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Chapter 9-1


G.R. No. 91980 June 27, 1991


FACTS: The controversy at bar had its origin in the "wage distortions" affecting the employees of
respondent San Miguel Corporation allegedly caused by Republic Act No. 6727, otherwise known as the
Wage Rationalization Act. Upon the effectivity of the Act, the union known as "Ilaw at Buklod Ng
Manggagawa (IBM)" said to represent 4,500 employees of San Miguel Corporation, more or less,
"working at the various plants, offices, and warehouses located at the National Capital Region" presented
to the company a "demand" for correction of the "significant distortion in . . . (the workers') wages." In that
"demand," the Union explicitly invoked Section 4 (d) of RA 6727 which reads as follows: xxx xxx xxx

(d) . . .Where the application of the increases in the wage rates under this Section results in
distortions as defined under existing laws in the wage structure within an establishment and gives rise to a
dispute therein, such dispute shall first be settled voluntarily between the parties and in the event of a
deadlock, the same shall be finally resolved through compulsory arbitration by the regional branches of the
National Labor Relations Commission (NLRC) having jurisdiction over the workplace…

The Union claims that demand was ignored. In this connection, the workers involved issued a joint
notice reading as follows:



That decision to observe the "eight hours work shift" was implemented on October 16, 1989 by
"some 800 daily-paid workers at the Polo Plant's production line of SMC] joined by others at statistical
quality control and warehouse. There ensued thereby a change in the work schedule which had been
observed by daily-paid workers at the Polo Plant for the past five (5) years, i.e. "ten (10) hours for the first
shift and ten (10) to fourteen (14) hours for the second shift, from Mondays to Fridays . . ; (and on)
Saturdays, . . eight (8) hours for both shifts" a work schedule which, SMC says, the workers had
"welcomed, and encouraged" because the automatic overtime built into the schedule "gave them a steady
source of extra-income," and pursuant to which it (SMC) "planned its production targets and budgets.

This abandonment of the long-standing schedule of work and the reversion to the eight-hour shift
apparently caused substantial losses to SMC. It is SMC's submittal that the coordinated reduction by the
Union's members of the work time theretofore willingly and consistently observed by them, causing
financial losses to the employer in order to compel it to yield to the demand for correction of "wage
distortions," is an illegal and "unprotected" activity.

ISSUE: Whether or not the strike is illegal?

RULING: YES. Among the rights guaranteed to employees by the Labor Code is that of engaging in
concerted activities in order to attain their legitimate objectives. The more common of these concerted
activities as far as employees are concerned are: strikes- the temporary stoppage of work as a result of an
industrial or labor dispute. On the other hand, the counterpart activity that management may licitly
undertake is the lockout- the temporary refusal to furnish work on account of a labor dispute, Article 263
provides that the "right of legitimate labor organizations to strike and of employer to lockout, consistent
with the national interest, shall continue to be recognized and respected." The legality of these activities is
usually dependent on the legality of the purposes sought to be attained and the means employed therefor.It
goes without saying that these joint or coordinated activities may be forbidden or restricted by law or

Section 3 of Republic Act No. 6727 prescribes a specific, detailed and comprehensive procedure
for the correction thereof, thereby implicitly excluding strikes or lockouts or other concerted activities as
modes of settlement of the issue. The provision states that:

xxx … the employer and the union shall negotiate to correct the distort-ions. Any dispute arising
from wage distortions shall be resolved through the grievance procedure under their collective bargaining
agreement and, if it remains unresolved, through voluntary arbitration…

Furthermore, Section 16, Chapter I of the implementing rules of said law… declares that, "Any
issue involving wage distortion shall not be a ground for a strike/lockout."

Moreover, the worker’s concerted refusal to adhere to the work schedule in force is a slowdown, an
inherently illegal activity even in the absence of a no strike clause because while the employees continue to
work and remain at their positions and accept their wages, they at the same time select part of the work
they care to perform at their own volition or in their own terms.

Chapter 9-2


GRN 106316, 272 SCRA 124 (May 5, 1997)

Facts: Petitioner First City Interlink Transportation Co, Inc is a public utility while respondent
Nagkakaisang Manggagawa ng Fil Transit-National Federation of Labor is the labor union of Fil Transit
employees. The union filed a notice of strike with the BLR for ULP against petitioner. The parties failed to
reach an agreement so that the union went on strike. Consequently, several workers were dismissed. The
union filed another notice of strike alleging ULP, massive dismissal of union officers and members,
coercion of employees and violation of workers' rights to self-organization. Conciliation conferences were
held but the union again went on strike. The MOLE ordered the striking workers to return to work. Only 66
employees were accepted by petitioner conditioned on the submission of certain requirements. The
Secretary of Labor ruled for the legality of the strike and awarded backwages and separation pay to the
strikers. Petitioner alleged that no strike vote was obtained, the result thereof was not reported to the
MOLE, the strikers engaged in violent, illegal and criminal acts, and it complied with the return to work

Issue: WON the strike was illegal.

Held: Yes. It was not shown in the pleadings that a strike vote was obtained before the declaration of
strike. The statement in the same order of the Labor Secretary that a notice of strike had been filed because
several conciliation conferences failed due to management's consistent refusal to appear is contrary to
evidence because management was duly represented during the conciliation proceedings prior to the strike.
Further, the union failed to comply with the required 7-day strike ban. The union was in bad faith when it
conducted the strike because instead of attending the conciliation meetings with petitioner, it went on
strike. The strike was attended by pervasive and widespread violence such as the hijacking of Fil-Transit
buses, barricading of the terminal in Alabang, puncturing of tires, cutting of electric wirings, water hoses
and fan belts, use of Molotov bombs, and theft of expensive equipment such as fuel injections. The
commission of these illegal acts was neither isolated nor accidental but deliberately employed to intimidate
and harass the employer and the public. However, only the union officers and strikers who engaged in
violent, illegal and criminal acts against the employer are deemed to have lost their employment status.
Union members who were merely instigated to participate in the illegal strike should be treated differently.
Some requirements in the reinstatement of the striking workers were unreasonable considering that the
strikers were not being hired for the first time but merely being reinstated. These are the P1T cash bond,
birth/baptismal certificate, residence certificate, high school diploma or transcript of records, certification
of employment, and marriage contract. But the requirement to submit NBI, Police and Barangay clearances
is reasonable to enable management to determine whether the returning employees have pending charges
of illegal acts especially those committed during the strike. The driver's and conductor's/conductress'
license is also reasonable to enable them to perform their tasks. The pictures are necessary for the
employer's personnel records. The medical examination is justified to ensure that the employees are
physically fit to resume the performance of their duties since it has been 2 years from the time of their
dismissal. The imposition of such requirements did not amount to a refusal to admit workers back or an
illegal lock-out so as to entitle them to payment of backwages. In fact, none of such employees was refused

Chapter 9-3
[G.R. No. 153664. July 18, 2003]



On June 15, 1990, the petitioner and the respondent union entered into and signed a third CBA
covering the period of July 10, 1988 to July 9, 1991. On September 27, 1990, the respondent union filed a
notice of strike. The matter was referred to the NCMB for resolution.
Meanwhile, on October 16, 1990, Michael Wilson, the petitioner’s general manager, wrote the
Secretary of Labor informing him of the petitioner’s decision to retrench seventeen less senior employees
to lessen the daily financial losses being incurred by the petitioner.
The next day, the respondent union, through its president, informed the DOLE-NCR that the union
will conduct a strike vote referendum on October 23 and 24, 1990. The members of the respondent union
voted to stage a strike. On October 25, 1990, the respondent union informed the DOLE-NCR of the results
of the strike vote referendum. On October 31, 1990, the SOLE issued another status quo ante bellum order
certifying the case to the NLRC for compulsory arbitration and enjoining the parties from engaging in any
strike or lockout.
The petitioner wrote the SOLE of its decision to implement its retrenchment program to stem its
huge losses. It terminated the employment of sixty employees and two officers of the respondent union
effective December 6, 1990. On November 7, 1990, the respondent union protested the actions of the
petitioner invoking Section 15, Article VI of the CBA. The respondent union filed an urgent motion for a
reconsideration by the SOLE of the Certification Order dated October 31, 1990. On November 14, 1990,
the petitioner terminated the employment of eighty-six more employees effective December 14, 1990. The
remaining employees were also informed that it will close in six months. On November 14, 1990, the
petitioner terminated the employment of Kristoffer So, effective December 14, 1990.
By way of riposte, the respondent union filed on November 16, 1990 another notice of strike
because of what it perceived as the petitioner’s continuing unfair labor practices (ULP). On the same day,
at about 12:00 noon, the officers of the respondent union and some members staged a picket in the
premises of the hotel, obstructing the free ingress and egress thereto. At 3:00 p.m., the police operatives of
the Western Police District arrived and dispersed the picket line. Police officers detained the respondent
union’s president Rogelio Soluta, Henry Baybay and Dennis Cosico. On November 17, 1990, the

petitioner sent identical letters to the officers and members of the respondent union terminating their
On February 1, 1991, the petitioner filed a complaint with the Regional Arbitration Office of the
NLRC for illegal strike against the union, its members and officers
The respondents denied the material allegations of the complaint and alleged that the petitioner
committed unfair labor practices prior to the filing of the November 16, 1990 notice of strike. Hence, there
was no need for the respondent union to comply with Articles 263 and 264 of the Labor Code, as the notice
filed by the union on September 27, 1990 was sufficient compliance with the law.
Both the Labor Arbiter and the NLRC declared the strike held on November 16, 1990 illegal for
failure of the union to comply with the requirements laid down in Article 263 and 264 of the Labor Code.
However, the Court of appeals reversed the decision and held, taking into account the observation of the
Solicitor General, that the petitioner retrenched employees pending the resolution of the certified cases
respecting the alleged illegal suspension and dismissals effected by the petitioner during and prior to the
notices of strike filed by the union. The Solicitor General opined that even if the strike was staged without
the proper notice and compliance with the cooling-off period, resort thereto was simply triggered by the
union’s belief in good faith that petitioner was engaged in ULP.

Was the strike held on November 16, 1990 illegal?


YES. In this case, the respondent union filed its notice of strike with the DOLE on November 16, 1990
and on the same day, staged a picket on the premises of the hotel, in violation of the law. Police operatives
of the Western Police District had to disperse the picketers and take into custody Union President Rogelio
Soluta and the other officers of respondent union, Henry Babay and Dennis Cosico. The respondents
cannot argue that since the notice of strike on November 16, 1990 were for the same grounds as those
contained in their notice of strike on September 27, 1990 which complied with the requirements of
the law on the cooling-off period, strike ban, strike vote and strike vote report, the strike staged by
them on November 16, 1990 was lawful. The matters contained in the notice of strike of September 27,
1990 had already been taken cognizance of by the SOLE when he issued on October 31, 1990 a status quo
ante bellum order enjoining the respondent union from intending or staging a strike. Despite the SOLE
order, the respondent union nevertheless staged a strike on November 16, 1990 simultaneously with its
notice of strike, thus violating Article 264(a) of the Labor Code of the Philippines.
While it may be true that the petitioner itself barred the officers of the respondent union from working
and had terminated the employment of Kristoffer So, and sent out circulars of its decision to retrench its
employees effective December 16, 1990, the same were not valid justifications for the respondents to do
away with the statutory procedural requirements for a lawful strike. It behooved the respondents to avail
themselves of the remedies under the CBA or file an illegal dismissal case in the office of the Labor Arbiter
against the petitioner or by agreement of the parties, submit the case to the grievance machinery of the
CBA so that the matter may be subjected to voluntary arbitrary proceedings instead of resorting to an
immediate strike.There was no immediate and imperative need for the respondents to stage a strike on the
very day that the notice of strike on November 16, 1990 was filed because the retrenchment envisaged by
the petitioner had yet to take effect on December 14, 1990. The grievances of the respondent union could
still very well be ordered and acted upon by the SOLE before December 14, 1990.
The respondents’ claim of good faith is not a valid excuse to dispense with the procedural steps
for a lawful strike. Hence, the need for a union to adhere to and comply strictly with the procedural
conditions sine qua non provided for by the law in staging a strike.

Chapter 9-4

Association of Independent Unions
in the Philippines vs NLRC
305 SCRA 219

FACTS: In CENAPRO Chemicals Corporation, the collective bargaining representative of all rank
and file employees was CENAPRO Employees Association (CCEA) with which respondent company had
a collective bargaining agreement. Their CBA excluded casual employees from membership in the
incumbent union. The casual employees who have rendered at least one to six years of service sought
regularization of their employment. When their demand was denied, they formed themselves into an
organization and affiliated with the Association of Independent Unions of the Philippines. Thereafter, AIUP
filed a petition for certification election, which petition was opposed by the respondent company. The
CCEA anchored its opposition on the contract bar rule.
The union filed a notice of strike, minutes of strike vote, and the needed documentation
with the DOLE. The notice of strike cited as grounds there for the acts of respondent company constituting
unfair labor practice, more specifically coercion of employees and systematic union busting.
The union proceeded to stage a strike, in the course of which, the union perpetrated illegal
acts. The strikers padlocked the gate of the company. The areas fronting the gate of the company were
barricaded and blocked by union strikers. The strikers also prevented and coerced other non-striking
employees from reporting for work. Because of such illegal activities, the respondent company filed a
petition for injunction with the NLRC, which granted a Temporary Restraining Order, enjoining the
strikers from doing further acts of violence, coercion, or intimidation and from blocking free ingress and
egress to company premises.
The respondent company filed a complaint for illegal strike. The petitioners filed a
complaint for unfair labor practice and illegal lockout against respondent company.
In a consolidated decision, the Labor Arbiter declared as illegal the strike staged by the
petitioners, and dismissed the charge of illegal lockout and unfair labor practice. The officers who
participated in the illegal strike and declared to have lost their employment status. CENAPRO is directed
however to reinstate the other workers and CENAPRO is being absolved from the charges of illegal
lockout and unfair labor practice.
The respondent company appealed the decision insofar as it ordered the reinstatement of
some of the strikers. The petitioners also appealed the same decision of the Labor Arbiter.
NLRC affirmed in toto the Labor Arbiter’s decision. Respondent company moved for
reconsideration of that portion of the NLRC’s decision ordering the reinstatement of the said strikers.
Acting thereupon, the NLRC modified its decision, by ordering the payment of separation pay in lieu of
the reinstatement of the petitioners, deleting the award of backwages, and the declaring the loss of
employment status of one petitioner.

ISSUE: Whether or not the strike is valid.

HELD: No. When they filed the notice of strike, petitioners cited as their grounds there for unfair
labor practice, specifically coercion of employees and systematic union busting. But the said grounds were
adjudged as baseless by the Labor Arbiter.
It is undisputed that at the time the petition for certification election was filed by AIUP, the
petitioner union, there was an existing CBA between the respondent company and CCEA, the incumbent
bargaining representative of all rank and file employees. The petition should not have been entertained
because of the contract bar rule.
The strike staged by the petitioner union was illegal for the reasons that (1)the strikers
committed illegal acts in the course of the strike. (2)And violated the TRO enjoining the union and/or its
members from obstructing the company premises and ordering the removal there from of all the barricades.
Even if the strike is valid because its objective or purpose is lawful, the strike may still be
declared invalid where the means employed are illegal.

The dismissal of the officers of the striking union was justified and valid. Their dismissal as
a consequence of the illegality of the strike staged by them finds support in Art. 264(a) of the Labor Code,
pertinent portion of which provides: “x x Any union officer who knowingly participates in the commission
of illegal acts during a strike may be declared to have lost his employment status. x x”.
Union officers are duty bound to guide their members to respect the law. If instead of doing
so, the officers urge the members to violate the law and defy the duly constituted authorities, their
dismissal from the service is a just penalty or sanction for their unlawful acts. The officers’ responsibility is
greater than that of the members.
An ordinary striking employee can not be terminated by mere participation in an illegal
strike. There must be proof that he committed illegal acts during the strike and the striker who participated
in the commission of the illegal act must be identified.

Chapter 9-5


G.R. No. 95494 September 7, 1995; 248 SCRA 95


Private respondents are sister companies engaged in the production of bananas. Their agricultural
establishments are located in Davao City.
On the other hand, petitioner Lapanday Workers' Union (Union) is the duly certified bargaining
agent of the rank and file employees of private respondents. The Union is affiliated with the KMU-
ANGLO. The other petitioners are all members of the Union.
Petitioner Union has a collective bargaining agreement with private respondents, covering the
period from December 5, 1985 to November 30, 1988. A few months before the expiration of their CBA,
private respondents initiated certain management policies which disrupted the relationship of the parties.
Issues were discussed during a labor-management meeting held on August 2, 1988. After private
respondents explained the issues, the Union agreed to allow its members to attend the HDIR seminar for
the rank-and-filers. Nevertheless, on August 19 and 20, the Union directed its members not to attend the
seminars scheduled on said dates. Earlier on, or on August 6, 1988, the Union, led by petitioners Arquilao
Bacolod and Rene Arao, picketed the premises of the Philippine Eagle Protectors to show their displeasure
on the hiring of the guards.
Worse still, the Union filed on August 25, 1988, a Notice of Strike with the National Conciliation
and Mediation Board (NCMB). It accused the company of unfair labor practices consisting of coercion of
employees, intimidation of union members and union-busting.
The NCMB called a conciliation conference. With the apparent settlement of their differences,
private respondents notified the NCMB that there were no more bases for the notice of strike.
Danilo Martinez, a member of the Board of Directors of the Union. The gunman was later
identified as Eledio Samson, an alleged member of the new security forces of private respondents.
On September 9, 1988, the day after the killing, most of the members of the Union refused to report
for work. They returned to work the following day but they did not comply with the "quota system"
adopted by the management to bolster production output. Allegedly, the Union instructed the workers to
reduce their production to thirty per cent (30%). Private respondents charged the Union with economic
sabotage through slowdown.
On September 14, 1988, Private respondents filed separate charges against the Union and its
members for illegal strike, unfair labor practice and damages, with prayer for injunction.
On October 3, 1988, a strike vote was conducted among the members of the Union and those in
favor of the strike won overwhelming support from the workers. The result of the strike vote was then
submitted to the NCMB on October 10, 1988. Two days later, or on October 12, 1988, the Union struck.
Labor Arbiter Antonio Villanueva ruled that the Onion staged an illegal strike.

Whether or not the strike staged on October 12, 1988 was illegal.

Paragraphs (c) and (f) of Article 263 of the Labor Code, as amended by E.O. 111, provides:
xxx. In every case, the union or the employer shall furnish the Ministry the results of the voting at
least seven (7) days before the intended strike or lockout subject to the cooling-off period herein provided.
We rule that strike conducted by the union on October 12, 1988 is plainly illegal as it was held within the
seven (7) day waiting period provided for by paragraph (f), Article 263 of the Labor Code, as amended.
The haste in holding the strike prevented the Department of Labor and Employment from verifying
whether it carried the approval of the majority of the union members. It set to naught an important policy
consideration of our law on strike. Considering this finding, we need not exhaustively rule on the legality
of the work stoppage conducted by the union and some of their members on September 9 and 23, 1988.
Suffice to state, that the ruling of the public respondent on the matter is supported by substantial evidence.
We affirm the decision of the public respondent limiting the penalty of dismissal only to the leaders of the
illegal strike. especially the officers of the union who served as its major players. They cannot claim good
faith to exculpate themselves. They admitted knowledge of the law on strike, including its procedure. They
cannot violate the law which ironically was cast to promote their interest.
We, likewise, agree with the public respondent that the union members who were merely instigated to
participate in the illegal strike should be treated differently from their leaders. Part of our benign
consideration for labor is the policy of reinstating rank-and-file workers who were merely misled in
supporting illegal strikes. Nonetheless, these reinstated workers shall not be entitled to backwages as they
should not be compensated for services skipped during the illegal strike.

Chapter 9-6


324 SCRA 242
1 February 2000


After the negotiations for the renewal of the collective bargaining agreement between petitioner union and
private respondent Moldex Products, Inc. ended in a deadlock, petitioner filed a notice of strike before the
National Conciliation and Mediation Board (NCMB). A strike vote was conducted, but the results thereof
were never submitted to NCMB. Petitioner went on strike. On private respondent’s petition, it was declared
as illegal by the Labor Arbiter. On appeal to the NLRC, the case was remanded for the Labor Arbiter for
reception of additional evidence, thus this petition.


Whether or not the strike staged by petitioner was illegal.


Yes, the strike was illegal.

Article 264 of the Labor Code provides in part that no strike shall be conducted without first having filed a
notice of strike or without first having filed a notice of strike, or without the necessary lockout or strike
vote first having been obtained and reported to the Ministry.

In this case, the result of the strike vote was not submitted to the NCMB making the strike staged illegal.
Also, they committed acts of violence, threats, coercion and intimidation during the strike.

The employment of the officers and of the members who committed prohibited acts in the course of the
strike were declared forfeited.

The NLRC resolution was set aside.

Chapter 9-7
National Federation of Sugar Workers vs. Ovejera
GR No. L-59743, May 31, 1982 ; 114 SCRA 354


National Federation of Sugar Workers (NFSW) has concluded with Central Azucarera de la Carlota (CAC)
a CBA effective February 16, 1981 to February 15, 1984 which provided that the parties agree to maintain
the present practice on the grant of Christmas bonus, milling bonus, and amelioration bonus to the extent
as the latter is required by law. The Christmas and milling bonuses amount to 1 ½ months' salary. On
November 28, 1981, NFSW struck allegedly, to compel the payment of the 13th month pay under PD 851,
in addition to the Christmas, milling and amelioration bonuses being enjoyed by CAC workers. On January
22, 1982, NFSW filed with the Ministry of Labor and Employment (MOLE) a notice of strike based on
non-payment of the 13th month pay. Six days after, NFSW struck. One day after the commencement of the
strike, a report of the strike-vote was filed by NFSW with MOLE. CAC filed a petition with the Regional
Arbitration Branch of MOLE to declare the strike illegal, principally for being violative of BP 130, that is,
the strike was declared before the expiration of the 15-day cooling-off period for ULP strikes, and the
strike was staged before the lapse of seven days from the submission to MOLE of the result of the strike-
vote After the submission of position papers and hearing, Labor Arbiter Ovejara declared the strike illegal.
On February 26, 1982, the NFSW, by passing the NLRC filed the instant Petition for prohibition.

ISSUE: Whether or not the strike declared by NFSW is illegal, the resolution of which mainly depends on
the mandatory or directory character of the cooling-off period and the 7-day strike ban after report to
MOLE of the result of a strike-vote, as prescribed in the Labor Code.

When the law says "the labor union may strike" should the dispute "remain unsettled until the lapse of the
requisite number of days (cooling-off period) from the filing of the notice," the unmistakable implication is
that the union may not strike before the lapse of the cooling-off period. Similarly, the mandatory character
of the 7-day strike ban after the report on the strike-vote is manifest in the provision that "in every case,"
the union shall furnish the MOLE with the results of the voting "at least seven (7) days before the intended
strike, subject to the (prescribed) cooling-off period." It must be stressed that the requirements of cooling-
off period and 7-day strike ban must both be complied with, although the labor union may take a strike
vote and report the same within the statutory cooling-off period.

If only the filing of the strike notice and the strike-vote report would be deemed mandatory, but not the
waiting periods so specifically and emphatically prescribed by law, the purposes for which the filing of the
strike notice and strike-vote report is required would not be achieved, as when a strike is declared
immediately after a strike notice is served, or when as in the instant case the strike-vote report is filed with
MOLE after the strike had actually commenced Such interpretation of the law ought not and cannot be
countenanced. It would indeed be self-defeating for the law to imperatively require the filing on a strike
notice and strike-vote report without at the same time making the prescribed waiting periods mandatory.

Chapter 9-8


GR NO. 88710-13. December 19. 1990


Facts: UFE filed a notice of strike with the BLR against Filipro (now, Nestle) and later filed a complaint
for ULP for violation of the Labor Code on Holiday Pay, non-implementation of the CBA provisions and
others. The Minister of Labor and Employment Blas Ople assumed jurisdiction over the dispute. UFE
assailed the same by filing a petition for certiorari with a prayer for the issuance of TRO. Notwithstanding
the automatic injunction and an absence of a restraining order, the union members staged a strike and
continued to man picket lines. The union officers and members distributed leaflets to employees and
passers-by advocating a boycott. Hence, Nestle filed a petition to declare the strike illegal. The Labor
Minister Ople issued another return to work order but the officers and members of UFE continued with the

Issue: Whether or not the strike is legal.

Held: No. A strike undertaken despite the issuance by the Secretary of Labor of an assumption or
certification order becomes a prohibited activity and thus, illegal, pursuant to Article 264 (a) of the Labor
Code. Moreover, the union officers and members who have participated in the said illegal activity, are, as a
result, deemed to have lost their employment status. Thus, we held that:

UFE completely misses the underlying principle embodied in Art. 263 (g) on the settlement of labor
disputes and this is, that assumption and certification orders are executory in character and are to be
strictly complied with by the parties even during the pendency of any petition questioning their validity.
This extraordinary authority given to the Secretary of Labor is aimed at arriving at a peaceful and speedy
solution to labor disputes, without jeopardizing national interests.

Regardless therefore of their motives, or the validity of their claims, the striking workers must cease and/or
desist from any and all acts that tend to, or undermine this authority of the Secretary of Labor, once an
assumption and/or certification order is issued. They cannot, for instance, ignore return-to-work orders,
citing unfair labor practices on the part of the company, to justify their actions. . . .

One other point that must be underscored is that the return-to-work order is issued pending the
determination of the legality or illegality of the strike. It is not correct to say that it may be enforced only if
the strike is legal and may be disregarded if the strike is illegal, for the purpose precisely is to maintain the
status quo while the determination is being made. Otherwise, the workers who contend that their strike is
legal can refuse to return to their work and cause a standstill on the company operations while retaining the
positions they refuse to discharge or allow the management to fill. Worse, they will also claim payment for
work not done, on the ground that they are still legally employed although actually engaged in the
activities inimical to their employer's interest.

This is like eating one's cake and having it too, and at the expense of the management. Such an unfair
situation surely was not contemplated by our labor laws and cannot be justified under the social justice
policy, which is a policy of fairness to both labor and management. Neither can this unseemly arrangement
be sustained under the due process clause as the order, if thus interpreted, would be plainly oppressive and
Chapter 9-9

G.R. No. 120482. January 27, 1997



Petitioner union was organized in May 1989 "by affiliating itself with Lakas Manggagawa sa
Pilipinas (hereinafter Lakas)." Lakas filed a notice of strike on 13 November 1989 because of
alleged acts of unfair labor practice committed by the private respondents. Despite conciliation
hearings held on 4 and 6 December 1989, the parties failed to reach an agreement. Later, another
act of unfair labor practice allegedly committed by the private respondents impelled Reformist,
with the authorization of Lakas, to go on strike on 13 December 1989 even as conciliation
proceedings continued.
On 21 December 1989, R.B. Liner, Inc. petitioned then Secretary Fanklin Drilon of the
Department of Labor and Employment (DOLE) to assume jurisdiction over the ongoing dispute or
certify it to the NLRC. Secretary Drilon determined that "[t]he ongoing work stoppage in the
company . . . . adversely affects an industry indispensable to the national interest;" thus on 28
December 1989, he certified the dispute to the NLRC for compulsory arbitration and issued a
return-to-work order.
The certified case (NLRC Certified case No. 0542, entitled In Re: Labor Dispute at RB Liner,
Inc.) was dismissed on 13 February 1990 after the union and the company reached all agreement
on 19 January 1990 providing, among other matters, for the holding of a certification election.

On 31 January 1990, a certification election was held where Lakas won as the collective
bargaining agent of the rank-and-file employees. On 13 February 1990, Lakas presented a
proposal for a collective bargaining agreement to Bernita and Rodelia Dejero, but they refused to
bargain. Meanwhile, as admitted by private respondents' witness Arcile Tanjuatco, Jr., eight R.B.
Liner buses were "converted" to Sultran Lines, one "became MCL," and another "became SST
The petitioners filed with NLRC a case charging the private respondents with unfair labor practice, i.e.,
illegal lock out. The private respondents countered with NLRC Case, which sought to declare as illegal the
union's 13 December 1989 strike, as well as other "work stoppages/boycotts" staged by the petitioners. The
two cases were consolidated and simultaneously tried.

In his decision, the Labor Arbiter ruled that the evidence indicated against an illegal lockout while finding
that Reformist staged an illegal strike. On appeal, the NLRC affirmed the Labor Arbiter’s finding.
Reformist and its members moved to reconsider the NLRC decision, which was however, denied. Hence,
this petition for certiorari.


Whether or not there was in this case a waiver of the issue on the illegality of the strike by the employer.


YES. The private respondents can no longer contest the legality of the strike held by the petitioners on
13 December 1989, as the private respondents themselves sought compulsory arbitration in order to
resolve that very issue, hence their letter to the Labor Secretary read, in part:

This is to request your good office to certify for compulsory arbitration or to assume
jurisdiction over the labor dispute (strike continuing) between R.B. Liner Inc . . . . and the Lakas
Manggagawa sa Pilipinas . . .

The current strike by Lakas which started on December 13, 1989 even before Certification
Election could be held could not be resolved by the NCR Conciliation-Mediation Division after
six meetings/conferences between the parties.
The dispute or strike was settled when the company and the union entered into an agreement on 19
January 1990 where the private respondents agreed to accept all employees who by then, had not yet
returned to work. By acceding to the peaceful settlement brokered by the NLRC, the private respondents
waived the issue of the illegality of the strike.

The very nature of compulsory arbitration makes the settlement binding upon the private respondents,
for compulsory arbitration has been defined both as "the process of settlement of labor disputes by a
government agency which has the authority to investigate and to make an award which is binding on all the
parties,"] and as a mode of arbitration where the parties are "compelled to accept the resolution of their
dispute through arbitration by a third party." Clearly then, the legality of the strike could no longer be
reviewed by the Labor Arbiter, much less by the NLRC, as this had already been resolved. It was the sole
issue submitted for compulsory arbitration by the private respondents, as is obvious from the portion of
their letter quoted above. The case certified by the Labor Secretary to the NLRC was dismissed after the
union and the company drew up the agreement mentioned earlier. This conclusively disposed of the strike

Chapter 9-10

MSF Tire and Rubber, Inc. vs. Court of Appeals

G.R.No. 128632, August 5, 1999
Mendoza, J.

FACTS: Respondent Union filed a notice of strike in the National Conciliation and Mediation Board
charging Philtread Tire and Rubber Corporation (Phildtread) with unfair labor practice. Thereafter, they
picketed and assembled outside the gate of Philtread’s plant. Philtread, on the other hand, filed a notice of
lockout. Subsequently, the Secretary of Labor assumed jurisdiction over the labor dispute and certified it
for compulsory arbitration. During the pendency of the labor dispute, Philtread entered into a
Memorandum of Agreement with Siam Tyre Public Company Limited (Siam Tyre) whereby its plant and
equipment would be sold to a new company, herein petitioner, 80% of which would be owned by Siam
Tyre and 20% by Philtread, while the land on which the plant was located would be sold to another
company, 60% of which would be owned by Philtread and 40% by Siam Tyre. Petitioner then asked
respondent Union to desist from picketing outside its plant. As the respondent Union refused petitioner’s
request, petitioner filed a complaint for injunction with damages before the Regional Trial Court of Makati.
Respondent Union moved to dismiss the complaint alleging lack of jurisdiction on the part of the trial
court. The trial court denied petitioner’s application for injunction and dismissed the complaint. However,
on petitioner’s motion, the trial court reconsidered its order and granted an injunction. Without filing a
motion for reconsideration, the respondent Union filed a petition for certiorari and prohibition before the
Court of Appeals. The Appellate Court ruled in favor of respondent Union. Hence, petitioner filed this
petition asserting that respondent Union’s petition should be dismissed for its failure to disclose in its
certification of non-forum shopping the pendency of the labor dispute involving both parties and for its
failure to file a motion for reconsideration. In addition, petitioner claimed that its status as an “innocent
bystander” entitled it to a writ of injunction.

ISSUE: Whether or not petitioner is an “innocent bystander”.

HELD: In affirming the decision of the Court of Appeals, the Supreme Court found that petitioner’s
own certification before the lower court suffered from the same omission for which it faulted the
respondent Union. It is therefore not in keeping with the requirements of fairness for petitioner to demand
strict application of the prohibition against forum-shopping, when it, too, was guilty of the same omission.

An “innocent bystander,” who seeks to enjoin a labor strike, must satisfy the court that aside from
the grounds specified in Rule 58 of the Rules of Court, it is entirely different from, without any connection
whatsoever to, either party to the dispute and, therefore, its interests are totally foreign to the context
thereof. Petitioner cannot be said not to have such connection to the dispute. As such, it cannot be
considered as an “innocent bystander.” The Court therefore ruled that the trial court’s order was a patent
nullity, the trial court having no jurisdiction to issue the writ of injunction. Hence, no motion for
reconsideration need be filed where the order is null and void.

Chapter 9-11



G.R. No. 99266 March 2, 1999


In July 1990, San Miguel Cooperation, alleging the need to streamline its operations due to financial loses,
shut down some of its plants and declared 55 positions as redundant listed as follows: seventeen (17)
employees in the Business Logistics Division ("BLD"), seventeen (17) in the Ayala Operations Center
(AOC), and eighteen (18) in the Magnolia-Manila Buying Station ("Magnolia-MBS"). 3 Consequently, the
private respondent union filed several grievance cases for the said retrenched employees, praying for the
redeployment of the said employees to the other divisions of the company.

The grievance proceedings were conducted pursuant to Sections 5 and 8, Article VIII of the parties' 1990
Collective Bargaining Agreement. During the grievance proceedings, however, most of the employees
were redeployed, while others accepted early retirement. As a result only 17 employees remained when the
parties proceeded to the third level (Step 3) of the grievance procedure. In a meeting on October 26, 1990,
petitioner informed private respondent union that if by October 30, 1990, the remaining 17 employees
could not yet be redeployed, their services would be terminated on November 2, 1990. The said meeting
adjourned when Mr. Daniel S. L. Borbon II, a representative of the union, declared that there was nothing
more to discuss in view of the deadlock. 5

On November 7, 1990, the private respondent filed with the National Conciliation and Mediation Board
(NCMB) of the Department of Labor and Employment (DOLE) a notice of strike on the following
grounds: a) bargaining deadlock; b) union busting; c) gross violation of the Collective Bargaining
Agreement (CBA), such as non-compliance with the grievance procedure; d) failure to provide private
respondent with a list of vacant positions pursuant to the parties side agreement that was appended to the
1990 CBA; and e) defiance of voluntary arbitration award. Petitioner on the other hand, moved to dismiss
the notice of strike but the NCMB failed to act on the motion.

On December 21, 1990, petitioner SMC filed a complaint with the respondent NLRC, praying for: (1) the
dismissal the notice of strike; (2) an order compelling the respondent union to submit to grievance and
arbitration the issue listed in the notice of strike; (3) the recovery of the expenses of litigation. On April 16,
1991, respondent NLRC came out with a minute resolution dismissing the complaint



Yes.The Petition is impressed with merit.The Rules and Regulations Implementing Book V the Labor
Code, provides that a strike or lockout may be declared in cases of bargaining deadlocks and unfair labor
practices. Violations of the collective bargaining agreements, except flagrant and/or malicious refusal to
comply with its economic provisions, shall not be considered unfair labor practice and shall not be
strikeable. No strike or lockout may be declared on grounds involving inter-union and intra-union disputes
or on issues brought to voluntary, or compulsory, arbitration. In the case under consideration, the grounds
relied upon by the private respondent union are non-strikeable. The issues which may lend substance to the
notice of strike filed by the private respondent union are: collective bargaining deadlock and petitioner's
alleged violation of the collective bargaining agreement. These grounds, however, appear more illusory
than real.

Collective Bargaining Deadlock is defined as "the situation between the labor and the management of the
company where there is failure in the collective bargaining negotiations resulting in a stalemate" This
situation, is non-existent in the present case since there is a Board assigned on the third level (Step 3) of
the grievance machinery to resolve the conflicting views of the parties. Instead of asking the Conciliation
Board composed of five representatives each from the company and the union, to decide the conflict,
petitioner declared a deadlock, and thereafter, filed a notice of strike. For failing to exhaust all the steps in
the grievance machinery and arbitration proceedings provided in the Collective Bargaining Agreement, the
notice of strike should have been dismissed by the NLRC and private respondent union ordered to proceed
with the grievance and arbitration proceedings

As regards the alleged violation of the CBA, we hold that such a violation is chargeable against the private
respondent union. In abandoning the grievance proceedings and stubbornly refusing to avail of the
remedies under the CBA. Private respondent violated the mandatory provisions of the collective bargaining
agreement. Abolition of departments or positions in the company is one of the recognized management
prerogatives. Noteworthy is the fact that the private respondent does not question the validity of the
business move of petitioner. In the absence of proof that the act of petitioner was ill-motivated, it is
presumed that petitioner San Miguel Corporation acted in good faith.

So also, in filing complaint with the NLRC, petitioner prayed that the private respondent union be
compelled to proceed with the grievance and arbitration proceedings. Petitioner having evinced its
willingness to negotiate the fate of the remaining employees affected, there is no ground to sustain the
notice of strike of the private respondent union.

Chapter 9-12

193 SCRA 223

FACTS: The 1986-1989 Collective Bargaining Agreement (CBA) between the Philippine Airlines (PAL)
and the Philippine Airlines Employees Association (PALEA) in addition to pay increases also provided for
the formation of a PAL/PALEA Payscale Panel. Accordingly, the PAL/PALEA Payscale Panel was formed
in due time and went to work. During the conferences of the panel however, there was no meeting of
minds between the parties.

As a result, PALEA accused PAL of bargaining in bad faith and consequently filed with the National
Conciliation and Mediation Board (NCMB) a notice of strike on account of: (1) bargaining deadlock; and
(2) unfair labor practice by bargaining in bad faith.

The PAL filed with the NCMB a motion to dismiss PALEA's notice of strike for being premature as
the issues raised were not strikeable since there still existed a PAL-PALEA CBA which would not yet
expire until September 30, 1989 or with nine (9) more months to run.

On January 6, 1989, the NCMB-NCR Executive Conciliator/Mediator, advised PALEA president,

George Pulido, that the issues raised in the notice of strike were "appropriate only for preventive
mediation," hence, not valid grounds for a lawful strike. However, when subsequently a representative of
NCMB supervised the conduct of PALEA'S strike vote, PAL's counsel was baffled for it was inconsistent
with the NCMB order treating the strike notice as preventive mediation. PAL's counsel sought clarification
from the NCMB. He assured PAL that the NCMB representatives could not certify the strike vote.

On January 12, 1989, PALEA submitted the strike vote results to the NCMB. The next day, January
13, 1989, PAL petitioned the Secretary of Labor Franklin Drilon to immediately assume jurisdiction over
the dispute in order to avert the impending strike. Inexplicably, the Secretary failed to act promptly on
PAL's petition for his assumption of jurisdiction.

Seven (7) days passed with no reaction from Secretary Drilon. Thus, on January 20, 1989, PALEA
declared a strike paralyzing PAL's entire operations the next day, resulting in serious inconvenience to
thousands of passengers who were stranded in 43 airports throughout the country, and the loss of millions
of pesos in unearned revenue for PAL. Late in the day, at 7:50 P.M., Secretary Drilon issued an order
assuming jurisdiction over the labor dispute which had already exploded into a full-blown strike, ordering
the strikers to lift their pickets and return to work, directing management to accept all returning employees,
and resolving the issues subject of the strike, by awarding the monetary benefits to the strikers, while
prohibiting the company from taking retaliatory action against them.

ISSUE: Whether or not the Secretary of Labor has authority to order the petitioner Philippine Airlines,
Inc. to reinstate officers and members of the union who participated in an illegal strike and to desist from
taking any disciplinary or retaliatory action against them?

HELD: The Labor Secretary exceeded his jurisdiction when he restrained PAL from taking disciplinary
action against its guilty employees, for, under Art. 263 of the Labor Code, all that the Secretary may enjoin
is the holding of the strike, but not the company's right to take action against union officers who
participated in the illegal strike and committed illegal acts. The prohibition which the Secretary issued to
PAL constitutes an unlawful deprivation of property and denial of due process for it prevents PAL from
seeking redress for the huge property losses that it suffered as a result of the union's illegal mass action.

Under Art. 263 of the Labor Code, the Labor Secretary's authority to resolve a labor dispute within 30
days from the date of assumption of jurisdiction, encompasses only the issues in the dispute, not the
legality or illegality of any strike that may have been resorted to in the meantime.




G.R. No. L-28607, May 31, 1971.


Respondent Shell Company of the Philippines (COMPANY) dissolved its security guard section stationed
at its Pandacan Installation, notwithstanding its (guard section) continuance and that such is assured by an
existing collective bargaining contract. The respondent company transferred 18 security guards to its other
department and consequently hired a private security agency to undertake the work of said security guards.
This resulted in a strike called by petitioner Shell Oil Workers’ Union (UNION), The President certified it
to respondent Court of Industrial Relations (CIR). CIR declared the strike illegal on the ground that such
dissolution was a valid exercise of a management prerogative. Thus this appeal is taken.

Petitioner argued that the 18 security guards affected are part of the bargaining unit and covered by the
existing collective bargaining contract, as such, their transfers and eventual dismissals are illegal being
done in violation of the existing contract. The Company maintained that in contracting out the security
service and redeploying the 18 security guards affected, it was merely performing its legitimate prerogative
to adopt the most efficient and economical method of operation, that said action was motivated by business
consideration in line with past established practice and made after notice to and discussion with the Union,
that the 18 guards concerned were dismissed for wilfully refusing to obey the transfer order, and that the
strike staged by the Union is illegal.


Whether the existing collective bargaining contract on maintaining security guard section, among others,
constitute a bar to the decision of the management to contract out security guards.


YES. The strike was legal because there was a violation of the collective bargaining agreement by
Company. It was part of the CBA that the Security Guard Section will remain. Yet, the Company did not
comply with the stipulation in CBA. It was thus an assurance of security of tenure, at least, during the
lifetime of the agreement. For what is involved is the integrity of the agreement reached, the terms of
which should be binding on both parties

The stand of Shell Company as to the scope of management prerogative is not devoid of plausibility,
management prerogative of the Company would have been valid if it were not bound by what was
stipulated in CBA. The freedom to manage the business remains with management. It cannot be denied the
faculty of promoting efficiency and attaining economy by a study of what units are essential for its
operation. To it belongs the ultimate determination of whether services should be performed by its
personnel or contracted to outside agencies. However, while management has the final say on such matter,
the labor union is not to be completely left out.

An unfair labor practice is committed by a labor union or its agent by its refusal ‘to bargain collectively
with the employer’. Collective bargaining does not end with the execution of an agreement, being a
continuous process, the duty to bargain necessarily imposing on the parties the obligation to live up to the
terms of such a collective bargaining agreement if entered into, it is undeniable that non-compliance
therewith constitutes an unfair labor practice.

The right to self-organization guarded by the Industrial Peace Act explicitly includes the right “to engage
in concerted activities for the purpose of collective bargaining and to the mutual aid or protection.” The
employee, tenant or laborer is inhibited from striking or walking out of his employment only when so
enjoined by the CIR and after a dispute has been submitted thereto and pending award or decision by the
court of such dispute.

In the present case, the employees or laborers may strike before being ordered not to do so and before an
industrial dispute is submitted to the CIR, subject to the power of the latter, after hearing when public
interest so requires or when the dispute cannot, in its opinion, be promptly decided or settled, to order them
to return to work, with the consequence that if the strikers fail to return to work, when so ordered, the court
may authorize the employer to accept other employees or laborers.” Thus a strike may not be staged only
when, during the pendency of an industrial dispute, the CIR has issued the proper injunction against the
laborers (section 19, Commonwealth Act No. 103, as amended).

WHEREFORE, the decision of respondent Court of Industrial Relations of August 5, 1967 is reversed.





It is not even required that there be in fact an unfair labor practice committed by the employer. It suffices,
if such a belief in good faith is entertained by labor, as the inducing factor for staging a strike. So it was
declared: “As a consequence, we hold that the strike in question had been called to offset what petitioners
were wanted in believing in good faith to be unfair labor practices on the part of Management, that
petitioners were not bound, therefore, to wait for the expiration of thirty (30) days from notice of strike
before staging the same, that said strike was not, accordingly, illegal and that the strikers had not thereby
lost their status as employees of respondents herein.”

HENRY BACUS, et. al., ,
petitioners, vs.
respondents,G.R. No. L-56856; October 23, 1984; Cuevas, J.
Findlay Millar Timber Company is engaged in logging and manufacture of plywood, veneer and other
lumber products.The company employs approximately 2,000 employees more or less, among whom are the
herein petitioners. On February 19,1979, about 1,400 employees, more or less, of the Company staged a
mass walk-out, to protest among others the non-payment of their salaries and wages, non-payment of
unused vacation and sick leaves, and non-payment of the 13th month pay. Thereafter,the Company filed
with the MOLE a clearance

to terminate the services of 19 employees, including the herein petitioners becauseof illegal strike and that
they abandoned their jobs for the past 10 days. MOLE issued an order for the management to pay
thepayroll of the employees and the latter are ordered to return to work. However, both parties failed to
carry out the said order hence conference was conducted. Subsequently, a hearing was set but this was
rescheduled and/or delayed several times. At anyrate, after hearing, Deputy Minister Inciong, acting on the
recommendation of Arbiter Macaraya rendered a decision that thestrike was illegal and out of 41
workers sought to be terminated in the Company's Clearance Application, only ten (10)
[petitioners] appeared to be the instigators of the strike pointing out that a strike thus the clearance to
terminate Bacus,,(petitioners) was granted. The MR of the said employees was denied hence this
1. Whether or not strike was illegal.2 . W h e t h e r o r n o t t h e o r d e r o f M O L E
was rendered with grave abuse of discret ion or without or in excess
o f i t s jurisdiction.
Affixing the stamp of illegality to the strike on the ground that it was marred by acts of violence committed
by thew o r k e r s , i s a n u n r e a l i s t i c a n d o u t m o d e d v i e w o f t h e r i g h t t o s t r i k e . F r o m a l l
i n d i c a t i o n s , u n d e r t h e f a c t s a n d circumstances of the instant case, staging such a concerted action
by not reporting for work, as in the case at bar, maybe viewed as one inspired by good faith. Not every
form of violence suffices to affix the seal of illegality on a strike or to cause the loss of employment by the
guilty party. To avoid rendering illusory the recognition of the right to strike,responsibility in such a case
should be individual and not collective. Strike staged by the workers, inspired by goodfaith does not
automatically make the same illegal. In the instant case,it is not disputed that the Company did not paythe
salaries of the workers for one and a half months, more or less. Such act of the Company broke the
patience of theworkers. On the other hand, the act of the workers in demanding a valid grievance for the

payment of their salaries isinspired by their honest belief that the Company was committing acts inimical
to their interests relative to wages which,basically, is a violation of the CBA existing between the parties.
A mere finding of the illegality of a strike should not be automatically followed by wholesale dismissal of
thestrikers from their employment. Even if declared illegal, need not have been attended with such a
drastic consequenceas termination of employment relationship because of the security of tenure provision
under the Constitution.