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JURISDICTION OF LABOR TRIBUNALS (11 cases)

73. PEPSI-COLA DISTRIBUTORS VS. GALANG (from SCRIBD, no one submitted in Vikings!!)(Jay)

FACTS: The private respondents were employees of the petitioner who were suspected of complicity in
the irregular disposition of empty Pepsi Cola bottles. On July 16, 1987, the petitioners filed a criminal
complaint for theft against them but this was later withdrawn and substituted with a criminal complaint
for falsification of private documents. After a preliminary investigation conducted by the Municipal Trial
Court of Tanauan, Leyte, the complaint was dismissed.

Allegedly after an administrative investigation, the private respondents were dismissed by the petitioner
company on November 23, 1987. As a result, they lodged a complaint for illegal dismissal with the
Regional Arbitration Branch of the NLRC in Tacloban City and decisions mandateed reinstatement with
damages. In addition, they instituted in the Regional Trial Court of Leyte, a separate civil complaint
against the petitioners for damages arising from what they claimed to be their malicious prosecution.

The petitioners moved to dismiss the civil complaint on the ground that the trial court had no
jurisdiction over the case because it involved employee-employer relations that were exclusively
cognizable by the labor arbiter. The motion was granted .On July 6, 1989, however, the respondent
judge, acting on the motion for reconsideration, reinstated the complaint, saying it was distinct from
the labor case for damages now pending before the labor courts. The petitioners then came to this
Court for relief.

ISSUE: Whether or not it is the Labor Arbiter has jurisdiction over the claim for damages arising from
the malicious prosecution of the petitioner company.

RULING: No. It must be stressed that not every controversy involving workers and their employers can
be resolved only by the labor arbiters. This will be so only if there is a reasonable causal connection
between the claim asserted and employee-employer relations to put the case under the provisions of
Article 217. Absent such a link, the complaint will be cognizable by the regular courts of justice in the
exercise of their civil and criminal jurisdiction. The case now before the Court involves a complaint for
damages for malicious prosecution which was filed with the Regional Trial Court of Leyte by the
employees of the defendant company. It does not appear that there is a reasonable causal connection
between the complaint and the relations of the parties as employer and employees. The complaint did
not arise from such relations and in fact could have arisen independently of an employment relationship
between the parties. No such relationship or any unfair labor practice is asserted. What the employees
are alleging is that the petitioners acted with bad faith when they filed the criminal complaint which the
Municipal Trial Court said was intended to harass the poor employees and the dismissal of which was
affirmed by the Provincial Prosecutor for lack of evidence to establish even a slightest probability that
all the respondents.

74. San Miguel v. Etcuban (Julius)

Facts: San Miguel Corporation informed its Mandaue City Brewery employees that it was suffering from
heavy losses and financial distress which could lead to its total closure. SMC offered its retrenchment
program to its employees. Many employees availed of the program. they were given their termination
letters and separation pay. In return, the employees executed receipt and release documents in favor of
SMC.
Subsequently, the ex-employees discovered that SMC was never in any financial difficulty and was hiring
new employees. The ex-employees sought to declare the retrenchment null and void.

Issue: Is the cause of action of the employees valid?

Ruling: No. The demarcation line between the jurisdiction of regular courts and labor courts over cases
involving workers and their employers has always been the subject of the dispute. The court has
recognized that not all claims involving such groups of litigants can be resolved solely by our labor
courts. However, we have also admonished that the present trend is to refer worker-employer
controversies to labor courts, unless unmistakably provided by the law to be otherwise. Because of this
trend, jurisprudence has developed the reasonable causal connection rule. Under this rule, if there is a
reasonable causal connection between the claim asserted and the employer-employee relations, then
the case is within the jurisdiction of our labor courts. In the absence of such nexus, it is the regular
courts that have jurisdiction.
In the present case, while respondents insist that their action is for the declaration of nullity of their
contract of termination, what is inescapable is the fact that it is, in reality, an action for damages
emanating form employeremployee relations. First, their claim for damages is grounded on their having
been deceived into serving their employment due to SMCs concocted financial distress and fraudulent
retrenchment program a clear case of illegal dismissal. Second, a comparison of respondents complaint
for the declaration of nullity of the retrenchment program before the labor arbiter and the complaint for
the declaration of nullity of their contract of termination before the RTC reveals that the allegations and
prayer of the former are almost identical with those of the latter except that the prayer for
reinstatement was no longer included and the claim for backwages and other benefits was replaced
with a claim for actual damages. These are telltale signs that respondents claim for damages is
intertwined with their having been separated from their employment without just cause and,
consequently, has a reasonable causal connection with their employer-employee relations with SMC.
Accordingly, it cannot be denied that respondents claim falls under the jurisdiction of the labor arbiter
as provided in paragraph 4 of Article 217. Respondents assertion that their action is for the declaration
of nullity of their contract of termination is merely an ingenious way of presenting their actual action,
which is a claim for damages grounded on their having been illegal terminated.
The fact that SMC was never in financial distress does not, in any way, affect the cause of their contract
of termination. Rather, the fraudulent representations of SMC only affected the consent of respondents
in entering into the said contract.[18] If the consent of a contracting party is vitiated by fraud, the
contract is not void but, merely, voidable
75. Banez vs. Valdevilla (from SCRIBD, no one submitted in Vikings!!)(Junney)

Fact:Banez was the sales operations manager of private respondent in its branch in Iligan City. In 1993,
private respondent "indefinitely suspended" petitioner and the latter filed a complaint for illegal
dismissal with the National Labor Relations Commission. Both the Labor Arbiter and NLRC Found in
FAVOV of Banez. ORO Marketing Filed a complaint With the RTC For damages against Banez. According
to Oro: Defendant canvassed customers personally or through salesmen of plaintiff which were hired or
recruited by him. If said customer decided to buy items from plaintiff on installment basis, defendant,
without the knowledge of said customer and plaintiff, would buy the items on cash basis at ex-factory
price, a privilege not given to customers, and thereafter required the customer to sign promissory notes
and other documents using the name and property of plaintiff, purporting that said customer purchased
the items from plaintiff on installment basis. Thereafter, defendant collected the installment payments
either personally or through Venus Lozano, a Group Sales Manager of plaintiff but also utilized by him as
secretary in his own business for collecting and receiving of installments, purportedly for the plaintiff
but in reality on his own account or business. In declaring itself as having jurisdiction over the subject
matter of the instant controversy, respondent court stated: A perusal of the complaint which is for
damages does not ask for any relief under the Labor Code of the Philippines. It seeks to recover
damages as redress for defendant's breach of his contractual obligation to plaintiff who was damaged
and prejudiced. The Court believes such cause of action is within the realm of civil law, and jurisdiction
over the controversy belongs to the regular courts. However, Banez put up the defense of Lack of
jurisdiction.

Issue: Who had jurisdiction?

Ruling: Presently, and as amended by R.A. 6715, the jurisdiction of Labor Arbiters and the NLRC in
Article 217 is comprehensive enough to include claims for all forms of damages "arising from the
employer-employee relations". There is no mistaking the fact that in the case before us, private
respondent's claim against petitioner for actual damages arose from a prior employer-employee
relationship. In the first place, private respondent would not have taken issue with petitioner's "doing
business of his own" had the latter not been concurrently its employee. Thus, the damages alleged in
the complaint below are: first, those amounting to lost profits and earnings due to petitioner's
abandonment or neglect of his duties as sales manager, having been otherwise preoccupied by his
unauthorized installment sale scheme; and second, those equivalent to the value of private
respondent's property and supplies which petitioner used in conducting his "business ".

Second, and more importantly, to allow respondent court to proceed with the instant action for
damages would be to open anew the factual issue of whether petitioner's installment sale scheme
resulted in business losses and the dissipation of private respondent's property. This issue has been duly
raised and ruled upon in the illegal dismissal case, where private respondent brought up as a defense
the same allegations now embodied in his complaint, and presented evidence in support thereof. The
Labor Arbiter, however, found to the contrary ---that no business losses may be attributed to petitioner
as in fact, it was by reason of petitioner's installment plan that the sales of the Iligan branch of private
respondent (where petitioner was employe. Clearly, respondent court's taking jurisdiction over the
instant case would bring about precisely the harm that the lawmakers sought to avoid in amending the
Labor Code to restore jurisdiction over claims for damages of this nature to the NLRC.

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

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

76. Eviota vs CA (Mamugay)

Facts: Respondent Standard Chartered Bank and petitioner Eduardo G. Eviota executed a contract of
employment under which the petitioner was employed by the respondent bank as Compensation and
Benefits Manager, VP. However, the petitioner abruptly resigned from the respondent bank barely a
month after his employment and rejoined his former employer.
Respondent bank filed a complaint against petitioner with the RTC Makati. Bank contended that
it incurred expenses in conjunction with the terms in the contract and as a commitment to Eviota since
the latter showed commitment to the Bank. The bank even allowed Eviota access to certain sensitive
and confidential information and documents concerning the banks operation. However, Eviota
suddenly resigned and did not comply with the 30-day prior notice rule under the law and under the
Employment Contract. It forced the Bank to hire the services of a third party to perform the job he was
hired to do.
The bank contends that it was simply used by Eviota as a mere leverage for his selfish efforts at
negotiating better terms of employment with his previous employer. Worse, there is evidence to show
that in his attempts to justify his hasty departure from the Bank and conceal the real reason for his
move, Eviota has resorted to falsehoods derogatory to the reputation of the Bank.
Bank made a written demand on Eviota to return the computer diskette containing sensitive
info and other confidential documents and papers, reimburse the Bank for the various expenses
incurred on his account as a result of his resignation (with legal interest), and pay damages in the
amount of at least P500,000.00 for the inconvenience and work/program disruptions suffered by the
Bank. Eviota complied with some except the reimbursement of other expenses amounting to more than
P300,000. Hence, this complaint by the bank.
Eviota contends that the action is within the jurisdiction of Labor Arbiter under paragraph 4,
Article 217 of the Labor Code. That the respondent banks claim for damages arose out of or were in
connection with his employer-employee relationship with the respondent bank or some aspect or
incident of such relationship.
Bank contends that its action for damages was within the exclusive jurisdiction of the trial
court.

Issue: Is the petitioner correct in saying that Labor Arbiter has jurisdiction and not RTC?

Ruling: No, petitioner is incorrect. A money claim by a worker against the employer or vice-versa is
within the exclusive jurisdiction of the labor arbiter only if there is a reasonable causal connection
between the claim asserted and employee-employer relation. Absent such a link, the complaint will be
cognizable by the regular courts of justice.
The causes of action of the private respondent against the petitioner do not involve the
provisions of the Labor Code of the Philippines and other labor laws but the New Civil Code. There is no
causal relationship between the causes of action of the private respondents against the petitioner and
their employer-employee relationship.
The claims in this case were the natural consequences flowing from a breach of an obligation,
intrinsically civil in nature.
Note: please check full text of the three causes of action if necessary, as well as the itemized list of
expenses allegedly incurred by bank. Taas man.
78. Austria v. NLRC (Batulan)
G.R. No. 124382 August 16, 1999

KTA: Relationship of the church as an employer and the minister as an employee is purely secular in
nature because it has no relation with the practice of faith, worship or doctrines of the church, such
affairs are governed by labor laws. The Labor Code applies to all establishments, whether religious or
not.

Facts:The Seventh Day Adventists(SDA) is a religious corporation under Philippine law. The petitioner
was a pastor of the SDA for 28 years from 1963 until 1991, when his services were terminated.

On various occasions from August to October 1991, Austria received several communications form
Ibesate, the treasurer of the Negros Mission, asking him to admit accountability and responsibility for
the church tithes and offerings collected by his wife, Thelma Austria, in his district and to remit the same
to the Negros Mission.

The petitioner answered saying that he should not be made accountable since it was Pastor Buhat and
Ibesate who authorized his wife to collect the tithes and offerings since he was very ill to be able to do
the collecting.

A fact-finding committee was created to investigate. The petitioner received a letter of dismissal citing:
1) Misappropriation of denominational funds;
2) Willful breach of trust;
3) Serious misconduct;
4) Gross and habitual neglect of duties; and
5) Commission of an offense against the person of employer's duly authorized representative
as grounds for the termination of his services.

Petitioner filed a complaint with the Labor Arbiter for illegal dismissal, and sued the SDA
for reinstatement and backwages plus damages. Decision was rendered in favor of petitioner.

SDA appealed to the NLRC. Decision was rendered in favor of respondent.

Issue:

1. Whether or not the termination of the services of the petitioner is an ecclesiastical affair, and, as
such, involves the separation of church and state.

2. Whether or not the Labor Arbiter/NLRC has jurisdiction to try and decide the complaint filed by
petitioner against the SDA.

Ruling:

1. No. The matter at hand relates to the church and its religious ministers but what is involved here is
the relationship of the church as an employer and the minister as an employee, which is purely
secular because it has no relationship with the practice of faith, worship or doctrines. The grounds
invoked for petitioners dismissal are all based on Art. 282 of Labor Code.

2. Yes. SDA was exercising its management prerogative (not religious prerogative) to fire an employee
which it believes is unfit for the job. It would have been a different case if Austria was expelled or
excommunicated from the SDA.

80. ALBERTO SILVAvs NLRC (Karen D)


FACTS: Sometime in 1985, petitioners, then rank-and-file employees and members of Philtread Workers
Union (PWU), volunteered for, and availed of, the retrenchment program instituted by Philtread with
the understanding that they would have priority in re-employment in the event that the company
recovers from its financial crisis, in accordance with Section 4, Article III of the CBA concluded on July 5,
1983.
In November 1986, Philtread, apparently having recovered from its financial reverses, expanded its
operations and hired new personnel. Upon discovery of this development, petitioners filed their
respective applications for employment with Philtread, which however, merely agreed to consider them
for future vacancies. Subsequent demands for re-employment made by petitioners were ignored. Even
the request of the incumbent union for Philtread to stop hiring new personnel until petitioners were
first hired failed to elicit any favorable response.Thus petitioners lodged a complaintwith the NCR
Arbitration Branch of the NLRC for unfair labor practice (ULP), damages and attorneys fees against
Philtread.
Philtread moved for the dismissal of the complaint based on two grounds, namely: (1) that the NLRC
lacked jurisdiction, there being no employer-employee relationship between it and petitioners and that
the basic issue involved was the interpretation of a contract, the CBA, which was cognizable by the
regular courts; and (2) that petitioners had no locus standi, not being privy to the CBA executed
between the union and Philtread.
Petitioners stressed that the complaint was one for ULP precipitated by the unjust and unreasonable
refusal of Philtread to re-employ them, as mandated by the provisions of Section 4, Article III of the 1986
and 1983 CBAs. Being one for ULP, petitioners concluded that the NLRC had jurisdiction over the case,
pursuant to Article 217 (a) (1) of the Labor Code.
In dismissing the complaint, the LAdid not tackle the jurisdictional issue posed by Philtread in its
position paper. Instead, he dwelt solely on the question whether the petitioners were entitled to priority
in re-employment on the basis of the CBA.
The NLRC issued a resolution reversing the decision of the Labor Arbiter. It directed Philtread to re-
employ petitioners and other employees similarly situated, regardless of age qualifications and other
pre-employment conditions, subject only to existing vacancies and a finding of good physical condition.

ISSUE: Did the Labor Arbiter and the NLRC validly acquire jurisdiction when both of them entertained
the complaint?

RULING: At the time petitioners filed their complaint on December 5, 1988, the governing provision of
the Labor Code with respect to the jurisdiction of the Labor Arbiter and the NLRC was Article 217 which
states:ART. 217. Jurisdiction of Labor Arbiters and the Commission. (a) The Labor Arbiters shall have the
original and exclusive jurisdiction to hear and decide within thirty (30) working days after submission of
the case by the parties for decision, the following cases involving all workers, whether agricultural or
non-agricultural:

1. Unfair labor practice cases;


2. Those that workers may file involving wages, hours of work and other terms and conditions of
employment;
3. All money claims of workers, including those based on non-payment or underpayment of wages,
overtime compensation, separation pay and other benefits provided by law or appropriate agreement,
except claims for employees compensation, social security, medicare and maternity benefits;
4. Cases involving household services; and
5. Cases arising from any violation of Article 265 of this Code, including questions involving the legality of
strikes and lockouts.
(b) The Commission shall have exclusive appellate jurisdiction over all cases decided by Labor Arbiters.
Articles 261 and 262, on the other hand, defined the jurisdiction of the voluntary arbitrator,

ART. 261. Grievance machinery. - Whenever a grievance arises from the interpretation or implementation
of a collective agreement, including disciplinary actions imposed on members of the bargaining unit, the
employer and the bargaining representative shall meet to adjust the grievance. Where there is no
collective agreement and in cases where the grievance procedure as provided herein does not apply,
grievances shall be subject to negotiation, conciliation or arbitration as provided elsewhere in this Code.
ART. 262. Voluntary arbitration. - All grievances referred to in the immediately preceding Article which are
not settled through the grievance procedure provided in the collective agreement shall be referred to
voluntary arbitration prescribed in said agreement: Provided, That termination disputes shall be governed
by Article 278 of this Code, as amended, unless the parties agree to submit them to voluntary arbitration.
Under the above provisions then prevailing, one can understand why petitioners lodged their complaint
for ULP with the Labor Arbiter. Philtreads refusal to re-employ them was tantamount to a violation of
the re-employment clause in the 1983 CBA which was also substantially reproduced in the 1986 CBA. At
the time, any violation of the CBA was unqualifiedly treated as ULP of the employer falling within the
competence of the Labor Arbiter to hear and decide. Thus:

ART. 248. Unfair labor practices of employers. - It shall be unlawful for an employer to commit
any of the following unfair labor practice:
(i) To violate a collective bargaining agreement.
On March 21, 1989, however, Republic Act 6715,or the so-called Herrera-Veloso Amendments, took
effect, amending several provisions of the Labor Code, including the respective jurisdictions of the Labor
Arbiter, the NLRC and the voluntary arbitrator. As a result, the present jurisdiction of the Labor Arbiter
and the NLRC is as follows:

ART. 217. Jurisdiction of Labor Arbiters and the Commission. - (a) Except as otherwise provided under this
Code the Labor Arbiters shall have original and exclusive jurisdiction to hear and decide, within thirty (30)
calendar days after the submission of the case by the parties for decision without extension, even in the
absence of stenographic notes, the following cases involving all workers, whether agricultural or non-
agricultural:
1. Unfair labor practice cases;
2. Termination disputes;
3. If accompanied with a claim for reinstatement, those cases that workers may file
involving wages, rates of pay, hours of work and other terms and conditions of
employment;
4. Claims for actual, moral, exemplary and other forms of damages arising from the
employer-employee relations;
5. Cases arising from any violation of Article 264 of this Code, including questions
involving the legality of strikes and lockouts; and
6. Except claims for Employees Compensation, Social Security, Medicare and maternity
benefits, all other claims, arising from employer-employee relations, including those of persons
in domestic or household service, involving an amount exceeding five thousand pesos
(P5,000.00) regardless of whether accompanied with a claim for reinstatement.
(b) The Commission shall have exclusive appellate jurisdiction over all cases decided by Labor
Arbiters.
(c) Cases arising from the interpretation or implementation of collective bargaining agreements and
those arising from the interpretation or enforcement of company personnel policies shall be disposed of
by the Labor Arbiter by referring the same to the grievance machinery and voluntary arbitration as may
be provided in said agreements.
while that of the voluntary arbitrator is defined in this wise:

ART. 261. Jurisdiction of Voluntary Arbitrators or panel of Voluntary Arbitrators. - The Voluntary
Arbitrator or panel of Voluntary Arbitrators shall have original and exclusive jurisdiction to hear and
decide all unresolved grievances arising from the interpretation or implementation of the Collective
Bargaining Agreement and those arising from the interpretation or enforcement of company personnel
policies referred to in the immediately preceding article. Accordingly, violations of a Collective Bargaining
Agreement, except those which are gross in character, shall no longer be treated as unfair labor practice
and shall be resolved as grievances under the Collective Bargaining Agreement. For purposes of this
article, gross violations of Collective Bargaining Agreement shall mean flagrant and/or malicious refusal
to comply with the economic provisions of such agreement.
ART. 262. Jurisdiction over other labor disputes. - The Voluntary Arbitrator or panel of Voluntary
Arbitrators, upon agreement of the parties, shall also hear and decide all other labor disputes including
unfair labor practices and bargaining deadlocks.
With the amendments introduced by RA 6715, it can be gleaned that the Labor Arbiter still retains
jurisdiction over ULP cases. There is, however, a significant change: The unqualified jurisdiction
conferred upon the Labor Arbiter prior to the amendment by RA 6715 has been narrowed down so that
violations of a CBA, except those which are gross in character, shall no longer be treated as unfair labor
practice but as grievances under the CBA. It is further stated that gross violations of CBA shall mean
flagrant and/or malicious refusal to comply with the economic provisions of such agreement. Hence, for
a ULP case to be cognizable by the Labor Arbiter, and the NLRC to exercise its appellate jurisdiction, the
allegations in the complaint should show prima facie the concurrence of two things, namely: (1) gross
violation of the CBA; AND (2) the violation pertains to the economic provisions of the CBA.
In several instances prior to the instant case, the Court already made its pronouncement that RA 6715 is
in the nature of a curative statute. As such, we it can be applied retroactively to pending cases.
Hence, we uphold the jurisdiction of the Labor Arbiter which attached to this case at the time of its
filing on December 5, 1988.

81. Sim vs. NLRC, GR No. 157376, October 2, 2007 (Javier)

Facts: Sim was a Filipina and a general manager of Equitable PCI-Bank in Italy. In 1999, she received a
letter informing her that she was dismissed due to loss of trust and confidence based on alleged
mismanagement and misappropriation of funds. Sim alleged that she withdrew the P3 million funds of
the bank and used it for Radio Pilipinas sa Roma, the radio program of the company. The company
countered that at that time the program was already off the air. The Labor Arbiter and the NLRC both
ruled that they had no jurisdiction. Since she was hired in a foreign and, the laws of the foreign land
should govern her.

Issue: What laws govern an Overseas Filipino Worker?

Ruling: Our labor laws still govern OFWs. Under Article 217 of the Labor Code it states that the Labor
Arbiter and the Commission have jurisdiction over disputes involving all workers. Section 10 of RA 8042
also gave NLRC jurisdiction over claims arising out of employer-employee relationship or by virtue of
any law or contract involving Filipino workers for overseas deployment including claims for actual,
moral, exemplary and other forms of damages. Also, Section 62 of the Omnibus Rules and Regulations
Implementing R.A. No. 8042 provides that the Labor Arbiters of the NLRC shall have the original and
exclusive jurisdiction to hear and decide all claims arising out of employer-employee relationship or by
virtue of any law or contract involving Filipino workers for overseas deployment including claims for
actual, moral, exemplary and other forms of damages, subject to the rules and procedures of the NLRC.
Principle: Whether employed locally or overseas, all Filipino workers enjoy the protective mantle of
Philippine labor and social legislation, contract stipulations to the contrary notwithstanding.

82. HSBC Limited Staff Retirement Plan vs. Sps. Broqueza (R-U, Glenna)

Facts: Petitioners Gerong and Editha Broqueza are employees of HSBC. They are also members of HSBC
Ltd. Staff Retirement Plan. The Plan is a retirement plan established by HSBC through its BOT for the
benefit of the employees. On Oct. 1, 1990, petitioner Broqueza obtained a car loan in the amount of
Php175,000. Petitioner Gerong, on the other hand, applied and was granted an emergency loan in the
amount of Php35,780 on June 2, 1993. The loans were paid through automatic salary deductions.

A labor dispute arose between HSBC and its employees.

Majority of the HSBC employees were terminated, among them were petitioners. The employees filed
an illegal dismissal case before the NLRC against HSBC, which is now pending before the CA. Because of
the dismissal, petitioners were not able to pay the monthly amortizations of their respective loans. They
were considered delinquent. Demands to pay were made.

On July 31, 1996, HSBC-SRP filed a civil case against the spouses.

On Sept. 19, 1996, HSBCL-SRP filed another civil case. Both suits were civil actions for recovery and
collections of sums of money.

The McTC ruled that the nature of HSBCs demands for payment is civil and has no connection to the
ongoing labor dispute. The loans secured by their future retirement benefits to which they are no longer
entitled are reduced to unsecured and pure civil obligations. They are immediately demandable.

The RTC affirmed the decision, but the CA reversed.

On Aug. 6, 2007, HSBCL-SRP filed a manifestation withdrawing the petition against Gerong because she
already settled her obligation.

Issue: WON the loans of the Sps. Broqueza is a pure obligation and demandable even if they were
dismissed by HSBC.

WON within the jurisdiction of the Labor Arbiter.

Ruling: The RTC is correct in ruling that since the Promissory Notes do not contain a period, HSBCL-SRP
has the right to demand immediate payment.

Article 1179 applies.

The spouses obligation to pay is a pure obligation because they do not contain a period.

Once Editha Broqueza defaulted in her monthly payment, HSBCL-SRP made a demand to enforce a pure
obligation. Despite the spouses Broquezas protestation, the payroll deduction is merely a convenient
mode of payment and not the sole source of payment of the loan.
ENFORCEMENT OF A LOAN AGREEMENT INVOLVES DEBTOR-CREDITOR RELATIONSHIP FOUNDED ON
CONTRACT AND DOES NOT IN ANY WAY CONCERN THE EMPLOYEE RELATIONS. IT SHOULD BE ENFORCED
THROUGH A SEPARATE CIVIL ACTION IN THE REGULAR COURTS AND NOT THE LABOR ARBITER.

83. Halaguea, et al. vs PAL (Derrama)

Facts: Petitioners were employed as flight attendants of respondent on different dates prior to
November 1996. They are members of FASAP union exclusive bargaining organization of the
flightattendants, flight stewards and pursers. On July 2001, respondent and FASAP entered into a CBA
incorporating the terms and conditions of their agreement for the years 2000 to 2005 (compulsory
retirement of 55 for female and 60 for males).

In July 2003, petitioner and several female cabin crews, in a letter, manifested that the provision in CBA
on compulsory retirement is discriminatory. On July 2004, petitioners filed a Special Civil Action for
Declaratory Relief with issuanceof TRO with the RTC Makati. The RTC issued a TRO. After the denial of
the respondent on itsmotion for reconsideration for the TRO, it filed a Petition with the CA. CA granted
respondents petition and ordered lower court to dismiss the case. Hence, this petition.

Issue: Whether or not the regular courts has jurisdiction over the case.

Ruling: Yes. The subject of litigation is incapable of pecuniary estimation, exclusively cognizable by the
RTC. Being an ordinary civil action, the same is beyond the jurisdiction of labor tribunals.

Not every controversy or money claim by an employee against the employer or vice-versa is within the
exclusive jurisdiction of the labor arbiter. Actions between employees and employer where the
employer-employee relationship is merely incidental and the cause of action precedes from a different
source of obligation is within the exclusive jurisdiction of the regular court.

Being an ordinary civil action, the same is beyond the jurisdiction of labor tribunals.The said issue cannot
be resolved solely by applying the Labor Code. Rather, it requires the application of the Constitution,
labor statutes, law on contracts and the Convention on the Elimination of All Forms of Discrimination
Against Women, and the power to apply and interpret the constitution and CEDAW is within the
jurisdiction of trial courts, a court of general jurisdiction. In GeorgGrotjahn GMBH & Co. v. Isnani, this
Court held that not every dispute between an employer and employee involves matters that only labor
arbiters and the NLRC can resolve in the exercise of their adjudicatory or quasi-judicial powers. The
jurisdiction of labor arbiters and the NLRC under Article 217 of the Labor Code is limited to dispute
arising from an employer-employee relationship which can only be resolved by reference to the Labor
Code other labor statutes, or their collective bargaining agreement.

84. Leslie Okol vs. Slimmers World International (Gallo)

FACTS: Slimmers World employed petitioner Leslie Okol (Okol) as a management trainee. She rose up
the ranks to become Head Office Manager and then Director and Vice President from 1996 until her
dismissal on 22 September 1999. Prior to Okols dismissal, Slimmers World preventively suspended her
due to the seizure by the Bureau of Customs of 7 Precor elliptical machines and 7 Precor treadmills
belonging to or consigned to Slimmers World. The shipment of the equipment was placed under the
names of Okol and two customs brokers for a value less than US$500. For being undervalued, the
equipment were seized. After Okols unsatisfactory explanation of the incident, Slimmers World
eventually terminated her employment. Okol filed a complaint with the Arbitration branch of the NLRC
for illegal suspension, illegal dismissal, unpaid commissions, damages and attorneys fees, with prayer
for reinstatement and payment of backwages.

Respondents asserted that the NLRC had no jurisdiction over the subject matter of the complaint. The
labor arbiter ruled that Okol was the vice-president of Slimmers World at the time of her dismissal
and since it involved a corporate officer, the dispute was an intra-corporate controversy falling outside
the jurisdiction of the Arbitration branch. On appeal, the NLRC ruled in favor of Okol and ordered her
reinstatement. In the CA, however, the order of the labor arbiter was affirmed and ruled that the case,
being an intra-corporate dispute, falls within the jurisdiction of the regular courts pursuant to RANo.
8799.

Petitioner insists that the CA erred in ruling that she was a corporate officer and that the case is an intra-
corporate dispute falling within the jurisdiction of the regular courts. She asserts that even as vice-
president, the work that she performed conforms to that of an employee rather than a corporate
officer. Mere title or designation in a corporation will not, by itself, determine the existence of an
employer-employee relationship. It is the four-fold test which must be applied.

Respondents, on the other hand, maintain that petitioner was a corporate officer at the time of her
dismissal as supported by the General Information Sheet and Directors Affidavit attesting that petitioner
was an officer.

ISSUE: Whether or not the NLRC has jurisdiction over the illegal dismissal case filed by petitioner

RULING: The appellate court correctly ruled that it is not the NLRC but the regular courts which have
jurisdiction over the present case. From the documents submitted by respondents, petitioner was a
director and officer of Slimmers World. The charges of illegal suspension, illegal dismissal, unpaid
commissions, reinstatement and backwages imputed by petitioner against respondents fall squarely
within the ambit of intra-corporate disputes. In a number of cases, we have held that a corporate
officers dismissal is always a corporate act, or an intra-corporate controversy which arises between a
stockholder and a corporation. The question of remuneration involving a stockholder and officer, not a
mere employee, is not a simple labor problem but a matter that comes within the area of corporate
affairs and management and is a corporate controversy in contemplation of the Corporation Code. It is a
settled rule that jurisdiction over the subject matter is conferred by law. The determination of the rights
of a director and corporate officer dismissed from his employment as well as the corresponding liability
of a corporation, if any, is an intra-corporate dispute subject to the jurisdiction of the regular courts.

89. Pentagon Steel Corporation (Julius)

Facts: Pentagon Steel alleged that Balogo was absent from work without giving prior notice from Aug. 7
to Aug. 21, 2002. Pentagon Steel sent a letter via registered mail to Balogo requiring him to explain.
Balogo did not respond. Thus, Pentagon Steel considered Balogo on Absent Without Official Leave
(AWOL). On Sept. 13, 2002, Balogo filed a complaint for nonpayment of salaries, etc. and illegal
dismissal. According to Balogo, he was ill (flu, diarrhea, LBM) at that time, and when he reported back
for work on Aug. 17, 2002 with a doctor's note, Pentagon Steel did not allow him to resume work. The
Court of Appeals considered the proceedings during the mandatory preliminary conference of this case.

Issue: Can the proceedings during the preliminary conference be used as basis for the judgment?

Ruling: No. Under Art. 233 of the Labor Code, the information adn statements made at conciliation
proceedings shall be treated as privileged communication and shall not be used as evidence in the
Commission. First, if every offer to "buy peace" through conciliation could be used as evidence against a
person who presents it, many settlements would be prevented and unnecessary litigation would result.
Second, offers for compromise are not intended as admissions by the parties making them.

Issue: Did Balogo abandon his job?

Ruling: No. Balogo had a valid reason for being absent from work. A written explanation aside from the
doctor's note would have been superfluous. Pentagon failed to justify why it refused to accept Balogo
despite the doctor's note.

Issue: Was there constructive dismissal?

Ruling: Yes, because he was not accepted back to work despite having a valid reason for his absence.