment embodied in any Collective Bargaining Agreement. 873. Certainly. petitioner had not even honored respondent Union with any reply to the latter's successive letters. 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. 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. The instant case being a certified one.
1996 and December 28. SO ORDERED. 1996.the Meralco Workers Association (MEWA) – to execute a collective bargaining agreement (CBA) for the remainder of the parties’ 1992-1997 CBA cycle. WHEREFORE. 127598.R. No. wherein the Secretary required MERALCO and its rank and file union. [G. the Manila Electric Company (MERALCO) seeks to annul the orders of the Secretary of labor dated August 19. 1980. The temporary restraining order issued on August 27. petitioner.reasonableness of any Collective Bargaining Agreement as the governing agreement by the employees and management must be accorded due respect by this Court. No pronouncement as to costs. MEWA is the duly recognized labor organization of the rank-and-file employees of . D E C I S I O N MARTINEZ. THE HONORABLE SECRETARY OF LABOR LEONARDO QUISUMBING AND MERALCO EMPLOYEES AND WORKERS ASSOCIATION (MEWA). 1999] MANILA ELECTRIC COMPANY. and to incorporate in this new CBA the Secretary’s dispositions on the disputed economic and non-economic issues.: In this petition for certiorari. is LIFTED and SET ASIDE. J. respondents. vs. January 27. the instant petition is DISMISSED.
The NCMB then conducted a series of conciliation meetings but the parties failed to reach an amicable settlement. which. filed an Urgent Petition with the Department of Labor and Employment which was docketed as OS-AJ No. Accordingly. However. 1996. 1996.proposal. MERALCO signified its willingness to re-negotiate through its letter dated October 17. Thereafter. in turn. 1997. On November 10. On September 7. 1996. Faced with the imminence of a strike. the parties failed to arrive at “terms and conditions acceptable to both of them. presented a counter. 1995. MEWA filed a Notice of Strike with the National Capital Region Branch of the National Conciliation and Mediation Board (NCMB) of the Department of Labor and Employment (DOLE) which was docketed as NCMB-NCR-NS-04-152-96. 1995 to November 30. MERALCO on May 2. To speed up the resolution of . 1995.” On April 23. MEWA informed MERALCO of its intention to re-negotiate the terms and conditions of their existing 1992-1997 Collective Bargaining Agreement (CBA) covering the remaining period of two years starting from December 1. 050396 praying that the Secretary assume jurisdiction over the labor dispute and to enjoin the striking employees to go back to work.MERALCO. MEWA submitted its proposal to MERALCO. premises considered. this Office now assumes jurisdiction over the labor dispute obtaining between the parties pursuant to Article 263 (g) of the Labor Code. The Labor Secretary granted the petition through its Order of May 8. collective bargaining negotiations proceeded. on the grounds of bargaining deadlock and unfair labor practices. the dispositive portion of which reads: “WHEREFORE. despite the series of meetings between the negotiating panels of MERALCO and MEWA. 1995 and formed a CBA negotiating panel for the purpose. the parties are here enjoined from committing any act that may exacerbate the situation.
P2. Red Circle Rate (RCR) Allowance.200. the parties submitted their respective memoranda and on August 19.00 for the first year covering the period from December 1.the dispute.P2. is deputized to conduct conciliation conferences between the parties to bridge their differences and eventually hammer out a solution that is mutually acceptable.all RCR allowances (promotional increases that go beyond the maximum range of a job classification salary) shall be integrated into the basic salary of employees effective December 1. He shall be assisted by the Legal Service. ‘Undersecretary Jose M. containing the following awards: “ECONOMIC DEMANDS Wage increase .the integration of the longevity allowance into the basic wage is denied. the parties are also directed to submit their respective Position Papers within ten (10) days from receipt. 1996 to November 30. 1995.” Thereafter. the Secretary resolved the labor dispute through an Order. 1997. Longevity Allowance.the present longevity bonus is maintained but the bonus shall be incorporated into the new CBA. 1996. 1996 . . 1995 to November 30.00 for the second year covering the period December 1. Jr. the present policy is maintained. SO ORDERED. Longevity Increase.300. Espanol.
the company’s present policy is maintained. Group Hospitalization & Surgical Insurance Plan (GHSIP) and Health Maintenance Plan (HMP). Union Leave. In case he opts to let it remain.of MEWA’s officers. he may later on convert it to cash at his retirement or separation. Paternity and Funeral leaves.subsidized dependents increased from three to five dependents.present policy is maintained insofar as the cost sharing is concerned70% for the Company and 30% for MEWA. Birthday Leave . . directors or stewards assigned to perform union duties or legitimate union activity is increased from 30 to 40 Mondays per month. the employee has the option either to convert the excess of 10 days to cash or let it remain as long as he wants.MEWA’s demand for upgrading denied & the company’s present policy is maintained which must be incorporated into the new CBA but scheduled vacation leave may be rounded off to one full day at a time in case of a benefit involving a fraction of a day.the existing policy is to be maintained and must be incorporated in the new CBA unless a new law granting paternity leave benefit is enacted which is superior to what the company has already granted. Vacation Leave .the present reserve of 25 days shall be reduced to 15 days. However. the worker shall be entitled to go on leave with pay on the next working day.union’s demand is granted. Sick leave reserve. those who have not used the sick leave benefit during a particular year shall be entitled to a one-day sick leave incentive. If birthday falls on the employee’s rest day or on a non-working holiday. Maternity.MEWA’s demand for upgrading is denied. Health Maintenance Plan (HMP) for dependents .Sick Leave.
d. those over 70 are entitled to not more than 30 days of hospitalization at the J.MEWA’s demand of one month salary as Christmas Bonus and two month’s salary as Special Christmas Grant is granted and to be incorporated in the new CBA. Christmas Gift Certificate . HMP coverage for retiree’s dependents is denied .company has the discretion as to whether it will give it to its employees. c. e. Anniversary Bonus . with MERALCO subsidizing 100% of the monthly premium. HMP coverage for retirees.F.Longevity Bonus. Christmas Bonus and Special Christmas Grant.HMP coverage is granted to retirees who have not reached the age of 70. Midyear Bonus.00 to P200.is increased from P140. Full retirement-present policy is maintained.union’s demand is denied.one month’s pay to be included in the CBA.00 for every year of service to be received by the employee after serving the Company for 5 years. Cotton Hospital with the company shouldering the entire cost. special retirement leave and allowance-present policy is maintained. one cavan of rice per month is granted to retirees. Retirement Benefits: a. b.
surgical. Shortswing. Monthly pension of P3. .00 to P40. Death benefit for retiree’s beneficiaries is denied. Medical and Hospitalization Benefits. present policy is maintained. Night work. are entitled to this benefit. including free medicine whenever the same is not available at the JFCH.00 for each retiree is denied.00 to be given to those authorized to climb poles up to at least 60 ft.union’s demand is denied.f. Dental.work in another shift within the same day shall be considered as the employee’s work for the following day and the employee shall be given additional four (4) hours straight time and the applicable excess time premium if he works beyond 8 hours in the other shift.000. Resignation benefits.union’s demand is denied. Members of the team including stockman drivers.00 to be given to any employee authorized by the Safety Division to perform work on or near energized bare lines & bus including stockman drivers & crane operators and other crew members on ground. employee is eligible for optional retirement if he has rendered at least 18 years of service.grant of all the allowable medical. Optional retirement . High Pole Allowance.is increased from P30. dental and annual physical examination benefits. from the ground.00 to P55. g.is increased from P45. High Voltage allowance.union demand is denied but present policy must be incorporated in CBA. crane operators and other crew members on the ground.
the present policy shall be maintained.00 .shall be increased effective December 1.from P35.where stockmen drive tow trailers with long poles and equipment on board. 1995 as follows: Breakfast . Benefits for Collectors: a.000. payable in twenty (20) years starting one year from the start of operations.00 .from P35.00 whether they perform the job on regular shift or on overtime. Company shall reduce proportionately the quota and monthly average product level (MAPL) in terms of equivalent bill assignment when an employee is on sick leave and paid vacation leave.00 to P45. Meal and Lodging Allowance.the union demand is denied.is increased to P60. an employee shall receive P60. those who have already availed of the privilege shall be allowed to get the difference.00 to P45.from P135. Employee’s Cooperative.00 Lunch Dinner Lodging .00. b.from P25.Towing Allowance.00 to P180. Sundays and holidays. Holdup Allowance.00 lunch allowance and applicable transportation allowance . When required to work on Saturdays. they shall be entitled to a towing allowance of P20.a loan of P3 M seed money is granted to the proposed establishment of a cooperative.00.00 to P35.00 a night in all MERALCO franchise areas Payroll Treatment for Accident while on Duty. Housing and Equity Assistance Loan. whichever is higher.000.an employee shall be paid his salary and allowance if any is due plus average excess time for the past 12 months from the time of the accident up to the time of full recovery and placing of the employee back to normal duty or an allowance of P2.
reorganization or as a result of operational exigencies. d. Union recognition and security - i. floods. c. The Company shall agree to meet only with Union officers and its authorized . Political Demands: a. The union shall be recognized by the Company as sole and exclusive bargaining representative of the rank-and-file employees included in the bargaining unit. e.the collective bargaining unit shall be composed of all regular rank-and-file employees hired by the company in all its offices and operative centers throughout its franchise area and those it may employ by reason of expansion. earthquakes and other similar force majeure events when it is impossible for a collector to perform collection work. to Collector’s cash bond shall be deposited under his capital contribution MESALA.00 for every delinquent account disconnected.as determined by the Company and shall also receive an additional compensation to one day fixed portion in addition to lunch and transportation allowance. g. Collectors quota and MAPL shall be proportionately reduced during typhoons. The collector shall be entitled to an incentive pay of P25. Collectors shall be provided with bobcat belt bags every year f. When a collector voluntarily performs other work on regular shift or overtime. b. he shall be entitled to remuneration based on his computed hourly compensation and the reimbursement of actually incurred transportation expenses. Scope of the collective bargaining unit.
on company time. The Company shall honor only those individual authorizations . creed. ii. the distance from the employee’s residence shall be considered unless the transfer is accepted by the employee. race. Transfer of assignment and job security- i. But the Company shall not permanently contract out regular or permanent positions that are necessary in the normal operation of the Company. Check off Union Dues. the union shall be informed. The right of all rank-and-file employees to join the union shall be recognized in accordance with the maintenance of membership principle as a form of union security. The union shall meet with the newly regularized employees for a period not to exceed four (4) hours. d. the transfer shall be made within the offices in the same district. No transfer of an employee from one position to another shall be made if motivated by considerations of sex. the Company shall check off such increase from the salaries of union members after the union submits check off authorizations signed by majority of the members. If the transfer is extremely necessary. Personnel hired through agencies or contractors to perform the work done by covered employees shall not exceed one month. to acquaint the new regular employees of the rights. duties and benefits of Union membership. iii. political and religious belief. iii. seniority or union activity. c. If the transfer is due to the reorganization or decentralization. If extension is necessary.where the union increases its dues as approved by the Board of Directors. ii.representatives on all matters involving the Union and all issues arising from the implementation and interpretation of the new CBA.
142 billion. Signing Bonus. p. f. 3 of the Labor Code. as well as a new and improved fringe benefits. Union Representation in Committees.shall be in accordance with Article 223. MERALCO filed a motion for reconsideration alleging that the Secretary of Labor committed grave abuse of discretion amounting to lack or excess of jurisdiction: 1.00 wage increase. 2. Payroll Reinstatement. .signed by the majority of the union members and collectively submitted by the union to the Company’s Salary Administration. 1995. 1996.500.P4. would not be affordable to MERALCO and would imperil its viability as a public utility affected with national interest. On August 30. in ordering the grant of a P4. e.the union is allowed to participate in policy formulation and in the decision-making process on matters affecting their rights and welfare. the Safety Committee and other committees that may be formed in the future.000. a package that is grossly excessive and exorbitant. in awarding to MEWA a package that would cost at least P1.00 per member of the bargaining unit for the conclusion of the CBA Existing benefits already granted by the Company but which are not expressly or impliedly repealed in the new agreement shall remain subsisting and shall be included in the new agreement to be signed by the parties effective December 1. under the remaining two (2) years of the CBA for the rankand-file employees. particularly in the Uniform Committee.
medical. the Secretary issued an Order resolving the parties’ separate motions. short swing and payroll treatment.200. dental and hospitalization benefits. MERALCO filed a supplement to the motion for reconsideration on September 18. decentralized filing of paternity and maternity leaves.’ 4. in granting certain ‘political demands’ presented by the union. alleging that the Secretary of Labor did not properly appreciate the effect of the awarded wages and benefits on MERALCO’s financial viability. 1995 to November 30. MEWA likewise filed a motion asking the Secretary of Labor to reconsider its Order on the wage increase.3. optional retirement. the modifications of the August 19. on the other hand. 5. 1996 Order being highlighted hereunder: 1) Effectivity of Agreement . bonuses.December 1. Second year . On its political demands. leaves.P2.00 per month. in ordering the CBA to be ‘effective December 1995’ instead of August 19. .00 per month. MEWA asked the Secretary to rule its proposal to institute a Code of Discipline for its members and the union’s representation in the administration of the Pension Fund. and those that MERALCO has unilaterally granted to its employees by virtue of voluntary company policy or practice. retirement benefits. on the one hand. Economic Demands 2) Wage Increase: First year - P2. 1995. On December 28.200. 1996 when he resolved the dispute. in ordering the ‘incorporation into the CBA of all existing employee benefits. 1997. 1996.
4) Longevity Bonus . 5) Vacation Leave .P170 per year of service starting from 10 years of continuous service. with the Company complying with the present arrangement and the obligations to retirees as is. 1997. On HMP Coverage for Retirees.The parties ‘maintain the status quo. One sack of rice per quarter of the year shall be given to those retiring between August 19.working day is deleted.the grant of a day off when an employee’s birthday falls on a non. The employee has the option to avail of this cash conversion or to accumulate his sick leave credits up to 25 days for conversion to cash at retirement or separation from the service.3) Integration of Red Circle Rate (RCR) and Longevity Allowance into Basic Salary -the RCR allowance shall be integrated into the basic salary of employees as of August 19. 1996 (the date of the disputed Order).The status quo shall be maintained as to the number of vacation leave but employee’s scheduled vacation may be taken one day at a time in the manner that this has been provided in the supervisory CBA. 7) Birthday Leave .The benefits granted shall be effective on August 19. which is the date the CBA expires and shall apply to those who are members of the bargaining unit at the time the award is made. 8) Retirement Benefits for Retirees . that is.is reduced to 15 days.’ . 1996. the date of the disputed order up to November 30. 1997. 6) Sick Leave Reserve . with any excess payable at the end of the year. 1996 and November 30.
11) Employees’ Cooperative .The original award of P3 million pesos as seed money for the proposed Cooperative is reduced to P1.the original award is deleted. 1976. . 10) GHSIP and HMP for Dependents . 13) Payroll Treatment for Accident on Duty .The number of dependents to be subsidized shall be reduced from 5 to 4 provided that their premiums are proportionately increased.The cost of medicine unavailable at the J. the Company is prohibited from entertaining individuals or groups of individuals only on matters that are exclusively within the domain of the union. 12) Shortswing .9) Medical. Dental and Hospitalization Benefits .The incorporation of a closed shop form of union security in the CBA.F. 15) Union recognition and security . the Company shall furnish the union with a complete list of newly regularized employees within a week from regularization so that the Union can meet these employees on the Union’s and the employee’s own time.The bargaining unit shall be composed of all rank and file employees hired by the Company in accordance with the original Order.Company ordered to continue its present practice on payroll treatment for accident on duty without need to pay the excess time the Union demanded.5 million pesos. Political Demands: 14) Scope of the collective bargaining unit . Cotton Hospital shall be in accordance with MERALCO’s Memorandum dated September 14.
. provided further that if the contracting out involves more than six months. With respect to special assessments. rights and benefits as well as duties. race. the Union must be consulted before its implementation. without the employee’s written consent. age or union activity. 18) Check off of union dues In any increase of union dues or contributions for mandatory activities. If a board resolution is submitted. is reasonably exercised and. political and religious belief.Transfer is a prerogative of the Company but the transfer must be for a valid business reason. Only those check-off authorizations submitted by the union shall be honored by the Company. the Uniform Committee and other committees of a similar nature and purpose involving personnel welfare. creed. 17) Contracting Out . is made in good faith.The Company has the prerogative to contract out services provided that this move is based on valid business reasons in accordance with law. negotiation fees or any other extraordinary fees. made in good faith and must be reasonably exercised. 19) Union Representation in Committees . shall be made if motivated by considerations of sex. the union must submit to the Company a copy of its board resolution increasing the union dues or authorizing such contributions. The CBA shall provide that ‘No transfer of an employee from one position to another.16) Transfer of assignment and job security . the Company shall deduct union dues from all union members after a majority of the union members have submitted their individual written authorizations.The union is granted representation in the Safety Committee. individual authorizations shall be necessary before the company may so deduct the same. attorney’s fees.
. . days h. 4) . Loan for the employees’ cooperative.00 for 1997. Benefits for collectors The 40-day union leave.200. reorganization or as a result of operational exigencies. . i. . b. Rice Subsidy and retirement benefits for retirees. c. 3) . 2) . in expanding the scope of the bargaining unit to all regular rank and file employees hired by the company in all its offices and operating centers and those it may employ by reason of expansion. employees’ cooperative and housing equity assistance loan. and j. Two months Christmas bonus. d. in ordering for a closed shop when his original order for a maintenance of membership arrangement was not questioned by the parties. Integration of the Red Circle Rate Allowance g. petitioner filed this petition contending that the Secretary of Labor gravely abused his discretion: 1). Sick leave reserve of 15 f. .00 for 1996 and P2. . Signing bonus. e.200. . . in awarding wage increases of P2. High pole/high voltage and towing allowance. Social benefits such as GHSIP and HMP for dependents. in awarding the following economic benefits: a. .Dissatisfied.
Both MEWA and the Solicitor General. no reviewable abuse of discretion could have attended the Secretary’s arbitral award because the Secretary complied with constitutional norms in rendering the dispute award. in ordering that Meralco should consult the union before any contracting out for more than six months.” 7) .are valid. Subsequently. . all of which We took into account in the resolution of this case. on behalf of the Secretary of Labor. in ruling for the inclusion of all terms and conditions of employment in the collective bargaining agreement.exercising process to determine if this process was attended by some capricious or whimsical act that constitutes “grave abuse”. . The union posits that the yardstick for comparison and for the . rights and benefits as well as duties. which they did. .5) . both petitioner and private respondent MEWA also filed replies to the opposing parties’ Memoranda. filed their comments to the petition. The union contends that any judicial review is limited to an examination of the Secretary’s decisionmaking/discretion . . The parties were instead required to submit written memoranda.considering that he has both jurisdiction and expertise to make them . . in exercising discretion in determining the retroactivity of the CBA. . this hearing was cancelled due to MERALCO not having received the comment of the opposing parties. 6) . While the case was also set for oral argument on Feb 10. . 8) . The union disputes the allegation of MERALCO that the Secretary abused his discretion in issuing the assailed orders arguing that he acted within the scope of the powers granted him by law and by the Constitution. his findings . in the absence of such abuse. The union’s position is anchored on two premises: First. in decreeing that the union be allowed to have representation in policy and decision making into matters affecting “personnel welfare. 1997. .
for that matter. or. no reversible abuse of discretion attended the Secretary’s decision because the Secretary took all the relevant evidence into account. 263 (g) of the Labor Code to assume jurisdiction over a labor dispute in an industry indispensable to the national interest. and rendered a decision based on the facts and law. interference or reversal when grave abuse of discretion is. and insure their enjoyment of “humane conditions of work” and a “living wage. we go back to basic principles. the principle of distributive justice.” Under this constitutional mandate. To the union. and. 1. The Secretary of Labor’s statutory power under Art. and to determine whether or not there has been a grave abuse of discretion amounting to lack or excess of jurisdiction on the part of any branch or instrumentality of the government. to render an award on compulsory arbitration. 8 of the Constitution mandates. To be sure. judiciously weighed them. Also. these standards include the State policy on the promotion of workers’ welfare. the existence of an executive power alone . every legal power of the Secretary of Labor under the Labor Code.determination of the validity of the Secretary’s actions should be the specific standards laid down by the Constitution itself. . This is particularly true when constitutional norms are cited as the applicable yardsticks since this Court is the final interpreter of the meaning and intent of the Constitution. Second.” and the right of labor to a just share in the fruits of production. the arbitral award should not be reversed given the Secretary’s expertise in his field and the general rule that findings of fact based on such expertise is generally binding on this Court. both organized and unorganized. present. the obligation of the State to protect workers. or is alleged to be. To put matters in proper perspective. does not exempt the exercise of this power from the judicial review that Sec. the right of the State to regulate the use of property. any act of the Executive.cannot exempt the executive action from judicial oversight. Art.whether granted by statute or by the Constitution . This constitutional provision states: “Judicial power includes the duty of the courts of justice to settle actual controversies involving rights which are legally demandable and enforceable. that is attended by grave abuse of discretion is subject to review by this Court in an appropriate proceeding.
 For these reasons . Thus. And we recognize that indeed the constitutional provisions the union cited are State policies on labor and social justice that can serve as standards in assessing the validity of a Secretary of Labor’s actions. i. MEWA implied that we should take great care before reading an abuse of discretion . The natural and ever present limitation on the Secretary’s acts is.in the exercise of its judicial power .and more importantly because a ruling on the breadth and scope of the suggested constitutional yardsticks is not absolutely necessary in the disposition of this case . In this case we believe that the more appropriate and available standard .and one does not require a constitutional interpretation . of course. However.is the main issue that we shall discuss at length below. We have repeatedly held that one of the essential requisites for a successful judicial inquiry into constitutional questions is that the resolution of the constitutional question must be necessary in deciding the case. the question we have to answer in deciding this case is whether the Secretary’s actions have been reasonable in light of the parties positions and the evidence they presented. Additionally. the Constitution.i..we shall not use these yardsticks in accordance with the time-honored practice of avoiding constitutional interpretations when a decision can be reached using non-constitutional standards. we note that these provisions do not provide clear. MEWA’s second premise . This Court is entitled to. in the appreciation of and the conclusions the Secretary drew from the evidence presented. precise and objective standards of conduct that lend themselves to easy application.The extent of judicial review over the Secretary of Labor’s arbitral award is not limited to a determination of grave abuse in the manner of the secretary’s exercise of his statutory powers. In layman’s terms. it too protects the interests of the property owner and employer as well. and must .e.e. We likewise recognize that the Constitution is not a lopsided document that only recognizes the interests of the working man.is simply the standard of reasonableness. that the Secretary duly considered the evidence presented . reasonableness implies the absence of arbitrariness.review the substance of the Secretary’s award when grave abuse of discretion is alleged to exist in the award. in legal parlance. this translates into the exercise of proper discretion and to the observance of due process..
the question we have to answer is one that goes into the substance of the Secretary’s disputed orders: Did the Secretary properly consider and appreciate the evidence presented before him? We find. We.Given the parties’ positions on the justiciability of the issues before us. There may also be grave abuse of discretion where the board.on the part of the Secretary because of his expertise on labor issues and because his findings of fact deserve the highest respect from this Court. therefore. if supported by substantial evidence. are entitled not only to great respect but even to finality. (b) on the inclusion of confidential employees in the rank and file bargaining unit.by extrapolation . we also recognize the possibility that abuse of discretion may attend the exercise of the Secretary’s arbitral functions. and (c) in mandating a union security “closed-shop” regime in the bargaining unit. and not on the thorough examination of the parties’ contending claims that may be present in a court trial and in the face-to-face adversarial process that better insures the proper presentation and appreciation of evidence. This Court has recognized the Secretary of Labor’s distinct expertise in the study and settlement of labor disputes falling under his power of compulsory arbitration.became the basis for the (2nd Year) 1997 award. have no difficulty in accepting the union’s caveat on how to handle a Secretary of Labor’s arbitral award. We begin with a discussion on the wages issue.settled that factual findings of labor administrative officials. which in turn . even the Solicitor General himself considered that the Secretary gravely abused his discretion on at least three major points: (a) on the signing bonus issue. based on our consideration of the parties’ positions and the evidence on record. The Secretary of Labor apparently also acted arbitrarily and even whimsically in considering a number of legal points. tribunal or officer exercising judicial function fails to consider evidence adduced by the parties.  It is also well. particularly with respect to the wage award. that the Secretary of Labor disregarded and misappreciated evidence. The focal point in the consideration of the wage award is the projected net income for 1996 which became the basis for the 1996 wage award. his findings in an arbitration case are usually based on position papers and their supporting documents (as they are in the present case). MERALCO projected that the net operating income for . But at the same time.
000 Net amount left with the Company 2.500 during the last year of the CBA period.949.795.237 “For 1997. projected that the 1996 income would increase by 29% to 35% because the “consumption of electric power is at its highest during the last two quarters with the advent of the Yuletide season.171 Billion. on the other hand.804. the Secretary made the following computations and ordered his disputed wage award: Projected net operating Income for 1996 5. The union. the projected income is P7.612 which can easily absorb the incremental increase of P2.613.200 per month or a total of P4.479.729.961. .000.284.1996 was 14.940 Company’s net operating income 2. while the union placed the 1996 net operating income at 5. Based essentially on these considerations.795 Billion.795 Billion.7% above the 1999 level or a total net operating income of 4.703 Dividends at 1995 rate 1.” The union likewise relied heavily on a newspaper report citing an estimate by an all Asia capital financial analyst that the net operating income would amount to 5.000 Principals and interests 1.571.297 Add: Tax credit equivalent to 35% of labor cost 231.636.426. MERALCO based its projection on the increase of the income for the first 6 months of 1996 over the same period in 1995.
the union projection was based on a speculation of Yuletide consumption that the union failed to substantiate.) We find after considering the records that the Secretary gravely abused his discretion in making this wage award because he disregarded evidence on record.300 per month for the first year and P2. 6. that is . the MERALCO projection had every reason to be reliable because it was based on actual and undisputed figures for the first six months of 1996. we find it a grave abuse of discretion to completely disregard data that is based on actual and undisputed record of financial . he apparently misappreciated this evidence in favor of claims that do not have evidentiary support. 1997 and 1998 respectively. This amount can be the source of an item not found in the above computations but which the Company must provide for. Additionally.200 for the second year will still leave much by way of retained income that can be used for expansion.” (Underscoring ours.263 billion and 5. Where he considered MERALCO’s evidence at all. as against the union’s unsubstantiated Yuletide consumption claim. We conclude that our original award of P2. the All-Asia Capital Report was nothing more than a newspaper report that did not show any specific breakdown or computations. “Considering the expansion plans stated in the Company’s Supplement that calls for capital expenditures of 6 billion. MERALCO adduced evidence in the form of historical consumption data showing that a lengthy consumption does not tend to rise during the Christmas period. To our mind. While the Secretary is not expected to accept the company-offered figures wholesale in determining a wage award.the amount the company can use for expansion. In fact.xxx xxx xxx “An overriding aim is to estimate the amount that is left with the Company after the awarded wages and benefits and the company’s customary obligations are paid. no data or computation of this 10-year stream appear in the record. On the other hand.802 billion for 1996. While the union claimed that its cited figure is based on MERALCO’s 10-year income stream.
00 per month for the second year of the two-year CBA term.00 per month for the first year and another P1.including labor costs . Thus. and industry trends in general. After considering the various factors the parties cited.900. While We do not seek to enumerate in this decision the factors that should affect wage determination. We must also keep in mind that high operating costs will certainly and eventually be passed on to the consuming public as MERALCO has bluntly warned in its pleadings.are subject to State regulation. the Secretary should have properly justified his disregard of the company figures. To our mind. MERALCO’s income and the amount of money available for operating expenses .performance in favor of the third-hand and unfounded claims the Secretary eventually relied upon. the decision maker must always take into account the “public interest” aspects of the case. Merely finding the midway point between the demands of the company and the union. we believe that the interests of both labor and management are best served by a wage increase of P1. In considering a public utility. As a rule.900. At the very least. especially in a public utility like MERALCO. rather than encourage agreement. the best way in approaching this task holistically is to consider the available objective facts. affordability or capacity to pay should be taken into account but cannot be the sole yardstick in determining the wage award. we must emphasize that a collective bargaining dispute such as this one requires due consideration and proper balancing of the interests of the parties to the dispute and of those who might be affected by the dispute. We take note of the “middle ground” approach employed by the Secretary in this case which we do not necessarily find to be the best method of resolving a wage dispute. Our reason for this is that these increases sufficiently protects the interest of the worker as they are roughly 15% of the monthly average salary of . and “splitting the difference” is a simplistic solution that fails to recognize that the parties may already be at the limits of the wage levels they can afford. the company may keep its position artificially low while the union presents an artificially high position. Both parties extensely discussed the factors that the decision maker should consider in making a wage award. including. factors such as the bargaining history of the company. The Secretary should have also reasonably insured that the figure that served as the starting point for his computation had some substantial basis. a “middle ground approach” instead promotes a “play safe” attitude that leads to more deadlocks than to successfully negotiated CBAs. on the fear that a “Solomonic” solution cannot be avoided. where applicable. the trends and amounts of arbitrated and agreed wage awards and the company’s previous CBAs. It may lead to the danger too that neither of the parties will engage in principled bargaining.
00 210.50 337.45 13.16 32.50 1.50 112.00 200.50 482. The records shows that MERALCO.50 972.50 977.00 640.08 17.00 1.00 860.58 18. it has consistently improved their compensation package.50 112.91% 1981 1982 56.377.00 350.437.00 600. MERALCO has granted salary increases through the collective bargaining agreement the amount of which since 1980 for both rank-and-file and supervisory employees were as follows: AMOUNT OF CBA INCREASES CBACOVER AGE RANK-AND-FILE 1980 48. throughout its long years of existence.50 112.040. as a manifestation of its strong commitment to the promotion of the welfare and well-being of its employees.00 370.50 2.100.75 16.50 712.25 TOTAL 1983 1984 1985 TOTAL 1986 1987 1988 TOTAL 1989 SUPERVISORY 230. For instance.50 312.50 432.50 112.73 35.50 337. being within the range that will not disrupt the wage trends in Philippine industries.50 462. while at the same time.00 320.50 112.212.50 DIFFERENCE PERCENT 112.07 10.00 640. was never remiss in its obligation towards its employees.23 53.00 2.50 1.50 52.57 .50 112.14 30.00 AMOUNT 342.00.00 1.50 752.50 322.50 112.They likewise sufficiently consider the employer’s costs and its overall wage structure.50 337.50 112.41 32.P11. In fact.100.600.50 112.
1990 1991 TOTAL 1992 1993 1994 TOTAL 1. and the timing of the grant apparently led the Secretary to the conclusion that what were given were Christmas bonuses given by way of a “company practice” on top of the legally required 13th month pay.00 for 1996 to 1997 which we are granting in the instant case is significantly higher than the total increases given in 1992 to 1994.50 1.350. which is only P3.00 1.38 24.867.442.900.63 25.00 1.50 1.412.” it is easily discernible that the total wage increase of P3.50 1.00 3. CHRISTMAS BONUS MERALCO questions the Secretary’s award of “Christmas bonuses” on the ground that what it had given its employees were special bonuses to mark or celebrate “special occasions. 1. specifically under the column “RANK-AND-FILE.00 1.200.150.00 1.682.937.43 24.50 1.600.50 967.50 332.46 24.200.00 a month.50 337.00 1.50 112.” These grants were given on or about Christmas time. . We now go to the economic issues.50 3.38 8. Thus.65 9.742. or a span of three (3) years.300.400.50 9.50 292.81 Based on the above-quoted table.” such as when the Asia Money Magazine recognized MERALCO as the “best managed company in Asia.312.50 342.900. the Secretary’s grant of P2.00 monthly wage increase in the assailed order is unreasonably high a burden for MERALCO to shoulder.00 3.800.50 112.50 4.
500.” It is MERALCO’s position that the Secretary erred when he recognized that there was an “established practice” of giving a two-month Christmas bonus based on the fact that bonuses were given on or about Christmas time. the amounts of bonuses given differed. to wit: “We note that each of the grant mentioned in the commonly adopted table of grants has a special description. the Company explained the reason for the 1995 bonuses and this explanation was not substantially contradicted by the Union. In 1988. The use of “Christmas bonus” title stopped after 1989. It points out that the “established practice” attributed to MERALCO was neither for a considerable period of time nor identical in either amount or purpose. it was P1.The Secretary in granting the two-month bonus. the act of giving this bonus in the spirit of Christmas has ripened into a Company practice. considered the following factual finding. Regardless of its nomenclature and purpose. . The purpose and title of the grants were never the same except for the Christmas bonuses of 1988 and 1989. it was ½ month salary. “xxx xxx xxx “The Company is not therefore correct in its position that there is not established practice of giving Christmas bonuses that has ripened to the status of being a term and condition of employment. We do not agree. these awards were not given uniformly as Christmas bonuses or special Christmas grants although they may have been given at or about Christmas time. Christmas bonuses were given in 1988 and 1989. In 1989. However. and were not in the same amounts. Significantly. The grants thereafter bore different titles and were for varying amounts. In 1990. “What comes out from all these is that while the Company has consistently given some amount by way of bonuses since 1988. what was given was a “cash gift” of ½ month’s salary.
and must be shown to have been consistent and deliberate. aside from complying with the regular 13th month bonus. Thus we have ruled in National Sugar Refineries Corporation vs. however. The considerable length of time MERALCO has been giving the special grants to its employees indicates a unilateral and voluntary act on its part. it may nevertheless be granted on equitable consideration as when the giving of such bonus has been the company’s long and regular practice. has further been giving its employees an additional Christmas bonus at the tail-end of the year since 1988. the record shows the MERALCO.” the giving of the bonus should have been done over a long period of time. is sufficient. a bonus is not a demandable and enforceable obligation. To be considered a “regular practice.” In the case at bar. it can not be denied that these were given voluntarily and continuously on or about Christmas time. to continue giving said benefits knowing that such act was not required by law. affirm the Secretary’s award of a two-month special Christmas bonus to the employees since there was no recognized company practice of giving a two-month special grant. Indeed. While the special bonuses differed in amount and bore different titles. the giving of the special bonus can no longer be withdrawn by the company as this would amount to a diminution of the employee’s existing benefits. a company practice favorable to the employees has been established and the payments made by MERALCO pursuant thereto ripened into benefits enjoyed by the employees. . We can not. The two-month special bonus was given only in 1995 in recognition of the employees’ prompt and efficient response during the calamities. We believe. NLRC: “The test or rationale of this rule on long practice requires an indubitable showing that the employer agreed to continue giving the benefits knowing fully well that said employees are not covered by the law requiring payment thereof. this being merely a generous act on the part of MERALCO.As a rule. Consequently. a one-month special bonus. Instead.
This ruling was reconsidered based on the position that retirees are no longer employees of the company and therefore are no longer bargaining members who can benefit from a compulsory arbitration award.. while the union maintains that MERALCO controls these funds and may therefore be compelled to improve this benefit in an arbitral award. 1997 (i. In the absence of any evidence on record indicating the nature of the retirement fund’s legal personality.e. to improve retirement benefits since retirement is a term or condition of employment that is a mandatory subject of bargaining. MERALCO control over these funds means that MERALCO may be compelled in the compulsory arbitration of a CBA deadlock where it is the employer. The existence of a separate and independent juridical entity which controls an irrevocable retirement trust fund means that these retirement funds are beyond the scope of collective bargaining: they are administered by an entity not a party to the collective bargaining and the funds may not be touched without the trustee’s conformity. we rule that the issue should be remanded to the Secretary for reception of evidence as whether or not the MERALCO retirement fund is a separate and independent trust fund. however.2. On the other hand. The company alleges that a separate and independent trust fund is the source of retirement benefits for MERALCO retirees. The question squarely brought in this petition is whether the Secretary can issue an order that binds the retirement fund. The issue requires a finding of fact on the legal personality of the retirement fund. ruled that all members of the bargaining unit who retire between August 19. rice subsidy and medical benefits of MERALCO retirees. The Secretary. 1996 and November 30. EMPLOYEES’ COOPERATIVE . 3. the term of the disputed CBA under the Secretary’s disputed orders) are entitled to receive an additional rice subsidy. RICE SUBSIDY and RETIREMENT BENEFITS for RETIREES It appears that the Secretary of Labor originally ordered the increase of the retirement pay.
have been the subject of previous rulings from this Office as bargainable matters. In the absence of such legal requirement. we agree with the Secretary’s ruling: “x x x Additionally and more importantly. R.5 million loan to MERALCO employees for the formation of a cooperative.The Secretary’s disputed ruling requires MERALCO to provide the employees covered by the bargaining unit with a loan of 1. We do not see any reason why MERALCO should not now bargain on these benefits. aside from being contributory plans. Furthermore. The formation of a cooperative is a purely voluntary act under this law. that employees can use to form a cooperative.” Moreover. HMP BENEFITS FOR DEPENDENTS and HOUSING EQUITY LOAN MERALCO contends that it is not bound to bargain on these benefits because these do not relate to “wages. we cannot do any less and must recognize that GHSIP and HMP are matters where the union can demand and negotiate for improvements within the framework of the collective bargaining system. the Secretary has no basis to order the grant of a 1.that requires employers to provide funds. by loan or otherwise.A. The GHSIP. Thus. MERALCO have long been extending these benefits to the employees and their dependents that they now become part of the terms and conditions of . to be a term or condition of employment that can be imposed on the parties on compulsory arbitration. and no party in any context or relationship is required by law to set up a cooperative or to provide the funds therefor. in the absence of an agreement by the collective bargaining parties that this is a bargainable term or condition of employment. GHSIP and HMP. At this point. we do not see the formation of an employees cooperative. hours of work and other terms and conditions of employment” hence.whether expressed or implied .5 Million as seed money for the employees formation of a cooperative under the Cooperative Law. 4. HMP benefits for dependents and the housing equity loan have been the subject of bargaining and arbitral awards in the past. GHSIP. the denial of these demands cannot result in a bargaining impasse. 6938. We see nothing in this law .
5. 6. to our mind. With regard to the increase of the housing equity grant.000. This is more so where the signing bonus is in the not insignificant total amount of P16 Million. As an allowance. that is granted by the company to an employee who is promoted to a higher position grade but whose actual basic salary at the time of the promotion already exceeds the maximum salary for the position to which he or she is promoted. not included in the basic salary. Hence. In fact. In the present case. it applies only to specifics . MERALCO even pledged to continue giving these benefits. a signing bonus is justified by and is the consideration paid for the goodwill that existed in the negotiations that culminated in the signing of a CBA. this goodwill does not exist. we agree with the positions commonly taken by MERALCO and by the Office of the Solicitor General that the signing bonus is a grant motivated by the goodwill generated when a CBA is successfully negotiated and signed between the employer and the union.employment. SIGNING BONUS On the signing bonus issue. the payment of a signing bonus cannot be justified and any order for such payment. In the words of the Solicitor General: “When negotiations for the last two years of the 1992-1997 CBA broke down and the parties sought the assistance of the NCMB. these benefits should be incorporated in the new CBA. constitutes grave abuse of discretion. Without the goodwill. xxx. we find P60. and when petitioner MERALCO bluntly invoked the jurisdiction of the Secretary of Labor in the resolution of the labor dispute. whatever goodwill existed between petitioner MERALCO and respondent union disappeared.” In contractual terms.00 reasonable considering the prevailing economic crisis. RED-CIRCLE-RATE ALLOWANCE An RCR allowance is an amount. but which failed to reconcile their differences.
we affirm the Secretary’s order on the integration of the RCR allowance in the basic salary of the employees. contending that the sick leave reserve of 15 days has reached the lowest safe level that should be maintained to give employees sufficient buffer in the event they fall ill. the integration of the RCR allowance was recognized. 1995 shall be integrated in the basic salary of the covered employees who as of such date are receiving such allowance. Thereafter. The latter admits that “the diminution of this reserve does not seriously . beneficial to MERALCO.” For purposes of uniformity.individuals whose salary levels are unique with respect to their new and higher positions. the company rules on RCR allowance shall continue to be observed/applied. This arrangement is. 7. SICK LEAVE RESERVE OF 15 DAYS MERALCO assails the Secretary’s reduction of the sick leave reserve benefit from 25 days to 15 days. in fact. It is for these reasons that MERALCO prays that it be allowed to maintain the RCR allowance as a separate benefit and not be integrated in the basic salary. Thus. In fact. The integration of the RCR allowance in the basic salary of the employees had consistently been raised in the past CBAs (1989 and 1992) and in those cases. We find no compelling reason to deviate from the Secretary’s ruling that the sick leave reserve is reduced to 15 days. The employee has the option to avail of this cash conversion or to accumulate his sick leave credits up to 25 days for conversion to cash at his retirement or separation from the service. in the 1995 CBA between MERALCO and the supervisory union (FLAMES). We do not see any reason why it should not be included in the present CBA. with any excess convertible to cash at the end of the year. Sec. 4 of the CBA provides: “All Red-Circle-Rate Allowance as of December 1. the Secretary decreed the integration of the RCR allowance in the basic salary.
to our mind.00).” 8.00 to P40. it may be to MERALCO’s financial interest to pay these leave credits now under present salary levels than pay them at future higher salary levels. The personnel concerned will not receive any additional risk during the life of the current CBA that would justify the increase demanded by the union. They are not granted to a team because some members of the team are exposed to the given risks. conduct referendum on union matters and other unionrelated matters in furtherance of union objectives. Furthermore. then these personnel deserve only the same salary increase that all other members of the bargaining unit will get as a result of the disputed CBA. The thirty (30) days union leave granted by the Secretary.00). In fact. 40-DAY UNION LEAVE MERALCO objects to the demand increase in union leave because the union leave granted to the union is already substantial. and towing allowance is justified considering the heavy risk the employees concerned are exposed to. conventions and conferences where union representation is required or necessary. constitute sufficient time within which the union can carry out its union activities such as but not limited to the election of union officers. MERALCO likewise assails the grant of the high voltage/high pole allowance to members of the team who are not exposed to the high voltage/high pole risks. The high- . 9. meetings. selection or election of appropriate bargaining agents. The risks that justify the higher salary and the added allowance are personal to those who are exposed to those risks. the union already enjoys a special union leave with pay for union authorized representatives to attend work education seminars. The increase in the high-voltage allowance (from P45. stewards and representatives for purpose of handling or processing grievances. and Paid-Time-off for union officers. high-pole allowance (from P30. It argues that the union has not demonstrated any real need for additional union leave. In the absence of such risk. HIGH VOLTAGE/HIGH POLE/TOWING ALLOWANCE MERALCO argues that there is no justification for the increase of these allowances.affect MERALCO because whatever is in reserve are sick leave credits that are payable to the employee upon separation from service.00 to P55.
There is no need to further reduce this. no pay. The reason is obvious. while the high-pole allowance is given to those authorized to climb poles on a height of at least 60 feet from the ground to work thereat. however. These increases are not even commensurate to the danger the employees concerned are subjected to. (b) disconnection fee for delinquent accounts. To award them the said allowances would be manifestly unfair for the company and even to those who are exposed to the risks. reasonable considering the risks taken by the company personnel involved. . on the other hand. it is imperative to give them these additional allowances for taking additional risks.no risk. (c) voluntary performance of other work at the instance of the Company. The towing allowance. no increase has been given by the company since 1992. We do not. the nature of the employees’ functions and responsibilities and the prevailing standard of living. is granted to the stockman drivers who tow trailers with long poles and equipment on board. and (e) reduction of quota and MAPL during typhoons and other force majeure events. (d) bobcat belt bags. subscribe to the Secretary’s order granting these allowances to the members of the team who are not exposed to the given risks. 10. We have considered the arguments of the opposing parties regarding these benefits and find the Secretary’s ruling on the (a) lunch allowance. BENEFITS FOR COLLECTORS MERALCO opposes the Secretary’s grant of benefits for collectors on the ground that this is grossly unreasonable both in scope and on the premise it is founded.voltage allowance is granted to an employee who is authorized by the company to actually perform work on or near energized bare lines and bus. Based on the nature of the job of these concerned employees. Besides. as well as to the other members of the bargaining unit who do not receive the said allowances. We do not however subscribe to the Secretary’s award on the following: (a) Reduction of quota and MAPL when the collector is on sick leave because the previous CBA has already provided for a reduction of this demand.
precisely because of a conflict in those interests.A. We grant the union demand. Scope of the collective bargaining unit. we ruled that: “Put another way.(b) Deposit of cash bond at MESALA because this is no longer necessary in view of the fact that collectors are no longer required to post a bond. in Metrolab Industries vs. the confidential employee does not share in the same “community of interest” that might otherwise make him eligible to join his rank and file co-workers. The law is that only managerial employees are excluded from any collective bargaining unit and supervisors are now allowed to form their own union (Art. reorganization or as a result of operational exigencies. The union is demanding that the collective bargaining unit shall be composed of all regular rank and file employees hired by the company in all its offices and operating centers through its franchise and those it may employ by reason of expansion. 1. 254 of the Labor Code as amended by R. We ruled: .” Both MERALCO and the Office of the Solicitor General dispute this ruling because if disregards the rule We have established on the exclusion of confidential employee from the rank and file bargaining unit.” Thus. Roldan-Confesor. 6715). In Pier 8 Arrastre vs. Confesor and General Maritime and Stevedores Union. We shall now resolve the non-economic issues. SCOPE OF THE BARGAINING UNIT The Secretary’s ruling on this issue states that: “a.
it is clear that employees holding a confidential position are prohibited from joining the union of the rank and file employees. Towards this end. Additionally.that the Secretary’s order should exclude the confidential employees from the regular rank and file employees qualified to become members of the MEWA bargaining unit. the Company shall not entertain any individual or group of individuals on matters within the exclusive domain of the Union. Union recognition and security. We grant the same in accordance with the maintenance of membership principle as a form of union security. Accordingly." The Secretary reconsidered this portion of his original order when he said in his December . ISSUE OF UNION SECURITY The Secretary in his Order of August 19. hours of work and other terms and conditions of employment. the Company shall agree to meet only with the Union officers and its authorized representatives on all matters involving the Union as an organization and all issues arising from the implementation and interpretation of the new CBA.“……. The union is proposing that it be recognized by the Company as sole and exclusive bargaining representative of the rank and file employees included in the bargaining unit for the purpose of collective bargaining regarding rates of pay. xxx xxx xxx These demands are fairly reasonable. wages. the Union is demanding that the right of all rank and file employees to join the Union shall be recognized by the Company. For this reason.. 1996. all rank and file employees shall join the union.” From the foregoing disquisition. 2. ruled that: “b.
the Secretary in the first instance expressly stated that a maintenance of membership clause should govern. and that despite the parties clear acceptance of the Secretary’s first ruling. An examination of the records of the case shows that the union did not ask for a closed shop security regime. The distinctions between a maintenance of membership regime from a closed shop and their consequences in the relationship between the union and the company are well established and need no further elaboration. Under these circumstances. NLRC. 1996 which neither party disputed.28. it is indubitably clear that the Secretary gravely abused his discretion when he ordered a union shop in his order of December 28. In Ferrer v. We agree with MERALCO’s contention. 224 SCRA 410. citing Lirag v. (b) there is no evidence presented that would justify the restriction on employee's union membership.” MERALCO objected to this ruling on the grounds that: (a) it was never questioned by the parties. 1996. and (c) the Secretary cannot rule on the union security demand because this is not a mandatory subject for collective bargaining agreement. Consequently. 1996 order that: “x x x. we were actually decreeing the incorporation of a closed shop form of union security in the CBA between the parties. when we decreed that all rank and file employees shall join the Union. 109 SCRA 87. the Secretary motu proprio reconsidered his maintenance of membership ruling in favor of the more stringent union shop regime. We rule that the maintenance of membership regime should govern at MERALCO in accordance with the Secretary’s order of August 19. Blanco. the Supreme Court ruled that a CBA provision for a closed shop is a valid form of union security and is not a restriction on the right or freedom of association guaranteed by the Constitution. neither MERALCO nor MEWA raised the issue of union security in their respective motions for reconsideration of the Secretary’s first disputed order. .
We recognize that contracting out is not unlimited. we are for the general limitations we have stated above because they will allow a calibrated response to specific future situations the company and the union may face. Given these realities. the greater risk with this type of limitation is that it will tend to curtail rather than allow the business growth that the company and the union must aspire for. THE CONTRACTING OUT ISSUE This issue is limited to the validity of the requirement that the union be consulted before the implementation of any contracting out that would last for 6 months or more. MERALCO has its legally defined and protected management prerogatives while workers are guaranteed their own protection through specific labor provisions and the recognition of limits to the exercise of management prerogatives.” Additionally. 1-25). Sections. we recognize that a balance already exist in the parties’ relationship with respect to contracting out. 1997.3. rather. From these premises. we can only conclude that the Secretary’s added requirement only introduces an imbalance in the parties’ collective bargaining relationship on a matter that the law already sufficiently . 10. Hence. Proceeding from our ruling in San Miguel Employees Union-PTGWO vs Bersamina. As we have previously held. The Labor Code and its implementing rules also contain specific rules governing contracting out (Department of Labor Order No. the company can determine in its best business judgment whether it should contract out the performance of some of its work for as long as the employer is motivated by good faith. To our mind. We note that the Secretary himself has considered that management should not be hampered in the operations of its business when he said that: ‘We feel that the limitations imposed by the union advocates are too specific and may not be applicable to the situations that the company and the union may face in the future. May 30. (where we recognized that contracting out of work is a proprietary right of the employer in the exercise of an inherent management prerogative) the issue we see is whether the Secretary’s consultation requirement is reasonable or unduly restrictive of the company’s management prerogative. and the contracting out must not have been resorted to circumvent the law or must not have been the result of malicious or arbitrary action. it is a prerogative that management enjoys subject to well-defined legal limitations.
R. being unreasonable. Uniform Committee and other committees of a similar nature. such participation by the Union in the said committees is not in the nature of a comanagement control of the business of MERALCO. duties and welfare. August 13. It reiterates what the Article 211 (A)(g) of the Labor Codes provides: “To ensure the participation of workers in decision and policy-making processes affecting their rights. Thus. al. the Company must welcome this development (see also PAL v.regulates. It is worthwhile to note that all the Union demands and what the Secretary’s order granted is that the Union be allowed to participate in policy formulation and decision-making process on matters affecting the Union member’s right. 85985. NLRC. 1996. Certainly. there is no impairment of management prerogatives. So. that the committees referred to here are the Safety Committee. the Uniform Committee and other committees of a similar nature and purpose involving personnel welfare. however. What is granted by the Secretary is participation and representation. Hence. we rule that the Secretary’s added requirement. restrictive and potentially disruptive should be struck down. . And this can only be done when the Union is allowed to have representatives in the Safety Committee.” We do not find merit in MERALCO’s contention that the above-quoted ruling of the Secretary is an intrusion into the management prerogatives of MERALCO. The union’s participation in such committees might just be the opportune time for dormant ideas to come forward. G. to wit: “We see no convincing reason to modify our original Order on union representation in committees. rights and benefits as well as duties. UNION REPRESENTATION IN COMMITTEES As regards this issue. duties and welfare as required in Article 211 (A)(g) of the Labor Code. 1995). ‘Denying this opportunity to the Union is to lay the claim that only management has the monopoly of ideas that may improve management strategies in enhancing the Company’s growth. What every company should remember is that there might be one among the Union members who may offer productive and viable ideas on expanding the Company’s business horizons. It must be understood.. et. 4. We quote with approval the holding of the Secretary in his Order of December 28.
we are constrained to rule that only the terms and conditions already existing in the current CBA and was granted by the Secretary (subject to the modifications decreed in this decision) should be incorporated in the CBA. MERALCO also assails the Secretary’s order that the effectivity of the new CBA shall retroact to December 1.5.” claiming that the above-quoted ruling intruded into the employer’s freedom to contract by ordering the inclusion in the new CBA all other benefits presently enjoyed by the employees even if they are not incorporated in the new CBA. This retroactive date. INCLUSION OF ALL TERMS AND CONDITIONS IN THE CBA MERALCO also decries the Secretary’s ruling in both the assailed Orders that- “All other benefits being enjoyed by the company’s employees but which are not expressly or impliedly repealed in this new agreement shall remain subsisting and shall likewise be included in the new collective bargaining agreement to be signed by the parties effective December 1. 6. nor presented as issues before the Secretary. To avoid the possible problems that the disputed orders may bring. RETROACTIVITY OF THE CBA Finally. We agree with MERALCO. 1995. nor were part of the previous CBA’s between the parties. was never discussed and agreed upon in the negotiations. and that the Secretary’s disputed orders should accordingly be modified. the date of the commencement of the last two years of the effectivity of the existing CBA. terms and conditions that the law and the parties did not intend to be reflected in their CBA. MERALCO . 1995. The Secretary acted in excess of the discretion allowed him by law when he ordered the inclusion of benefits. This matter of inclusion. MERALCO argues.
i. Torres. while “x x x [A]ll other provisions of the Collective Bargaining Agreement shall be renegotiated not later than 3 years after its execution. If such agreement is entered into beyond 6 months. Pier 8. is contrary to the ruling of this Court in Pier 8 Arrastre and Stevedoring Services.” It is in this re-negotiation that gives rise to the present CBA deadlock. Roldan. MEWA also contends that if the arbitral award takes effect on the date of the Secretary Labor’s ruling on the parties’ motion for reconsideration (i. . neither party took into account the factors necessary for a proper resolution of this aspect.e. x x x. vs.e.. does not involve a mid-term negotiation similar to this case.Confessor which mandates that the effective date of the new CBA should be the date the Secretary of Labor has resolved the labor disputes. Any agreement on such other provisions of the Collective Bargaining Agreement entered into within 6 months from the date of expiry of the term of such other provisions as fixed in such Collective Bargaining Agreement shall retroact to the day immediately following such date. while St. the rule that although a CBA has expired.. vs. Inc. Lukes Medical Center. Inc. What the law additionally requires is that a CBA must be renegotiated within 3 years “after its execution. MEWA supports the ruling of the Secretary on the theory that he has plenary power and discretion to fix the date of effectivity of his arbitral award citing our ruling in St. It provides that the representation aspect of the CBA is to be for a term of 5 years. the parties shall agree on the duration of the effectivity thereof. on December 28. for instance. 1996). On the other hand.” Under these terms.argues.  Article 253-A serves as the guide in determining when the effectivity of the CBA at bar is to take effect. However. Lukes does not take the “hold over” principle into account. it continues to have legal effects as between the parties until a new CBA has been entered into. an anomaly situation will result when CBA would be more than the 5-year term mandated by Article 253-A of the Labor Code. it is clear that the 5-year term requirement is specific to the representation aspect.
Significantly. it operates and may be executed only respectively unless there are legal justifications for its retroactive application. then. the parties must maintain the status quo and must continue in full force and effect the terms and conditions of the existing agreement until a new agreement is reached. 1996. 1996 and December 28. 1996 and December 28. that in the absence of a new CBA. The parties are directed to execute a Collective Bargaining Agreement incorporating the terms and conditions contained in the unaffected portions of the Secretary of Labor’s order of August 19.e. the petition is granted and the orders of public respondent Secretary of Labor dated August 19. The retirement fund issue is remanded to the Secretary of Labor for reception of evidence and determination of the legal personality of the MERALCO retirement fund. In this manner.not anybody else the discretion to fix the effectivity of the agreement. WHEREFORE. we hold that any provision of law should then apply for the law abhors a vacuum. an arbitrated CBA takes on the nature of any judicial or quasi-judicial award. Consequently. the law prevents the existence of a gap in the relationship between the collective bargaining parties. 1999. and therefore hold that the CBA should be effective for a term of 2 years counted from December 28.. 1996 are set aside to the extent set forth above. we find no sufficient legal ground on the other justification for the retroactive application of the disputed CBA. the law expressly gives the parties .If no agreement is reached within 6 months from the expiry date of the 3 years that follow the CBA execution. i. . SO ORDERED. In this eventuality. Another legal principle that should apply is that in the absence of an agreement between the parties. the law does not specifically cover the situation where 6 months have elapsed but no agreement has been reached with respect to effectivity. 1996 (the date of the Secretary of Labor’s disputed order on the parties’ motion for reconsideration) up to December 27. and the modifications set forth above. One such provision is the principle of hold over.
and Pardo. J. but the deadlock remained unresolved. 000977-90. (Chairman). 02-00813-90.Davide.R. JJ. As the parties failed to reach new agreement. vs. Kapunan. private respondent sought the aid of the National Conciliation and Mediation Board on October 30. which they did. D E C I S I O N MENDOZA. 109383. 1989. This case arose out of a collective bargaining deadlock between petitioner and private respondent Manila Central Line Free Workers Union-National Federation of Labor. 1989. Melo. concur. Jr. June 15. as well as the resolution dated March 11. .: This is a petition for certiorari to set aside the resolution dated October 10. 1991 of the National Labor Relations Commission in NLRC NCR Case No. the parties declared that conciliation efforts before the NCMB had terminated and it was their desire to submit the case for compulsory arbitration... in NLRC NCR Case No. Accordingly. Quinto. denying reconsideration. 1998] MANILA CENTRAL LINE CORPORATION. respondents. private respondent filed a “Petition for Compulsory Arbitration” in the Arbitration Branch for the National Capital Region of the National Labor Relations Commission. they were required to submit their position papers and proposals. Jr. [G. leaving the rest for arbitration. 1990. MANILA CENTRAL LINE FREE WORKERS UNION-NATIONAL FEDERATION OF LABOR and the NATIONAL LABOR RELATIONS COMMISSION. dismissing the appeal of petitioner Manila Central Line Corporation from the order of Labor Arbiter Donato G. On February 9. and in which they indicated portions of their respective proposals to which they agreed. The parties’ collective bargaining agreement had expired on March 15. At the initial hearing before the labor arbiter.J. No.. petitioner. C. 1993 of the NLRC.
. 1993. 1989. this petition with the following assignment of errors: a) The NLRC erred in affirming the Labor Arbiter’s decision – 1. 1990. increasing the commission rate. Petitioner appealed. the expiry date of the old CBA b) There are serious errors in the findings of facts of the Labor Arbiter which were unqualified affirmed by the NLRC and which justify the review by this Honorable SUPREME COURT. 1991. granting P500. The dispositive portion of his decision reads: WHEREFORE. the labor arbiter rendered a decision embodying provisions for a new collective bargaining agreement. the petitioner UNION and the respondent COMPANY are directed to execute and formalize their new five-year collective bargaining agreement (CBA) retroactive to the date of expiry of the 1986-1989 CBA by adopting the provisions in the aforementioned test which incorporated therein in the disposition set forth by this Arbitrator within thirty (30) days from receipt of this Decision SO ORDERED. the NLRC denied petitioner’s motion for reconsideration.00 signing bonus to the complainant-appellee. and 3. On March 11. but its appeal was denied by the NLRC in its questioned resolution of October 10. Hence.On September 28. holding that the effectivity of the renegotiated CBA shall be retroactive to March 15. the salaries and wages of the fixed income employees covered by the CBA. 2. the incentive pay.
The NLRC erred in upholding the jurisdiction of the Labor Arbiter; and
d) The NLRC erred in affirming the finalization of the CBA by the Labor Arbiter in disregard of the provisions agreed upon by the parties.
The petition is without merit. We shall deal with these contentions in the order they are presented, with the exception of the argument concerning the jurisdiction of the Labor Arbiter (par. (c)), which we shall treat first since it raises a threshold question.
First. Despite the fact that it agreed with the union to submit their dispute to the labor arbiter for arbitration, petitioner questions the jurisdiction of the labor arbiter to render the decision in question. Petitioner contends that the policy of the law now is to encourage resort to conciliation and voluntary arbitration as Art 250(e) of the Labor Code provides.
Indeed, the Labor Code formerly provided that if the parties in collective bargaining fail to reach an agreement, the Bureau of Labor Relations should call them to conciliation meetings and, if its efforts were not successful, certify the dispute to a labor arbiter for compulsory arbitrarion. But this was changed by R.A.No. 6715 which took effect on March 21, 1989. Art 250(e) of the Labor Code now provides that if effects of conciliation fail, the Board shall “encourage the parties to submit their case to a voluntary arbitrator.” With specific reference to cases involving deadlocks in collective bargaining, Art. 262 provides:
Jurisdiction over other labor disputes – The Voluntary Arbitrator or panel of Voluntary Arbitrators, upon agreement of the parties, shall also hear and decide all other labor disputes including unfair labor practices and bargaining deadlocks.
This is what the parties did in this case. After the Board failed to resolve the bargaining deadlock between parties, the union filed a petition for compulsory arbitration in the Arbitration Branch of the NLRC. Petitioner joined the petition and the case was submitted for decision. Although the union’s petition was for “compulsory arbitration,” the subsequent agreement of petitioner to submit the matter for arbitration in effect made the arbitration a voluntary one. The essence of
voluntary arbitration, after all is that it is by agreement of the parties, rather than compulsion of law, that a matter is submitted for arbitration. It does not matter that the person chosen as arbitrator is a labor arbiter who, under Art 217 of the Labor Code, is charged with the compulsory arbitration of certain labor cases. There is nothing in the law that prohibits these labor arbiters from also acting as voluntary arbitrators as long as the parties agree to have him hear and decide their dispute.
Moreover, petitioner must be deemed to be estopped from questioning the authority of Labor Arbiter Donato G. Quinto, Jr., to act as voluntary arbitrator and render a decision in this case. Petitioner agreed together with the union, to refer their dispute for arbitration to him. It was only after the decision was rendered that petitioner raised the question of lack of jurisdiction. Even then, petitioner did so only for the first time in a “supplemental memorandum
of appeal” to the NLRC. As the NLRC, through Commissioner Romeo B. Putong held, it was too late in the day for petitioner to do this.
Indeed, it is inconsistent for petitioner to contend, on the other hand, that this case should have been resolved through voluntary arbitration and, on the other, to follow the procedure for compulsory arbitration and, appealing the decision of the labor arbiter to the NLRC and subsequently questioning the latter’s decision in Luzon Development Bank v. Luzon Development Bank Employees Association, this case, considered as a special civil action for certiorari to set aside the decision of a voluntary arbitrator, should have been referred, as a matter of policy, to the Court of Appeals. However, it was not evident in the beginning from a cursory consideration of the pleadings that what actually took place in the labor agency was a proceeding for voluntary arbitration. Accordingly, so as not to delay the disposition of this case, we have thought on balance that this case should be retained and decided on the merits.
Second. In par. (a) (1) and par. (b) of its assignment of errors, petitioner questions factual findings of the labor arbiter and the NLRC. Such findings are generally held to be binding, and even final, so long as they are substantially supported by evidence in the record of the case. This is especially so where, as here, the agency and a subordinate one which heard the case in the first instance are in full agreement as to the facts.
The decisions of both the NLRC and the labor arbiter contain an exhaustive discussion of the issues, belying petitioner’s claim that they did not fully consider the evidence and appreciate what it claims are the “dire economic straits” it is in. This is evident from the following portion of the labor arbiter’s order dated September 28, 1990, which NLRC adopted:
From the foregoing allegations of the parties and as expound (sic), discussed and/or argued by them in their respective position paper, the disagreement, or deadlock, as we say it, focus (sic) and centers on the so called “economic issues” particularly on the provisions on Salaries and Wages.
Petitioner-Union proposed that the commission for drivers, conductors and conductresses shall be 10% and 8%, respectively of their gross collections. In addition, as incentive pay, it proposed that drivers, conductors and conductresses shall be entitled to incentive pay as follows: (a) For a quota of P2,600.00, the incentive should be P40.00; (b) for a quota of P2,875.00, the incentive should be P50.00 and (c) for a quota of P3,155.00 the incentive pay should be P60.00.
Further, petitioner-Union, insofar as the “fixed income employees” are concerned, they proposed that they should be granted a salary/wage increase as follows: (a) effective March 15, 1989 –P12.00; (b) Effective March 15, 1990 – P10.00; and (c) effective March 15, 1991 – P8.00.
Respondent, on the other hand, proposes that the commission for drivers and conductor/tresses shall be 8.5% and 6.5% of their gross collection, respectively. And in addition, these drivers and conductors/tresses shall be entitled to an incentive pay based on the following quota, to wit: (a) for a quota of P3,276.00, the incentive pay is P35.00; (b) for a quota of P3,635.00, it is P45.00; and for a quoa of P3,994.00, it is P55.00. Respondent management has no proposal insofar as grant of increase/s to fixed income employees’ subject of the bargaining unit.
As noted at present under the old CBA, the commission for drivers and conductor/tresses is 8%
in order to make the increase realistic it is opined that it should be rounded off to the nearest full number that is to 9% and 7%.5 respectively. From this. As regards the incentive pay. However.5% and 6. With this disagreement in this difference.5% thus making it 8. Respondent in proposing an increase of .5% to make the rate at 8. it is thought of to be practical and reasonable to meet at the middle of the difference in the rate by dividing the same into two. This was rejected by the union which proposes that the rate of the commission be raised to 10% and 8% respectively.5 and 6. while that which proposed (sic) by the company shows an increase of at least 6% and 8% respectively.75% and 6. The difference between the parties proposal and counter-proposal is at least 19% and 25%. respondent proposes to raise this rate by .and 6%. respectively. respectively. The union debunked the claim fo the respondent-company that it had been financially suffering and had claim (sic) that it had earned profit in all the years that it had been under operation. A look at the parties’ proposal and counter-proposal shows that the union was demanding that the rate be increased to 10% and 8% from the old rate of 8% and 6% or an increase of 2% while that of the company effectively increase the rate by .75%. from 8% and 6%.5%. Hence. During and in the negotiation. or an increase by 2% respectively. respectively.5% justifies the same by saying that such is only what it can afford as it had been incurring financial losses as shown by Financial Statement it submitted in evidence. the increase in the rate should be from the present 8% and 6% to 8. the following appears: . it appears that the disagreement lies on how much would the increase equivalent to at least 25% for the drivers and at least 33% for the conductor/tresses.
P10.00 Another issue where the parties are in statements (sic) is the matter of increase in the salary and wages of the fixed income employees covered by the CBA.00 P2. as shown by its financial statement. while the union lowers (sic) the quota and raises (sic) the rate for the incentive.00 and P8.800.00 3. Hence. to adopt the quota as proposed by the respondent and the rate for the incentive pay as proposed by the union.00 50.635.00 P 35. it is .00 P40. The Union proposes an increase of P12.00 P35. To the mind of this arbitrator.994.00 60.00 3.00 3.00 45.00 As can be gleaned from the above respondent raised the quota but maintained the rate for the incentive pay.00 55. such would be as follows: Quota Rate of Incentive Pay P3. is not really in the verge of financial collapse.00 60.00 3.00 INCENTIVE QUOTA P3.00 P40.276.00 55.00 3. it would seem that they are trying to out-wit each other. he deems it proper and fair for both parties.100.00 2.994. while the company did not submit a proposal for an increase claiming that it cannot afford to give any increase as it had suffered financial difficulty.00 to be spread in the threeyear period. as already discussed earlier where it is found that respondent.635. However.155.00 50.600.400.00.00 3. It is believe (sic) that such is fair and reasonable because as appearing in the parties’ proposal and counter proposal.00 45.600.00 3.OLD CBA PROPOSAL RESPONDENT’S PROPOSAL UNION’S QUOTA INCENTIVE QUOTA INCENTIVE P2.276.
particularly to the union that increase would be mandated. that the labor arbiter has a duty to indicate in his order every relevant proof necessary to show that the opposing party’s evidence is superior to that of petitioner. However. They are given in the form of incentives or encouragement so that employees would be inspired to put a little more industry on their particular tasks.00.00 for the second year and P4.00 for the third year. helped produce.5% but in the same breath. which considerably weakens its assertions The increase in commission rate will not really affect the income of the COMPANY. which they. we could not adopt in toto the proposal of the union. As the Solicitor General states: Nor did respondent NLRC overlook the protestations of the COMPANY that it is suffering from “gargantuan economic trouble. The quantum of proof required in proceedings before administrative agencies is “substantial evidence. This is not so. . P6. Instead. Also. the COMPANY had offered an increase of . This is unlike salaries and wages which are fixed amounts and which should be given to the employees regardless of whether the COMPANY is making any collection or not.” not overwhelming or preponderant evidence. Therefore. The quoted portion of the labor arbiter’s order shows that the proposals of the parties as well as petitioner’s financial statements were carefully considered by him in arriving at his judgment. it claims that it can hardly maintain the commission rate of 8% and 6%. however. it acquired new buses worth P2. however. as can be seen in the 1992 Financial Statement of the COMPANY had just imported machines to recondition their old buses. These facts verify the findings of the Labor Arbiter that the COMPANY is not on the verge of financial collapse…. Moreover.00 for the first year. the employees are merely asking a percentage of the earnings of the COMPANY. was sufficiently refuted by the UNION by presenting proof that the COMPANY had acquired a bus terminal area in Tunasan.Also. By their very nature. Also. that is. P5.” This assertion. commissions will only be given to the employees if the COMPANY receives more income. There is a contradiction of facts right there and then. the COMPANY had just imported machines to recondition their old buses. through their efforts. Petitioner contends.400. as can be seen in the1992 Financial Statement of the COMPANY. we are to adopt the increase as provided under the old CBA.believed that it is reasonable and fair to the parties.000.
262-A of the Labor Code which provides in part: Procedures. Petitioner also contends that in ordering a new CBA to be effective on March 15. the position adopted by the Labor Arbiter . – The voluntary Arbitrator or panel of Voluntary Arbitrators shall have the power to hold hearings. (emphasis added) Third. NLRC. including efforts to effect a voluntary settlement between parties. receive evidence and take whatever action is necessary to resolve the issue or issues subject to dispute. that: . It appears that the COMPANY and the UNION were trying to outwit each other in their respective proposals. the expiry date of the old CBA. particularly taking into consideration the inflation or increase in the cost of living in the subsequent years after the CBA was finalized. The amount is a modest sum. the financial condition of the COMPANY as well as the needs of the employees were taken into consideration. to be given by petitioner only once.increasing the quota and the amount of incentive – is a middle ground which is fair to both parties. This provision states. In ordering payment of this amount. When conclusions of the Labor Arbiter are sufficiently corroborated by the evidence on record. the labor arbiter acted contrary to Art.As regards the incentive pay increase. 1989.00 “signing bonus” to employees unreasonable or arbitrary. Thus. The increase in salaries and wages was premised on the findings of the Labor Arbiter that the COMPANY was not on the verge of financial collapse and that an increase would be mandated. the COMPANY’s financial position was also taken into consideration. Nor is the grant of a P500.. the same should be respected by the appellate tribunals since he is in a better position to assess or evaluate the credibility of the contending parties [CDCP Tollways Operation Employees and Workers Union v. 253-A of the Labor Code. the labor arbiter acted in accordance with Art. in order to make employees finally agree to the new CBA. In adopting the wage increase rates provided in the old CBA. 211 SCRA 58)…. among others.
Therefore. Inc. The CBA in this case. the parties shall agree on the duration of retroactivity thereof. public respondent is deemed vested with plenary and discretionary powers to determine the effectivity thereof. must retroact to the date of the expiration of the previous CBA. we would stress that the provision of law invoked by the Hospital. Article 253-A cannot be properly applied to herein case. the parties may exercise their rights under this Code. 1991 dismissing petitioner’s Motion for Reconsideration – Anent the alleged lack of basis for the retroactivity to provisions awarded. this question was among those submitted for arbitration by the parties: . If any such agreement is entered into beyond six months. and not arbitral awards . petitioner has not shown that the question of effectivity was not included in the general agreement of the parties to submit their dispute for arbitration. Under the circumstances of the case. 818 Rollo). As correctly stated by public respondent in his assailed Order of April 12. shall retroact to the day immediately following such date. is part of an arbitral award. Article 253-A of the Labor Code. on the other hand. it may be made retroactive to the date of expiration of the previous agreement. v. in the absence of a specific provision of law prohibiting retroactivity of the effectivity of arbitral awards issued by the Secretary of Labor pursuant to Article 263(g) of the Labor Code.  Indeed. Torres: Finally. Luke’s Medical Center. As held in St. as to the order of the labor arbiter states. the effectivity of the Order of January 28. . (p. contrary to the position of petitioner. As such. To the contrary. speaks of agreements by and between the parties. Art. In case of a deadlock in the renegotiation of the collective bargaining agreement. . 1991.Any agreement on such other provision of the Collective Bargaining Agreement entered into within six (6) months from the date of the expiry of the term of such other provisions as fixed in such Collective Bargaining Agreement. such as herein involved. 253-A refers to collective bargaining agreements entered into by the parties as a result of their mutual agreement.
No.R. 109383. It is finally contended that the labor arbiter disregarded many provisions of the old CBA which the parties had “retained. the effectivity of the renegotiated CBA. 1998] . this allegation should simply be dismissed. the expiration date of the old CBA.As regards the “Effectivity and Duration” clause. the company proposes that the collective bargaining agreement shall take effect only upon its signing and shall remain in full force and effect for a period of five years. WHEREFORE. improved and agreed upon. Consequently. however. it is believed that the union is fair and reasonable. the petition is DISMISSED for lack of merit. 1989. usually and most often is made effective retroactive to the date when the immediately proceeding CBA expires so as to give a semblance of continuity. for this particular case. Hence. [G. It is the observation of this Arbitrator that in almost subsequent CBAs. SO ORDERED. And after an evaluation of the parties’ respective contention and argument thereof. it is believed that there is nothing wrong adopting the stand of the union. June 15. The union proposes that the agreement shall take effect retroactive to March 15.” Petitioner does not specify. 1989. what provisions of the old CBA were disregarded by the labor arbiter. that is that this CBA be made retroactive effective March 15. Fourth.” with the result that “the CBA finalized by the Honorable Labor Arbiter does not reflect the true intention of the parties.
. The parties’ collective bargaining agreement had expired on March 15. D E C I S I O N MENDOZA. J. and in which they indicated portions of their respective proposals to which they agreed. As the parties failed to reach new agreement. On February 9. which they did. petitioner. the parties declared that conciliation efforts before the NCMB had terminated and it was their desire to submit the case for compulsory arbitration. On September 28. as well as the resolution dated March 11. 1991 of the National Labor Relations Commission in NLRC NCR Case No. they were required to submit their position papers and proposals. in NLRC NCR Case No. MANILA CENTRAL LINE FREE WORKERS UNION-NATIONAL FEDERATION OF LABOR and the NATIONAL LABOR RELATIONS COMMISSION. vs. 1990. 000977-90. dismissing the appeal of petitioner Manila Central Line Corporation from the order of Labor Arbiter Donato G. This case arose out of a collective bargaining deadlock between petitioner and private respondent Manila Central Line Free Workers Union-National Federation of Labor. The dispositive portion of his decision reads: WHEREFORE.MANILA CENTRAL LINE CORPORATION. 02-00813-90. 1989. leaving the rest for arbitration. but the deadlock remained unresolved. At the initial hearing before the labor arbiter.: This is a petition for certiorari to set aside the resolution dated October 10. 1989. Quinto. 1990. the petitioner UNION and the respondent COMPANY are directed to execute and formalize their new five-year collective bargaining agreement (CBA) . private respondent sought the aid of the National Conciliation and Mediation Board on October 30. respondents. private respondent filed a “Petition for Compulsory Arbitration” in the Arbitration Branch for the National Capital Region of the National Labor Relations Commission. 1993 of the NLRC. Accordingly. the labor arbiter rendered a decision embodying provisions for a new collective bargaining agreement. Jr. denying reconsideration.
 Petitioner appealed.retroactive to the date of expiry of the 1986-1989 CBA by adopting the provisions in the aforementioned test which incorporated therein in the disposition set forth by this Arbitrator within thirty (30) days from receipt of this Decision SO ORDERED. c) The NLRC erred in upholding the jurisdiction of the Labor Arbiter. Hence. and 3. the expiry date of the old CBA b) There are serious errors in the findings of facts of the Labor Arbiter which were unqualified affirmed by the NLRC and which justify the review by this Honorable SUPREME COURT. the salaries and wages of the fixed income employees covered by the CBA. 2. but its appeal was denied by the NLRC in its questioned resolution of October 10. . and d) The NLRC erred in affirming the finalization of the CBA by the Labor Arbiter in disregard of the provisions agreed upon by the parties. granting P500. 1989.00 signing bonus to the complainant-appellee. holding that the effectivity of the renegotiated CBA shall be retroactive to March 15. the incentive pay. increasing the commission rate. this petition with the following assignment of errors: a) The NLRC erred in affirming the Labor Arbiter’s decision – 1. 1991. the NLRC denied petitioner’s motion for reconsideration. 1993. On March 11.
First. The essence of voluntary arbitration.A. Petitioner joined the petition and the case was submitted for decision. Despite the fact that it agreed with the union to submit their dispute to the labor arbiter for arbitration. Although the union’s petition was for “compulsory arbitration. This is what the parties did in this case. is charged with the compulsory arbitration of certain labor cases. upon agreement of the parties. But this was changed by R. under Art 217 of the Labor Code. shall also hear and decide all other labor disputes including unfair labor practices and bargaining deadlocks. Indeed. that a matter is submitted for arbitration.No. It does not matter that the person chosen as arbitrator is a labor arbiter who. if its efforts were not successful. petitioner questions the jurisdiction of the labor arbiter to render the decision in question.The petition is without merit.” With specific reference to cases involving deadlocks in collective bargaining. Art. After the Board failed to resolve the bargaining deadlock between parties. the Board shall “encourage the parties to submit their case to a voluntary arbitrator. with the exception of the argument concerning the jurisdiction of the Labor Arbiter (par. There is nothing in the law that prohibits these labor arbiters from also acting as voluntary arbitrators as long as the parties agree to have him hear and decide their dispute. (c)). certify the dispute to a labor arbiter for compulsory arbitrarion. rather than compulsion of law. which we shall treat first since it raises a threshold question. the union filed a petition for compulsory arbitration in the Arbitration Branch of the NLRC. . the Labor Code formerly provided that if the parties in collective bargaining fail to reach an agreement. 1989. after all is that it is by agreement of the parties. 262 provides: Jurisdiction over other labor disputes – The Voluntary Arbitrator or panel of Voluntary Arbitrators. Art 250(e) of the Labor Code now provides that if effects of conciliation fail. 6715 which took effect on March 21. the Bureau of Labor Relations should call them to conciliation meetings and. Petitioner contends that the policy of the law now is to encourage resort to conciliation and voluntary arbitration as Art 250(e) of the Labor Code provides. We shall deal with these contentions in the order they are presented.” the subsequent agreement of petitioner to submit the matter for arbitration in effect made the arbitration a voluntary one.
Quinto. so as not to delay the disposition of this case. as here. considered as a special civil action for certiorari to set aside the decision of a voluntary arbitrator. to act as voluntary arbitrator and render a decision in this case. Putong held. 1990. we have thought on balance that this case should be retained and decided on the merits. Such findings are generally held to be binding. the agency and a subordinate one which heard the case in the first instance are in full agreement as to the facts. through Commissioner Romeo B. to refer their dispute for arbitration to him. However. (a) (1) and par. Second. should have been referred. The decisions of both the NLRC and the labor arbiter contain an exhaustive discussion of the issues.Moreover. Even then. As the NLRC. on the other hand. appealing the decision of the labor arbiter to the NLRC and subsequently questioning the latter’s decision in Luzon Development Bank v. belying petitioner’s claim that they did not fully consider the evidence and appreciate what it claims are the “dire economic straits” it is in. it is inconsistent for petitioner to contend. This is especially so where. Jr. and even final. it was too late in the day for petitioner to do this. (b) of its assignment of errors. this case.. Indeed. to the Court of Appeals. it was not evident in the beginning from a cursory consideration of the pleadings that what actually took place in the labor agency was a proceeding for voluntary arbitration. petitioner must be deemed to be estopped from questioning the authority of Labor Arbiter Donato G. Accordingly. petitioner questions factual findings of the labor arbiter and the NLRC. In par. to follow the procedure for compulsory arbitration and. petitioner did so only for the first time in a “supplemental memorandum of appeal” to the NLRC. as a matter of policy. This is evident from the following portion of the labor arbiter’s order dated September 28. Petitioner agreed together with the union. on the other. It was only after the decision was rendered that petitioner raised the question of lack of jurisdiction. so long as they are substantially supported by evidence in the record of the case. Luzon Development Bank Employees Association. that this case should have been resolved through voluntary arbitration and. which NLRC adopted: .
as we say it.00.00.00.00.5% justifies the same by saying that such is only what it can afford as it had been incurring financial . the incentive pay is P35. on the other hand.00. the incentive should be P40. it is P55. and for a quoa of P3. it is P45. petitioner-Union.5% of their gross collection.00.00. respondent proposes to raise this rate by . In addition.00. As noted at present under the old CBA. 1989 –P12.From the foregoing allegations of the parties and as expound (sic). respectively.5 and 6. (b) Effective March 15.635.00.276. Respondent in proposing an increase of .5% thus making it 8. And in addition. 1990 – P10.875.5% and 6. respectively of their gross collections. the disagreement. Respondent. the commission for drivers and conductor/tresses is 8% and 6%.600. Further.994. or deadlock. Respondent management has no proposal insofar as grant of increase/s to fixed income employees’ subject of the bargaining unit. to wit: (a) for a quota of P3.00. (b) for a quota of P3.00 and (c) for a quota of P3. the incentive should be P50. it proposed that drivers. conductors and conductresses shall be entitled to incentive pay as follows: (a) For a quota of P2. (b) for a quota of P2. During and in the negotiation.155.00. 1991 – P8. as incentive pay.00 the incentive pay should be P60. proposes that the commission for drivers and conductor/tresses shall be 8. Petitioner-Union proposed that the commission for drivers. conductors and conductresses shall be 10% and 8%. focus (sic) and centers on the so called “economic issues” particularly on the provisions on Salaries and Wages.00. they proposed that they should be granted a salary/wage increase as follows: (a) effective March 15. and (c) effective March 15. insofar as the “fixed income employees” are concerned. respectively.5 respectively. these drivers and conductors/tresses shall be entitled to an incentive pay based on the following quota. discussed and/or argued by them in their respective position paper.00.
5% to make the rate at 8.800.00 INCENTIVE QUOTA P3.100. Hence.600.00 P2.5%. or an increase by 2% respectively.00 45.losses as shown by Financial Statement it submitted in evidence. in order to make the increase realistic it is opined that it should be rounded off to the nearest full number that is to 9% and 7%.00 50.00 45.5% and 6. A look at the parties’ proposal and counter-proposal shows that the union was demanding that the rate be increased to 10% and 8% from the old rate of 8% and 6% or an increase of 2% while that of the company effectively increase the rate by .276. the following appears: OLD CBA PROPOSAL RESPONDENT’S PROPOSAL UNION’S QUOTA INCENTIVE QUOTA INCENTIVE P2. it is thought of to be practical and reasonable to meet at the middle of the difference in the rate by dividing the same into two.00 P40.75%. From this. respectively. from 8% and 6%.00 .00 3.00 P 35.75% and 6.635. The difference between the parties proposal and counter-proposal is at least 19% and 25%. As regards the incentive pay. it appears that the disagreement lies on how much would the increase equivalent to at least 25% for the drivers and at least 33% for the conductor/tresses.600.00 P35.00 3. With this disagreement in this difference. However. while that which proposed (sic) by the company shows an increase of at least 6% and 8% respectively. The union debunked the claim fo the respondent-company that it had been financially suffering and had claim (sic) that it had earned profit in all the years that it had been under operation. This was rejected by the union which proposes that the rate of the commission be raised to 10% and 8% respectively. the increase in the rate should be from the present 8% and 6% to 8. respectively.00 2.
such would be as follows: Quota Rate of Incentive Pay P3.00 3.00 60. while the company did not submit a proposal for an increase claiming that it cannot afford to give any increase as it had suffered financial difficulty.276. while the union lowers (sic) the quota and raises (sic) the rate for the incentive.635. as already discussed earlier where it is found that respondent. Hence. .00 Another issue where the parties are in statements (sic) is the matter of increase in the salary and wages of the fixed income employees covered by the CBA.994. P5.00 for the third year.400.00 3.994. P6.00 for the second year and P4. it would seem that they are trying to out-wit each other.00 P40.00 50. Instead.00.00 As can be gleaned from the above respondent raised the quota but maintained the rate for the incentive pay. To the mind of this arbitrator.00 55. However.00 to be spread in the threeyear period. we are to adopt the increase as provided under the old CBA. to adopt the quota as proposed by the respondent and the rate for the incentive pay as proposed by the union.00 for the first year. P10. particularly to the union that increase would be mandated.00 60.00 and P8. he deems it proper and fair for both parties.3. is not really in the verge of financial collapse. It is believe (sic) that such is fair and reasonable because as appearing in the parties’ proposal and counter proposal. we could not adopt in toto the proposal of the union.00 3.00 55.00 3. The Union proposes an increase of P12. as shown by its financial statement. it is believed that it is reasonable and fair to the parties. that is. However.155.
This is not so. the COMPANY had just imported machines to recondition their old buses. the employees are merely asking a percentage of the earnings of the COMPANY. These facts verify the findings of the Labor Arbiter that the COMPANY is not on the verge of financial collapse….000. Also. They are given in the form of incentives or encouragement so that employees would be inspired to put a little more industry on their particular tasks. Moreover. it acquired new buses worth P2. commissions will only be given to the employees if the COMPANY receives more income. however. As regards the incentive pay increase. the COMPANY’s financial position was also taken into consideration. Thus. Also. was sufficiently refuted by the UNION by presenting proof that the COMPANY had acquired a bus terminal area in Tunasan. it claims that it can hardly maintain the commission rate of 8% and 6%. helped produce. as can be seen in the1992 Financial Statement of the COMPANY. which considerably weakens its assertions The increase in commission rate will not really affect the income of the COMPANY. the position adopted by the Labor Arbiter .” not overwhelming or preponderant evidence.00. By their very nature.. There is a contradiction of facts right there and then. Therefore. the COMPANY had offered an increase of . This is unlike salaries and wages which are fixed amounts and which should be given to the employees regardless of whether the COMPANY is making any collection or not. through their efforts.Petitioner contends. which they. however. The quantum of proof required in proceedings before administrative agencies is “substantial evidence.5% but in the same breath.400. It appears that the COMPANY and the UNION were trying to outwit each other in their respective proposals. .” This assertion. that the labor arbiter has a duty to indicate in his order every relevant proof necessary to show that the opposing party’s evidence is superior to that of petitioner.Also. As the Solicitor General states: Nor did respondent NLRC overlook the protestations of the COMPANY that it is suffering from “gargantuan economic trouble. as can be seen in the 1992 Financial Statement of the COMPANY had just imported machines to recondition their old buses. The quoted portion of the labor arbiter’s order shows that the proposals of the parties as well as petitioner’s financial statements were carefully considered by him in arriving at his judgment.increasing the quota and the amount of incentive – is a middle ground which is fair to both parties.
(emphasis added) Third. the financial condition of the COMPANY as well as the needs of the employees were taken into consideration. In ordering payment of this amount. 1989. In adopting the wage increase rates provided in the old CBA. In case of a deadlock in the renegotiation of the collective bargaining agreement. When conclusions of the Labor Arbiter are sufficiently corroborated by the evidence on record. 262-A of the Labor Code which provides in part: Procedures.The increase in salaries and wages was premised on the findings of the Labor Arbiter that the COMPANY was not on the verge of financial collapse and that an increase would be mandated. particularly taking into consideration the inflation or increase in the cost of living in the subsequent years after the CBA was finalized.00 “signing bonus” to employees unreasonable or arbitrary. NLRC. among others. Petitioner also contends that in ordering a new CBA to be effective on March 15. Nor is the grant of a P500. the expiry date of the old CBA. – The voluntary Arbitrator or panel of Voluntary Arbitrators shall have the power to hold hearings. This provision states. the same should be respected by the appellate tribunals since he is in a better position to assess or evaluate the credibility of the contending parties [CDCP Tollways Operation Employees and Workers Union v. including efforts to effect a voluntary settlement between parties. The amount is a modest sum. shall retroact to the day immediately following such date. . the labor arbiter acted contrary to Art. 211 SCRA 58)…. in order to make employees finally agree to the new CBA. If any such agreement is entered into beyond six months. that: Any agreement on such other provision of the Collective Bargaining Agreement entered into within six (6) months from the date of the expiry of the term of such other provisions as fixed in such Collective Bargaining Agreement. the labor arbiter acted in accordance with Art. receive evidence and take whatever action is necessary to resolve the issue or issues subject to dispute. the parties may exercise their rights under this Code. to be given by petitioner only once. 253-A of the Labor Code. the parties shall agree on the duration of retroactivity thereof.
public respondent is deemed vested with plenary and discretionary powers to determine the effectivity thereof. The union proposes that the agreement shall take effect retroactive to March 15. Torres: Finally. Article 253-A cannot be properly applied to herein case. we would stress that the provision of law invoked by the Hospital. 1989. petitioner has not shown that the question of effectivity was not included in the general agreement of the parties to submit their dispute for arbitration. as to the order of the labor arbiter states. such as herein involved. As held in St.  Indeed. speaks of agreements by and between the parties. Therefore. is part of an arbitral award.Art. . Article 253-A of the Labor Code. the effectivity of the Order of January 28. The CBA in this case. As such. the company proposes that the collective bargaining agreement shall take effect only upon its signing and shall remain in full force and effect for a period of five years. 1991. Inc. and not arbitral awards . contrary to the position of petitioner. 1991 dismissing petitioner’s Motion for Reconsideration – Anent the alleged lack of basis for the retroactivity to provisions awarded. must retroact to the date of the expiration of the previous CBA. Under the circumstances of the case. (p. it may be made retroactive to the date of expiration of the previous agreement. the expiration date of the old CBA. on the other hand. v. this question was among those submitted for arbitration by the parties: As regards the “Effectivity and Duration” clause. To the contrary. . As correctly stated by public respondent in his assailed Order of April 12. Luke’s Medical Center. in the absence of a specific provision of law prohibiting retroactivity of the effectivity of arbitral awards issued by the Secretary of Labor pursuant to Article 263(g) of the Labor Code. 818 Rollo). . 253-A refers to collective bargaining agreements entered into by the parties as a result of their mutual agreement.
September 19. respondents. Secretary of Labor. Dept. Consequently. improved and agreed upon. represented by its President RAYMUNDO HIPOLITO. (Formerly. of Labor & Employment. that is that this CBA be made retroactive effective March 15.R. the effectivity of the renegotiated CBA. for this particular case. SAN MIGUEL CORPORATION. it is believed that the union is fair and reasonable. JR. what provisions of the old CBA were disregarded by the labor arbiter. It is finally contended that the labor arbiter disregarded many provisions of the old CBA which the parties had “retained. D E C I S I O N KAPUNAN. Magnolia Plant) and SAN MIGUEL FOODS. MAGNOLIA CORPORATION (Formerly. NIEVES D. MA. SO ORDERED. petitioner. 1989. however. Hence. WHEREFORE.And after an evaluation of the parties’ respective contention and argument thereof.” with the result that “the CBA finalized by the Honorable Labor Arbiter does not reflect the true intention of the parties. 1996] SAN MIGUEL CORPORATION EMPLOYEES UNION-PTGWO. CONFESOR. INC. J. this allegation should simply be dismissed. B-Meg Plant). It is the observation of this Arbitrator that in almost subsequent CBAs.” Petitioner does not specify. usually and most often is made effective retroactive to the date when the immediately proceeding CBA expires so as to give a semblance of continuity. No. it is believed that there is nothing wrong adopting the stand of the union. HON. Fourth.. 111262.: . vs. [G. the petition is DISMISSED for lack of merit.
among others. This CBA provided. petitioner-union San Miguel Corporation Employees Union PTGWO entered into a Collective Bargaining Agreement (CBA) with private respondent San Miguel Corporation (SMC) to take effect upon the expiration of the previous CBA or on June 30. this Agreement shall nevertheless remain in force up to the time a subsequent agreement is reached by the parties. SEC. In accordance with Article 253-A of the Labor Code as amended. 2. 1989. SEC. (2) . 3. Sixty (60) days prior to June 30. This Agreement which shall be binding upon the parties hereto and their respective successors-in-interest. shall become effective and shall remain in force and effect until June 30. shall be for five (5) years from July 1. except insofar as the representation aspect is concerned. 1992 either party may initiate negotiations of all provisions of this Agreement. If no agreement is reached in such negotiations. 1991that the company which was composed of four operating divisions namely: (1) Beer. the freedom period for purposes of such representation shall be sixty (60) days prior to June 30. 1989 to June 30. The facts are as follows: On June 28. 1994. 1993 involving a labor dispute at San Miguel Corporation. In keeping with their vision and long term strategy for business expansion.This is a petition for certiorari assailing the Order of the Secretary of Labor rendered on February 15. 1994. Hence. the term of this Agreement insofar as the representation aspect is concerned. SMC management informed its employees in a letter dated August 13. that: ARTICLE XIV DURATION OF AGREEMENT SECTION 1. 1990. 1992.
Inc. the CBA was renegotiated in accordance with the terms of the CBA and Article 253-A of the Labor Code. Unable to agree on these issues with respect to the bargaining unit and duration of the CBA. contended that the members/employees who had moved to Magnolia and SMFI. 1992 with the two parties submitting their respective proposals and counterproposals. On October 2. Furthermore. SMC. the CBA remained in force and effect. petitioner-union declared a deadlock on September 29. on the other hand. automatically ceased to be part of the bargaining unit at the SMC. Effective October 1. the CBA should be effective for three years in accordance with Art. (SMFI). 1990. (4) Magnolia and Agri-business would undergo a restructuring. 1992. During the negotiations. Notwithstanding the spin-offs. . (3) Feeds and Livestocks. In order to avert a strike. 253-A of the Labor Code. No settlement was arrived at despite several meetings held between the parties. Negotiations started sometime in July. 1992. and that the renegotiated terms of the CBA shall be effective only for the remaining period of two years or until June 30. 1991. the petitioner-union insisted that the bargaining unit of SMC should still include the employees of the spun-off corporations: Magnolia and SMFI. Magnolia and Feeds and Livestock Division were spun-off and became two separate and distinct corporations: Magnolia Corporation (Magnolia) and San Miguel Foods.Packaging. SMC requested the National Conciliation and Mediation Board (NCMB) to conduct preventive mediation. After June 30. 1994. a Notice of Strike was filed against SMC.
 Several conciliation meetings were held but still no agreement/settlement was arrived at by both parties. petitioner-union now comes to this Court questioning this Order of the Secretary of Labor. that the renegotiated terms of the CBA shall be effective for the period of three (3) years from June 30. maintaining that the employees of Magnolia and SMFI fall within the bargaining unit of SMC. Meanwhile. and that such CBA shall cover only the employees of SMC and not of Magnolia and SMFI. the Secretary of Labor assumed jurisdiction over the labor dispute on November 10.On November 3. 1992. a strike vote was conducted which resulted in a “yes vote” in favor of a strike. Subsequently. On March 29. the Court issued a resolution granting the temporary restraining order prayed for. 1993 directing. 1995. an urgent motion for leave to intervenein the case was filed by the Samahan ng Malayang Manggagawa-San Miguel Corporation-Federation of Free . 1992. petitioner-union filed a Motion for Issuance of a Temporary Restraining Order or Writ of Preliminary Injunction to enjoin the holding of the certification elections in the different companies. As prayed for. 1992. On November 4. 1992. 1995. After the parties submitted their respective position papers. on March 30. Magnolia and SMFI filed a petition with the Secretary of Labor praying that the latter assume jurisdiction over the labor dispute in a vital industry. among others. Dissatisfied. the Secretary of Labor issued the assailed Order on February 15. private respondents SMC.
Efren Carreon. he challenged the legal personality of Mr. the Secretary of Labor. However.R. Acting President of the SMCEU-PTGWO. where the Court recognized the separation of the employees of Magnolia from the SMC bargaining unit. Armando. . to represent the Union as its president when the latter was already officially dismissed from the company on October 4. Borbon v. Elmer S. The Intervenor cited the case of Daniel S. Raymundo Hipolito.L. 1994. Petitioner-union contends that the duration for the non-representation provisions of the CBA should be coterminous with the term of the bargaining agency which in effect shall be for the remaining two years of the current CBA. It then prayed for the lifting of the temporary restraining order. No. citing a previous decision of the Secretary of Labor on December 14. March 5. At the same time. Hon. 1993. 101766. in her questioned Order of February 15. 1992 in the matter of the labor dispute at Philippine Refining Company.Workers (SMM-SMC. Laguesma. Likewise. Amidst all these pleadings.FFW) through its authorized representiative. filed a petition for the withdrawal/dismissal of the petition considering that the temporary restraining order jeopardized the employees’ right to conclude a new CBA. alleging that it is one of the contending parties adversely effected by the temporary restraining order. G. 1993 ruled that the renegotiated terms of the CBA at SMC should run for a period of three (3) years. and 2) Whether or not the bargaining unit of SMC includes also the employees of Magnolia and SMFI. Jr. the following primordial issues arise: 1) Whether or not the duration of the renegotiated terms of the CBA is to be effective for three years or for only two years. Bienvenido B.
1989. All other provisions of the Collective Bargaining Agreement shall be renegotiated not later than three (3) years after its execution. shall retroact to the day immediately following such date. 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. the law is clear and definite on the duration of the CBA insofar as the representation aspect is concerned.We agree with the Secretary of Labor. This new provision states that the CBA has a term of five (5) years instead of three years. insofar as the representation aspect is concerned. “All other provisions” simply refers to the rest of the CBA. (underlining supplied. 253-A of the Labor Code as amended which reads: ART. Any agreement on such other provisions of the Collective Bargaining Agreement entered into within six (6) months from the date of expiry of the term of such other provisions as fixed in such Collective Bargaining Agreement. the parties may exercise their rights under this Code. No petition questioning the majority status of the incumbent bargaining agent shall be entertained and no certification election shall be conducted by the Department of Labor and Employment outside of the sixty-day period immediately before the date of expiry of such five year term of the Collective Bargaining Agreement. be for a term of five (5) years. but is quite ambiguous with the terms of the other provisions of the CBA.) Article 253-A is a new provision. This was incorporated by Section 21 of Republic Act No. 253-A. 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 three (3) years after its execution. — Any Collective Bargaining Agreement that the parties may enter into shall. 6715 (the Herrera-Veloso Law) which took effect on March 21. Pertinent to the first issue is Art. Terms of a Collective Bargaining Agreement. In case of a deadlock in the renegotiation of the collective bargaining agreement. The . If any such agreement is entered into beyond six months. It is a cardinal principle of statutory construction that the Court must ascertain the legislative intent for the purpose of giving effect to any statute. economic as well as non-economic provisions. the parties shall agree on the duration of retroactivity thereof. except representation. As the Secretary of Labor herself observed in the instant case.
then.’ xxx xxx xxx . We look into the discussions leading to the passage of the law: THE CHAIRMAN (REP. for us na nagne-negotiate. we are governed by our biases na ito ay destroyer ng Labor. to develop rapport with the management. THE CHAIRMAN (REP. THE CHAIRMAN (SEN. . I think. ang mga employer. HERRERA): You can negotiate for one year. HERRERA): Present practice? THE CHAIRMAN (REP. Actually. . VELASCO): . VELOSO): Yes. VELOSO): In other words. insofar as the economic provisions are concerned . ‘Yan ang nangyayari. ang thrust natin ay industrial peace. . THE CHAIRMAN (REP. but let us give that allowance for one year to let them know. ‘Yan ang problema. THE CHAIRMAN (SEN. HERRERA): Three years. the CBA. and hazard talaga sa negotiation. at least he has one year to administer and to adjust. . . . . ito bayaran ko lang ito okay na. THE CHAIRMAN (SEN. two years or three years but assuming three years which. that’s the likelihood.history of the times and state of the things existing when the act was framed or adopted must be followed and the conditions of the things at the time of the enactment of the law should be considered to determine the legislative intent. HERRERA): Maximum of three years? THE CHAIRMAN (SEN. Yan ang importante. after three years puwede nang magnegotiate in that CBA for the remaining two years. VELOSO): Maximum of three years. when we negotiate with somebody na hindi natin kilala. and there can be no industrial peace if you encourage union to fight each other. You know. assuming there will be a change of agent. the new union.
CHAIRMAN HERRERA: No.HON. HON. . CHAIRMAN HERRERA: One year na lang because six years nang lahat. HON. HON. all the others three years. . tapos na iyong term. ISIDRO: Assuming that they usually follow the period — three years nang three years. CHAIRMAN HERRERA: Five years. after three years. CHAIRMAN HERRERA: Not later than three years. CHAIRMAN HERRERA: Yes. . ang karapatan noon sa representation issue mayroon pang two years left. seven years ang lifetime . but under this law with respect to representation — five years. HON. so within three years you have to make a new CBA. HON. three plus three. ISIDRO: Five years. not later than three years. . insofar as representation issue is concerned. ISIDRO: Not later than three years. ano? Now. Sabi kasi rito. HON. seven years . kasi these two periods that are mentioned in the CBA seem to provide some doubts later on in the implementation. renewed na iyong terms. ISIDRO: Madali iyan. HON. nagkaroon ng bagong terms. ISIDRO: That is again for purposes of renewing the terms. three years na naman iyan — then. . HON. Ang three years duon sa terms and conditions. HON.
. mayroon na naman another five years iyong ano . when the CBA has only a three-year lifetime with respect to the terms and conditions and then. HON. CHAIRMAN HERRERA: On the third year you can start negotiating to change the terms and conditions. eh. then the new union administers the contract for one year to give him time to know his counterpart — the employer. ISIDRO: Yes. HON. HON. HON. ang natitira duon sa representation two years na lang. CHAIRMAN HERRERA: Two years na lang sa representation. ang representation status now can be questioned. Hindi na. CHAIRMAN HERRERA: But on the fifth year. . So. HON. CHAIRMAN HERRERA: Assuming you will follow the practice . CHAIRMAN HERRERA: Hindi. . Three years pa lang ang natatapos. another CBA was formed and this CBA mayroon na naman siyang bagong five years with respect to representation issue. HON. HON. ISIDRO: Oo. two years pa rin ang natitira. so baka puwedeng magkaroon ng certification election. . . If the incumbent union loses. Iyan ang advantage. Ganito iyan. . before he can negotiate for a new term.HON ISIDRO: Hindi. HON. Iyong terms and conditions for three years. HON. HON. ANIAG: So that if they changed the union. HON. . so you have to renew that in three years — you renew for another three years. ISIDRO: Kasi. ISIDRO: Yes. iyong last year. . ANIAG: Hindi.
voluntary arbitration na kayo and then mayroon ka nang probisyon “retroact on the date of the expiry date”. HON. Ganoon and nangyari. ISIDRO: Puro three years. expire ang contract.company union. Ang grabe pang practice diyan. There will be an allowed period of one year. you have only industrial peace for one year. pag-negotiate mo hardline na agad. Hon. administer the contract. Mart.HON. Third year na. for one year. Iyon and nangyari. ano ang usual issue . we will continue to discourage the investors and the union will never grow because every other year it has to use its money for the certification election. let us be realistic. JABAR: Boy. pag-mayroon certification election. I think if a new union wins a certification election. CHAIRMAN HERRERA: Iyon lang. So. Then. CHAIRMAN VELOSO: Mon. I can you (sic) give you more what the incumbent union is giving. Pagnatalo and incumbent unyon. CHAIRMAN HERRERA: Five years. pagpasok mo sa kumpanya. that you have to administer the contract. As far as the term ang condition. Pagkatapos ng negotiation mo. CHAIRMAN HERRERA: That is not true. for four years? HON. HON. That is what we are trying to change. it would not want to administer a CBA which has not been negotiated by the union itself. So ang mangyayari diyan. papasok na ang ibang unyon because the reality in Trade Union committee. actually. HON. they organize. So. mag-aassume and new union. aabot pa minsan ng one year. That is where you have the gulo. duon din mageexpire ang representation. Otherwise. we organize. effective industrial peace. and that will give him time and the employer to know each other. HON. mag-a-advance ang . mag-ne-negotiate ka ng six months. HON. ISIDRO: Ang tingin ko lang dito. ang nangyari diyan. This is true because what is happening now in the country is that the term ng contract natin. iyong distinction between the terms and the representation aspect — why do we have to distinguish between three and five? What’s wrong with having a uniform expiration period? HON. signing kayo. CHAIRMAN HERRERA: That is what we are trying to avoid because ang reality diyan. uumpisahan naman ang organizations. that’s the average.
federation for three years union dues para panggastos lang sa certification election. HON. HON. . CHAIRMAN VELOSO: Only on — HON. CHAIRMAN HERRERA: representation status. HON. CHAIRMAN HERRERA: Not later than 3 years ang karamihan ng mga. . in other words. the legislators were more inclined to have the period of effectivity for three (3) years insofar as the economic as well as noneconomic provisions are concerned. mag. CHAIRMAN HERRERA: — the representations. HON. HON. JABAR: Although there are unions which really get advances. HON. except representation. HON. CHAIRMAN VELOSO: In other words. the better for industrial peace. CHAIRMAN VELOSO: But on the economic issues. the longer the period of the effectivity . CHAIRMAN HERRERA: Pag nag-survey tayo sa mga unyon. That is what we are trying to avoid. CHAIRMAN HERRERA: You have to review that. The parties will have to review that. (continuing) . . HON.negotiate when the company is — (interrupted) xxx From the aforesaid discussions. ganoon ang mangyayari. . CHAIRMAN VELOSO: At least on second year. And I think our responsibility here is to create a legal framework to promote industrial peace and to develop responsible and fair labor movement. CHAIRMAN VELOSO. HON. x x x HON. the longer the period of effectivity of the CBA.
as it provides: SECTION 1. shall be a little bit longer than its lifespan. We quote with favor the Order of the Secretary of Labor in the light of SMC’s peculiar situation as compared with PRC’s company situation. Thus. Labor Dispute at Philippine Refining Company).representation provisions of the CBA. Taking it from the history of their CBAs. we placed premium on the fact that PRC has only two (2) unions and no other union had yet executed a renewed term of 3 years. It can be gleaned from their discussions that it was left to the parties to fix the period. It is equally true that once the economic provisions of the CBA expire. if circumstances warrant that the contract duration which it is soliciting from the company for the benefit of the workers. This Agreement which shall be binding upon the parties hereto and their respective successors-in-interest. The CBA is a contract between the parties and the parties must respect the terms and conditions of the agreement. the framers of the law wanted to maintain industrial peace and stability by having both management and labor work harmoniously together without any disturbance. 1992. the residual representative status of the union is effective for only 2 more years. the framers of the law did not give a fixed term as to the effectivity of the terms and conditions of employment.Obviously. we ruled that the term of the renegotiated provisions of the CBA should coincide with the remaining term of the agency. no outside union can enter the establishment within five (5) years and challenge the status of the incumbent union as the exclusive bargaining agent. SMC intended to have the terms of the CBA effective for three (3) years reckoned from the expiration of the old or previous CBA which was on June 30. shall become effective and shall remain in force and effect until June 30. 1989. we were guided by our considered perception that the said term would improve. the general welfare of both the workers and the company. then this Office cannot stand in the way of a more ideal . Notably. Likewise. rather than ruin. In doing so. in ruling for a shortened term. It is true that in the Philippine Refining Company case (OS-AJ-0031-91 (sic). However. The argument that the PRC case is applicable is indeed misplaced. the terms and conditions of employment (economic and noneconomic) can not be questioned by the employers or employees during the period of effectivity of the CBA. it is not difficult to determine the period of effectivity for the non. In the instant case. Nonetheless.
then all the advantages gained by both parties in this regard. the following CBAs were forged incorporating a term of 3years on the renegotiated provisions.. 1994 which was mentioned in the Resolution . the other unions in these companies eventually concluded their CBA negotiations on the remaining term and all of them agreed on a 3-year cycle. SMF Plant. rather than tranquility. to maintain stability and avoid confusion when the umbilical cord of the two divisions were severed from their parent. In order to effect a smooth transition. Precisely. SMC - daily-paid employees union (IBM) 2. the companies concerned continued to recognize the existing unions as the bargaining agents of their respective bargaining units. this office feels that it will betray its mandate should we order the parties to execute a 2-year renegotiated term for then chaos and confusion. would be the order of the day. there is no dispute that the mother corporation (SMC) spun-off two of its divisions and thereby gave birth to two (2) other entities now known as Magnolia Corporation and San Miguel Foods. i. there is a strong likelihood that such a ruling might spawn discontent and possible mass actions against the company coming from the other unions who had already agreed to a 3-year renegotiated terms. With this in mind.e. If the union would insist on a shorter renegotiated term. These two cannot be considered independently of each other for they were intended to reinforce one another. monthly-paid employees and daily-paid employees at the Cabuyao There is a direct link between the voluntary recognition by the company of the continuing representative status of the unions after the aforementioned spin-offs and the stand of the company for a 3-year renegotiated cycle when the economic provisions of the existing CBAs expired. The issue as to the term of the 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. to wit: 1. the company conceded to face the same union notwithstanding the spin-offs in order to preserve industrial peace during the infancy of the two corporations.situation. In the case at bar. Inc. If this happens. We must not lose sight of the fact that the primordial purpose of a collective contract is to promote industrial harmony and stability in the terms and conditions of employment. would have gone to naught. Worse. In the meantime. To our mind. the purpose of this Office’s intervention into the parties’ controversy would have been defeated. Notably. this objective cannot be achieved without giving due consideration to the peculiarities and unique characteristics of the employer.
In the event however. Thus. likewise. there is. we announced the decentralization program and spoke of the need for structures that can react fast to competition. Magnolia and SMFI were spun-off to operate as distinct companies on October 1. enter into a renegotiated contract with a term of three (3) years or one which does not coincide with the said 5-year term. 1991: x x x As early as 1986. 1991. shorter product life cycles and shifts in consumer preference. the subject contract is valid and legal and therefore. Management saw the need for these transformations in keeping with its vision and long term strategy as it explained in its letter addressed to the employees dated August 13. binds the contracting parties. and said agreement is ratified by majority of the members in the bargaining unit. that the parties. a changing environment. we do not find any grave abuse of discretion on the part of the Secretary of Labor in ruling that the effectivity of the renegotiated terms of the CBA shall be for three (3) years. We further stated . The same will however not adversely affect the right of another union to challenge the majority status of the incumbent bargaining agent within sixty (60) days before the lapse of the original five (5) year term of the CBA. With respect to the second issue. to wit: As a matter of policy the parties are encourages (sic) to enter into a renegotiated CBA with a term which would coincidde (sic) with the aforesaid five (5) year term of the bargaining representative. 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.of Undersecretary Bienvenido Laguesma on January 16. no merit in petitioner-union’s assertion that the employees of Magnolia and SMFI should still be considered part of the bargaining unit of SMC. by mutual agreement. In said memorandum. 1995 in the certification election case involving the SMC employees.
to see the benefits that arise from restructuring a division of San Miguel into a more competitive organization. Ever mindful of the employees’ interests. As a stand-alone enterprise.in the 1987 Annual Report to Stockholders that San Miguel’s businesses will be more autonomous and self sufficient so as to better acquire and master new technologies. Undeniably. cope with a labor force with different expertises and expectations.consumers. more responsive decision making. 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. As subsidiaries. greater awareness of operating results. Neither can we impute any bad faith on the part of SMC so as to justify the application of the doctrine of piercing the corporate veil. xxx We only have to look at the experience of Coca-Cola Bottlers Philippines. Inc. Magnolia and FLD will gain better industry focus and flexibility.. the transformation of the companies was a management prerogative and business judgment which the courts can not look into unless it is contrary to law. We are confident that history will repeat itself. Each of the companies are run by. public policy or morals. new agreements will be negotiated between the management of the new corporations and the bargaining representatives of the employees concerned. supervised and controlled by different management teams including separate human resource/personnel managers. and speedier. As a result of the spin-offs: 1. They were advised that upon the expiration of the CBAs. and the transformation of Magnolia and FLD will be successful as that of CCBPI. CCBPI engineered a dramatic turnaround and has sustained its sales and market share leadership ever since. . since this company was organized about ten years ago. and master and satisfy the changing needs of our customers and end.
who are now attached to Georgia Pacific International Corporation. no more valid ground. Hence. Interests of employees in the different companies perforce differ. is not a justification for disregarding their separate personalities. Magnolia is involved in the manufacturing and processing of dairy products while SMFI is involved in the production of feeds and the processing of chicken. Each entity maintains separate financial statements and are audited separately from each other. therefore. 3. should not be allowed to vote in the certification election at the Lianga Bay Logging Co. 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.. therefore. hours of work and other conditions of employment. Each Company enforces its own administrative and operational rules and policies and are not dependent on each other in their operations. The nature of their products and scales of business . the test of grouping is mutuality or commonality of interests. the companies would consequently have their respective and distinctive concerns in terms of the nature of work. the 236 employees. Inc. Indubitably. wages. We elucidate: The fact that their businesses are related and that the 236 employees of Georgia Pacific International Corporation were originally employees of Lianga Bay Logging Co.. Magnolia and SMFI became distinct entities with separate juridical personalities. they can not belong to a single bargaining unit as held in the case of Diatagon Labor Federation Local 110 of the ULGWP v.2. Considering the spinoffs. 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. in determining an appropriate bargaining unit. Inc. Thus. Ople. They should vote at a separate certification election to determine the collective bargaining representative of the employees of Georgia Pacific International Corporation. SMC is engaged in the business of beer manufacturing. Moreover.
The weight accorded to any particular factor varies in accordance with the particular question or questions that may arise in a given case. management. Ferrer. We reiterate what we have explained in the case of University of the Philippines v. For such reason. work. the history. and working conditions of the employees. and (4) employment status. or other employers in the same industry. the desires of the employees. extent and type of organization of employees in other plants of the same employer.may require different skills which must necessarily be commensurated by different compensation packages. such as substantial similarity of work and duties. xxx An enlightening appraisal of the problem of defining an appropriate bargaining unit is given in the 10th Annual Report of the National Labor Relations Board wherein it is emphasized that the factors which said board may consider and weigh in fixing appropriate units are: the history. but the most pertinent to our case are: (1) will of the employees (Globe Doctrine). such as temporary. What are these factors? Rothenberg mentions a good number. The different companies may have different volumes of work and different working conditions. or similarity of compensation and working conditions. the history of their collective bargaining. the employees of the different companies see the need to group themselves together and organize themselves into distinctive and different groups. the eligibility of the employees for membership in the union or unions involved. extent and type of organization of employees.Calleja that: [T]here are various factors which must be satisfied and considered in determining the proper constituency of a bargaining unit. the skill wages. No one particular factor is itself decisive of the determination. and the relationship between the unit or units proposed and the employer’s organization. seasonal and probationary employees x x. . and operation x x. 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. (2) affinity and unit of employees’ interest. (3) prior collective bargaining history.
Francisco. nonetheless. SO ORDERED. we take note of the fact that the separate interests of the employees of Magnolia and SMFI from those of SMC has been recognized in the case of Daniel Borbon v. January 23. WHEREFORE. hours. working conditions and other subjects of collective bargaining (citing Smith on Labor Laws. 319.R. Rollo). This development. must affect a grouping of employees who have substantial. mutual interests in wages. to be appropriate. In view of all the foregoing. Laguesma. it is likewise emphasized that the basic test in determining the appropriate bargaining unit is that a unit. which was brought to our attention by private respondents. Finally. Rollo). Labor Laws. 305. we do not find any grave abuse of discretion on the part of the Secretary of Labor in rendering the assailed Order. The Temporary Restraining Order issued on March 29. these workers are no longer connected with San Miguel Corporation in any manner because Magnolia has ceased to be a division of San Miguel Corporation and has been formed into a separate corporation with a personality of its own (p. 162) x x. [G. 316-317. 135547.x x In said report. necessarily renders moot and academic any further discourse on the propriety of the elections which petitioners impugn via the present recourse (p. the petition is DISMISSED for lack of merit. 2002] . No. 1995 is lifted.We quote: Even assuming in gratia argumenti that at the time of the election they were regular employees of San Miguel.
The strike ended four days later. BAUTISTA. The factual antecedents of this case are as follows: On June 5. RIVERA.: In this special civil action for certiorari and prohibition. Faced with bankruptcy. PAL pilots affiliated with the Airline Pilots Association of the Philippines (ALPAP) went on a three-week strike. ARANAS. vs. BARRIENTOS. between Philippine Airlines (PAL) and its union.respondents.899 union members. . 16. petitioners. BIENVENIDO LAGUESMA in his capacity as Secretary of Labor and Employment. and ISAGANI ALDEA. 1998. causing serious losses to the financially beleaguered flag carrier. HON. JAIME J. OCAMPO. AQUINO. the PAL Employees Association (PALEA). DELA ROSA. JR.GERARDO F. 1998. ANTONIO V. As a result. petitioners charge public respondents with grave abuse of discretion amounting to lack or excess of jurisdiction for acts taken in regard to the enforcement of the agreement dated September 27. and ALEXANDER O. which affected 1. EDGARDO ESPIRITU in his capacity as Chairman of the PAL Inter-Agency Task Force created under Administrative Order No. PHILIPPINE AIRLINES (PAL). JORGE P. HENRY SO UY. D E C I S I O N QUISUMBING. when PAL and PALEA agreed to a more systematic reduction in PAL’s work force and the payment of separation benefits to all retrenched employees.. MANOLO E. DAVID SORIMA. PAL adopted a rehabilitation plan and downsized its labor force by more than one-third. PAL’s financial situation went from bad to worse. LUCIO TAN. J. 1998. RAMISO. HON. ALFRED A. AMBROCIO PALAD. PALEA went on strike to protest the retrenchment measures adopted by the airline. On July 22. DENNIS R.
Labor and Employment. Lucio Tan’s holdings. the Board of Directors of PALEA voted to accept Tan’s offer and requested the Task Force’s assistance in implementing the same. then President Joseph E.00/share will be transferred in favor of each employee of Philippine Airlines in the active payroll as of September 15. The Task Force was composed of the Departments of Finance.000 fully paid shares of stock of Philippine Airlines with a par value of PHP5. 1998. 1998. was designated chairman of the Task Force. Public respondent Edgardo Espiritu. 1998. of a plan to transfer shares of stock to its employees. Foreign Affairs. We. rejected Tan’s offer. mediation (for) the purpose of arriving at a total and complete solution of the problem. Estrada issued Administrative Order No. The aggregate shares of stock transferred to PAL employees will allow them three (3) members to (sic) the PAL Board of Directors. . On September 10. Should any share-owning employee leave PAL. Chairman and Chief Executive Officer of PAL. From the issued shares of stock within the group of Mr. then the Secretary of Finance. he/she has the option to keep the shares or sells (sic) his/her shares to his/her union or other employees currently employed by PAL. thus. however. the ownership of 60. The pertinent portion of said plan reads: 1. It was “empowered to summon all parties concerned for conciliation. 2. 1998. become partners in the boardroom and together. Transportation and Communication. we would request for a suspension of the Collective Bargaining Agreements (CBAs) for 10 years. the union’s directors subsequently resolved to reject Tan’s offer. we shall address and find solutions to the wide range of problems besetting PAL. Union members. together with the Securities and Exchange Commission (SEC). In order for PAL to attain (a) degree of normalcy while we are tackling its problems. Under intense pressure from PALEA members.On August 28. 16 creating an Inter-Agency Task Force (Task Force) to address the problems of the ailing flag carrier. On September 4. PAL management submitted to the Task Force an offer by private respondent Lucio Tan.” Conciliation meetings were then held between PAL management and the three unions representing the airline’s employees. 3. and Tourism. with the Task Force as mediator.
rehabilitation was no longer feasible. On September 23. and hence. 1998. however.offer.055 voted in favor of Tan’s offer while 1. 1998. seeking his intervention. rejected this counter. 2. and FASAP. 1998. 1998. to prevent the imminent closure of PAL. ALPAP. PAL informed the Task Force that it was shutting down its operations effective September 23. The airline claimed that given its labor problems. On September 27.799 out of 6. PALEA informed the Department of Labor and Employment (DOLE) that it had no objection to a referendum on the Tan’s offer. PALEA sought the intervention of the Office of the President in immediately convening the parties. Tan. PALEA. the PALEA board wrote President Estrada anew. the airline had no alternative but to close shop.000 shares of stock with a par value of P5. Lucio Tan’s shareholdings. including the SEC under the direction of the Inter-Agency Task Force. subject to ratification by the general membership: 1. Of the votes cast. 1. 1998.00. PALEA offered a 10-year moratorium on strikes and similar actions and a waiver of some of the economic benefits in the existing CBA. the PALEA board again wrote the President proposing the following terms and conditions. the PAL management.On September 17. 1998. with three (3) seats in the PAL Board and an additional seat from government shares as indicated by His Excellency. Each PAL employee shall be granted 60. Two days later. PAL ceased its operations and sent notices of termination to its employees. from Mr. preparatory to liquidating its assets and paying off its creditors. On September 19. On September 18. .738 PALEA members cast their votes in the referendum under DOLE supervision held on September 21-22.371 rejected it. 1998.
6. Likewise. as far as practicable. The ‘union shop/maintenance of membership’ provision under the PAL-PALEA CBA shall be respected. PALEA shall. In the absence of applicable Company rule or regulation. be granted adequate representation in committees or bodies which deal with matters affecting terms and conditions of employment. the existing LaborManagement Coordinating Council shall be reorganized and revitalized. b. PALEA agrees. To enhance and strengthen labor-management relations. c.2. PAL . with full medical benefits. 7. and Aranas. Ramiso. provided the following safeguards are in place: a. PAL shall grant the benefits under the 26 July 1998 Memorandum of Agreement forged by and between PAL and PALEA. to those employees who may opt to retire or be separated from the company. the provisions of the Labor Code shall apply. PALEA members who have been retrenched but have not received separation benefits shall be granted priority in the hiring/rehiring of employees. Among the signatories to the letter were herein petitioners Rivera. 4. No salary deduction. with adequate representation from both PAL management and PALEA. subject to the ratification by the general membership. To assure investors and creditors of industrial peace. as officers and/or members of the PALEA Board of Directors. 3. PAL shall continue recognizing PALEA as the duly certified bargaining agent of the regular rank-and-file ground employees of the Company. (to) the suspension of the PAL-PALEA CBA for a period of ten (10) years. 5.
61% were in favor of accepting the PALPALEA agreement. . Of the votes cast. The issues now for our resolution are: (1) Is an original action for certiorari and prohibition the proper remedy to annul the PAL-PALEA agreement of September 27. 1998. On the same date. MAY NOT BE WAIVED. On October 2. seven officers and members of PALEA filed this instant petition to annul the September 27. 1998 agreement entered into between PAL and PALEA on the following grounds: I PUBLIC RESPONDENTS GRAVELY ABUSED THEIR DISCRETION AND EXCEEDED THEIR JURISDICTION IN ACTIVELY PURSUING THE CONCLUSION OF THE PAL-PALEA AGREEMENT AS THE CONSTITUTIONAL RIGHTS TO SELF-ORGANIZATION AND COLLECTIVE BARGAINING.324 PALEA members cast their votes in a DOLEsupervised referendum. 1998. while 34% rejected it. On October 7.management accepted the PALEA proposal and the necessary referendum was scheduled. NOR THE WAIVER. II PUBLIC RESPONDENTS GRAVELY ABUSED THEIR DISCRETION AND EXCEEDED THEIR JURISDICTION IN PRESIDING OVER THE CONCLUSION OF THE PAL-PALEA AGREEMENT UNDER THREAT OF ABUSIVE EXERCISE OF PAL’S MANAGEMENT PREROGATIVE TO CLOSE BUSINESS USED AS SUBTERFUGE FOR UNION-BUSTING. BEING FOUNDED ON PUBLIC POLICY. 1998. RATIFIED. PAL resumed domestic operations. 5.
O. what exists is a contract between a private firm and one of its labor unions. Furthermore. whether exercising judicial. or resolution of either public respondents involved.” and (2) there is no plain. consistent with the mandate of A. respondents pray for the dismissal of the petition for violating the “hierarchy of courts” doctrine enunciated in People v. and adequate remedy in the ordinary course of law. board. Respondents. While the petition is denominated as one for certiorari and prohibition. or with grave abuse of discretion amounting to lack or excess of jurisdiction. or ministerial functions. or person exercising judicial. argue that the public respondents merely served as conciliators or mediators. No. 16 and merely supervised the conduct of theOctober 3. officer. in turn. or officer has acted without or in excess of jurisdiction. 1998. . order. quasi-judicial. Cuaresma and Enrile v. Salazar. there is available to petitioners a plain. officer. It is not the act of public respondents Finance Secretary Edgardo Espiritu and Labor Secretary Bienvenido Laguesma as functionaries of the Task Force. Petitioners allege grave abuse of discretion under Rule 65 of the 1997 Rules of Civil Procedure. its object is actually the nullification of the PAL-PALEA agreement. For writs of prohibition. and adequate remedy in the ordinary course of law.”  The assailed agreement is clearly not the act of a tribunal. board. Thus. (2) such tribunal. corporation.(2) Is the PAL-PALEA agreement of September 27. public respondents did not perform any judicial and quasi-judicial act pertaining to jurisdiction. stipulating the suspension of the PAL-PALEA CBA unconstitutional and contrary to public policy? Anent the first issue. or person. the requisites are: (1) the impugned act must be that of a “tribunal. a board. albeit entered into with the assistance of the Task Force. speedy. Neither is there a judgment. quasi-judicial or ministerial functions. or an officer exercising judicial or quasi-judicial functions. petitioners aver that public respondents as functionaries of the Task Force. speedy. Instead. board. and (3) there is no appeal or any plain. Furthermore. 1998 referendum during which the PALEA members ratified the agreement. and adequate remedy in the ordinary course of law. The first and second requisites for certiorari and prohibition are therefore not present in this case. The essential requisites for a petition for certiorari under Rule 65 are: (1) the writ is directed against a tribunal. gravely abused their discretion and exceeded their jurisdiction when they actively pursued and presided over the PAL-PALEA agreement. speedy.
It violates the “protection to labor” policy laid down by the Constitution. a national concern. 2000.As such. insofar as the representation aspect is concerned. If any such agreement is entered into beyond six months. petitioners contend that the controverted PAL-PALEA agreement is void because it abrogated the right of workers to self-organization and their right to collective bargaining. They allegedly pressured the PALEA leaders into accepting the agreement. Any agreement on such other provisions of the Collective Bargaining Agreement entered into within six (6) months from the date of expiry of the term of such other provisions as fixed in such Collective Bargaining Agreement. No petition questioning the majority status of the incumbent bargaining agent shall be entertained and no certification election shall be conducted by the Department of Labor and Employment outside of the sixty-day period immediately before the date of expiry of such five-year term of the Collective Bargaining Agreement. be for a term of five (5) years. Neither certiorari nor prohibition is the remedy in the present case. considering the prayer of the parties principally we shall look into the substance of the petition. the parties shall . – Any Collective Bargaining Agreement that the parties may enter into shall. Petitioners ask this Court to examine the circumstances that led to the signing of said agreement. petitioners’ proper remedy is an ordinary civil action for annulment of contract. an action which properly falls under the jurisdiction of the regional trial courts. Nevertheless. in the higher interest of justice and in view of the public interest involved. Article 253-A of the Labor Code reads: ART. but also to foreclose any renegotiation or any possibility to forge a new CBA for a decade or up to 2008. shall retroact to the day immediately following such date. Petitioners further assert that public respondents were partial towards PAL management. Terms of a Collective Bargaining Agreement. inasmuch as what is at stake here is industrial peace in the nation’s premier airline and flag carrier. Petitioners claim that the agreement was not meant merely to suspend the existing PAL-PALEA CBA. All other provisions of the Collective Bargaining Agreement shall be renegotiated not later than three (3) years after its execution. This would involve review of the facts and factual issues raised in a special civil action for certiorari which is not the function of this Court. 253-A. On the second issue. which expires on September 30.
but preventing the latter’s closure. Under this provision. By agreeing to a 10-year suspension. abdicated the workers’ constitutional right to bargain for another CBA at the mandated time. with the peculiar and unique intention of not merely promoting industrial peace at PAL. in effect. In case of a deadlock in the renegotiation of the collective bargaining agreement. . may be negotiated not later than three years after the execution.” The primary purpose of a CBA is the stabilization of labor-management relations in order to create a climate of a sound and stable industrial peace. One is to promote industrial stability and predictability. insofar as representation is concerned. except for representation. Article 253-A has a two-fold purpose. Nothing in Article 253-A.agree on the duration of the retroactivity thereof. Inasmuch as the agreement sought to promote industrial peace at PAL during its rehabilitation. In construing a CBA. said agreement satisfies the first purpose of Article 253-A. We find no conflict between said agreement and Article 253-A of the Labor Code. hours of work and all other terms and conditions of employment. the parties may exercise their rights under this Code. PALEA. prohibits the parties from waiving or suspending the mandatory timetables and agreeing on the remedies to enforce the same. The assailed PAL-PALEA agreement was the result of voluntary collective bargaining negotiations undertaken in the light of the severe financial situation faced by the employer. way beyond the maximum statutory life of a CBA. The other is to assign specific timetables wherein negotiations become a matter of right and requirement. including proposals for adjusting any grievances or questions arising under such agreement. the courts must be practical and realistic and give due consideration to the context in which it is negotiated and the purpose which it is intended to serve. Petitioners submit that a 10-year CBA suspension is inordinately long. A CBA is “a contract executed upon request of either the employer or the exclusive bargaining representative incorporating the agreement reached after negotiations with respect to wages. provided for in Article 253-A. a CBA has a term of five years. We find the argument devoid of merit. while the other provisions.
 The aforesaid provision must be read within the context of the next clause. as the exclusive bargaining agent of PAL’s ground employees. in violation of Article 253-A of the Labor Code mandating that an exclusive bargaining agent serves for five years only. PAL shall continue recognizing PALEA as the duly certified-bargaining agent of the regular rank-and-file ground employees of the Company. The right to free collective bargaining. The ‘union shop/maintenance of membership’ provision under the PAL-PALEA CBA shall be respected. The acts of public respondents in sanctioning the 10-year suspension of the PALPALEA CBA did not contravene the “protection to labor” policy of the Constitution. which provides: b. but clauses must be interpreted in relation to one another to give effect to the whole. Either case was the union’s exercise of its right to collective bargaining.In the instant case.contracts cannot be construed by parts. The legal effect of a contract is not determined alone by any particular provision disconnected from all others. including conciliation to foster industrial peace. a construction must be adopted as will give effect to all. after all. The questioned proviso of the agreement reads: a. but from the whole read together. In construing an instrument with several provisions. that voluntarily entered into the CBA with PAL. includes the right to suspend it. . promoted the shared responsibility between workers and employers. Under Article 1374 of the Civil Code. It was also PALEA that voluntarily opted for the 10-year suspension of the CBA. it was PALEA. The agreement afforded full protection to labor. amounting to unfair labor practice." Petitioners further allege that the 10-year suspension of the CBA under the PALPALEA agreement virtually installed PALEA as a company union for said period. Said proviso cannot be construed alone. and the exercised voluntary modes in settling disputes.
 the contract must be upheld. assist or otherwise interfere with the formation or administration of any labor organization. SO ORDERED. WHEREFORE. Jr.” The case records are bare of any showing of such acts by PAL.The aforesaid provisions. the instant petition is DISMISSED. a company union exists when the employer acts “[t]o initiate. and De Leon. the parties agreed to suspend the CBA and put in abeyance the limit on the representation period. Petitioners’ contention that the agreement installs PALEA as a virtual company union is also untenable. 96490 February 3. Under Article 248 (d) of the Labor Code. G. Bellosillo. Under said article. Buena. taken together. No. the representation limit for the exclusive bargaining agent applies only when there is an extant CBA in full force and effect. including the giving of financial or other support to it or its organizers or supporters. Its objective is to assure the continued existence of PALEA during the said period. In sum. In the instant case. clearly show the intent of the parties to maintain “union security” during the period of the suspension of the CBA. 1992 . 1998. For this reason. (Chairman). dominate. It is State policy to promote unionism to enable workers to negotiate with management on an even playing field and with more persuasiveness than if they were to individually and separately bargain with the employer.R. JJ... We also do not agree that the agreement violates the five-year representation limit mandated by Article 253-A. we are of the view that the PAL-PALEA agreement dated September 27. there being no grave abuse of discretion shown. concur. is a valid exercise of the freedom to contract. No pronouncement as to costs. the law has allowed stipulations for “union shop” and “closed shop” as means of encouraging workers to join and support the union of their choice in the protection of their rights and interests vis-à-vis the employer. Mendoza. We are unable to declare the objective of union security an unfair labor practice. Under the principle of inviolability of contracts guaranteed by the Constitution.
sale and . CALICA and INDOPHIL TEXTILE MILLS. Inc. Borreta. 1990 finding that Section 1 (c). Inc.: This is a petition for certiorari seeking the nullification of the award issued by the respondent Voluntary Arbitrator Teodorico P. Calica dated December 8. INC. The antecedent facts are as follows: Petitioner Indophil Textile Mill Workers Union-PTGWO is a legitimate labor organization duly registered with the Department of Labor and Employment and the exclusive bargaining agent of all the rank-and-file employees of Indophil Textile Mills. Article I of the Collective Bargaining Agreement between Indophil Textile Mills. respondents. VOLUNTARY ARBITRATOR TEODORICO P. TEXTILE MILL WORKERS UNION-PTGWO. MEDIALDEA.INDOPHIL petitioner. Gutierrez & Leogardo for respondent Indophil Textile Mills. Incorporated. Calica is impleaded in his official capacity as the Voluntary Arbitrator of the National Conciliation and Mediation Board of the Department of Labor and Employment. Inc. Incorporated. Romeo C. Respondent Teodorico P. vs. J.. and Indophil Textile Mill Workers Union-PTGWO does not extend to the employees of Indophil Acrylic Manufacturing Corporation as an extension or expansion of Indophil Textile Mills. while private respondent Indophil Textile Mills. is a corporation engaged in the manufacture. Lagman for petitioner.
export of yarns of various counts and kinds and of materials of kindred character and has its plants at Barrio Lambakin. Acrylic became operational and hired workers according to its own criteria and standards. In 1990 or a year after the workers of Acrylic have been unionized and a CBA executed.. In April. The application was approved on a preferred nonpioneer status. 1990. to wit.4) In other words. petitioner Indophil Textile Mill Workers Union-PTGWO and private respondent Indophil Textile Mills. the workers of Acrylic unionized and a duly certified collective bargaining agreement was executed. Bulacan. (Rollo. In 1988. Marilao. 1987 to March 31. . 1989. Sometime in July. Acrylic applied for registration with the Board of Investments for incentives under the 1987 Omnibus Investments Code. c) This Agreement shall apply to the Company's plant facilities and installations and to any extension and expansion thereat. Article I of the CBA. The petitioner's contention was opposed by private respondent which submits that it is a juridical entity separate and distinct from Acrylic. p. the petitioner union claimed that the plant facilities built and set up by Acrylic should be considered as an extension or expansion of the facilities of private respondent Company pursuant to Section 1(c). it is the petitioner's contention that Acrylic is part of the Indophil bargaining unit. Inc. On November 3. 1967 Indophil Acrylic Manufacturing Corporation was formed and registered with the Securities and Exchange Commission. 1987. Subsequently. executed a collective bargaining agreement effective from April 1.
the dispositive portion of which provides as follows: PREMISES CONSIDERED. an award is made to the effect that the proper interpretation and application of Sec. (Rollo.The existing impasse led the petitioner and private respondent to enter into a submission agreement on September 6. WHETHER OR NOT INDOPHIL ACRYLIC IS A SEPARATE AND DISTINCT ENTITY FROM RESPONDENT COMPANY FOR PURPOSES OF UNION REPRESENTATION. WHETHER OR NOT THE RESPONDENT ARBITRATOR GRAVELY ABUSED HIS DISCRETION AMOUNTING TO LACK OR IN EXCESS OF HIS JURISDICTION. l. of the 1987 CBA do (sic) not extend to the employees of Acrylic as an extension or expansion of Indophil Textile Mills. 4. Inc. to wit: 1. After the parties submitted their respective position papers and replies. Art. The parties jointly requested the public respondent to act as voluntary arbitrator in the resolution of the pending labor dispute pertaining to the proper interpretation of the CBA provision. this petition raising four (4) issues. ART I OF THE CBA BETWEEN PETITIONER UNION AND RESPONDENT COMPANY.21) Hence. 3. 1990. pp. I. WHETHER OR NOT THE RESPONDENT ARBITRATOR ERRED IN INTERPRETING SECTION 1(c). (Rollo. Wherefore. the public respondent Voluntary Arbitrator rendered its award on December 8. WHETHER OR NOT THE RESPONDENT ARBITRATOR VIOLATED PETITIONER UNION'S CARDINAL PRIMARY RIGHT TO DUE PROCESS. 1990. (c). p. it would be a strained interpretation and application of the questioned CBA provision if we would extend to the employees of Acrylic the coverage clause of Indophil Textile Mills CBA. 6-7) The central issue submitted for arbitration is whether or not the operations in Indophil Acrylic Corporation are an extension or expansion of private respondent . 2.
Indophil Acrylic cannot manufacture textiles while private respondent cannot buy or import yarns. Ople. independent and separate from other corporations (see Rollo. L-44493-94.970. G. of the total stock subscription of Indophil Acrylic. which is the manufacture and sale of yarns of various counts and kinds and of other materials of kindred character or nature. export and otherwise deal in yarns of various counts and kinds. Article I of the CBA in its literal meaning without taking cognizance of the facts adduced that the creation of the aforesaid Indophil Acrylic is but a devise of respondent Company to evade the application of the CBA between petitioner Union and respondent Company. Hence. Furthermore. barter. sell at wholesale basis.R. Petitioner maintains that public respondent Arbitrator gravely erred in interpreting Section l(c). December 3. No. unlike private respondent. 10l SCRA 534. . and/or within the scope of the bargaining unit. private respondent cited the case of Diatagon Labor Federation v. pp. 160-161). P1. the Solicitor General alleges that the primary purpose of private respondent is to engage in the business of manufacturing yarns of various counts and kinds and textiles. Contrary to petitioner's assertion. import. On this point. Corollary to the aforementioned issue is the question of whether or not the rank-and-file employees working at Indophil Acrylic should be recognized as part of. which ruled that two corporations cannot be treated as a single bargaining unit even if their businesses are related.Company. Petitioner stresses that the articles of incorporation of the two corporations establish that the two entities are engaged in the same kind of business. petitioner emphasizes that the two corporations have practically the same incorporators. In addition.000.00 which represents seventy percent (70%) of the total subscription of P2. the primary purpose of Indophil Acrylic is to manufacture.00 was subscribed to by respondent Company.500. On the other hand. It submits that the fact that there are as many bargaining units as there are companies in a conglomeration of companies is a positive proof that a corporation is endowed with a legal personality distinctly its own. 1980. buy.749. In fact. directors and officers. the public respondent through the Solicitor General argues that the Indophil Acrylic Manufacturing Corporation is not an alter ego or an adjunct or business conduit of private respondent because it has a separate legitimate business purpose.
but this is not a hard and fast rule. Bulacan. at Barrio Lambakin.Petitioner notes that the foregoing evidence sufficiently establish that Acrylic is but an extension or expansion of private respondent. It also pointed out that the essential services are discharged exclusively by Acrylic personnel under the control and supervision of Acrylic managers and supervisors. We stress that the decisions of voluntary arbitrators are to be given the highest respect and a certain measure of finality. such as dyeing machines. grave . petitioner insists that the public respondent committed grave abuse of discretion amounting to lack or in excess of jurisdiction in erroneously interpreting the CBA provision and in failing to disregard the corporate entity of Acrylic. and (d) the employees of private respondent are the same persons manning and servicing the units of Acrylic. (b) many of private respondent's own machineries. (c) the services of a number of units. it does not preclude judicial review thereof where want of jurisdiction. Time and again. departments or sections of private respondent are provided to Acrylic. Marilao. reeling. pp. In sum. were transferred to and are now installed and being used in the Acrylic plant. We find the petition devoid of merit. offices and facilities situated in the same compound. boiler. Kamitsus among others. 12-13) Private respondent insists that the existence of a bonafide business relationship between Acrylic and private respondent is not a proof of being a single corporate entity because the services which are supposedly provided by it to Acrylic are auxiliary services or activities which are not really essential in the actual production of Acrylic. to wit: (a) the two corporations have their physical plants. (see Rollo.
September 13.P. that some of the employees of the private respondent are the same persons manning and providing for auxilliary services to .R.R. when valid grounds therefore exist. a professor of the U. 81677. First Division Minute Resolution citing Oceanic Bic Division (FFW) v. 25 July 1990. now the Institute for Industrial Relations. 189 SCRA 529. v. agency.R. G. the corporation will be considered as a mere association of persons. Asian Labor Education Center. The fact that the businesses of private respondent and Acrylic are related. National Labor Relations Commission. The members or stockholders of the corporation will be considered as the corporation. 130 SCRA 392) It should be emphasized that in rendering the subject arbitral award. Hence. Under the doctrine of piercing the veil of corporate entity.abuse of discretion. No. or defend crime. 542) In the case at bar. The doctrine applies when the corporate fiction is used to defeat public convenience. violation of due process. Court of Appeals. denial of substantial justice. alleging that the creation of the corporation is a devise to evade the application of the CBA between petitioner Union and private respondent Company. or when it is made as a shield to confuse the legitimate issues. No. public respondent cited facts and the law upon which he based the award. (Umali et al. conduit or adjunct of another corporation. found that the existing law and jurisprudence on the matter. or where a corporation is the mere alter ego or business conduit of a person. et al. While we do not discount the possibility of the similarities of the businesses of private respondent and Acrylic. G. No. July 16. Romero. the legal fiction that a corporation is an entity with a juridical personality separate and distinct from its members or stockholders may be disregarded. G. petitioner seeks to pierce the veil of corporate entity of Acrylic. public respondent did not abuse his discretion. v. that is liability will attach directly to the officers and stockholders. justify wrong. 1984. Contrary to petitioner's assertion. the voluntary arbitrator Teodorico Calica. 1990. supported the private respondent's contentions. neither are we inclined to apply the doctrine invoked by petitioner in granting the relief sought. (see Ocampo. L43890. or where the corporation is so organized and controlled and its affairs are so conducted as to make it merely an instrumentality. protect fraud. In such cases. 89561. or erroneous interpretation of the law were brought to our attention.
Ople (supra) that it is grave abuse of discretion to treat two companies as a single bargaining unit when these companies are indubitably distinct entities with separate juridical personalities. In the same case of Umali." In the instant case.J. Narvasa. SO ORDERED. JJ. offices and facilities are situated in the same compound. Article I of the CBA that the Acrylic is not an extension or expansion of private respondent.. We already emphasized that "the legal corporate entity is disregarded only if it is sought to hold the officers and stockholders directly liable for a corporate debt or obligation. as the bargaining representative of private respondent. the rank-and-file employees working at Acrylic should not be recognized as part of.the units of Acrylic. Cruz and Grino-Aquino. All premises considered. and that the physical plants. it is our considered opinion that these facts are not sufficient to justify the piercing of the corporate veil of Acrylic. the Acrylic not being an extension or expansion of private respondent. and/or within the scope of the petitioner. petitioner does not seek to impose a claim against the members of the Acrylic. et al. Furthermore. the Court is convinced that the public respondent Voluntary Arbitrator did not commit grave abuse of discretion in its interpretation of Section l(c). ACCORDINGLY. We already ruled in the case of Diatagon Labor Federation Local 110 of the ULGWP v. . concur. C. the petition is DENIED and the award of the respondent Voluntary Arbitrator are hereby AFFIRMED. Court of Appeals (supra). Hence. v..
: Assailed in this petition for certiorari for being violative of the "constitutional right of employees to self-organization which includes the right to form. discrimination and coercion on (sic) employees. specifically. 3 requested a conference with the University for the purpose of continuing the collective bargaining negotiations. Culled from the records are the following facts which led to the filing of the instant petition: On September 6. the preliminary conference was cancelled. join or assist labor organizations of their own choosing for purposes of collective bargaining. de la Serna. On March 26.THIRD DIVISION [G.R. refusal to bargain. 1988 reiterating its request for a conference and warning the University against committing acts of interference through its various meetings with both the academic and non-academic employees regarding their union affiliation and activities. DWUEU's resigned vice-president Mr. DWUEU-ALU sent a follow-up letter on March 23. DWUEU submitted its collective bargaining proposals. 2 After almost three years. vs. or on March 11. Brigido Urminita (or Urmeneta) wrote a letter addressed to the University unilaterally withdrawing the CBA proposals. However. DWUEU-ALU filed with the National Conciliation and Mediation Board of the Department of Labor and Employment a notice of strike on the grounds of bargaining deadlock and unfair labor practice acts. 1984. DECISION ROMERO. 1992. 91915. On April 25. SECRETARY OF LABOR AND EMPLOYMENT and DIVINE WORD UNIVERSITY EMPLOYEES UNION-ALU. 1989 and January 17. which had by then affiliated with the Associated Labor Union. 1985. 1990 issued by then Secretary of Labor and Employment Franklin H. Med-Arbiter Bienvenido C. Petitioner." 1 are the Orders of May 23. On March 7. Consequently. 1988. Elorcha certified the Divine Word University Employees Union (DWUEU) as the sole and exclusive bargaining agent of the Divine Word University (University for brevity). 1988. 1985. No. two days before the scheduled conference or on May 26. Respondents. the University persisted in maintaining silence. 1985. 4 Not having heard from the University.] DIVINE WORD UNIVERSITY OF TACLOBAN. Drilon and Acting Secretary of Labor and Employment Dionisio D. J. the University replied and requested a preliminary conference to be held on May 28. Despite the letter. 1985. 5 The conferences which were held after the filing of the notice of . respectively. September 11. DWUEU.
1988. 263(g) of the Labor Code. 4. May 13. Thereafter. exercising his powers under Art. These were ignored by the University. 5." 9 Said Order prompted the DWUEU-ALU to file with the Secretary of Labor an urgent motion seeking to enjoin Milado from further acting on the matter of the certification election. 1988 agreement was concluded. Nos. Union and management agrees (sic) to sit down and determine (sic) the number of employees that will represent their bargaining unit. submitted its collective bargaining proposals. 1987 in the Bulletin Today cases (G. marathon conciliation conferences were conducted but to no avail. 8 On the same day. 1988. 6. 2. 263 (g) of the Labor Code. consonant with the agreement. 10 The Labor Secretary's Order. DWUEU-ALU. predicated on his extraordinary powers under Art. Drilon.strike led to the conclusion of an agreement between the University and DWUEU-ALU on May 10. 7 On the other hand. then Secretary of Labor Franklin M. Jacinto shall be given 10 days notice in the next conciliation meeting. On September 20. the University had filed a petition for certification election with the Region VIII office of the Department of Labor and Employment. issued an Order directing the conduct of a certification election to be participated in by DWUEU-ALU and "no union. Hence. Med-Arbiter Rodolfo S. 3. through the National Conciliation and Mediation Board (NCMB) of Region VIII. it turned out that an hour before the May 10. Cinco Flores is settled. The Secretary added: ." 6 However." after he found the petition to be "wellsupported in fact and in law. acting on the University's petition for certification election. conformed with this Court s Resolution of October 29. 1988. 79276 and 79883) where the issue of strong disagreement among the parties on the question of representation was deemed subsumed in the labor dispute certified for compulsory arbitration. Atty. Colinayo and Ms. on May 19.R. the Labor Secretary granted said motion and directed Milado to hold in abeyance any and all certification election proceedings at the University pending the resolution of the labor dispute. Milado. 1988 for whatever action management will take. 1888 with the following terms: "1. Union will submit their (sic) CBA proposals on Friday. The issues of discrimination: re Ms. issued an Order assuming jurisdiction over the labor dispute and directing all striking workers to report back to work within twenty-four (24) hours and the management to accept them back under the same terms and conditions prevailing prior to the work stoppage. Conciliation proceedings is (sic) temporarily suspended until the parties inform this office of further development. The Secretary also designated the NCMB to hear the case and to submit its report thereon. on August 25. Issue (sic) on coercion and refusal to bargain shall be subject of continuing dialogue.
hours of work. compensation salary and wages. 1985 (Exh. The said proposals include among others. Moreover. the DWUEU's complaint docketed as NLRC Case No. in the words of the Supreme Court. More importantly. union scope. in said Order of May 23. 4). On October 26. and will prevent split jurisdiction and that multiplicity of proceedings which the law abhors' (24 December 1987 [should be December 17. are with merits. 12 Exercising once again his extraordinary powers under Art. terms and conditions of work. the Secretary of Labor said: "It is a matter of record that when the Union filed its Notice of Strike (Exh. 263(g) of the Labor Code. and the University's complaint docketed as NLRC Case No. (2) whether the complaints for unfair labor practices against each other filed by both parties. It is also worth mentioning that the CBA proposals by the Union were submitted on March 7. the Divine Word University Independent Faculty and Employees Union (DWUIFEU). union rights. which later on was subsumed by the assumption Order. including the legality of the strike with the NLRC. 8-032188. 1984 (Exh." 11 The NCMB of Region VIII conducted hearings on the case from October 17-18. and." On the first issue. 8-0323-88. 1987] resolution of the Supreme Court in the Bulletin Today cases. filed a motion for intervention alleging that it had "at least 20% of the rank and file employees" of the University. or necessarily related thereto" in his Order of May 23. The resolution of these issues in one proceeding is. union recognition. to allow a certification election to proceed at this point in time might further rupture the already strained labor-management relations pervading at the University. 1988."Underscoring the necessity to conform with this settled doctrine is the fact that the dispute over which this Office assumed jurisdiction arose from the alleged continued refusal by the University to negotiate a CBA with the Union despite the latter's certification as exclusive bargaining agent in 1984. 'meet and proper in view of the very special circumstances obtaining in this case. leave of absence. 1989 13 and the following cases were "subsumed or consolidated to the labor dispute": the petition for certification election docketed as MED-ARB-Case No. An examination of the CBA proposals submitted by the Union of the University showed there was (sic) some negotiations that has (sic) taken place as indicated on the handwritten notations made in the CBA proposal (Exh. job security. practices and privileges. the Secretary consolidated "the entire labor dispute including all incidents arising therefrom. (3) whether or not the certification election can be passed upon by this Office. F). 9) after Med-Arbiter Bienvenido Elorcha issued a certification election Order dated September 6. 1989. Thus. 5-04-88. The assumption order issued by this Office merely served as a temporary bond to hold together such a fragile relationship. 1988. union security. which was registered earlier that day. Necessarily related thereto is the representativity issue raised by the University in its certification election petition. workers' . A) two of the issues it raised were bargaining deadlock and refusal to bargain. the projected election hastily decreed would preempt the proper resolution of the issues raised and pursued so zealously by the employees that prompted them to stage their strike. the Secretary of Labor resolved these issues: "(1) whether there was refusal to bargain and an impasse in bargaining. supra).
workers' education. The said CBA proposals were indorsed by DWU President to Atty. The aforequoted rule clearly barred the Med-Arbiter from further entertaining the petition for certification election. a bargaining deadlock to which an incumbent or certified bargaining agent is a party has been submitted to conciliation or arbitration or had become the subject of a valid notice of strike or lockout. the various communications sent to the University by the Union prior to the filing of the notice of strike was enough opportunity for the former to raise the issue of representation if it really casts doubt to the majority status of the Union.M. 1988. 1988.' Clearly." 14 . 1985 to the Union indicated that the CBA negotiations process was set into motion. which unfortunately did not take place due to the alleged withdrawal of the CBA proposals. Apparently. Book V of the Rules Implementing the Labor Code applies and we quote: 'Sec. citing bargaining deadlock as one of the grounds (Annex '1'). while the Petition for Certification Election was filed by the DWU on 10 May 1988. In fact the deadlock remained unresolved and was in fact mutually agreed upon to be conciliated further by the NCMB as per items 1 and 5 of the 'Agreement' (Exhibit 'L'). The filing of the notice of strike was precipitated by the University's act of not replying to the Union's letters of March 11 and March 23. the Union and the DWU have not been able to conclude a CBA since its certification on 6 September 1984 by then Med-Arbiter Bienvenido Elorcha. strike and lockouts and grievance machinery. no certification election may be held within one year from the date of issuance of declaration of a final certification election result. However. The submission of the CBA proposals and the reply letter of the DWU counsel. When to file. The records show that the Notice of Strike was filed by the Union on 25 April 1988. retirement longevity pay.rights and safety. a bargaining deadlock exists and as a matter of fact this is being conciliated by the National Conciliation and Mediation Board at the time the University filed its Petition for Certification Election on 10 May 1988. 3. Neither may a representation question be entertained it (sic) before the filing of a petition for certification election. dated March 26. the move to file the petition on the same day was an afterthought on the part of the University which this Office considers as fatal. But the nonconclusion of a CBA within one year. Undeniably. Generosa R. as in this case. In the absence of a collective bargaining agreement submitted in accordance with Article 231 of the Code. does not automatically authorize the holding of a certification election when it appears that a bargaining deadlock issue has been submitted to conciliation by the certified bargaining agent. This being the case. DWU's counsel even suggested that the preliminary conference between the union and the university be scheduled on 28 May 1985 at 2:30 P. Furthermore. Divine Word University legal counsel together with a copy of the Union CBA proposals. Jacinto. Rule V. how come it entered into an agreement with the latter on May 10. if DWU indeed doubted the status of the union. Section 3. a petition for certification election may be filed at any time. More importantly.
DWU is hereby warned that any unwarranted delay in the execution of the collective bargaining agreement will be construed as an unfair labor practice act. 8-0321-88) but also the complaint filed by the University for unfair labor practices and illegal strike for "obvious lack of merit brought about by its utter failure to submit evidence" (NLRC Case No. 1989. 1989 conference. the University failed to appear.The same Order dismissed not only the case filed by DWUEU-ALU for unfair labor practice on the ground of the union's failure to prove the commission of the unfair labor practice acts specifically complained of (NLRC Case No. It was opposed by the DWUEU-ALU. On December 4." 15 The University filed a motion for the reconsideration of said Order. coercion of employees and illegal suspension. the University filed with the Office of the Secretary of Labor a motion praying that said Office assume jurisdiction over the dispute or certify the same to the NLRC for compulsory arbitration on the ground that the strike affected not only the University but also its other academic and non-academic employees. On said date. Likewise. its representative phoned in a request for the resetting of the conference purportedly because its Board of Directors had failed to muster a quorum. the Divine Word University of Tacloban and the Divine Word University Employees Union are hereby directed to enter into a collective bargaining agreement by adopting the Union's CBA proposals sent to the DWU President on 19 May 1988 (Exhibit '6'). 16 the Office of the Secretary called for a series of conciliation and mediation conferences between the parties. 1989. Hence. ALL THE FOREGOING PREMISES CONSIDERED. However. the DWUEU-ALU pursued its second notice of strike on November 24. Instead. 1989. the University agreed to submit its proposals on how to settle amicably the labor dispute on or before July 17. . respectively. the conference was rescheduled for July 19. NLRC CASES Nos. the Order has this dispositive portion: "WHEREFORE. the Office of the Secretary of Labor received a Resolution passed by the students of the University urging said Office's assumption of jurisdiction over the labor dispute and the earliest resolution of the case. Accordingly. the students and their parents. the said Order pronounced as untenable the University s claim that the assumption Order earlier issued by the Office of the Secretary of Labor merely held in abeyance the holding of a certification election and that the representation issue was not deemed consolidated by virtue of the said assumption Order. since on May 5. 8-0321-88 and 8-0323 filed by the Union and the DWU. Moreover. 1989 the DWUEU-ALU had filed a second notice of strike charging the University with violation of the return-to-work order of the Secretary of Labor and unfair labor practices such as dismissal of union officers. 1989. Citing the Bulletin Today cases. after so informing ALU's Eastern Visayas Vice-President. however. 8-0323-88). the petition for certification election filed by the University is hereby dismissed for lack of merit and the Order of Med-Arbiter Rodolfo Milado set aside. are hereby dismissed for lack of merit. The University once again failed to appear. Four days later. In view of the University's intransigence. At the July 5. SO ORDERED.
"dismissed" for lack of merit the University's motion for reconsideration and affirmed the Order of May 23. VIII to hear the issues raised in said notice of strike and to submit his findings and recommendations within ten days from submission of the case by the parties. 2. the University filed a Petition for Certification with (sic) Regional Office. Union will submit their (renewed) CBA proposals on Friday May 13. 1985 collective bargaining proposals of the DWUEU had not been validly withdrawn as the union's Vice-President had resigned and the withdrawal was signed only by three of the eight members of the Executive Board of said union. the Acting Secretary found that: ". the Acting Secretary believed that it did not "exculpate the University from the duty to bargain with the Union" because the collective bargaining processes had been "set in motion from the time the CBA proposals was (sic) received by the University until the impasse took place on account of its failure to reply to the Union's letters pursuing its CBA Proposals dated March 11 and 23." On January 17. it was agreed that the Union submit a renewed CBA proposal which it did on May 19. He noted the fact that the March 7. . 1988 Order which assumed jurisdiction over the labor dispute. 1988. The uncooperative posture of the University to respond and continue with the negotiations could very well be explained when one (1) hour prior to the start of the conciliation on May 10. xxx xxx xxx' On account of the deadlock regarding the March 7. Union and Management agree to sit down and determine the number of employees that will represent (constitute) their bargaining unit. As a matter of fact. 1988 with the Union which reads: 'a. That on the matter of Bargaining Deadlock — 1. The surreptitious filing of the petition and at the same time cunningly entering into an agreement which required the Union to submit a renewed CBA proposal. 1989. The records indicate otherwise Conciliation meetings were conducted precisely to discuss the CBA proposals the Union submitted to the University on March 7. deemed the issues raised in the May 5. 1989 notice of strike as "subsumed in this case". He ordered all striking workers to return to work within 24 hours and the University to accept them back under the same terms and conditions of employment. The records indicate that no response was made by the University. Secretary Drilon issued an Order reiterating the August 28.Consequently. and enjoined the parties to cease and desist from any act that may "aggravate the employer-employee relationship. ordered the Director of Regional Office No. the University admitted the existence of the deadlock when a provision was incorporated in the agreement it signed on May 10. 1989. Granting that the withdrawal was valid. Acting Secretary of Labor Dionisio L. 1988. is patently negotiating in bad faith. 1990. 1985. The University should have candidly and timely raised the issue . de la Serna. 1988 for whatever action management will take." On the University's assertion that no negotiations took place insofar as the March 7. 1985 collective bargaining proposals are concerned. on December 29. . 1985 CBA proposals. 1988.
Respondent Secretary committed grave and patent abuse of discretion in issuing his orders dated 23 May 1989 and 17 January 1990 disregarding evidence on record. In the absence of a certified CBA and there having been no certification election held in petitioner unit for more than five (5) years. B. a certification election is mandatory. the Office of the Secretary of Labor may rightfully impose the Union's May 19.of representation. 1990." i." It opines that since the Regional Director is an extension of the Secretary of Labor." 17 The Acting Secretary then concluded that for reneging on the agreement of May 10. Petitioner was denied due process. 1990. 1989 Order." the University should be "declared in default.. order. In its petition for certiorari and prohibition with preliminary injunction filed on February 9." 19 the petitioner University argues that the Secretary of Labor "cannot resolve petitioner's and (intervenor) DWU-IFEU's motions for reconsideration (in the NS. "to include within a larger class. if it believed that such issue was valid. Respondent Secretary committed grave and patent abuse of discretion amounting to lack of jurisdiction in issuing his order dated 17 January 1990 finally denying petitioner's motion for reconsideration in the face of the order dated 29 December 1989 and subsequent acts of DOLE official subsuming the second notice of strike with the first notice of strike. 1) of the Order dated 23 May 1989 until the proceedings in the subsumed NS. 1 and 2 before the he issued the Order of January 17. We agree with the Acting Secretary of Labor's observation that the action for intervention had in effect been denied by the dismissal of the petition for certification election in the May 23. 2 are terminated. the latter should have waited for the recommendation of the former on the issues in notices of strike nos.e. 1988 and for its "reluctance and subscription to legal delay. 1989. provisions of law and established jurisprudence. the University had recourse to instant petition. The May 10.. 1988 Agreement only served to falsely heighten the expectations of the Union and this Office that a mutually acceptable settlement of the dispute was in the offing. etc. group. C. On the University's contention that the motion for intervention of the DWU-IFEU was not resolved. 1988 collective bargaining agreement proposals motu proprio. The sub silencio treatment of the motion for intervention in said Order does not mean that . This Office cannot tolerate such actuations by the University. Hence. D." He also maintained that since under the circumstances the University cannot claim deprivation of due process. the Acting Secretary ruled that said motion was in effect denied when the petition for certification election filed by the University was dismissed in the Order of May 23. the University raises as grounds therefor the following: "A. not by entering into an agreement. 1989 notice of strike "are ordered subsumed in this case" and elaborating on the meaning of the word "subsume. 1989 Order of the Secretary of Labor which states that the issues raised in the May 5." 18 Citing the dispositive portion of the December 29.
the Bureau shall. If there is no existing certified collective bargaining agreement in the unit. its active role ceases and it becomes a mere bystander. resolution of the motion for reconsideration at the earliest possible time was urgently needed to set at rest the issues regarding the first notice of strike. The Secretary. Thus. However. petitioner's undue interest in the resolution of the DWU-IFEU's motion for intervention becomes significant since a certification election is the sole concern of employees except where the employer itself has to file a petition for certification election. 20 Petitioner's contention that the Acting Secretary of Labor should have deferred the issuance of the Order of January 17. But once an employer has filed said petition. On the issue of whether or not a certification election should have been ordered by the Secretary of Labor. could not have intended the efforts of the Regional Director to be inutile or fruitless. Ideally. the certification election and the unfair labor practice cases filed by the University and the DWUEU-ALU. When an employer may file petition. as shown by the findings of facts in the same Order.the motion was overlooked. It only means. Any uncalled-for concern on the part of the employer may give rise to the suspicion that it is batting for a company union. Book V of the Implementing Rules and Regulations of the same Code: "ART. that there was no necessity for the holding of a certification election wherein the DWU-IFEU could participate. or for that matter. the second notice of strike could not have been resolved as yet considering that at that time. The nature of the business of the University demanded immediate and effective action on the part of the respondent public officials. the Acting Secretary. order a certification election. The Bureau shall conduct a certification election within twenty (20) days in accordance with the rules and regulations prescribed by the Secretary of Labor. the Acting Secretary was acting in accordance with the exigencies of the circumstances of the case. as the petitioner did in this case. the studentry and their parents. All certification cases shall be decided within twenty (20) working days. a single decision or order should settle all controversies resulting from a labor dispute. 1990. the exigencies of a case may also demand that some matters be threshed out and resolved ahead of the others. This is in consonance with the principle of avoiding multiplicity of suits. Any contrary interpretation of the Secretary of Labor's powers under Art. untenable. Regional Director Teddy S. when he set aside the issues raised in the second notice of strike. under the circumstances. pertinent are the following respective provisions of the Labor Code and Rule V. . 1990 until after his receipt of the Regional Director's recommendation on the notices of strike is. after hearing. 258. Cabeltes was still conducting the conference between the parties in pursuance of the directive in the Order of December 19. It should be emphasized that on January 17. an employer may petition the Bureau for an election. In this case. Otherwise. Hardly can it be said to be an abuse of his discretion. 1989. 263(g) of the Labor Code on this matter would only result in confusion and delay in the resolution of the manageable aspects of the labor dispute. — When requested to bargain collectively. In this regard. not only the contending parties in the dispute would be adversely affected but more importantly.
Sec. 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. 3. as. However. (Emphasis supplied) If a collective bargaining agreement has been duly registered in accordance with Article 231 of the Code. the problem appears to lie in the fact that the Secretary of Labor had found that a bargaining deadlock exists. The other party shall make a reply thereto not later than . it shall serve a written notice upon the other party with a statement of its proposals. 250(a) of which states: "ART. While collective bargaining should be initiated by the union. 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. As it was evident that unilateral moves were being undertaken only by the DWUEU-ALU. 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." 22 The word is synonymous with the word impasse 23 which. there was no "counteraction" of forces or an impasse to speak of. within the meaning of the American federal labor laws. does not conclude in agreement between the parties. "presupposes reasonable effort at good faith bargaining which. When to file. despite noble intentions. before the filing of a petition for certification election. This is clear from the provisions of the Labor Code Art. 250. therefore. 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. — The following procedures shall be observed in collective bargaining: (a) When a party desires to negotiate an agreement. there is a corresponding responsibility on the part of the employer to respond in some manner to such acts." 21 There is a deadlock when there is a "complete blocking or stoppage resulting from the action of equal and opposed forces. Its indifferent attitude towards collective bargaining inevitably resulted in the failure of the parties to arrive at an agreement. the deadlock of a jury or legislature. no certification election may be held within one year from the date of issuance of a final certification election result." These provisions make it plain that in the absence of a collective bargaining agreement. Procedure in collective bargaining. there is no question as to the timeliness of the petition. Neither may a representation question be entertained if. — In the absence of a collective bargaining agreement duly registered in accordance with Article 231 of the Code." 24 A thorough study of the records reveals that there was no "reasonable effort at good faith bargaining" specially on the part of the University. a petition for certification election may be filed at any time. 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.
and (e) The Board shall exert all efforts to settle disputes amicably and encourage the parties to submit their case to a voluntary arbitrator. the parties are prohibited from doing any act which may disrupt or impede the early settlement of the disputes. As the Court earlier observed. Under the circumstances. while the Court recognizes that technically. either party may request for a conference which shall begin not later than ten (10) calendar days from the date of request. it exerted any effort to pursue collective bargaining as a means of attaining better terms of employment. through the ALU Director for Operations. 1988 may as well be considered the written notice to bargain referred to in the aforequoted Art. 250(a) of the Labor Code. 25 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. the same proposals could be considered as subsisting. Thus. said Union bound itself to submit a new set of proposals on May 13. the agreement of May 10. the Court cannot help but notice that the DWUEU was not entirely blameless in the matter of the delay in the bargaining process. 1985. While it is true that as early as March 7. its subsequent withdrawal by the DWUEU Vice-President being unauthorized and therefore ineffective. It was only after its affiliation with the ALU that the same union. The Board shall have the power to issue subpoenas requiring the attendance of the parties to such meetings. 1988. said union had submitted its collective bargaining proposals and that. there has not been a "reasonable effort at good faith bargaining" on the part of the University. the University has the right to file the petition for certification election as there was no bargaining deadlock to speak of. the record is replete with evidence on the University's reluctance and thinly disguised refusal to bargain with the duly certified bargaining agent. While DWUEU-ALU was opening all possible avenues for the conclusion of an agreement. 1988. (b) Should differences arise on the basis of such notice and reply. 1988 agreement with the University. It shall be the duty of the parties to participate fully and promptly in the conciliation meetings the Board may call. as in fact. DWUEU-ALU submitted its collective bargaining proposals. the Board shall intervene upon request of either or both parties or at its own initiative and immediately call the parties to conciliation meetings. . requested an "initial conference" for the purpose of collective bargaining. Be that as it may. to grant its prayer that the herein assailed Orders be annulled would put an unjustified premium on bad faith bargaining. the Court is not inclined to rule that there has been a deadlock or an impasse in the collective bargaining process. the fact remains that said union remained passive for three years. (d) During the conciliation proceedings in the Board. (c) If the dispute is not settled. which thereby set into motion the machinery for collective bargaining. such that the inescapable conclusion is that the University evidently had no intention of bargaining with it. The records do not show that during this three-year period. on May 19.ten (10) calendar days from receipt of such notice." Considering the procedure outlined above.
estopped from questioning the majority status of the said union. and observe honesty and good faith. And yet during said conference. the instant petition is hereby DISMISSED for lack of merit. it committed itself to "sit down" with the Union. therefore. 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." 28 That being the case. therefore. Kiok Loy v. By its acts. We. 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. no less than its inaction which bespeak its insincerity. Hence. find it superfluous to discuss the two other contentions in its petition. . 1988. the University's unscrupulous attitude towards the DWUEU-ALU is also betrayed by its belated questioning of the status of the said union. give everyone his due. and (c) the University made no counter proposal whatsoever. the University failed to act in accordance with Art." Moreover.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. "[a] company's refusal to make counter proposal if considered in relation to the entire bargaining process. As we said in Kiok Loy. Obviously. in the exercise of his rights and in the performance of his duties. the University even agreed "to sit down and determine the number of employees that will represent their bargaining unit. but it failed to do so. by filing the petition for certification election while agreeing to confer with the DWUEU-ALU. the University tried to preempt the conference which would have legally foreclosed its right to file the petition for certification election. A similar argument had already been disregarded in the case of Kiok Loy v. WHEREFORE. This decision is immediately executory. In so doing. may indicate bad faith and this is especially true where the Union's request for a counter proposal is left unanswered. 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. act with justice. 19 of the Civil Code that "(e)very person must. 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." This clearly indicates that the University recognized the DWUEU-ALU as the bargaining representative of the employees and is. On the other hand. 26 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." Moreover. the petitioner may not validly assert that its consent should be a primordial consideration in the bargaining process. 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. the University violated the mandate of Art. NLRC is applicable in the instant case considering that the facts therein have also been indubitably established in this case. Costs against the petitioner." 27 Moreover. NLRC. it has forfeited whatever rights it could have asserted as an employer. But an erring party should not be tolerated and allowed with impunity to resort to schemes feigning negotiations by going through empty gestures. in the agreement of May 10. it surreptitiously filed the petition for certification election.
JJ. Jr..SO ORDERED.. . is on leave. Jr. Gutierrez. and Melo. Bidin. Davide. concur.. J.
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