G.R. No.

L-54334 January 22, 1986

CUEVAS, J.:

KI K L !, "o#n$ %u&#n'&& un"'r ()' na*' an" &(y+' S,E-EN ICE CREA. /LAN0, petitioner, vs. NLRC an" /A.1ANSANG KILUSAN NG /AGGA,A 2KILUSAN3, respondents. Petition for certiorari to annul the decision 1 of the National Labor Relations Commission (NLRC) dated July 2 , !"#" $hich found petitioner %$eden &ce Cream 'uilty of unfair labor practice for un(ustified refusal to bar'ain, in violation of par. (') of )rticle 2*" 2 of the Ne$ Labor Code, 3 and declared the draft proposal of the +nion for a collective bar'ainin' a'reement as the 'overnin' collective bar'ainin' a'reement bet$een the employees and the mana'ement. ,he pertinent bac-'round facts are as follo$s. &n a certification election held on /ctober 0, !"#1, the Pambansan' 2ilusan' Pa''a$a (+nion for short), a le'itimate late labor federation, $on and $as subse3uently certified in a resolution dated November 2", !"#1 by the 4ureau of Labor Relations as the sole and e5clusive bar'ainin' a'ent of the ran-6and6file employees of %$eden &ce Cream Plant (Company for short). ,he Company7s motion for reconsideration of the said resolution $as denied on January 28, !"#1. ,hereafter, and more specifically on 9ecember #, !"#1, the +nion furnished 4 the Company $ith t$o copies of its proposed collective bar'ainin' a'reement. )t the same time, it re3uested the Company for its counter proposals. :licitin' no response to the aforesaid re3uest, the +nion a'ain $rote the Company reiteratin' its re3uest for collective bar'ainin' ne'otiations and for the Company to furnish them $ith its counter proposals. 4oth re3uests $ere i'nored and remained unacted upon by the Company. Left $ith no other alternative in its attempt to brin' the Company to the bar'ainin' table, the +nion, on ;ebruary !*, !"#", filed a <Notice of %tri-e<, $ith the 4ureau of Labor Relations (4LR) on 'round of unresolved economic issues in collective bar'ainin'. 5 Conciliation proceedin's then follo$ed durin' the thirty6day statutory coolin'6off period. 4ut all attempts to$ards an amicable settlement failed, promptin' the 4ureau of Labor Relations to certify the case to the National Labor Relations Commission (NLRC) for compulsory arbitration pursuant to Presidential 9ecree No. 120, as amended. ,he labor arbiter, )ndres ;idelino, to $hom the case $as assi'ned, set the initial hearin' for )pril 2", !"#". ;or failure ho$ever, of the parties to submit their respective position papers as re3uired, the said hearin' $as cancelled and reset to another date. =ean$hile, the +nion submitted its position paper. ,he Company did not, and instead re3uested for a resettin' $hich $as 'ranted. ,he Company $as directed ane$ to submit its financial statements for the years !"#>, !"##, and !"#1. ,he case $as further reset to =ay !!, !"#" due to the $ithdra$al of the Company7s counsel of record, )tty. Rodolfo dela Cru?. /n =ay 2*, !"#1, )tty. ;ortunato Pan'aniban formally entered his appearance as counsel for the Company only to re3uest for another postponement alle'edly for the purpose of ac3uaintin' himself $ith the case. =ean$hile, the Company submitted its position paper on =ay 21, !"#". @hen the case $as called for hearin' on June *, !"#" as scheduled, the Company7s representative, =r. Chin', $ho $as supposed to be e5amined, failed to appear. )tty. Pan'aniban then re3uested for another postponement $hich the labor arbiter denied. Ae also ruled that the Company has $aived its ri'ht to present further evidence and, therefore, considered the case submitted for resolution. /n July !1, !"#", labor arbiter )ndres ;idelino submitted its report to the National Labor Relations Commission. /n July 2 , !"#", the National Labor Relations Commission rendered its decision, the dispositive portion of $hich reads as follo$s. @A:R:;/R:, the respondent %$eden &ce Cream is hereby declared 'uilty of un(ustified refusal to bar'ain, in violation of %ection (') )rticle 2*1 (no$ )rticle 2*"), of P.9. **2, as amended. ;urther, the draft proposal for a collective bar'ainin' a'reement (:5h. <: <) hereto attached and made an inte'ral part of this decision, sent by the +nion (Private respondent) to the respondent (petitioner herein) and $hich is hereby found to be reasonable under the premises, is hereby declared to be the collective a'reement $hich should 'overn the relationship bet$een the parties herein. %/ /R9:R:9. (:mphasis supplied) Petitioner no$ comes before +s assailin' the aforesaid decision contendin' that the National Labor Relations Commission acted $ithout or in e5cess of its (urisdiction or $ith 'rave abuse of discretion amountin' to lac- of (urisdiction in renderin' the challen'ed decision. /n )u'ust *, !"1 , this Court dismissed the petition for lac- of merit. +pon motion of the petitioner, ho$ever, the Resolution of dismissal $as reconsidered and the petition $as 'iven due course in a Resolution dated )pril !, !"1!. Petitioner Company no$ maintains that its ri'ht to procedural due process has been violated $hen it $as precluded from presentin' further evidence in support of its stand and $hen its re3uest for further postponement $as denied. Petitioner further contends that the National Labor Relations Commission7s findin' of unfair labor practice for refusal to bar'ain is not supported by la$ and the evidence considerin' that it $as only on =ay 2*, !"#" $hen the +nion furnished them $ith a copy of the proposed Collective 4ar'ainin' )'reement and it $as only then that they came to -no$ of the +nion7s demandsB and finally, that the Collective 4ar'ainin' )'reement approved and adopted by the National Labor Relations Commission is unreasonable and lac-s le'al basis.

,he petition lac-s merit. Conse3uently, its dismissal is in order. Collective bar'ainin' $hich is defined as ne'otiations to$ards a collective a'reement, 6 is one of the democratic frame$or-s under the Ne$ Labor Code, desi'ned to stabili?e the relation bet$een labor and mana'ement and to create a climate of sound and stable industrial peace. &t is a mutual responsibility of the employer and the +nion and is characteri?ed as a le'al obli'ation. %o much so that )rticle 2*", par. (') of the Labor Code ma-es it an unfair labor practice for an employer to refuse <to meet and convene promptly and e5peditiously in 'ood faith for the purpose of ne'otiatin' an a'reement $ith respect to $a'es, hours of $or-, and all other terms and conditions of employment includin' proposals for ad(ustin' any 'rievance or 3uestion arisin' under such an a'reement and e5ecutin' a contract incorporatin' such a'reement, if re3uested by either party. @hile it is a mutual obli'ation of the parties to bar'ain, the employer, ho$ever, is not under any le'al duty to initiate contract ne'otiation. 4 ,he mechanics of collective bar'ainin' is set in motion only $hen the follo$in' (urisdictional preconditions are present, namely, (!) possession of the status of ma(ority representation of the employees7 representative in accordance $ith any of the means of selection or desi'nation provided for by the Labor CodeB (2) proof of ma(ority representationB and (0) a demand to bar'ain under )rticle 28!, par. (a) of the Ne$ Labor Code . ... all of $hich preconditions are undisputedly present in the instant case. ;rom the over6all conduct of petitioner company in relation to the tas- of ne'otiation, there can be no doubt that the +nion has a valid cause to complain a'ainst its (Company7s) attitude, the totality of $hich is indicative of the latter7s disre'ard of, and failure to live up to, $hat is en(oined by the Labor Code C to bar'ain in 'ood faith. @e are in total conformity $ith respondent NLRC7s pronouncement that petitioner Company is D+&L,E of unfair labor practice. &t has been indubitably established that (!) respondent +nion $as a duly certified bar'ainin' a'entB (2) it made a definite re3uest to bar'ain, accompanied $ith a copy of the proposed Collective 4ar'ainin' )'reement, to the Company not only once but t$ice $hich $ere left unans$ered and unacted uponB and (0) the Company made no counter proposal $hatsoever all of $hich conclusively indicate lac- of a sincere desire to ne'otiate. 8 ) Company7s refusal to ma-e counter proposal if considered in relation to the entire bar'ainin' process, may indicate bad faith and this is specially true $here the +nion7s re3uest for a counter proposal is left unans$ered. 9 :ven durin' the period of compulsory arbitration before the NLRC, petitioner Company7s approach and attitude6stallin' the ne'otiation by a series of postponements, non6appearance at the hearin' conducted, and undue delay in submittin' its financial statements, lead to no other conclusion e5cept that it is un$illin' to ne'otiate and reach an a'reement $ith the +nion. Petitioner has not at any instance, evinced 'ood faith or $illin'ness to discuss freely and fully the claims and demands set forth by the +nion much less (ustify its opposition thereto.15 ,he case at bar is not a case of first impression, for in the Herald Delivery Carriers Union (PAFLU) vs. Herald Publications 11the rule had been laid do$n that <unfair labor practice is committed $hen it is sho$n that the respondent employer, after havin' been served $ith a $ritten bar'ainin' proposal by the petitionin' +nion, did not even bother to submit an ans$er or reply to the said proposal ,his doctrine $as reiterated ane$ in Bradman vs. Court of Industrial elations 12 $herein it $as further ruled that <$hile the la$ does not compel the parties to reach an a'reement, it does contemplate that both parties $ill approach the ne'otiation $ith an open mind and ma-e a reasonable effort to reach a common 'round of a'reement )s a last6ditch attempt to effect a reversal of the decision sou'ht to be revie$ed, petitioner capitali?es on the issue of due process claimin', that it $as denied the ri'ht to be heard and present its side $hen the Labor )rbiter denied the Company7s motion for further postponement. Petitioner7s aforesaid submittal failed to impress +s. Considerin' the various postponements 'ranted in its behalf, the claimed denial of due process appeared totally bereft of any le'al and factual support. )s herein earlier stated, petitioner had not even honored respondent +nion $ith any reply to the latter7s successive letters, all 'eared to$ards brin'in' the Company to the bar'ainin' table. &t did not even bother to furnish or serve the +nion $ith its counter proposal despite persistent re3uests made therefor. Certainly, the moves and overall behavior of petitioner6company $ere in total dero'ation of the policy enshrined in the Ne$ Labor Code $hich is aimed to$ards e5peditin' settlement of economic disputes. Aence, this Court is not prepared to affi5 its imprimatur to such an ille'al scheme and dubious maneuvers. Neither are @: persuaded by petitioner6company7s stand that the Collective 4ar'ainin' )'reement $hich $as approved and adopted by the NLRC is a total nullity for it lac-s the company7s consent, much less its ar'ument that once the Collective 4ar'ainin' )'reement is implemented, the Company $ill face the prospect of closin' do$n because it has to pay a sta''erin' amount of economic benefits to the +nion that $ill e3ual if not e5ceed its capital. %uch a stand and the evidence in support thereof should have been presented before the Labor )rbiter $hich is the proper forum for the purpose. @e a'ree $ith the pronouncement that it is not obli'atory upon either side of a labor controversy to precipitately accept or a'ree to the proposals of the other. 4ut an errin' party should not be tolerated and allo$ed $ith impunity to resort to schemes fei'nin' ne'otiations by 'oin' throu'h empty 'estures. 13 =ore so, as in the instant case, $here the intervention of the National Labor Relations Commission $as properly sou'ht for after conciliation efforts underta-en by the 4LR failed. ,he instant case bein' a certified one, it must be resolved by the NLRC pursuant to the mandate of P.9. 1#0, as amended, $hich authori?es the said body to determine the reasonableness of the terms and conditions of employment embodied in any Collective 4ar'ainin' )'reement. ,o that e5tent, utmost deference to its findin's of reasonableness of any Collective 4ar'ainin' )'reement as the 'overnin' a'reement by the employees and mana'ement must be accorded due respect by this Court.

@A:R:;/R:, the instant petition is 9&%=&%%:9. ,he temporary restrainin' order issued on )u'ust 2#, !"1 , is L&;,:9 and %:, )%&9:. No pronouncement as to costs. %/ /R9:R:9. G.R. No. 145518 -'6'*%'r 16, 2554 A7CUNA, J.8

.ANILA -IA. N- 9 0EL E./L !EES: UNI N, petitioner, vs. CA, 09E SECRE0AR! ; LA1 R AN- E./L !.EN0, an" 09E .ANILA -IA. N- 9 0EL, respondents. ,his petition for revie$ of a decision of the Court of )ppeals arose out of a dispute bet$een the Philippine 9iamond Aotel and Resort, &nc. (<Aotel<), o$ner of the =anila 9iamond Aotel, and the =anila 9iamond Aotel :mployeesF +nion (<+nion<). ,he facts are as follo$s. /n November !!, !"">, the +nion filed a petition for a certification election so that it may be declared the e5clusive bar'ainin' representative of the AotelFs employees for the purpose of collective bar'ainin'. ,he petition $as dismissed by the 9epartment of Labor and :mployment (9/L:) on January !8, !""#. )fter a fe$ months, ho$ever, on )u'ust 28, !""#, the +nion sent a letter to the Aotel informin' it of its desire to ne'otiate for a collective bar'ainin' a'reement.! &n a letter dated %eptember !!, !""#, the AotelFs Auman Resources 9epartment =ana'er, =ary )nne =an'alindan, $rote to the +nion statin' that the Aotel cannot reco'ni?e it as the employeesF bar'ainin' a'ent since its petition for certification election had been earlier dismissed by the 9/L:.2 /n that same day, the Aotel received a letter from the +nion statin' that they $ere not 'ivin' the Aotel a notice to bar'ain, but that they $ere merely as-in' for the Aotel to en'a'e in collective bar'ainin' ne'otiations $ith the +nion for its members only and not for all the ran- and file employees of the Aotel.0 /n %eptember !1, !""#, the +nion announced that it $as ta-in' a stri-e vote. ) Notice of %tri-e $as thereafter filed on %eptember 2", !""#, $ith the National Conciliation and =ediation 4oard (NC=4) for the AotelFs alle'ed <refusal 5 5 5 to bar'ain< and for alle'ed acts of unfair labor practice. ,he NC=4 summoned both parties and held a series of dialo'ues, the first of $hich $as on /ctober >, !""#. /n November 2", !""#, ho$ever, the +nion sta'ed a stri-e a'ainst the Aotel. Numerous confrontations bet$een the t$o parties follo$ed, creatin' an obvious strain bet$een them. ,he Aotel claims that the stri-e $as ille'al and it had to dismiss some employees for their participation in the alle'edly ille'al concerted activity. ,he +nion, on the other hand, accused the Aotel of ille'ally dismissin' the $or-ers. @hat is pertinent to this case, ho$ever, is the /rder issued by the then %ecretary of Labor and :mployment Cresenciano 4. ,ra(ano assumin' (urisdiction over the labor dispute. ) Petition for )ssumption of Jurisdiction $as filed by the +nion on )pril 2, !""1. ,hereafter, the %ecretary of Labor and :mployment issued an /rder dated )pril !8, !""1, the dispositive portion of $hich states. @A:R:;/R:, premises consideredG,H this /ffice C:R,&;&:% the labor dispute at the =anila 9iamond Aotel to the National Labor Relations Commission, for compulsory arbitration, pursuant to )rticle 2>0 (') of the Labor Code, as amended. )ccordin'ly, the stri-in' officers and members of the =anila 9iamond Aotel :mployees +nion 666 N+@AR)&N are hereby directed to return to $or- $ithin t$enty6four (2*) hours upon receipt of this /rder and the Aotel to accept them bac- under the same terms and conditions prevailin' prior to the stri-e. ,he parties are en(oined from committin' any act that may e5acerbate the situation. ,he +nion received the aforesaid /rder on )pril !>, !""1 and its members reported for $or- the ne5t day, )pril !#, !""1. ,he Aotel, ho$ever, refused to accept the returnin' $or-ers and instead filed a =otion for Reconsideration of the %ecretaryFs /rder. /n )pril 0 , !""1, then )ctin' %ecretary of Labor Jose =. :spaIol, issued the disputed /rder, $hich modified the earlier one issued by %ecretary ,ra(ano. &nstead of an actual return to $or-, )ctin' %ecretary :spaIol directed that the stri-ers be reinstated only in the payroll.* ,he +nion moved for the reconsideration of this /rder, but its motion $as denied on June 28, !""1. Aence, it filed before this Court on )u'ust 2>, !""1, a petition for certiorariunder Rule >8 of the Rules of Court alle'in' 'rave abuse of discretion on the part of the %ecretary of Labor for modifyin' its earlier order and re3uirin' instead the reinstatement of the employees in the payroll. Ao$ever, in a resolution dated July !2, !""", this Court referred the case to the Court of )ppeals, pursuant to the principle embodied in !ational Federation of Labor v. La"uesma.8 /n /ctober !", !""", the Court of )ppeals rendered a 9ecision dismissin' the +nionFs petition and affirmin' the %ecretary of LaborFs /rder for payroll reinstatement. ,he Court of )ppeals held that the challen'ed order is merely an error of (ud'ment and not a 'rave abuse of discretion and that payroll reinstatement is not prohibited by la$, but may be <called for< under certain circumstances.> Aence, the +nion no$ stands before this Court maintainin' that. ,A: A/N/R)4L: C/+R, /; )PP:)L% DR&:J&/+%LE :RR:9 &N R+L&ND ,A), ,A: %:CR:,)RE /; L)4/RF% +N)+,A/R&K:9 /R9:R /; =:R: <P)ER/LL R:&N%,),:=:N,< &% N/, DR)J: )4+%: /; 9&%CR:,&/N # ,he petition has merit. ,he Court of )ppeals based its decision on this CourtFs rulin' in University of #anto $omas (U#$) v. !L C.1,here, the %ecretary assumed (urisdiction over the labor dispute bet$een stri-in' teachers and the university. Ae ordered the stri-in' teachers to return to

$or- and the university to accept them under the same terms and conditions. Ao$ever, in a subse3uent order, the NLRC provided payroll reinstatement for the stri-in' teachers as an alternative remedy to actual reinstatement. ,rue, this Court held therein that the NLRC did not commit 'rave abuse of discretion in providin' for the alternative remedy of payroll reinstatement. ,his Court found that it $as merely an error of (ud'ment, $hich is not correctible by a special civil action for certiorari. ,he NLRC $as only tryin' its best to $or- out a satisfactory ad %oc solution to a festerin' and serious problem. Ao$ever, this Court notes that the U#$ rulin' $as made in the li'ht of one very important fact. the teachers could not be 'iven bactheir academic assi'nments since the order of the %ecretary for them to return to $or- $as 'iven in the middle of the first semester of the academic year. ,he NLRC $as, therefore, faced $ith a situation $here the stri-in' teachers $ere entitled to a return to $or- order, but the university could not immediately reinstate them since it $ould be impracticable and detrimental to the students to chan'e teachers at that point in time. &n the present case, there is no sho$in' that the facts called for payroll reinstatement as an alternative remedy. ) strained relationship bet$een the stri-in' employees and mana'ement is no reason for payroll reinstatement in lieu of actual reinstatement. Petitioner correctly points out that labor disputes naturally involve strained relations bet$een labor and mana'ement, and that in most stri-es, the relations bet$een the stri-ers and the non6stri-ers $ill similarly be tense." 4itter labor disputes al$ays leave an aftermath of stron' emotions and unpleasant situations. Nevertheless, the 'overnment must still perform its function and apply the la$, especially if, as in this case, national interest is involved. )fter ma-in' the distinction bet$een U#$ and the present case, this Court no$ addresses the issue of $hether the Court of )ppeals erred in rulin' that the %ecretary did not commit any 'rave abuse of discretion in orderin' payroll reinstatement in lieu of actual reinstatement. ,his 3uestion is ans$ered by the nature of )rticle 2>0('). )s a 'eneral rule, the %tate encoura'es an environment $herein employers and employees themselves must deal $ith their problems in a manner that mutually suits them best. ,his is the basic policy embodied in )rticle L&&&, %ection 0 of the Constitution,! $hich $as further echoed in )rticle 2!! of the Labor Code.!! Aence, a voluntary, instead of compulsory, mode of dispute settlement is the 'eneral rule. Ao$ever, )rticle 2>0, para'raph (') of the Labor Code, $hich allo$s the %ecretary of Labor to assume (urisdiction over a labor dispute involvin' an industry indispensable to the national interest, provides an e5ception. (') @hen, in his opinion, there e5ists a labor dispute causin' or li-ely to cause a stri-e or loc-out in an industry indispensable to the national interest, the %ecretary of Labor and :mployment may assume (urisdiction over the dispute and decide it or certify the same to the Commission for compulsory arbitration. %uch assumption or certification shall have the effect of automatically en(oinin' the intended or impendin' stri-e or loc-out as specified in the assumption or certification order. &f one has already ta-en place at the time of assumption or certification, all stri-in' or loc-ed out employees shall immediately return to $or- and the employer shall immediately resume operations and readmit all $or-ers under the same terms and conditions prevailin' before the stri-e or loc-out. 5 5 5 ,his provision is vie$ed as an e5ercise of the police po$er of the %tate. ) prolon'ed stri-e or loc-out can be inimical to the national economy and, therefore, the situation is imbued $ith public necessity and involves the ri'ht of the %tate and the public to self6 protection.!2 +nder )rticle 2>0('), all $or-ers must immediately return to $or- and all employers must readmit all of them under the same terms and conditions prevailin' before the stri-e or loc-out. ,his Court must point out that the la$ uses the precise phrase of <under the same terms and conditions,< revealin' that it contemplates only actual reinstatement. ,his is in -eepin' $ith the rationale that any $orstoppa'e or slo$do$n in that particular industry can be inimical to the national economy. &t is clear that )rticle 2>0(') $as not $ritten to protect labor from the e5cesses of mana'ement, nor $as it $ritten to ease mana'ement from e5penses, $hich it normally incurs durin' a $or- stoppa'e or slo$do$n. &t $as an error on the part of the Court of )ppeals to vie$ the assumption order of the %ecretary as a measure to protect the stri-in' $or-ers from any retaliatory action from the Aotel. ,his Court reiterates that this la$ $as $ritten as a means to be used by the %tate to protect itself from an emer'ency or crisis. &t is not for labor, nor is it for mana'ement. &t is, therefore, evident from the fore'oin' that the %ecretaryFs subse3uent order for mere payroll reinstatement constitutes 'rave abuse of discretion amountin' to lac- or e5cess of (urisdiction. &ndeed, this Court has al$ays reco'ni?ed the <'reat breadth of discretion< by the %ecretary once he assumes (urisdiction over a labor dispute. Ao$ever, payroll reinstatement in lieu of actual reinstatement is a departure from the rule in these cases and there must be sho$in' of special circumstances renderin' actual reinstatement impracticable, as in the U#$ case aforementioned, or other$ise not conducive to attainin' the purpose of the la$ in providin' for assumption of (urisdiction by the %ecretary of Labor and :mployment in a labor dispute that affects the national interest. None appears to have been established in this case. :ven in the e5ercise of his discretion under )rticle 20>('), the %ecretary must al$ays -eep in mind the purpose of the la$. ,ime and a'ain, this Court has held that $hen an official by6passes the la$ on the asserted 'round of attainin' a laudable ob(ective, the same $ill not be maintained if the intendment or purpose of the la$ $ould be defeated.!0 ,9ERE; RE, the petition is DR)N,:9 and the assailed 9ecision of the Court of )ppeals dated /ctober !", !""" is R:J:R%:9 and %:, )%&9:. ,he /rder dated )pril 0 , !""1 issued by the %ecretary of Labor and :mployment modifyin' the earlier /rder dated )pril !8, !""1, is li-e$ise %:, )%&9:. No pronouncement as to costs. S R-ERE-.

ART. III, S'6(#on 8. ,he ri'ht of the people, includin' those employed in the public and private sectors, to form unions, associations, or societies for purposes not contrary to la$ shall not be abrid'ed. ART. XIII, S'6(#on 3. ,he %tate shall afford full protection to labor, local and overseas, or'ani?ed and unor'ani?ed, and promote full employment and e3uality of employment opportunities for all. &t shall 'uarantee the ri'hts of all $or-ers to self6or'ani?ation, collective bar'ainin' and ne'otiations, and peaceful concerted activities, includin' the ri'ht to stri-e in accordance $ith la$. ,hey shall be entitled to security of tenure, humane conditions of $or-, and a livin' $a'e. ,hey shall also participate in policy and decision6ma-in' processes affectin' their ri'hts and benefits as may be provided by la$. ,he %tate shall promote the principle of shared responsibility bet$een $or-ers and employers and the preferential use of voluntary modes in settlin' disputes, includin' conciliation, and shall enforce their mutual compliance there$ith to foster industrial peace. ,he %tate shall re'ulate the relations bet$een $or-ers and employers, reco'ni?in' the ri'ht of labor to its (ust share in the fruits of production and the ri'ht of enterprises to reasonable returns to investments, and to e5pansion and 'ro$th. G.R. No. L-49546 January 26, 1988 ;ERNAN, J.:

SA0URN A. VIC0 RIA, petitioner, vs. 9 N. A.A- G. INCI NG, -E/U0! .INIS0ER, an" ;AR EAS0 1R A-CAS0ING C ., INC., respondents. Petition for revie$ of the /rder of the then )ctin' %ecretary of Labor )mado D. &ncion' dated June >, !"#1, in NLRC Case No. R46 !#>*6#8, reversin' the decision of the National Labor Relations Commission dated November !#, !"#> and holdin' that, under the la$ and facts of the case, there $as no necessity for private respondent to obtain a clearance for the termination of petitioner7s employment under )rticle 28# GbH of the Labor Code, as amended, and that a mere report of such termination $as sufficient, under %ection !! GfH. Rule L&J of the Rules and Re'ulations implementin' said Code. Petitioner %aturno Jictoria $as employed on =arch !#, !"8> by private respondent ;ar :ast 4roadcastin' Company, &ncorporated as a radio transmitter operator. %ometime in July !"#!, he and his co6$or-ers or'ani?ed the ;ar :ast 4roadcastin' Company :mployees )ssociation. )fter re'isterin' their association $ith the then 9epartment of Labor, they demanded reco'nition of said association by the company but the latter refused on the 'round that bein' a non6profit, non6stoc-, non6commercial and reli'ious corporation, it is not covered by Republic )ct 1#8, other$ise -no$n as the &ndustrial Peace )ct, the labor la$ enforced at that time. %everal conciliation meetin's $ere held at the 9epartment of Labor and in those meetin's, the 9irector of Labor Relations :dmundo Cabal advised the union members that the company could not be forced to reco'ni?e them or to bar'ain collectively $ith them because it is a non6profit, non6commercial and reli'ious or'ani?ation. Not$ithstandin' such advice, the union members led by %aturno Jictoria as its president, declared a stri-e and pic-eted the company7s premises on %eptember >, !"#2 for the purpose of see-in' reco'nition of the labor union. )s a countermeasure, the company filed a case for dama'es $ith preliminary in(unction a'ainst the stri-ers before the then Court of ;irst &nstance of 4ulacan doc-eted as Civil Case No. #8 6J. %aid court issued an in(unction en(oinin' the three6day6old stri-e sta'ed a'ainst the company. ,he complaint $as later amended see-in' to declare the stri-e ille'al. +pon the declaration of martial la$ on %eptember 2!, !"#2 and the promul'ation of Presidential 9ecree No. 2! creatin' the National Labor Relations Commission, the ad %oc National Labor Relations Commission too- co'ni?ance of the stri-e throu'h NLRC Case No. 2! entitled <Far &ast Broadcastin" Com'any &m'loyees Association, complainant versus Far &ast Broadcastin" Com'any, respondent< and NLRC Case No. 218 entitled <(eneroso #erino, complainant, versus Far &ast Broadcastin" Com'any, respondent<, both cases for reinstatement due to the company7s return to accept the union7s offer to return to $or- durin' the pendency of the case in the Court of ;irst &nstance. /n 9ecember 21, !"#2, )rbitrator ;lavio )'uas rendered a (oint decision in the t$o cases mentioned above reco'ni?in' the (urisdiction of the Court of ;irst &nstance of 4ulacan, the dispositive portion readin' as follo$s. &N J&:@ @A:R:/;, and in the interest of (ustice and e3uity, it is hereby directed that. !. ,hat stri-in' members of the ;ar :ast 4roadcastin' Company :mployees )ssociation return to their respective positions in the corporationB 2. ,he respondent ;ar :ast 4roadcastin' Company &ncorporated to accept bac- the returnin' stri-ers $ithout loss in ran- seniority or statusB 0. ,he $or-ers shall return to $or- $ithin G! H days from receipt of this resolution other$ise they shall be deemed to have forfeited such ri'htB

*. ,he respondent shall report compliance $ith this decision $ithin fifteen G!8H days from receipt hereof. ,his /rder shall, ho$ever, be $ithout pre(udice to $hatever decision the Court of ;irst &nstance of 4ulacan may promul'ate in Civil Case No. #8 6J and to the re3uirements the e5istin' order may need of people $or-in' $ith the mass media of communications. &, &% %/ /R9:R:9. 1 ,he decision of the arbitrator $as successively appealed to the ad %oc National Labor Relations Commission, the %ecretary of Labor and the /ffice of the President of the Philippines, and $as affirmed in all instances. /n )pril 20, !"#8, the Court of ;irst &nstance of 4ulacan rendered (ud'ment, to $it. @A:R:;/R:, (ud'ment is hereby rendered. !. =a-in' in(unction a'ainst defendants permanentB 2. 9eclarin' that this Court has (urisdiction to try and hear the instant case despite %ection 2 of Presidential 9ecree No. 2B 0. 9eclarin' that plaintiff ;ar :ast 4roadcastin' Company is a non6profit or'ani?ation since it does not declare dividendsB *. 9eclarin' that the stri-e admitted by the defendants to have been declared by them is ille'al inasmuch as it $as for the purpose of compellin' the plaintiff6company to reco'ni?e their labor union $hich could not be le'ally done because the plaintiffs $ere not covered by Republic )ct 1#8B 8. 9eclarin' that the evidence presented is insufficient to sho$ that defendants caused the dama'e to the plaintiff conse3uent on the destruction of its relays and its antennas as $ell as its transmission lines. %/ /R9:R:9. 2 /n )pril 2*, !"#8, by virtue of the above decision, the company notified %aturno Jictoria that he is dismissed effective )pril 2>, !"#8. ,hereupon, he filed Case No. R46&J6!#>* before the National Labor Relations Commission, Re'ional 4ranch &J a'ainst the company alle'in' violation of article 2># of the Labor Code $hich re3uires clearance from the %ecretary of Labor for every shutdo$n of business establishments or dismissal of employees. /n ;ebruary 2#, !"#>, Labor )rbiter =anuel 4. Loren?o rendered a decision in petitioner7s favor declarin' the dismissal to be ille'al, thereby orderin' reinstatement $ith fun bac-$a'es. /n appeal, the arbiter7s decision $as aimed by the National Labor Relations Commission. 4ut $hen the commission7s decision $as in turn appealed to the %ecretary of Labor, it $as set aside and in lieu thereof the 3uestioned /rder dated June >, !"#1 $as issued. &n vie$ of its brevity and for a better understandin' of the reasons behind it, @e 3uote the disputed /rder in full. /R9:R ,his is an appeal by respondent from the 9ecision of the National Labor Relations Commission, dated November !#, !"#>. ,he Commission upheld the 9ecision of the labor arbiter dated ;ebruary 2#, !"#> orderin' respondent to reinstate $ith full bac-$a'es herein complainant %aturno ). Jictoria based on the findin' that respondent did not file any application for clearance to terminate the services of complainant before dismissin' him from his employment. 4riefly the facts of this case are as follo$s. Complainant %aturno Jictoria is the president of the ;ar :ast 4roadcastin' Company :mployees +nion. /n %eptember 1, !"#2, the said union declared a stri-e a'ainst respondent company. /n %eptember !!, !"#2, respondent filed $ith the Court of ;irst &nstance of 4ulacan, Civil Case No. #8 6J, for the issuance of an in(unction and a prayer that the stri-e be declared ille'al. /n /ctober 2*, !"#2, complainant to'ether $ith the other stri-ers filed $ith the ad %oc National Labor Relations Commission Case Nos. 2! and 218 for reinstatement. ,he )rbitrator rendered a decision in said case on 9ecember 21, !"#2, $herein he ordered respondent to reinstate complainants sub(ect to the follo$in' condition. <,his /rder shall, ho$ever, be $ithout pre(udice to $hatever decision the Court of ;irst &nstance may promul'ate on Civil Case No. #8 6J and to the re3uirements the e5istin' order may need of people $or-in' $ith the mass media of communications.<

%ince said decision $as affirmed by the NLRC, the %ecretary of Labor, and the /ffice of the President of the Philippines, complainants $ere reinstated pursuant thereto. &n a 9ecision dated )pril 20, !"#8, in Civil Case No. #8 6J, promul'ated by the Court of ;irst &nstance of 4ulacan, the stri-e sta'ed by herein complainant and the other stri-ers $as declared ille'al. 4ased on said 9ecision, respondent dismissed complainant from his employment. Aence, complainant filed the instant complaint for ille'al dismissal. +nder the aforecited facts, $e do not a'ree $ith the rulin' of the Commission no$ sub(ect of this appeal that an application for clearance to terminate herein complainant is mandatory on the part of respondent before terminatin' complainant7s services. @e believe that $hat $ould have been necessary $as a report as provided for under %ection !! GfH Rule L&J, 4oo- J of the Rules and Re'ulations &mplementin' the Labor Code. =oreover, even if an application for clearance $as flied, this /ffice $ould have treated the same as a report. /ther$ise, it $ould render nu'atory the 9ecision of the )rbitrator dated 9ecember 21, !"#2 in Case Nos. 2! and 218 $hich $as affirmed by the Commission, the %ecretary of Labor and the /ffice of the President of the Philippines, orderin' his temporary reinstatement, sub(ect to $hatever 9ecision the C;& of 4ulacan may promul'ate in Civil Case No. #8 6J. &t could be clearly inferred from said C;& 9ecision that if the stri-e is declared ille'al, the stri-ers $ill be considered to have lost their employment status under the then e5istin' la$s and (urisprudence, other$ise stri-ers could sta'e ille'al stri-e $ith impunity. %ince the stri-e $as declared ille'al, respondent acted in 'ood faith $hen it dispensed $ith the services of herein complainant. ;or failure of respondent to file the necessary report and based on e3uitable considerations, complainant should be 'ranted separation pay e3uivalent to one6half month salary for every year of service. @A:R:;/R:, let the decision of the National Labor Relations Commission dated November !#, !"#> be, as it is hereby, set aside and a ne$ (ud'ment is entered, orderin' respondent to 'ive complainant separation pay e3uivalent to one6half month salary for every year of service. %/ /R9:R:9. 3 Petitioner elevates to +s for revie$ on certiorari the afore3uoted /rder see-in' to persuade this Court that then )ctin' %ecretary of Labor )mado D. &ncion' committed reversible error in holdin' that, under the la$ and facts of this case, a mere report of the termination of the services of said petitioner $as sufficient. Petitioner assi'ns the follo$in' errors. & @A:,A:R /R N/, ) CL:)R)NC: ;R/= ,A: %:CR:,)RE /; L)4/R &% %,&LL N:C:%%)RE 4:;/R: ,A: P:,&,&/N:R A:R:&N C/+L9 4: 9&%=&%%:9 C/N%&9:R&ND ,A: R:%,R&C,&J: C/N9&,&/N &N ,A: 9:C&%&/N /; ,A: C/=P+L%/RE )R4&,R),/R &N NLRC C)%: N/%. 2! )N9 218. && @A:,A:R /R N/, ,A: 9:C&%&/N /; ,A: C/+R, /; ;&R%, &N%,)NC: /; 4+L)C)N &N C&J&L C)%: N/. #8 6J &P%/ ;)C,/ D)J: ,A: R:%P/N9:N, C/=P)NE )+,A/R&,E ,/ 9&%=&%% A:R:&N P:,&,&/N:R @&,A/+, )NE CL:)R)NC: ;R/= ,A: %:CR:,)RE /; L)4/R. 4 ,he substantive la$ on the matter enforced durin' the time of petitioner7s dismissal $as )rticle 2># GbH of the Labor Code Gin con(unction $ith the rules and re'ulations implementin' said substantive la$.H )rticle 2># reads. No employer that has no collective bar'ainin' a'reement may shut do$n his establishment or dismiss or terminate the service of re'ular employees $ith at least one G!H year of service e5cept mana'erial employees as defined in this boo- $ithout previous $ritten clearance from the %ecretary of Labor. Petitioner maintains that the abovecited provision is very clear. &t does not ma-e any distinction as to the 'round for dismissal. @hether or not the dismissal sou'ht by the employer company is for cause, it is imperative that the company must apply for a clearance from the %ecretary of Labor. &n a recent case 5 penned by Justice )braham ;. %armiento promul'ated on June 0 , !"1#, $e had occasion to rule in a'reement $ith the findin's of then Presidential )ssistant for Le'al )ffairs Ronaldo Kamora that the purpose in re3uirin' a prior clearance from the %ecretary of Labor in cases of shutdo$n or dismissal of employees, is to afford the %ecretary ample opportunity to e5amine and determine the reasonableness of the re3uest. ,he %olicitor Deneral, in relation to said pronouncement and in (ustification of the )ctin' Labor %ecretary7s decision ma-es the follo$in' observations. &t is true that article 2># GbH of the Labor Code re3uires that before any business establishment is shut do$n or any employee is dismissed, $ritten clearance from the %ecretary of Labor must first be obtained. &t is li-e$ise true that in the case of petitioner, there $as no $ritten clearance in the usual form. 4ut $hile there may not have been strict compliance $ith )rticle 2># there $as substantial compliance. ,he %ecretary of Labor t$ice manifested his conformity to petitioner7s dismissal.

,he first manifestation of ac3uiescence by the %ecretary of Labor to the dismissal of petitioner $as his affirmance of the decision of the arbitrator in NLRC Case Nos. 2! and 218. ,he arbitrator ordered the reinstatement of the stri-ers but sub(ect to the decision of the C;& of 4ulacan in Civil Case No. #8 6J. ,he %ecretary of Labor affirmed the decision of the arbitrator. &n effect, therefore, the %ecretary of Labor issued a carte blanc%e to the C;& of 4ulacan to either dismiss or retain petitioner. ,he second manifestation $as his decision in NLRC Case No. R46&J6!#>*6>8 $herein he said that clearance for the dismissal of petitioner $as not re3uired, but only a reportB that even if an application for clearance $as filed, he $ould have treated it as a mere report. @hile this is not 'rior clearance in the contemplation of )rticle 2>#, it is at least a ratification of the dismissal of petitioner. 6 @e a'ree $ith the %olicitor Deneral. ,echnically spea-in', no clearance $as obtained by private respondent from the then %ecretary of Labor, the last step to$ards full compliance $ith the re3uirements of la$ on the matter of dismissal of employees. Ao$ever, the rationale behind the clearance re3uirement $as fully met. ,he %ecretary of Labor $as apprised of private respondent7s intention to terminate the services of petitioner. ,his in effect is an application for clearance to dismiss petitioner from employment. ,he affirmance of the restrictive condition in the dispositive portion of the labor arbiter7s decision in NLRC Case Nos. 2! and 218 by the %ecretary of Labor and the /ffice of the President of the Philippines, si'nifies a 'rant of authority to dismiss petitioner in case the stri-e is declared ille'al by the Court of ;irst &nstance of 4ulacan. Conse3uently and as correctly stated by the %olicitor Deneral, private respondent acted in 'ood faith $hen it terminated the employment of petitioner upon a declaration of ille'ality of the stri-e by the Court of ;irst &nstance of 4ulacan. =oreover, the then %ecretary of Labor manifested his conformity to the dismissal, not once, but t$ice. &n this re'ard, the mandatory rule on clearance need not be applied. ,he stri-e sta'ed by the union in !"#2 $as a futile move. ,he la$ then enforced, Republic )ct 1#8 specifically e5cluded respondent company from its covera'e. :ven if the parties had 'one to court to compel reco'nition, no positive relief could have been obtained since the same $as not sanctioned by la$. 4ecause of this, there $as no necessity on the part of private respondent to sho$ specific acts of petitioner durin' the stri-e to (ustify his dismissal. ,his is a matter of responsibility and of ans$erability. Petitioner as a union leader, must see to it that the policies and activities of the union in the conduct of labor relations are $ithin the precepts of la$ and any deviation from the le'al boundaries shall be imputable to the leader. Ae bears the responsibility of 'uidin' the union alon' the path of la$ and to cause the union to demand $hat is not le'ally demandable, $ould foment anarchy $hich is a prelude to chaos. Petitioner should have -no$n and it $as his duty to impart this imputed -no$led'e to the members of the union that employees and laborers in non6 profit or'ani?ations are not covered by the provisions of the &ndustrial Peace )ct and the Court of &ndustrial Relations Gin the case at bar, the Court of ;irst &nstanceH has no (urisdiction to entertain petitions of labor unions or or'ani?ations of said non6profit or'ani?ations for certification as the e5clusive bar'ainin' representatives of said employees and laborers. 4 )s a stri-e is an economic $eapon at $ar $ith the policy of the Constitution and the la$ at that time, a resort thereto by laborers shall be deemed to be a choice of remedy peculiarly their o$n and outside of the statute, and as such, the stri-ers must accept all the ris-s attendant upon their choice. &f they succeed and the employer succumbs, the la$ $ill not stand in their $ay in the en(oyment of the la$ful fruits of their victory. 4ut if they fail, they cannot thereafter invo-e the protection of the la$ for the conse3uences of their conduct unless the ri'ht they $ished vindicated is one $hich the la$ $ill, by all means, protect and enforce. 8 @e further a'ree $ith the )ctin' %ecretary of Labor that $hat $as re3uired in the case of petitioner7s dismissal $as only a report as provided under %ection !! GfH of Rule L&J of the Rules and Re'ulations implementin' the Labor Code $hich provides. :very employer shall submit a report to the Re'ional /ffice in accordance $ith the form presented by the 9epartment on the follo$in' instances of termination of employment, suspension, lay6off or shutdo$n $hich may be effected by the employer $ithout prior clearance $ithin five G8H days thereafter. 555 555 555 GfH )ll other terminations of employment, suspension, lay6offs or shutdo$ns, not other$ise specified in this and in the immediately precedin' sections. ,o hold other$ise $ould render nu'atory the conditions set forth in the decision of Labor )rbiter )'uas on the basis of $hich petitioner $as temporarily reinstated. &nasmuch as there $as a valid and reasonable 'round to dismiss petitioner but no report as re3uired by the implementin' rules and re'ulations of the Labor Code $as filed by respondent Company $ith the then 9epartment of Labor, petitioner as held by the )ctin' %ecretary of Labor, is entitled to separation pay e3uivalent to one6half month salary for every year of service. @A:R:;/R:, the petition is dismissed. ,he decision of the actin' %ecretary of Labor is );;&R=:9 in toto. %/ /R9:R:9.

G.R. No. 85985 Au$u&( 13, 1993

.EL , J.:

/9ILI//INE AIRLINES, INC. 2/AL3, petitioner, vs. NA0I NAL LA1 R RELA0I NS C ..ISSI N, LA1 R AR1I0ER ISA1EL /. E./L !EES ASS CIA0I N 2/ALEA3, respondents.

R0IGUERRA an" /9ILI//INE AIRLINES

&n the instant petition for certiorari, the Court is presented the issue of $hether or not the formulation of a Code of 9iscipline amon' employees is a shared responsibility of the employer and the employees. /n =arch !8, !"18, the Philippine )irlines, &nc. (P)L) completely revised its !">> Code of 9iscipline. ,he Code $as circulated amon' the employees and $as immediately implemented, and some employees $ere forth$ith sub(ected to the disciplinary measures embodied therein. ,hus, on )u'ust 2 , !"18, the Philippine )irlines :mployees )ssociation (P)L:)) filed a complaint before the National Labor Relations Commission (NLRC) for unfair labor practice (Case No. NCR6#62 8!618) $ith the follo$in' remar-s. <+LP $ith arbitrary implementation of P)L7s Code of 9iscipline $ithout notice and prior discussion $ith +nion by =ana'ement< ( ollo, p. *!). &n its position paper, P)L:) contended that P)L, by its unilateral implementation of the Code, $as 'uilty of unfair labor practice, specifically Para'raphs : and D of )rticle 2*" and )rticle 280 of the Labor Code. P)L:) alle'ed that copies of the Code had been circulated in limited numbersB that bein' penal in nature the Code must conform $ith the re3uirements of sufficient publication, and that the Code $as arbitrary, oppressive, and pre(udicial to the ri'hts of the employees. &t prayed that implementation of the Code be held in abeyanceB that P)L should discuss the substance of the Code $ith P)L:)B that employees dismissed under the Code be reinstated and their cases sub(ected to further hearin'B and that P)L be declared 'uilty of unfair labor practice and be ordered to pay dama'es (pp. #6!*, Record.) P)L filed a motion to dismiss the complaint, assertin' its prero'ative as an employer to prescibe rules and re'ulations re'ardin' employess7 conduct in carryin' out their duties and functions, and alle'in' that by implementin' the Code, it had not violated the collective bar'ainin' a'reement (C4)) or any provision of the Labor Code. )ssailin' the complaint as unsupported by evidence, P)L maintained that )rticle 280 of the Labor Code cited by P)L:) reffered to the re3uirements for ne'otiatin' a C4) $hich $as inapplicable as indeed the current C4) had been ne'otiated. &n its reply to P)L7s position paper, P)L:) maintained that )rticle 2*" (:) of the Labor Code $as violated $hen P)L unilaterally implemented the Code, and cited provisions of )rticles &J and & of Chapter && of the Code as defective for, respectively, runnin' counter to the construction of penal la$s and ma-in' punishable any offense $ithin P)L7s contemplation. ,hese provisions are the follo$in'. %ec. 2. !on)e*clusivity. C ,his Code does not contain the entirety of the rules and re'ulations of the company. :very employee is bound to comply $ith all applicable rules, re'ulations, policies, procedures and standards, includin' standards of 3uality, productivity and behaviour, as issued and promul'ated by the company throu'h its duly authori?ed officials. )ny violations thereof shall be punishable $ith a penalty to be determined by the 'ravity andMor fre3uency of the offense. %ec. #. Cumulative ecord. C )n employee7s record of offenses shall be cumulative. ,he penalty for an offense shall be determined on the basis of his past record of offenses of any nature or the absence thereof. ,he more habitual an offender has been, the 'reater shall be the penalty for the latest offense. ,hus, an employee may be dismissed if the number of his past offenses $arrants such penalty in the (ud'ment of mana'ement even if each offense considered separately may not $arrant dismissal. Aabitual offenders or recidivists have no place in P)L. /n the other hand, due re'ard shall be 'iven to the len'th of time bet$een commission of individual offenses to determine $hether the employee7s conduct may indicate occasional lapses ($hich may nevertheless re3uire sterner disciplinary action) or a pattern of incorri'ibility. Labor )rbiter &sabel P. /rti'uerra handlin' the case called the parties to a conference but they failed to appear at the scheduled date. &nterpretin' such failure as a $aiver of the parties7 ri'ht to present evidence, the labor arbiter considered the case submitted for decision. /n November #, !"1>, a decision $as rendered findin' no bad faith on the part of P)L in adoptin' the Code and rulin' that no unfair labor practice had been committed. Ao$ever, the arbiter held that P)L $as <not totally fault free< considerin' that $hile the issuance of rules and re'ulations 'overnin' the conduct of employees is a <le'itimate mana'ement prero'ative< such rules and re'ulations must meet the test of <reasonableness, propriety and fairness.< %he found %ection ! of the Code afore3uoted as <an all embracin' and all encompassin' provision that ma-es punishable any offense one can thin- of in the company<B $hile %ection #, li-e$ise 3uoted above, is <ob(ectionable for it violates the rule a'ainst double (eopardy thereby usherin' in t$o or more punishment for the same misdemeanor.< (pp. 0160", ollo.) ,he labor arbiter also found that P)L <failed to prove that the ne$ Code $as amply circulated.< Notin' that P)L7s assertion that it had furnished all its employees copies of the Code is unsupported by documentary evidence, she stated that such <failure< on the part of P)L resulted in the imposition of penalties on employees $ho thou'ht all the $hile that the !">> Code $as still bein' follo$ed. ,hus, the arbiter concluded that <(t)he phrase i'norance of the la$ e5cuses no one from compliance . . . finds application only after it has been conclusively sho$n that the la$ $as circulated to all the parties concerned and efforts to disseminate information re'ardin' the ne$ la$ have been e5erted. (p. 0", ollo.) %he thereupon disposed.

@A:R:;/R:, premises considered, respondent P)L is hereby ordered as follo$s. !. ;urnish all employees $ith the ne$ Code of 9isciplineB 2. Reconsider the cases of employees meted $ith penalties under the Ne$ Code of 9iscipline and remand the same for further hearin'B and 0. 9iscuss $ith P)L:) the ob(ectionable provisions specifically tac-led in the body of the decision. )ll other claims of the complainant union (is) GareH hereby, dismissed for lac- of merit. %/ /R9:R:9. (p. * , ollo.)

P)L appealed to the NLRC. /n )u'ust !", !"11, the NLRC throu'h Commissioner :ncarnacion, $ith Presidin' Commissioner 4onto6 Pere? and Commissioner =a'laya concurrin', found no evidence of unfair labor practice committed by P)L and affirmed the dismissal of P)L:)7s char'e. Nonetheless, the NLRC made the follo$in' observations. &ndeed, failure of mana'ement to discuss the provisions of a contemplated code of discipline $hich shall 'overn the conduct of its employees $ould result in the erosion and deterioration of an other$ise harmonious and smooth relationship bet$een them as did happen in the instant case. ,here is no dispute that adoption of rules of conduct or discipline is a prero'ative of mana'ement and is imperative and essential if an industry, has to survive in a competitive $orld. 4ut labor climate has pro'ressed, too. &n the Philippine scene, at no time in our contemporary history is the need for a cooperative, supportive and smooth relationship bet$een labor and mana'ement more -eenly felt if $e are to survive economically. =ana'ement can no lon'er e5clude labor in the deliberation and adoption of rules and re'ulations that $ill affect them. ,he complainant union in this case has the ri'ht to feel isolated in the adoption of the Ne$ Code of 9iscipline. ,he Code of 9iscipline involves security of tenure and loss of employment C a property ri'htN &t is time that mana'ement reali?es that to attain effectiveness in its conduct rules, there should be candidness and openness by =ana'ement and participation by the union, representin' its members. &n fact, our Constitution has reco'ni?ed the principle of <shared responsibility< bet$een employers and $or-ers and has li-e$ise reco'ni?ed the ri'ht of $or-ers to participate in <policy and decision6ma-in' process affectin' their ri'hts . . .< ,he latter provision $as interpreted by the Constitutional Commissioners to mean participation in <mana'ement<7 (Record of the Constitutional Commission, Jol. &&). &n a sense, participation by the union in the adoption of the code if conduct could have accelerated and enhanced their feelin's of belon'in' and $ould have resulted in cooperation rather than resistance to the Code. &n fact, labor6 mana'ement cooperation is no$ <the thin'.< (pp. 06*, NLRC 9ecision ff. p. !*", /ri'inal Record.) Respondent Commission thereupon disposed. @A:R:;/R:, premises considered, $e modify the appealed decision in the sense that the Ne$ Code of 9iscipline should be revie$ed and discussed $ith complainant union, particularly the disputed provisions G.H (,)hereafter, respondent is directed to furnish each employee $ith a copy of the appealed Code of 9iscipline. ,he pendin' cases adverted to in the appealed decision if still in the arbitral level, should be reconsidered by the respondent Philippine )ir Lines. /ther dispositions of the Labor )rbiter are sustained. %/ /R9:R:9. (p. 8, NLRC 9ecision.) P)L then filed the instant petition for certiorari char'in' public respondents $ith 'rave abuse of discretion in. (a) directin' P)L <to share its mana'ement prero'ative of formulatin' a Code of 9iscipline<B (b) en'a'in' in 3uasi6(udicial le'islation in orderin' P)L to share said prero'ative $ith the unionB (c) decidin' beyond the issue of unfair labor practice, and (d) re3uirin' P)L to reconsider pendin' cases still in the arbitral level (p. #, PetitionB p. 1, ollo.) )s stated above, the Principal issue submitted for resolution in the instant petition is $hether mana'ement may be compelled to share $ith the union or its employees its prero'ative of formulatin' a code of discipline. P)L asserts that $hen it revised its Code on =arch !8, !"18, there $as no la$ $hich mandated the sharin' of responsibility therefor bet$een employer and employee. &ndeed, it $as only on =arch 2, !"1", $ith the approval of Republic )ct No. >#!8, amendin' )rticle 2!! of the Labor Code, that the la$ e5plicitly considered it a %tate policy <(t)o ensure the participation of $or-ers in decision and policy6ma-in' processes affectin' the ri'hts, duties and $elfare.< Ao$ever, even in the absence of said clear provision of la$, the e5ercise of mana'ement prero'atives $as never considered boundless. ,hus, in Cru+ vs. ,edina (!## %CR) 8>8 G!"1"H) it $as held that mana'ement7s prero'atives must be $ithout abuse of discretion. &n #an ,i"uel Bre-ery #ales Force Union (P$(./) vs. /'le (!# %CR) 28 G!"1"H), $e upheld the company7s ri'ht to implement a ne$ system of distributin' its products, but 'ave the follo$in' caveat.

%o lon' as a company7s mana'ement prero'atives are e5ercised in 'ood faith for the advancement of the employer7s interest and not for the purpose of defeatin' or circumventin' the ri'hts of the employees under special la$s or under valid a'reements, this Court $ill uphold them. (at p. 21.) )ll this points to the conclusion that the e5ercise of mana'erial prero'atives is not unlimited. &t is circumscribed by limitations found in la$, a collective bar'ainin' a'reement, or the 'eneral principles of fair play and (ustice (University of #to. $omas vs. !L C, !" %CR) #81 G!"" H). =oreover, as enunciated in Abbott Laboratories (P%il.)0 vs. !L C (!8* #!0 G!"1#H), it must be duly established that the prero'ative bein' invo-ed is clearly a mana'erial one. ) close scrutiny of the ob(ectionable provisions of the Code reveals that they are not purely business6oriented nor do they concern the mana'ement aspect of the business of the company as in the #an ,i"uel case. ,he provisions of the Code clearly have repercusions on the employee7s ri'ht to security of tenure. ,he implementation of the provisions may result in the deprivation of an employee7s means of livelihood $hich, as correctly pointed out by the NLRC, is a property ri'ht (Callanta0 vs Carnation P%ili''ines0 Inc., !*8 %CR) 2>1 G!"1>H). &n vie$ of these aspects of the case $hich border on infrin'ement of constitutional ri'hts, $e must uphold the constitutional re3uirements for the protection of labor and the promotion of social (ustice, for these factors, accordin' to Justice &sa'ani Cru?, tilt <the scales of (ustice $hen there is doubt, in favor of the $or-er< (&m'loyees Association of t%e P%ili''ine American Life Insurance Com'any vs. !L C, !"" %CR) >21 G!""!H >08). Jerily, a line must be dra$n bet$een mana'ement prero'atives re'ardin' business operations 'er se and those $hich affect the ri'hts of the employees. &n treatin' the latter, mana'ement should see to it that its employees are at least properly informed of its decisions or modes action. P)L asserts that all its employees have been furnished copies of the Code. Public respondents found to the contrary, $hich findin', to say the least is entitled to 'reat respect. P)L posits the vie$ that by si'nin' the !"1"6!""! collective bar'ainin' a'reement, on June 2#, !"" , P)L:) in effect, reco'ni?ed P)L7s <e5clusive ri'ht to ma-e and enforce company rules and re'ulations to carry out the functions of mana'ement -it%out havin' to discuss the same $ith P)L:) and much less, obtain the latter7sconformity t%ereto< (pp. !!6!2, Petitioner7s =emorandumB pp !1 6 !1!, ollo.) Petitioner7s vie$ is based on the follo$in' provision of the a'reement. ,he )ssociation reco'ni?es the ri'ht of the Company to determine matters of mana'ement it policy and Company operations and to direct its manpo$er. =ana'ement of the Company includes the ri'ht to or'ani?e, plan, direct and control operations, to hire, assi'n employees to $or-, transfer employees from one department, to another, to promote, demote, discipline, suspend or dischar'e employees for (ust causeB to lay6off employees for valid and le'al causes, to introduce ne$ or improved methods or facilities or to chan'e e5istin' methods or facilities and the ri'ht to ma-e and enforce Company rules and re'ulations to carry out the functions of mana'ement. ,he e5ercise by mana'ement of its prero'ative shall be done in a (ust reasonable, humane andMor la$ful manner. %uch provision in the collective bar'ainin' a'reement may not be interpreted as cession of employees7 ri'hts to participate in the deliberation of matters $hich may affect their ri'hts and the formulation of policies relative thereto. )nd one such mater is the formulation of a code of discipline. &ndeed, industrial peace cannot be achieved if the employees are denied their (ust participation in the discussion of matters affectin' their ri'hts. ,hus, even before )rticle 2!! of the labor Code (P.9. **2) $as amended by Republic )ct No. >#!8, it $as already declared a policy of the %tate, <(d) ,o promote the enli'htenment of $or-ers concernin' their ri'hts and obli'ations . . . as employees.< ,his $as, of course, amplified by Republic )ct No >#!8 $hen it decreed the <participation of $or-ers in decision and policy ma-in' processes affectin' their ri'hts, duties and $elfare.< P)L7s position that it cannot be saddled $ith the <obli'ation< of sharin' mana'ement prero'atives as durin' the formulation of the Code, Republic )ct No. >#!8 had not yet been enacted (Petitioner7s =emorandum, p. **B ollo, p. 2!2), cannot thus be sustained. @hile such <obli'ation< $as not yet founded in la$ $hen the Code $as formulated, the attainment of a harmonious labor6mana'ement relationship and the then already e5istin' state policy of enli'htenin' $or-ers concernin' their ri'hts as employees demand no less than the observance of transparency in mana'erial moves affectin' employees7 ri'hts. Petitioner7s assertion that it needed the implementation of a ne$ Code of 9iscipline considerin' the nature of its business cannot be overemphasi?ed. &n fact, its bein' a local monopoly in the business demands the most strin'ent of measures to attain safe travel for its patrons. Nonetheless, $hatever disciplinary measures are adopted cannot be properly implemented in the absence of full cooperation of the employees. %uch cooperation cannot be attained if the employees are restive on account, of their bein' left out in the determination of cardinal and fundamental matters affectin' their employment. @A:R:;/R:, the petition is 9&%=&%%:9 and the 3uestioned decision );;&R=:9. No special pronouncement is made as to costs. %/ /R9:R:9. G.R. No. 124598 ;'%ruary 22, 2555 !NARES-SAN0IAG , J.:

.ANILA ELEC0RIC C ./AN!, petitioner, vs. 9on. SECRE0AR! ; LA1 R LE NARE./L !EES an" , RKERS ASS CIA0I N 2.E,A3, respondent. &n the 9ecision promul'ated on January 2#, !""", the Court disposed of the case as follo$s.

<UISU.1ING an" .ERALC

@A:R:;/R:, the petition is 'ranted and the orders of public respondent %ecretary of Labor dated )u'ust !", !""> and 9ecember 21, !""> are set aside to the e5tent set forth above. ,he parties are directed to e5ecute a Collective 4ar'ainin' )'reement incorporatin' the terms and conditions contained in the unaffected portions of the %ecretary of Labor7s orders of )u'ust !", !""> and 9ecember 21, !"">, and the modifications set forth above. ,he retirement fund issue is remanded to the %ecretary of Labor for reception of evidence and determination of the le'al personality of the =:R)LC/ retirement fund.!

The modifications of the public respondent's resolutions include the following:

1anuary 230 4555 decision @a'es L7mas bonus Retirees Loan to coops DA%&P, A=P and Aousin' loans %i'nin' bonus +nion leave Ai'h volta'eMpole Collectors C4+ +nion security Contractin' out )ll benefits Retroactivity 6 6 6 6 6 6 6 6 6 6 6 6 6 6 P!," . for !""86"> #ecretary6s resolution P2,2 .

modified to one month remanded to the %ecretary denied 'ranted up to P> , denied * days (typo error) not apply to those $ho are not e5posed to the risno need for cash bond, no need to reduce 3uota and =)PL e5clude confidential employees maintenance of membership no need to consult union e5istin' terms and conditions 9ec. 21, !"">69ec. 2#, !""(") .

2 months 'ranted 'ranted 'ranted 'ranted 0 days members of a team

include closed shop consult first all terms from 9ec. !, !""8

9issatisfied $ith the 9ecision, some alle'ed members of private respondent union (+nion for brevity) filed a motion for intervention and a motion for reconsideration of the said 9ecision. ) separate intervention $as li-e$ise made by the supervisor7s union (;L)=:%2) of petitioner corporation alle'in' that it has bona fide le'al interest in the outcome of the case.0 ,he Court re3uired the <proper parties< to file a comment to the three motions for reconsideration but the %olicitor6Deneral as-ed that he be e5cused from filin' the comment because the <petition filed in the instant case $as 'ranted< by the Court.* Conse3uently, petitioner filed its o$n consolidated comment. )n <)ppeal %ee-in' &mmediate Reconsideration< $as also filed by the alle'ed ne$ly elected president of the +nion.8 /ther subse3uent pleadin's $ere filed by the parties and intervenors. ,he issues raised in the motions for reconsideration had already been passed upon by the Court in the January 2#, !""" decision. No ne$ ar'uments $ere presented for consideration of the Court. Nonetheless, certain matters $ill be considered herein, particularly those involvin' the amount of $a'es and the retroactivity of the Collective 4ar'ainin' )'reement (C4)) arbitral a$ards. Petitioner $arns that if the $a'e increase of P2,2 . per month as ordered by the %ecretary is allo$ed, it $ould simply pass the cost coverin' such increase to the consumers throu'h an increase in the rate of electricity. ,his is a non se7uitur. ,he Court cannot be threatened $ith such a misleadin' ar'ument. )n increase in the prices of electric current needs the approval of the appropriate re'ulatory 'overnment a'ency and does not automatically result from a mere increase in the $a'es of petitioner7s employees. 4esides, this ar'ument presupposes that petitioner is capable of meetin' a $a'e increase. ,he )ll )sia Capital report upon $hich the +nion relies to support its position re'ardin' the $a'e issue cannot be an accurate basis and conclusive determinant of the rate of $a'e increase. %ection *8 of Rule !0 Rules of :vidence provides. Commercial lists and t%e li8e. C :vidence of statements of matters of interest to persons en'a'ed in an occupation contained in a list, re'ister, periodical, or other published compilation is admissible as tendin' to prove the truth of any relevant matter so

stated if that compilation is published for use by persons en'a'ed in that occupation and is 'enerally used and relied upon by them therein. +nder the afore63uoted rule, statement of matters contained in a periodical, may be admitted only <if that compilation is published for use by persons en'a'ed in that occupation and is 'enerally used and relied upon by them therein.< )s correctly held in our 9ecision dated January 2#, !""", the cited report is a mere ne$spaper account and not even a commercial list. )t most, it is but an analysis or opinion $hich carries no persuasive $ei'ht for purposes of this case as no sufficient fi'ures to support it $ere presented. Neither did anybody testify to its accuracy. &t cannot be said that businessmen 'enerally rely on ne$s items such as this in their occupation. 4esides, no evidence $as presented that the publication $as re'ularly prepared by a person in touch $ith the mar-et and that it is 'enerally re'arded as trust$orthy and reliable. )bsent e5trinsic proof of their accuracy, these reports are not admissible.> &n the same manner, ne$spapers containin' stoc- 3uotations are not admissible in evidence $hen the source of the reports is available.# @ith more reason, mere analyses or pro(ections of such reports cannot be admitted. &n particular, the source of the report in this case can be easily made available considerin' that the same is necessary for compliance $ith certain 'overnmental re3uirements. Nonetheless, by petitioner7s o$n alle'ations, its actual total net income for !""> $as P8.! billion.1 )n estimate by the )ll )sia financial analyst stated that petitioner7s net operatin' income for the same year $as about P8.# billion, a fi'ure $hich the +nion relies on to support its claim. )ssumin' $ithout admittin' the truth thereof, the fi'ure is hi'her than the P*.!#! billion alle'edly su''ested by petitioner as its pro(ected net operatin' income. ,he P8.# billion $hich $as the %ecretary7s basis for 'rantin' the P2,2 . is hi'her than the actual net income of P8.! billion admitted by petitioner. &t $ould be proper then to increase this Court7s a$ard of P!," . to P2, . for the t$o years of the C4) a$ard. ;or !""2, the a'reed C4) $a'e increase for ran-6and6file $as P!,* . and $as reduced to P!,08 . B for !""0B further reduced to P!,!8 . for !""*. ;or supervisory employees, the a'reed $a'e increase for the years !""26!""* are P!,#*2.8 , P!,>12.8 and P!,**2.8 , respectively. 4ased on the fore'oin' fi'ures, the P2, . increase for the t$o6year period a$arded to the ran-6and6file is much hi'her than the hi'hest increase 'ranted to supervisory employees." )s mentioned in the January 2#, !""" 9ecision, the Court does <not see- to enumerate in this decision the factors that should affect $a'e determination< because collective bar'ainin' disputes particularly those affectin' the national interest and public service <re3uires due consideration and proper balancin' of the interests of the parties to the dispute and of those $ho mi'ht be affected by the dispute.<! ,he Court ta-es (udicial notice that the ne$ amounts 'ranted herein are si'nificantly hi'her than the $ei'hted avera'e salary currently en(oyed by other ran-6and6file employees $ithin the community. &t should be noted that the relations bet$een labor and capital is impressed $ith public interest $hich must yield to the common 'ood.!! Neither party should act oppressively a'ainst the other or impair the interest or convenience of the public.!2 4esides, matters of salary increases are part of mana'ement prero'ative.!0 /n the retroactivity of the C4) arbitral a$ard, it is $ell to recall that this petition had its ori'in in the rene'otiation of the parties7 !""26 !""# C4) insofar as the last t$o6year period thereof is concerned. @hen the %ecretary of Labor assumed (urisdiction and 'ranted the arbitral a$ards, there $as no 3uestion that these arbitral a$ards $ere to be 'iven retroactive effect. Ao$ever, the parties dispute the rec-onin' period $hen retroaction shall commence. Petitioner claims that the a$ard should retroact only from such time that the %ecretary of Labor rendered the a$ard, invo-in' the !""8 decision in Pier 1 case!* $here the Court, citin' Union of Fili'ino &m'loyees v. !L C,!8said. ,he assailed resolution $hich incorporated the C4) to be si'ned by the parties $as promul'ated on June 8, !"1", the e5piry date of the past C4). 4ased on the provision of %ection 2806), its retroactivity should be a'reed upon by the parties. 4ut since no a'reement to that effect $as made, public respondent did not abuse its discretion in 'ivin' the said C4) a prospective effect. ,he action of the public respondent is $ithin the ambit of its authority vested by e5istin' la$. /n the other hand, the +nion ar'ues that the a$ard should retroact to such time 'ranted by the %ecretary, citin' the !""0 decision of %t. Lu-e7s.!> ;inally, the effectivity of the /rder of January 21, !""!, must retroact to the date of the e5piration of the previous C4), contrary to the position of petitioner. +nder the circumstances of the case, )rticle 2806) cannot be properly applied to herein case. )s correctly stated by public respondent in his assailed /rder of )pril !2, !""! dismissin' petitioner7s =otion for Reconsideration C )nent the alle'ed lac- of basis for the retroactivity provisions a$ardedB $e $ould stress that the provision of la$ invo-ed by the Aospital, )rticle 2806) of the Labor Code, spea-s of a'reements by and bet$een the parties, and not arbitral a$ards . . . ,herefore, in the absence of a specific provision of la$ prohibitin' retroactivity of the effectivity of arbitral a$ards issued by the %ecretary of Labor pursuant to )rticle 2>0(') of the Labor Code, such as herein involved, public respondent is deemed vested $ith plenary and discretionary po$ers to determine the effectivity thereof. &n the !""# case of =indanao ,erminal,!# the Court applied the %t. Lu-e7s doctrine and ruled that. &n #t. Lu8e6s ,edical Center v. $orres, a deadloc- also developed durin' the C4) ne'otiations bet$een mana'ement and the union. ,he %ecretary of Labor assumed (urisdiction and ordered the retroaction of the C4) to the date of e5piration of the previous C4). )s in this case, it $as alle'ed that the %ecretary of Labor 'ravely abused its discretion in ma-in' his a$ard retroactive. &n dismissin' this contention this Court held.

,herefore, in the absence of a specific provision of la$ prohibitin' retroactive of the effectivity of arbitral a$ards issued by the %ecretary of Labor pursuant to )rticle 2>0(') of the Labor Code, such as herein involved, public respondent is deemed vested $ith plenary and discretionary po$ers to determine the effectivity thereof. ,he Court in the January 2#, !""" 9ecision, stated that the C4) shall be <effective for a period of 2 years counted from 9ecember 21, !""> up to 9ecember 2#, !""".< Parenthetically, this actually covers a three6year period. Labor la$s are silent as to $hen an arbitral a$ard in a labor dispute $here the %ecretary had assumed (urisdiction by virtue of )rticle 2>0 (') of the Labor Code shall retroact. &n 'eneral, a C4) ne'otiated $ithin si5 months after the e5piration of the e5istin' C4) retroacts to the day immediately follo$in' such date and if a'reed thereafter, the effectivity depends on the a'reement of the parties.!1 /n the other hand, the la$ is silent as to the retroactivity of a C4) arbitral a$ard or that 'ranted not by virtue of the mutual a'reement of the parties but by intervention of the 'overnment. 9espite the silence of the la$, the Court rules herein that C4) arbitral a$ards 'ranted after si5 months from the e5piration of the last C4) shall retroact to such time a'reed upon by both employer and the employees or their union. )bsent such an a'reement as to retroactivity, the a$ard shall retroact to the first day after the si56month period follo$in' the e5piration of the last day of the C4) should there be one. &n the absence of a C4), the %ecretary7s determination of the date of retroactivity as part of his discretionary po$ers over arbitral a$ards shall control. &t is true that an arbitral a$ard cannot 'er se be cate'ori?ed as an a'reement voluntarily entered into by the parties because it re3uires the interference and imposin' po$er of the %tate thru the %ecretary of Labor $hen he assumes (urisdiction. Ao$ever, the arbitral a$ard can be considered as an appro5imation of a collective bar'ainin' a'reement $hich $ould other$ise have been entered into by the parties.!" ,he terms or periods set forth in )rticle 2806) pertains e5plicitly to a C4). 4ut there is nothin' that $ould prevent its application by analo'y to an arbitral a$ard by the %ecretary considerin' the absence of an applicable la$. +nder )rticle 2806). <(&)f any such a'reement is entered into beyond si5 months, the parties shall a'ree on the duration of retroactivity thereof.< &n other $ords, the la$ contemplates retroactivity $hether the a'reement be entered into before or after the said si56month period. ,he a'reement of the parties need not be cate'orically stated for their acts may be considered in determinin' the duration of retroactivity. &n this connection, the Court considers the letter of petitioner7s Chairman of the 4oard and its President addressed to their stoc-holders, $hich states that the C4) <for the ran-6and6file employees coverin' the period 9ecember !, !""8 to November 0 , !""# is still $ith the %upreme Court,<2 as indicative of petitioner7s reco'nition that the C4) a$ard covers the said period. :arlier, petitioner7s ne'otiatin' panel transmitted to the +nion a copy of its proposed C4) coverin' the same period inclusive.2! &n addition, petitioner does not dispute the alle'ation that in the past C4) arbitral a$ards, the %ecretary 'ranted retroactivity commencin' from the period immediately follo$in' the last day of the e5pired C4). ,hus, by petitioner7s o$n actions, the Court sees no reason to retroact the sub(ect C4) a$ards to a different date. ,he period is herein set at t$o (2) years from 9ecember !, !""8 to November 0 , !""#. /n the alle'ation concernin' the 'rant of loan to a cooperative, there is no merit in the union7s claim that it is no different from housin' loans 'ranted by the employer. ,he a$ard of loans for housin' is (ustified because it pertains to a basic necessity of life. &t is part of a privile'e reco'ni?ed by the employer and allo$ed by la$. &n contrast, providin' seed money for the establishment of the employee7s cooperative is a matter in $hich the employer has no business interest or le'al obli'ation. Courts should not be utili?ed as a tool to compel any person to 'rant loans to another nor to force parties to underta-e an obli'ation $ithout (ustification. /n the contrary, it is the 'overnment that has the obli'ation to render financial assistance to cooperatives and the Cooperative Code does not ma-e it an obli'ation of the employer or any private individual.22 )nent the * 6day union leave, the Court finds that the same is a typo'raphical error. &n order to avoid any confusion, it is herein declared that the union leave is only thirty (0 ) days as 'ranted by the %ecretary of Labor and affirmed in the 9ecision of this Court. ,he added re3uirement of consultation imposed by the %ecretary in cases of contractin' out for si5 (>) months or more has been re(ected by the Court. %uffice it to say that the employer is allo$ed to contract out services for si5 months or more. Ao$ever, a line must be dra$n bet$een mana'ement prero'atives re'ardin' business operations 'er se and those $hich affect the ri'hts of employees, and in treatin' the latter, the employer should see to it that its employees are at least properly informed of its decision or modes of action in order to attain a harmonious labor6mana'ement relationship and enli'hten the $or-ers concernin' their ri'hts.20 Airin' of $or-ers is $ithin the employer7s inherent freedom to re'ulate and is a valid e5ercise of its mana'ement prero'ative sub(ect only to special la$s and a'reements on the matter and the fair standards of (ustice.2* ,he mana'ement cannot be denied the faculty of promotin' efficiency and attainin' economy by a study of $hat units are essential for its operation. &t has the ultimate determination of $hether services should be performed by its personnel or contracted to outside a'encies. @hile there should be mutual consultation, eventually deference is to be paid to $hat mana'ement decides.28 Contractin' out of services is an e5ercise of business (ud'ment or mana'ement prero'ative.2> )bsent proof that mana'ement acted in a malicious or arbitrary manner, the Court $ill not interfere $ith the e5ercise of (ud'ment by an employer.2# )s mentioned in the January 2#, !""" 9ecision, the la$ already sufficiently re'ulates this matter.21 Jurisprudence also provides ade3uate limitations, such that the employer must be motivated by 'ood faith and the contractin' out should not be resorted to circumvent the la$ or must not have been the result of malicious or arbitrary actions.2" ,hese are matters that may be cate'orically determined only $hen an actual suit on the matter arises. @A:R:;/R:, the motion for reconsideration is P)R,&)LLE DR)N,:9 and the assailed 9ecision is =/9&;&:9 as follo$s. (!) the arbitral a$ard shall retroact from 9ecember !, !""8 to November 0 , !""#B and (2) the a$ard of $a'e is increased from the ori'inal amount of /ne ,housand Nine Aundred Pesos (P!," . ) to ,$o ,housand Pesos (P2, . ) for the years !""8 and !"">. ,his Resolution is sub(ect to the monetary advances 'ranted by petitioner to its ran-6and6file employees durin' the pendency of this case assumin' such advances had actually been distributed to them. ,he assailed 9ecision is );;&R=:9 in all other respects. %/ /R9:R:9.

0)' G'n'ra+ 1an=#n$ La> o? 2555 or RA 8491 S'6(#on 22. #tri8es and Loc8outs. 6 ,he ban-in' industry is hereby declared as indispensable to the national interest and, not$ithstandin' the provisions of any la$ to the contrary, any stri-e or loc-out involvin' ban-s, if unsettled after seven (#) calendar days shall be reported by the 4an'-o %entral to the secretary of Labor $ho may assume (urisdiction over the dispute or decide it or certify the sane to the National Labor Relations Commission for compulsory arbitration. Ao$ever, the President of the Philippines may at any time intervene and assume (urisdiction over such labor dispute in order to settle or terminate the same. (>6:) G.R. No. L-21248 -'6'*%'r 24, 1966 7AL-IVAR, J.:

;EA0I UNIVERSI0!, petitioner, vs. 9 N. J SE S. 1AU0IS0A, /r'&#"#n$ Ju"$' o? ()' Cour( o? In"u&(r#a+ R'+a(#on& an" ;EA0I UNIVERSI0! ;ACUL0! CLU1-/A;LU, respondents. 6666666666666666666666666666666666666666 G.R. No. L-21462 -'6'*%'r 24, 1966

;EA0I UNIVERSI0!, petitioner6appellant, vs. ;EA0I UNIVERSI0! ;ACUL0! CLU1-/A;LU, respondent6appellee. 6666666666666666666666666666666666666666 G.R. No. L-21555 -'6'*%'r 24, 1966

;EA0I UNIVERSI0!, petitioner6appellant, vs. ;EA0I UNIVERSI0! ;ACUL0! CLU1-/A;LU, respondent6appellee. ,his Court, by resolution, ordered that these three cases be considered to'ether, and the parties $ere allo$ed to file only one brief for the three cases. /n January !*, !">0, the President of the respondent ;eati +niversity ;aculty Club6P);L+ C hereinafter referred to as ;aculty Club C $rote a letter to =rs. Jictoria L. )raneta, President of petitioner ;eati +niversity C hereinafter referred to as +niversity C informin' her of the or'ani?ation of the ;aculty Club into a re'istered labor union. ,he ;aculty Club is composed of members $ho are professors andMor instructors of the +niversity. /n January 22, !">0, the President of the ;aculty Club sent another letter containin' t$enty6si5 demands that have connection $ith the employment of the members of the ;aculty Club by the +niversity, and re3uestin' an ans$er $ithin ten days from receipt thereof. ,he President of the +niversity ans$ered the t$o letters, re3uestin' that she be 'iven at least thirty days to study thorou'hly the different phases of the demands. =ean$hile counsel for the +niversity, to $hom the demands $ere referred, $rote a letter to the President of the ;aculty Club demandin' proof of its ma(ority status and desi'nation as a bar'ainin' representative. /n ;ebruary !, !">0, the President of the ;aculty Club a'ain $rote the President of the +niversity re(ectin' the latter7s re3uest for e5tension of time, and on the same day he filed a notice of stri-e $ith the 4ureau of Labor alle'in' as reason therefor the refusal of the +niversity to bar'ain collectively. ,he parties $ere called to conferences at the Conciliation 9ivision of the 4ureau of Labor but efforts to conciliate them failed. /n ;ebruary !1, !">0, the members of the ;aculty Club declared a stri-e and established pic-et lines in the premises of the +niversity, resultin' in the disruption of classes in the +niversity. 9espite further efforts of the officials from the 9epartment of Labor to effect a settlement of the differences bet$een the mana'ement of the +niversity and the stri-in' faculty members no satisfactory a'reement $as arrived at. /n =arch 2!, !">0, the President of the Philippines certified to the Court of &ndustrial Relations the dispute bet$een the mana'ement of the +niversity and the ;aculty Club pursuant to the provisions of %ection ! of Republic )ct No. 1#8. &n connection $ith the dispute bet$een the +niversity and the ;aculty Club and certain incidents related to said dispute, various cases $ere filed $ith the Court of &ndustrial Relations C hereinafter referred to as C&R. ,he three cases no$ before this Court stemmed from those cases that $ere filed $ith the C&R. CA#& !/. (. . !/. L)24239 /n =ay ! , !">0, the +niversity filed before this Court a <petition for certiorari and prohibition $ith $rit of preliminary in(unction<, doc-eted as D.R. No. L62!2#1, prayin'. (!) for the issuance of the $rit of preliminary in(unction en(oinin' respondent Jud'e Jose %. 4autista of the C&R to desist from proceedin' in C&R Cases Nos. *!6&P), !!106=C, and J60 B (2) that the proceedin's in Cases Nos. *!6&P) and !!106=C be annulledB (0) that the orders dated =arch 0 , !">0 and )pril >, !">0 in Case No. *!6&P), the order dated )pril >, !">0 in Case No. !!106=C, and the order dated )pril 2", !">0 in Case No. J60 , all be annulledB and (*) that the respondent Jud'e be ordered to dismiss said cases Nos. *!6&P), !!106=C and J60 of the C&R. /n =ay ! , !">0, this Court issued a $rit of preliminary in(unction, upon the +niversity7s filin' a bond of P!, . , orderin' respondent Jud'e Jose %. 4autista as Presidin' Jud'e of the C&R, until further order from this Court, <to desist and refrain from further proceedin' in the premises (Cases Nos. *!6&P), !!106=C and J60 of the Court of &ndustrial Relations).<! /n 9ecember *, !">0, this Court ordered the in(unction bond increased to P! , . B but on January 20, !">*, upon a motion for reconsideration by the +niversity, this Court reduced the bond to P8 , . .

) brief statement of the three cases C C&R Cases *!6&P), !!106=C and J60 C involved in the Case D.R. No. L62!2#1, is here necessary. CI Case !o. :4)IPA, relates to the case in connection $ith the stri-e sta'ed by the members of the ;aculty Club. )s $e have stated, the dispute bet$een the +niversity and the ;aculty Club $as certified on =arch 2!, !">0 by the President of the Philippines to the C&R. /n the stren'th of the presidential certification, respondent Jud'e 4autista set the case for hearin' on =arch 20, !">0. 9urin' the hearin', the Jud'e endeavored to reconcile the part and it $as a'reed upon that the stri-in' faculty members $ould return to $or- and the +niversity $ould readmit them under a status 7uo arran'ement. /n that very same day, ho$ever, the +niversity, thru counsel filed a motion to dismiss the case upon the 'round that the C&R has no (urisdiction over the case, because (!) the &ndustrial Peace )ct is not applicable to the +niversity, it bein' an educational institution, nor to the members of the ;aculty Club, they bein' independent contractorsB and (2) the presidential certification is violative of %ection ! of the &ndustrial Peace )ct, as the +niversity is not an industrial establishment and there $as no industrial dispute $hich could be certified to the C&R. /n =arch 0 , !">0 the respondent Jud'e issued an order denyin' the motion to dismiss and declarin' that the &ndustrial Peace )ct is applicable to both parties in the case and that the C&R had ac3uired (urisdiction over the case by virtue of the presidential certification. &n the same order, the respondent Jud'e, believin' that the dispute could not be decided promptly, ordered the stri-ers to return immediately to $or- and the +niversity to ta-e them bac- under the last terms and conditions e5istin' before the dispute arose, as per a'reement had durin' the hearin' on =arch 20, !">0B and li-e$ise en(oined the +niversity, pendin' ad(udication of the case, from dismissin' any employee or laborer $ithout previous authori?ation from the C&R. ,he +niversity filed on )pril !, !">0 a motion for reconsideration of the order of =arch 0 , !">0 by the C&Ren banc, and at the same time as-in' that the motion for reconsideration be first heard by the C&R en banc. @ithout the motion for reconsideration havin' been acted upon by the C&R en banc, respondent Jud'e set the case for hearin' on the merits for =ay 1, !">0. ,he +niversity moved for the cancellation of said hearin' upon the 'round that the court en banc should first hear the motion for reconsideration and resolve the issues raised therein before the case is heard on the merits. ,his motion for cancellation of the hearin' $as denied. ,he respondent Jud'e, ho$ever, cancelled the scheduled hearin' $hen counsel for the +niversity manifested that he $ould ta-e up before the %upreme Court, by a petition for certiorari, the matter re'ardin' the actuations of the respondent Jud'e and the issues raised in the motion for reconsideration, specially the issue relatin' to the (urisdiction of the C&R. ,he order of =arch 0 , !">0 in Case *!6&P) is one of the orders sou'ht to be annulled in the case, D.R. No. L62!2#1. 4efore the above6mentioned order of =arch 0 , !">0 $as issued by respondent Jud'e, the +niversity had employed professors andMor instructors to ta-e the places of those professors andMor instructors $ho had struc-. /n )pril !, !">0, the ;aculty Club filed $ith the C&R in Case *!6&P) a petition to declare in contempt of court certain parties, alle'in' that the +niversity refused to accept bac- to $or- the returnin' stri-ers, in violation of the return6to6$or- order of =arch 0 , !">0. ,he +niversity filed, on )pril 8,!">0, its opposition to the petition for contempt, denyin' the alle'ations of the ;aculty Club and alle'in' by $ay of special defense that there $as still the motion for reconsideration of the order of =arch 0 , !">0 $hich had not yet been acted upon by the C&R en banc. /n )pril >, !">0, the respondent Jud'e issued an order statin' that <said replacements are hereby $arned and cautioned, for the time bein', not to disturb nor in any manner commit any act tendin' to disrupt the effectivity of the order of =arch 0 ,!">0, pendin' the final resolution of the same.<2 /n )pril 1, !">0, there placin' professors andMor instructors concerned filed, thru counsel, a motion for reconsideration by the C&R en banc of the order of respondent Jud'e of )pril >, !">0. ,his order of )pril >, !">0 is one of the orders that are sou'ht to be annulled in case D.R. No. L62!2#1. CI Case !o. 449;),C relates to a petition for certification election filed by the ;aculty Club on =arch 1, !">0 before the C&R, prayin' that it be certified as the sole and e5clusive bar'ainin' representative of all the employees of the +niversity. ,he +niversity filed an opposition to the petition for certification election and at the same time a motion to dismiss said petition, raisin' the very same issues raised in Case No. *!6&P), claimin' that the petition did not comply $ith the rules promul'ated by the C&RB that the ;aculty Club is not a le'itimate labor unionB that the members of the ;aculty Club cannot unioni?e for collective bar'ainin' purposesB that the terms of the individual contracts of the professors, instructors, and teachers, $ho are members of the ;aculty Club, $ould e5pire on =arch 28 or 0!, !">0B and that the C&R has no (urisdiction to ta-e co'ni?ance of the petition because the &ndustrial Peace )ct is not applicable to the members of the ;aculty Club nor to the +niversity. ,his case $as assi'ned to Jud'e 4alta?ar Jillanueva of the C&R. 4efore Jud'e Jillanueva could act on the motion to dismiss, ho$ever, the ;aculty Club filed on )pril 0, !">0 a motion to $ithdra$ the petition on the 'round that the labor dispute (Case No. *!6&P)) had already been certified by the President to the C&R and the issues raised in Case No. !!106=C $ere absorbed by Case No. *!6&P). ,he +niversity opposed the $ithdra$al, alle'in' that the issues raised in Case No. !!106=C $ere separate and distinct from the issues raised in Case No. *!6&P)B that the 3uestions of reco'nition and ma(ority status in Case No. !!106=C $ere not absorbed by Case No. *!6&P)B and that the C&R could not e5ercise its po$er of compulsory arbitration unless the le'al issue re'ardin' the e5istence of employer6employee relationship $as first resolved. ,he +niversity prayed that the motion of the ;aculty Club to $ithdra$ the petition for certification election be denied, and that its motion to dismiss the petition be heard. Jud'e 4alta?ar Jillanueva, findin' that the reasons stated by the ;aculty Club in the motion to $ithdra$ $ere $ell ta-en, on )pril >, !">0, issued an order 'rantin' the $ithdra$al. ,he +niversity filed, on )pril 2*, !">0, a motion for reconsideration of that order of )pril >, !">0 by the C&R en banc. ,his order of )pril >, !">0 in Case No. !!106=C is one of the orders sou'ht to be annulled in the case, D.R. No. L62!2#1, no$ before +s. CI Case !o. <);= relates to a complaint for indirect contempt of court filed a'ainst the administrative officials of the +niversity. ,he ;aculty Club, throu'h the )ctin' Chief Prosecutor of the C&R, filed $ith the C&R a complaint doc-eted as Case No. J60 , char'in' President Jictoria L. )raneta, 9ean 9aniel %alcedo, :5ecutive Jice6President Rodolfo =aslo', and )ssistant to the President Jose %e'ovia, as officials of the +niversity, $ith indirect contempt of court, reiteratin' the same char'es filed in Case No. *!6&P) for alle'ed violation of the order dated =arch 0 , !">0. 4ased on the complaint thus filed by the )ctin' Chief Prosecutor of the C&R, respondent Jud'e 4autista issued on )pril 2", !">0 an order commandin' any officer of the la$ to arrest the above named officials of the +niversity so that they may be dealt $ith in accordance $ith la$, and the same time fi5ed the bond for their release at P8 . each. ,his order of )pril 2", !">0 is also one of the orders sou'ht to be annulled in the case, D.R. No. L62l2#1.

,he principal alle'ation of the +niversity in its petition for certiorari and prohibition $ith preliminary in(unction in Case D.R. No. L62!2#1, no$ before +s, is that respondent Jud'e Jose %. 4autista acted $ithout, or in e5cess of, (urisdiction, or $ith 'rave abuse of discretion, in ta-in' co'ni?ance of, and in issuin' the 3uestioned orders in, C&R Cases Nos. *!6&P) !!106=C and J60 . Let it be noted that $hen the petition for certiorari and prohibition $ith preliminary in(unction $as filed on =ay ! , !">0 in this case, the 3uestioned order in C&R Cases Nos. *!6&P), !!106=C and J60 $ere still pendin' action by the C&R en banc upon motions for reconsideration filed by the +niversity. /n June ! , !">0, the ;aculty Club filed its ans$er to the petition for certiorari and prohibition $ith preliminary in(unction, admittin' some alle'ations contained in the petition and denyin' others, and alle'in' special defenses $hich boil do$n to the contentions that (!) the C&R had ac3uired (urisdiction to ta-e co'ni?ance of Case No. *!6&P) by virtue of the presidential certification, so that it had (urisdiction to issue the 3uestioned orders in said Case No. *!6&P)B (2) that the &ndustrial Peace )ct (Republic )ct 1#8) is applicable to the +niversity as an employer and to the members of the ;aculty Club as employees $ho are affiliated $ith a duly re'istered labor union, so that the Court of &ndustrial Relations had (urisdiction to ta-e co'ni?ance of Cases Nos. !!106=C and J60 and to issue the 3uestioned orders in those t$o casesB and (0) that the petition for certiorari and prohibition $ith preliminary in(unction $as prematurely filed because the orders of the C&R sou'ht to be annulled $ere still the sub(ects of pendin' motions for reconsideration before the C&R en banc $hen said petition for certiorari and prohibition $ith preliminary in(unction $as filed before this Court. CA#& (. . !/. L)24:>2 ,his case, D.R. No. L62!*>2, involves also C&R Case No. !!106=C. )s already stated Case No. !!106=C relates to a petition for certification election filed by the ;aculty Club as a labor union, prayin' that it be certified as the sole and e5clusive bar'ainin' representative of all employees of the +niversity. ,his petition $as opposed by the +niversity, and at the same time it filed a motion to dismiss said petition. 4ut before Jud'e 4alta?ar Jillanueva could act on the petition for certification election and the motion to dismiss the same, ;aculty Club filed a motion to $ithdra$ said petition upon the 'round that the issue raised in Case No. !!106=C $ere absorbed by Case No. *!6&P) $hich $as certified by the President of the Philippines. Jud'e 4alta?ar Jillanueva, by order )pril >, !">0, 'ranted the motion to $ithdra$. ,he +niversity filed a motion for reconsideration of that order of )pril >, !">0 by the C&R en banc. ,hat motion for reconsideration $as pendin' action by the C&R en banc $hen the petition forcertiorari and prohibition $ith preliminary in(unction in Case D.R. no. L62!2#1 $as filed on =ay ! , !">0. )s earlier stated this Court, in Case D.R. No. L62!2#1, issued a $rit of preliminary in(unction on =ay ! , !">0, orderin' respondent Jud'e 4autista, until further order from this Court, to desist and refrain from further proceedin' in the premises (Cases Nos. *!6&P), !!106=C and J60 of the Court of &ndustrial Relations). /n June 8, !">0, that is, after this Court has issued the $rit of preliminary in(unction in Case D.R. No. L62!2#1, the C&R en banc issued a resolution denyin' the motion for reconsideration of the order of )pril >, !">0 in Case No. !!106=C. /n July 1, !">0, the +niversity filed before this Court a petition for certiorari, by $ay of an appeal from the resolution of the C&R en banc, dated June 8, !">0, denyin' the motion for reconsideration of the order of )pril >, !">0 in Case No. !!106=C. ,his petition $as doc-eted as D.R. No. L62!*>2. &n its petition for certiorari, the +niversity alle'es (!) that the resolution of the Court of &ndustrial Relations of June 8, !">0 $as null and void because it $as issued in violation of the $rit of preliminary in(unction issued in Case D.R. No. L62!2#1B (2) that the issues of employer6employee relationship, the alle'ed status as a labor union, ma(ority representation and desi'nation as bar'ainin' representative in an appropriate unit of the ;aculty Club should have been resolved first in Case No. !!106 =C prior to the determination of the issues in Case No. *!6&P) and therefore the motion to $ithdra$ the petition for certification election should not have been 'ranted upon the 'round that the issues in the first case have been absorbed in the second caseB and (0) the lo$er court acted $ithout or in e5cess of (urisdiction in ta-in' co'ni?ance of the petition for certification election and that the same should have been dismissed instead of havin' been ordered $ithdra$n. ,he +niversity prayed that the proceedin's in Case No. !!106 =C and the order of )pril >, !">0 and the resolution of June 8, !">0 issued therein be annulled, and that the C&R be ordered to dismiss Case No. !!106=C on the 'round of lac- of (urisdiction. ,he ;aculty Club filed its ans$er, admittin' some, and denyin' other, alle'ations in the petition for certiorariB and specially alle'in' that the lo$er court7s order 'rantin' the $ithdra$al of the petition for certification election $as in accordance $ith la$, and that the resolution of the court en banc on June 8, !">0 $as not a violation of the $rit of preliminary in(unction issued in Case D.R. No. L62!2#1 because said $rit of in(unction $as issued a'ainst Jud'e Jose %. 4autista and not a'ainst the Court of &ndustrial Relations, much less a'ainst Jud'e 4alta?ar Jillanueva $ho $as the trial (ud'e of Case No. !!106=C. CA#& (. . !/. L)24?== ,his case, D.R. No. L62!8 , involves also C&R Case No. *!6&P). )s earlier stated, Case No. *!6&P) relates to the stri-e sta'ed by the members of the ;aculty Club and the dispute $as certified by the President of the Philippines to the C&R. ,he +niversity filed a motion to dismiss that case upon the 'round that the C&R has no (urisdiction over the case, and on =arch 0 , !">0 Jud'e Jose %. 4autista issued an order denyin' the motion to dismiss and declarin' that the &ndustrial Peace )ct is applicable to both parties in the case and that the C&R had ac3uired (urisdiction over the case by virtue of the presidential certificationB and in that same order Jud'e 4autista ordered the stri-ers to return to $or- and the +niversity to ta-e them bac- under the last terms and conditions e5istin' before the dispute aroseB and en(oined the +niversity from dismissin' any employee or laborer $ithout previous authority from the court. /n )pril !, !">0, the +niversity filed a motion for reconsideration of the order of =arch 0 , !">0 by the C&R en banc. ,hat motion for reconsideration $as pendin' action by the C&R en banc $hen the petition for certiorari and prohibition $ith preliminary in(unction in Case D.R. No. L62!2#1 $as filed on =ay ! , !">0. )s $e have already stated, this Court in said case D.R. No. L62!2#1, issued a $rit

of preliminary in(unction on =ay ! , !">0 orderin' respondent Jud'e Jose %. 4autista, until further order from this Court, to desist and refrain from further proceedin' in the premises (Cases Nos. *!6&P), !!106=C and J60 of the Court of &ndustrial Relations). /n July 2, !">0, the +niversity received a copy of the resolution of the C&R en banc, dated =ay #, !">0 but actually received and stamped at the /ffice of the Cler- of the C&R on June 21, !">0, denyin' the motion for reconsideration of the order dated =arch 0 , !">0 in Case No. *!6&P). /n July 20, !">0, the +niversity filed before this Court a petition for certiorari, by $ay of an appeal from the resolution of the Court of &ndustrial Relations en banc dated =ay #, !">0 (but actually received by said petitioner on July 2, !">0) denyin' the motion for reconsideration of the order of =arch 0 , !">0 in Case No. *!6&P). ,his petition $as doc-eted as D.R. No. L62!8 . &n its petition for certiorari the +niversity alle'es (!) that the resolution of the C&R en banc, dated =ay #, !">0 but filed $ith the Cler- of the C&R on June 21, !">0, in Case No. *!6&P), is null and void because it $as issued in violation of the $rit of preliminary in(unction issued by this Court in D.R. No. L62!2#1B (2) that the C&R, throu'h its Presidin' Jud'e, had no (urisdiction to ta-e co'ni?ance of Case No. *!6&P) and the order of =arch 0 , !">0 and the resolution dated =ay #, !">0 issued therein are null and voidB (0) that the certification made by the President of the Philippines is not authori?ed by %ection ! of Republic )ct 1#8, but is violative thereofB (*) that the ;aculty Club has no ri'ht to unioni?e or or'ani?e as a labor union for collective bar'ainin' purposes and to be certified as a collective bar'ainin' a'ent $ithin the purvie$ of the &ndustrial Peace )ct, and conse3uently it has no ri'ht to stri-e and pic-et on the 'round of petitioner7s alle'ed refusal to bar'ain collectively $here such duty does not e5ist in la$ and is not enforceable a'ainst an educational institutionB and (8) that the return6to6$or- order of =arch 0 , !">0 is improper and ille'al. ,he petition prayed that the proceedin's in Case No. *!6&P) be annulled, that the order dated =arch 0 , !">0 and the resolution dated =ay #, !">0 be revo-ed, and that the lo$er court be ordered to dismiss Case *!6&P) on the 'round of lac- of (urisdiction. /n %eptember ! , !">0, the ;aculty Club, throu'h counsel, filed a motion to dismiss the petition for certiorari on the 'round that the petition bein' filed by $ay of an appeal from the orders of the Court of &ndustrial Relations denyin' the motion to dismiss in Case No. *!6&P), the petition for certiorari is not proper because the orders appealed from are interlocutory in nature. ,his Court, by resolution of %eptember 2>, !">0, ordered that these three cases (D.R. Nos. L62!2#1, L62!*>2 and L62!8 ) be considered to'ether and the motion to dismiss in Case D.R. No. L62!8 be ta-en up $hen the cases are decided on the merits after the hearin'. 4rushin' aside certain technical 3uestions raised by the parties in their pleadin's, @e proceed to decide these three cases on the merits of the issues raised. ,he +niversity has raised several issues in the present cases, the pivotal one bein' its claim that the Court of &ndustrial Relations has no (urisdiction over the parties and the sub(ect matter in C&R Cases *!6&P), !!106=C and J60 , brou'ht before it, upon the 'round that Republic )ct No. 1#8 is not applicable to the +niversity because it is an educational institution and not an industrial establishment and hence not an <employer< in contemplation of said )ctB and neither is Republic )ct No. 1#8 applicable to the members of the ;aculty Club because the latter are independent contractors and, therefore, not employees $ithin the purvie$ of the said )ct. &n support of the contention that bein' an educational institution it is beyond the scope of Republic )ct No. 1#8, the +niversity cites cases decided by this Court. Boy #couts of t%e P%ili''ines vs. 1uliana Araos, L6! "!, Jan. 2", !"81B University of #an A"ustin vs. CI 0 et al.0 L6!2222, =ay 21, !"81B Cebu C%inese Hi"% #c%ool vs. P%ili''ine Land)Air)#ea Labor Union, PLA#LU, L6!2 !8, )pril 22, !"8"B La Consolacion Colle"e0 et al. vs. CI 0 et al.0 L6!0212, )pril 22, !"> B University of t%e P%ili''ines0 et al. vs. CI 0 et al.0 L6!8*!>, )pril 1, !"> B Far &astern University vs. CI , L6!#>2 , )u'ust 0!, !">2. @e have revie$ed these cases, and also related cases subse3uent thereto, and @e find that they do not sustain the contention of the +niversity. &t is true that this Court has ruled that certain educational institutions, li-e the +niversity of %anto ,omas, +niversity of %an )'ustin, La Consolacion Colle'e, and other (uridical entities, li-e the 4oy %couts of the Philippines and =anila %anitarium, are beyond the purvie$ of Republic )ct No. 1#8 in the sense that the Court of &ndustrial Relations has no (urisdiction to ta-e co'ni?ance of char'es of unfair labor practice filed a'ainst them, but it is nonetheless true that the principal reason of this Court in rulin' in those cases that those institutions are e5cluded from the operation of Republic )ct 1#8 is that those entities are not or'ani?ed, maintained and operated for profit and do not declare dividends to stoc-holders. ,he decision in the case of +niversity of %an )'ustin vs. Court of &ndustrial Relations, D.R. No. L6!2222, =ay 21, !"81, is very pertinent. @e 3uote a portion of the decision. &t appears that the +niversity of %an )'ustin, petitioner herein, is an educational institution conducted and mana'ed by a <reli'ious non6stoc- corporation duly or'ani?ed and e5istin' under the la$s of the Philippines.< &t $as or'ani?ed not for profit or 'ain or division of the dividends amon' its stoc-holders, but solely for reli'ious and educational purposes. &t li-e$ise appears that the Philippine )ssociation of Colle'e and +niversity Professors, respondent herein, is a non6stoc- association composed of professors and teachers in different colle'es and universities and that since its or'ani?ation t$o years a'o, the university has adopted a hostile attitude to its formation and has tried to discriminate, harass and intimidate its members for $hich reason the association and the members affected filed the unfair labor practice complaint $hich initiated this proceedin'. ,o the complaint of unfair labor practice, petitioner filed an ans$er $herein it disputed the (urisdiction of the Court of &ndustrial Relations over the controversy on the follo$in' 'rounds. <(a) ,hat complainants therein bein' colle'e andMor university professors $ere not <industrial< laborers or employees, and the Philippine )ssociation of Colle'e and +niversity Professors bein' composed of persons en'a'ed in the

teachin' profession, is not and cannot be a le'itimate labor or'ani?ation $ithin the meanin' of the la$s creatin' the Court of &ndustrial Relations and definin' its po$ers and functionsB <(b) ,hat the +niversity of %an )'ustin, respondent therein, is not an institution established for the purpose of 'ain or division of profits, and conse3uently, it is not an <industrial< enterprise and the members of its teachin' staff are not en'a'ed in <industrial< employment (+.%.,. Aospital :mployees )ssociation vs. %to. ,omas +niversity Aospital, D.R. No. L6>"11, 2* =ay !"8*B and %an 4eda Colle'e vs. Court of &ndustrial Relations and National Labor +nion, D.R. No. L6#>*", 2" /ctober !"88B 8! /.D. (Nov. !"88) 8>0>68>* )B <(c) ,hat, as a necessary conse3uence, alle'ed controversy bet$een therein complainants and respondent is not an <industrial< dispute, and the Court of &ndustrial Relations has no (urisdiction, notonly on the parties but also over the sub(ect matter of the complaint.< ,he issue no$ before us is. %ince the +niversity of %an )'ustin is not an institution established for profit or 'ain, nor an industrial enterprise, but one established e5clusively for educational purposes, can it be said that its relation $ith its professors is one of employer and employee that comes under the (urisdiction of the Court of &ndustrial RelationsO &n other $ords, do the provisions of the =a'na Carta on unfair labor practice apply to the relation bet$een petitioner and members of respondent associationO ,he issue is not ne$. ,hus, in the case of Boy #couts of t%e P%ili''ines v. 1uliana <. Araos, D.R. No. L6! "!, promul'ated on January 2", !"81, this Court, spea-in' thru =r. Justice =ontemayor, ans$ered the 3uery in the ne'ative in the follo$in' $ise. <,he main issue involved in the present case is $hether or not a charitable institution or one or'ani?ed not for profit but for more elevated purposes, charitable, humanitarian, etc., li-e the 4oy %couts of the Philippines, is included in the definition of <employer< contained in Republic )ct 1#8, and $hether the employees of said institution fall under the definition of <employee< also contained in the same Republic )ct. &f they are included, then any act $hich may be considered unfair labor practice, $ithin the meanin' of said Republic )ct, $ould come under the (urisdiction of the Court of &ndustrial RelationsB but if they do not fall $ithin the scope of said Republic )ct, particularly, its definitions of employer and employee, then the &ndustrial Court $ould have no (urisdiction at all. 555 555 555

</n the basis of the fore'oin' considerations, there is every reason to believe that our labor le'islation from Common$ealth )ct No. ! 0, creatin' the Court of &ndustrial Relations, do$n throu'h the :i'ht6Aour Labor La$, to the &ndustrial Peace )ct, $as intended by the Le'islature to apply only to industrial employment and to 'overn the relations bet$een employers en'a'ed in industry and occupations for purposes of profit and 'ain, and their industrial employees, but not to or'ani?ations and entities $hich are or'ani?ed, operated and maintained not for profit or 'ain, but for elevated and lofty purposes, such as, charity, social service, education and instruction, hospital and medical service, the encoura'ement and promotion of character, patriotism and -indred virtues in youth of the nation, etc. <&n conclusion, $e find and hold that Republic )ct No. 1#8, particularly, that portion thereof re'ardin' labor disputes and unfair labor practice, does not apply to the 4oy %couts of the Philippines, and conse3uently, the Court of &ndustrial Relations had no (urisdiction to entertain and decide the action or petition filed by respondent )raos. @herefore, the appealed decision and resolution of the C&R are hereby set aside, $ith costs a'ainst respondent.< ,here bein' a close analo'y bet$een the relation and facts involved in the t$o cases, $e cannot but conclude that the Court of &ndustrial Relations has no (urisdiction to entertain the complaint for unfair labor practice lod'ed by respondent association a'ainst petitioner and, therefore, $e hereby set aside the order and resolution sub(ect to the present petition, $ith costs a'ainst respondent association. ,he same doctrine $as confirmed in the case of University of #anto $omas v. Hon. Balta+ar <illanueva0 et al.0 D.R. No. L6!0#*1, /ctober 0 , !"8", $here this Court ruled that. &n the present case, the record reveals that the petitioner +niversity of %anto ,omas is not an industry or'ani?ed for profit but an institution of learnin' devoted e5clusively to the education of the youth. ,he Court of ;irst &nstance of =anila in its decision in Civil Case No. 211# , $hich has lon' become final and conse3uently the settled la$ in the case, found as established by the evidence adduced by the parties therein (herein petitioner and respondent labor union) that $hile the +niversity collects fees from its students, all its income is used for the improvement and enlar'ement of the institution. ,he +niversity declares no dividend, and the members of the corporation $ho founded it, as ordained in its articles of incorporation, receive no material compensation for the time and sacrifice they render to the +niversity and its students. ,he respondent union itself in a case before the &ndustrial Court (Case No. 0!*6=C) has averred that <the +niversity of %anto ,omas, li-e the %an 4eda Colle'e, is an educational institution operated not for profit but for the sole purpose of educatin' youn' men.< (%ee )nne5 <4< to petitioner7s motion to dismiss.). &t is apparent, therefore, that on the face of the record the +niversity of %anto ,omas is not a corporation created for profit but an educational institution and therefore not an industrial or business or'ani?ation.

&n the case of La Consolacion Colle"e0 et al. vs. CI 0 et al.0 D.R. No. L6!0212, )pril 22, !"> , this Court repeated the same rulin' $hen it said. ,he main issue in this appeal by petitioner is that the industry trial court committed an error in holdin' that it has (urisdiction to act in this case even if it involves unfair labor practice considerin' that the La Consolacion Colle'e is not a business enterprise but an educational institution not or'ani?ed for profit. &f the claim that petitioner is an educational institution not operated for profit is true, $hich apparently is the case, because the very court a 7uo found that it has no stoc-holder, nor capital . . . then $e are of the opinion that the same does not come under the (urisdiction of the Court of &ndustrial Relations in vie$ of the rulin' in the case of 4oy %couts of the Philippines v. Juliana J. )raos, D.R. No. L6! "!, decided on January 2", !"81. &t is note$orthy that the cases of the +niversity of %an )'ustin, the +niversity of %anto ,omas, and La Consolacion Colle'e, cited above, all involve char'es of unfair labor practice under Republic )ct No. 1#8, and the uniform rulin's of this Court are that the Court of &ndustrial Relations has no (urisdiction over the char'es because said )ct does not apply to educational institutions that are not operated or maintained for profit and do not declare dividends. /n the other hand, in the cases of Far &astern University v. CI 0 et al.0 D.R. No. L6!#>2 , )u'ust 0!, !">2, this Court upheld the decision of the Court of &ndustrial Relations findin' the ;ar :astern +niversity, also an educational institution, 'uilty of unfair labor practice. )mon' the findin's of fact in said case $as that the ;ar :astern +niversity made profits from the school year !"826!"80 to !"816!"8". &n affirmin' the decision of the lo$er court, this Court had thereby ratified the rulin' of the Court of &ndustrial Relations $hich applied the &ndustrial Peace )ct to educational institutions that are or'ani?ed, operated and maintained for profit. &t is also note$orthy that in the decisions in the cases of the 4oy %couts of the Philippines, the +niversity of %an )'ustin, the +niversity of %to. ,omas, and La Consolacion Colle'e, this Court $as not unanimous in the vie$ that the &ndustrial Peace )ct (Republic )ct No. 1#8) is not applicable to charitable, eleemosynary or non6profit or'ani?ations C $hich include educational institutions not operated for profit. ,here are members of this Court $ho hold the vie$ that the &ndustrial Peace )ct $ould apply also to non6profit or'ani?ations or entities C the only e5ception bein' the Dovernment, includin' any political subdivision or instrumentality thereof, in so far as 'overnmental functions are concerned. Ao$ever, in the ;ar :astern +niversity case this Court is unanimous in supportin' the vie$ that an educational institution that is operated for profit comes $ithin the scope of the &ndustrial Peace )ct. @e consider it a settled doctrine of this Court, therefore, that the &ndustrial Peace )ct is applicable to any or'ani?ation or entity C $hatever may be its purpose $hen it $as created C that is operated for profit or 'ain. 9oes the +niversity operate as an educational institution for profitO 9oes it declare dividends for its stoc-holdersO &f it does not, it must be declared beyond the purvie$ of Republic )ct No. 1#8B but if it does, Republic )ct No. 1#8 must apply to it. ,he +niversity itself admits that it has declared dividends.0 ,he C&R in its order dated =arch 0 , !">0 in C&R Case No. *!6&P) C $hich order $as issued after evidence $as heard C also found that the +niversity is not for strictly educational purposes and that <&t reali?es profits and parts of such earnin' is distributed as dividends to private stoc-holders or individuals (:5h. ) and also ! to !6;, 265 065 and *65)<* +nder this circumstance, and in consonance $ith the rulin's in the decisions of this Court, above cited, it is obvious that Republic )ct No. 1#8 is applicable to herein petitioner ;eati +niversity. 4ut the +niversity claims that it is not an employer $ithin the contemplation of Republic )ct No. 1#8, because it is not an industrial establishment. )t most, it says, it is only a lessee of the services of its professors andMor instructors pursuant to a contract of services entered into bet$een them. @e find no merit in this claim. Let us clarify $ho is an <employer< under the )ct. %ection 2(c) of said )ct provides. %ec. 2. 9efinitions.C)s used in this )ct C (c) ,he term employer include any person actin' in the interest of an employer, directly or indirectly, but shall not include any labor or'ani?ation (other$ise than $hen actin' as an employer) or any one actin' in the capacity or a'ent of such labor or'ani?ation. &t $ill be noted that in definin' the term <employer< the )ct uses the $ord <includes<, $hich it also used in definin' <employee<. G%ec. 2 (d)H, and <representative< G%ec. 2(h)HB and not the $ord <means< $hich the )ct uses in definin' the terms <court< G%ec. 2(a)H, <labor or'ani?ation< G%ec. 2(e)H, <le'itimate labor or'ani?ation G%ec. 2(f)H, <company union< G%ec. 2(')H, <unfair labor practice< G%ec. 2(i)H, <supervisor< G%ec. 2(-)H, <stri-e< G%ec. 2(l)H and <loc-6out< G%ec. 2(m)H. ) methodical variation in terminolo'y is manifest. ,his variation and distinction in terminolo'y and phraseolo'y cannot be presumed to have been the inconse3uential product of an oversi'htB rather, it must have been the result of a deliberate and purposeful act, more so $hen $e consider that as le'islative records sho$, Republic )ct No. 1#8 had been meticulously and painsta-in'ly drafted and deliberated upon. &n usin' the $ord <includes< and not <means<, Con'ress did not intend to 'ive a complete definition of <employer<, but rather that such definition should be complementary to $hat is commonly understood as employer. Con'ress intended the term to be understood in a broad meanin' because, firstly, the statutory definition includes not only <a principal employer but also a person actin' in the interest of the employer<B and, secondly, the )ct itself specifically enumerated those $ho are not included in the term <employer<, namely. (!) a labor or'ani?ation (other$ise than $hen actin' as an employer), (2) anyone actin' in the capacity of officer or a'ent of such labor or'ani?ation G%ec. 2(c)H, and (0) the Dovernment and any political subdivision or instrumentality thereof insofar as the ri'ht to stri-e for the purpose of securin' chan'es or modifications in the terms and conditions of employment is concerned (%ection !!). )mon' these statutory e5emptions, educational

institutions are not includedB hence, they can be included in the term <employer<. ,his Court, ho$ever, has ruled that those educational institutions that are not operated for profit are not $ithin the purvie$ of Republic )ct No. 1#8.8 )s stated above, Republic )ct No. 1#8 does not 'ive a comprehensive but only a complementary definition of the term <employer<. ,he term encompasses those that are in ordinary parlance <employers.< @hat is commonly meant by <employer<O ,he term <employer< has been 'iven several acceptations. ,he le5ical definition is <one $ho employsB one $ho usesB one $ho en'a'es or -eeps in serviceB< and <to employ< is <to provide $or- and pay forB to en'a'e one7s serviceB to hire.< (@ebster7s Ne$ ,$entieth Century 9ictionary, 2nd ed., !"> , p. 8"8). ,he @or-men7s Compensation )ct defines employer as includin' <every person or association of persons, incorporated or not, public or private, and the le'al representative of the deceased employer< and <includes the o$ner or lessee of a factory or establishment or place of $or- or any other person $ho is virtually the o$ner or mana'er of the business carried on in the establishment or place of $or- but $ho, for reason that there is an independent contractor in the same, or for any other reason, is not the direct employer of laborers employed there.< G%ec. 0"(a) of )ct No. 0*21.H ,he =inimum @a'e La$ states that <employer includes any person actin' directly or indirectly in the interest of the employer in relation to an employee and shall include the Dovernment and the 'overnment corporations<. GRep. )ct No. > 2, %ec. 2(b)H. ,he %ocial %ecurity )ct defines employer as <any person, natural or (uridical, domestic or forei'n, $ho carries in the Philippines any trade, business, industry, underta-in', or activity of any -ind and uses the services of another person $ho is under his orders as re'ards the employment, e5cept the Dovernment and any of its political subdivisions, branches or instrumentalities, includin' corporations o$ned or controlled by the Dovernment.< (Rep. )ct No. !!>!, %ec. 1GcH). ,his Court, in the cases of the ,he )n'at River &rri'ation %ystem, et al. vs. )n'at River @or-ers7 +nion (PL+=), et al., D.R. Nos. L6 ! "0* and L6! "**, 9ecember 21, !"8#, $hich cases involve unfair labor practices and hence $ithin the purvie$ of Republic )ct No. 1#8, defined the term employer as follo$s. )n employer is one $ho employs the services of othersB one for $hom employees $or- and $ho pays their $a'es or salaries (4lac- La$ 9ictionary, *th ed., p. >!1). )n employer includes any person actin' in the interest of an employer, directly or indirectly (%ec. 26c, Rep. )ct 1#8). +nder none of the above definitions may the +niversity be e5cluded, especially so if it is considered that every professor, instructor or teacher in the teachin' staff of the +niversity, as per alle'ation of the +niversity itself, has a contract $ith the latter for teachin' services, albeit for one semester only. ,he +niversity en'a'ed the services of the professors, provided them $or-, and paid them compensation or salary for their services. :ven if the +niversity may be considered as a lessee of services under a contract bet$een it and the members of its ;aculty, still it is included in the term <employer<. <Runnin' throu'h the $ord Pemploy7 is the thou'ht that there has been an a'reement on the part of one person to perform a certain service in return for compensation to be paid by an employer. @hen you as- ho$ a man is employed, or $hat is his employment, the thou'ht that he is under a'reement to perform some service or services for another is predominant and paramount.< (4allentine La$ 9ictionary, Philippine ed., p. *0 , citin' Pin-erton National 9etective )'ency v. @al-er, !8# Da. 8*1, 08 ). L. R. 88#, 8> , !22 %.:. Rep. 2 2). ,o bolster its claim of e5ception from the application of Republic )ct No. 1#8, the +niversity contends that it is not state that the employers included in the definition of 2 (c) of the )ct. ,his contention can not be sustained. &n the first place, %ec. 2 (c) of Republic )ct No. 1#8 does not state that the employers included in the definition of the term <employer< are only and e5clusively <industrial establishments<B on the contrary, as stated above, the term <employer< encompasses all employers e5cept those specifically e5cluded by the )ct. &n the second place, even the )ct itself does not refer e5clusively to industrial establishments and does not confine its application thereto. ,his is patent inasmuch as several provisions of the )ct are applicable to non6industrial $or-ers, such as %ec. 0, $hich deals $ith <employees7 ri'ht to self6or'ani?ation<B %ections * and 8 $hich enumerate unfair labor practicesB %ection 1 $hich nullifies private contracts contravenin' employee7s ri'htsB %ection " $hich relates to in(unctions in any case involvin' a labor disputeB %ection !! $hich prohibits stri-es in the 'overnmentB %ection !2 $hich provides for the e5clusive collective bar'ainin' representation for labor or'ani?ationsB %ection !* $hich deals $ith the procedure for collective bar'ainin'B %ection !# $hich treats of the ri'hts and conditions of membership in labor or'ani?ationsB %ections !1, !", 2 and 2! $hich provide respectively for the establishment of conciliation service, compilation of collective bar'ainin' contracts, advisory labor6mana'ement relationsB %ection 22 $hich empo$ers the %ecretary of Labor to ma-e a study of labor relationsB and %ection 2* $hich enumerates the ri'hts of labor or'ani?ations. (%ee 9issentin' /pinion of Justice Concepcion in 4oy %couts of the Philippines v. Juliana )raos, D.R. No. L6! "!, January 2", !"81.) ,his Court, in the case of 4oy %couts of the Philippines v. )raos, su'ra, had occasion to state that the &ndustrial Peace )ct <refers only to or'ani?ations and entities created and operated for profits, en'a'ed in a profitable trade, occupation or industry<. &t cannot be denied that runnin' a university en'a'es time and attentionB that it is an occupation or a business from $hich the one en'a'ed in it may derive profit or 'ain. ,he +niversity is not an industrial establishment in the sense that an industrial establishment is one that is en'a'ed in manufacture or trade $here ra$ materials are chan'ed or fashioned into finished products for use. 4ut for the purposes of the &ndustrial Peace )ct the +niversity is an industrial establishment because it is operated for profit and it employs persons $ho $or- to earn a livin'. ,he term <industry<, for the purposes of the application of our labor la$s should be 'iven a broad meanin' so as to cover all enterprises $hich are operated for profit and $hich en'a'e the services of persons $ho $or- to earn a livin'. ,he $ord <industry< $ithin %tate Labor Relations )ct controllin' labor relations in industry, cover labor conditions in any field of employment $here the ob(ective is earnin' a livelihood on the one side and 'ainin' of a profit on the other. Labor La$ %ec. # et se3. %tate Labor Relations 4oard vs. =cChesney, 2# N.E.%. 2d 1>>, 1>1.< (@ords and Phrases, Permanent :dition, Jol. 2!, !"> edition p. 8! ).

,he +niversity ur'es that even if it $ere an employer, still there $ould be no employer6employee relationship bet$een it and the stri-in' members of the ;aculty Club because the latter are not employees $ithin the purvie$ of %ec. 2(d) of Republic )ct No. 1#8 but are independent contractors. ,his claim is untenable. %ection 2 (d) of Republic )ct No. 1#8 provides. (d) ,he term <employee< shall include any employee and shall not be limited to the employee of a particular employer unless the act e5plicitly states other$ise and shall include any individual $hose $or- has ceased as a conse3uence of, or in connection $ith, any current labor dispute or because of any unfair labor practice and $ho has not obtained any other substantially e3uivalent and re'ular employment. ,his definition is a'ain, li-e the definition of the term <employer< G%ec. 2(c)H, by the use of the term <include<, complementary. &t embraces not only those $ho are usually and ordinarily considered employees, but also those $ho have ceased as employees as a conse3uence of a labor dispute. ,he term <employee<, furthermore, is not limited to those of a particular employer. )s already stated, this Court in the cases of ,he )n'at River &rri'ation %ystem, et al. v. )n'at River @or-ers7 +nion (PL+=), et al., su'ra, has defined the term <employer< as <one $ho employs the services of othersB one for $hom employees $or- and $ho pays their $a'es or salaries. <Correlatively, an employee must be one $ho is en'a'ed in the service of anotherB $ho performs services for anotherB $ho $or-s for salary or $a'es. &t is admitted by the +niversity that the stri-in' professors andMor instructors are under contract to teach particular courses and that they are paid for their services. ,hey are, therefore, employees of the +niversity. &n support of its claim that the members of the ;aculty Club are not employees of the +niversity, the latter cites as authority ;rancisco7s Labor La$s, 2nd ed., p. 0, $hich states. @hile the term <$or-ers< as used in a particular statute, has been re'arded as limited to those performin' physical labor, it has been held to embrace steno'raphers and boo--eepers. ,eachers are not included, ho$ever. &t is evident from the above63uoted authority that <teachers< are not to be included amon' those $ho perform <physical labor<, but it does not mean that they are not employees. @e have chec-ed the source of the authority, $hich is 0! )m. Jur., %ec. 0, p. 108, and the latter cites Aunt$orth v. ,anner, 1# @ash ># , !82 P. 820, )nn Cas !"!# 9 >#>. ) readin' of the last case confirms /ur vie$. ,hat teachers are <employees7 has been held in a number of cases ()ebli v. 4oard of :ducation of City and County of %an ;rancisco, !*8 P. 2d > !, >2 Col. )pp 2.d # >B Lo$e Q Campbell %portin' Doods Co. v. ,an'ipahoa Parish %chool 4oard, La. )pp., !8 %o. 2d "1, ! B %ister /delia v. Church of %t. )ndre$, 2>0 N. @. !!!, !!2, !"8 =inn. 08#, cited in @ords and Phrases, Permanent ed., Jol. !*, pp. 1 >61 #). ,his Court in the ;ar :astern +niversity case, su'ra, considered university instructors as employees and declared Republic )ct No. 1#8 applicable to them in their employment relations $ith their school. ,he professors andMor instructors of the +niversity neither ceased to be employees $hen they struc-, for %ection 2 of Rep. )ct 1#8 includes amon' employees any individual $hose $or- has ceased as conse3uence of, or in connection $ith a current labor dispute. %tri-in' employees maintain their status as employees of the employer. (@estern Cartrid'e Co. v. NLR4, C.C.). #, !0" ;2d 188, 181). ,he contention of the +niversity that the professors andMor instructors are independent contractors, because the +niversity does not e5ercise control over their $or-, is li-e$ise untenable. ,his Court ta-es (udicial notice that a university controls the $or- of the members of its facultyB that a university prescribes the courses or sub(ects that professors teach, and $hen and $here to teachB that the professors7 $or- is characteri?ed by re'ularity and continuity for a fi5ed durationB that professors are compensated for their services by $a'es and salaries, rather than by profitsB that the professors andMor instructors cannot substitute others to do their $or- $ithout the consent of the universityB and that the professors can be laid off if their $or- is found not satisfactory. )ll these indicate that the university has control over their $or-B and professors are, therefore, employees and not independent contractors. ,here are authorities in support of this vie$. ,he principal consideration in determinin' $hether a $or-man is an employee or an independent contractor is the ri'ht to control the manner of doin' the $or-, and it is not the actual e5ercise of the ri'ht by interferin' $ith the $or-, but the ri'ht to control, $hich constitutes the test. ()mal'amated Roofin' Co. v. ,ravelers7 &ns. Co., !00 N.:. 28", 2>!, 0 &ll. *1#, 3uoted in @ords and Phrases, Permanent ed., Jol. !*, p. 8#>). @here, under :mployers7 Liability )ct, ) $as instructed $hen and $here to $or- . . . he is an employee, and not a contractor, thou'h paid specified sum per s3uare. (Aeine v. Aill, Aarris Q Co., 2 La. )pp. 01*, 0" , in @ords and Phrases, loc, cit.) . :mployees are those $ho are compensated for their labor or services by $a'es rather than by profits. (People vs. 9istributors 9ivision, %mo-ed ;ish @or-ers +nion Local No. 2 0##, %up. # N. E. %. 2d !18, !1# in @ords and Phrases, loc, cit.) %ervices of employee or servant, as distin'uished from those of a contractor, are usually characteri?ed by re'ularity and continuity of $or- for a fi5ed period or one of indefinite duration, as contrasted $ith employment to do a sin'le act or a series of isolated actsB by compensation on a fi5ed salary rather than one re'ulated by value or amount of $or-B . . . (+nder$ood v. Commissioner of &nternal Revenue, C.C.)., 8> ;. 2d >#, #! in @ords and Phrases, op. cit., p. 8#".)

&ndependent contractors can employ others to $or- and accomplish contemplated result $ithout consent of contractee, $hile <employee< cannot substitute another in his place $ithout consent of his employer. (Lu-er %and Q Dravel Co. v. &ndustrial Commission, 20 P. 2d 228, 12 +tah, !11, in @ords and Phrases, Jol. !*, p. 8#>). =oreover, even if university professors are considered independent contractors, still they $ould be covered by Rep. )ct No. 1#8. &n the case of the 4oy %couts of the Philippines v. Juliana )raos, su'ra, this Court observed that Republic )ct No. 1#8 $as modelled after the @a'ner )ct, or the National Labor Relations )ct, of the +nited %tates, and this )ct did not e5clude <independent contractors< from the orbit of <employees<. &t $as in the subse3uent le'islation C the Labor =ana'ement Relation )ct (,aft6Aarley )ct) C that <independent contractors< to'ether $ith a'ricultural laborers, individuals in domestic service of the home, supervisors, and others $ere e5cluded. (%ee Rothenber' on Labor Relations, !"*", pp. 00 600!). &t havin' been sho$n that the members of the ;aculty Club are employees, it follo$s that they have a ri'ht to unioni?e in accordance $ith the provisions of %ection 0 of the =a'na Carta of Labor (Republic )ct No. 1#8) $hich provides as follo$s. %ec. 0. &m'loyees6 ri"%t to self)or"ani+ation.C:mployees shall have the ri'ht to self6or'ani?ation and to form, (oin or assist labor or'ani?ations of their o$n choosin' for the purpose of collective bar'ainin' throu'h representatives of their o$n choosin' and to en'a'e in concerted activities for the purpose of collective bar'ainin' and other mutual aid or protection. . . . @e a'ree $ith the statement of the lo$er court, in its order of =arch 0 , !">0 $hich is sou'ht to be set aside in the instant case, that the ri'ht of employees to self6or'ani?ation is 'uaranteed by the Constitution, that said ri'ht $ould e5ist even if Republic )ct No. 1#8 is repealed, and that re'ardless of $hether their employers are en'a'ed in commerce or not. &ndeed, it is /ur considered vie$ that the members of the faculty or teachin' staff of private universities, colle'es, and schools in the Philippines, re'ardless of $hether the university, colle'e or school is run for profit or not, are included in the term <employees< as contemplated in Republic )ct No. 1#8 and as such they may or'ani?e themselves pursuant to the above63uoted provision of %ection 0 of said )ct. Certainly, professors, instructors or teachers of private educational institutions $ho teach to earn a livin' are entitled to the protection of our labor la$s C and one such la$ is Republic )ct No. 1#8. ,he contention of the +niversity in the instant case that the members of the ;aculty Club can not unioni?e and the ;aculty Club can not e5ist as a valid labor or'ani?ation is, therefore, $ithout merit. ,he record sho$s that the ;aculty Club is a duly re'istered labor or'ani?ation and this fact is admitted by counsel for the +niversity. 8a ,he other issue raised by the +niversity is the validity of the Presidential certification. ,he +niversity contends that under %ection ! of Republic )ct No. 1#8 the po$er of the President of the Philippines to certify is sub(ect to the follo$in' conditions, namely. (!) that here is a labor dispute, and (2) that said labor dispute e5ists in an industry that is vital to the national interest. ,he +niversity maintains that those conditions do not obtain in the instant case. ,his contention has also no merit. @e have previously stated that the +niversity is an establishment or enterprise that is included in the term <industry< and is covered by the provisions of Republic )ct No. 1#8. No$, $as there a labor dispute bet$een the +niversity and the ;aculty ClubO Republic )ct No. 1#8 defines a labor dispute as follo$s. ,he term <labor dispute< includes any controversy concernin' terms, tenure or conditions of employment, or concernin' the association or representation of persons in ne'otiatin', fi5in', maintainin', chan'in', or see-in' to arran'e terms or conditions of employment re'ardless of $hether the disputants stand in pro5imate relation of employer and employees. ,he test of $hether a controversy comes $ithin the definition of <labor dispute< depends on $hether the controversy involves or concerns <terms, tenure or condition of employment< or <representation.< &t is admitted by the +niversity, in the instant case, that on January !*, !">0 the President of the ;aculty Club $rote to the President of the +niversity a letter informin' the latter of the or'ani?ation of the ;aculty Club as a labor union, duly re'istered $ith the 4ureau of Labor RelationsB that a'ain on January 22, !">0 another letter $as sent, to $hich $as attached a list of demands consistin' of 2> items, and as-in' the President of the +niversity to ans$er $ithin ten days from date of receipt thereofB that the +niversity 3uestioned the ri'ht of the ;aculty Club to be the e5clusive representative of the ma(ority of the employees and as-ed proof that the ;aculty Club had been desi'nated or selected as e5clusive representative by the vote of the ma(ority of said employeesB that on ;ebruary !, !">0 the ;aculty Club filed $ith the 4ureau of Labor Relations a notice of stri-e alle'in' as reason therefor the refusal of the +niversity to bar'ain collectively $ith the representative of the faculty membersB that on ;ebruary !1, !">0 the members of the ;aculty Club $ent on stri-e and established pic-et lines in the premises of the +niversity, thereby disruptin' the schedule of classesB that on =arch !, !">0 the ;aculty Club filed Case No. 0>>>6+LP for unfair labor practice a'ainst the +niversity, but $hich $as later dismissed (on )pril 2, !">0 after Case *!6&P) $as certified to the C&R)B and that on =arch #, !">0 a petition for certification election, Case No. !!106=C, $as filed by the ;aculty Club in the C&R.> )ll these admitted facts sho$ that the controversy bet$een the +niversity and the ;aculty Club involved terms and conditions of employment, and the 3uestion of representation. Aence, there $as a labor dispute bet$een the +niversity and the ;aculty Club, as contemplated by Republic )ct No. 1#8. &t havin' been sho$n that the +niversity is an institution operated for profit, that is an employer, and that there is an employer6employee relationship, bet$een the +niversity and the members of the ;aculty Club, and it havin' been sho$n that a labor dispute e5isted bet$een the +niversity and the ;aculty Club, the contention of the +niversity, that the certification made by the President is not only not authori?ed by %ection ! of Republic )ct 1#8 but is violative thereof, is 'roundless.

%ection ! of Republic )ct No. 1#8 provides. @hen in the opinion of the President of the Philippines there e5ists a labor dispute in an industry indispensable to the national interest and $hen such labor dispute is certified by the President to the Court of &ndustrial Relations, said Court may cause to be issued a restrainin' order forbiddin' the employees to stri-e or the employer to loc-out the employees, and if no other solution to the dispute is found, the Court may issue an order fi5in' the terms and conditions of employment. ,his Court had occasion to rule on the application of the above63uoted provision of %ection ! of Republic )ct No. 1#8. &n the case of Pam'an"a #u"ar Develo'ment Co. v. CI 0 et al.0 D.R. No. L6!0!#1, =arch 2*, !">!, it $as held. &t thus appears that $hen in the opinion of the President a labor dispute e5ists in an industry indispensable to national interest and he certifies it to the Court of &ndustrial Relations the latter ac3uires (urisdiction to act thereon in the manner provided by la$. ,hus the court may ta-e either of the follo$in' courses. it may issue an order forbiddin' the employees to stri-e or the employer to loc-out its employees, or, failin' in this, it may issue an order fi5in' the terms and conditions of employment. &t has no other alternative. It can not t%ro- t%e case out in t%e assum'tion t%at t%e certification -as erroneous. 555 555 555

. . . ,he fact, ho$ever, is that because of the stri-e declared by the members of the minority union $hich threatens a ma(or industry the President deemed it $ise to certify the controversy to the Court of &ndustrial Relations for ad(udication. $%is is t%e 'o-er t%at t%e la- "ives to t%e President t%e 'ro'riety of its e*ercise bein" a matter t%at only devolves u'on %im. $%e same is not t%e concern of t%e industrial court. .%at matters is t%at by virtue of t%e certification made by t%e President t%e case -as 'laced under t%e @urisdiction of said court. (:mphasis supplied) ,o certify a labor dispute to the C&R is the prero'ative of the President under the la$, and this Court $ill not interfere in, much less curtail, the e5ercise of that prero'ative. ,he (urisdiction of the C&R in a certified case is e5clusive (Ri?al Cement Co., &nc. v. Ri?al Cement @or-ers +nion (;;@), et al., D.R. No. L6!2#*#, July 0 , !"> ). /nce the (urisdiction is ac3uired pursuant to the presidential certification, the C&R may e5ercise its broad po$ers as provided in Common$ealth )ct ! 0. )ll phases of the labor dispute and the employer6employee relationship may be threshed out before the C&R, and the C&R may issue such order or orders as may be necessary to ma-e effective the e5ercise of its (urisdiction. ,he parties involved in the case may appeal to the %upreme Court from the order or orders thus issued by the C&R. )nd so, in the instant case, $hen the President too- into consideration that the +niversity <has some !1, students and employed appro5imately 8 faculty members<, that Pthe continued disruption in the operation of the +niversity $ill necessarily pre(udice the thousand of students<, and that <the dispute affects the national interest<,#and certified the dispute to the C&R, it is not for the C&R nor this Court to pass upon the correctness of the reasons of the President in certifyin' the labor dispute to the C&R. ,he third issue raised by the +niversity refers to the 3uestion of the le'ality of the return6to6$or- order (of =arch 0 , !">0 in Case *!6 &P)) and the order implementin' the same (of )pril >, !">0). &t alle'es that the orders are ille'al upon the 'rounds. (!) that Republic )ct No. 1#8, supplementin' Common$ealth )ct No. ! 0, has $ithdra$n from the C&R the po$er to issue a return6to6$or- orderB (2) that the only po$er 'ranted by %ection ! of Republic )ct No. 1#8 to the C&R is to issue an order forbiddin' the employees to stri-e or forbiddin' the employer to loc-out the employees, as the case may be, before either contin'ency had become a fait accom'liB (0) that the ta-in' in by the +niversity of replacement professors $as valid, and the return6to6$or- order of =arch 0 , !">0 constituted impairment of the obli'ation of contractsB and (*) the C&R could not issue said order $ithout havin' previously determined the le'ality or ille'ality of the stri-e. ,he contention of the +niversity that Republic )ct No. 1#8 has $ithdra$n the po$er of the Court of &ndustrial Relations to issue a return6to6$or- order e5ercised by it under Common$ealth )ct No. ! 0 can not be sustained. @hen a case is certified by the President to the Court of &ndustrial Relations, the case thereby comes under the operation of Common$ealth )ct No. ! 0, and the Court may e5ercise the broad po$ers and (urisdiction 'ranted to it by said )ct. %ection ! of Republic )ct No. 1#8 empo$ers the Court of &ndustrial Relations to issue an order <fi5in' the terms of employment.< ,his clause is broad enou'h to authori?e the Court to order the stri-ers to return to $or- and the employer to readmit them. ,his Court, in the cases of the P%ili''ine ,arine /fficers Association vs. $%e Court of Industrial elations0 Com'ania ,aritima0 et al.B and Com'aAia ,artima0 et al. vs. P%ili''ine ,arine adio /fficers Association and CI 0 et al., D.R. Nos. L6! "8 and L6! !!8, /ctober 0!, !"8#, declared. @e cannot subscribe to the above contention. @e a'ree $ith counsel for the Philippine Radio /fficers7 )ssociation that upon certification by the President under %ection ! of Republic )ct 1#8, the case comes under the operation of Common$ealth )ct ! 0, $hich enforces compulsory arbitration in cases of labor disputes in industries indispensable to the national interest $hen the President certifies the case to the Court of &ndustrial Relations. ,he evident intention of the la$ is to empo$er the Court of &ndustrial Relations to act in such cases, not only in the manner prescribed under Common$ealth )ct ! 0, but $ith the same broad po$ers and (urisdiction 'ranted by that act. &f the Court of &ndustrial Relations is 'ranted authority to find a solution to an industrial dispute and such solution consists in the orderin' of employees to return bac- to $or-, it cannot be contended that the Court of &ndustrial Relations does not have the po$er or (urisdiction to carry that solution into effect. )nd of $hat use is its po$er of conciliation and arbitration if it does not have the po$er and (urisdiction to carry into effect the solution it has adoptedO Lastly, if the said court has the po$er to fi5 the terms and conditions of employment, it certainly can order the return of the $or-ers $ith or $ithout bac-pay as a term or condition of employment.

,he fore'oin' rulin' $as reiterated by this Court in the case of Hind #u"ar Co. v. CI 0 et al.0 D.R. No. L6!00>*, July 2>, !"> . @hen a case is certified to the C&R by the President of the Philippines pursuant to %ection ! of Republic )ct No. 1#8, the C&R is 'ranted authority to find a solution to the industrial disputeB and the solution $hich the C&R has found under the authority of the presidential certification and conformable thereto cannot be 3uestioned (Radio /perators )ssociation of the Philippines vs. Philippine =arine Radio /fficers )ssociation, et al., L6! !!2, Nov. 2", !"8#, 8* /.D. 02!1). +ntenable also is the claim of the +niversity that the C&R cannot issue a return6to6$or- order after stri-e has been declared, it bein' contended that under %ection ! of Republic )ct No. 1#8 the C&R can only prevent a stri-e or a loc-out C $hen either of this situation had not yet occurred. 4ut in the case of 4isaya Land ,ransportation Co., &nc. vs. Court of &ndustrial Relations, et al., No. L6! !!*, Nov. 2>, !"8#, 8 /.D. 28!1, this Court declared. ,here is no reason or 'round for the contention that Presidential certification of labor dispute to the C&R is limited to the prevention of stri-es and loc-outs. :ven after a stri-e has been declared $here the President believes that public interest demands arbitration and conciliation, the President may certify the ease for that purpose. ,he practice has been for the Court of &ndustrial Relations to order the stri-ers to $or-, 'endin" t%e determination of t%e union demands t%at im'elled t%e stri8e. ,here is nothin' in the la$ to indicate that this practice is abolished.< (:mphasis supplied) Li-e$ise untenable is the contention of the +niversity that the ta-in' in by it of replacements $as valid and the return6to6$or- order $ould be an impairment of its contract $ith the replacements. )s stated by the C&R in its order of =arch 0 , !">0, it $as a'reed before the hearin' of Case *!6&P) on =arch 20, !">0 that the stri-ers $ould return to $or- under the status 7uo arran'ement and the +niversity $ould readmit them, and the return6to6$or- order $as a confirmation of that a'reement. ,his is a declaration of fact by the C&R $hich $e cannot disre'ard. ,he faculty members, by stri-in', have not abandoned their employment but, rather, they have only ceased from their labor (2eith ,heatre v. Jachon et al., !1# ). >"2). ,he stri-in' faculty members have not lost their ri'ht to 'o bac- to their positions, because the declaration of a stri-e is not a renunciation of their employment and their employee relationship $ith the +niversity (Re5 ,a5icab Co. vs. C&R, et al., * /.D., No. !0, !01). ,he employment of replacements $as not authori?ed by the C&R. )t most, that $as a temporary e5pedient resorted to by the +niversity, $hich $as sub(ect to the po$er of the C&R to allo$ to continue or not. ,he employment of replacements by the +niversity prior to the issuance of the order of =arch 0 , !">0 did not vest in the replacements a permanent ri'ht to the positions they held. Neither could such temporary employment bind the +niversity to retain permanently the replacements. %tri-in' employees maintained their status as employees of the employer (@estern Castrid'e Co. v. National Labor Relations 4oard, C.C.). !0" ;. 2d 188, 181) B that employees $ho too- the place of stri-ers do not displace them as Pemployees.< 7 (National Labor Relations 4oard v. ). %artorius Q Co., C.C.). 2, !* ;. 2d 2 0, 2 >, 2 #.) &t is clear from $hat has been said that the return6to6$or- order cannot be considered as an impairment of the contract entered into by petitioner $ith the replacements. 4esides, labor contracts must yield to the common 'ood and such contracts are sub(ect to the special la$s on labor unions, collective bar'ainin', stri-es and similar sub(ects ()rticle !# , Civil Code). Li-e$ise unsustainable is the contention of the +niversity that the Court of &ndustrial Relations could not issue the return6to6$or- order $ithout havin' resolved previously the issue of the le'ality or ille'ality of the stri-e, citin' as authority therefor the case of P%ili''ine Can Com'any v. Court of Industrial elations, D.R. No. L60 2!, July !0, !"8 . ,he rulin' in said case is not applicable to the case at bar, the facts and circumstances bein' very different. ,he Philippine Can Company case, unli-e the instant case, did not involve the national interest and it $as not certified by the President. &n that case the company no lon'er needed the services of the stri-ers, nor did it need substitutes for the stri-ers, because the company $as losin', and it $as imperative that it lay off such laborers as $ere not necessary for its operation in order to save the company from ban-ruptcy. ,his $as the reason of this Court in rulin', in that case, that the le'ality or ille'ality of the stri-e should have been decided first before the issuance of the return6to6$or- order. ,he +niversity, in the case before +s, does not claim that it no lon'er needs the services of professors andMor instructorsB neither does it claim that it $as imperative for it to lay off the stri-in' professors and instructors because of impendin' ban-ruptcy. /n the contrary, it $as imperative for the +niversity to hire replacements for the stri-ers. ,herefore, the rulin' in the Philippine Can case that the le'ality of the stri-e should be decided first before the issuance of the return6to6$or- order does not apply to the case at bar. 4esides, as @e have adverted to, the return6to6$or- order of =arch 0 , !">0, no$ in 3uestion, $as a confirmation of an a'reement bet$een the +niversity and the ;aculty Club durin' a prehearin' conference on =arch 20, !">0. ,he +niversity also maintains that there $as no more basis for the claim of the members of the ;aculty Club to return to their $or-, as their individual contracts for teachin' had e5pired on =arch 28 or 0!, !">0, as the case may be, and conse3uently, there $as also no basis for the return6to6$or- order of the C&R because the contractual relationships havin' ceased there $ere no positions to $hich the members of the ;aculty Club could return to. ,his contention is not $ell ta-en. ,his ar'ument loses si'ht of the fact that $hen the professors and instructors struc- on ;ebruary !1, !">0, they continued to be employees of the +niversity for the purposes of the labor controversy not$ithstandin' the subse3uent termination of their teachin' contracts, for %ection 2(d) of the &ndustrial Peace )ct includes amon' employees <any individual $hose $or- has ceased a conse3uence of, or in connection $ith, any current labor dispute or of any unfair labor practice and $ho has not obtained any other substantially e3uivalent and re'ular employment.< ,he 3uestion raised by the +niversity $as resolved in a similar case in the +nited %tates. &n the case of Rapid Roller Co. v. NLR4 !2> ;. 2d *82, $e read.

/n =ay ", !"0" the stri-in' employees, ei'hty6four in number, offered to the company to return to their employment. ,he company believin' it had not committed any unfair labor practice, refused the employees7 offer and claimed the ri'ht to employ others to ta-e the place of the stri-ers, as it mi'ht see fit. ,his constituted discrimination in the hirin' and tenure of the stri-in' employees. @hen the employees $ent out on a stri-e because of the unfair labor practice of the company, their status as employees for the purpose of any controversy 'ro$in' out of that unfair labor practice $as fi5ed. %ec. 2 (0) of the )ct. Phelps 9od'e Corp. v. National Labor Relations 4oard, 0!0 +.%. !##, >! %. Ct. 1*8, 18. L. ed. !2#!, !00 ).L.R. !2!#. ;or the purpose of such controversy they remained employees of the company. ,he company contended that they could not be their employees in any event since the <contract of their employment e5pired by its o$n terms on )pril 20, !"0".< &n this $e thin- the company is mista-en for the reason $e have (ust pointed out, that the status of the employees on stri-e became fi5ed under %ec. 2 (0) of the )ct because of the unfair labor practice of the company $hich caused the stri-e. ,he +niversity, furthermore, claims that the information for indirect contempt filed a'ainst the officers of the +niversity (Case No. J60 ) as $ell as the order of )pril 2", !">0 for their arrest $ere improper, irre'ular and ille'al because (!) the officers of the +niversity had complied in 'ood faith $ith the return6to6$or- order and in those cases that they did not, it $as due to circumstance beyond their controlB (2) the return6to6$or- order and the order implementin' the same $ere ille'alB and (0) even assumin' that the order $as le'al, the same $as not Eet final because there $as a motion to reconsider it. )'ain @e find no merit in this claim of Petitioner. @e have already ruled that the C&R had (urisdiction to issue the order of =arch 0 , !">0 in C&R Case *!6&P), and the return6to6$or- provision of that order is valid and le'al. Necessarily the order of )pril >, !">0 implementin' that order of =arch 0 , !">0 $as also valid and le'al. %ection > of Common$ealth )ct No. ! 0 empo$ers the Court of &ndustrial Relations of any Jud'e thereof to punish direct and indirect contempts as provided in Rule >* (no$ Rule #!) of the Rules of Court, under the same procedure and penalties provided therein. %ection 0 of Rule #! enumerates the acts $hich $ould constitute indirect contempt, amon' $hich is <disobedience or resistance to la$ful $rit, process, order, (ud'ment, or command of a court,< and the person 'uilty thereof can be punished after a $ritten char'e has been filed and the accused has been 'iven an opportunity to be heard. ,he last para'raph of said section provides. 4ut nothin' in this section shall be so construed as to prevent the court from issuin' process to brin' the accused party into court, or from holdin' him in custody pendin' such proceedin's. ,he provision authori?es the (ud'e to order the arrest of an alle'ed contemner (;rancisco, et al. v. :nri3ue?, L6# 81, =arch 2 , !"8*, "* Phil., > 0) and this, apparently, is the provision upon $hich respondent Jud'e 4autista relied $hen he issued the 3uestioned order of arrest. ,he contention of petitioner that the order of arrest is ille'al is un$arranted. ,he return6to6$or- order alle'edly violated $as $ithin the court7s (urisdiction to issue. %ection !* of Common$ealth )ct No. ! 0 provides that in cases brou'ht before the Court of &ndustrial Relations under %ection * of the )ct (referrin' to stri-es and loc-outs) the appeal to the %upreme Court from any a$ard, order or decision shall not stay the e5ecution of said a$ard, order or decision sou'ht to be revie$ed unless for special reason the court shall order that e5ecution be stayed. )ny a$ard, order or decision that is appealed is necessarily not final. Eet under %ection !* of Common$ealth )ct No. ! 0 that a$ard, order or decision, even if not yet final, is e5ecutory, and the stay of e5ecution is discretionary $ith the Court of &ndustrial Relations. &n other $ords, the Court of &ndustrial Relations, in cases involvin' stri-es and loc-outs, may compel compliance or obedience of its a$ard, order or decision even if the a$ard, order or decision is not yet final because it is appealed, and it follo$s that any disobedience or non6 compliance of the a$ard, order or decision $ould constitute contempt a'ainst the Court of &ndustrial Relations $hich the court may punish as provided in the Rules of Court. ,his po$er of the Court of &ndustrial Relations to punish for contempt an act of non6 compliance or disobedience of an a$ard, order or decision, even if not yet final, is a special one and is e5ercised only in cases involvin' stri-es and loc-outs. )nd there is reason for this special po$er of the industrial court because in the e5ercise of its (urisdiction over cases involvin' stri-es and loc-outs the court has to issue orders or ma-e decisions that are necessary to effect a prompt solution of the labor dispute that caused the stri-e or the loc-out, or to effect the prompt creation of a situation that $ould be most beneficial to the mana'ement and the employees, and also to the public C even if the solution may be temporary, pendin' the final determination of the case. /ther$ise, if the effectiveness of any order, a$ard, or decision of the industrial court in cases involvin' stri-es and loc-outs $ould be suspended pendin' appeal then it can happen that the coercive po$ers of the industrial court in the settlement of the labor disputes in those cases $ould be rendered useless and nu'atory. ,he +niversity points to %ection > of Common$ealth )ct No. ! 0 $hich provides that <)ny violation of any order, a$ard, or decision of the Court of &ndustrial Relations shall after such order, a$ard or decision has become final, conclusive and e*ecutory constitute contempt of court,< and contends that only the disobedience of orders that are final (meanin' one that is not appealed) may be the sub(ect of contempt proceedin's. @e believe that there is no inconsistency bet$een the above63uoted provision of %ection > and the provision of %ection !* of Common$ealth )ct No. ! 0. &t $ill be noted that %ection > spea-s of order, a$ard or decision that is e*ecutory. 4y the provision of %ection !* an order, a$ard or decision of the Court of &ndustrial Relations in cases involvin' stri-es and loc-outs are immediately e*ecutory, so that a violation of that order $ould constitute an indirect contempt of court.

@e believe that the action of the C&R in issuin' the order of arrest of )pril 2", !">0 is also authori?ed under %ection !" of Common$ealth )ct No. ! 0 $hich provides as follo$s. %:C. !". Im'lied condition in every contract of em'loyment.C&n every contract of employment $hether verbal or $ritten, it is an implied condition that $hen any dispute bet$een the employer and the employee or laborer has been submitted to the Court of &ndustrial Relations for settlement or arbitration pursuant to the provisions of this )ct . . . and pendin' a$ard, or decision by the Court of such dispute . . . the employee or laborer shall not stri-e or $al- out of his employment $hen so en(oined by the Court after hearin' and $hen public interest so re3uires, and if he has already done so, that he shall forth$ith return to it, upon order of the Court, $hich shall be issued only after hearin' $hen public interest so re3uires or $hen the dispute cannot, in its opinion, be promptly decided or settledB and if the employees or laborers fail to return to $or-, the Court may authori?e the employer to accept other employees or laborers. ) condition shall further be implied that $hile such dispute . . . is pendin', the employer shall refrain from acceptin' other employees or laborers, unless $ith the e5press authority of the Court, and shall permit the continuation in the service of his employees or laborers under the last terms and conditions e5istin' before the dispute arose. . . . ) violation by the employer or by the employee or laborer of such an order or the implied contractual condition set forth in this section shall constitute contempt of the Court of &ndustrial Relations and shall be punished by the Court itself in the same manner $ith the same penalties as in the case of contempt of a Court of ;irst &nstance. . . . @e hold that the C&R acted $ithin its (urisdiction $hen it ordered the arrest of the officers of the +niversity upon a complaint for indirect contempt filed by the )ctin' %pecial Prosecutor of the C&R in C&R Case J60 , and that order $as valid. 4esides those ordered arrested $ere not yet bein' punished for contemptB but, havin' been char'ed, they $ere simply ordered arrested to be brou'ht before the Jud'e to be dealt $ith accordin' to la$. @hether they are 'uilty of the char'e or not is yet to be determined in a proper hearin'. Let it be noted that the order of arrest dated )pril 2", !">0 in C&R Case J60 is bein' 3uestioned in Case D.R. No. L62!2#1 before this Court in a special civil action for certiorari. ,he +niversity did not appeal from that order. &n other $ords, the only 3uestion to be resolved in connection $ith that order in C&R Case J60 is $hether the C&R had (urisdiction, or had abused its discretion, in issuin' that order. @e hold that the C&R had (urisdiction to issue that order, and neither did it abuse its discretion $hen it issued that order. &n Case D.R. No. L62!*>2 the +niversity appealed from the order of Jud'e Jillanueva of the C&R in Case No. !!106=C, dated )pril >, !">0, 'rantin' the motion of the ;aculty Club to $ithdra$ its petition for certification election, and from the resolution of the C&R en banc, dated June 8, !">0, denyin' the motion to reconsider said order of )pril >, !">0. ,he 'round of the ;aculty Club in as-in' for the $ithdra$al of that petition for certification election $as because the issues involved in that petition $ere absorbed by the issues in Case *!6&P). ,he +niversity opposed the petition for $ithdra$al, but at the same time it moved for the dismissal of the petition for certification election. &t is contended by the +niversity before this Court, in D.R. L62!*>2, that the issues of employer6employee relationship bet$een the +niversity and the ;aculty Club, the alle'ed status of the ;aculty Club as a labor union, its ma(ority representation and desi'nation as bar'ainin' representative in an appropriate unit of the ;aculty Club should have been resolved first in Case No. !!106=C prior to the determination of the issues in Case No. *!6&P), and, therefore, the motion to $ithdra$ the petition for certification election should not have been 'ranted upon the 'round that the issues in the first case $ere absorbed in the second case. @e believe that these contentions of the +niversity in Case D.R. No. L62!*>2 have been sufficiently covered by the discussion in this decision of the main issues raised in the principal case, $hich is Case D.R. No. L62!2#1. )fter all, the +niversity $anted C&R Case !!106=C dismissed, and the $ithdra$al of the petition for certification election had in a $ay produced the situation desired by the +niversity. )fter considerin' the ar'uments adduced by the +niversity in support of its petition for certiorari by $ay of appeal in Case D.R. No. L62!2#1, @e hold that the C&R did not commit any error $hen it 'ranted the $ithdra$al of the petition for certification election in Case No. !!106=C. ,he principal case before the C&R is Case No. *!6&P) and all the 3uestions relatin' to the labor disputes bet$een the +niversity and the ;aculty Club may be threshed out, and decided, in that case. &n Case D.R. No. L62!8 the +niversity appealed from the order of the C&R of =arch 0 , !">0, issued by Jud'e 4autista, and from the resolution of the C&R en banc promul'ated on June 21, !">0, denyin' the motion for the reconsideration of that order of =arch 0 , !">0, in C&R Case No. *!6&P). @e have already ruled that the C&R has (urisdiction to issue that order of =arch 0 , !">0, and that order is valid, and @e, therefore, hold that the C&R did not err in issuin' that order of =arch 0 , !">0 and in issuin' the resolution promul'ated on June 21, !">0 (althou'h dated =ay #, !">0) denyin' the motion to reconsider that order of =arch 0 , !">0. &N J&:@ /; ,A: ;/R:D/&ND, the petition for certiorari and prohibition $ith preliminary in(unction in Case D.R. No. L62!2#1 is dismissed and the $rits prayed for therein are denied. ,he $rit of preliminary in(unction issued in Case D.R. No. L62!2#1 is dissolved. ,he orders and resolutions appealed from, in Cases Nos. L62!*>2 and L62!8 , are affirmed, $ith costs in these three cases a'ainst the petitioner6appellant ;eati +niversity. &t is so ordered.

G.R. No. 146264

;'%ruary 14, 2553

<UISU.1ING, J.:

N!K IN0ERNA0I NAL KNI0,EAR C R/ RA0I N /9ILI//INES an"@or CA09! NG, 'etitioners, vs. NA0I NAL LA1 R RELA0I NS C ..ISSI N an" VIRGINIA .. /U1LIC , res'ondents. &n this petition for revie$, petitioners NE2 &nternational 2nit$ear Corporation Philippines (henceforth NE2, for brevity) and its mana'er, Cathy N', assail the resolution! dated %eptember !8, 2 of the Court of )ppeals in C)6D.R. %P No. > 8*2, $hich dismissed their petition for certiorari for non6compliance $ith %ection !, Rule >8 of the !""# Rules of Civil Procedure. )lso assailed is the appellate courtFs resolution2 of 9ecember 8, 2 , $hich denied the motion for reconsideration. ,he facts, as 'leaned from the findin's of the Labor )rbiter as affirmed by the National Labor Relations Commission (NLRC), sho$ that. /n ;ebruary 1, !""8, herein petitioner NE2 hired respondent Jir'inia Publico as a se$er. +nder the terms and conditions of her employment, Publico $as paid on a piece6rate basis, but re3uired to $or- from 1. ).=. to !2. midni'ht. /n the avera'e, she earned P!18. daily. )t about ! . P.=. of =ay #, !""#, Publico re3uested that she be allo$ed to leave the $or- place early, as she $as not feelin' $ell due to a bout of influen?a. Permission $as refused but nonetheless, Publico $ent home. ,he follo$in' day, Publico called up her employer and notified mana'ement that she $as still recoverin' from her ailment. /n =ay ", !""#, Publico reported for $or-. ,o her mortification and surprise, ho$ever, the security 'uard prevented her from enterin' the NE2 premises, alle'edly on mana'ementFs order. %he be''ed to be allo$ed inside, but the 'uard remained adamant. &t $as only $hen Publico declared that she $ould (ust complete the unfinished $or- she had left on =ay # that the 'uard let her in. /nce inside the factory, Publico re3uested to see the o$ner, one %tephen N'. Aer re3uest $as declined. %he $as instead as-ed to come bac- the follo$in' day. /n =ay ! , !""#, Publico returned to NE2 as instructed. )fter $aitin' for three and half (0R) hours, she $as finally able to see %tephen N'. @hen she in3uired $hy she $as barred from reportin' for $or-, =r. N' told her she $as dismissed due to her refusal to render overtime service. )''rieved, private respondent filed a complaint for ille'al dismissal a'ainst petitioner corporation and its mana'er, petitioner Cathy N', doc-eted as NLRC NCR Case No. 6 >6 0"286"#. 4efore the Labor )rbiter, petitioners predictably had a different version of the story. )lle'edly, they too- the pains to verify $hy Publico did not report for $or- on =ay #, !""# and found out that her husband did not allo$ her to $or- at ni'ht. )s ni'ht $or- is a must in their line of business, particularly $hen there are rush orders, petitioners claimed that 'iven PublicoFs failure to render overtime $or-, they $ere left $ith no other recourse but to fire her. /n =arch !", !""1, the Labor )rbiter held PublicoFs dismissal to be ille'al, disposin' as follo$s. @A:R:;/R:, the respondents are hereby ordered to reinstate the complainant to her former position $ith full bac-$a'es from the date her salary $as $ithheld until she is actually reinstated, $hich amounted to P8 ,!>1.0 5 5 5. ,he respondents are, li-e$ise, assessed the sum of P8, !>.10 representin' ! S of the amount a$arded as attorneyFs fees. ,he rest of the claims are dismissed for lac- of merit. %/ /R9:R:9.0 /n appeal, the NLRC, in a resolution* dated =ay !#, 2 , affirmed the decision of the Labor )rbiter in toto.

&n due time, petitioners impu'ned the NLRC decision by $ay of a special civil action of certiorari filed before the Court of )ppeals, doc-eted as C)6D.R. %P No. > 8*2. Petitioners ascribed 'rave abuse of discretion amountin' to lac- or e5cess of (urisdiction to public respondent NLRC for affirmin' the rulin' of the Labor )rbiter. &n its resolution of %eptember !8, 2 , the appellate court dismissed the petition outri'ht. ,he Court of )ppeals pointed out that there $as non6compliance $ith %ection ! of Rule >8 of the !""# Rules of Civil Procedure as the petition $as merely accompanied by a certified 5ero5 copy of the assailed NLRC decision, instead of a certified true copy thereof as re3uired by the Rules of Court.8 ;urthermore, petitioners failed to attach the other pleadin's and documents pertinent and material to their petition, such as the partiesF position papers, their evidence and the motion for reconsideration in contravention of the said rule.>

Petitioners duly moved for reconsideration, e5plainin' that they had re3uested for a certified true copy of the NLRCFs decision but since the ori'inal NLRC decision $as printed on onions-in $as not le'ible, the NLRC itself photocopied the resolution and certified it after$ards. )s proof of payment of petitionersF re3uest for a certified true copy of the NLRC decision, petitioners attached a copy of the official receipts issued by the NLRC, $hich described the nature of the entry as <C:R,. ,R+: C/PE.<# Petitioners, li-e$ise, appended in their motion copies of pertinent pleadin's and documents not previously attached in their petition. /n 9ecember 8, 2 , the appellate court denied petitionersF motion for reconsideration.1

Aence this petition for revie$. 4efore us, petitioners submit the follo$in' issues for our resolution. & $hether or not the court of appeals should have 'iven due course to the petition for certiorari. && $hether or not there e5ists evidence on record to $arrant the rulin' that complainant $as ille'ally dismissed, and corollary thereto, $hether or not there is le'al (ustification to a$ard bac-$a'es and order reinstatement. &&& $hether or not there $as 'rave abuse of discretion on the part of the public respondent nlrc so as to (ustify a reversal of its resolution% dated may !#, 2 and (une 0 , 2 ." /nly t$o issues need resolution, one havin' to do $ith ad(ective la$ and the other $ith substantial la$, namely. (!) 9id the Court of )ppeals commit a reversible error in dismissin' C)6D.R. %P No. > 8*2 on purely technical 'rounds, i.e., that the attached copy of the NLRC decision is a mere photocopy of the ori'inal decisionB and (2) 9id the Court of )ppeals err in refusin' to rule on the correctness of the NLRCFs findin's that private respondent $as ille'ally dismissedO /n the first issue, petitioners contend that they have substantially complied $ith the re3uirements of %ection !, Rule >8, hence, in the interests of (ustice and e3uity, the Court of )ppeals should have 'iven due course to their special civil action for certiorari. Private respondent, on the other hand, maintains that petitionersF $anton disre'ard of the Rule $arrant the outri'ht dismissal of their petition. %he adds that the present petition raises factual issues that the Court cannot pass upon at the first instance. %ection ! of Rule >8,! !""# Rules of Civil Procedure, re3uires that the petition shall be accompanied by a certified true copy of the (ud'ment or order sub(ect thereof, to'ether $ith copies of all pleadin's and documents relevant and pertinent thereto. ,he precursor of the Revised Rules of Civil Procedure, )dministrative Circular No. 06">, $hich too- effect on June !, !"">, instructs us $hat a <certified true copy< is. 1. The "certified true copy" thereof shall be such other copy furnished to a party at his instance or in his behalf, duly authenticated by the authorized officers or representatives of the issuing entity as hereinbefore specified. 555 3. The certified true copy must further comply ith all the regulations therefor of the issuing entity and it is the authenticated original of such certified true copy, and not a mere !ero! copy thereof, hich shall be utilized as an anne! to the petition or other initiatory pleading."#mphasis supplied.$ 555 )pplyin' the precedin' 'uidepost in the present case, the disputed document althou'h stamped as <certified true copy< is not an authenticated ori'inal of such certified true copy, but only a 5ero5 copy thereof, in contravention of para'raph 0 of the above63uoted 'uidelines. Aence, no error may be ascribed to the Court of )ppeals in dismissin' the petition for certiorari outri'ht pursuant to para'raph 8 of )dministrative Circular No. 06">, $hich provides.

8. &t shall be the duty and responsibility of the party usin' the documents re3uired by Para'raph (0) of Circular No. !611 to verify and ensure compliance $ith all the re3uirements therefor as detailed in the precedin' para'raphs.;a#+ur' (o "o &o &)a++ r'&u+( #n ()' r'A'6(#on o? &u6) ann'B'& an" ()' "#&*#&&a+ o? ()' 6a&'. Su%&'Cu'n( 6o*D+#an6' &)a++ no( >arran( any r'6on&#"'ra(#on un+'&& ()' 6our( #& ?u++y &a(#&?#'" ()a( ()' non-6o*D+#an6' >a& no( #n any >ay a((r#%u(a%+' (o ()' Dar(y, "'&D#(' "u' "#+#$'n6' on )#& Dar(, an" ()a( ()'r' ar' )#$)+y Au&(#?#a%+' an" 6o*D'++#n$ r'a&on& ?or ()' 6our( (o *a=' &u6) o()'r "#&Do&#(#on a& #( *ay "''* Au&( an" 'Cu#(a%+'. (:mphasis supplied.) ,he members of this Court are not unmindful that in e5ceptional cases and for compellin' reasons, $e have disre'arded similar procedural defects in order to correct a patent in(ustice made. Ao$ever, petitioners here have not sho$n any compellin' reason for us to rela5 the rule. Petitioners are hereby reminded that the ri'ht to file a special civil action of certiorari is neither a natural ri'ht nor a part of due process. ) $rit of certiorari is a prero'ative $rit, never demandable as a matter of ri'ht, never issued e5cept in the e5ercise of (udicial discretion.!! Aence, he $ho see-s a $rit of certiorari must apply for it only in the manner and strictly in accordance $ith the provisions of the la$ and the Rules. ,o avoid further delay in resolvin' the present controversy, $e no$ come to the second issue. Petitioners contend that private respondentFs refusal to render ni'ht $or- is tantamount to abandonment of duties $hich constitutes a (ust 'round for termination of service. ,hey aver that the Labor )rbiter 'ravely erred in a$ardin' bac-$a'es to private respondent, as there $as no ille'al dismissal. Petitioners alle'e that mana'ement did not terminate her services, but in fact as-ed her to return to $or- durin' the preliminary conferences. Aence, it $ould be the hei'ht of in(ustice to a$ard bac-$a'es for $or-, $hich $as never rendered throu'h private respondentFs o$n choice. Petitioners add that they cannot be held solidarily liable in this case as there $as neither malice nor bad faith. PetitionersF ar'uments fail to persuade us. Petitioners raise factual 3uestions $hich are improper in a petition for revie$ on certiorari. ;indin's of facts of the NLRC, particularly in a case $here the NLRC and the Labor )rbiter are in a'reement, are deemed bindin' and conclusive upon this Court.!2 Aence, petitionersF bare alle'ations of abandonment cannot stand the uns$ervin' conclusion by both 3uasi6(udicial a'encies belo$ that private respondent $as unla$fully dismissed. @e find no reason to deviate from the consistent findin's of the Labor )rbiter and the NLRC that there $as no basis to find that Jir'inia abandoned her $or-. &ndeed, factual findin's of the NLRC affirmin' those of the Labor )rbiter, both bodies bein' deemed to have ac3uired e5pertise in matters $ithin their (urisdictions, $hen sufficiently supported by evidence on record, are accorded respect if not finality, and are considered bindin' on this Court.!0 )s lon' as their decisions are devoid of any unfairness or arbitrariness in the process of their deduction from the evidence proffered by the parties, all that is left is for the Court to stamp its affirmation and declare its finality. No reversible error may thus be laid at the door of the Court of )ppeals $hen it refused to rule that the NLRC committed a 'rave abuse of discretion amountin' to $ant or e5cess of (urisdiction in holdin' that private respondent $as ille'ally dismissed. )nent petitionersF assertion that they cannot be solidarily liable in this case as there $as no malice or bad faith on their part has no le' to stand on. @hat the Court finds apropos is our dis3uisition in ).C. Ransom Labor +nion6CCL+ v. NLRC,!* $hich held that since a corporation is an artificial person, it must have an officer $ho can be presumed to be the employer, bein' the <person actin' in the interest of the employer.< &n other $ords the corporation, in the technical sense only, is the employer. &n a subse3uent case, $e ordered the corporate officers of the employer corporation to pay (ointly and solidarily the private respondentsF monetary a$ard. !8 =ore recently, a corporation and its president $ere directed by this Court to (ointly and severally reinstate the ille'ally dismissed employees to their former positions and to pay the monetary a$ards.!> &n this case Cathy N', admittedly, is the mana'er of NE2. Conformably $ith our rulin' in ). C. Ransom, she falls $ithin the meanin' of an <employer< as contemplated by the Labor Code,!# $ho may be held (ointly and severally liable for the obli'ations of the corporation to its dismissed employees. Pursuant to prevailin' (urisprudence, Cathy N', in her capacity as mana'er and responsible officer of NE2, cannot be e5onerated from her (oint and several liability in the payment of monetary a$ard to private respondent. ,9ERE; RE, the instant petition is 9:N&:9. ,he assailed resolutions of the Court of )ppeals dated %eptember !8, 2 9ecember 8, 2 , are hereby );;&R=:9. Costs a'ainst petitioners. %/ /R9:R:9. G.R. No&. L-22951 an" L-22952 January 31, 1964 1ENG7 N, J./., J.: and

ALLIE- ;REE , RKERSE UNI N 2/LU.3, petitioner, vs.C ./AFIA .ARI0I.A, .ana$'r J SE C. 0EVES, an" C UR0 66666666666666666666666666666 G.R. No. L-22941 January 31, 1964

; IN-US0RIAL RELA0I NS, respondents.

C ./AFIA .ARI0I.A an" .ana$'r J SE C. 0EVES, petitioners, vs. ALLIE- ;REE, RKERSE 2/LU.3 an" C UR0 ; IN-US0RIAL RELA0I NS, respondents.

L622"8! and 22"82. Jicente ). Rafael and )ssociates for petitioner. Rafael 9in'lasan for respondents. =ariano 4. ,uason for respondent Court of &ndustrial Relations. L622"#!. Rafael 9in'lasan for petitioner. Jicente ). Rafael and )ssociates for respondents. =ariano 4. ,uason for respondent Court of &ndustrial Relations. ,he three cases before this Court are the respective appeals separately ta-en by the parties hereto from an order! of the Court of &ndustrial Relations en banc affirmin' its trial (ud'e7s decision, rendered on November *, !">0, in C&R Case !#86=C and C&R Case *2>6+LP. ,hus L622"#! is the appeal of ,A I$I,A2 in C&R Case !#86=CB L622"82 is AF.U6s appeal in the same caseB and L622"8! refers to AF.U6s0 appeal in C&R Case *2>6+LP. %ince these cases $ere (ointly tried and decided in the court a 7uo and they involve the same fundamental issue C the presence or absence of employer6employee relationship C they are (ointly considered herein. ,A I$I,A is a local corporation en'a'ed in the shippin' business. ,eves is its branch mana'er in the port of &li'an City. )nd AF.U is duly re'istered le'itimate labor or'ani?ation $ith 228 members. /n )u'ust !!, !"82, ,A I$I,A, throu'h ,eves, entered into a C/!$ AC$ * $ith AF.U the terms of $hich @e reproduce. C )RR)%,R: )N9 %,:J:9/R&ND C/!$ AC$ C 2N/@ )LL =:N 4E ,A:%: PR:%:N,%. ,his C/!$ AC$ made and e5ecuted this !!th day of )u'ust, !"82, in the City of &li'an, Philippines, by and bet$een the C/=P)T&) ,A I$I,A &li'an 4ranch, represented by its 4ranch =ana'er in &li'an City, and the )LL&:9 ;R:: @/R2:R%7 +N&/N, a duly authori?ed labor union, represented by its President. @&,N:%%:,A. !. ,hat the CompaIia ,A I$I,A hereby en'a'e the services of the )llied ;ree @or-ers7 +nion to do and perform all the $or- of stevedorin' and arrastre services of all its vessels or boats callin' in the port of &li'an City, be'innin' )u'ust !2, !"82. 2. ,hat the CompaIia ,A I$I,A shall not be liable for the payment of the services rendered by the )llied ;ree @or-ers7 +nion, for the loadin', unloadin' and deliveries of car'oes as same is payable by the o$ners and consi'nees of car'oes, as it has been the practice in the port of &li'an City. 0. ,hat the )llied ;ree @or-ers7 +nion shall be responsible for the dama'es that may be caused to the car'oes in the course of their handlin'. *. ,hat this C/!$ AC$ is 'ood and valid for a period of one (!) month from )u'ust !2, !"82, but same may be rene$ed by a'reement of the partiesB ho$ever CompaIia ,A I$I,Areserves the ri'ht to revo-e this C/!$ AC$ even before the e5piration of the term, if and $hen the )llied ;ree @or-ers7 +nionfails to render 'ood service. &N @&,N:%% @A:R:/;, $e hereunto si'n this presents in the City of &li'an, Philippines, this !!th day of )u'ust, !"82. (%D9) %)LJ)9/R ,. LL+CA President )llied ;ree @or-ers7 +nion &li'an City %&DN:9 &N ,A: PR:%:NC: /;. !. (%D9) J/%: C+:,/ 2. (%D9) %:RD&/ /4)CA. 9urin' the first month of the e5istence of the C/!$ AC$ , AF.U rendered satisfactory service. %o, ,A I$I,A, throu'h ,eves, verbally rene$ed the same. ,his harmonious relations bet$een ,A I$I,A and AF.U lasted up to the latter part of !"80 $hen the (%D9) J/%: C. ,:J:% 4ranch =ana'er CompaIia =aritima &li'an City

former complained to the latter of unsatisfactory and inefficient service by the laborers doin' the arrastre and stevedorin' $or-. ,his deterioratin' situation $as admitted as a fact by AF.U6spresident. ,o remedy the situation since ,A I$I,A6s business $as bein' adversely affected C ,eves $as forced to hire e5tra laborers from amon' <stand6by< $or-ers not affiliated to any union to help in the stevedorin' and arrastre $or-. ,he $a'es of these e5tra laborers $ere paid by ,A I$I,A throu'h separate vouchers and not byAF.U. =oreover, said $a'es $ere not char'ed to the consi'nees or o$ners of the car'oes. /n July 20, !"8*, AF.U presented to ,A I$I,A a $ritten proposal8 for a collective bar'ainin' a'reement. ,his demand embodied certain terms and conditions of employment different from the provisions of theC/!$ AC$ . No reply $as made by ,A I$I,A. /n )u'ust >, !"8*, AF.U instituted proceedin's in the &ndustrial Court> prayin' that it be certified as the sole and e5clusive bar'ainin' a'ent in the bar'ainin' unit composed of all the laborers doin' the arrastre and stevedorin' $or- in connection $ith ,A I$I,A6s vessels in &li'an City. ,A I$I,A ans$ered, alle'in' lac- of employer6employee relationship bet$een the parties. /n )u'ust 2*, !"8*, ,A I$I,A informed AF.U of the termination of the C/!$ AC$ because of the inefficient service rendered by the latter $hich had adversely affected its business. ,he termination $as to ta-e effect as of %eptember !, !"8*. ,A I$I,A then contracted $ith the &li'an %tevedorin' +nion for the arrastre and stevedorin' $or-. ,he latter a'reed to perform the $or- sub(ect to the same terms and conditions of the C/!$ AC$ . ,he ne$ a'reement $as to be carried out on %eptember !, !"8*. /n )u'ust 2>, !"8*, upon the instance of AF.U, ,A I$I,A found itself char'ed before the &ndustrial Court# of unfair labor practices under %ec. *(a), (!), (0), (*) and (>) of Rep. )ct No. 1#8. ,A I$I,A ans$ered, a'ain denyin' the employer6employee relationship bet$een the parties. /n %eptember !, !"8*, members of AF.U, to'ether $ith those of the =indanao @or-ers )lliance C a sister union C formed a pic-et line at the $harf of &li'an City, thus preventin' the &li'an %tevedorin' +nion from carryin' out the arrastre and stevedorin' $or- it contracted for.1 ,his pic-et lasted for nine days. /n %eptember ", !"8*, ,A I$I,A filed an action" to rescind the C/!$ AC$ 0 en(oin AF.U members from doin' arrastre and stevedorin' $or- in connection $ith its, vessels, and for recovery of dama'es a'ainst AF.Uand its officers. &ncidentally, this civil case has been the sub(ect of three proceedin's already $hich have reached this Court. ,he first ! involved a preliminary in(unction issued therein on %eptember ", !"8*, by the trial court prohibitin' AF.U from interferin' in any manner $ith the loadin' and unloadin' of car'oes from ,A I$I,A6svessels. ,his in(unction $as lifted that very evenin' upon the filin' of a counter bond by AF.U. %ubse3uently, a motion to dissolve said counterbond $as filed by ,A I$I,A but the hearin' on this incident $as en(oined by +s on =arch !8, !"88, upon the institution of the petition for prohibition and in(unction in said L611#>. !! =ean$hile,AF.U members6laborers $ere able to continue the arrastre and stevedorin' $or- in connection $ith ,A I$I,A6svessels. /n 9ecember 8, !"> , the C;& decision in the civil case $as promul'ated. &t ordered the rescission of theC/!$ AC$ and permanently en(oined AF.U members from performin' $or- in connection $ith ,A I$I,A6svessels. AF.U then filed its notice of appeal, appeal bond and record on appeal. !2 ,he subse3uent incidents thereto 'ave rise to the t$o other proceedin's $hich have previously reached +s here. /n January >, !">!, upon motion of ,A I$I,A ,an order of e5ecution pendin' appeal and a $rit of in(unction a'ainst AF.U $as issued by the trial court in the civil case. ,his enabled ,A I$I,A to en'a'e the services of the =indanao )rrastre %ervice to do the arrastre and stevedorin' $or- on January 1, !">!. Ao$ever, AF.U filed a petition for certiorari, in(unction and prohibition !0 here and on January !1, !">!, $as able to secure a $rit of preliminary in(unction orderin' the maintenance of the status 7uo prior to January >, !">!. ,hus, after January !1, !">!, AF.U laborers $ere a'ain bac- doin' the same $or- as before. ,he third incident that reached +% !* involved an order of the same trial court in the same civil case, dated January !!, !">!, $hich amended some clerical errors in the ori'inal decision of 9ecember 8, !"> . +pon motion of ,A I$I,A, the trial court, on =arch 2*, !">2, issued an order for the e5ecution of the decision of January !!, !">!, since AF.U did not appeal therefrom, and on =arch 0!, !">2, a $rit of e5ecution oustin' the 228 AF.Umembers6laborers from their $or- in connection $ith the loadin' and unloadin' of car'oes $as issued and a levy on e5ecution upon the properties of AF.U $as effected. )ccordin'ly, on )pril !, !">2, ,A I$I,A $as a'ain able to en'a'e the services of the =indanao )rrastre %ervice. /n )pril !>, !">2, upon the institution of the petition for certiorari, in(unction, prohibition and mandamus, a preliminary in(unction $as issued by +s a'ainst the orders of =arch 2* and 0!, !">2. 4ut then, on =ay !>, !">2, upon motion of ,A I$I,A this preliminary in(unction $as lifted by +s insofar as it related to the e5ecution of the order oustin' the AF.U laborers from the stevedorin' and arrastre $or- in connection $ith the ,A I$I,Avessels. !8 %uch then $as the status of thin's. /n November *, !">0, after almost ! years of hearin' the t$o cases (ointly, the &ndustrial Court finally rendered its decision. ,he dispositive part provided.

&N J&:@ /; )LL ,A: ;/R:D/&ND C&RC+=%,)NC:%, the complaint of the union for unfair labor practices a'ainst the CompaIia ,A I$I,A andMor its a'ent Jose C. ,eves and the &li'an %tevedorin' +nion andMor %er'io /bach is hereby dismissed for lac- of substantial evidence and merit. &n pursuance of the provisions of %ection !2 of Republic )ct 1#8 and the Rules of this court on certification election, the Aonorable, the %ecretary of Labor or any of his authori?ed representative is hereby re3uested to conduct certification election amon' all the $or-ers andMor stevedores $or-in' in the $harf of &li'an City $ho are performin' stevedorin' and arrastre service aboard CompaIia ,A I$I,A vessels doc-in' at &li'an City port in order to determine their representative for collective bar'ainin' $ith the employer, $hether their desire to be represented by the petitioner )llied ;ree @or-ers +nion or neither GsicHB and upon termination of the said election, the result thereof shall forth$ith be submitted to this court for further consideration. ,he union present payroll may be utili?ed in determinin' the 3ualified voters, $ith the e5clusion of all supervisors. %/ /R9:R:9. )s already indicated, the fundamental issue involved in these cases before +s consists in $hether there is an employer6employee relationship bet$een ,A I$I,A, on the one hand, and AF.U andMor its members6laborers $ho do the actual stevedorin' and arrastre $or- on the other hand. ,A: +N;)&R L)4/R PR)C,&C: C)%: (L622"8! U GC&R Case *2>6+LPH) Petitioner AF.U6s proposition is that the court a 7uo erred (!) in concludin' that ,A I$I,A had not refused to bar'ain collectively $ith it, as the ma(ority unionB (2) in not findin' that ,A I$I,A had committed acts of discrimination, interferences and coercions upon its members6laborers, and (0) in concludin' that the C/!$ AC$may not be interferred $ith even if contrary to la$ or public policy. &t is true that ,A I$I,A admits that it did not ans$er AF.U6s proposal for a collective bar'ainin' a'reement. ;rom this it does not necessarily follo$ that it is 'uilty of unfair labor practice. +nder the la$ !> the duty to bar'ain collectively arises only bet$een the <employer< and its <employees<. @here neither party is an <employer< nor an <employee< of the other, no such duty $ould e5ist. Needless to add, $here there is no duty to bar'ain collectively the refusal to bar'ain violates no ri'ht. %o, the 3uestion is. +nder the C/!$ AC$ 0 $as ,A I$I,A the <employer< and AF.U andMor its members the <employees< $ith respect to one anotherO ,he court a 7uo held that under the C/!$ AC$ , AF.U $as an independent contractor of ,A I$I,A. ,his conclusion $as based on the follo$in' findin's of fact, $hich @e can no lon'er disturb, stated in the C&R decision. #. ... $%e 'etitioner union o'erated as a labor contractor under t%e so)called BcaboB systemB and as such it has a complete set of officers and office personnel (:5hs. <;< and <;6!<) and its or'ani?ational structure includes the follo$in'. Deneral President, $ith the follo$in' under him C one vice6president, le'al counsel, 'eneral treasurer, 'eneral mana'er and the board of directors. +nder the 'eneral mana'er is the secretary, the auditor, and the office staff composin' of the 'eneral foreman, 'eneral chec-er, 'eneral time-eeper, and the respective subordinates li-e assistant foreman, capata?, assistant 'eneral chec-er, field chec-er, office time-eeper, and field time-eeper all a''ointed by t%e "eneral mana"er of t%e union and are 'aid in accordance -it% t%e union 'ayroll e*clusively 're'ared by t%e union in t%e office. (%ee t.s.n. pp. 0260>, June ", !"> B pp. #161 , ;ebruary !>, !">!B pp. 2>621, )u'ust ", !"> ). $%e 'ayrolls -%ere laborers are listed and 'aid -ere 're'ared by t%e union itself -it%out t%e intervention or control of t%e res'ondent com'any andCor its a"ent at Ili"an City. $%e res'ondent never %ad any 8no-led"e of t%e individual names of laborers andCor -or8ers listed in t%e union 'ayroll or in t%eir roster of members%i'. 1. $%e union en"a"ed t%e services of t%eir members in underta8in" t%e -or8 of arrastre and stevedorin"either to haul shippers7 'oods from their $arehouses in &li'an City to the ,A I$I,A boat or from the boat to the different consi'nees. $%e c%ar"es for suc% service -ere 8no-n by t%e union and collected by t%em t%rou"% t%eir bill collector. ,his is sho$n by the preparation of the union forms -no$n as <conduci< or delivery receipts. ,hese <conduci< or receipts contain informations as to the number andMor volume of car'oes handled by the union, the invoice number, the name of the vessel and the number of bills of ladin' coverin' the car'oes to be delivered. ,hose delivery receipts are different and separate from the bills of ladin' and delivery receipts issued by the company to the consi'nees or shippers. Car'oes carried from the $arehouses to the boat or from the boat to the consi'nees $ere al$ays accompanied by the union chec-er $ho hand6carry the <conduci<. /nce "oods are delivered to t%eir destination t%e union t%rou"% its bill collectors 're'are t%e bills of collection and t%e c%ar"es t%ereon are collected by t%e union bill collectors -%o are em'loyees of t%e union and not of t%e res'ondent. ,he respondent had no intervention $hatsoever in the collection of those char'es as the same are clearly indicated and described in the labor C/!$ AC$ , :5hibit <)<. ,here $ere, ho$ever, instances $hen the respondents $ere re3uested to help the union in the collection of char'es for services rendered by members of the union $hen fertili?ers and 'asoline drums $ere loaded aboard the CompaIia ,A I$I,A boats. ,his $as necessary in order to facilitate the collection of frei'ht and handlin' char'es from the 'overnment for auditin' purposes. @hen car'oes are to be loaded, the shipper usually notifies the petitioner union $hen to load their car'oes aboard CompaIia,A I$I,A boats callin' in the port of &li'an CityB and $hen a boat doc-s in said port, the union underta-es to haul the said shipper7s 'oods to the boat. In doin" t%is -or80 t%e union em'loys t%eir o-n truc8s or ot%er ve%icles or conveyance from s%i''er6s -are%ouse to t%e boat or vice)versa. $%e res'ondent %as no truc8 of any 8ind for

t%e service of %aulin" car"oes because suc% service is included in t%e C/!$ AC$ e*ecuted bet-een t%e 'arties. (%ee :5h. <)<). ". $%e union members -%o -ere %ired by t%e union to 'erform arrastre and stevedorin" -or8 on res'ondents6 vessels at Ili"an 'ort -ere bein" su'ervised and controlled by t%e "eneral foreman of t%e 'etitioner union or by any union assistant or ca'ata+ res'onsible for t%e e*ecution of t%e labor C/!$ AC$$hen performin' arrastre andMor stevedorin' $or- aboard vessels of the CompaIia ,A I$I,A doc-in' at &li'an City. ,he foreman assi'ned their laborers to perform the re3uired $oraboard vessels of the respondent. ;or instance, $hen a boat arrives, the 'eneral foreman re3uests the car'o report from the chief mate of the vessel in order to determine $here the car'oes are located in the hold of the boat and to -no$ the destination of these car'oes. All t%e laborers andCor -or8ers %ired for said -or8 are union members and are only res'onsible to t%eir immediate c%ief -%o are officers andCor em'loyees of t%e union. ,he respondent firm have their o$n separate representatives li-e chec-ers $ho e5tend aid to the union officers and members in chec-in' the different car'oes unloaded or loaded aboard vessels of the CompaIia ,A I$I,A. $%ere -ere no instances -%ere offices and em'loyees of t%e res'ondent Com'aAia ,A I$I,A andCor its a"ent %ad interferred in t%e "ivin" of instructions to t%e laborers 'erformin" t%e arrastre andCor stevedorin" -or8 eit%er aboard vessels or at t%e -%arf of Ili"an City. As contractor0 t%e union does not receive instructions as to -%at to do0 %o- to do0 and -or8s -it%out s'ecific instructions. $%ey %ave no fi*ed %ours of -or8 re7uired by t%e ,A I$I,A. ! . @hile car'oes $ere in transit either from the $arehouse to the boat or from the boat to the different consi'nees, any losses or dama'es caused $ith the said car'oes $ere char'ed to the account of the unionB and the union li-e$ise imposed the penalty or fine to any employee $ho caused or committed the dama'es to car'oes in transit. /t%er disci'linary measures im'osed on laborers 'erformin" t%e said -or8 -ere e*ercised by t%e "eneral foreman of t%e union -%o %as blan8et aut%ority from t%e union "eneral mana"er to e*ercise disci'linary control over t%eir members -%o -ere assi"ned to 'erform t%e -or8 in a "rou' of laborers assi"ned by t%e union to 'erform loadin" or unloadin" car"oes -%en a Com'aAia ,A I$I,A boat doc8ed at Ili"an City. $%e res'ondents %ave not at any time interferred in t%e im'osition of disci'linary action u'on t%e laborers -%o are members of t%e union. In one instance0 under t%is situation0 t%e 'resident of t%e union %imself dismissed one inefficient laborer found to %ave been 'erformin" inefficient service at t%e time (t.s.n. pp. !#6!1, ;ebruary !8, !">!). 555 555 555

!0. :rrin' laborers andMor $or-ers $ho are affiliates of the union $ere directly responsible to the union and never to the respondent. es'ondent cannot0 t%erefore0 disci'line andCor dismiss t%ese errin" -or8ers of t%e union. (:mphasis supplied) )nd in absolvin' ,A I$I,A of the unfair labor char'e on this point, the court a 7uo concluded. ;rom the fore'oin' circumstances and findin's, the Court is of the opinion that no substantial evidence has been presented to sustain the char'e of unfair labor practice acts as alle'ed to have been committed by herein respondent. $%e Court finds no interference in t%e union activities0 if any0 of t%e members of t%e Allied Free .or8ers Union as t%ese 'ersons en"a"ed in t%e stevedorin" and arrastre service -ere em'loyed by t%e Allied Free .or8ers Union as inde'endent contractor sub@ect to t%e terms and conditions of t%eir t%en e*istin" labor C/!$ AC$ &*%ibit BAB. ,o construe the C/!$ AC$ other$ise $ould tend to disre'ard the ri'hts and privile'es of the parties intended by them in their C/!$ AC$ . (:5hibit <)<). ,his Court believes that it may not interfere in the implementation of the said labor C/!$ AC$ in the absence of abuse by one party to the pre(udice of the other. ... Furt%er0 t%e Court finds t%at t%e 'etitioner0 aside from its labor C/!$ AC$ (#ee &*%ibit BAB) -it% t%e res'ondent Com'aAia ,A I$I,A also %as ot%er labor contracts -it% ot%er s%i''in" firms on t%e stevedorin" and arrastre -or8D and t%at t%is C/!$ AC$ obli"ated t%e 'etitioner as an inde'endent labor contractor to underta8e t%e arrastre and stevedorin" service on Com'aAia ,A I$I,A boats doc8in" at Ili"an City Port. ,he petitioner is an independent contractor as defined in the C/!$ AC$ :5hibit <)< and in the evidence submitted by the parties. <)n independent contractor is one $ho, in renderin' services, e5ercises an independent employment or occupation and represents the $ill of his employer only as to the results of his $or- and not as to the means $hereby it is accomplishedB one $ho e5ercisin' an independent employment, contracts to do a piece of $or- accordin' to his o$n methods, $ithout bein' sub(ect to the control of his employer e5cept as to the result of his $or-B and $ho en'a'ed to perform a certain service for another, accordin' to his o$n manner and methods, free from the control and direction of his employer in all matters connected $ith the performance of the service e5cept as to the result of the $or-.< (see 8> C.J.%. pp. *!6*0B Cru?, et al. vs. =anila Aotel et al., D.R. No. L6"!! , )pril 0 , !"8#). $%ese factors -ere 'resent in t%e relation of t%e 'arties as described in t%eir C/!$ AC$ &*%ibit BAB. 555 555 555

&n <iaAa vs. Al La"adan et al.0 D.R. No. L61">#, =ay 0!, !"8>, the %upreme Court states the rule as follo$s. 7&n determinin' the e5istence of employer6employee relationship, the follo$in' elements are 'enerally considered, namely. (!) the selection and en'a'ement of the employeesB (2) the payment of $a'esB (0) the po$er of dismissalB and (*) the po$er to control the employee7s conduct C althou'h the latter is the most important element (08 )m. Jur. **8). )ssumin' that the share received by the deceased could parta-e of the nature of $a'es C on $hich $e need

not and do not e5press our vie$ C and that the second element, therefore, e5ists in the case at bar, the record does not contain any specific data re'ardin' the third and fourth elements.7 ,he clear implication of the decision of the %upreme Court is that if the defendant has no po$er of control C $hich, accordin' to the %upreme Court, is the <most important element< C there is no employer6employee relationship. (:mphasis supplied) ,he conclusion thus reached by the court a 7uo is in full accord $ith the facts and the applicable (urisprudence. @e totally a'ree $ith the court a 7uo that AF.U $as an independent contractor. )nd an independent contractor is not an <employee<.!# Neither is there any direct employment relationship bet$een ,A I$I,A and the laborers. ,he latter have no separate individual contracts $ith ,A I$I,A. &n fact, the court a 7uo found that it $as AF.U that hired them. ,heir only possible connection $ith ,A I$I,A is throu'h AF.U $hich contracted $ith the latter. Aence, they could not possibly be in a better class than AF.U $hich dealt $ith ,A I$I,A.!1 &n this connection, it is interestin' to note that the facts as found by the court a 7uo stron'ly indicate that it isAF.U itself $ho is the <employer< of those laborers. ,he facts very succinctly sho$ that it $as AF.U0 throu'h its officers, $hich (!) selected and hired the laborers, (2) paid their $a'es, (0) e5ercised control and supervision over them, and (*) had the po$er to discipline and dismiss them. ,hese are the very elements constitutin' an employer6employee relationship.!" /f course there is no le'al impediment for a union to be an <employer<. 2 +nder the particular facts of this case, ho$ever, AF.U appears to be more of a distinct and completely autonomous business 'roup or association. &ts or'ani?ational structure and operational system is no different from other commercial entities on the same line. &t even has its o$n bill collectors and truc-in' facilities. )nd that it really is en'a'ed in business is sho$n by the fact that it had arrastre and stevedorin' contracts $ith other shippin' firms in &li'an City. No$, in its all6out endeavor to ma-e an <employer< out of ,A I$I,A, AF.U citin' an impressive array of (urisprudence, even 'oes to the e5tent of insistin' that it be considered a mere <a'ent< of ,A I$I,A. %uffice it to say on this point that an a'ent can not represent t$o conflictin' interests that are diametrically opposed. )nd that the cases sou'ht to be relied upon did not involve representatives of opposin' interests. )nent the second point raised. AF.U claims that the court a 7uo found that acts of interferences and discriminations $ere committed by ,A I$I,A a'ainst the former7s members simply for their union affiliation. 2!Ao$ever, no$here in the 026pa'e decision of the court a 7uo can any such findin' be found. /n the contrary, said court made the follo$in' findin'. !1. $%ere is no s%o-in" t%at t%is ne- union0 t%e Ili"an #tevedorin" Union0 -as or"ani+ed -it% t%e %el' of t%e branc% mana"er 1ose C. $eves. ,he or'ani?er of the union li-e =essrs. %er'io /bach, Labayos and )tty. /bach and their collea'ues have never sou'ht the intervention, help or aid of the respondent CompaIia ,A I$I,A or its branch mana'er ,eves in the formation andMor or'ani?ation of the said &li'an %tevedorin' +nion. &t appears that these people have had previous -no$led'e and e5perience in handlin' stevedorin' and in the arrastre service prior to the employment of the )llied ;ree @or-ers +nion in the &li'an port. $%e c%ar"e of union interference and domination finds no su''ort from t%e evidence. (:mphasis supplied) =ore $orthy of consideration is the su''estion that the termination of the C/!$ AC$ $as in bad faith. ;irst of all, contrary to AF.U7s s$eepin' statement, the court a 7uo did not find that the termination of the C/!$ AC$ $as <in retaliation to AF.U6s demand for collective bar'ainin'. /n the contrary, the court a 7uo held that ,A I$I,A6sauthority to terminate the C/!$ AC$ $as ri'htfully e5ercised. 2!. $%e evidence does not s%o- substantially any act of interference in t%e union members%i' or activities of t%e 'etitioner union. $%e rescission of t%eir C/!$ AC$ is not a union interference contem'lated in t%e la-. 555 555 555

5 5 5 Furt%er0 t%e Court is satisfied t%at t%ere is no act or acts of discrimination as claimed by %erein 'etitioner to %ave been committed by t%e res'ondent firm or its branc% mana"er $eves. :vidence is clear that ,eves, in representation of the principal, the respondent CompaIia ,A I$I,A, has also acted, in 'ood faith in implementin' the provisions of their e5istent C/!$ AC$ (:5hibit <)<), and $hen he advised the union of the rescission of the said C/!$ AC$ effective )u'ust 0!, !"8*, he did so in the concept that the employer firm may so terminate their contract pursuant to para'raph * of :5hibit <)< $hich at the time $as the la$ controllin' bet$een them. ... (:mphasis supplied) @e are e3ually satisfied that the real reason for the termination of the C/!$ AC$ $as AF.U6s inefficient service. ,he court a 7uo dre$ its conclusion from the follo$in' findin's. !!. 9urin' the first month of the e5istence of the labor C/!$ AC$ :5hibit 7)7, the petitioner union rendered satisfactory service. +nder this situation, the CompaIia ,A I$I,A7s representative at &li'an City $as authori?ed to rene$ verbally $ith the e5tension of the C/!$ AC$ :5hibit <)< from month to month basis after the first month of its e5piration. $%is situation of

%armony lasted u' to t%e latter 'art of 45?; -%en t%e Com'aAia ,A I$I,A and its branc% mana"er a"ent com'lained to t%e union of t%e unsatisfactory service of t%e union laborers %ired to load and unload car"oes aboard Com'aAia ,A I$I,A boats. $%is deterioratin" situation -as admitted as a fact by t%e union 'resident (%ee :5hs. <0<, <06)< and <064<B %ee also t.s.n. pp. >86>>, )u'ust ", !"> ). !2. $%ere -as a s%o-in" t%at t%e laborers em'loyed by t%e union -ere inefficient in 'erformin" t%eir @obs0 and t%e business of t%e res'ondent com'any in Ili"an City suffered adversely durin" t%e year 45?:D and t%is -as due to t%e fact t%at res'ondents6 vessels -ere forced to leave car"oes be%ind in order not to disru't t%e sc%edule of de'artures. $%e Union laborers -ere sloin loadin" andCor unloadin" frei"%t from -%ic% t%e res'ondent Com'aAia ,A I$I,A secured its income andCor 'rofits. )t times, car'oes $ere left behind because of the union7s failure to load them before vessel7s departure. &n order to solve this inefficiency of the complainin' union, the branch mana'er of the CompaIia ,A I$I,A $as forced to hire e5tra laborers from amon' 7stand6by7 $or-ers not affiliated to any union for the purpose of helpin' in the stevedorin' and arrastre $or- on their vessels because, at that time, the union $as not performin' andMor renderin' efficient service in the loadin' and unloadin' of car'oes. ... 555 555 555

!*. Because of t%e deterioration of t%e #ervice rendered to t%e res'ondent0 t%e branc% mana"er of t%e res'ondent Com'aAia ,A I$I,A informed t%e union of its intention to rescind t%e C/!$ AC$ &*%ibit BAB because t%e com'any %ad been sufferin" losses for suc% inefficient service. (%ee :5hibit <N<). Respondent ,eves reported to the ,A I$I,A7s head office on the financial losses of the company in its operations. (%ee :5hibits 7E7, 7E6!7 to 7L687). !8. /n )u'ust 2*, !"8*, branch mana'er Jose C. ,eves of the &li'an City ,A I$I,A 4ranch, $rote the petitioner union informin' them of the termination of their C/!$ AC$ , :5hibit <)<. (%ee :5hibit <N<). $%is ste' -as ta8en after t%e com'any found t%e union la""in" be%ind t%eir -or8 under t%e C/!$ AC$ 0 so muc% so t%at ,A I$I,A boats %ave to leave on sc%edule -it%out loadin" car"oes already contacted to be trans'orted. (:mphasis supplied) Perhaps, AF.U mi'ht say that this ri'ht to terminate appearin' in para'raph * of the C/!$ AC$ is contrary to la$, morals, 'ood customs, public order, or public policy. 22 Ao$ever, it has not adduced any ar'ument to demonstrate such point. =oreover, there is authority to the effect that the insertion in a C/!$ AC$ for personal services of a resolutory condition permittin' the cancellation of the C/!$ AC$ by one of the contractin' parties is valid. 20 Neither $ould the termination constitute <union6bustin'<. /ceanic Air Products vs. CI , 2* cited byAF.U is not in point. ,hat case presupposes an employer6employee relationship bet$een the parties disputants C a basis absolutely $antin' in this case. AF.U7s third point is a'ain that ,A I$I,A7s act of terminatin' the C/!$ AC$ constituted union interference. )s stated, the court a 7uo found as a fact that there is no sufficient evidence of union interference. )nd no reason or ar'ument has been advanced to sho$ that the fact of said termination alone constituted union interference. ,A: C:R,&;&C),&/N :L:C,&/N C)%: (L622"82 UU Q L622"#! GC&R Case No. !#86=CH). &n the certification e(ection case, the court a 7uo directed the holdin' of a certification election amon' the laborers then doin' arrastre and stevedorin' $or-. 4oth ,A I$I,A and AF.U have appealed from that rulin'. ,he latter maintains that the lo$er court s%ould %ave directly certified it as t%e ma@ority union, entitled to represent all the $or-ers in the arrastre and stevedorin' $or- unit, $hereas ,A I$I,A contends that said court could not even have correctly ordered a certification election considerin' that there $as an absence of employer6employee relationship bet$een it and said laborers. ,here is no 3uestion that certification election could not have been proper durin' the e5istence of the C/!$ AC$in vie$ of the court a 7uo7s findin' that there $as no employment relationship thereunder bet$een the parties. 4ut after the termination of the C/!$ AC$ on )u'ust 0!, !"8*, $hat $as the nature of the relationship bet$een ,A I$I,A and the laborers6members of AF.UO ;rom the findin' that after the rescission of the C/!$ AC$ 0 ,A I$I,A continued to avail of the services ofAF.U the court a 7uo concluded that there came about an implied employer6employee relationship bet$een the parties. ,his conclusion cannot be sustained. ;irst of all, it is contradicted by the established facts. &n its findin's of fact, the court a 7uo observed that after the rescission, the AF.U laborers continued $or-in' in accordance $ith the <cabo< system, $hich $as the prevailin' custom in the place. %aid the court. 2 . After t%e rescission of t%e C/!$ AC$ &*%ibit BAB on Au"ust ;40 45?:0 t%e Allied Free .or8ers Union and its members -ere -or8in" or 'erformin" t%e -or8 of arrastre and stevedorin" service aboard 6vessels of t%e Com'aAia ,A I$I,A doc8in"

at Ili"an City 'ort under t%e 6cabo system6 t%en 'revailin" in t%at teritoryB and the customs and conditions then prevailin' $ere observed by the parties $ithout resortin' to the conditions of the former labor contract :5hibit <)<. (:mphasis supplied) +nder the <Cabo< system, the union $as an independent contractor. ,his is sho$n by the court a 7uo7s o$n findin' that prior to the C/!$ AC$ bet$een ,A I$I,A and AF.U, the former had an oral arrastre and stevedorin' a'reement $ith another union. ,his a'reement $as also based on the <cabo< system. )s found by the court a 7uo. *. ,hat prior to the e5ecution of :5hibit <)<, the arrastre and stevedorin' $or- $as performed by the &li'an @harf Laborers +nion headed by one Raymundo Labayos under a verbal a'reement similar to the nature and contents of :5hibit <)<B and this $or- continued from !"*" to !"82. 8. Under t%e oral C/!$ AC$ 0 t%e Ili"an Laborers Union actin" as an inde'endent labor contractor en"a"ed EinF t%e services of its members as laborers to 'erform t%e contract -or8 of arrastre and stevedorin" service aboard vessels of t%e Com'aAia ,A I$I,A callin" and doc8in" at Ili"an CityD and for t%e services t%erein rendered t%e union c%ar"ed s%i''ers andCor consi"nees in accordance -it% t%e consi"nment or 'lace0 and t%e 'roceeds t%ereof s%all be s%ared by t%e union members in accordance -it% t%e union6s internal rules and re"ulations. $%is system of -or8 is locally 8no-n as t%e 6cabo system6. $%e laborers -%o are members of t%e union and %ired for t%e arrastre and stevedorin" -or8 -ere 'aid on union 'ayrolls and t%e Com'aAia ,A I$I,A %as %ad not%in" to do -it% t%e 're'aration of t%e same. >. 4ecause of unsatisfactory service rendered by the &li'an @harf Labor +nion headed by Labayos, the CompaIia ,A I$I,A throu'h its a'ent in &li'an City cancelled their oral contractor and entered into a ne$ contractor, :5hibit <)< $ith the )llied ;ree @or-ers +nion (PL+=) no$ petitioner in this case. ,he terms and conditions of the same continued and $as similar to the oral contractor entered into $ith the union headed by Labayos. ... #. ,he cancellation of the oral contract $ith the &li'an @harf Labor +nion headed by Labayos $as due to the inefficient service rendered by the said union. ,he labor contract entered into by the petitioner herein (:5h. <)<) $as ne'otiated throu'h the intervention of =essrs. %alvador Lluch, =ariano Ll 4adelles, Laurentino Ll. 4adelles, Nicanor ,. Aalivas and Raymundo Labayos. $%e contract -as 're'ared by t%eir le"al 'anel and after several ne"otiations0 res'ondent $eves reluctantly si"ned t%e said -ritten contract -it% t%e union -it% t%e assurance %o-ever t%at t%e same arran"e 'reviously %ad -it% t%e former union re"ardin" t%e 'erformance and e*ecution of t%e arrastre and stevedorin" contract be follo-ed in accordance -it% t%e custom of suc% 8ind of -or8 at Ili"an City. ,he petitioner union, operated as a labor contractor under the so6called <cabor< systemB ... (:mphasis supplied) ;rom the above findin's, it is evident that, insofar as the $or-in' arran'ement $as concerned, there $as no real difference bet$een the C/!$ AC$ and the prior oral a'reement. 4oth $ere based on the <cabo< system. +nder both, (!) the union $as an independent contractor $hich en'a'ed the services of its members as laborersB (2) the char'es a'ainst the consi'nees and o$ners of car'oes $ere made directly by the unionB and (0) the laborers $ere paid on union payrolls and ,A I$I,A had nothin' to do $ith the preparation of the same. ,hese are the principal characteristics of the <cabo< system on $hich the parties based their relationship after the termination of the C/!$ AC$. Aence, since the parties observed the <cabo< system after the rescission of the C/!$ AC$0 and since the characteristics of said system sho$ that the contractin' union $as an independent contractor, it is reasonable to assume that AF.U continued bein' an independent contractor of ,A I$I,A. )nd, bein' an independent contractor, it could not 3ualify as an <employee<. @ith more reason $ould be true $ith respect to the laborers. =oreover, there is no evidence at all re'ardin' the characteristics of the $or-in' arran'ement bet$een AF.Uand ,A I$I,A after the termination of the C/!$ AC$. )ll $e have to 'o on is the court a 7uo7s findin' that the <cabo< system $as observed C a system that ne'atives employment relationship. ,he four elements 'enerally re'arded as indicatin' the employer6employee relationship C or at the very least, the element of <control< C must be sho$n to sustain the conclusion that there came about such relationship. ,he lac- of such a sho$in' in the case at bar is fatal to AF.U6s contention. Lastly, to uphold the court a 7uo7s conclusion $ould be tantamount to the imposition of an employer6employee relationship a'ainst the $ill of ,A I$I,A. ,his cannot be done, since it $ould violate ,A I$I,A7s e5clusive prero'ative to determine $hether it should enter into an employment C/!$ AC$ or not, i.e, $hether it should hire others or not. 28 &n Pam'an"a Bus Co. vs. Pambusco &m'loyees6 Union, 2> @e said. 5 5 5 ,he 'eneral ri'ht to ma-e a contract in relation to one7s business is an essential part of the liberty of the citi?ens protected by the due process clause of the constitution. ,he ri'ht of a laborer to sell his labor to such person as he may choose is, in its essence, the same as the ri'ht of an employer to purchase labor from any person $hom it chooses. ,he employer and the employee have thus an e3uality of ri'ht 'uaranteed by the constitution. 7&f the employer can compel the employee to $or- a'ainst the latter7s $ill, this is servitude. &f the employee can compel the employer to 'ive him $or- a'ainst the employer7s $ill, this is oppression (:mphasis supplied) . ,herefore, even if the AF.U laborers continued to perform arrastre and stevedorin' $or- after )u'ust 0!, !"8*, it cannot be correctly concluded C as did the court a 7uo C that an employer6employee relationship C even impliedly at that C arose $hen before there

never had been any. &ndeed, it $ould appeal unreasonable and un(ust to force such a relationship upon ,A I$I,A $hen it had clearly and continuously manifested its intention not to have any more business relationship $hatsoever $ith AF.U because of its inefficient service. &t $as only to comply $ith in(unctions and other (udicial mandates that ,A I$I,A continued to abide by the status 7uo, e5tendin' in fact and in effect the operation of the ,A I$I,A contract. ,he only remainin' 3uestion no$ is $hether, in the particular conte5t of $hat @e have said, the lo$er court7s rulin' orderin' a certification election can be sustained. )s already stated, the duty to bar'ain collectively e5ists only bet$een the <employer< and its <employees<. Ao$ever, the actual ne'otiations C $hich may possibly culminate in a concrete collective bar'ainin' contract C are carried on bet$een the <employer< itself and the officialre'resentative of the <employees< 2# C in most cases, the ma(ority labor union. %ince the only function of a certification election is to determine, $ith (udicial sanction, $ho this official representative or spo-esman of the <employees< $ill be, 21 the order for certification election in 3uestion cannot be sustained. ,here bein' no employer6employee relationship bet$een the parties disputants, there is neither a <duty to bar'ain collectively< to spea- of. )nd there bein' no such duty, to hold certification elections $ould be pointless. ,here is no reason to select a representative to ne'otiate $hen there can be no ne'otiations in the first place. @e therefore hold that $here C as in this case C there is no duty to bar'ain collectively, it is not proper to hold certification elections in connection there$ith. ,he court a 7uo7s ob(ective in imposin' the employer6employee relationship may have been to do a$ay $ith the <cabo< system $hich, althou'h not ille'al, is in its operation re'arded as disadvanta'eous to the laborers and stevedores. ,he rule ho$ever remains that the end cannot (ustify the means. ;or an action to be sanctioned by the courts, the purpose must not only be 'ood but the means underta-en must also be la$ful. ) true and sincere concern for the $elfare of AF.U members6laborers $ould call for reforms $ithin AF.U itself, if the evil of the so6 called <cabo< system is to be eliminated. )s @e su''ested in Bermiso vs. Hi@os de &scaAo, 2" the remedy a'ainst the <cabo< system need not be sou'ht in the courts but in the laborers themselves $ho should or'ani?e into a closely6-nit union <$hich $ould secure the privile'es that the members desire thru the election of officers amon' themselves $ho $ould not e5ploit them.< @herefore, the appealed decision of the Court of &ndustrial Relations is hereby affirmed insofar as it dismissed the char'e of unfair labor practice in C&R Case *2>6+LP, but reversed and set aside insofar as it ordered the holdin' of a certification election in C&R Case No. !#86=C, and the petition for certification in said case should be, as it is hereby, dismissed. No costs. %o ordered. G.R. No. 118569 NoG'*%'r 16, 1998 R .ER , J.:

/R -UCERS 1ANK ; 09E /9ILI//INES, 2no> ;#r&( /)#+#DD#n' In('rna(#ona+ 1an=3, petitioner, vs.NLRC an" /R -UCERS 1ANK E./L !EES ASS CIA0I N, respondents. &nitially, this action $as resolved in petitioner7s favor $ith the dismissal of private respondent7s complaint for unfair labor practice and violation of the C4) a'ainst the former by Labor )rbiter Jovencio =ayon. 1 +pon appeal to the National Labor Relations Commission (NLRC), the decision of the Labor )rbiter $as reversed and instead a (ud'ment $as rendered in favor of the private respondent. 9ismayed, petitioner is no$ before us see-in' the reversal of the NLRC7s decision. ,he facts are 3uite simple. Prefatorily, at the time the instant controversy started, petitioner $as placed by the then Central 4an- of the Philippines (no$ 4an'-o %entral n' Pilipinas) under a conservator for the purpose of protectin' its assets. 2 &t appears that $hen the private respondents sou'ht the implementation of %ection &, )rticle L& of the C4) re'ardin' the retirement plan and %ection *, )rticle L thereof, pertainin' to uniform allo$ance, the actin' conservator of the petitioner e5pressed her ob(ection to such plan, resultin' in an impasse bet$een the petitioner ban- and the private respondent union. ,he deadloc- continued for at least si5 months $hen the private respondent, to resolve the issue, decided to file a case a'ainst the petitioner for unfair labor practice and for fla'rant violation of the C4) provisions. )s stated earlier, the Labor )rbiter dismissed private respondent7s complaint, on this premise. Considerin' that the 4an- is under conservatorship pro'ram under $hich the ban- is under the rule of a conservator, the latter is under no compulsion to implement the resolutions issued by the L=RC. &f he finds that the enforcement of the resolutions $ould not redound for the best interest of the 4an- in accordance $ith the conservatorship pro'ram, he may not be faulted by such inaction or action. +ndaunted by the initial setbac-, private respondent union interposed an appeal before the NLRC. ,he NLRC, after revie$in' the ar'uments of both parties, reversed the findin's of the Labor )rbiter, thus. Not only is the $or-er protected by the Labor Code, he is li-e$ise protected by other la$s (Civil Code) and social le'islations the source of $hich is the no less than the Constitution itself. ,o adhere first to the interest of the company to the pre(udice of the $or-ers can never be allo$ed or tolerated as the interest of the $or-in' masses is the paramount concern of the 'overnment.

Conse3uently, the NLRC ordered the petitioner to implement the provisions of the C4) $hich $ere disallo$ed by the conservator. ,he issue need not detain us at len'th. ,he NLRC7s findin' deserves our concurrence. &n a similar case involvin' the petitioner and the acts of its conservator, 4 $e already ruled that.

&n the third place, $hile admittedly, the Central 4an- la$ 'ives vast and far6reachin' po$ers to the conservator of a ban-, it must be pointed out that such po$ers must be related to the <(preservation of) the assets of the ban-, (the reor'ani?ation of) the mana'ement thereof and (the restoration of) its viability.< %uch po$ers, enormous and e5tensive as they are, cannot e5tend to the post6facto repudiation of perfected transactions, other$ise they $ould infrin'e a'ainst the non6impairment clause of the Constitution. &f the le'islature itself cannot revo-e an e5istin' valid contract, ho$ can it dele'ate such non6e5istent po$ers to the conservator under %ection 216) of said la$O /bviously, therefore, %ection 216) merely 'ives the conservator po$er to revo-e contracts that are, under e5istin' la$, deemed to be defective C i.e., void, voidable, unenforceable or rescissible. Aence, the conservator merely ta-es the place of a ban-7s board of directors. @hat the said board cannot do C such as repudiatin' a contract validly entered into under the doctrine of implied authority C the conservator cannot do either. &neluctably, his po$er is not unilateral and he cannot simply repudiate valid obli'ations of the 4an-. Ais authority $ould be only to brin' court actions to assail such contracts C as he has already done so in the instant case. ) contrary understandin' of the la$ $ould simply not be permitted by the Constitution. Neither by common sense. ,o rule other$ise $ould be to enable a failin' ban- to become solvent, at the e5pense of third parties, by simply 'ettin' the conservator to unilaterally revo-e all previous dealin's $hich had one $ay or another come to be considered unfavorable to the 4an-, yieldin' nothin' to perfected contractual ri'hts nor vested interests of the third parties $ho had dealt $ith the 4an-. Prescindin' from the rationali?ation that a conservator cannot rescind a valid and e5istin' contract and that the C4) is the la$ bet$een the contractin' parties, 5 it is obvious that the conservator had no authority $hatsoever to disallo$ the implementation of )rticle L&, %ection ! and )rticle L, %ection * of the C4), especially considerin' that the ideals of social (ustice and protection of labor are 'uaranteed not only by the Labor Code, but more importantly by the fundamental la$ of the land. &t bears repeatin' that apart from the non6impairment clause, $hat is also $ell6settled, to the point of bein' trite, is the principle that $hen the conflictin' interests of labor and capital are $ei'hed on the scales of social (ustice, the dominant influence of the latter must be counter6balanced by the sympathy and compassion the la$ must accord the under6privile'ed $or-er. 6 Ne5t, petitioner insists that both the Labor )rbiter and the NLRC have no (urisdiction to entertain the complaint of the private respondent, 4 assertin' that the issue $as co'ni?able by the voluntary arbitrator pursuant to )rticle 2>! of the Labor Code. Drantin' that both the Labor )rbiter and the NLRC indeed had no (urisdiction over the issue, petitioner cannot anymore plead such procedural fla$ under the principle of estoppel. 8 &t appears that in the proceedin's before the Labor )rbiter, it vi'orously ar'ued its defense and prayed for alternative relief. &n fact, in its position paper 9and reply, 15 the issue concernin' the Labor )rbiter7s lac- of (urisdiction $as not raised by the petitioner. =oreover, in its ans$er 11 to the memorandum of appeal filed by the private respondents before the NLRC, petitioner $as a'ain silent re'ardin' the issue of (urisdiction on the part of the NLRC to decide the appeal. &t $as only $hen the decision of the NLRC $as unfavorable that it raised the issue of (urisdiction. Petitioner should bear the conse3uence of its act. &t cannot be allo$ed to profit from its o$n omission to the dama'e and pre(udice of the private respondent. )s $e declared in Ilocos #ur &lectric Coo'erative0 Inc. v. !L C.12 . . . . Petitioners did not 3uestion the (urisdiction of the Labor )rbiter either in a motion to dismiss or in their ans$er. &n fact, petitioners participated in the proceedin's before the Labor )rbiter, as $ell as in the NLRC to $hich they appealed the Labor )rbiter7s decision. &t has been consistently held by this Court that $hile (urisdiction may be assailed at any sta'e, a party7s active participation in the proceedin's before a court $ithout (urisdiction $ill estop such party from assailin' such lac- of it. &t is an undesirable practice of a party participatin' in the proceedin's and submittin' his case for decision and then acceptin' the (ud'ment, only if favorable, and attac-in' it for lac- of (urisdiction, $hen adverse. ;inally, petitioner asserts since the employees have retired, as a conse3uence of $hich no employee6employer relationship e5ists anymore bet$een it and the employees, private respondent no lon'er had the personality to file the complaint for them. 13 Petitioner7s contention in untenable. Retirement results from a voluntary a'reement bet$een the employer and the employee $hereby the latter after reachin' a certain a'e a'rees to sever his employment $ith the former. 14 ,he very essence of retirement is the termination of the employer6employee relationship. Aence, the retirement of an employee does not, in itself, affect his employment status especially $hen it involves all ri'hts and benefits due to him, since these must be protected as thou'h there had been no interruption of service. &t must be borne in mind that the retirement scheme $as part of the employment pac-a'e and the benefits to be derived therefrom constituted, as it $ere, a continuin'

consideration for services rendered, as $ell as an effective inducement for remainin' $ith the corporation. &t is intended to help the employee en(oy the remainin' years of his life, releasin' him from the burden of $orryin' for his financial support, and are a form of re$ard for his loyalty. 15 @hen the retired employees $ere re3uestin' that their retirement benefits be 'ranted, they $ere not pleadin' for 'enerosity but $ere merely demandin' that their ri'hts, as embodied in the C4), be reco'ni?ed. ,hus, $hen an employee has retired but his benefits under the la$ or the C4) have not yet been 'iven, he still retains, for the purpose of prosecutin' his claims, the status of an employee entitled to the protection of the Labor Code, one of $hich is the protection of the labor union. &n &sso P%ili''ines0 Inc. v. ,alayan" ,an""a"a-a sa &sso (==:), 16$e reco'ni?ed that $hile the individual complainants are the real party m interest in issues involvin' monetary claims and benefits, the union, ho$ever, is not denied its ri'ht to sue on behalf of its members, thus. @e see no le'al impediments to considerin' this particular matter of retirement benefits to be $ithin the ambit of /ur consistent holdin' that $hen it comes to individual benefits accruin' to members of a union from a favorable final (ud'ment of any court, the members themselves become the real parties in interest and it is for them, rather than for the union, to accept or re(ect individually the fruits of the liti'ation. &n the case at bar, the representations of the ==: $hich may result in pre(udice to the interests of any of its individual members in the final (ud'ment bein' sou'ht to be e5ecuted should yield to the individual decisions of the said members themselves, $ho are free to choose $hichever position suits their conscience. @A:R:;/R:, in vie$ of the fore'oin', the instant petition is 9&%=&%%:9 and the decision of the National Labor Relations Commission dated )u'ust 0!, !""* is );;&R=:9. Costs a'ainst petitioner. %/ /R9:R:9. G.R. No. L-21125 ;'%ruary 28, 1964 C NCE/CI N, %.J.: ; IN-US0RIAL

/9ILI//INE AIR LINES, INC., petitioner, vs. /9ILI//INE AIR LINES E./L !EES ASS CIA0I N an" C UR0 RELA0I NS, respondents. Paredes0 Poblador0 Cru+ G !a+areno for 'etitioner. $aAada0 Lerum G Cinco and Beltran G Lacson for res'ondents. ,ariano B. $uason for res'ondent Court of Industrial elations.

)ppeal by certiorari , ta-en by the Philippine )ir Lines, &nc. C hereinafter referred to as the P)L from an order of the Court of &ndustrial Relations C hereinafter referred to as the C&R C the dispositive part of reads. @A:R:;/R: , ,A: Philippine )ir Lines is hereby ordered to pay the four claimants, =essrs. ;ortuno 4ian'co, Aernando Duevarra, 4ernardino )barrientos and !* days each, sic- leave $hich the t$o may use or en(oy accordin' to e5istin' company rules, and re'ulations re'ardin' this privile'e, and to allo$ the four claimants the en(oyment of their earned and accumulated free trip passes both here and aboard sub(ect to the above6mentioned plan the company may adopt. &n order to effect early payment of the Christmas bonus, the Chief :5aminer of the Court or his duly authori?ed representatives is hereby directed to e5amineB pertinent records of the company, to compute and determine the Christmas bonus due each of the four claimant and to submit a report therefore immediately upon completion of the same. &t appears that on =ay *, !"8 , P)L dismissed its above named four (*) employees, $ho are member of the Philippine )ir Lines :mployees )ssociation C hereinafter referred to as P)L:) C and that on July !0, !"8*, the C&R en banc passed resolution, in Case No. *>86J thereof, directin' the reinstatement of said employess <to their former or e3uivalent position in the company, $ith bac- $a'es from the date of their reinstatement, and $ithout pre(udice to their seniority or other ri'hts and privile'es. ,his resolution $as affirmed by the %upreme Court, in D.R. No. L61!"#, on /ctober 0!, !"81. /n January !*, !"8", said employees $ere reinstated and subse3uently their bac-$a'es, computed at the rate of their compensation at the time of the aforementioned dismissal, less the $a'es and salaries earned by them else$here durin' the lay6off period, $ere paid to them. ,he employees ob(ected to this deduction and the C&R sustained them, in a Resolution dated =ay 22, !"> , $hich $as reversed by the %upreme Court, on July 2>, !"> , in D.R. No. L6!88**. %oon later, or on November ! , !"> , the P)L:) moved for the e5ecution of the C&R resolution of July !0, !"8*, as re'ards the <other ri'hts and privile'es< therein mentioned, referrin', more specifically to. (!) Christmas bonus from !"8 to !"81B (2) accumulated sic- leaveB (0) transportation allo$ance durin' lay6off periodB and (*) accumulated free trip passes, both domestic and international. 4y an order dated /ctober 1, !">2, the C&R 'ranted this motion, e5cept as re'ards the sic- leave of /nofre DriIo and 4ernardino )barrientos, and the transportation allo$ance, $hich $ere denied. Aence this appeal. P)L maintains that the C&R has erred in actin' as it did, because . (!) the aforementioned privile'es $ere not specifically mentioned in the C&R resolution of July !0, !"8*B (2) the order of the C&R dated /ctober 1, !">2, had, alle'edly, the effect of amendin' said resolutionB and (0) the clause therein <$ithout pre(udice to their seniority or other ri'hts and privile'es< should be construed prospectively, not retroactively. &nsofar as the Christmas bonus, the accumulated sic- leave privile'es and the transportation allo$ance durin' the lay6off period, the P)L7s contention is clearly devoid of merit. ,he aforementioned clause must be considered in the li'ht of the entire conte5t of the

resolution of July !0, !"8* and of its dispositive part. &n orderin' therein the <reinstatement< of said employees $ith <bac8 -a"es from t%e date of t%eir dismissal to t%e date of t%eir reinstatement0 and -it%out 're@udice to t%eir seniority or ot%er ri"%ts and 'rivile"es,< it is obvious that the resolution intended to restore the employees to their status immediately prior to their dismissal. Aence, it directed , not only their reinstatement, but, also, the payment of their bac8 $a'es durin' the period of their lay6off C thus referrin' necessarily to a period of time precedin' their reinstatement C and the retention of <their seniority or other ri'hts and privile'es<. Ri'hts reinstatement, but at the timeO Certainly, not after their reinstatement, but at the time of their aforementioned dismissal. &n other $ords, the reinstatement $as $ith bac- $a'es for the lay6off period, coupled $ith <seniority or other ri'hts and privile'es<, attached to the status of the employees $hen they $ere dismissed. ,o put it differently, the C&R treated said employees as if they had not been absent form $or- and had been uninterruptedly $or-in' durin' the lay6off period.4H-'%I4.AJt ,hus, in e'ublic #teel Cor'oration vs. !L B (!!* ;. 2d. 12 ), it $as held that, under a decree of the Circuit Court of )ppeals and /rder of the National Labor Relations 4oard directin' the employer to reinstate the stri-in' employees -it%out 're@udice to t%eir seniority or ot%er ri"%ts or 'rivile"es, it $as the intention of the 4oard and Court to provide that, upon reinstatement the employees $ere to be treated in matters involvin' seniority and continuity of employment as t%ou"% t%ey %ad not been absent from -or8, and hence the reinstated employees $ere entitled to the benefits of the employer7s vacation plan for the year in $hich they $ere reinstated and subse3uent years upon the basis of continuity of service computed as t%ou"% t%ey %ad been actually at durin" t%e entire 'eriod from t%e date of stri8e to t%e date of reinstatement. )s a conse3uence, the employees involved in the case at bar are entitled to the Christmas bonus that P)L had 'iven to all of its employees durin' said period, for said bonus, havin' been paid re'ularly, has become part of the compensation of the employees.! %aid employees are, li-e$ise, entitled to transportation allo$ance and the correspondin' sic- leave privile'es. ,hese sicleave privile'es are sub(ect, ho$ever, to the follo$in' 3ualifications, namely. (!) that the accumulated sic- leave cannot e5ceed !* days, pursuant to the collective bar'ainin' a'reement bet$een the P)L and the P)L:), effective in !"8"B and (2) that, pursuant to the same a'reement, $hich denies sic- leave privile'es to retired employees, /nofre DriIo and 4ernardino )barrientos, $ho have retired, are not entitled to said privile'es. ,he P)L7s appeal as re'ards the free trip passes is, ho$ever, $ell ta-en, for the employees had no absolute ri'ht thereto, even if they had actually rendered services durin' the lay6off period. ,he free trip passes $ere 'iven, neither automatically, nor indiscriminately. ,he employees had to apply therefore and their applications $ere sub(ect P)L7s approval. @herefore, e5cept as to the free trip passes for the lay6off period, $hich should not be deemed included in the <ri'hts and privile'es< a$arded in the resolution of July !0, !"8*, and sub(ect to the 3ualification that the accumulated sic- leave privile'es cannot e5ceed !* days, the appealed resolution of /ctober 1, !">2, is hereby affirmed in all other respects, $ithout pronouncement as to costs. &t is so ordered. G.R. No. 83195 Au$u&( 4, 1992 .E-IAL-EA, J.: ; 09E

CE1U SEA.ENES ASS CIA0I N, INC., petitioner, vs. 9 N. /URA ;ERRER-CALLEJA, SEA.ENES ASS CIA0I N /9ILS.@- .INICA C. NACUA, respondent.

,his petition see-s the reversal of the resolution of the 4ureau of Labor Relations 1 $hich affirmed the decision of the =ed6)rbiter holdin' that the set of officers of %eamen7s )ssociation of the Philippines headed by 9ominica C. Nacua, as president, $as the la$ful set of officers entitled to the release and custody of the union dues as $ell as a'ency fees of said association. ,he dispositive portion of the resolution reads. @A:R:;/R:, premises considered, the /rder of the =ed6)rbiter dated !0 July !"1# is hereby affirmed and the appeal therefrom 9&%=&%%:9 for lac- of merit. (p. 0", ollo) ,he facts surroundin' the controversy in this case, as stated in the 3uestioned resolution, is as follo$s. ,he records sho$ that sometime on 20 /ctober !"8 , a 'roup of dec- officers and marine en'ineers on board vessels plyin' Cebu and other ports of the Philippines or'ani?ed themselves into an association and re'istered the same as a non6stoc- corporation -no$n as Cebu %eamen7s )ssociation, &nc. (C%)&), $ith the %ecurities and :5chan'e Commission (%:C). Later, on 20 June !">", the same 'roup re'istered its association $ith this 4ureau as a labor union -no$n as the %eamen7s )ssociation of the Philippines, &ncorporated (%)P&). %)P& has an e5istin' collective bar'ainin' a'reement (C4)) $ith the )boiti? %hippin' Corporation $hich $ill e5pire on 0! 9ecember !"11. &n consonance $ith the C4) said company has been remittin' chec-ed6off union dues to said union until ;ebruary, !"1# $hen a 'roup composed of members of said union, introducin' itself to be its ne$ set of officers, $ent to the company and claimed that they are entitled to the remittance and custody of such union dues. ,his 'roup, headed by =anuel Dabayoyo claims that they $ere elected as such on January 2 , !"1# under the supervision of the %:C.

/n 2> =ay !"1#, another 'roup headed by 9ominica C. Nacua, claimin' as the duly elected set of officers of the union in an election held on 2 9ecember !"1>, filed a complaint, for and in behalf of the union, a'ainst the Cebu %eamen7s )ssociation, &nc. (C%)&) as represented by =anuel Dabayoyo for the security of the aforementioned C4), see-in' such relief, amon' others, as an order restrainin' the respondent from actin' on behalf of the union and directin' the )boiti? %hippin' Corp. to remit the chec-ed6off union dues for the months of =arch and )pril !"1#. /n ! June !"1#, respondent C%)& filed its )ns$erMPosition Paper alle'in' that the complainant union and C%)& are one and the same unionB that 9ominica C. Nacua and )tty. Prospero Paradilla $ho represented the union had been e5pelled as membersMofficers as of November !"1* for la$ful causesB and, that its set of officers headed by =anuel Dabayoyo has the la$ful ri'ht to the remittance and custody of the corporate funds (other$ise -no$n as union does) in 3uestion pursuant to the resolution of the %:C dated 22 )pril !"1#. ,o bolster further its posture, on the follo$in' day, !! June !"1#, the respondent also filed a =otion to 9ismiss the Complaint on the 'rounds, amon' others, that the %:C, not the =ed6)rbiter, has (urisdiction over the dispute as provided under P.9. No. " 26)B that there can neither be a complainant no respondent in the instant case as the parties involved are one and the same labor union, and that =rs. 9ominica C. Nacua and )tty. Prospero Paradilla have no personality to represent the union as they had already been e5pelled as membersMofficers thereof in t$o resolutions of the 4oard of 9irectors dated November !"1* and January !#, !"1#. /n !" June !"1#, the =ed6)rbiter issued an /rder denyin' said motion but directin' the )boiti? %hippin' Corporation to remit the already chec-ed6off union dues to the complainant union throu'h its officers end to continue remittin' any chec-ed6off union dues until further notice. ,he =ed6)rbiter also set further hearin' of the complaint on July !, !"1#. /n !" June !"1#, the respondent filed a motion for reconsideration of said order of !" June !"1#, reiteratin' its previous position. ,hereafter, the =ed6)rbiter issued the assailed /rder. . . . (pp. 0* 608, ollo) ;rom the decision of the =ed6)rbiter, Cebu %eamen7s )ssociation headed by Capt. Dabayoyo filed an appeal $ith the 4ureau of Labor Relations (4LR). ,he 4LR, as already stated, affirmed the decision of the =ed6)rbiter in a resolution dated ;ebruary !", !"11. ,he Dabayoyo 'roup appealed to the /ffice of the %ecretary, 9epartment of Labor, $hich appeal $as considered as a motion for reconsideration of the 4LR7s decision. ,he said appealMmotion for consideration $as denied for lac- of merit on )pril !!, !"11 (p. *2, ollo) by the 4LR. Aence, this petition. ,here are three issues presented for resolution in this petition, to $it. ! @A:,A:R /R N/, ,A: =:96)R4&,:R /; R:D&/N J&& A)% J+R&%9&C,&/N /J:R ,A: C)%: ), 4)R. 2. @A:,A:R /R N/, ,A: C/=PL)&N)N,6)PP:LL:: ,A: %:)=:N7% )%%/C&),&/N /; ,A: PA&L&PP&N:% @)% R:D&%,:R:9 )% ) L)4/R ;:9:R),&/N @&,A ,A: 4+R:)+ /; L)4/R R:L),&/N%. 0 @A:,A:R /R N/, 9/=&N&C) C. N)C+) )N9 PR/%P:R/ P)R)9&L(L)) A)J: (,A:) P:R%/N)L&,E ,/ R:PR:%:N, ,A: A:R:&N C/=PL)&N)N,6)PP:LL::, C/N%&9:R&ND ,A), 4/,A /; ,A:= A)J: 4::N :LP:LL:9 ;R/= ,A: )%%/C&),&/N <%:)=:N7% )%%/C&),&/N /; ,A: PA&L&PP&N:%, &NC.< (;/R=:RLE ,A: C:4+ %:)=:N7% )%%/C&),&/N, &NC.). ,here is no doubt that the controversy bet$een the aforesaid t$o sets of officers is an intra6union dispute. 4oth sets of officers claim to be entitled to the release of the union dues collected by the company $ith $hom it had an e5istin' C4). ,he controversy involves claims of different membersMofficers to certain ri'hts 'ranted under the labor code. )rticle 22> of the Labor Code vests upon the 4ureau of Labor Relations and Labor Relations 9ivision the ori'inal and e5clusive authority and (urisdiction to act on all inter6union and intra6union disputes. ,herefore, the =ed6)rbiter ori'inally, and the 9irector on appeal, correctly assumed (urisdiction over the controversy. ,he determinative issue in this case is $ho is entitled to the collection and custody of the union duesO Cebu %eamen7s )ssociation headed by Dabayoyo or %eamen7s )ssociation of the Philippines headed by Nacua. )s stated in the findin's of fact in the 3uestioned resolution of 9irector Pura ;errer6Calle(a, on /ctober 20, !"8 , a 'roup of decofficers or'ani?ed the Cebu %eamen7s )ssociation, &nc., (C%)&), a non6stoc- corporation and re'istered it $ith the %ecurities and :5chan'e Commission (%:C). ,he same 'roup re'istered the or'ani?ation $ith the 4ureau of Labor Relations (4LR) as %eamen7s )ssociation of the Philippines (%)P&). &t is the re'istration of the or'ani?ation $ith the 4LR are not $ith the %:C $hich made it a le'itimate labor or'ani?ation $ith ri'hts and privile'es 'ranted under the Labor Code.

@e 'athered from the records that C%)&, the corporation $as already inoperational before the controversy in this case arose. &n fact, on )u'ust 2*, !"1* the %:C ordered the C%)& to sho$ cause $hy its certificate of re'istration should not be revo-ed for continuous inoperation (p. 0*0, ollo). ,here is nothin' in the records $hich $ould sho$ that C%)& ans$ered said sho$6cause order. )lso, before the controversy, private respondent 9ominica Nacua $as elected president of the labor union, %)P&. &t had an e5istin' C4) $ith )boiti? %hippin' Corporation. 4efore the end of the term of private respondent Nacua, some members of the union $hich included 9omin'o =achacon and petitioner =anuel Dabayoyo sho$ed si'ns of discontentment $ith the leadership of Nacua. ,his brea-6a$ay 'roup revived the moribund corporation and issued an undated resolution e5pellin' Nacua from association (pp. 816 8", ollo). %ometime in ;ebruary, !"1#, it held its o$n election of officers supervised by the %ecurities and :5chan'e Commission. &t also filed a case of estafa a'ainst Nacua sometime in =ay, !"1> (p. 82, ollo). ,he e5pulsion of Nacua from the corporation, of $hich she denied bein' a member, has ho$ever, not affected her membership $ith the labor union. &n fact, in the elections of officers for !"1#6!"1", she $as re6elected as the president of the labor union. &n this connections, @e cannot a'ree $ith the contention of Dabayoyo that Nacua $as already e5pelled from the union. @hatever acts their 'roup had done in the corporation do not bind the labor union. =oreover, Dabayoyo cannot claim leadership of the labor 'roup by virtue of his havin' been elected as a president of the dormant corporation C%)&. +nder the principles of administrative la$ in force in this (urisdiction, decisions of administrative officers shall not be disturbed by courts, e5cept $hen the former acted $ithout or in e5cess of their (urisdiction or $ith 'rave abuse of discretion. Public respondent 4ureau of Labor Relations correctly ruled on the basis of the evidence presented by the parties that %)P&, the le'itimate labor union, re'istered $ith its office, is not the same association as C%)&, the corporation, insofar as their ri'hts under the Labor Code are concerned. Aence, the former and not the latter association is entitled to the release and custody of union fees $ith )boiti? %hippin' and other shippin' companies $ith $hom it had an e5istin' C4). )s correctly held by public respondent. &t is undisputed from the records that the election of the so6called set of officers headed by =anuel Dabayoyo $as conducted under the supervision of the %:C, presumably in accordance $ith its constitution and by6la$s as $ell as the articles of incorporation of respondent C%)&, and the Corporation Code. ,hat had been so precisely on the honest belief of the participants therein that they $ere actin' in their capacity as members of the said corporation. ,hat bein' the case, the aforementioned set of officers is of the respondent corporation and not of the complainant union. &t follo$s, then, that any proceedin's, and actions ta-en by said set of officers can not, in any manner, affect the union and its members. /n the other hand, $e rule and so hold that the other set of officers headed by 9ominica C. Nacua is the la$ful set of officers of %)P& and therefore, is entitled to the release and custody of the union dues as $ell as the a'ency fees, if any, there be. ) record chec- $ith the Labor /r'ani?ations (L/9), this 4ureau, sho$s that %)P& has submitted to it for file the list of this ne$ set of officers, in compliance $ith the second para'raph of )rticle 2*2 (c) of the Labor Code. ,his list sufficiently sustains the vie$ that said officers $ere la$fully elected, in the absence of clear and convincin' proof to the contrary. (pp. "6! , ollo) )CC/R9&NDLE, the petition is 9&%=&%%:9. ,he 3uestioned resolution of the 4ureau of Labor Relations is );;&R=:9. %/ /R9:R:9. G.R. No. 85194 .ar6) 18, 1991 GRIF -A<UIN , J.:p

NES0LH /9ILI//INES, INC., petitioner, vs. NLRC, EUGENIA C. NUNE7, LI7A 0. VILLANUEVA, E..ANUEL S. VILLENA, RU- L/9 C. AR.AS, R - L; .. KUA an" R - L; A. S LI-U., respondents. ,his petition for certiorari see-s a revie$ of the resolutions dated =ay 21, !"11 and %eptember !, !"11 of the National Labor Relations Commission (NLRC) in &n(unction Case No. !812 'rantin' the in(unction prayed for by the private respondents, to hold in abeyance the cancellation of their car loans and payments of the monthly amorti?ations thereon pendin' the resolution of their complaints for ille'al dismissal. ,he private respondents $ere employed by the petitioner either as sales representatives or medical representatives. 4y reason of the nature of their $or- they $ere each allo$ed to avail of the company7s car loan policy. +nder that policy, the company advances the purchase price of a car to be paid bac- by the employee throu'h monthly deductions from his salary, the company retainin' the o$nership of the motor vehicle until it shall have been fully paid for. )ll of the private respondents availed of the petitioner7s car loan policy. /n %eptember !*, !"1#, private respondents NuIe?, Jillanueva, Jillena and )rmas $ere dismissed from the service for havin' participated in an ille'al stri-e. /n 9ecember 2>, !"1#, respondents 2ua and %olidum $ere also dismissed for certain irre'ularities. )ll the private respondents filed complaints for ille'al dismissal in the )rbitration 4ranch of the NLRC. ,he Labor )rbiter dismissed their complaints and upheld the le'ality of their dismissal. ,hey appealed to the NLRC $here their appeals are still pendin'.

&n the Notices of 9ismissal $hich they received from NestlV, the private respondents had been directed to either settle the remainin' balance of the cost of their respective cars, or return them to the company for proper disposition. )s they failed and refused to avail of either option, the company filed in the Re'ional ,rial Court of =a-ati a civil suit to recover possession of the cars. ,he Court issued an /rder dated =arch #, !"11 directin' the 9eputy %heriff to ta-e the motor vehicles into his custody. ,he private respondents sou'ht a temporary restrainin' order in the NLRC to stop the company from cancellin' their car loans and collectin' their monthly amorti?ations pendin' the final resolution of their appeals in the ille'al dismissal case. /n =ay 2#, !"11, the NLRC en banc, issued a resolution 'rantin' their petition for in(unction. &ts order reads. )ctin' on the +r'ent Petition for the &ssuance of a ,emporary Restrainin' /rder, the Commission sittin' en banc after deliberation, Resolved to hold in abeyance the cancellation of the petitioners7 car loans and the payment of the monthly amorti?ations thereof pendin' resolution of their ille'al dismissal cases. (p. 8, ollo.) ,he company filed a motion for reconsideration, but it $as denied for tardiness. Aence, this petition for certiorarialle'in' that the NLRC acted $ith 'rave abuse of discretion amountin' to lac- of (urisdiction $hen it issued a labor in(unction $ithout le'al basis and in the absence of any labor dispute related to the same. ,he private respondents, in their comment on the petition, alle'ed that there is a labor dispute bet$een the petitioner and the private respondents and that their default in payin' the amorti?ations for their cars $as brou'ht about by their ille'al dismissal from $or- by the petitioner as punishment for their participation in the ille'al stri-e of the +nion of ;ilipro :mployees of $hich they are members. &f they had not participated in the stri-e, they $ould not have been dismissed from $or- and they $ould not have defaulted in the payment of their amorti?ations. Private respondents admitted their civil obli'ation to the petitioner. ,he /ffice of the %olicitor Deneral filed a manifestation on June !0, !"1", statin' that <after (udicious scrutiny of the records, . . . and in consonance $ith the applicable la$ and (urisprudence on the matter, the /ffice of the %olicitor Deneral is convinced that it cannot, $ithout violatin' the la$, sustain the findin's of the National Labor Relations Commission in the case at bar. %o as not to pre(udice NLRC7s case, the /%D deems it best to refrain from filin' its Comment, even as it be's leave of the Aonorable Court to be e5cused from further appearin' in behalf of the NLRC in this particular case< (p. !#0, ollo). ;ilin' its o$n comment, the NLRC ar'ued that as the ille'al dismissal case is a labor dispute $hich is still pendin' resolution before it, <it is clothed $ith authority to issue the contested resolutions because under the la$, P9 **2, other$ise -no$n as the Labor Code of the Philippines as amended, it is vested $ith the authority to resolve labor disputes< (p. 282, ollo). ,he po$er of the NLRC to issue $rits of in(unction is found in )rticle 2!1 of the Labor Code, $hich provides. )rt. 2!1 Po-ers of t%e Commission. C ,he Commission shall have the po$er and authority. 555 555 555 (e) ,o en(oin or restrain any actual or threatened commission of any or all prohibited or unla$ful acts or to re3uire the performance of a particular act in any labor dis'ute $hich, if not restrained or performed forth$ith, may cause 'rave or irreparable dama'e to any party or render ineffectual any decision in favor of such party. . . . (:mphasis ours.) ,hat po$er, as the statute provides, can only be e5ercised in a labor dispute. Para'raph (!) of )rticle 2!2 of the Labor Code defines a labor dispute as follo$s. (!) <Labor dispute< includes any controversy or matters concernin' terms or conditions of employment or the association or representation of persons in ne'otiatin', fi5in', maintainin', chan'in' or arran'in' the terms and conditions of employment, re'ardless of $hether the disputants stand in the pro5imate relation of employer and employee. NestlV7s demand for payment of the private respondents7 amorti?ations on their car loans, or, in the alternative, the return of the cars to the company, is not a labor, but a civil, dispute. &t involves debtor6creditor relations, rather than employee6employer relations. Petitioner NestlV Philippines, &nc., correctly pointed out that. ,he t$in directives contained in petitioner7s letters to the private respondents to either (!) settle the remainin' balance on the value of their assi'ned cars under the company car plan or return the cars to the company for proper dispositionB or (2) to pay all outstandin' accountabilities to the company C are matters related to the enforcement of a civil obli'ation founded on contract. &t is not dependent on or related to any labor aspect under $hich a labor

in(unction can be issued. @hether or not the private respondents remain as employees of the petitioner, there is no escape from their obli'ation to pay their outstandin' accountabilities to the petitionerB and if they cannot afford it, to return the cars assi'ned to them. )s noted, the options 'iven to the private respondents are civil in nature arisin' from contractual obli'ations. ,here is no labor aspect involved in the enforcement of those obli'ations. (p. #, ollo.) ,he NLRC 'ravely abused its discretion and e5ceeded its (urisdiction by issuin' the $rit of in(unction to stop the company from enforcin' the civil obli'ation of the private respondents under the car loan a'reements and from protectin' its interest in the cars $hich, by the terms of those a'reements, belon' to it (the company) until their purchase price shall have been fully paid by the employee. ,he terms of the car loan a'reements are not in issue in the labor case. ,he ri'hts and obli'ations of the parties under those contracts may be enforced by a separate civil action in the re'ular courts, not in the NLRC. @A:R:;/R:, the petition for certiorari is 'ranted. ,he 3uestioned resolution dated =ay 2#, !"11 of the NLRC in &n(unction Case No. !812 ()nne5 )) is hereby annulled and set aside. Costs a'ainst the private respondents. %/ /R9:R:9. G.R. No. 84455 Jun' 13, 1995 .ELENCI -9ERRERA, J.:

SAN .IGUEL C R/ RA0I N E./L !EES UNI N-/0G, , -ANIEL S.L. 1 R1 N II, 9ER.INIA RE!ES, .ARCELA /URI;ICACI N, E0 AL., petitioners, vs. 9 N. JESUS G. 1ERSA.IRA, IN 9IS CA/ACI0! AS /RESI-ING JU-GE ; 1RANC9 166, R0C, /ASIG, an" SAN .IGUEL C R/ RA0I N, respondents. omeo C. La"man for 'etitioners. 1ardele+a0 #obrevinas0 Dia+0 ,ayudini G Bode"on for res'ondents. Respondent Jud'e of the Re'ional ,rial Court of Pasi', 4ranch !>>, is ta-en to tas- by petitioners in this special civil action for certiorari and Prohibition for havin' issued the challen'ed @rit of Preliminary &n(unction on 2" =arch !"1" in Civil Case No. 8# 88 of his Court entitled <#an ,i"uel Cor'oration vs. #,C&U)P$(./0 et als.< Petitioners7 plea is that said @rit $as issued $ithout or in e5cess of (urisdiction and $ith 'rave abuse of discretion, a labor dispute bein' involved. Private respondent %an =i'uel Corporation (%an=i'. for short), for its part, defends the @rit on the 'round of absence of any employer6employee relationship bet$een it and the contractual $or-ers employed by the companies Lipercon %ervices, &nc. (Lipercon) and 97Rite %ervice :nterprises (97Rite), besides the fact that the +nion is bereft of personality to represent said $or-ers for purposes of collective bar'ainin'. ,he %olicitor Deneral a'rees $ith the position of %an=i'. ,he antecedents of the controversy reveal that. %ometime in !"10 and !"1*, %an=i' entered into contracts for merchandisin' services $ith Lipercon and 97Rite ()nne5es 2 and &, %an=i'7s Comment, respectively). ,hese companies are independent contractors duly licensed by the 9epartment of Labor and :mployment (9/L:). %an=i' entered into those contracts to maintain its competitive position and in -eepin' $ith the imperatives of efficiency, business e5pansion and diversity of its operation. &n said contracts, it $as e5pressly understood and a'reed that the $or-ers employed by the contractors $ere to be paid by the latter and that none of them $ere to be deemed employees or a'ents of %an=i'. ,here $as to be no employer6employee relation bet$een the contractors andMor its $or-ers, on the one hand, and %an=i' on the other. Petitioner %an =i'uel Corporation :mployees +nion6P,@D/ (the +nion, for brevity) is the duly authori?ed representative of the monthly paid ran-6and6file employees of %an=i' $ith $hom the latter e5ecuted a Collective 4ar'ainin' )'reement (C4)) effective ! July !"1> to 0 June !"1" ()nne5 ), %an=i'7s Comment). %ection ! of their C4) specifically provides that <temporary, probationary, or contract employees and $or-ers are e5cluded from the bar'ainin' unit and, therefore, outside the scope of this )'reement.< &n a letter, dated 2 November !"11 ()nne5 C, Petition), the +nion advised %an=i' that some Lipercon and 97Rite $or-ers had si'ned up for union membership and sou'ht the re'ulari?ation of their employment $ith %=C. ,he +nion alle'ed that this 'roup of employees, $hile appearin' to be contractual $or-ers supposedly independent contractors, have been continuously $or-in' for %an=i' for a period ran'in' from si5 (>) months to fifteen (!8) years and that their $or- is neither casual nor seasonal as they are performin' $or- or activities necessary or desirable in the usual business or trade of %an=i'. ,hus, it $as contended that there e5ists a <labor6only< contractin' situation. &t $as then demanded that the employment status of these $or-ers be re'ulari?ed. /n !2 January !"1" on the 'round that it had failed to receive any favorable response from %an=i', the +nion filed a notice of stri-e for unfair labor practice, C4) violations, and union bustin' ()nne5 9, Petition). /n 0 January !"1", the +nion a'ain filed a second notice of stri-e for unfair labor practice ()nne5 ;, Petition).

)s in the first notice of stri-e. Conciliatory meetin's $ere held on the second notice. %ubse3uently, the t$o (2) notices of stri-e $ere consolidated and several conciliation conferences $ere held to settle the dispute before the National Conciliation and =ediation 4oard (NC=4) of 9/L: ()nne5 D, Petition). 4e'innin' !* ;ebruary !"1" until 2 =arch !"1", series of pic-ets $ere sta'ed by Lipercon and 97Rite $or-ers in various %=C plants and offices. /n > =arch !"1", %=C filed a verified Complaint for &n(unction and 9ama'es before respondent Court to en(oin the +nion from. a. representin' andMor actin' for and in behalf of the employees of L&P:RC/N andMor 97R&,: for the purposes of collective bar'ainin'B b. callin' for and holdin' a stri-e vote, to compel plaintiff to hire the employees or $or-ers of L&P:RC/N and 97R&,:B c. incitin', insti'atin' andMor inducin' the employees or $or-ers of L&P:RC/N and 97R&,: to demonstrate andMor pic-et at the plants and offices of plaintiff $ithin the bar'ainin' unit referred to in the C4),...B d. sta'in' a stri-e to compel plaintiff to hire the employees or $or-ers of L&P:RC/N and 97R&,:B e. usin' the employees or $or-ers of L&P:RC/N )N9 97R&,: to man the stri-e area andMor pic-et lines andMor barricades $hich the defendants may set up at the plants and offices of plaintiff $ithin the bar'ainin' unit referred to in the C4) ...B f. intimidatin', threatenin' $ith bodily harm andMor molestin' the other employees andMor contract $or-ers of plaintiff, as $ell as those persons la$fully transactin' business $ith plaintiff at the $or- places $ithin the bar'ainin' unit referred to in the C4), ..., to compel plaintiff to hire the employees or $or-ers of L&P:RC/N and 97R&,:B '. bloc-in', preventin', prohibitin', obstructin' andMor impedin' the free in'ress to, and e'ress from, the $or- places $ithin the bar'ainin' unit referred to in the C4) .., to compel plaintiff to hire the employees or $or-ers of L&P:RC/N and 97R&,:B h. preventin' andMor disruptin' the peaceful and normal operation of plaintiff at the $or- places $ithin the bar'ainin' unit referred to in the C4), )nne5 7C7 hereof, to compel plaintiff to hire the employees or $or-ers of L&P:RC/N and 97R&,:. ()nne5 A, Petition) Respondent Court found the Complaint sufficient in form and substance and issued a ,emporary Restrainin' /rder for the purpose of maintainin' the status 7uo0 and set the application for &n(unction for hearin'. &n the meantime, on !0 =arch !"1", the +nion filed a =otion to 9ismiss %an=i'7s Complaint on the 'round of lac- of (urisdiction over the caseMnature of the action, $hich motion $as opposed by %an=i'. ,hat =otion $as denied by respondent Jud'e in an /rder dated !! )pril !"1". )fter several hearin's on %an=i'7s application for in(unctive relief, $here the parties presented both testimonial and documentary evidence on 28 =arch !"1", respondent Court issued the 3uestioned /rder ()nne5 ), Petition) 'rantin' the application and en(oinin' the +nion from Committin' the acts complained of, su'ra. )ccordin'ly, on 2" =arch !"1", respondent Court issued the correspondin' @rit of Preliminary &n(unction after %an=i' had posted the re3uired bond of P! , . to ans$er for $hatever dama'es petitioners may sustain by reason thereof. &n issuin' the &n(unction, respondent Court rationali?ed. ,he absence of employer6employee relationship ne'ates the e5istence of labor dispute. Jerily, this court has (urisdiction to ta-e co'ni?ance of plaintiff7s 'rievance. ,he evidence so far presented indicates that plaintiff has contracts for services $ith Lipercon and 97Rite. ,he application and contract for employment of the defendants7 $itnesses are either $ith Lipercon or 97Rite. @hat could be discerned is that there is no employer6employee relationship bet$een plaintiff and the contractual $or-ers employed by Lipercon and 97Rite. ,his, ho$ever, does not mean that a final determination re'ardin' the 3uestion of the e5istence of employer6employee relationship has already been made. ,o finally resolve this dispute, the court must e5tensively consider and delve into the manner of selection and en'a'ement of the putative employeeB the mode of payment of $a'esB the presence or absence of a po$er of dismissalB and the Presence or absence of a po$er to control the putative employee7s conduct. ,his necessitates a full6blo$n trial. &f the acts complained of are not restrained, plaintiff $ould, undoubtedly, suffer irreparable dama'es. +pon the other hand, a $rit of in(unction does not necessarily e5pose defendants to irreparable dama'es.

:vidently, plaintiff has established its ri'ht to the relief demanded. (p. 2!, Rollo) )nchored on 'rave abuse of discretion, petitioners are no$ before us see-in' nullification of the challen'ed @rit. /n 2* )pril !"1", $e issued a ,emporary Restrainin' /rder en(oinin' the implementation of the &n(unction issued by respondent Court. ,he +nion construed this to mean that <$e can no$ stri-e,< $hich it superimposed on the /rder and $idely circulated to entice the +nion membership to 'o on stri-e. +pon bein' apprised thereof, in a Resolution of 2* =ay !"1", $e re3uired the parties to <R:%,/R: the status 7uo ante declaration of stri-e< (p. 2,>2 Rollo). &n the meantime, ho$ever, or on 2 =ay !"1", the +nion $ent on stri-e. )pparently, some of the contractual $or-ers of Lipercon and 97Rite had been laid off. ,he stri-e adversely affected thirteen (!0) of the latter7s plants and offices. /n 0 =ay !"1", the National Conciliation and =ediation 4oard (NC=4) called the parties to conciliation. ,he +nion stated that it $ould lift the stri-e if the thirty (0 ) Lipercon and 97Rite employees $ere recalled, and discussion on their other demands, such as $a'e distortion and appointment of coordinators, $ere made. :ffected eventually $as a =emorandum of )'reement bet$een %an=i' and the +nion that <$ithout pre(udice to the outcome of D.R. No. 1## (this case) and Civil Case No. 8# 88 (the case belo$), the laid6off individuals ... shall be recalled effective 1 =ay !"1" to their former (obs or e3uivalent positions under the same terms and conditions prior to <lay6off< ()nne5 !8, %an=i' Comment). &n turn, the +nion $ould immediately lift the pic-ets and return to $or-. )fter an e5chan'e of pleadin's, this Court, on !2 /ctober !"1", 'ave due course to the Petition and re3uired the parties to submit their memoranda simultaneously, the last of $hich $as filed on " January !"" . ,he focal issue for determination is $hether or not respondent Court correctly assumed (urisdiction over the present controversy and properly issued the @rit of Preliminary &n(unction to the resolution of that 3uestion, is the matter of $hether, or not the case at bar involves, or is in connection $ith, or relates to a labor dispute. )n affirmative ans$er $ould brin' the case $ithin the ori'inal and e5clusive (urisdiction of labor tribunals to the e5clusion of the re'ular Courts. Petitioners ta-e the position that 7it is beyond dispute that the controversy in the court a 7uo involves or arose out of a labor dispute and is directly connected or inter$oven $ith the cases pendin' $ith the NC=469/L:, and is thus beyond the ambit of the public respondent7s (urisdiction. ,hat the acts complained of (i.e., the mass concerted action of pic-etin' and the reliefs prayed for by the private respondent) are $ithin the competence of labor tribunals, is beyond 3uestion< (pp. >6#, Petitioners7 =emo). /n the other hand, %an=i' denies the e5istence of any employer6employee relationship and conse3uently of any labor dispute bet$een itself and the +nion. %an=i' submits, in particular, that <respondent Court is vested $ith (urisdiction and (udicial competence to en(oin the specific type of stri-e sta'ed by petitioner union and its officers herein complained of,< for the reasons that. ). ,he e5clusive bar'ainin' representative of an employer unit cannot stri-e to compel the employer to hire and thereby create an employment relationship $ith contractual $or-ers, especially $ere the contractual $or-ers $ere reco'ni?ed by the union, under the 'overnin' collective bar'ainin' a'reement, as e5cluded from, and therefore stran'ers to, the bar'ainin' unit. 4. ) stri-e is a coercive economic $eapon 'ranted the bar'ainin' representative only in the event of a deadloc- in a labor dispute over 7$a'es, hours of $or- and all other and of the employment7 of the employees in the unit. ,he union leaders cannot insti'ate a stri-e to compel the employer, especially on the eve of certification elections, to hire stran'ers or $or-ers outside the unit, in the hope the latter $ill help re6elect them. C. Civil courts have the (urisdiction to en(oin the above because this specie of stri-e does not arise out of a labor dispute, is an abuse of ri'ht, and violates the employer7s constitutional liberty to hire or not to hire. (%an=i'7s =emorandum, pp. *#86*#>, Rollo). @e find the Petition of a meritorious character. ) <labor dispute< as defined in )rticle 2!2 (!) of the Labor Code includes <any controversy or matter concernin' terms and conditions of employment or the association or representation of persons in ne'otiatin', fi5in', maintainin', chan'in', or arran'in' the terms and conditions of employment, re'ardless of $hether the disputants stand in the pro5imate relation of employer and employee.< @hile it is %an=i'7s submission that no employer6employee relationship e5ists bet$een itself, on the one hand, and the contractual $or-ers of Lipercon and 97Rite on the other, a labor dispute can nevertheless e5ist <re'ardless of $hether the disputants stand in the pro5imate relationship of employer and employee< ()rticle 2!2 G!H, Labor Code, su'ra) provided the controversy concerns, amon' others, the terms and conditions of employment or a <chan'e< or <arran'ement< thereof (ibid). Put differently, and as defined by la$, the e5istence of a labor dispute is not ne'ative by the fact that the plaintiffs and defendants do not stand in the pro5imate relation of employer and employee. ,hat a labor dispute, as defined by the la$, does e5ist herein is evident. )t bottom, $hat the +nion see-s is to re'ulari?e the status of the employees contracted by Lipercon and 97Rite in effect, that they be absorbed into the $or-in' unit of %an=i'. ,his matter definitely

d$ells on the $or-in' relationship bet$een said employees vis6a6vis %an=i'. ,erms, tenure and conditions of their employment and the arran'ement of those terms are thus involved brin'in' the matter $ithin the purvie$ of a labor dispute. ;urther, the +nion also see-s to represent those $or-ers, $ho have si'ned up for +nion membership, for the purpose of collective bar'ainin'. %an=i', for its part, resists that +nion demand on the 'round that there is no employer6employee relationship bet$een it and those $or-ers and because the demand violates the terms of their C4). /bvious then is that representation and association, for the purpose of ne'otiatin' the conditions of employment are also involved. &n fact, the in(unction sou'ht by %an=i' $as precisely also to prevent such representation. )'ain, the matter of representation falls $ithin the scope of a labor dispute. Neither can it be denied that the controversy belo$ is directly connected $ith the labor dispute already ta-en co'ni?ance of by the NC=469/L: (NC=46NCR6 N%6 !6 2!61"B NC=4 NCR N%6 !6 "0610). @hether or not the +nion demands are validB $hether or not %an=i'7s contracts $ith Lipercon and 97Rite constitute <labor6only< contractin' and, therefore, a re'ular employer6employee relationship may, in fact, be said to e5istB $hether or not the +nion can la$fully represent the $or-ers of Lipercon and 97Rite in their demands a'ainst %an=i' in the li'ht of the e5istin' C4)B $hether or not the notice of stri-e $as valid and the stri-e itself le'al $hen it $as alle'edly insti'ated to compel the employer to hire stran'ers outside the $or-in' unitB C those are issues the resolution of $hich call for the application of labor la$s, and %an=i'7s cause7s of action in the Court belo$ are ine5tricably lin-ed $ith those issues. ,he precedent in Layno vs. de la Cru+ (D.R. No. L62">0>, 0 )pril !">8, !0 %CR) #01) relied upon by %an=i' is not controllin' as in that case there $as no controversy over terms, tenure or conditions, of employment or the representation of employees that called for the application of labor la$s. &n that case, $hat the petitionin' union demanded $as not a chan'e in $or-in' terms and conditions, or the representation of the employees, but that its members be hired as stevedores in the place of the members of a rival union, $hich petitioners $anted dischar'ed not$ithstandin' the e5istin' contract of the arrastre company $ith the latter union. Aence, the rulin' therein, on the basis of those facts uni3ue to that case, that such a demand could hardly be considered a labor dispute. )s the case is indisputably lin-ed $ith a labor dispute, (urisdiction belon's to the labor tribunals. )s e5plicitly provided for in )rticle 2!# of the Labor Code, prior to its amendment by R.). No. >#!8 on 2! =arch !"1", since the suit belo$ $as instituted on > =arch !"1", Labor )rbiters have ori'inal and e5clusive (urisdiction to hear and decide the follo$in' cases involvin' all $or-ers includin' <!. unfair labor practice casesB 2. those that $or-ers may file involvin' $a'es, hours of $or- and other terms and conditions of employmentB ... and 8. cases arisin' from any violation of )rticle 2>8 of this Code, includin' 3uestions involvin' the le'ality of stri-er and loc-outs. ...< )rticle 2!# lays do$n the plain command of the la$. ,he claim of %an=i' that the action belo$ is for dama'es under )rticles !", 2 and 2! of the Civil Code $ould not suffice to -eep the case $ithin the (urisdictional boundaries of re'ular Courts. ,hat claim for dama'es is inter$oven $ith a labor dispute e5istin' bet$een the parties and $ould have to be ventilated before the administrative machinery established for the e5peditious settlement of those disputes. ,o allo$ the action filed belo$ to prosper $ould brin' about <split (urisdiction< $hich is obno5ious to the orderly administration of (ustice (Philippine Communications, :lectronics and :lectricity @or-ers ;ederation vs. Aon. Nolasco, L62*"1*, 2" July !">1, 2* %CR) 02!). @e reco'ni?e the proprietary ri'ht of %an=i' to e5ercise an inherent mana'ement prero'ative and its best business (ud'ment to determine $hether it should contract out the performance of some of its $or- to independent contractors. Ao$ever, the ri'hts of all $or-ers to self6or'ani?ation, collective bar'ainin' and ne'otiations, and peaceful concerted activities, includin' the ri'ht to stri-e in accordance $ith la$ (%ection 0, )rticle L&&&, !"1# Constitution) e3ually call for reco'nition and protection. ,hose contendin' interests must be placed in proper perspective and e3uilibrium. @A:R:;/R:, the @rit of certiorari is DR)N,:9 and the /rders of respondent Jud'e of 28 =arch !"1" and 2" =arch !"1" are %:, )%&9:. ,he @rit of Prohibition is DR)N,:9 and respondent Jud'e is en(oined from ta-in' any further action in Civil Case No. 8# 88 e5cept for the purpose of dismissin' it. ,he status 7uo ante declaration of stri-e ordered by the Court on 2* =ay !"1" shall be observed pendin' the proceedin's in the National Conciliation =ediation 4oard69epartment of Labor and :mployment, doc-eted as NC=46NCR6N%6 !6 2!1" and NC=46NCR6N%6 !6 "0610. No costs. %/ /R9:R:9.