Definition, Nature, Purpose of Picket Line

Insular Life Assurance Co., Ltd. Employees Association v. Insular Life Assurance Co.,
Ltd., supra

The Insular Life Assurance Co., Ltd., Employees Association-NATU, FGU Insurance Group Workers
& Employees Association-NATU, and Insular Life Building Employees Association-NATU
(hereinafter referred to as the Unions), while still members of the Federation of Free Workers (FFW),
entered into separate collective bargaining agreements with the Insular Life Assurance Co., Ltd. and
the FGU Insurance Group (hereinafter referred to as the Companies).

Two of the lawyers of the Unions then were Felipe Enaje and Ramon Garcia; the latter was formerly
the secretary-treasurer of the FFW and acting president of the Insular Life/FGU unions and the
Insular Life Building Employees Association. Garcia, as such acting president, in a circular issued in
his name and signed by him, tried to dissuade the members of the Unions from disaffiliating with the
FFW and joining the National Association of Trade Unions (NATU), to no avail.

Enaje and Garcia soon left the FFW and secured employment with the Anti-Dummy Board of the
Department of Justice. Thereafter, the Companies hired Garcia in the latter part of 1956 as assistant
corporate secretary and legal assistant in their Legal Department, and he was soon receiving P900 a
month, or P600 more than he was receiving from the FFW. Enaje was hired on or about February
19, 1957 as personnel manager of the Companies, and was likewise made chairman of the
negotiating panel for the Companies in the collective bargaining with the Unions.

In a letter dated September 16, 1957, the Unions jointly submitted proposals to the Companies for a
modified renewal of their respective collective bargaining contracts which were then due to expire on
September 30, 1957. The parties mutually agreed and to make whatever benefits could be agreed
upon retroactively effective October 1, 1957.

Thereafter, in the months of September and October 1957 negotiations were conducted on the
Union's proposals, but these were snagged by a deadlock on the issue of union shop, as a
result of which the Unions filed on January 27, 1958 a notice of strike for "deadlock on
collective bargaining." Several conciliation conferences were held under the auspices of the
Department of Labor wherein the conciliators urged the Companies to make reply to the Unions'
proposals en toto so that the said Unions might consider the feasibility of dropping their demand for
union security in exchange for other benefits. However, the Companies did not make any
counter-proposals but, instead, insisted that the Unions first drop their demand for union
security, promising money benefits if this was done. Thereupon, and prior to April 15, 1958, the
petitioner Insular Life Building Employees Association-NATU dropped this particular demand, and
requested the Companies to answer its demands, point by point, en toto. But the respondent
Insular Life Assurance Co. still refused to make any counter-proposals. In a letter addressed to
the two other Unions by the joint management of the Companies, the former were also asked to drop
their union security demand, otherwise the Companies "would no longer consider themselves bound
by the commitment to make money benefits retroactive to October 1, 1957." By a letter dated April
17, 1958, the remaining two petitioner unions likewise dropped their demand for union shop. April
25, 1958 then was set by the parties to meet and discuss the remaining demands.

From April 25 to May 6, 1958, the parties negotiated on the labor demands but with no
satisfactory result due to a stalemate on the matter of salary increases. On May 13, 1958 the
Unions demanded from the Companies final counter-proposals on their economic demands,
particularly on salary increases. Instead of giving counter-proposals, the Companies on May
15, 1958 presented facts and figures and requested the Unions to submit a workable formula
which would justify their own proposals, taking into account the financial position of the
former. Forthwith the Unions voted to declare a strike in protest against what they considered
the Companies' unfair labor practices.

Meanwhile, eighty-seven (87) unionists were reclassified as supervisors without increase in salary
nor in responsibility while negotiations were going on in the Department of Labor after the notice to
strike was served on the Companies. These employees resigned from the Unions.

On May 20, 1958 the Unions went on strike and picketed the offices of the Insular Life Building at
Plaza Moraga.

On May 21, 1958 the Companies through their acting manager and president, the respondent Jose
M. Olbes (hereinafter referred to as the respondent Olbes), sent to each of the strikers a letter
(exhibit A) quoted verbatim as follows:

We recognize it is your privilege both to strike and to conduct picketing.

However, if any of you would like to come back to work voluntarily, you may:

1. Advise the nearest police officer or security guard of your intention to do so.

2. Take your meals within the office.

3. Make a choice whether to go home at the end of the day or to sleep nights at the
office where comfortable cots have been prepared.

4. Enjoy free coffee and occasional movies.

5. Be paid overtime for work performed in excess of eight hours.

6. Be sure arrangements will be made for your families.

The decision to make is yours — whether you still believe in the motives of the strike
or in the fairness of the Management.

The Unions, however, continued on strike, with the exception of a few unionists who were convinced
to desist by the aforesaid letter of May 21, 1958.

From the date the strike was called on May 21, 1958, until it was called off on May 31, 1958, some
management men tried to break thru the Unions' picket lines. Thus, on May 21, 1958 Garcia,
assistant corporate secretary, and Vicente Abella, chief of the personnel records section,
respectively of the Companies, tried to penetrate the picket lines in front of the Insular Life Building.
Garcia, upon approaching the picket line, tossed aside the placard of a picketer, one Paulino Bugay;
a fight ensued between them, in which both suffered injuries. The Companies organized three bus-
loads of employees, including a photographer, who with the said respondent Olbes, succeeded in
penetrating the picket lines in front of the Insular Life Building, thus causing injuries to the picketers
and also to the strike-breakers due to the resistance offered by some picketers.

Alleging that some non-strikers were injured and with the use of photographs as evidence, the
Companies then filed criminal charges against the strikers with the City Fiscal's Office of Manila.
During the pendency of the said cases in the fiscal's office, the Companies likewise filed a petition
for injunction with damages with the Court of First Instance of Manila which, on the basis of the
pendency of the various criminal cases against striking members of the Unions, issued on May 31,
1958 an order restraining the strikers, until further orders of the said court, from stopping, impeding,
obstructing, etc. the free and peaceful use of the Companies' gates, entrance and driveway and the
free movement of persons and vehicles to and from, out and in, of the Companies' building.

On the same date, the Companies, again through the respondent Olbes, sent individually to the
strikers a letter (exhibit B), quoted hereunder in its entirety:

The first day of the strike was last 21 May 1958.

Our position remains unchanged and the strike has made us even more convinced of
our decision.

We do not know how long you intend to stay out, but we cannot hold your positions
open for long. We have continued to operate and will continue to do so with or
without you.

If you are still interested in continuing in the employ of the Group Companies, and if
there are no criminal charges pending against you, we are giving you until 2 June
1958 to report for work at the home office. If by this date you have not yet reported,
we may be forced to obtain your replacement.

Before, the decisions was yours to make.

So it is now.

Incidentally, all of the more than 120 criminal charges filed against the members of the Unions,
except three (3), were dismissed by the fiscal's office and by the courts. These three cases involved
"slight physical injuries" against one striker and "light coercion" against two others.

At any rate, because of the issuance of the writ of preliminary injunction against them as well as the
ultimatum of the Companies giving them until June 2, 1958 to return to their jobs or else be replaced,
the striking employees decided to call off their strike and to report back to work on June 2, 1958.

However, before readmitting the strikers, the Companies required them not only to secure
clearances from the City Fiscal's Office of Manila but also to be screened by a management
committee among the members of which were Enage and Garcia. The screening committee initially
rejected 83 strikers with pending criminal charges. However, all non-strikers with pending criminal
charges which arose from the breakthrough incident were readmitted immediately by the Companies
without being required to secure clearances from the fiscal's office. Subsequently, when practically
all the strikers had secured clearances from the fiscal's office, the Companies readmitted only some
but adamantly refused readmission to 34 officials and members of the Unions who were most active
in the strike, on the ground that they committed "acts inimical to the interest of the respondents,"
without however stating the specific acts allegedly committed. Among those who were refused
readmission are Emiliano Tabasondra, vice president of the Insular Life Building Employees'
Association-NATU; Florencio Ibarra, president of the FGU Insurance Group Workers & Employees
Association-NATU; and Isagani Du Timbol, acting president of the Insular Life Assurance Co., Ltd.
Employees Association-NATU. Some 24 of the above number were ultimately notified months later
that they were being dismissed retroactively as of June 2, 1958 and given separation pay checks
computed under Rep. Act 1787, while others (ten in number) up to now have not been readmitted
although there have been no formal dismissal notices given to them.
On July 29, 1958 the CIR prosecutor filed a complaint for unfair labor practice against the
Companies under Republic Act 875. The complaint specifically charged the Companies with (1)
interfering with the members of the Unions in the exercise of their right to concerted action, by
sending out individual letters to them urging them to abandon their strike and return to work, with a
promise of comfortable cots, free coffee and movies, and paid overtime, and, subsequently, by
warning them that if they did not return to work on or before June 2, 1958, they might be replaced;
and (2) discriminating against the members of the Unions as regards readmission to work after the
strike on the basis of their union membership and degree of participation in the strike.

On August 4, 1958 the Companies filed their answer denying all the material allegations of the
complaint, stating special defenses therein, and asking for the dismissal of the complaint.

After trial on the merits, the Court of Industrial Relations, through Presiding Judge Arsenio Martinez,
rendered on August 17, 1965 a decision dismissing the Unions' complaint for lack of merit. On
August 31, 1965 the Unions seasonably filed their motion for reconsideration of the said decision,
and their supporting memorandum on September 10, 1965. This was denied by the Court of
Industrial Relations en banc in a resolution promulgated on October 20, 1965.

Hence, this petition for review, the Unions contending that the lower court erred:

1. In not finding the Companies guilty of unfair labor practice in sending out
individually to the strikers the letters marked Exhibits A and B;

2. In not finding the Companies guilty of unfair labor practice for discriminating
against the striking members of the Unions in the matter of readmission of
employees after the strike;

3. In not finding the Companies guilty of unfair labor practice for dismissing officials
and members of the Unions without giving them the benefit of investigation and the
opportunity to present their side in regard to activities undertaken by them in the
legitimate exercise of their right to strike; and

4. In not ordering the reinstatement of officials and members of the Unions, with full
back wages, from June 2, 1958 to the date of their actual reinstatement to their usual
employment.

I. The respondents contend that the sending of the letters, exhibits A and B, constituted a legitimate
exercise of their freedom of speech. We do not agree. The said letters were directed to the striking
employees individually — by registered special delivery mail at that — without being coursed
through the Unions which were representing the employees in the collective bargaining.

The act of an employer in notifying absent employees individually during a strike

following unproductive efforts at collective bargaining that the plant would be
operated the next day and that their jobs were open for them should they want to
come in has been held to be an unfair labor practice, as an active interference with
the right of collective bargaining through dealing with the employees individually
instead of through their collective bargaining representatives. (31 Am. Jur.
563, citing NLRB v. Montgomery Ward & Co. [CA 9th] 133 F2d 676, 146 ALR 1045)

Indeed, it is an unfair labor practice for an employer operating under a collective bargaining
agreement to negotiate or to attempt to negotiate with his employees individually in connection with
changes in the agreement. And the basis of the prohibition regarding individual bargaining with the
strikers is that although the union is on strike, the employer is still under obligation to bargain with
the union as the employees' bargaining representative (Melo Photo Supply Corporation vs. National
Labor Relations Board, 321 U.S. 332).

Indeed, some such similar actions are illegal as constituting unwarranted acts of interference. Thus,
the act of a company president in writing letters to the strikers, urging their return to work on terms
inconsistent with their union membership, was adjudged as constituting interference with the
exercise of his employees' right to collective bargaining (Lighter Publishing, CCA 7th, 133 F2d 621).
It is likewise an act of interference for the employer to send a letter to all employees notifying them to
return to work at a time specified therein, otherwise new employees would be engaged to perform
their jobs. Individual solicitation of the employees or visiting their homes, with the employer or his
representative urging the employees to cease union activity or cease striking, constitutes unfair labor
practice. All the above-detailed activities are unfair labor practices because they tend to undermine
the concerted activity of the employees, an activity to which they are entitled free from the
employer's molestation.1

Moreover, since exhibit A is a letter containing promises of benefits to the employees in order to
entice them to return to work, it is not protected by the free speech provisions of the Constitution
(NLRB v. Clearfield Cheese Co., Inc., 213 F2d 70). The same is true with exhibit B since it contained
threats to obtain replacements for the striking employees in the event they did not report for work on
June 2, 1958. The free speech protection under the Constitution is inapplicable where the
expression of opinion by the employer or his agent contains a promise of benefit, or threats, or
reprisal (31 Am. Jur. 544; NLRB vs. Clearfield Cheese Co., Inc., 213 F2d 70; NLRB vs. Goigy Co.,
211 F2d 533, 35 ALR 2d 422).

Indeed, when the respondents offered reinstatement and attempted to "bribe" the strikers with
"comfortable cots," "free coffee and occasional movies," "overtime" pay for "work performed in
excess of eight hours," and "arrangements" for their families, so they would abandon the strike and
return to work, they were guilty of strike-breaking and/or union-busting and, consequently, of unfair
labor practice. It is equivalent to an attempt to break a strike for an employer to offer reinstatement to
striking employees individually, when they are represented by a union, since the employees thus
offered reinstatement are unable to determine what the consequences of returning to work would be.

Likewise violative of the right to organize, form and join labor organizations are the following acts:
the offer of a Christmas bonus to all "loyal" employees of a company shortly after the making of a
request by the union to bargain; wage increases given for the purpose of mollifying employees after
the employer has refused to bargain with the union, or for the purpose of inducing striking
employees to return to work; the employer's promises of benefits in return for the strikers'
abandonment of their strike in support of their union; and the employer's statement, made about 6
weeks after the strike started, to a group of strikers in a restaurant to the effect that if the strikers
returned to work, they would receive new benefits in the form of hospitalization, accident insurance,
profit-sharing, and a new building to work in.2

Citing paragraph 5 of the complaint filed by the acting prosecutor of the lower court which states that
"the officers and members of the complainant unions decided to call off the strike and return to work
on June 2, 1958 by reason of the injunction issued by the Manila Court of First Instance," the
respondents contend that this was the main cause why the strikers returned to work and not the
letters, exhibits A and B. This assertion is without merit. The circumstance that the strikers later
decided to return to work ostensibly on account of the injunctive writ issued by the Court of First
Instance of Manila cannot alter the intrinsic quality of the letters, which were calculated, or which
tended, to interfere with the employees' right to engage in lawful concerted activity in the form of a
strike. Interference constituting unfair labor practice will not cease to be such simply because it was
susceptible of being thwarted or resisted, or that it did not proximately cause the result intended. For
success of purpose is not, and should not, be the criterion in determining whether or not a prohibited
act constitutes unfair labor practice.

The test of whether an employer has interfered with and coerced employees within
the meaning of subsection (a) (1) is whether the employer has engaged in conduct
which it may reasonably be said tends to interfere with the free exercise of
employees' rights under section 3 of the Act, and it is not necessary that there be
direct evidence that any employee was in fact intimidated or coerced by statements
of threats of the employer if there is a reasonable inference that anti-union conduct of
the employer does have an adverse effect on self-organization and collective
bargaining. (Francisco, Labor Laws 1956, Vol. II, p. 323, citing NLRB v. Ford, C.A.,
1948, 170 F2d 735).

Besides, the letters, exhibits A and B, should not be considered by themselves alone but should be
read in the light of the preceding and subsequent circumstances surrounding them. The letters
should be interpreted according to the "totality of conduct doctrine,"

... whereby the culpability of an employer's remarks were to be evaluated not only on
the basis of their implicit implications, but were to be appraised against the
background of and in conjunction with collateral circumstances. Under this "doctrine"
expressions of opinion by an employer which, though innocent in themselves,
frequently were held to be culpable because of the circumstances under which they
were uttered, the history of the particular employer's labor relations or anti-union bias
or because of their connection with an established collateral plan of coercion or
interference. (Rothenberg on Relations, p. 374, and cases cited therein.)

It must be recalled that previous to the petitioners' submission of proposals for an amended renewal
of their respective collective bargaining agreements to the respondents, the latter hired Felipe Enage
and Ramon Garcia, former legal counsels of the petitioners, as personnel manager and assistant
corporate secretary, respectively, with attractive compensations. After the notice to strike was served
on the Companies and negotiations were in progress in the Department of Labor, the respondents
reclassified 87 employees as supervisors without increase in salary or in responsibility, in effect
compelling these employees to resign from their unions. And during the negotiations in the
Department of Labor, despite the fact that the petitioners granted the respondents' demand that the
former drop their demand for union shop and in spite of urgings by the conciliators of the Department
of Labor, the respondents adamantly refused to answer the Unions' demands en toto. Incidentally,
Enage was the chairman of the negotiating panel for the Companies in the collective bargaining
between the former and the Unions. After the petitioners went to strike, the strikers were individually
sent copies of exhibit A, enticing them to abandon their strike by inducing them to return to work
upon promise of special privileges. Two days later, the respondents, thru their president and
manager, respondent Jose M. Olbes, brought three truckloads of non-strikers and others, escorted
by armed men, who, despite the presence of eight entrances to the three buildings occupied by the
Companies, entered thru only one gate less than two meters wide and in the process, crashed thru
the picket line posted in front of the premises of the Insular Life Building. This resulted in injuries on
the part of the picketers and the strike-breakers. Then the respondents brought against the
lâwphî1.ñèt

picketers criminal charges, only three of which were not dismissed, and these three only for slight
misdemeanors. As a result of these criminal actions, the respondents were able to obtain an
injunction from the court of first instance restraining the strikers from stopping, impeding, obstructing,
etc. the free and peaceful use of the Companies' gates, entrance and driveway and the free
movement of persons and vehicles to and from, out and in, of the Companies' buildings. On the
same day that the injunction was issued, the letter, Exhibit B, was sent — again individually and by
registered special delivery mail — to the strikers, threatening them with dismissal if they did not
report for work on or before June 2, 1958. But when most of the petitioners reported for work, the
respondents thru a screening committee — of which Ramon Garcia was a member — refused to
admit 63 members of the Unions on the ground of "pending criminal charges." However, when
almost all were cleared of criminal charges by the fiscal's office, the respondents adamantly refused
admission to 34 officials and union members. It is not, however, disputed that all-non-strikers with
pending criminal charges which arose from the breakthrough incident of May 23, 1958 were
readmitted immediately by the respondents. Among the non-strikers with pending criminal charges
who were readmitted were Generoso Abella, Enrique Guidote, Emilio Carreon, Antonio Castillo,
Federico Barretto, Manuel Chuidian and Nestor Cipriano. And despite the fact that the fiscal's office
found no probable cause against the petitioning strikers, the Companies adamantly refused
admission to them on the pretext that they committed "acts inimical to the interest of the
respondents," without stating specifically the inimical acts allegedly committed. They were soon to
admit, however, that these alleged inimical acts were the same criminal charges which were
dismissed by the fiscal and by the courts..

Verily, the above actuations of the respondents before and after the issuance of the letters, exhibit A
and B, yield the clear inference that the said letters formed of the respondents scheme to preclude if
not destroy unionism within them.

To justify the respondents' threat to dismiss the strikers and secure replacements for them in order
to protect and continue their business, the CIR held the petitioners' strike to be an economic strike
on the basis of exhibit 4 (Notice of Strike) which states that there was a "deadlock in collective
bargaining" and on the strength of the supposed testimonies of some union men who did not actually
know the very reason for the strike. It should be noted that exhibit 4, which was filed on January 27,
1958, states, inter alia:

TO: BUREAU OF LABOR RELATIONS

DEPARTMENT OF LABOR
MANILA

Thirty (30) days from receipt of this notice by the Office, this [sic] unions intends to go
on strike against

THE INSULAR LIFE ASSURANCE CO., LTD.

Plaza Moraga, Manila

THE FGU INSURANCE GROUP

Plaza Moraga, Manila

INSULAR LIFE BUILDING ADMINISTRATION

Plaza Moraga, Manila .

for the following reason: DEADLOCK IN COLLECTIVE BARGAINING...

However, the employees did not stage the strike after the thirty-day period, reckoned from January
27, 1958. This simply proves that the reason for the strike was not the deadlock on collective
bargaining nor any lack of economic concessions. By letter dated April 15, 1958, the respondents
categorically stated what they thought was the cause of the "Notice of Strike," which so far as
material, reads:

3. Because you did not see fit to agree with our position on the union shop, you filed
a notice of strike with the Bureau of Labor Relations on 27 January 1958, citing
 `deadlock in collective bargaining' which could have been for no other issue than the
union shop." (exhibit 8, letter dated April 15, 1958.)

The strike took place nearly four months from the date the said notice of strike was filed. And the
actual and main reason for the strike was, "When it became crystal clear the management double
crossed or will not negotiate in good faith, it is tantamount to refusal collectively and considering the
unfair labor practice in the meantime being committed by the management such as the sudden
resignation of some unionists and [who] became supervisors without increase in salary or change in
responsibility, such as the coercion of employees, decided to declare the strike." (tsn., Oct. 14, 1958,
p. 14.) The truth of this assertion is amply proved by the following circumstances: (1) it took the
respondents six (6) months to consider the petitioners' proposals, their only excuse being that they
could not go on with the negotiations if the petitioners did not drop the demand for union shop (exh.
7, respondents' letter dated April 7, 1958); (2) when the petitioners dropped the demand for union
shop, the respondents did not have a counter-offer to the petitioners' demands. Sec. 14 of Rep. Act
875 required the respondents to make a reply to the petitioners' demands within ten days from
receipt thereof, but instead they asked the petitioners to give a "well reasoned, workable formula
which takes into account the financial position of the group companies." (tsn., Sept. 8, 1958, p. 62;
tsn., Feb. 26, 1969, p. 49.)

II. Exhibit H imposed three conditions for readmission of the strikers, namely: (1) the employee must
be interested in continuing his work with the group companies; (2) there must be no criminal charges
against him; and (3) he must report for work on June 2, 1958, otherwise he would be replaced. Since
the evidence shows that all the employees reported back to work at the respondents' head office on
June 2, 1953, they must be considered as having complied with the first and third conditions.

Our point of inquiry should therefore be directed at whether they also complied with the second
condition. It is not denied that when the strikers reported for work on June 2, 1958, 63 members of
the Unions were refused readmission because they had pending criminal charges. However, despite
the fact that they were able to secure their respective clearances 34 officials and union members
were still refused readmission on the alleged ground that they committed acts inimical to the
Companies. It is beyond dispute, however, that non-strikers who also had criminal charges pending
against them in the fiscal's office, arising from the same incidents whence the criminal charges
against the strikers evolved, were readily readmitted and were not required to secure clearances.
This is a clear act of discrimination practiced by the Companies in the process of rehiring and is
therefore a violation of sec. 4(a) (4) of the Industrial Peace Act.

The respondents did not merely discriminate against all the strikers in general. They separated the
active from the less active unionists on the basis of their militancy, or lack of it, on the picket lines.
Unionists belonging to the first category were refused readmission even after they were able to
secure clearances from the competent authorities with respect to the criminal charges filed against
them. It is significant to note in this connection that except for one union official who deserted his
union on the second day of the strike and who later participated in crashing through the picket lines,
not a single union officer was taken back to work. Discrimination undoubtedly exists where the
record shows that the union activity of the rehired strikers has been less prominent than that of the
strikers who were denied reinstatement.

So is there an unfair labor practice where the employer, although authorized by the
Court of Industrial Relations to dismiss the employees who participated in an illegal
strike, dismissed only the leaders of the strikers, such dismissal being evidence of
discrimination against those dismissed and constituting a waiver of the employer's
right to dismiss the striking employees and a condonation of the fault committed by
 them." (Carlos and Fernando, Labor and Social Legislation, p. 62, citing Phil. Air
Lines, Inc. v. Phil. Air Lines Emloyees Association, L-8197, Oct. 31, 1958.)

It is noteworthy that — perhaps in an anticipatory effort to exculpate themselves from charges of

discrimination in the readmission of strikers returning to work — the respondents delegated the
power to readmit to a committee. But the respondent Olbes had chosen Vicente Abella, chief of the
personnel records section, and Ramon Garcia, assistant corporate secretary, to screen the unionists
reporting back to work. It is not difficult to imagine that these two employees — having been involved
in unpleasant incidents with the picketers during the strike — were hostile to the strikers. Needless
to say, the mere act of placing in the hands of employees hostile to the strikers the power of
reinstatement, is a form of discrimination in rehiring.

Delayed reinstatement is a form of discrimination in rehiring, as is having the

machinery of reinstatement in the hands of employees hostile to the strikers, and
reinstating a union official who formerly worked in a unionized plant, to a job in
another mill, which was imperfectly organized. (Morabe, The Law on Strikes, p. 473,
citing Sunshine Mining Co., 7 NLRB 1252; Cleveland Worsted Mills, 43 NLRB 545;
emphasis supplied.)

Equally significant is the fact that while the management and the members of the screening
committee admitted the discrimination committed against the strikers, they tossed back and around
to each other the responsibility for the discrimination. Thus, Garcia admitted that in exercising for the
management the authority to screen the returning employees, the committee admitted the non-
strikers but refused readmission to the strikers (tsn., Feb. 6, 1962, pp. 15-19, 23-29). Vicente Abella,
chairman of the management's screening committee, while admitting the discrimination, placed the
blame therefor squarely on the management (tsn., Sept. 20, 1960, pp. 7-8, 14-18). But the
management, speaking through the respondent Olbes, head of the Companies, disclaimed
responsibility for the discrimination. He testified that "The decision whether to accept or not an
employee was left in the hands of that committee that had been empowered to look into all cases of
the strikers." (tsn., Sept. 6, 1962, p. 19.)

Of course, the respondents — through Ramon Garcia — tried to explain the basis for such
discrimination by testifying that strikers whose participation in any alleged misconduct during the
picketing was not serious in nature were readmissible, while those whose participation was serious
were not. (tsn., Aug. 4, 1961, pp. 48-49, 56). But even this distinction between acts of slight
misconduct and acts of serious misconduct which the respondents contend was the basis for either
reinstatement or discharge, is completely shattered upon a cursory examination of the evidence on
record. For with the exception of Pascual Esquillo whose dismissal sent to the other strikers cited the
alleged commission by them of simple "acts of misconduct."

III. Anent the third assignment of error, the record shows that not a single dismissed striker was
given the opportunity to defend himself against the supposed charges against him. As earlier
mentioned, when the striking employees reported back for work on June 2, 1958, the respondents
refused to readmit them unless they first secured the necessary clearances; but when all, except
three, were able to secure and subsequently present the required clearances, the respondents still
refused to take them back. Instead, several of them later received letters from the respondents in the
following stereotyped tenor:

This will confirm the termination of your employment with the Insular Life-FGU
Insurance Group as of 2 June 1958.
 The termination of your employment was due to the fact that you committed acts of
misconduct while picketing during the last strike. Because this may not constitute
sufficient cause under the law to terminate your employment without pay, we are
giving you the amount of P1,930.32 corresponding to one-half month pay for every
year of your service in the Group Company.

Kindly acknowledge receipt of the check we are sending herewith.

Very truly yours,

(Sgd.) JOSE M.
OLBES
President, Insurance
Life
Acting President, FGU.

The respondents, however, admitted that the alleged "acts of misconduct" attributed to the dismissed
strikers were the same acts with which the said strikers were charged before the fiscal's office and
the courts. But all these charges except three were dropped or dismissed.

Indeed, the individual cases of dismissed officers and members of the striking unions do not indicate
sufficient basis for dismissal.

Emiliano Tabasondra, vice-president of the petitioner FGU Insurance Group Workers & Employees
Association-NATU, was refused reinstatement allegedly because he did not report for duty on June
2, 1958 and, hence, had abandoned his office. But the overwhelming evidence adduced at the trial
and which the respondents failed to rebut, negates the respondents' charge that he had abandoned
his job. In his testimony, corroborated by many others, Tabasondra particularly identified the
management men to whom he and his group presented themselves on June 2, 1958. He mentioned
the respondent Olbes' secretary, De Asis, as the one who received them and later directed them —
when Olbes refused them an audience — to Felipe Enage, the Companies' personnel manager. He
likewise categorically stated that he and his group went to see Enage as directed by Olbes'
secretary. If Tabasondra were not telling the truth, it would have been an easy matter for the
respondents to produce De Asis and Enage — who testified anyway as witnesses for the
respondents on several occasions — to rebut his testimony. The respondents did nothing of the
kind. Moreover, Tabasondra called on June 21, 1958 the respondents' attention to his non-
admission and asked them to inform him of the reasons therefor, but instead of doing so, the
respondents dismissed him by their letter dated July 10, 1958. Elementary fairness required that
before being dismissed for cause, Tabasondra be given "his day in court."

At any rate, it has been held that mere failure to report for work after notice to return, does not
constitute abandonment nor bar reinstatement. In one case, the U.S. Supreme Court held that the
taking back of six of eleven men constituted discrimination although the five strikers who were not
reinstated, all of whom were prominent in the union and in the strike, reported for work at various
times during the next three days, but were told that there were no openings. Said the Court:

... The Board found, and we cannot say that its finding is unsupported, that, in taking
back six union men, the respondent's officials discriminated against the latter on
account of their union activities and that the excuse given that they did not apply until
after the quota was full was an afterthought and not the true reason for the
discrimination against them. (NLRB v. Mackay Radio & Telegraph Co., 304 U.S. 333,
 58 Sup. Ct. 904, 82 L. Ed. 1381) (Mathews, Labor Relations and the Law, p. 725,
728)

The respondents' allegation that Tabasondra should have returned after being refused readmission
on June 2, 1958, is not persuasive. When the employer puts off reinstatement when an employee
reports for work at the time agreed, we consider the employee relieved from the duty of returning
further.

Sixto Tongos was dismissed allegedly because he revealed that despite the fact that the Companies
spent more than P80,000 for the vacation trips of officials, they refused to grant union demands;
hence, he betrayed his trust as an auditor of the Companies. We do not find this allegation
convincing. First, this accusation was emphatically denied by Tongos on the witness stand.
Gonzales, president of one of the respondent Companies and one of the officials referred to, took a
trip abroad in 1958. Exchange controls were then in force, and an outgoing traveller on a combined
business and vacation trip was allowed by the Central Bank, per its Circular 52 (Notification to
Authorized Agent Banks) dated May 9, 1952, an allocation of $1,000 or only P2,000, at the official
rate of two pesos to the dollar, as pocket money; hence, this was the only amount that would appear
on the books of the Companies. It was only on January 21, 1962, per its Circular 133 (Notification to
Authorized Agent Banks), that the Central Bank lifted the exchange controls. Tongos could not
therefore have revealed an amount bigger than the above sum. And his competence in figures could
not be doubted considering that he had passed the board examinations for certified public
accountants. But assuming arguendo that Tongos indeed revealed the true expenses of Gonzales'
trip — which the respondents never denied or tried to
disprove — his statements clearly fall within the sphere of a unionist's right to discuss and advertise
the facts involved in a labor dispute, in accordance with section 9(a)(5) of Republic Act 875 which
guarantees the untramelled exercise by striking employees of the right to give "publicity to the
existence of, or the fact involved in any labor dispute, whether by advertising, speaking, patrolling or
by any method not involving fraud or violence." Indeed, it is not only the right, it is as well the duty, of
every unionist to advertise the facts of a dispute for the purpose of informing all those affected
thereby. In labor disputes, the combatants are expected to expose the truth before the public to
justify their respective demands. Being a union man and one of the strikers, Tongos was expected to
reveal the whole truth on whether or not the respondent Companies were justified in refusing to
accede to union demands. After all, not being one of the supervisors, he was not a part of
management. And his statement, if indeed made, is but an expression of free speech protected by
the Constitution.

Free speech on both sides and for every faction on any side of the labor relation is to
me a constitutional and useful right. Labor is free ... to turn its publicity on any labor
oppression, substandard wages, employer unfairness, or objectionable working
conditions. The employer, too, should be free to answer and to turn publicity on the
records of the leaders of the unions which seek the confidence of his men ...
(Concurring opinion of Justice Jackson in Thomas v. Collins, 323 U.S. 516, 547, 65
Sup. Ct. 315, 89 L. Ed. 430.) (Mathews, Labor Relations and the Law, p. 591.)

The respondents also allege that in revealing certain confidential information, Tongos committed not
only a betrayal of trust but also a violation of the moral principles and ethics of accountancy. But
nowhere in the Code of Ethics for Certified Public Accountants under the Revised Rules and
Regulations of the Board of Accountancy formulated in 1954, is this stated. Moreover, the
relationship of the Companies with Tongos was that of an employer and not a client. And with regard
to the testimonies of Juan Raymundo and Antolin Carillo, both vice-presidents of the Trust Insurance
Agencies, Inc. about the alleged utterances made by Tongos, the lower court should not have given
them much weight. The firm of these witnesses was newly established at that time and was still a
"general agency" of the Companies. It is not therefore amiss to conclude that they were more
inclined to favor the respondents rather than Tongos.

Pacifico Ner, Paulino Bugay, Jose Garcia, Narciso Daño, Vicente Alsol and Hermenigildo Ramirez,
opined the lower court, were constructively dismissed by non-readmission allegedly because they
not only prevented Ramon Garcia, assistant corporate secretary, and Vicente Abella, chief of the
personnel records section of the Companies, from entering the Companies' premises on May 21,
1958, but they also caused bruises and abrasions on Garcia's chest and forehead — acts
considered inimical to the interest of the respondents. The Unions, upon the other hand, insist that
there is complete lack of evidence that Ner took part in pushing Garcia; that it was Garcia who
elbowed his way through the picket lines and therefore Ner shouted "Close up," which the picketers
did; and that Garcia tossed Paulino Bugay's placard and a fight ensued between them in which both
suffered injuries. But despite these conflicting versions of what actually happened on May 21, 1958,
there are grounds to believe that the picketers are not responsible for what happened. The lâwphî1.ñèt

picketing on May 21, 1958, as reported in the police blotter, was peaceful (see Police blotter report,
exh. 3 in CA-G.R. No. 25991-R of the Court of Appeals, where Ner was acquitted). Moreover,
although the Companies during the strike were holding offices at the Botica Boie building at Escolta,
Manila; Tuason Building at San Vicente Street, Manila; and Ayala, Inc. offices at Makati, Rizal,
Garcia, the assistant corporate secretary, and Abella, the chief of the personnel records section,
reported for work at the Insular Life Building. There is therefore a reasonable suggestion that they
were sent to work at the latter building to create such an incident and have a basis for filing criminal
charges against the petitioners in the fiscal's office and applying for injunction from the court of first
instance. Besides, under the circumstances the picketers were not legally bound to yield their
grounds and withdraw from the picket lines. Being where the law expects them to be in the legitimate
exercise of their rights, they had every reason to defend themselves and their rights from any assault
or unlawful transgression. Yet the police blotter, about adverted to, attests that they did not resort to
violence.

The heated altercations and occasional blows exchanged on the picket line do not affect or diminish
the right to strike. Persuasive on this point is the following commentary: .

We think it must be conceded that some disorder is unfortunately quite usual in any
extensive or long drawn out strike. A strike is essentially a battle waged with
economic weapons. Engaged in it are human beings whose feelings are stirred to the
depths. Rising passions call forth hot words. Hot words lead to blows on the picket
line. The transformation from economic to physical combat by those engaged in the
contest is difficult to prevent even when cool heads direct the fight. Violence of this
nature, however much it is to be regretted, must have been in the contemplation of
the Congress when it provided in Sec. 13 of Act 29 USCA Sec. 163, that nothing
therein should be construed so as to interfere with or impede or diminish in any way
the right to strike. If this were not so, the rights afforded to employees by the Act
would indeed be illusory. We accordingly recently held that it was not intended by the
Act that minor disorders of this nature would deprive a striker of the possibility of
reinstatement. (Republic Steel Corp. v. N. L. R. B., 107 F2d 472, cited in Mathews,
Labor Relations and the Law, p. 378)

Hence the incident that occurred between Ner, et al. and Ramon Garcia was but a necessary
incident of the strike and should not be considered as a bar to reinstatement. Thus it has been held
that:
Fist-fighting between union and non-union employees in the midst of a strike is no bar to
reinstatement. (Teller, Labor Disputes and Collective Bargaining, Vol. II, p. 855 citing Stackpole
Carbon, Co. 6 NLRB 171, enforced 105 F2d 167.)

Furthermore, assuming that the acts committed by the strikers were transgressions of law, they
amount only to mere ordinary misdemeanors and are not a bar to reinstatement.

In cases involving misdemeanors the board has generally held that unlawful acts are not bar to
reinstatement. (Teller, Labor Disputes and Collective Bargaining, Id., p. 854, citing Ford Motor
Company, 23 NLRB No. 28.)

Finally, it is not disputed that despite the pendency of criminal charges against non-striking
employees before the fiscal's office, they were readily admitted, but those strikers who had pending
charges in the same office were refused readmission. The reinstatement of the strikers is thus in
order.

[W]here the misconduct, whether in reinstating persons equally guilty with those
whose reinstatement is opposed, or in other ways, gives rise to the inference that
union activities rather than misconduct is the basis of his [employer] objection, the
Board has usually required reinstatement." (Teller, supra, p. 853, citing the Third
Annual Report of NLRB [1938], p. 211.)

Lastly, the lower Court justified the constructive dismissal of Florencio Ibarra allegedly because he
committed acts inimical to the interest of the respondents when, as president of the FGU Workers
and Employees Association-NATU, he advised the strikers that they could use force and violence to
have a successful picket and that picketing was precisely intended to prevent the non-strikers and
company clients and customers from entering the Companies' buildings. Even if this were true, the
record discloses that the picket line had been generally peaceful, and that incidents happened only
when management men made incursions into and tried to break the picket line. At any rate, with or
without the advice of Ibarra, picketing is inherently explosive. For, as pointed out by one author, "The
picket line is an explosive front, charged with the emotions and fierce loyalties of the union-
management dispute. It may be marked by colorful name-calling, intimidating threats or sporadic
fights between the pickets and those who pass the line." (Mathews, Labor Relations and the Law, p.
752). The picket line being the natural result of the respondents' unfair labor practice, Ibarra's
misconduct is at most a misdemeanor which is not a bar to reinstatement. Besides, the only
evidence presented by the Companies regarding Ibarra's participation in the strike was the testimony
of one Rodolfo Encarnacion, a former member of the board of directors of the petitioner FGU
Insurance Group Workers and Employees Union-NATU, who became a "turncoat" and who likewise
testified as to the union activities of Atty. Lacsina, Ricardo Villaruel and others (annex C, Decision, p.
27) — another matter which emphasizes the respondents' unfair labor practice. For under the
circumstances, there is good ground to believe that Encarnacion was made to spy on the actvities of
the union members. This act of the respondents is considered unjustifiable interference in the union
activities of the petitioners and is unfair labor practice.

It has been held in a great number of decisions at espionage by an employer of

union activities, or surveillance thereof, are such instances of interference, restraint
or coercion of employees in connection with their right to organize, form and join
unions as to constitute unfair labor practice.

... "Nothing is more calculated to interfere with, restrain and coerce employees in the
exercise of their right to self-organization than such activity even where no
discharges result. The information obtained by means of espionage is in valuable to
 the employer and can be used in a variety of cases to break a union." The unfair
labor practice is committed whether the espionage is carried on by a professional
labor spy or detective, by officials or supervisory employees of the employer, or by
fellow employees acting at the request or direction of the employer, or an ex-
employee..." (Teller, Labor Disputes and Collective Bargaining, Vol. II, pp. 765-766,
and cases cited.) .

IV. The lower court should have ordered the reinstatement of the officials and members of the
Unions, with full back wages from June 2, 1958 to the date of their actual reinstatement to their usual
employment. Because all too clear from the factual and environmental milieu of this case, coupled
with settled decisional law, is that the Unions went on strike because of the unfair labor practices
committed by the respondents, and that when the strikers reported back for work — upon the
invitation of the respondents — they were discriminatorily dismissed. The members and officials of
the Unions therefore are entitled to reinstatement with back pay.

[W]here the strike was induced and provoked by improper conduct on the part of an
employer amounting to an 'unfair labor practice,' the strikers are entitled to
reinstatement with back pay. (Rothenberg on Labor Relations, p. 418.)

[A]n employee who has been dismissed in violation of the provisions of the Act is
entitled to reinstatement with back pay upon an adjudication that the discharge was
illegal." (Id., citing Waterman S. S. Corp. v. N. L. R. B., 119 F2d 760; N. L. R. B. v.
Richter's Bakery, 140 F2d 870; N. L. R. B. v. Southern Wood Preserving Co., 135 F.
2d 606; C. G. Conn, Ltd. v. N. L. R. B., 108 F2d 390; N. L. R. B. v. American Mfg.
Co., 106 F2d 61; N. L. R. B. v. Kentucky Fire Brick Co., 99 F2d 99.)

And it is not a defense to reinstatement for the respondents to allege that the positions of these
union members have already been filled by replacements.

[W]here the employers' "unfair labor practice" caused or contributed to the strike or
where the 'lock-out' by the employer constitutes an "unfair labor practice," the
employer cannot successfully urge as a defense that the striking or lock-out
employees position has been filled by replacement. Under such circumstances, if no
job sufficiently and satisfactorily comparable to that previously held by the aggrieved
employee can be found, the employer must discharge the replacement employee, if
necessary, to restore the striking or locked-out worker to his old or comparable
position ... If the employer's improper conduct was an initial cause of the strike, all
the strikers are entitled to reinstatement and the dismissal of replacement employees
wherever necessary; ... . (Id., p. 422 and cases cited.)

A corollary issue to which we now address ourselves is, from what date should the backpay payable
to the unionists be computed? It is now a settled doctrine that strikers who are entitled to
reinstatement are not entitled to back pay during the period of the strike, even though it is caused by
an unfair labor practice. However, if they offer to return to work under the same conditions just
before the strike, the refusal to re-employ or the imposition of conditions amounting to unfair labor
practice is a violation of section 4(a) (4) of the Industrial Peace Act and the employer is liable for
backpay from the date of the offer (Cromwell Commercial Employees and Laborers Union vs. Court
of Industrial Relations, L-19778, Decision, Sept. 30, 1964, 12 SCRA 124; Id., Resolution on motion
for reconsideration, 13 SCRA 258; see also Mathews, Labor Relations and the Law, p. 730 and the
cited cases). We have likewise ruled that discriminatorily dismissed employees must receive
backpay from the date of the act of discrimination, that is, from the date of their discharge (Cromwell
Commercial Employees and Laborers Union vs. Court of Industrial Relations, supra).
The respondents notified the petitioner strikers to report back for work on June 2, 1958, which the
latter did. A great number of them, however, were refused readmission because they had criminal
charges against them pending before the fiscal's office, although non-strikers who were also facing
criminal indictments were readily readmitted. These strikers who were refused readmission on June
2, 1958 can thus be categorized as discriminatorily dismissed employees and are entitled to
backpay from said date. This is true even with respect to the petitioners Jose Pilapil, Paulino Bugay,
Jr. and Jose Garcia, Jr. who were found guilty only of misdemeanors which are not considered
sufficient to bar reinstatement (Teller, Labor Disputes and Collective Bargaining, p. 854), especially
so because their unlawful acts arose during incidents which were provoked by the respondents'
men. However, since the employees who were denied readmission have been out of the service of
the Companies (for more than ten years) during which they may have found other employment or
other means of livelihood, it is only just and equitable that whatever they may have earned during
that period should be deducted from their back wages to mitigate somewhat the liability of the
company, pursuant to the equitable principle that no one is allowed to enrich himself at the expense
of another (Macleod & Co. of the Philippines v. Progressive Federation of Labor, 97 Phil. 205
[1955]).

The lower court gave inordinate significance to the payment to and acceptance by the dismissed
employees of separation pay. This Court has ruled that while employers may be authorized under
Republic Act 1052 to terminate employment of employees by serving the required notice, or, in the
absence thereof, by paying the required compensation, the said Act may not be invoked to justify a
dismissal prohibited by law, e.g., dismissal for union activities.

... While Republic Act No. 1052 authorizes a commercial establishment to terminate
the employment of its employee by serving notice on him one month in advance, or,
in the absence thereof, by paying him one month compensation from the date of the
termination of his employment, such Act does not give to the employer a blanket
authority to terminate the employment regardless of the cause or purpose behind
such termination. Certainly, it cannot be made use of as a cloak to circumvent a final
order of the court or a scheme to trample upon the right of an employee who has
been the victim of an unfair labor practice. (Yu Ki Lam, et al. v. Nena Micaller, et al.,
99 Phil. 904 [1956].)

Finally, we do not share the respondents' view that the findings of fact of the Court of Industrial
Relations are supported by substantial and credible proof. This Court is not therefore precluded from
digging deeper into the factual milieu of the case (Union of Philippine Education Employees v.
Philippine Education Company, 91 Phil. 93; Lu Do & Lu Ym Corporation v. Philippine-Land-Air-Sea
Labor Union, 11 SCRA 134 [1964]).

V. The petitioners (15 of them) ask this Court to cite for contempt the respondent Presiding Judge
Arsenio Martinez of the Court of Industrial Relations and the counsels for the private respondents,
on the ground that the former wrote the following in his decision subject of the instant petition
for certiorari, while the latter quoted the same on pages 90-91 of the respondents' brief: .

... Says the Supreme Court in the following decisions:

In a proceeding for unfair labor practice, involving a determination as

to whether or not the acts of the employees concerned justified the
adoption of the employer of disciplinary measures against them, the
mere fact that the employees may be able to put up a valid defense in
a criminal prosecution for the same acts, does not erase or neutralize
the employer's right to impose discipline on said employees. For it is
 settled that not even the acquittal of an employee of the criminal
charge against him is a bar to the employer's right to impose
discipline on its employees, should the act upon which the criminal
charged was based constitute nevertheless an activity inimical to the
employer's interest... The act of the employees now under
consideration may be considered as a misconduct which is a just
cause for dismissal. (Lopez, Sr., et al. vs. Chronicle Publication
Employees Ass'n. et al., G.R. No. L-20179-81, December 28, 1964.)
(emphasis supplied)

The two pertinent paragraphs in the above-cited decision * which contained the underscored
portions of the above citation read however as follows:

Differently as regard the dismissal of Orlando Aquino and Carmelito Vicente, we are
inclined to uphold the action taken by the employer as proper disciplinary measure. A
reading of the article which allegedly caused their dismissal reveals that it really
contains an insinuation albeit subtly of the supposed exertion of political pressure by
the Manila Chronicle management upon the City Fiscal's Office, resulting in the non-
filing of the case against the employer. In rejecting the employer's theory that the
dismissal of Vicente and Aquino was justified, the lower court considered the article
as "a report of some acts and omissions of an Assistant Fiscal in the exercise of his
official functions" and, therefore, does away with the presumption of malice. This
being a proceeding for unfair labor practice, the matter should not have been viewed
or gauged in the light of the doctrine on a publisher's culpability under the Penal
Code. We are not here to determine whether the employees' act could stand criminal
prosecution, but only to find out whether the aforesaid act justifies the adoption by
the employer of disciplinary measure against them. This is not sustaining the ruling
that the publication in question is qualified privileged, but even on the assumption
that this is so, the exempting character thereof under the Penal Code does not
necessarily erase or neutralize its effect on the employer's interest which may
warrant employment of disciplinary measure. For it must be remembered that not
even the acquittal of an employee, of the criminal charges against him, is a bar to the
employer's right to impose discipline on its employees, should the act upon which the
criminal charges was based constitute nevertheless an activity inimical to the
employer's interest.

In the herein case, it appears to us that for an employee to publish his "suspicion,"
which actually amounts to a public accusation, that his employer is exerting political
pressure on a public official to thwart some legitimate activities on the employees,
which charge, in the least, would sully the employer's reputation, can be nothing but
an act inimical to the said employer's interest. And the fact that the same was made
in the union newspaper does not alter its deleterious character nor shield or protect a
reprehensible act on the ground that it is a union activity, because such end can be
achieved without resort to improper conduct or behavior. The act of the employees
now under consideration may be considered as a misconduct which is a just cause
for dismissal.** (Emphasis ours)

It is plain to the naked eye that the 60 un-underscored words of the paragraph quoted by the
respondent Judge do not appear in the pertinent paragraph of this Court's decision in L-20179-81.
Moreover, the first underscored sentence in the quoted paragraph starts with "For it is settled ..."
whereas it reads, "For it must be remembered ...," in this Court's decision. Finally, the second and
last underlined sentence in the quoted paragraph of the respondent Judge's decision, appears not in
the same paragraph of this Court's decision where the other sentence is, but in the immediately
succeeding paragraph.

This apparent error, however, does not seem to warrant an indictment for contempt against the
respondent Judge and the respondents' counsels. We are inclined to believe that the misquotation is
more a result of clerical ineptitude than a deliberate attempt on the part of the respondent Judge to
mislead. We fully realize how saddled with many pending cases are the courts of the land, and it is
not difficult to imagine that because of the pressure of their varied and multifarious work, clerical
errors may escape their notice. Upon the other hand, the respondents' counsels have the prima
facie right to rely on the quotation as it appears in the respondent Judge's decision, to copy it
verbatim, and to incorporate it in their brief. Anyway, the import of the underscored sentences of the
quotation in the respondent Judge's decision is substantially the same as, and faithfully reflects, the
particular ruling in this Court's decision, i.e., that "[N]ot even the acquittal of an employee, of the
criminal charges against him, is a bar to the employer's right to impose discipline on its employees,
should the act upon which the criminal charges were based constitute nevertheless an activity
inimical to the employer's interest."

Be that as it may, we must articulate our firm view that in citing this Court's decisions and rulings, it is
the bounden duty of courts, judges and lawyers to reproduce or copy the same word-for-word and
punctuation mark-for-punctuation mark. Indeed, there is a salient and salutary reason why they
should do this. Only from this Tribunal's decisions and rulings do all other courts, as well as lawyers
and litigants, take their bearings. This is because the decisions referred to in article 8 of the Civil
Code which reads, "Judicial decisions applying or interpreting the laws or the Constitution shall form
a part of the legal system of the Philippines," are only those enunciated by this Court of last resort.
We said in no uncertain terms in Miranda, et al. vs. Imperial, et al. (77 Phil. 1066) that "[O]nly the
decisions of this Honorable Court establish jurisprudence or doctrines in this jurisdiction." Thus, ever
present is the danger that if not faithfully and exactly quoted, the decisions and rulings of this Court
may lose their proper and correct meaning, to the detriment of other courts, lawyers and the public
who may thereby be misled. But if inferior courts and members of the bar meticulously discharge
their duty to check and recheck their citations of authorities culled not only from this Court's
decisions but from other sources and make certain that they are verbatim reproductions down to the
last word and punctuation mark, appellate courts will be precluded from acting on misinformation, as
well as be saved precious time in finding out whether the citations are correct.

Happily for the respondent Judge and the respondents' counsels, there was no substantial change in
the thrust of this Court's particular ruling which they cited. It is our view, nonetheless, that for their
mistake, they should be, as they are hereby, admonished to be more careful when citing
jurisprudence in the future. ACCORDINGLY, the decision of the Court of Industrial Relations dated
August 17, 1965 is reversed and set aside, and another is entered, ordering the respondents to
reinstate the dismissed members of the petitioning Unions to their former or comparatively similar
positions, with backwages from June 2, 1958 up to the dates of their actual reinstatements. Costs
against the respondents.
 G.R. Nos. 164302-03 January 24, 2007
SANTA ROSA COCA-COLA PLANT EMPLOYEES UNION, DONRICO V. SEBASTIAN, EULOGIO
G. BATINO, SAMUEL A. ATANQUE, MANOLO C. ZABALJAUREGUI, DIONISIO TENORIO,
EDWIN P. RELLORES, LUIS B. NATIVIDAD, MYRNA PETINGCO, FELICIANO TOLENTINO,
RODOLFO A. AMANTE, JR., CIPRIANO C. BELLO, RONALDO T. ESPINO, EFREN GALAN, and
JUN CARMELITO SANTOS, Petitioners,
vs.
COCA-COLA BOTTLERS PHILS., INC., Respondent.

This is a petition for review on certiorari of the Decision1 of the Court of Appeals (CA) in CA-G.R. SP
Nos. 74174 and 74860, which affirmed the ruling of the National Labor Relations Commission
(NLRC) in NLRC CA No. 030424-02, and the Labor Arbiter in NLRC Case No. RAB-IV-10-11579-99-
L.

The Antecedents

The Sta. Rosa Coca-Cola Plant Employees Union (Union) is the sole and exclusive bargaining
representative of the regular daily paid workers and the monthly paid non-commission-earning
employees of the Coca-Cola Bottlers Philippines, Inc. (Company) in its Sta. Rosa, Laguna plant. The
individual petitioners are Union officers, directors, and shop stewards.

The Union and the Company had entered into a three-year Collective Bargaining Agreement (CBA)
effective July 1, 1996 to expire on June 30, 1999. Upon the expiration of the CBA, the Union
informed the Company of its desire to renegotiate its terms. The CBA meetings commenced on July
26, 1999, where the Union and the Company discussed the ground rules of the negotiations. The
Union insisted that representatives from the Alyansa ng mga Unyon sa Coca-Cola be allowed to sit
down as observers in the CBA meetings. The Union officers and members also insisted that their
wages be based on their work shift rates. For its part, the Company was of the view that the
members of the Alyansa were not members of the bargaining unit. The Alyansa was a mere
aggregate of employees of the Company in its various plants; and is not a registered labor
organization. Thus, an impasse ensued.2

On August 30, 1999, the Union, its officers, directors and six shop stewards filed a "Notice of Strike"
with the National Conciliation and Mediation Board (NCMB) Regional Office in Southern Tagalog,
Imus, Cavite. The petitioners relied on two grounds: (a) deadlock on CBA ground rules; and (b)
unfair labor practice arising from the company’s refusal to bargain. The case was docketed as
NCMB-RBIV-NS-08-046-99.3

The Company filed a Motion to Dismiss4 alleging that the reasons cited by the Union were not valid
grounds for a strike. The Union then filed an Amended Notice of Strike on September 17, 1999 on
the following grounds: (a) unfair labor practice for the company’s refusal to bargain in good faith; and
(b) interference with the exercise of their right to self-organization.5

Meanwhile, on September 15, 1999, the Union decided to participate in a mass action organized by
the Alyansa ng mga Unyon sa Coca-Cola in front of the Company’s premises set for September 21,
1999. 106 Union members, officers and members of the Board of Directors, and shop stewards,
individually filed applications for leave of absence for September 21, 1999. Certain that its
operations in the plant would come to a complete stop since there were no sufficient trained
contractual employees who would take over, the Company disapproved all leave applications and
notified the applicants accordingly.6 A day before the mass action, some Union members wore
gears, red tag cloths stating "YES KAMI SA STRIKE" as headgears and on the different parts of their
uniform, shoulders and chests.
The Office of the Mayor issued a permit to the Union, allowing it "to conduct a mass protest action
within the perimeter of the Coca-Cola plant on September 21, 1999 from 9:00 a.m. to 12:00
noon."7 Thus, the Union officers and members held a picket along the front perimeter of the plant on
September 21, 1999. All of the 14 personnel of the Engineering Section of the Company did not
report for work, and 71 production personnel were also absent. As a result, only one of the three
bottling lines operated during the day shift. All the three lines were operated during the night shift
with cumulative downtime of five (5) hours due to lack of manning, complement and skills
requirement. The volume of production for the day was short by 60,000 physical case[s] versus
budget.8

On October 13, 1999, the Company filed a "Petition to Declare Strike Illegal"9 alleging, inter alia, the
following: there was a deadlock in the CBA negotiations between the Union and Company, as a
result of which a Notice of Strike was filed by the Union; pending resolution of the Notice of Strike,
the Union members filed applications for leave on September 21, 1999 which were disapproved
because operations in the plant may be disrupted; on September 20, 1999, one day prior to the
mass leave, the Union staged a protest action by wearing red arm bands denouncing the alleged
anti-labor practices of the company; on September 21, 1999, without observing the requirements
mandated by law, the Union picketed the premises of the Company in clear violation of Article 262 of
the Labor Code; because of the slowdown in the work, the Company suffered losses amounting
to P2,733,366.29; the mass/protest action conducted on September 21, 1999 was clearly a strike;
since the Union did not observe the requirements mandated by law, i.e., strike vote, cooling-off
period and reporting requirements, the strike was therefore illegal; the Union also violated the
provision of the CBA on the grievance machinery; there being a direct violation of the CBA, the
Union’s action constituted an unfair labor practice; and the officers who knowingly participated in the
commission of illegal acts during the strike should be declared to have lost their employment status.
The Company prayed that judgment be rendered as follows:

1. Declaring the strike illegal;

2. Declaring the officers of respondent Union or the individual respondents to have lost their
employment status;

3. Declaring respondent Union, its officers and members guilty of unfair labor practice for
violation of the CBA; and

4. Ordering the respondents to pay petitioner the following claims for damages:

a. Actual Damages in the amount of P 4,733,366.29

b. Moral Damages in the amount of Five (5) Million Pesos; and

c. Exemplary Damages in the amount of Two (2) Million Pesos.10

The Union filed an Answer with a Motion to Dismiss and/or to Suspend Proceedings11 alleging
therein that the mass action conducted by its officers and members on September 21, 1999 was not
a strike but just a valid exercise of their right to picket, which is part of the right of free expression as
guaranteed by the Constitution; several thousands of workers nationwide had launched similar mass
protest actions to demonstrate their continuing indignation over the ill effects of martial rule in the
Philippines.12 It pointed out that even the officers and members of the Alyansa ng mga Unyon sa
Coca-Cola had similarly organized mass protest actions. The Union insisted that officers and
members filed their applications for leave for September 21, 1999 knowing fully well that there were
no bottling operations scheduled on September 21 and 22, 1999; they even secured a Mayor’s
permit for the purpose. The workers, including the petitioners, merely marched to and fro at the side
of the highway near one of the gates of the Sta. Rosa Plant, the loading bay for public vehicles. After
3 hours, everyone returned to work according to their respective shifting schedules. The Union
averred that the petition filed by the Company was designed to harass and its officers and members
in order to weaken the Union’s position in the on-going collective bargaining negotiations.

In a letter to the Union President dated October 26, 1999, the NCMB stated that based on their
allegations, the real issue between the parties was not the proper subject of a strike, and should be
the subject of peaceful and reasonable dialogue. The NCMB recommended that the Notice of Strike
of the Union be converted into a preventive mediation case. After conciliation proceedings failed, the
parties were required to submit their respective position papers.13 In the meantime, the officers and
directors of the Union remained absent without the requisite approved leaves. On October 11, 1999,
they were required to submit their explanations why they should not be declared AWOL.14

On November 26, 1999, the Labor Arbiter rendered a Decision15 granting the petition of the
Company. He declared that the September 21, 1999 mass leave was actually a strike under Article
212 of the Labor Code for the following reasons: based on the reports submitted by the Production
and Engineering Department of the Company, there was a temporary work stoppage/slowdown in
the company;16 out of the usual three (3) lines for production for the day shift, only one line operated
by probationary employees was functional and there was a cumulative downtime of five (5) hours
attributed to the lack of manning complement and skills requirement. The Labor Arbiter further
declared:

x x x [T]he September 21, 1999 activity of the union and the individual respondents herein fell within
the foregoing definition of a strike. Firstly, the union itself had admitted the fact that on the date in
question, respondent officers, together with their union members and supporters from the Alyansa
ng mga Unyon sa Coca-Cola, did not report for their usual work. Instead, they all assembled in front
of the Sta. Rosa Plant and picketed the premises. Very clearly, there was a concerted action here on
the part of the respondents brought about a temporary stoppage of work at two out of three bottling
lines at the Sta. Rosa Plant. According to Edwin Jaranilla, the Engineering Superintendent (Annex H,
petition), all of his department’s 14 engineering personnel did not report for work on September 21,
1999, and that only Line 2 operated on the day shift. Honorio Tacla, the Production Superintendent,
testified (Annex H-1), that 71 production personnel were likewise absent from their respective work
stations on September 21, 1999, and that only Line 2 operated on the day shift. Similarly, Federico
Borja, Physical Distribution Superintendent, stated under oath (Annex H-2) that 12 personnel from
his department did not report for work on September 21, 1999, and that no forklift servicing was
done on Lines 1 and 3. From the foregoing testimonies, it is evident that respondents’ concerted
activity resulted in a temporary stoppage of work at the Sta. Rosa Plant of the company. Thirdly,
such concerted activity by respondents was by reason of a labor dispute. Earlier, the union had filed
a Notice of Strike against the company on account of a disagreement with the latter regarding CBA
ground rules, i.e., the demand of the Union for Alyansa members from other plants to attend as
observers during the CBA negotiation, and for the members of the negotiating panel to be paid their
wages based on their work shift rate. Moreover, on September 20, 1999, one day before
respondents’ mass leave from work and concerted action, they had worn red tag cloth materials on
different parts of their uniform which contained the words, "YES kami sa strike"; "Protesta kami";
"Sahod, karapatan, manggagawa ipaglaban"; and "Union busting itigil." (Annexes G, G-1, G-2 & G-
3). These indicated that the concerted action taken by respondents against CCBPI was a result of or
on account of a labor dispute.17

According to the Labor Arbiter, the strike conducted by the Union was illegal since there was no
showing that the Union conducted a strike vote, observed the prescribed cooling-off period, much
less, submitted a strike vote to the DOLE within the required time. Consequently, for knowingly
participating in the illegal strike, the individual petitioners were considered to have lost their
employment status.18

The Union appealed the decision to the NLRC. On July 31, 2002, the NLRC affirmed the decision of
the Labor Arbiter with the modification that Union Treasurer Charlita M. Abrigo, who was on
bereavement leave at the time, should be excluded from the list of those who participated in the
illegal strike. She was thus ordered reinstated to her former position with full backwages and
benefits.19

The Union and its officers, directors and the shop stewards, filed a petition for certiorari in the CA.
The case was docketed as CA-G.R. SP No. 74174. Another petition was filed by Ricky G. Ganarial
and Almira Romo, docketed as CA-G.R. SP No. 74860. The two cases were consolidated in the 6th
Division of the CA.

Petitioners alleged the following in their respective petitions:

THE NLRC COMMITTED GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OF

JURISDICTION FOR HAVING DECLARED PETITIONERS TO HAVE LOST THEIR EMPLOYMENT
WHEN FACTS WOULD SHOW PETITIONERS WERE NOT AFFORDED DUE PROCESS

II

THE NLRC COMMITTED GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OF

JURISDICTION IN DECLARING THE PEACEFUL PICKETING CONDUCTED BY THE UNION AS
ILLEGAL STRIKE DESPITE ABSENCE OF SUBSTANTIAL EVIDENCE ON THE INTENT TO
CREATE TEMPORARY WORK STOPPAGE

III

THE NLRC COMMITTED GRAVE ABUSE OF DISCRETION AMOUNTING TO LACK OF

JURISDICTION IN DECLARING THAT PETITIONERS HAVE LOST THEIR EMPLOYMENT FOR
KNOWINGLY PARTICIPATING IN AN ILLEGAL STRIKE DESPITE THE FACT THAT
PETITIONERS ARE NOT ELECTED OFFICERS OF THE UNION AND ARE MERE SHOP
STEWARDS AND DESPITE THE FACT THAT THERE WAS NO PROOF THAT THEY
COMMITTED ILLEGAL ACTS.20

The petitioners, likewise, raised the following, to wit:

WHETHER OR NOT PUBLIC RESPONDENT NLRC HAS GRAVELY ABUSED ITS DISCRETION
AMOUNTING TO EXCESS OR LACK OF JURISDICTION IN AFFIRMING THE DECISION OF THE
LABOR ARBITER A QUO WHO COMMITTED SERIOUS ERRORS IN HIS FINDINGS OF FACTS
WHEN HE DECLARED THAT THE STRIKE CONDUCTED BY THE RESPONDENTS ON
SEPTEMBER 21, 1999 IS ILLEGAL.

WHETHER OR NOT PUBLIC RESPONDENT NLRC HAS GRAVELY ABUSED ITS DISCRETION
AMOUNTING TO EXCESS OR LACK OF JURISDICTION IN AFFIRMING THE DECISION OF THE
LABOR ARBITER A QUO WHO COMMITTED SERIOUS ERRORS IN HIS FINDINGS OF FACTS
WHEN HE DECLARED THAT INDIVIDUAL RESPONDENTS (NOW PETITIONERS), INCLUDING
SIX (6) UNION SHOP STEWARDS, ARE CONSIDERED TO HAVE LOST THEIR EMPLOYMENT
STATUS (EXCEPT CHARLITA ABRIGO) FOR KNOWINGLY PARTICIPATING IN SAID ILLEGAL
STRIKE.21

On September 10, 2003, the CA rendered judgment dismissing the petition for lack of merit. It also
declared that petitioners, in CA-G.R. SP No. 74860, were guilty of forum shopping.

Petitioners filed a motion for reconsideration which the appellate court denied; hence, the instant
petition was filed based on the following grounds:

(1) THE HONORABLE COURT OF APPEALS HAS GRAVELY ABUSED ITS DISCRETION
IN DISMISSING THE PETITION BEFORE IT FOR LACK OF MERIT WHEN IT IS CLEAR
FROM THE EVIDENCE ON RECORD THAT THE SUBJECT MASS ACTION WAS A VALID
EXERCISE OF THE WORKERS’ CONSTITUTIONAL RIGHT TO PICKET WHICH IS PART
OF THE RIGHT TO FREE EXPRESSION.

(2) THE NLRC GRAVELY ABUSED ITS DISCRETION IN AFFIRMING THE DECISION OF
THE LABOR ARBITER A QUO WHEN IT CONCLUDED THAT AS A CONSEQUENCE OF
THE ILLEGALITY OF THE STRIKE, THE DISMISSAL OF THE OFFICERS OF THE UNION
IS JUSTIFIED AND VALID, IS NOT IN ACCORD WITH FACTS AND EVIDENCE ON
RECORD.

(3) EVEN ASSUMING ARGUENDO THAT THE PROTEST MASS ACTION STAGED BY
PETITIONERS ON SEPTEMBER 21, 1999 CONSTITUTES A STRIKE, THE NLRC
SERIOUSLY ERRED WHEN IT AFFIRMED THE LABOR ARBITER’S DECISION
DECLARING THE FORFEITURE OF EMPLOYMENT STATUS OF UNION OFFICERS AND
SHOP STEWARDS (WHO HAVE NOT COMMITTED ANY ILLEGAL ACT DURING THE
CONDUCT OF THE SAID MASS ACTION) FOR HAVING KNOWINGLY PARTICIPATED IN
AN ILLEGAL STRIKE.22

The threshold issues in these cases are: (a) whether the September 21, 1999 mass action staged by
the Union was a strike; (b) if, in the affirmative, whether it was legal; and (c) whether the individual
officers and shop stewards of petitioner Union should be dismissed from their employment.

On the first and second issues, petitioners maintain that the September 21, 1999 mass protest
action was not a strike but a picket, a valid exercise of their constitutional right to free expression
and assembly.23 It was a peaceful mass protest action to dramatize their legitimate grievances
against respondent. They did not intend to have a work stoppage since they knew beforehand that
no bottling operations were scheduled on September 21, 1999 pursuant to the Logistics Planning
Services Mega Manila Production Plan dated September 15, 1999.24 Thus, they applied for leaves of
absences for September 21, 1999 which, however, were not approved. They also obtained a
mayor’s permit to hold the picket near the highway, and they faithfully complied with the conditions
set therein. The protesting workers were merely marching to and fro at the side of the highway or the
loading bay near one of the gates of the Company plant, certainly not blocking in any way the
ingress or egress from the Company’s premises. Their request to hold their activity was for four (4)
hours, which was reduced to three (3) hours. Thereafter, they all went back to work. The bottling
operations of the Company was not stopped, even temporarily. Since petitioner Union did not intend
to go on strike, there was no need to observe the mandatory legal requirements for the conduct of a
strike.

Petitioners also point out that members belonging to the IBM-KMU at the San Fernando Coca-Cola
bottling plant staged simultaneous walkout from their work assignments for two consecutive days, on
October 7 and 8, 1999. However, the Secretary of Labor and Employment (SOLE) declared that the
walkout was considered a mass action, not a strike, and the officers of the IBM-KMU were only
meted a three-day suspension. Respondent accepted the decision of the SOLE and no longer
appealed the decision. Petitioners insist that this should, likewise, apply in the resolution of the issue
of whether petitioners staged a strike or not, and whether the penalty of dismissal from the
employment with the respondent is just and equitable.

Petitioners also insist that they were denied the right to due process because the decision of the
Labor Arbiter was implemented even while their appeal was pending in the NLRC. The decision of
the Labor Arbiter against them was to become final and executory only until after the NLRC shall
have resolved their appeal with finality.

On the third issue, petitioners aver that even assuming that they had indeed staged a strike, the
penalty of dismissal is too harsh. They insist that they acted in good faith. Besides, under Article 264
of the Labor Code, the dismissal of the Union officers who participated in an illegal strike is
discretionary on the employer. Moreover, six (6) of the petitioners were shop stewards who were
mere members of the Union and not officers thereof.

In its comment on the petition, respondent avers that the issues raised by petitioners are factual;
hence, inappropriate in a petition for review on certiorari. Besides, the findings of the Labor Arbiter
had been affirmed by the NLRC and the CA, and are, thus, conclusive on this Court.

Respondent further avers that the law offers no discretion as to the proper penalty that should be
imposed against a Union official participating in an illegal strike. Contrary to the contention of
petitioners, shop stewards are also Union officers. To support its claim, respondent cited Samahan
ng Manggagawa sa Moldex Products, Inc. v. National Labor Relations Commission,25 International
Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America v. Hoffa;26 and
Coleman v. Brotherhood of Railway and Steamship Clerks, etc.27

The petition is denied for lack of merit.

The ruling of the CA that petitioners staged a strike on September 21, 1999, and not merely a picket
is correct.

It bears stressing that this is a finding made by the Labor Arbiter which was affirmed by the
NLRC28 and the CA.29 The settled rule is that the factual findings and conclusions of tribunals, as
long as they are based on substantial evidence, are conclusive on this Court.30 The raison d’etre is
that quasi-judicial agencies, like the Labor Arbiter and the NLRC, have acquired a unique expertise
since their jurisdictions are confined to specific matters. Besides, under Rule 45 of the Rules of
Court, the factual issues raised by the petitioner are inappropriate in a petition for review on
certiorari. Whether petitioners staged a strike or not is a factual issue.

Petitioners failed to establish that the NLRC committed grave abuse of its discretion amounting to
excess or lack of jurisdiction in affirming the findings of the Labor Arbiter that petitioners had indeed
staged a strike.

Article 212(o) of the Labor Code defines strike as a temporary stoppage of work by the concerted
action of employees as a result of an industrial or labor dispute. In Bangalisan v. Court of
Appeals,31 the Court ruled that "the fact that the conventional term ‘strike’ was not used by the
striking employees to describe their common course of action is inconsequential, since the
substance of the situation, and not its appearance, will be deemed to be controlling."32 The term
"strike" encompasses not only concerted work stoppages, but also slowdowns, mass leaves, sit-
downs, attempts to damage, destroy or sabotage plant equipment and facilities, and similar
activities.33

Picketing involves merely the marching to and fro at the premises of the employer, usually
accompanied by the display of placards and other signs making known the facts involved in a labor
dispute.34 As applied to a labor dispute, to picket means the stationing of one or more persons to
observe and attempt to observe. The purpose of pickets is said to be a means of peaceable
persuasion.35

A labor dispute includes any controversy or matter concerning terms or conditions of employment or
the association or representation of persons in negotiating, fixing, maintaining, changing or arranging
the terms and conditions of employment, regardless of whether the disputants stand in the proximate
relation of employer and employee.36

That there was a labor dispute between the parties, in this case, is not an issue. Petitioners notified
the respondent of their intention to stage a strike, and not merely to picket. Petitioners’ insistence to
stage a strike is evident in the fact that an amended notice to strike was filed even as respondent
moved to dismiss the first notice. The basic elements of a strike are present in this case: 106
members of petitioner Union, whose respective applications for leave of absence on September 21,
1999 were disapproved, opted not to report for work on said date, and gathered in front of the
company premises to hold a mass protest action. Petitioners deliberately absented themselves and
instead wore red ribbons, carried placards with slogans such as: "YES KAMI SA STRIKE,"
"PROTESTA KAMI," "SAHOD, KARAPATAN NG MANGGAGAWA IPAGLABAN," "CBA-‘WAG
BABOYIN," "STOP UNION BUSTING." They marched to and fro in front of the company’s premises
during working hours. Thus, petitioners engaged in a concerted activity which already affected the
company’s operations. The mass concerted activity constituted a strike.

The bare fact that petitioners were given a Mayor’s permit is not conclusive evidence that their
action/activity did not amount to a strike. The Mayor’s description of what activities petitioners were
allowed to conduct is inconsequential. To repeat, what is definitive of whether the action staged by
petitioners is a strike and not merely a picket is the totality of the circumstances surrounding the
situation.

A strike is the most powerful of the economic weapons of workers which they unsheathe to force
management to agree to an equitable sharing of the joint product of labor and capital. It is a weapon
that can either breathe life to or destroy the Union and its members in their struggle with
management for a more equitable due to their labors.37 The decision to declare a strike must
therefore rest on a rational basis, free from emotionalism, envisaged by the tempers and tantrums of
a few hot heads, and finally focused on the legitimate interests of the Union which should not,
however, be antithetical to the public welfare, and, to be valid, a strike must be pursued within legal
bounds. The right to strike as a means of attainment of social justice is never meant to oppress or
destroy the employer.38

Since strikes cause disparity effects not only on the relationship between labor and management but
also on the general peace and progress of society, the law has provided limitations on the right to
strike. For a strike to be valid, the following procedural requisites provided by Art. 263 of the Labor
Code must be observed: (a) a notice of strike filed with the DOLE 30 days before the intended date
thereof, or 15 days in case of unfair labor practice; (b) strike vote approved by a majority of the total
union membership in the bargaining unit concerned obtained by secret ballot in a meeting called for
that purpose, (c) notice given to the DOLE of the results of the voting at least seven days before the
intended strike. These requirements are mandatory and the failure of a union to comply therewith
renders the strike illegal.39 It is clear in this case that petitioners totally ignored the statutory
requirements and embarked on their illegal strike. We quote, with approval, the ruling of the CA
which affirmed the decisions of the NLRC and of the Labor Arbiter:

Since it becomes undisputed that the mass action was indeed a strike, the next issue is to determine
whether the same was legal or not. Records reveal that the said strike did not comply with the
requirements of Article 263 (F) in relation to Article 264 of the Labor Code, which specifically
provides, thus:

ART. 263. STRIKES, PICKETING, AND LOCKOUTS

xxx xxx xxx xxx

(f) A decision to declare a strike must be approved by a majority of the total union membership in the
bargaining unit concerned, obtained by secret ballot in meetings or referenda called for that purpose.
A decision to declare a lockout must be approved by a majority of the board of directors of the
corporation or association or of the partners in a partnership, obtained by secret ballot in a meeting
called for that purpose. The decision shall be valid for the duration of the dispute based on
substantially the same grounds considered when the strike or lockout vote was taken. The Ministry
may at its own initiative or upon the request of any affected party, supervise the conduct of the
secret balloting. In every case, the union or the employer shall furnish the Ministry the results of the
voting at least seven days before the intended strike or lockout, subject to the cooling-off period
herein provided.

ART. 264. PROHIBITED ACTIVITIES

(a) No labor organization or employer shall declare a strike or lockout without first having bargained
collectively in accordance with Title VII of this Book or without first having filed the notice required in
the preceding article or without the necessary strike or lockout vote first having been obtained and
reported to the Ministry.

No strike or lockout shall be declared after assumption of jurisdiction by the President or the Minister
or after certification or submission of the dispute to compulsory or voluntary arbitration or during the
pendency of cases involving the same grounds for the strike or lockout.

Any worker whose employment has been terminated as a consequence or an unlawful lockout shall
be entitled to reinstatement with full backwages. Any union officer who knowingly participates in an
illegal strike and any worker or union officer who knowingly participates in the commission of illegal
acts during a strike may be declared to have lost his employment status: Provided, That mere
participation of a worker in a lawful strike shall not constitute sufficient ground for termination of his
employment, even if a replacement had been hired by the employer during such lawful strike.

xxx xxx xxx xxx

Applying the aforecited mandatory requirements to the case at bench, the Labor Arbiter found, thus:

In the present case, there is no evidence on record to show that respondents had complied with the
above mandatory requirements of law for a valid strike. Particularly, there is no showing that
respondents had observed the prescribed cooling-off period, conducted a strike vote, much less
submitted a strike vote report to the Department of Labor within the required time. This being the
case, respondents’ strike on September 21, 1999 is illegal. In the recent case of CCBPI Postmix
Workers Union vs. NLRC, 2999 (sic) SCRA 410, the Supreme Court had said: "It bears stressing
that the strike requirements under Article 264 and 265 of the Labor Code are mandatory requisites,
without which, the strike will be considered illegal. The evidence (sic) intention of the law in requiring
the strike notice and strike-vote report as mandatory requirements is to reasonably regulate the right
to strike which is essential to the attainment of legitimate policy objectives embodied in the law.
Verily, substantial compliance with a mandatory provision will not suffice. Strict adherence to the
mandate of the law is required.

Aside from the above infirmity, the strike staged by respondents was, further, in violation of the CBA
which stipulated under Section 1, Article VI, thereof that,

SECTION 1. The UNION agrees that there shall be no strike, walkout, stoppage or slowdown of
work, boycott, secondary boycott, refusal to handle any merchandise, picketing, sitdown strikes of
any kind, sympathetic or general strike, or any other interference with any of the operations of the
COMPANY during the term of this Agreement, so long as the grievance procedure for which
provision is made herein is followed by the COMPANY.

Here, it is not disputed that respondents had not referred their issues to the grievance machinery as
a prior step. Instead, they chose to go on strike right away, thereby bypassing the required grievance
procedure dictated by the CBA.40

On the second and third issues, the ruling of the CA affirming the decisions of the NLRC and the
Labor Arbiter ordering the dismissal of the petitioners-officers, directors and shop stewards of
petitioner Union is correct.

It bears stressing, however, that the law makes a distinction between union members and union
officers. A worker merely participating in an illegal strike may not be terminated from employment. It
is only when he commits illegal acts during a strike that he may be declared to have lost employment
status.41 For knowingly participating in an illegal strike or participates in the commission of illegal acts
during a strike, the law provides that a union officer may be terminated from employment. 42 The law
grants the employer the option of declaring a union officer who participated in an illegal strike as
having lost his employment. It possesses the right and prerogative to terminate the union officers
from service.43

We quote, with approval, the following ruling of the Court of Appeals:

As to the imposition of the penalty provided for should an illegal strike be declared as such, We find
no legal or factual reason to digress from the following disquisition of the Labor Arbiter, to wit:

No doubt, the strike conducted by respondents on September 21, 1999 is illegal. Under Article
264(a) of the Labor Code, it is stated that, ‘Any union officer who knowingly participates in the
commission of illegal acts during a strike may be declared to have lost his employment status. xxx.’
In the present case, CCBPI had already promptly notified respondents and their members of the
disapproval of their leave. In fact, in the company notice (of the disapproval of their leave), CCBPI
emphasized that "operations will come to a complete stop on September 21, 1999 if all the
applications are approved." They were further informed that, ‘there are no sufficiently trained
contractual employees who can take over as replacements on that day’ (Annexes "C," "C-1" to "C-
18"). In other words, respondents had known beforehand that their planned mass leave would
definitely result in a stoppage of the operations of the company for September 21, 1999. Still,
respondents knowingly and deliberately proceeded with their mass action, unmindful of the ill effects
thereof on the business operations of the company. In the case of Association of Independent
Unions in the Philippines v. NLRC, 305 SCRA 219, the Supreme Court had ruled that,
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 just penalty or sanction for their unlawful acts. The officers’ responsibility is
greater than that of the members.

Here, the law required respondents to follow a set of mandatory procedures before they could go on
with their strike. But obviously, rather than call on their members to comply therewith, respondents
were the first ones to violate the same.44

Petitioners cannot find solace in the Order of the Secretary of Labor and Employment (SOLE) in OS-
A-J-0033-99, NCMB-RB 111-NS-10-44-99 and 11-51-99 involving the labor dispute between the
Company and the Union therein (the Ilaw at Buklod ng Manggagawa Local No. 1, representing the
daily paid rank and file members of the respondent, as well as the plant-based route helpers and
drivers at its San Fernando Plant). In said case, the SOLE found that the simultaneous walkout
staged on October 7 and 8, 1999 was indeed a mass action, initiated by the Union leaders. The acts
of the Union leaders were, however, found to be illegal which warranted their dismissal, were it not
for the presence of mitigating factors,

i.e., the walkout was staged in support of their leaders in the course of the CBA negotiation which
was pending for more than nine (9) months; the Plant was not fully disrupted as the Company was
able to operate despite the severe action of the Union members, with the employment of casual and
contractual workers; the Union had complied with the requirements of a strike and refrained from
staging an actual strike.45

Neither can the petitioners find refuge in the rulings of this Court in Panay Electric Company v.
NLRC46 or in Lapanday Workers Union v. NLRC.47 In the Panay case, the Court meted the
suspension of the union officers, instead of terminating their employment status since the NLRC
found no sufficient proof of bad faith on the part of the union officers who took part in the strike to
protest the dismissal of their fellow worker, Enrique Huyan which was found to be illegal. In
Lapanday, the Court actually affirmed the dismissal of the union officers who could not claim good
faith to exculpate themselves. The officers, in fact, admitted knowledge of the law on strike, including
its procedure in conducting the same. The Court held that the officers cannot violate the law which
was designed to promote their interests.

Finally, the contention of petitioners Elenette Moises, Almira Romo, Louie Labayani, Ricky Ganarial,
Efren Galan and Jun Carmelito Santos who were appointed as shop stewards of the Union that they
were mere members and not the officers of petitioner Union is barren of merit.

We agree with the observation of respondent that under Section 501(a) and (b) of the Landrum
Griffin Act of 1959,48 shop stewards are officers of the Union:

Sec. 501 (a) The officers, agents, shop stewards, and other representatives of a labor organization
occupy positions of trust in relation to such organization and its members as a group. It is, therefore,
the duty of each such person, taking into account the special problems and functions of a labor
organization, to hold its money and property solely for the benefit of the organization and its
members and to manage, invest, and expend the same in accordance with its constitution and
bylaws and any resolutions of the governing bodies adopted thereunder, to refrain from dealing with
such organization as an adverse party in any matter connected with his duties and from holding or
acquiring any pecuniary or personal interest which conflicts with the interest of such organization,
and to account to the organization for any profit received by him in whatever capacity in connection
with transactions conducted by him or under his direction on behalf of the organization. A general
exculpatory resolution of a governing body purporting to relieve any such person of liability for
breach of the duties declared by this section shall be void as against public policy.

(b) When any officer, agent, shop steward, or representative of any labor organization is alleged to
have violated the duties declared in subsection (a) of this section and the labor organization or its
governing board or officers refuse or fail to sue or recover damages or secure an accounting or other
appropriate relief within a reasonable time after being requested to do so by any member of the
labor organization, such member may sue such officer, agent, shop steward, or representative in
any district court of the United States or in any State court of competent jurisdiction to recover
damages or secure an accounting or other appropriate relief for the benefit of the labor
organization.49

Under said Act, Section 3(q) thereof provides, as follows:

(q) "Officer, agent, shop steward, or other representative", when used with respect to a labor
organization, includes elected officials and key administrative personnel, whether elected or
appointed (such as business agents, heads of departments or major units, and organizers who
exercise substantial independent authority), but does not include salaried non-supervisory
professional staff, stenographic, and service personnel.50

Admittedly, there is no similar provision in the Labor Code of the Philippines; nonetheless,
petitioners who are shop stewards are considered union officers.

Officers normally mean those who hold defined offices. An officer is any person occupying a position
identified as an office. An office may be provided in the constitution of a labor union or by the union
itself in its CBA with the employer. An office is a word of familiar usage and should be construed
according to the sense of the thing.51

Irrefragably, under its Constitution and By-Laws, petitioner Union has principal officers and
subordinate officers, who are either elected by its members, or appointed by its president, including
the standing committees each to be headed by a member of the Board of Directors. Thus, under
Section 1, Article VI of petitioner Union’s Constitution and By-Laws, the principal officers and other
officers, as well as their functions/duties and terms of office, are as follows:

ARTICLE VI
PRINCIPAL OFFICERS

SECTION 1. The governing body of the UNION shall be the following officers who shall be elected
through secret ballot by the general membership:

President Auditor

Vice-President– two (2) Public Relations Officer

Secretary Sergeant-at-Arms

Treasurer Board of Directors – nine (9)

SECTION 2. The above officers shall administer Union’s affairs, formulate policies and implement
programs to effectively carry out the objectives of the UNION and the Labor Code of the Philippines
and manage all the monies and property of the UNION.

SECTION 3. The officers of the UNION and the members of the Board of Directors shall hold office
for a period of five (5) years from the date of their election until their successors shall have been duly
elected and qualified; provided that they remain members of the UNION in good standing.52

Section 6, Article II of the CBA of petitioner Union and respondent defines the position of shop
steward, thus:

SECTION 6. Shop Stewards. The UNION shall certify a total of eight (8) shop stewards and shall
inform management of the distribution of these stewards among the departments concerned. 1avvphi1.net

Shop Stewards, union officers and members or employees shall not lose pay for attending Union-
Management Labor dialogues, investigations and grievance meetings with management.53

Section 6, Rule XIX of the Implementing Rules of Book V of the Labor Code mentions the functions
and duties of shop stewards, as follows:

Section 2. Procedures in handling grievances. – In the absence of a specific provision in the

collective bargaining agreement prescribing for the procedures in handling grievance, the following
shall apply:

(a) An employee shall present this grievance or complaint orally or in writing to the shop
steward. Upon receipt thereof, the shop steward shall verify the facts and determine whether
or not the grievance is valid.

(b) If the grievance is valid, the shop steward shall immediately bring the complaint to the
employee’s immediate supervisor. The shop steward, the employee and his immediate
supervisor shall exert efforts to settle the grievance at their level.

(c) If no settlement is reached, the grievance shall be referred to the grievance committee
which shall have ten (10) days to decide the case.

Where the issue involves or arises from the interpretation or implementation of a provision in the
collective bargaining agreement, or from any order, memorandum, circular or assignment issued by
the appropriate authority in the establishment, and such issue cannot be resolved at the level of the
shop steward or the supervisor, the same may be referred immediately to the grievance committee.

All grievance unsettled or unresolved within seven (7) calendar days from the date of its submission
to the last step in the grievance machinery shall automatically be referred to a voluntary arbitrator
chosen in accordance with the provisions of the collective bargaining agreement, or in the absence
of such provisions, by mutual agreement of the parties.54

Thus, a shop steward is appointed by the Union in a shop, department, or plant serves as
representative of the Union, charged with negotiating and adjustment of grievances of employees
with the supervisor of the employer.55 He is the representative of the Union members in a building or
other workplace. Black’s Law Dictionary defines a shop steward as a union official who represents
members in a particular department. His duties include the conduct of initial negotiations for
settlement of grievances.56 He
is to help other members when they have concerns with the employer or other work-related issues.
He is the first person that workers turn to for assistance or information. If someone has a problem at
work, the steward will help them sort it out or, if necessary, help them file a complaint. 57 In the
performance of his duties, he has to take cognizance of and resolve, in the first instance, the
grievances of the members of the Union. He is empowered to decide for himself whether the
grievance or complaint of a member of the petitioner Union is valid, and if valid, to resolve the same
with the supervisor failing which, the matter would be elevated to the Grievance Committee.

It is quite clear that the jurisdiction of shop stewards and the supervisors includes the determination
of the issues arising from the interpretation or even implementation of a provision of the CBA, or
from any order or memorandum, circular or assignments issued by the appropriate authority in the
establishment. In fine, they are part and parcel of the continuous process of grievance resolution
1awphi1.net

designed to preserve and maintain peace among the employees and their employer. They occupy
positions of trust and laden with awesome responsibilities.

In this case, instead of playing the role of "peacemakers" and grievance solvers, the petitioners-shop
stewards participated in the strike. Thus, like the officers and directors of petitioner Union who joined
the strike, petitioners-shop stewards also deserve the penalty of dismissal from their employment.

IN LIGHT OF ALL THE FOREGOING, the petition is DENIED for lack of merit. The Decision of the
Court of Appeals is AFFIRMED. No costs.

SO ORDERED.
Picketing and Libel Laws
Philippine Commercial and Industrial Bank v. Philnabank Employees Association, 105
SCRA 314 (1981)

There is a unique aspect to this action for libel against the Philippine
National Bank Employees' Association. 1 It was filed by plaintiff
Philippine Commercial and Industrial Bank as a result of placards
and signboards along the Philippine National Bank building in
Escolta, Manila, containing the following: "PCIB BAD ACCOUNTS
TRANSFERRED TO PNB-NIDC?" Plaintiff considered the above
"defamatory and libelous per se for at the very least [it] amounts to
an "act tending to cause dishonor, discredit, or contempt of a
juridical person." 2 The allegation of its being libelous was denied by
defendants on the ground that such placards "containing the alleged
writing were displayed during the strike on April 3 and April 4,1967
as a fair, legal labor strategy denouncing the lack of business
foresight, incompetence, mismanagement, arbitrary and despotic
acts of the Management to heed the legal and legitimate demands
of the defendants, as a striking union, and against whom a strike
was declared against the management of the Philippine National
Bank" 3 and that moreover, "defendants, during the strike on April 3
to April 4, 1967, against the management of the Philippine National
Bank, were only moved by good intention and justifiable motives
and did not intend to injure any party not connected with the
strike;" 4 constituting part "of their legal and fair labor strategy to
enforce their demands" and to bolster their imputation of
incompetence and arbitrariness of the Philippine National Bank
management. 5 The lower court sustained such a defense and
dismissed the complaint. Hence this appeal. chan roble svirtualawl ibra rycha nrob les vi rtua l law lib rary

The decision of the then Judge Conrado Vasquez was to dismiss the
complaint. He could not discern any libelous imputation in the
alleged offending words. Such a ruling finds additional support in
the sympathetic approach followed by courts to inaccuracies and
imprecision in language in the use of placards as part of peaceful
picketing in labor controversies. chanroble svirtualawl ibra ryc hanro bles vi rt ual law li bra ry

The facts as found by the lower court, admitted by plaintiff-

appellant as correct, follow: "On April 3, 1967, defendant
Philnabank Employees' Association (PEMA), a labor organization
composed of the rank and file employees of the Philippine National
Bank, declared a strike. During the said strike, which lasted up to
the following day, members of the (PEMA) paraded and displayed
placards in front of the PNB building at Escolta, Manila, one of which
contained the following words: "PCIB BAD ACCOUNTS
TRANSFERRED TO PNB-NIDC?" It is an admitted fact that PCIB
stands for plaintiff Philippine Commercial and Industrial Bank, while
PNB refers to Philippine National Bank, and NIDC stands for National
Investment Development Corporation, a subsidiary of the PNB." 6 To
prove its claim for the recovery of damages both actual and
exemplary, as well as for attorney's fees, plaintiff-appellant, as
noted in the appealed decision, contended "that the writing on the
placard in question is a baseless and malicious aspersion that the
plaintiff was a party to a fraud, in that it was able to recoup on bad
debts or other uncollected accounts by fraudulent, questionable and
immoral transfer thereof to the PNB or NIDC. 7 Malice was likewise
at- tributed to defendant labor union and its officers. Then the
decision went on to state: "Plaintiff presented evidence to show that
it is the largest 100% Filipino commercial bank in the Philippines;
that at the time of the filing of the complaint, it had twenty-seven
(27) branches all over the country and with foreign correspondent
banks throughout the world; that the assets of the plaintiff
amounted to P333,417,445.05 and it handles a quarterly volume of
business amounting to P110,000,000.00; that it has several big
companies among its clients; and that it has a reputation for
honesty, reliability and trustworthiness, and has enjoyed domestic
and international prominence and goodwill." 8 On that point, the
lower court ruled: "The plaintiff has also miserably failed to prove
any damage caused to it by the supposed libelous placard subject
matter of this action. Plaintiff has admitted that its twenty-seven
branches at the time of the filing of the complaint (May 6, 1967)
increased to twenty-nine branches in August of 1967. The
defendants have shown that the number further increased to thirty-
three branches as of September, 1967. Plaintiff's networth likewise
increased from P46,000,000.00 in March, 1967 to P53,000,000.00
in August, 1967. Although plaintiff's witness Jovino Valenzuela
testified that. after the display of the questioned placard, the
deposits of the plaintiff bank decreased, no record was presented to
sustain this claim, which is even inconsistent with the admission of
the same witness that the Bank's networth increased since that time
and has continued to increase up to the time he testified. The same
thing is true with the testimony of plaintiff's witness Edmundo
Ledesma to the effect that due to the placard in question his
confidence in the plaintiff was shaken, thereby causing him to
deposit P50,000.00 with other banks instead of with the PCIB. He
admmitted moreover that, as an exporter, it was safer to be
opening accounts in several banks instead of in only one." 9 chanrobles vi rtual law lib rary

As noted earlier, the decision must be affirmed. chanrob lesvi rtua lawlib rary chan roble s virtual law l ibra ry

1. The brief presented by the San Juan, Africa, Gonzales and San
Agustin Law Offices is noted for its exhaustive and scholarly
discussion of the law on libel relying on both the Philippine and
American authorities. If the matter were viewed solely from what
appeared in the placard, there is an element of plausibility in the
assertion that while it was aimed at the Philippine National Bank,
the way it was worded could reflect on a stranger to the
controversy, plaintiff Philippine Commercial and Industrial Bank. It
is understandable if there were an affront to the sensibilities of its
officials, They were right to guard its reputation earned after many
years of laudable and creditable performance in the field of banking.
It is, however, precisely because of its well-deserved reputation that
what could at first glance be for the most fastidious hurtful to its
prestige could, if viewed with calmness and objectivity, be
considered, as it was characterized in the appealed decision, as
lacking in "libelous imputation. "
chanroble s virtual law lib rary

2. There is, as already indicated, another reinforcement to such a

mode of appraising the matter. There was a labor controversy
resulting in a strike, fortunately lasting only for one day. The labor
union made use of its constitutional right to picket. From the time of
Mortera v. Court of Industrial Relations, a 1947 decision, 10 this
Court has been committed to the view that peaceful picketing is
part of the freedom of speech guarantee of the Constitution. The
latest case in point where such a principle was reaffirmed expressly
is Associated Labor Union v. Gomez, 11 a 1980 decision. There is no
mention of the other placards but it is not unlikely that to bolster its
claim, mention was likewise made and in bold letters at that of such
alleged failing of its management. That was the aim and intent as
found by the lower court. That could not very well be disputed by
plaintiff-appellant. Unfortunately, the offending imputation, but in
the form of a question, was included. It was due to a former official
of plaintiff-appellant's bank who was thereafter named as President
of the Philippine National Bank. Should there be an automatic
attitude of condemnation for such incident? If the realistic
observation of Justice Frankfurter in Milk Wagon Drivers Union of
Chicago v. Meadowmoor Dairies 12 be heeded that labor disputes
give rise to strong emotional response, then the decision reached by
the lower court becomes even more acceptable. It is a fact of
industrial life, both in the Philippines as in the United States, that in
the continuing confrontation between labor and management, it is
far from likely that the language employed would be both courteous
and polite. Such being the case. there is no affront either to reason
or to the law in the complaint for libel being dismissed. In pricing
reliance on the constitutional right of freedom of expression, 13 this
Court once again makes manifest its adherence to the principle first
announced by Justice Malcolm as ponente in the leading case
of United States v. Bustos. 14 In no uncertain terms, it made clear
that the judiciary, in deciding suits for libel, must ascertain whether
or not the alleged offending words may be embraced by the
guarantees of free speech and free press. It cannot he too often
said that Bustos was promulgated as far back as March 8, 1918. A
doctrine analogous in character was enunciated by the United
States Supreme Court only thirty-six years later in New York Times
Co. v. Sullivan. 15
chanroble s virtual law l ib rary

WHEREFORE, the appealed decision is affirmed. No costs.

Curtailment

G.R. No. L-64336 August 3l, 1983

NAGKAHIUSANG MANGGAGAWA SA CUISON HOTEL-NATIONAL FEDERATION OF

LABOR (NMCHNFL)petitioner,
vs.
THE HONORABLE LABOR ARBITER JOSE O. LIBRON, respondents .

Jose C. Espinas, for petitioner..

Militar & Associates for private respondent.

FERNANDO, C.J.:

The principal basis of this certiorari proceeding filed on June 25, 1983 arose from a
clarificatory order of respondent labor arbiter in response to a motion of private respondent
"seeking to be informed as to the full meaning and legal consequences resulting from the
declaration of a strike as illegal such as what is embodied" 1in his decision dated June 10,
1983. Its disposition portion reads: "[Wherefore, premises considered], the strike staged on
April 15, 1983 should be, as it is hereby, declared illegal, and, therefore, the respondent
union and its members are permanently enjoined from staging such illegal strike; ordering
and declaring, pursuant to Article 265, par. (a) of the Labor Code, as amended, all the union
officers led by Carlito Eleazar, Marciano Macaraya and Cesar Yap to have lost their
employment status for participating in an illegal strike and committing unlawful acts during
the strike; and ordering the respondent union to pay the petitioner the amount of Pesos
Three Hundred Thirty Nine Thousand (P339,000.00), representing losses in income
suffered during the illegal strike in the concept of actual damage. 2 The clarificatory order
continues: "The consequences resulting from the declaration of a strike as illegal, which is
final and immediately executory, carries with it sanctions on the immediate incidents thereto
such as picketing, obstruction of ingress and egress, the banners and streamers being hung
in the premises and make shifts built within the immediate vicinity of the establishment
struck. Once the strikers are permanently enjoined from staging the illegal strike, the
picketing staged should also be simultaneously lifted, the obstruction of ingress and egress
removed and the make shifts taken out. In other words, the injunction of the illegal strike
and the incidents thereto is self-executing and it behooves upon the party concerned to
seek, if necessary, the assistance of the law enforcers to enforce the same. 3 Its last
paragraph reads: "The other matters in the aforequoted dispositive portion of our decision,
that of termination of the employment status of union officers and the award of damages,
are also final and executory, unless appealed to the Conunission within the reglementary
period. 4 Hence this petition.

Three days later, on June 28, 1983, this Court issued a resolution of the following tenor:
"The Court after considering the pleadings filed and deliberating on the issues raised in this
petition for certiorari with prayer for a temporary restraining order filed on June 25, 1983,
Resolved to require the respondents to file an [Answer], not a motion to dismiss, within ten
(10) days from notice. The Court further Resolved to [issue] a [Temporary Restraining
Order] enjoining respondent Labor Arbiter or any person or persons acting for and in his
behalf from proceeding with the execution and/or enforcement of his questioned decision
dated June 13, 1983 as well as his orders dated June 15 and 17, 1983 in Case No. NLRC
1121-LRXI- 83, effective immediately and until further orders from his Court. 5

The above restraining order had to be issued because as contended in the petition, the
order of the labor arbiter certainly cannot be declared final and executory upon the mere
issuance thereof. That is manifestly in contravention of the law. Article 223 of the Labor
Code is quite explicit on the matter, a period of 10 days being granted either or both to the
parties involved from receipt of any order to appeal to the National Labor Relations
Commission. 6

Moreover, the wholesale condemnation of peaceful picketing is likewise clearly bereft of

support in law. As pointed out in a very recent decision decided this year, Phil. Assn. of
Free Labor Unions (PAFLU) v. CFI of Rizal. 7 It need not be stressed that peaceful picketing
is embraced in freedom of expression. As emphatically declared in Philippine Commercial &
Industrial Bank v. Philnabank Employees' Association: 'From the time of Mortera v. Court of
Industrial Relations, a 1947 decision this Court has been committed to the view that
peaceful picketing is part of the freedom of speech guarantee of the Constitution.'
Reference was made in such opinion to Associated Labor Union v. Gomez. In that case, the
Court characterized the orders complained of as being 'fatally defective, suffering as it did
from the infirmity that peaceful picketing was enjoined.' It is in that sense that Presidential
Decree No. 849 was a step in the right direction for the status of picketing was again
accorded due recognition. 8

In the answer, reference was made to the alleged commission of acts of violence against
non-striking employees and even against the eight-year old "sickly and paralytic
President 9 of respondent. It is to be understood, of course, that the peaceful picketing
authorized cannot countenance acts of illegality. The interim Batasang Pambansa has
spoken on the subject thus: "(e) No person engaged in picketing shall commit any act of
violence, coercion or intimidation or obstruct the free ingress to or egress from the
employer's premises for lawful purposes, or obstruct public thoroughfares." 10

At any rate, the case needs no further discussion as on August 17, 1983, the following
manifestation and motion to dismiss was filed by petitioner through counsel- "1. The labor
dispute between the parties which resulted in the present cm has been settled on August
15, 1983, and the workers are back to their work. 2. In view thereof, the above-entitled can
has become moot and academic. " 11

WHEREFORE, the case is dismissed for being moot and academic.

Regulation/Restrictions, Innocent Third Party Rule and Liabilities

G.R. No. L-25003 October 23, 1981

LIWAYWAY PUBLICATIONS, INC., plaintiff-appellee,
vs.
PERMANENT CONCRETE WORKERS UNION, Affiliated with the NATIONAL ASSOCIATION OF
TRADE UNIONS, HERMOGENES ATRAZO, AQUILINO DISTOR, BENJAMIN GUTIERREZ, JOSE
RAMOS, TIBURCIO MARDO, ERNESTO ALMARIO and DOMINGO LEANO, defendants-
appellants.

GUERRERO, J.:

This is an appeal from the decision of the Court of First Instance of Manila declaring permanent the
writ of preliminary injunction issued in this case and condemning the defendants (herein appellants)
to pay plaintiff (herein appellee), the amount of P10,152.42 with interest thereon at the legal rate
from the commencement of this action until fully paid, P1,000.00 as attorney's fees and costs.

The case commenced when Liwayway Publications, Inc. brought an action in the CFI-Manila against
Permanent Concrete Workers Union, et al. for the issuance of a writ of preliminary injunction and for
damages it incurred when its employees were prevented from getting their daily supply of newsprint
from its bodega.

Plaintiff alleged that it is a second sublessee of a part of the premises of the Permanent Concrete
Products, Inc. at 1000 Cordeleria Street, Sta. Mesa, Manila from Don Ramon Roces, a first lessee
from the aforesaid company. The premises of the plaintiff is separated from the compound of
Permanent Concrete Products, Inc. by a concrete and barbed wire fence with its own entrance and
road leading to the national road. This entrance is separate and distinct from the entrance road of
the Permanent Concrete Products, Inc. 1

Plaintiff further alleged that it has a bodega for its newsprint in the sublet property which it uses for
its printing and publishing business. The daily supply of newsprint needed to feed its printing plant is
taken from this bodega.

On September 10, 1964, the employees of the Permanent Concrete Products, Inc. who are
representatives and members of the defendant union declared a strike against their company.

On October 3, 1964 for unknown reasons and without legal justification, Permanent Concrete
Workers Union and its members picketed, stopped and prohibited plaintiff's truck from entering the
compound to load newsprint from its bodega. The union members intimidated and threatened with
bodily harm the employees who were in the truck.

On October 6, 1964, union members stopped and prohibited the general manager, personnel
manager, bodega-in-charge and other employees of the plaintiff from getting newsprint in their
bodega. 2

Plaintiff made repeated demands to the defendants not to intimidate and threaten its employees with
bodily harm and not to blockade, picket or prohibit plaintiff's truck from getting newsprint in their
bodega. Defendants refused and continued to refuse to give in to the demands of the plaintiff.

As a consequence thereof, plaintiff rented another bodega during the time members of the
defendant union prevented its employees from entering its bodega in the compound of Permanent
Concrete Products, Inc. and thus incurred expenses both in terms of bodega rentals and in
transporting newsprint from the pier to the temporary bodega.

On December 14, 1964, the lower court issued a writ of preliminary injunction enjoining the
defendants from:

(a) threatening and intimidating plaintiff's executive officers and their representatives, who are going
to its bodega as well as its employees who are getting newsprint from it;

(b) ordering the defendants and their representatives not to blockade and/or picket the compound
and the gate of the plaintiff;

(c) ordering the defendants not to stop, prohibit, molest and interfere with the free passage of the
plaintiff in going in and out of the bodega.

Defendant union moved to dismiss the complaint on the following grounds:

1. That this case arose out of a labor dispute involving unfair labor practices and, therefore, the
Court of First Instance where this action was brought has no jurisdiction to issue an injunction since
this case fans within the exclusive jurisdiction of the Court of Industrial Relations;

2. That plaintiff is not the real party in interest in whose name the present action may be prosecuted
in accordance with Section 2, Rule 3 of the Rules of Court.

On the first ground, defendants argued that the Court of Industrial Relations is vested with the
exclusive power to issue injunctions in labor disputes involving unfair labor practices and that in the
long line of decisions, the Supreme Court hat, repeatedly held that ordinary do not have jurisdiction
to issue an injunction in any labor dispute particularly when the Court of Industrial Relations has
already acquired jurisdiction over it.

As to the second ground, defendants argue that the real party in interest in this case is the
Permanent Concrete Products, Inc. against whom the defendants' strike and picket activities were
directed and confined, and they point to cases between the real parties in interest, namely:
Permanent Concrete products, Inc. on one hand and the Permanent Concrete Workers Union on the
other, pending before the Court of Industrial Relations docketed therein as CIR Case No. 156-Inj.,
Charge 212-ULP and Charge No. 1414-M.C.

Plaintiff Liwayway Publications, Inc. opposed the motion, alleging that:

1. There is no employer-employee relationship between the plaintiff and the defendant;

2. There is no labor dispute between them;

3. Plaintiff's compound is separate and distinct from the compound of the company where the
defendant's are employed.

Defendants by way of reply to the abovementioned opposition argued that even if there was no
employer-employee relationship, still the Court of First Instance would have no jurisdiction to issue
an injunction, citing several cases holding that there could be a labor dispute regardless of whether
or not the disputants stand in proximate relation of employer and employee and that peaceful
picketing is an extension of the freedom of speech guaranteed by the Constitution, 3 a fundamental
right granted to labor which cannot be enjoined.

Since plaintiff averred in its complaint that "it is a second sublessee of a part of the premises of the
Permanent Concrete Products, Inc. at 1000 Cordeleria Street, Sta. Mesa, Manila from Don Ramon
Roces, first lessee from the aforementioned company, defendants contend that plaintiff has no
cause of action against them but against Don Ramon Roces under the provisions of Article 1654 of
the New Civil Code which obliges the lessor to maintain the lessee in the peaceful and adequate
enjoyment of the lease for the entire duration of the contract.

On October 22, 1964, the lower court issued an order denying the motion to dismiss and motion to
dissolve the writ of preliminary injunction on the ground that there was no labor dispute between the
plaintiff and defendant of which the Court of Industrial Relations may take cognizance.

On November 16, 1964, the court, on motion of the plaintiff, declared defendants in default.
Defendants prayed for the lifting of the order of default, which plaintiff opposed. In the order of
December 16, 1964, the court denied the motion to lift the order of default, and subsequently
defendants' motion for reconsideration. Thereafter, the court rendered its decision dated February
16, 1965 which declared permanent the writ of preliminary injunction and ordered the defendants to
pay the plaintiff jointly and severally the amount of ?10,152.42 with interest thereon at legal rate from
the commencement of the action until fully paid, Pl,000.00 as attorney's fees and the costs. Copy of
this decision was received by defendants on July 20, 1965 and forthwith, defendants filed the notice
of appeal on July 26, 1965.

On October 12,1965, Liwayway Publications, Inc. filed with the Supreme Court a petition praying that
a writ of attachment be issued on any sum of money which is owing from the company to the union
and to other defendants to be used to satisfy the judgment in its favor should the same be affirmed
by the Supreme Court.

Defendants filed an opposition to the petition for attachment alleging that even assuming that there
is an amount owing to the union from the company, such would be in the concept of uncollected
wages due the strikers and, therefore, cannot be subject of attachment as provided by Art. 1708 of
the New Civil Code that the laborer's wages shall not be subject to execution or attachment except
for debts incurred for food, shelter, clothing and for medical attendance.

The Supreme Court denied the above petition for attachment but without prejudice to the movant
seeking remedy in the Court of First Instance.

The sole issue raised in the instant appeal is whether or not the lower court has jurisdiction to issue
a writ of preliminary injunction considering that there was a labor dispute between Permanent
Concrete Products, Inc. and appellants for alleged unfair labor practices committed by the former.

The first question that strikes Us to be of determinative significance is whether or not this case
involves or has arisen out of a labor dispute. If it does, then with certainty, section 9 of Republic Act
875, the "Industrial Peace Act", would apply. If it does not, then the Rules of Court will govern the
issuance of the writ of preliminary injunction because it will not partake the nature of a labor
injunction which the lower court has no jurisdiction to issue.

The record before Us reveals that appellant union and its members picketed the gate leading to
appellee's bodega. This gate is about 200 meters from the gate leading to the premises of the
employer of the appellants. Appellee is not in any way related to the striking union except for the fact
that it is the sublessee of a bodega in the company's compound. The picketers belonging to the
appellant union had stopped and prohibited the truck of the appellee from entering the compound to
load newsprint from its bodega, the union members intimidating and threatening with bodily harm the
employees of the appellee who were in the truck. The union members also stopped and prohibited
the general manager, personnel manager including the man in-charge of the bodega and other
employees of the Liwayway Publications, Inc. from getting newsprint in said bodega. The business
of the appellee is exclusively the publication of the magazines Bannawag Bisaya, Hiligaynon and
Liwayway weekly magazines which has absolutely no relation or connection whatsoever with the
cause of the strike of the union against their company, much less with the terms, conditions or
demands of the strikers. In such a factual situation, the query to be resolved is whether the appellee
is a third party or an "innocent bystander" whose right has been invaded and, therefore, entitled to
protection by the regular courts.

At this juncture it is well to cite and stress the pronouncements of the Supreme Court on the right to
picket. Thus, in the case of Phil. Association of Free Labor Unions (PAFLU) vs. Judge Gaudencio
Cloribel et al., L-25878, March 28, 1969, 27 SCRA 465, 472, the Supreme Court, speaking thru
Justice J.B.L. Reyes, said:

The right to picket as a means of communicating the facts of a labor dispute is a

phrase of the freedom of speech guaranteed by the constitution. If peacefully carried
out, it cannot be curtailed even in the absence of employer-employee relationship.

The right is, however, not an absolute one. While peaceful picketing is entitled to
protection as an exercise of free speech, we believe that courts are not without
power to confine or localize the sphere of communication or the demonstration to the
parties to the labor dispute, including those with related interest, and to insulate
establishments or persons with no industrial connection or having interest totally
foreign to the context of the dispute. Thus, the right may be regulated at the instance
of third parties or "innocent. bystanders" if it appears that the inevitable result of its
exercise is to create an impression that a labor dispute with which they have no
connection or interest exists between them and the picketing union or constitute an
invasion of their rights. In one case decided by this Court, we upheld a trial court's
injunction prohibiting the union from blocking the entrance to a feed mill located
within the compound of a flour mill with which the union had a dispute. Although
sustained on a different ground, no connection was found other than their being
situated in the same premises. It is to be noted that in the instances cited, peaceful
picketing has not been totally banned but merely regulated. And in one American
case, a picket by a labor union in front of a motion picture theater with which the
union had a labor dispute was enjoined by the court from being extended in front of
the main entrance of the building housing the theater wherein other stores operated
by third persons were located.

The same case state clearly and succinctly the rationalization for the court's regulation of the right to
picket in the following wise and manner:

Wellington and Galang are mere 'innocent bystanders'. They are entitled to seek
protection of their rights from the courts and the courts may, accordingly, legally
extend the same. Moreover, PAFLU's right to peacefully picket METBANK is not
curtailed by the injunctions issued by respondent judge. The picket is merely
regulated to protect the rights of third parties. And the reason for this is not far-
fetched. If the law fails to afford said protection, men will endeavor to safeguard their
rights by their own might, take the law in their own hands, and commit acts which
lead to breaches of the law. 'This should not be allowed to happen.
It may be conceded that the appellant Union has a labor dispute with the Permanent Concrete
Products company and that the dispute is pending before the Court of Industrial Relations docket
therein as CIR Case No. 156-Inj., Charge 212-ULP and Charge No. 1414-M.C. Nonetheless, the rule
laid down in the case of National Garment and Textile Workers' Union (PAFLU) vs. Hon.
Hermogenes Caluag, et al. G.R. No. L-9104, September 10, 1956, cited by the appellants as
authority holding that "where the Court of Industrial Relations has already acquired jurisdiction over
two unfair labor practices cases and much later on as a consequence thereof, the Court of First
Instance cannot legally issue a writ of preliminary injunction against the picketers. Besides, the
jurisdiction of the Court of Industrial Relations is exclusive. (Sec. 5-a, Republic Act 875)" is not
controlling, much less applicable to the instant case where the facts are essentially and materially
different.

Neither is the case of SMB Box factory Workers' Union vs. Hon. Gustavo Victoriano, et al. G.R. No.
L-12820, Dec. 29, 1957, where We held that "the Court of First Instance cannot take cognizance of
an action for injunction where the issue involved is interwoven with unfair labor practice cases
pending in the Court of Industrial Relations," nor the rule laid down in Erlanger & Galinger, Inc. vs.
Erlanger & Galinger Employees Association-NATU, G.R. No. L-11907, June 24, 1958,104 Phil. 17,
holding that "even if no unfair labor practice suit has been filed at all by any of the parties in the
Court of Industrial Relations at the time the present petition for injunction was filed in the court
below, still the latter court would have no jurisdiction to issue the temporary restraining order prayed
for if it is shown to its satisfaction that the labor dispute arose out of unfair labor practices committed
by any of the parties. The parties would still have to institute the proper action in the Court of
Industrial Relations, and there ask for a temporary restraining order under sec. 9 (d) of the Industrial
peace Act. "

We cannot agree that the above rules cited by the appellants are controlling in the instant case for
as We said in Phil. Association of Free Labor Unions (PAFLU), et at. vs. Tan, 99 Phil. 854, that "with
regard to activities that may be enjoined, in order to ascertain what court has jurisdiction to issue the
injunction, it is necessary to determine the nature of the controversy, " (emphasis supplied) We find
and hold that there is no connection between the appellee Liwayway publications, Inc. and the
striking Union, nor with the company against whom the strikers staged the strike, and neither are the
acts of the driver of the appellee, its general manager, personnel manager, the man in-charge of the
bodega and other employees of the appellee in reaching the bodega to obtain newsprint therefrom
to feed and supply its publishing business interwoven with the labor dispute between the striking
Union and the Permanent Concrete Products company. If there is a connection between appellee
publishing company and the Permanent Concrete Products company; it is that both are situated in
the same premises, which can hardly be considered as interwoven with the labor dispute pending in
the Court of Industrial Relations between the strikers and their employer.

The contention of appellants that the court erred in denying their motion to dismiss on the ground
that the complaint states no cause of action, is likewise without merit.

Article 1654 of the New Civil Code cited by the appellants in support of their motion to dismiss, which
obliges the lessor, among others, to maintain the lessee in the peaceful and adequate enjoyment of
the lease for the entire duration of the contract, and therefore, the appellee publishing company
should have brought its complaint against the first sub-lessee, Don Ramon Roces, and not against
the appellant Union is not in point. The acts complained of against the striking union members are
properly called mere acts of trespass (perturbacion de mero hecho) such that following the doctrine
laid down in Goldstein vs. Roces, 34 Phil. 562, the lessor shall not be obliged to answer for the mere
fact of a trespass (perturbacion de mero hecho) made by a third person in the use of the estate
leased but the lessee shag have a direct action against the trespasser. The instant case fags
squarely under the provisions of Article 1664 of the New Civil Code which provides as follows:
 Art. 1664. The lessor is not obliged to answer for a mere act of trespass which a third
person may cause on the use of the thing leased; but the lessee shall have a direct
action against the intruder.

There is a mere act of trespass when the third person claims no right whatever.

The Goldstein doctrine had been reiterated in Reyes vs. Caltex (Phil). Inc., 84 Phil. 654; Lo Ching, et
al. vs. Court of Appeals, et al. 81 Phil. 601; Afesa vs. Ayala y Cia 89 Phil. 292; Vda. de Villaruel et al.
vs. Manila Motor Co., Inc., et al. 104 Phil. 926; Heirs of B.A. Crumb, et al. vs. Rodriguez, 105 Phil.
391.

The obligation of the lessor under Art. 1654, New Civil Code, to maintain the lessee in the peaceful
and adequate enjoyment of the lease for the entire duration of the contract arises only when acts,
termed as legal trespass (perturbacion de derecho), disturb, dispute, object to, or place difficulties in
the way of the lessee's peaceful enjoyment of the premises that in some manner or other cast doubt
upon the right of the lessor by virtue of which the lessor himself executed the lease, in which case
the lessor is obliged to answer for said act of trespass.

The difference between simple trespass (perturbacion de mero hecho and legal trespass
(perturbacion de derecho) is simply but - clearly stated in Goldstein vs. Roces case, supra, thus:

Briefly, if the act of trespass is not accompanied or preceded by anything which

reveals a really juridic intention on the part of the trespasser, in such wise that the
lessee can only distinguish the material fact, stripped of all legal form or reasons, we
understand it to be trespass in fact only (de mero hecho). (pp. 566-567)

WHEREFORE, IN VIEW OF THE FOREGOING, the decision appealed from is hereby AFFIRMED in
toto. Costs against appellants.

SO ORDERED.

Prohibited Activities; Peaceful Picketing, Art. 279 (b); Book V, Rule XXII, Sec. 13