1 Employees Union of Bayer Philippines (“Union”),
FFW (Federation affiliated with Union) v. Bayer
Philippines, Inc., et. al. (“Company”)
GR No. 162943, December 6, 2010, de Guia | Unfair
Labor Practice
Doctrine/s:
It must be remembered that a CBA is entered into in order
to foster stability and mutual cooperation between labor
and capital. An employer should not be allowed to rescind
unilaterally its CBA with the duly certified bargaining agent
it had previously contracted with, and decide to bargain
anew with a different group if there is no legitimate reason
for doing so and without first following the proper
procedure.
ART. 253. Duty to bargain collectively when there exists a
collective bargaining agreement. — Where there is a
collective bargaining agreement, the duty to bargain
collectively shall also mean that neither party shall
terminate or modify such agreement during its lifetime…
This is the reason why it is axiomatic in labor relations that
a CBA entered into by a legitimate labor organization that
has been duly certified as the exclusive bargaining
representative and the employer becomes the law
between them. Additionally, in the Certificate of
Registration issued by the DOLE, it is specified that the
registered CBA serves as the covenant between the
parties and has the force and effect of law between them
during the period of its duration. Compliance with the
terms and conditions of the CBA is mandated by express
policy of the law primarily to afford protection to labor and
to promote industrial peace. Thus, when a valid and
binding CBA had been entered into by the workers
and the employer, the latter is behooved to observe
the terms and conditions thereof bearing on union
dues and representation. If the employer grossly violates
its CBA with the duly recognized union, the former may be
held administratively and criminally liable for unfair labor
practice.
Summary (this case has a mountain of facts, so a
summary is necessary): Dissenters organized a union
inside the main union, garnering support from majority of
the union members. Company supported the dissenters by
negotiating with them and giving them the union dues.
Despite the main union’s demands for compliance with its
CBA with the union SC said that the company is guilty of
Unfair Labor Practice; it should have respected the CBA
with the main union.
Facts:
1. Union is the exclusive bargaining agent of rank
and file employees of Company; it is also an
affiliate of the Federation of Free Workers
(“Federation”)
2. Union is headed by its president, Juanito S.
Facundo (“U President”)
3. Company is headed by its president, Dieter J.
Lonishen (“C President”), and its Human
Resources Development Manager Asuncion
Amistoso (“HR Manager”)
4. This is not explicitly stated in the facts, but it’s
implied (and I can say this with absolute
confidence, because it’s been referenced in the
decision) that Union and Company had a CBA
before the occurrence of the controversy
5. Company offered a 9.9% increase in wages, but
Union refused, thus resulting in a bargaining
deadlock
6. Union staged a strike, prompting DOLE Secretary
to assume jurisdiction over the dispute
7. A certain Avelina Remigio (“Dissenter”) and 27
other union members, without any authority from
Union’s leaders, accepted the 9.9% increase
8. Union’s grievance committee questioned
Dissenter’s action and reprimanded Dissenter
and her allies
9. DOLE Secretary issued an arbitral award
ordering Union and Company to execute a CBA
retroactive to 1 January 1997, effective until 31
December 2001 (“1997-2001 CBA”)
10. CBA was registered on 8 July 1998 with the
Industrial Relations Division of DOLE NCR
11. Note that, it would seem that this CBA was
entered into by Union (not Union X) and
Company
12. Meanwhile, Dissenter solicited signatures from
union members in support of a resolution to:
a. Disaffiliate from Federation
b. Rename the union as Reformed
Employees Union of Bayer Philippines
(“Union X”)
c. Adopt a new constitution and by-laws
d. Abolish all existing officers
e. Elect a new set of interim officers
f. Authorize Union X to administer the
CBA between Union and Bayer
13. Such resolution was signed by 147 out of 257
local union members
14. A subsequent resolution was also issued
affirming the first resolution
15. Union X wrote U President, Federation, and,
Company essentially iterating the decision of
majority of the union members in the resolution
(in no. 9), for the remittance of all union dues to
Union X and, for the Company to stop from
further transacting with Union
16. Union X also said that a set of interim officers had
already been elected
17. Meanwhile, U President wrote Company
requesting for the remittance of union dues in
favor of Union and accused Company of
interfering with purely union matters
18. Company responded by deciding not to deal with
either of the two groups and placing the union
dues in a trust account until the conflict between
them is resolved
19. Union filed a complaint for Unfair Labor Practice
(“1st ULP case”) against Company for non-
remittance of union dues
20. During its pendency, Union sent a letter to
Company for a grievance conference to discuss
Company’s failure to comply with the terms of the
CBA, and the same occurred, but no resolution
was reached; Union again sent two more letters
for another grievance conference, but the same
went unheeded
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 21. Company also turned over collected union dues
of P254,857.15 to Union X, via Anastacia
Villareal, Union X’s Treasurer (“X Treasurer”).
22. Union lodged a complaint before DOLE Industrial
Relations Division seeking Union X’s members’
expulsion from Union for commission of “acts that
threaten the life of the union” (“expulsion
complaint”)
23. Labor Arbiter (“LA”) dismissed 1st ULP case for
lack of jurisdiction, allegedly because it’s an intra-
union conflict. LA reasoned that Company’s
failure to collect the union dues is because of the
intra-union conflict between Union and Union X.
LA said the charges against Company should
instead be the submitted to voluntary arbitration;
Union did not appeal
24. Instead, Union filed another ULP case (“2nd ULP
case”) charging Company with ULP by organizing
a company union, gross violation of CBA, and
violation of their duty to bargain; allegedly,
Company negotiated with Union X for a new CBA
instead of Union
25. Later, Company and Union X agreed to sign a
new CBA, amending the 1997-2001 CBA
26. Union filed a TRO / Injunction suit before NLRC
and LA against Company, Dissenter, and X
Treasurer; aside from the foregoing allegations,
Union also said the negotiation with Union X and
the signing of a new CBA with them violates the
contract bar rule (“TRO suit”)
27. Meanwhile, DOLE Industrial Relations Division
Regional Director dismissed the expulsion
complaint and ordered a referendum to determine
which of the two groups should be recognized as
union officers
28. Bureau of Labor Relations reversed on appeal,
ordering Company to respect the authority of
Union officers and the administration of the
prevailing CBA (unfortunately, the decision came
after Company and Union X already signed a
new CBA)
29. 2nd ULP case was dismissed by LA for lack of
jurisdiction, being, again, an intra-union dispute;
on appeal, NLRC affirmed LA
30. TRO suit was also dismissed for the same reason
31. 2nd ULP Case was made subject of a Rule 65
(certiorari) petition before CA; CA affirmed NLRC
and LA
32. Hence, the instant petition before the Court.
Issue/s:
1. W/N Company is liable for ULP for negotiating
with Union X? – YES.
Held:
1. The ULP against Company, C President, and
HRD Manager, is not an intra-union dispute. An
intra-union dispute refers to any conflict
between and among union members, including
grievances arising from any violation of the rights
and conditions of membership, violation of or
disagreement over any provision of the union's
constitution and by-laws, or disputes arising from
chartering or disaffiliation of the union. However,
as to respondents Dissenter and X Treasurer, it
was an intra-union dispute and the complaint
against them is validly dismissed.
2. Company, C President, and HRD Manager are
liable for ULP. An employer should not be
allowed to rescind unilaterally its CBA with the
duly certified bargaining agent it had previously
contracted with, and decide to bargain anew with
a different group if there is no legitimate reason
for doing so and without first following the
proper procedure. If such behavior would be
tolerated, bargaining and negotiations between
the employer and the union will never be truthful
and meaningful, and no CBA forged after
arduous negotiations will ever be honored or be
relied upon.
3. The complaint should not be dismissed for being
supposedly moot and academic. Company
argues that it later decided to recognize Union as
the certified collective bargaining agent of its
rank-and-􀁁le employees for purposes of its later,
2006-2007 CBA negotiations.
First, a legitimate labor organization cannot be
construed to have abandoned its pending
claim against the management/employer by
returning to the negotiating table to fulfill its
duty to represent the interest of its members,
except when the pending claim has been
expressly waived or compromised in its
subsequent negotiations with the management.
Second, it did not obliterate the fact that the
management of Bayer had withdrawn its
recognition of Union and supported Union X
during the tumultuous implementation of the
1997-2001 CBA.
Petition is PARTLY GRANTED. CA decision and
resolution are MODIFIED as follows:
1. Respondents Bayer Phils., Dieter J. Lonishen
and Asuncion Amistoso are found LIABLE for
Unfair Labor Practice, and are hereby ORDERED
to remit to petitioners the amount of P254,857.15
representing the collected union dues previously
turned over to Avelina Remigio and Anastacia
Villareal. They are likewise ORDERED to pay
petitioners nominal damages in the amount of
P250,000.00 and attorney's fees equivalent to
10% of the monetary award; and
2. The complaint, as against respondents Remigio
and Villareal is DISMISSED due to the lack of
jurisdiction of the Labor Arbiter and the NLRC,
the complaint being in the nature of an intra-union
dispute.
2. PRINCE TRANSPORT, INC. v. DIOSDADO
GARCIA, et. al.
GR No. 167291; Jan 12, 2011 [DORIA]
FACTS
 Respondents were hired as either drivers,
conductors, mechanics or inspectors, except for
respondent Diosdado Garcia (Garcia), an
Operations Manager.
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  In addition to their regular monthly income, they
also received commissions equivalent to 8%-10%
of their wages. These were reduced to 7%-9%.
Thus, respondents and other employees of PTI
met to discuss the protection of their interests as
employees.
 Renato Claros, President of PTI, made known to
Garcia his objection to the formation of a union.
 In order to block the continued formation of the
union, PTI caused the transfer of all union
members and sympathizers to one of its sub-
companies, Lubas Transport (Lubas). Despite the
transfer, the schedule of bus drivers and
conductors, their company IDs were issued by
PTI. The daily time records, tickets and reports
were also filed at the PTI office; and all claims for
salaries were transacted thereto.
 Later, the business of Lubas deteriorated
because of the refusal of PTI to maintain and
repair the units being used – which resulted to
the virtual stoppage of its operations and
respondents’ loss of employment.
 Petitioners claimed that respondents were all
transferred to Lubas at their own request; and
that petitioner has nothing to do with the
management and operations of Lubas.
 LA – dismissed complaints for unfair labor
practices, but declared that complainants are
illegally dismissed. NLRC affirmed.
 CA – reversed. Guilty of unfair labor practices.
Petitioners act of transferring respondents
employment to Lubas is indicative of their intent
to frustrate the efforts of respondents to organize
themselves into a union.
ISSUE
W/N petitioners are guilty of unfair labor practices? YES.
HELD
The Court finds no cogent reason to depart from the
findings of the CA that respondents transfer of work
assignments to Lubas was designed by petitioners as a
subterfuge to foil the formers right to organize themselves
into a union. Under Article 248 (a) and (e) of the Labor
Code, an employer is guilty of unfair labor practice if it
interferes with, restrains or coerces its employees in the
exercise of their right to self-organization or if it
discriminates in regard to wages, hours of work and other
terms and conditions of employment in order to encourage
or discourage membership in any labor organization.
Indeed, evidence of petitioners' unfair labor practice is
shown by the established fact that, after respondents'
transfer to Lubas, petitioners left them high and dry insofar
as the operations of Lubas was concerned. The Court
finds no error in the findings and conclusion of the CA that
petitioners withheld the necessary financial and logistic
support such as spare parts, and repair and maintenance
of the transferred buses until only two units remained in
running condition. This left respondents virtually jobless.
Petition denied. CA decision is affirmed.
3. MANILA MINING CORP. EMPLOYEES ASSOCIATION-
FEDERATION OF FREE WORKERS CHAPTER
(UNION), SAMUEL G. ZUÑIGA (ZUNIGA)
(collectively PETITIONERS)
vs.
MANILA MINING CORP. (MMC) et al. (collectively
RESPONDENTS)
G.R. 178222-23, 29 September 2010
PEREZ, J.
ELINZANO
DOCTRINE:
For a charge of unfair labor practice to prosper, it must be
shown that the employer was motivated by ill-will, bad
faith or fraud, or was oppressive to labor. The
employer must have acted in a manner contrary to morals,
good customs, or public policy causing social humiliation,
wounded feelings or grave anxiety. While the law makes it
an obligation for the employer and the employees to
bargain collectively with each other, such compulsion does
not include the commitment to precipitately accept or
agree to the proposals of the other. All it contemplates is
that both parties should approach the negotiation with an
open mind and make reasonable effort to reach a common
ground of agreement.
FACTS: (REFER TO THE TITLE)
1. MMC is a engaged in large-scale mining for gold and
copper ore. MMC is required by law to maintain a
tailings containment facility to store the waste material
generated by its mining operations.
2. On 10 January 2000, 11 rank-and-file employees of
MMC attended the organizational meeting of the
UNION.
3. On 3 March 2000, the Union filed with the DOLE all
the requirements for its registration.
4. The Union acquired its legitimate registration status
on 30 March 2000. Subsequently, MMC conveyed its
intention to bargain collectively. Thus, the Union
submitted its CBA proposal to MMC.
5. Upon expiration of the tailings permit, MMC was
compelled by the DENR to temporarily shut down
its mining operations due to its failure to secure an
Environmental Compliance Certificate (ECC),
resulting in the temporary lay-off of more than 400
employees in the mine site.
6. On 30 July 2001, MMC called for the suspension of
negotiations on the CBA with the Union until
resumption of mining operations.
7. Then, PETITIONERS filed a complaint before the labor
arbiter praying for reinstatement, recognition of the
Union as the sole and exclusive representative of its
rank-and-file employees, and payment of moral and
exemplary damages and attorney’s fees.
8. They challenged the validity of their lay-off on the
averment:
a. That MMC was not suffering from business
losses.
b. That MMC did not want to bargain collectively
with the Union, so that instead of submitting their
counterproposal to the CBA, MMC decided to
terminate all union officers and active members.
c. That there was no showing that cost-cutting
measures were taken by MMC;
d. That no criteria were employed in choosing
which employees to lay-off;
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 e. That the individuals laid-off were those who
signed the attendance sheet of the union
organizational meeting; and
f. That they were denied due process because
they were not given a 30-day notice informing
them of the lay-off. Neither was the DOLE
informed of this lay-off, as mandated by law.
9. RESPONDENTS justified the temporary lay-off as bona
fide in character and a valid management prerogative
pending the issuance of the permit to continuously
operate TP No. 7.
10. LA: In favor of MMC. It held that the temporary
shutdown of the mining operation, as well as the
temporary lay-off of the employees, is valid.
11. NLRC: modified the judgment of the LA and ordered
the payment of separation pay. It ratiocinated that the
temporary lay-off, which exceeded more than six (6)
months, had the effect of severance of the employer-
employee relationship. The dispositive portion of the
Decision read:
12. CA: modified the NLRC ruling insofar as it holds MMC
liable to pay the Union attorney’s fees equivalent to
10% of the award, which portion of the questioned
decision is now SET ASIDE. Hence, the petitioners
brought the case before the SC.
ISSUE: Does the lay-off constitute Unfair Labor Practice?
HELD:
NO. The lay-off is neither illegal nor can it be
considered as unfair labor practice. Unfair labor practice
cannot be imputed to MMC since, as ruled by the Court of
Appeals, the call of MMC for a suspension of the CBA
negotiations cannot be equated to “refusal to bargain.”
For a charge of unfair labor practice to prosper, it
must be shown that the employer was motivated by ill-will,
bad faith or fraud, or was oppressive to labor. The
employer must have acted in a manner contrary to morals,
good customs, or public policy causing social humiliation,
wounded feelings or grave anxiety. While the law makes it
an obligation for the employer and the employees to
bargain collectively with each other, such compulsion does
not include the commitment to precipitately accept or
agree to the proposals of the other. All it contemplates is
that both parties should approach the negotiation with an
open mind and make reasonable effort to reach a common
ground of agreement.22
The Union based its contention on the letter
request by MMC for the suspension of the collective
bargaining negotiations until it resumes operations. Verily,
it cannot be said that MMC deliberately avoided the
negotiation. It merely sought a suspension and in fact,
even expressed its willingness to negotiate once the
mining operations resume. There was valid reliance on the
suspension of mining operations for the suspension, in
turn, of the CBA negotiation. The Union failed to prove bad
faith in MMC’s actuations.
DISPOSITION: PETITION DENIED.
04. CENTRAL AZUCARERA DE BAIS EMPLOYEES
UNION-NFL [CABEU-NFL], vs. CENTRAL AZUCARERA
DE BAIS, INC. [CAB],
G.R. No. 186605 November 17, 2010 || Mendoza, J.
Doctrine/s:
For a charge of unfair labor practice to prosper, it must be
shown that CAB was motivated by ill will, “bad faith, or
fraud, or was oppressive to labor, or done in a manner
contrary to morals, good customs, or public policy, and, of
course, that social humiliation, wounded feelings or grave
anxiety resulted x x x” in suspending negotiations with
CABEU-NFL.
Facts:
1. Respondent Central Azucarera De Bais, Inc. (CAB) is
a corporation duly organized and existing under the
laws of the Philippines., while CABEU-NFL is a duly
registered labor union and a certified bargaining agent
of the CAB rank-and-file employees.
2. On January 19, 2004, CABEU-NFL sent CAB a
proposed Collective Bargaining Agreement seeking
increases in the daily wage and vacation and sick
leave benefits of the monthly employees and the grant
of leave benefits and 13th month pay to seasonal
workers. CAB responded with a counter-proposal to
the effect that the production bonus incentive and
special production bonus and incentives be
maintained. In addition, respondent CAB agreed to
execute a pro-rated increase of wages every time the
government would mandate an increase in the
minimum wage. CAB, however, did not agree to grant
additional and separate Christmas bonuses.
Thereafter CAB received an Amended Union
Proposal sent by CABEU-NFL reducing its previous
demand regarding wages and bonuses. CAB,
however, maintained its position on the matter. Thus,
the collective bargaining negotiations resulted in a
deadlock.
3. On account of the impasse, CABEU-NFL filed a
Notice of Strike with the NCMB. The NCMB then
assumed conciliatory-mediation jurisdiction and
summoned the parties to conciliation conferences.
4. Later,CABEU-NFL requested copies of CAB’s annual
financial statements from 2001 to 2004 and asked for
the resumption of conciliation meetings. CAB replied,
denying the request, since the Union which Mr.
Saguran purportedly represents has already lost its
majority status by reason of the disauthorization and
withdrawal of support thereto by more than 90% of the
rank and file employees in the bargaining unit of
Central sometime in January, 2005, and the workers
themselves, acting as principal, after disauthorizing
the previous agent CABEU-NFL have organized
themselves into a new Union known as Central
Azucarera de Bais Employees Labor Association
(CABELA). CAB underscored that the request for
further conciliation conference will serve no lawful and
practical purpose.
5. It appears that the NCMB failed to act on the letter-
response of CAB. However, reacting from the letter-
response of CAB, CABEU-NFL filed a Complaint for
ULP for the former’s refusal to bargain with it.
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6. LA dismissed the complaint, saying that it cannot be
said that respondent CAB refused to negotiate or that
it violated its duty to bargain collectively in light of its
active participation in the past CBA negotiations at the
plant level as well as in the NCMB.
7. On appeal, the NLRC reversed the LA’s decision and
found CAB guilty of unfair labor practice, saying that it
is undeniable that complainant is the certified
collective bargaining agent of the regular workers and
seasonal employees of respondent. CAB moved for a
reconsideration but the motion was denied by the
NLRC. Unsatisfied, CAB elevated the matter to the
CA, which found CAB’s petition meritorious and
reversed the NLRC decision and resolution.
8. CABEU-NFL moved for a reconsideration but its
motion was denied, hence the petition.
Issue/s:
1. W/N CAB was guilty of acts constituting unfair labor
practice by refusing to bargain collectively – NO.
Held:
For a charge of unfair labor practice to prosper, it must be
shown that CAB was motivated by ill will, “bad faith, or
fraud, or was oppressive to labor, or done in a manner
contrary to morals, good customs, or public policy, and, of
course, that social humiliation, wounded feelings or grave
anxiety resulted x x x” in suspending negotiations with
CABEU-NFL. Notably, CAB believed that CABEU-NFL
was no longer the representative of the workers. It just
wanted to foster industrial peace by bowing to the wishes
of the overwhelming majority of its rank and file workers
and by negotiating and concluding in good faith a CBA
with CABELA.” Such actions of CAB are nowhere
tantamount to anti-unionism, the evil sought to be
punished in cases of unfair labor practices.
Furthermore, basic is the principle that good faith is
presumed and he who alleges bad faith has the duty to
prove the same. By imputing bad faith to the actuations of
CAB, CABEU-NFL has the burden of proof to present
substantial evidence to support the allegation of unfair
labor practice. Apparently, CABEU-NFL refers only to the
circumstances mentioned in the letter-response, namely,
the execution of the supposed CBA between CAB and
CABELA and the request to suspend the negotiations, to
conclude that bad faith attended CAB’s actions. The Court
is of the view that CABEU-NFL, in simply relying on the
said letter-response, failed to substantiate its claim of
unfair labor practice to rebut the presumption of good faith.
Moreover, as correctly determined by the LA, the filing of
the complaint for unfair labor practice was premature
inasmuch as the issue of collective bargaining is still
pending before the NCMB. Thus, petition is DENIED.
06 PEPSI-COLA PRODUCTS PHILIPPINES (Pepsi) Inc.
v. MOLON, REMANDABAN III, and 24 other employees
GR No. 175002 | February 18, 2013 | J. Perlas-Bernabe |
Magsanay
TOPIC: Unfair Labor Practices
FACTS:
Pepsi is a domestic corporation engaged in the
manufacturing, bottling and distribution of soft drink
products. It operates plants all over the Philippines, one of
which is located in Sto. Niño, Tanauan, Leyte (Tanauan
Plant).
Respondents are members of the Leyte Pepsi-Cola
Employees Union-Associated Labor Union (ALU for short),
a legitimate labor organization composed of rank-and-file
employees in Pepsi’s Tanauan Plant, duly registered with
the DOLE Regional Office.
Pepsi adopted a company-wide retrenchment1 program
denominated as Corporate Rightsizing Program. It sent a
notice of retrenchment to the DOLE as well as individual
notices to the affected employees informing them of their
termination from work
Among these employees were six (6) elected officers and
twenty-nine (29) active members of the ALU, including
herein respondents. ALU filed a Notice of Strike before the
National Conciliation and Mediation Board (NCMB) due to
Pepsi’s alleged acts of union busting or unfair labor
practice (ULP).
It claimed that Pepsi’s adoption of the retrenchment
program was designed solely to bust their union so that
come freedom period, Pepsi’s company union, the Leyte
Pepsi-Cola Employees Union-Union de Obreros de
Filipinas (Obreros Union for short) ―which was also the
incumbent bargaining union at that time―would garner the
majority vote to retain its exclusive bargaining status.
ALU went on strike. So, Pepsi filed before the NLRC a
petition to declare the strike illegal with a prayer for the
loss of employment status of union leaders and some
union members. After the compulsory arbitration, a return-
to-work order was issued.
Pepsi and ALU settled their labor dispute by executing an
Agreement (September 17, 1999) which stipulated:
1. that the union will receive 100% separation pay;
2. that this is without prejudice to the filing of the case by
the Union with the NLRC;
3. that the Union undertakes to sign the Quitclaim but
subject to the 2nd paragraph
They signed the quitclaim forms in September 1999
stating that Pepsi would be released and discharged from
any action arising from their employment. Nevertheless,
respondents still filed separate complaints for illegal
dismissal with the NLRC.
NLRC: Pepsi not guilty for union busting or ULP and the
retrenchment program valid. Declared ALU’s strike as
illegal. It also dismissed the complaints for illegal dismissal
due to the quitclaims.
By way of petition for certiorari, respondents argued that
Pepsi’s hiring of new employees as replacements right
after retrenching 47 workers negated the company’s claim
for financial losses.
1
Retrenchment: the reduction of costs or spending in response to
economic difficulty; the action of dismissing an employee from a job.
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CA: reversed NLRC decision. Pepsi not in good faith and
ruled the retrenchment was invalid. Pepsi is guilty of ULP
in the form of union busting as the retrenchment was to
defeat ALU’s right to self-organization.
MR denied. Hence, this petition.
ISSUE(S):   the criteria on which the selection of who to be
1. WON Pepsi’s retrenchment program was valid? –
YES
2. WON Pepsi committed ULP in the form of union
busting? - NO
HELD: Petition granted.
RATIO:
Validity of retrenchment
Retrenchment is defined as the termination of employment
initiated by the employer through no fault of the employee
and without prejudice to the latter, resorted by
management during periods of business recession,
industrial depression or seasonal fluctuations or during
lulls over shortage of materials. It is a reduction in
manpower, a measure utilized by an employer to minimize
business losses incurred in the operation of its business.
Article 297 of the Labor Code: retrenchment is one of the
authorized causes to validly terminate an employment. To
properly effect a retrenchment, the employer must:
(a) serve a written notice both to the employees and to
the DOLE at least one (1) month prior to the date of
retrenchment; and
(b) pay the retrenched employees separation pay
equivalent to one (1) month pay or at least one-half
(½) month pay for every year of service, whichever is
higher.
The prerogative of an employer to retrench its employees
must be exercised only as a last resort, considering that it
will lead to the loss of the employees’ livelihood. It is
justified only when all other less drastic means have been
tried and found insufficient or inadequate.
The court provided the requirements for retrenchment:
1. the retrenchment is reasonably necessary and likely
to prevent business losses and done in good faith;
2. the employer served written notice both to the
employees and the DOLE at least one month prior to
the intended date of retrenchment;
3. the employer pays the employees separation pay;
4. it is done in good faith for the advancement of its
interest and not to defeat or circumvent the
employees’ right to security of tenure; and
5. the employer used fair and reasonable criteria in
ascertaining who would be dismissed and who would
be retained among the employees.
Pepsi had validly implemented its retrenchment program:
1) Pepsi complied with the requirements of substantial
loss and due notice to both the DOLE and the workers
to be retrenched and there was no evidence of abuse,
arbitrariness or capriciousness.
2) Respondents had already been paid their separation
pay as evidenced by their signed quitclaims.
3) Pepsi’s Corporate Rightsizing Program was a
company-wide program which had already been
implemented in its 5 other plants which also
retrenched members of the company union (Obreras
Union).
4) Pepsi’s management exerted conscious efforts to
incorporate employee participation during the
implementation of its retrenchment program. Pepsi
had initiated sit-downs with its employees to review
retrenched would be based.
Consequently, given the general applicability of its
retrenchment program, Pepsi could not have intended to
decimate ALU’s membership, much less impinge upon its
right to self-organization, when it employed the same.
Union Busting and Unfair Labor Practice
Article 276(c) of the Labor Code: there is UNION
BUSTING when the existence of the union is
threatened by the employer’s act of dismissing the
former’s officers who have been duly-elected in
accordance with its constitution and by-laws.
UNFAIR LABOR PRACTICE refers to acts that violate
the workers’ constitutional right to organize. The
prohibited acts are related to the workers’ right to self-
organization and to the observance of a CBA. Without
that element, the acts, no matter how unfair, are not
unfair labor practices. The only exception is Art. 257 (f).
The Court finds it difficult to attribute any act of union
busting or ULP on the part of Pepsi considering that it
retrenched its employees in good faith.
Furthermore, the fact that Pepsi’s rightsizing program was
implemented on a company-wide basis dilutes
respondents’ claim that Pepsi’s retrenchment scheme was
calculated to stymie its union activities, much less diminish
its constituency.
Therefore, absent any perceived threat to ALU’s existence
or a violation of respondents’ right to self-organization,
Pepsi cannot be said to have committed union busting or
ULP in this case.
07 ROYAL PLANT WORDERS UNION v. COCA-COLA
BOTTLERS PHILIPPINES (2013)
FACTS:
1) Petitioner Coca-Cola Bottlers Philippines, Inc.
(CCBPI) is a domestic corporation engaged in the
manufacture, sale and distribution of softdrink
products. Under the employ of each bottling plant
are bottling operators. In the case of the plant in
Cebu City, there are 20 bottling operators who
work for its Bottling Line 1 while there are 12-14
bottling operators who man its Bottling Line 2. All
of them are male and they are members of herein
respondent Royal Plant Workers Union
(ROPWU).
2) The bottling operators work in two shifts. The first
shift is from 8 a.m. to 5 p.m. and the second shift
is from 5 p.m. up to the time production
operations is finished. Thus, the second shift
varies and may end beyond eight (8) hours.
However, the bottling operators are compensated
6
 with overtime pay if the shift extends beyond
eight (8) hours.
3) Prior to September 2008, the rotation is this: after
two and a half (2 ½) hours of work, the bottling
operators are given a 30-minute break and this
goes on until the shift ends.
4) In September 2008 and up to the present, the
rotation has changed and bottling operators are
now given a 30-minute break after one and one
half (1 ½) hours of work.
5) In 1974, the bottling operators of then Bottling
Line 2 were provided with chairs upon their
request. In 1988, the bottling operators of then
Bottling Line 1 followed suit and asked to be
provided also with chairs. Their request was
likewise granted.
6) HOWEVER, sometime in September 2008, the
chairs provided for the operators were removed
pursuant to a national directive of petitioner. This
directive is in line with the "I Operate, I Maintain,
I Clean" program of petitioner for bottling
operators, wherein every bottling operator is
given the responsibility to keep the machinery
and equipment assigned to him clean and safe.
The program reinforces the task of bottling
operators to constantly move about in the
performance of their duties and responsibilities.
7) COKE - With this task of moving constantly to
check on the machinery and equipment assigned
to him, a bottling operator does not need a chair
anymore.
a. the removal of the chairs is implemented
so that the bottling operators will avoid
sleeping, thus, prevent injuries to their
persons.
b. As bottling operators are working with
machines which consist of moving parts,
it is imperative that they should not fall
asleep as to do so would expose them
to hazards and injuries.
c. In addition, sleeping will hamper the
efficient flow of operations as the
bottling operators would be unable to
perform their duties competently.
8) UNION - The operators have been performing
their assigned duties and responsibilities
satisfactorily for thirty (30) years using chairs.
a. There is no record of poor performance
because the operators are sitting all the
time. There is no single incident when
the attention of an operator was called
for failure to carry out his assigned
tasks.
b. CCBPI has not submitted any evidence
to prove that the performance of the
operators was poor before the removal
of the chairs and that it has improved
after the chairs were removed.
c. According to the Union, such removal
constitutes a violation of the
i. 1) Occupational Health and
Safety Standards which
provide that every worker is
entitled to be provided by the
employer with appropriate
seats, among others;
ii. 2) policy of the State to assure
the right of workers to a just
and humane condition of work
as provided for in Article 3 of
the Labor Code;
iii. 3) Global Workplace Rights
Policy of CCBPI which provides
for a safe and healthy
workplace by maintaining a
productive workplace and by
minimizing the risk of accident,
injury and exposure to health
risks;
iv. and 4) diminution of benefits
provided in Article 100 of the
Labor Code
9) Arbitration Committee – ruled in favor of the
Union.
a. that the use of chairs by the operators
had been a company practice for 34
years in Bottling Line 2, from 1974 to
2008, and 20 years in Bottling Line 1,
from 1988 to 2008; that the use of the
chairs by the operators constituted a
company practice favorable to the
Union; that it ripened into a benefit after
it had been enjoyed by it; that any
benefit being enjoyed by the employees
could not be reduced, diminished,
discontinued, or eliminated by the
employer in accordance with Article 100
of the Labor Code, which prohibited the
diminution or elimination by the
employer of the employees’ benefit; and
that jurisprudence had not laid down any
rule requiring a specific minimum
number of years before a benefit would
constitute a voluntary company practice
which could not be unilaterally
withdrawn by the employer.
10) CA – reversed Arbitration’s decision.
a. removal of the chairs from the
manufacturing/production lines by
CCBPI is within the province of
management prerogatives; that it was
part of its inherent right to control and
manage its enterprise effectively; and
that since it was the employer’s
discretion to constantly develop
measures or means to optimize the
7
 efficiency of its employees and to keep
its machineries and equipment in the
best of conditions
b. removal of the chairs was not done for
the purpose of defeating or
circumventing the rights of its
employees under the special laws, the
Collective Bargaining Agreement (CBA)
or the general principles of justice and
fair play.
c. It opined that the principles of justice
and fair play were not violated because,
when the chairs were removed, there
was a commensurate reduction of the
working time for each rotation in each
shift
d. The provision of chairs for the
bottling operators was never part of
the CBAs contracted between the
Union and CCBPI
i. As such, CCBPI could
withdraw this provision if it was
not necessary in the exigencies
of the work, if it was not
contributing to the efficiency of
the bottling operators or if it
would expose them to some
hazards
e. provision of chairs to the bottling
operators cannot be covered by
Article 100 of the Labor Code on
elimination or diminution of benefits
because the employee’s benefits
referred to therein mainly involved
monetary considerations or
privileges converted to their
monetary equivalent.
ISSUE:
Whether the removal of chairs of the operators assigned at
the production/manufacturing line while performing their
duties and responsibilities is valid or not? The removal of
chairs is valid!! It is a valid exercise of management
prerogative and it is not written in CBA.
RATIO:
MANAGEMENT PREROGATIVE
The chairs were not removed indiscriminately. They were
carefully studied with due regard to the welfare of the
members of the Union. The removal of the chairs was
compensated by: a) a reduction of the operating hours of
the bottling operators from a two-and-one-half (2 ½)-hour
rotation period to a one-and-a-half (1 ½) hour rotation
period; and b) an increase of the break period from 15 to
30 minutes between rotations.
the decision to remove the chairs was done with good
intentions as CCBPI wanted to avoid instances of
operators sleeping on the job while in the performance of
their duties and responsibilities and because of the fact
that the chairs were not necessary considering that the
operators constantly move about while working. In short,
the removal of the chairs was designed to increase work
efficiency. Hence, CCBPI’s exercise of its management
prerogative was made in good faith without doing any
harm to the workers’ rights.
The fact that there is no proof of any operator sleeping on
the job is of no moment. There is no guarantee that such
incident would never happen as sitting on a chair is
relaxing.
NO VIOLATION OF LABOR LAWS
There is no law that requires employers to provide chairs
for bottling operators.
The CA correctly ruled that the Labor Code, specifically
Article 132 thereof, only requires employers to provide
seats for women. No similar requirement is mandated for
men or male workers. It must be stressed that all
concerned bottling operators in this case are men.
the removal of the chairs was compensated by the
reduction of the working hours and increase in the rest
period. The directive did not expose the bottling operators
to safety and health hazards.
The Union should not complain too much about standing
and moving about for one and one-half (1 ½) hours
because studies show that sitting in workplaces for a long
time is hazardous to one’s health. The report of VicHealth,
Australia,12 disclosed that "prolonged workplace sitting is
an emerging public health and occupational health issue
with serious implications for the health of our working
population. Importantly, prolonged sitting is a risk factor for
poor health and early death, even among those who meet,
or exceed, national13 activity guidelines."
NO VIOLATION OF CBA
The CBA between the Union and CCBPI contains no
provision whatsoever requiring the management to provide
chairs for the operators in the production/manufacturing
line while performing their duties and responsibilities.
According to Sec 2, Article 1, the CBA expressly provides
that benefits and/or privileges, not expressly given therein
but which are presently being granted by the company and
enjoyed by the employees, shall be considered as purely
voluntary acts by the management and that the
continuance of such benefits and/or privileges, no
matter how long or how often, shall not be understood
as establishing an obligation on the company’s part.
Since the matter of the chairs is not expressly stated in the
CBA, it is understood that it was a purely voluntary act on
the part of CCBPI and the long practice did not convert it
into an obligation or a vested right in favor of the Union.
08. G.R. No. 170054; January 21, 2013
GOYA, INC., Petitioner, v. GOYA, INC. EMPLOYEES
UNION-FFW, Respondent
FACTS:
8
 o Petitioner Goya Inc. (Goya) hired contractual
employees from PESO Resources Development
Corporation (PESO).
o This prompted Goya, Inc. Employees Union-FFW
(Union) to request for a grievance conference on
the ground that the contractual workers do not
belong to the categories of employees stipulated
in their CBA.
o The Union also argued that hiring contractual
employees is contrary to the union security
clause embodied in the CBA.
o When the matter remained unresolved, the
grievance was referred to the NCMB for voluntary
arbitration.
o The Union argued that Goya is guilty of ULP for
gross violation of the CBA. The voluntary
arbitrator dismissed the Unions charge of ULP
but Goya was directed to observe and comply
with the CBA.
o While the Union moved for partial consideration
of the VA decision, Goya immediately filed a
petition for review before the Court of Appeals to
set aside the VAs directive to observe and
comply with the CBA commitment pertaining to
the hiring of casual employees.
o Goya argued that hiring contractual employees is
a valid management prerogative.
o The Court of Appeals dismissed the petition.
ISSUE: Whether the act of hiring contractual employees is
a valid exercise of management prerogative
HELD: No, the CA did not commit serious error when it
sustained the ruling that the hiring of contractual
employees from PESO was not in keeping with the intent
and spirit of the CBA. In this case, a complete and final
adjudication of the dispute between the parties necessarily
called for the resolution of the related and incidental issue
of whether the Company still violated the CBA but without
being guilty of ULP as, needless to state, ULP is
committed only if there is gross violation of the agreement.
Goya kept on harping that both the VA and the CA
conceded that its engagement of contractual workers from
PESO was a valid exercise of management prerogative. It
is confused. To emphasize, declaring that a particular act
falls within the concept of management prerogative is
significantly different from acknowledging that such act is a
valid exercise thereof. What the VA and the CA correctly
ruled was that the Company’s act of contracting
out/outsourcing is within the purview of management
prerogative. Both did not say, however, that such act is a
valid exercise thereof. Obviously, this is due to the
recognition that the CBA provisions agreed upon by
Goya and the Union delimit the free exercise of
management prerogative pertaining to the hiring of
contractual employees. A collective bargaining
agreement is the law between the parties. A collective
bargaining agreement or CBA refers to the negotiated
contract between a legitimate labor organization and the
employer concerning wages, hours of work and all other
terms and conditions of employment in a bargaining unit.
As in all contracts, the parties in a CBA may establish
such stipulations, clauses, terms and conditions as they
may deem convenient provided these are not contrary to
law, morals, good customs, public order or public policy.
Thus, where the CBA is clear and unambiguous, it
becomes the law between the parties and compliance
therewith is mandated by the express policy of the law.
As repeatedly held, the exercise of management
prerogative is not unlimited; it is subject to the
limitations found in law, collective bargaining
agreement or the general principles of fair play and
justice. Petition is DENIED.
9. T & H SHOPFITTERS CORPORATION/GIN QUEEN
CORPORATION v. T & H SHOPFITTERS
CORPORATION/GIN QUEEN WORKERS UNION et al
G.R. No. 191714, February 26, 2014, Mendoza, J:
Facts:
1. Respondents officers and members of THS–GQ
union, filed their Complaint for ULP against T&H
Shopfitters Corporation and Gin Queen
Corporation (collectively referred to as
“petitioners”) before theLA.
2. Respondents treated T&H Shopfitters and Gin
Queen as a single entity and their sole employer.
In their desire to improve their working conditions,
respondents and other employees of petitioners
held their first formal meeting to discuss the
formation of a union. The following day, 17
employees were barred from entering petitioners’
factory premises located in Castillejos, Zambales,
and ordered to transfer to T&H Shopfitters’
warehouse at Subic Bay Freeport Zone (SBFZ)
purportedly because of its expansion.
a. Afterwards, the 17 employees were
repeatedly ordered to go on forced leave
due to the unavailability of work.
b. DOLE Regional Office No. III issued a
certificate of registration in favor of
THS–GQ Union.
3. Respondents contended that the affected
employees were not given regular work
assignments, while subcontractors were
continuously hired to perform their functions.
Later, an agreement between petitioners and the
Union was reached and the former agreed to give
priority to regular employees in the distribution of
work assignments. However, petitioners never
complied with its commitment.
4. THS–GQ Union filed a petition for certification
election. An order was issued to hold the
certification election in both T&H Shopfitters and
Gin Queen.
5. Meanwhile, the Director for Gin Queen informed
its employees of the expiration of the lease
contract between Gin Queen and its lessor in
Castillejos, Zambales and announced the
relocation of its office and workers to Cabangan,
Zambales. The union officers and members were
made to work as grass cutters in Cabangan. Due
to these circumstances, the employees assigned
did not report for work.
6. On the day of the election, the employees were
escorted from the field trip to the polling center in
Zambales to cast their votes. The remaining
employees situated at the SBFZ plant cast their
votes as well. However, due to the heavy
9
 pressure exerted by petitioners, the votes for “no
union” prevailed. Thus, the Union filed its protest
with respect to the certification election
proceedings.
7. The following week after the certification elections
were held, petitioners retrenched the Union
officers and members assigned at the Zambales
plant.
8. LA = DISMISSED2 COMPLAINT OF
RESPONDENTS. NLRC and CA = REVERSED. 3
Union won
Issue/s:
2. WON ULP acts were committed by petitioners
against respondents – YES.
Held:
1. ULP relates to the commission of acts that
transgress the workers’ right to organize. As
specified in Articles 248 [now Article 257] and
249 [now Article 258] of the Labor Code, the
prohibited acts must necessarily relate to the
workers’ right to self–organization. In the case of
Insular Life Assurance Co., Ltd. Employees
Association – NATU v. Insular Life Assurance
Co. Ltd., this Court had occasion to lay down the
test of whether an employer has interfered with
and coerced employees in the exercise of their
right to self–organization, that is, whether the
employer has engaged in conduct which, it may
reasonably be said, tends to interfere with the
free exercise of employees’ rights; and that 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.
The questioned acts of petitioners: 1) sponsoring
a field trip to Zambales to the exclusion of union
members, before the election; 2) the active
campaign by the sales officer of petitioners
against the union prevailing as a bargaining
agent during the field trip; 3) escorting its
employees after the field trip to the polling center;
4) the continuous hiring of subcontractors
performing their functions; 5) assigning union
members to the site to work as grass cutters; and
6) the enforcement of work on a rotational basis
for union members, all reek of interference on the
part of petitioners.
The various acts of petitioners reasonably
support an inference that such were all
2
Basically, there was no showing that the transfer of these 17
workers is considered an unfair labor practice of the respondents
considering that their transfer was effected long before the union
was organized.
3
They committed ULP acts consisting in interfering with the
exercise of the employees’ right to self–organization by
sponsoring a field trip on the day preceding the certification
election, warning the employees of dire consequences should the
union prevail, and escorting them to the polling center. Also,
discriminating in regard to conditions of employment in order to
discourage union membership.
orchestrated to restrict respondents’ free exercise
of their right to self–organization. Petitioners’
undisputed actions prior and immediately before
the scheduled certification election, while
seemingly innocuous, unduly meddled in the
affairs of its employees in selecting their
exclusive bargaining representative.
Petitioners had no business persuading and/or
assisting its employees in their legally protected
independent process of selecting their exclusive
bargaining representative.4 The fact and peculiar
timing of the field trip was undoubtedly
extraneous influence designed to impede
respondents in their quest to be certified. This
cannot be countenanced.
Not content with achieving a “no union” vote in
the certification election, petitioners launched a
vindictive campaign against union members by
assigning work on a rotational basis while
subcontractors performed the latter’s functions
regularly. Some of the respondents were made to
work as grass cutters in an effort to dissuade
them from further collective action. Again, this
cannot be countenanced. More importantly,
petitioners’ bare denial of some of the
complained acts and unacceptable explanations
cannot prevail over respondents’ detailed
narration of the events that transpired. It bears to
emphasize that in labor cases, the quantum of
proof necessary is substantial evidence or that
amount of relevant evidence as a reasonable
mind might accept as adequate to support a
conclusion, even if other minds, equally
reasonable, might conceivably opine otherwise.
WHEREFORE, the November 12, 2009 Decision
of the Court of Appeals and its March 24, 2010
Resolution, in CA–G.R. SP No. 107188, are
AFFIRMED, except with respect to the award of
attorney’s fees which is hereby DELETED.
10 Mendoza v. Officers of Manila Water Employees
Union (MWEU)
FACTS
Petitioner was a member of the Manila Water
Employees Union (MWEU), a (DOLE)-registered labor
organization consisting of rank-and-file employees within
Manila Water Company (MWC). The respondents herein
were MWEU officers.
MWEU through Cometa (MWEU Secretary)
informed petitioner that the union was unable to fully
deduct the increased P200 union dues from his salary due
to lack of the required check-off authorization from him.
Petitioner was warned that his failure to pay the union
dues would result in sanctions upon him. The MWEU
grievance committee recommended that petitioner be
suspended for 30 days and was unanimously approved.
The petitioner filed an appeal but was denied.
Petitioner was again penalized for a suspension
and filed for an appeal but was rejected. Consequently,
4
Holy Child Catholic School v. Hon. Patricia Sto. Tomas –
because the ER is a mere bystander.
10
MWEU scheduled an election of officers and petitioner by the unanimous vote of the EB, his timely appeal was
filed his certificate of candidacy for vice-President, but he again not acted upon by said board.
was disqualified for not being a member in good standing Thus, contrary to respondents’ argument that
on account of his suspension. petitioner lost his right to appeal when he failed to petition
For the third time, petitioner was charged with to convene the general assembly through the required
non-payment of union dues and for failure to attend the signature of 30% of the union membership in good
hearing, he was meted the penalty of expulsion from the standing pursuant to MWEU’s constitution and By-Laws or
union. His pleas for an appeal to the General Membership by a petition of the majority of the general membership in
Assembly were once more unheeded. good standing, the court finds that petitioner was illegally
During the freedom period and negotiations for a suspended for the second time and thereafter unlawfully
new CBA with MWC, petitioner joined another union, the expelled from MWEU due to respondents’ failure to act on
Workers Association for Transparency, Empowerment and his written appeals.
Reform, All-Filipino Workers Confederation (WATER- The EB must first act on his two appeals before
AFWC). He was elected union President. the matter could properly be referred to the general
In seeking recourse to the Labor Arbiter, NLRC membership. Because respondents did not act on his two
and CA, the complaint for unfair labor practices filed by appeals, petitioner was unceremoniously suspended,
Mendoza against respondents was dismissed on the disqualified and deprived of his right to run for the position
ground that the complaint covers intra-union disputes of MWEU vice-President in the election of officers,
which the mentioned authorities do not have jurisdiction. It expelled from MWEU, and forced to join another union.
also ruled that the petitioner failed to For these, respondents are guilty of unfair labor
provide substantial evidence on the violations of the practices under Article 249 (a) and (b) - that is, violation of
respondents against his right to appeal and self- petitioner’s right to self-organization, unlawful
organization. discrimination, and illegal termination of his union
ISSUE: Whether or not the respondents are guilty of unfair membership - which case falls within exclusive juriscidtion
labor practices. of the Labor arbiters, in accordance with Article 217 of the
HELD Labor Code.
Yes.
The court ruled that the Labor Arbiter, NLRC and Note: “In essence, [unfair labor practice] relates to the
CA erred in failing to resolve petitioner’s charge of unfair commission of acts that transgress the workers’ right to
labor practices against respondents. It is true that some of organize.” “[A]ll the prohibited acts constituting unfair labor
petitioner’s causes of action constitute intra-union cases practice in essence relate to the workers’ right to self-
cognizable by the BLR under Article 226 of the Labor organization.” “[T]he term unfair labor practice refers to
Code. However, petitioner’s charge of unfair labor that gamut of offenses defined in the Labor Code which, at
practices falls within the srcinal and exclusive jurisdiction their core, violates the constitutional right of workers and
of the Labor Arbiters, pursuant to Article 217 of the Labor employees to self-organization.”
Code.
Petitioner contends that respondents committed
acts constituting unfair labor practices - which charge was
particularly laid out in his pleadings, but that the Labor
Arbiter, the NLRC, and the CA ignored it and simply
dismissed his complaint on the ground that his causes of
action were intra- or inter-union in nature. Specifically,
petitioner claims that he was suspended and expelled by
MWEU illegally as a result of the denial of his right to
appeal his case to the general membership assembly in
accordance with the union’s constitution and by-laws.
In regard to suspension of a union member,
MWEU’s constitution and by-Laws provides that when an
MWEU member is suspended, he is given the right to
appeal such suspension within three working days from
the date of notice of said suspension, which appeal the
MWEU Executive Board is obligated to act upon by a
simple majority vote. When the penalty imposed is
expulsion, the expelled member is given seven days from
notice of said dismissal and/or expulsion to appeal to the
Elective Board, which is required to act by a simple
majority vote of its members.
The documentary evidence is clear that when
petitioner received Borela’s (president) letter informing him
of the Executive Board’s unanimous approval of the
grievance committee recommendation to suspend him for
the second time, he immediately and timely filed a written
appeal. However, the Executive Board did not act thereon.
Then again, when petitioner was charged for the
third time and meted the penalty of expulsion from MWEU

11