G.R. No.

140992             March 25, 2004

SAMAHANG MANGGAGAWA SA SULPICIO LINES, INC.–NAFLU, RODOLFO ALINDATO, ROQUE TAN,

JESSIE LIM, SUSAN TOPACIO, LYDDA PASCUAL, BERNARDO ALCANTARA, GELACIO DESQUITADO,
RODRIGO AVELINO, LEONARDO ANDRADE, DANILO CHUA, AMANDO EUGENIO, CALVIN LOPEZ,
ANDRES BASCO, JR., and CIRILO ALON, petitioners,
vs.
SULPICIO LINES, INC., respondent.

DECISION

SANDOVAL-GUTIERREZ, J.:

A strike is a powerful weapon of the working class. But like a sensitive explosive, it must be handled
carefully, lest it blows up in the workers’ own hands.1 Thus, the right to strike has to be pursued within
the bounds of law.

For our resolution is the instant petition for review on certiorari under Rule 45 of the 1997 Rules of Civil
Procedure, as amended, assailing the Decision2 dated May 28, 1999 and the Resolution3 dated November
25, 1999 rendered by the Court of Appeals in CA-G.R. SP No. 51322, entitled "Samahang Manggagawa
sa Sulpicio Lines, Inc. – NAFLU vs. National Labor Relations Commission and Sulpicio Lines, Inc."

The factual antecedents as gleaned from the records are:

On February 5, 1991, Sulpicio Lines, Inc. (herein respondent) and the Samahang Manggagawa sa Sulpicio
Lines Inc. – NAFLU (herein petitioner) executed a collective bargaining agreement (CBA) with a term of
five (5) years (from October 17, 1990 to October 16, 1995).

After three (3) years or on December 15, 1993, petitioner union and respondent company started their
negotiation on the CBA’s economic provisions.4 But this negotiation remained at stalemate.

On March 1, 1994, petitioner filed with the National Conciliation and Mediation Board (NCMB), National
Capital Region, a notice of strike due to collective bargaining deadlock, docketed as NCMB-NCR-NS-03-
118-94.

For its part, respondent, on March 21, 1994, filed with the Office of the Secretary, Department of Labor
and Employment a petition praying that the Labor Secretary assume jurisdiction over the controversy.

On March 23, 1994, former Labor Secretary Nieves R. Confesor issued an Order assuming jurisdiction
over the labor dispute pursuant to Article 263 (g) of the Labor Code, as amended, thus:

"WHEREFORE PREMISES CONSIDERED, this Office assumes jurisdiction over the labor dispute at Sulpicio
Lines, Inc. pursuant to Article 263 (g) of the Labor Code, as amended.

"Accordingly, any strike or lockout whether actual or intended is hereby enjoined.

"Further, the parties are directed to cease and desist from committing any and all acts that might
exacerbate the situation.

"SO ORDERED."

Meanwhile, on May 20, 1994, petitioner filed with the NCMB a second notice of strike alleging that
respondent company committed acts5 constituting unfair labor practice amounting to union busting,
docketed as NCMB NCR-05-261-94.

Provoked by respondent’s alleged unfair labor practice/s, petitioner union immediately conducted a
strike vote. Thus, on May 20, 1994, about 9:30 o’clock in the morning, 167 rank-and-file employees,
officers and members of petitioner, did not report for work and instead gathered in front of Pier 12,
North Harbor at Manila.

As a remedial measure, former Labor Secretary Confesor issued an Order dated May 20, 1994 directing
the striking employees to return to work; and certifying the labor dispute to the National Labor Relations
Commission (NLRC) for compulsory arbitration. This certified labor dispute was docketed as NLRC Case
No. CC-0083-94.

Meanwhile, respondent company filed with the NLRC a complaint for "illegal strike/clearance for
termination," docketed as NLRC NCR Case No. 00-05-04705-94.

On September 29, 1995, the NLRC issued a Resolution6 declaring the strike of petitioner’s officers and
members illegal, with notice to respondent of the option to terminate their (petitioner’s officers)
employment. In the same Resolution, the NLRC dismissed petitioner’s complaint against respondent,
thus:

"WHEREFORE, premises considered, after a careful and judicious consideration of the facts, arguments
and evidence thus adduced, it is the considered opinion of thie Commission that the union (Samahang
Manggagawa sa Sulpicio Lines, Inc.) had clearly engaged in an illegal strike on May 20, 1994, when its
officers and members actively participated in a well concerted refusal, stoppage and cessation to render
work at Sulpicio Lines, Inc.. In clear violation not only of the procedural requirements of a valid strike,
but worse, in clear and blatant contravention of the assumption order of the Secretary of Labor and
Employment. Consequently, the following union officers named in the complaint, to wit:

1) Allan F. Aguhar 9) Rodrigo Avelino

2) Rodolfo Alindato 10) Leonardo Andrade

3) Roque Tan 11) Danilo Chua

4) Jessie Lim 12) Amando Eugenio

5) Susan Topacio 13) Calvin Lopez

6) Lydda Pascual 14) Andres Rasco, Jr.

 7) Bernardo Alcantara 15) Cirilo Alon

8) Gelacio Dequitado

are declared to have lost their employment status with the company, and the latter may now, if it so
desires, terminate their employment with it. The union’s complaint against the company is hereby
DISMISSED for lack of merit.

"SO ORDERED."

Petitioner filed a motion for reconsideration but was denied by the NLRC in a Resolution7 dated January
15, 1996.

On March 19, 1996, petitioner filed with this Court a petition for certiorari assailing the NLRC
Resolutions. Pursuant to our ruling in St. Martin’s Funeral Home vs. NLRC,8 we referred the petition to
the Court of Appeals for its appropriate action and disposition.

On May 28, 1999, the Court of Appeals rendered a Decision affirming the NLRC Resolutions. The
Appellate Court held (1) that the NLRC has jurisdiction to resolve the issue of legality of the strike; (2)
that the May 20, 1994 temporary work stoppage by the officers and members of petitioner amounted to
an illegal strike; (3) that even assuming that respondent committed unfair labor practice/s, still, the
strike is illegal because it failed to comply with the mandatory procedural requirements of a valid strike
under Article 263 (c) and (f) of the Labor Code, as amended; and (4) that the dismissal of petitioner’s
officers who knowingly participated in an illegal strike is in accordance with Article 264 (a) of the Labor
Code, as amended.

On October 20, 1995, petitioner filed a motion for reconsideration but was denied by the Court of
Appeals in a Resolution dated November 25, 1999.

Hence, this petition for review on certiorari. Petitioner alleged that the Court of Appeals seriously erred
(1) in holding that the one-day work stoppage of petitioner’s officers and members is an illegal strike; (2)
in sustaining the dismissal from the service of its officers; and (3) in ruling that the NLRC has jurisdiction
over a petition to declare the strike illegal.

The basic issue for our determination is whether the strike staged by petitioner’s officers and members
is illegal. Articles 263 and 264 of the Labor Code, as amended, provide:

"ART. 263. STRIKES, PICKETING AND LOCKOUTS.

xxx

(c) In cases of bargaining deadlocks, the duly certified or recognized bargaining agent may file a notice of
strike x x x with the Ministry (now Department) at least 30 days before the intended date thereof. In
cases of unfair labor practice, the period of notice shall be 15 days and in the absence of a duly
certified or recognized bargaining agent, the notice of strike may be filed by any legitimate labor
organization in behalf of its members. However, in case of dismissal from employment of union
officers duly elected in accordance with the union constitution and by-laws, which may constitute union
busting where the existence of the union is threatened, the 15-day cooling-off period shall not apply
and the union may take action immediately.

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.
x x x. 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 (now Department) 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 x x x shall furnish the Ministry (now Department) the results of the voting at
least seven days before the intended strike or lockout, subject to the cooling-off period herein
provided.

x x x.

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 (now Department).

x x x."

Following are the Implementing Guidelines of the above provisions issued by the Department of Labor
and Employment:

1. A strike shall be filed with the Department of Labor and Employment at least 15 days if the issues
raised are unfair labor practice or at least 30 days if the issue involved bargaining deadlock. However, in
case of dismissal from employment of union officers duly elected in accordance with the union
constitution and by-laws, which may constitute union busting where the existence of the union is
threatened, the 15-day cooling-off period shall not apply and the union may take action immediately;

2. The strike shall be supported by a majority vote of the members of the union obtained by secret
ballot in a meeting called for the purpose; and

3. A strike vote shall be reported to the Department of Labor and Employment at least seven (7) days
before the intended strike.

There is no showing that the petitioner union observed the 7-day strike ban; and that the results of the
strike vote were submitted by petitioners to the Department of Labor and Employment at least seven (7)
days before the strike.

We thus hold that for failing to comply with the mandatory requirements of Article 263 (c) and (f) of the
Labor Code, the strike mounted by petitioner union on May 20, 1994 is illegal.

In Gold City Integrated Port Service, Inc. vs. NLRC,9 we stressed that "the language of the law leaves no
room for doubt that the cooling-off period and the seven-day strike ban after the strike-vote report
were intended to be mandatory."
But petitioner insists that the strike can still be declared legal for it was done in good faith, being in
response to what its officers and members honestly perceived as unfair labor practice or union busting
committed by respondent.

Petitioner’s accusation of union busting is bereft of any proof. We scanned the records very carefully
and failed to discern any evidence to sustain such charge.

In Tiu vs. NLRC,10 we held:

"x x x. It is the union, therefore, who had the burden of proof to present substantial evidence to
support its allegations (of unfair labor practices committed by management).

"x x x.

"x x x, but in the case at bar the facts and the evidence did not establish even at least a rational basis
why the union would wield a strike based on alleged unfair labor practices it did not even bother to
substantiate during the conciliation proceedings. It is not enough that the union believed that the
employer committed acts of unfair labor practice when the circumstances clearly negate even a prima
facie showing to warrant such a belief."

We explained in National Federation of Labor vs. NLRC11 that "with the enactment of Republic Act No.
6715 which took effect on March 21, 1989, the rule now is that such requirements as the filing of a
notice of strike, strike vote, and notice given to the Department of Labor are mandatory in
nature. Thus, even if the union acted in good faith in the belief that the company was committing an
unfair labor practice, if no notice of strike and a strike vote were conducted, the said strike is illegal."

In a desperate attempt to justify its position, petitioner insists that what transpired on May 20, 1994 was
not a strike but merely a "one-day work absence"12 or a "simple act of absenteeism".13

We are not convinced. A strike, as defined in Article 212 (o) of the Labor Code, as amended, means "any
temporary stoppage of work by the concerted action of employees as a result of an industrial or labor
dispute." The term "strike" shall comprise not only concerted work stoppages, but also slowdowns, mass
leaves, sitdowns, attempts to damage, destroy or sabotage plant equipment and facilities, and similar
activities.14

The basic elements of a strike are present in the case at bar. First, petitioner’s officers and members
numbering 167, in a concerted manner, did not report for work on May 20, 1994; second, they gathered
in front of respondent’s office at Pier 12, North Harbor at Manila to participate in a strike voting
conducted by petitioner; and third, such union activity was an aftermath of petitioner’s second notice of
strike by reason of respondent’s unfair labor practice/s. Clearly, what transpired then was a strike
because the cessation of work by petitioner’s concerted action resulted from a labor dispute.

Invoking compassion, petitioner pleads that its officers who participated in the one-day strike should not
be dismissed from the service, considering that respondent’s business activities were not interrupted,
much less paralyzed. While we sympathize with their plight, however, we must take care that in the
contest between labor and capital, the results achieved are fair and in conformity with the law.15

Pertinent is Article 264 (a) of the same Code, thus:

"ART. 264. PROHIBITED ACTIVITIES.

"x x x. 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.

x x x."

It is worth reiterating that the strike is illegal for failure of petitioner to submit the strike vote to the
Department of Labor and Employment at least seven (7) days prior thereto. Also, petitioner failed to
prove that respondent company committed any unfair labor practice. Amid this background,
the participation of the union officers in an illegal strike forfeits their employment status.

In Telefunken Semiconductors Employees Union-FFW vs. Secretary of Labor and Employment,16 we

explained –

"The effects of such illegal strikes, outlined in Article 265 (now Article 264) of the Labor Code, make a
distinction between workers and union officers who participate therein.

"A 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 their
employment status. An ordinary striking worker cannot be terminated for mere participation in an
illegal strike. There must be proof that he committed illegal acts during a strike. A union officer, on the
other hand, may be terminated from work when he knowingly participates in an illegal strike, and like
other workers, when he commits an illegal act during a strike."

Moreover, petitioner maintains that the Labor Arbiter, not the NLRC, should have taken cognizance of
the case at bar. We do not agree.

In International Pharmaceuticals, Inc. v. Secretary of Labor and Employment,17 we held:

‘x x x [T]he Secretary was explicitly granted by Article 263 (g) of the Labor Code the authority to assume
jurisdiction over a labor dispute causing or likely to cause a strike or lockout in an industry indispensable
to the national interest, and decide the same accordingly. Necessarily, this authority to assume
jurisdiction over the said labor dispute must include and extend to all questions and controversies
arising therefrom, including cases over which the Labor Arbiter has exclusive jurisdiction’
(underscoring supplied).

"In the same manner, when the Secretary of Labor and Employment certifies the labor dispute to the
NLRC for compulsory arbitration the latter is concomitantly empowered to resolve all questions and
controversies arising therefrom including cases otherwise belonging originally and exclusively to the
Labor Arbiter."

WHEREFORE, the petition is DENIED. The Decision and Resolution of the Court of Appeals dated May 28,
1999 and November 25, 1999 are hereby AFFIRMED.

SO ORDERED.
G.R. No. 158158            January 17, 2005

BUKLURAN NG MANGGAGAWA SA CLOTHMAN KNITTING CORPORATION – SOLIDARITY OF UNIONS IN

THE PHILIPPINES FOR EMPOWERMENT AND REFORMS (BMC-SUPER) AND RAYMOND TOMAROY, ROEL
SARDONIDOS, JOSEPH SEDERIO, MARITCHU JAVELLANA, ENRIQUE OMADTO, EFREN MOGAR,
FRANCISCO BERTULFO, JUDY ROQUERO, PATERNO SILVESTRE, CAYETANO PALMON, TEODORO OCOP
AND JOSEPH ESTIFANO, petitioners,
vs.
COURT OF APPEALS (Former Fifteenth Division), NATIONAL LABOR RELATIONS COMMISSION (Second
Division), and CLOTHMAN KNITTING CORPORATION, respondents.

DECISION

CALLEJO, SR., J.:

This is a petition for review of the Resolutions1 of the Court of Appeals (CA) in CA-G.R. SP No. 73353 filed
by the Bukluran ng Manggagawa sa Clothman Knitting Corporation – Solidarity of Unions in the
Philippines for Empowerment and Reforms (the petitioner union) and Raymond Tomaroy, Roel
Sardonidos, Joseph Sederio, Maritchu Javellana, Enrique Omadto, Efren Mogar, Francisco Bertulfo, Judy
Roquero, Paterno Silvestre, Cayetano Palmon, Teodoro Ocop and Joseph Estifano.

Respondent Clothman Knitting Corporation (CKC) is a domestic corporation engaged in

knitting/textiles.2 It has approximately one hundred forty-four (144) rank-and-file employees. The
petitioner union is a legitimate labor organization of rank-and-file employees therein. The petitioners
were rank-and-file employees of the respondent and were also members and officers of the petitioner
union.

In the year 2001, the rank-and-file employees at the CKC banded together and formed the petitioner
union. It was registered with the Department of Labor and Employment (DOLE) on February 23, 2001. In
reaction thereto, the respondent, headed by its President, Paul U. Lee, gathered the employees and
advised them not to listen to outsiders.3

Meanwhile, another group of rank-and-file employees banded together and formed the Nagkakaisang
Lakas ng Manggagawa sa Clothman Corporation – Katipunan (NLM-Katipunan). The NLM-Katipunan was
issued a certificate of registration on April 23, 2001 by the DOLE.4 A petition for certification election was
later filed by the petitioner union with the Bureau of Labor Relations (BLR).

Pending the resolution of the petition for certification election, the respondent issued a
Memorandum5 dated March 2, 2001, informing the employees of the change in the schedule brought
about by the decrease in the orders from the customers.

On March 10, 2001, another Memorandum6 was issued by the respondent informing its employees at
the Dyeing and Finishing Division that a temporary shutdown of the operations therein would be
effected for one week, from March 12 to 17, 2001. The employees were advised to go on vacation leave,
and were asked to verify any changes in the schedule from the Human Resources Division on March 17,
2001.

Unable to solve its financial problems, the respondent decided to temporarily shutdown its operations
at the Dyeing and Finishing Division effective the next day, scheduled to resume until further notice. It
notified the DOLE of the said shutdown on May 26, 2001.7 The operations of the other divisions of the
CKC remained normal.

For its reduced dyeing and finishing needs, the respondent brought the textiles to Crayons, Inc., a sister
company. On June 11, 2001, while the respondent’s service truck with plate number TBK-158 was to
deliver fabrics in Bulacan, the group of petitioner Raymond Tomaroy and some companions approached
the truck as it made its way towards Don Pedro Street and blocked its way. As a result, the driver of the
service truck decided to return to the respondent’s compound. Later that day, petitioner Tomaroy, with
sixteen (16) members of the petitioner union, staged a picket in front of the respondent’s compound,
carrying placards with slogans that read:

1. Itigil ang sabwatan ng KATIPUNAN (FABIAN GROUP) at management BMC-SUPER.

2. Mr. Paul Lee – Huwag mong ipitin ang mid-year, 13th month pay ng mga manggagawa sa CKC. BMC-
SUPER.

3. Ibalik ang pasok sa Finishing Department.

4. Mr. Paul Lee – Magagara ang sasakyan mo, Montero, BMW, Pajero pero kaunting benepisyo ng
manggagawa ay di mo maibigay. BMC-SUPER.

5. Kilalanin ang karapatan ng manggagawa na magtatag ng unyon. BMC-SUPER.8

On June 14, 2001, twenty-three (23) members of the petitioner union gathered in front of the
respondent’s compound carrying the same placards. Later that day, petitioner Tomaroy agreed to talk to
the management with the following priority demands: (a) resumption of work; and (b) 13th month
pay.9 The next day, members of the petitioner union and their supporters gathered in front of the
respondent’s compound.10 From June 16, 2001 up to June 18, 2001, the members, as well as supporters
of the union, gathered again in front of the company’s compound.11

On June 25, 2001, the respondent filed a petition to declare the strike illegal before the arbitration
branch of the National Labor Relations Commission (NLRC), docketed as NLRC-NCR 06-03332-2001.12 The
respondent alleged that the picket of the members of the union from June 11, 2001 to June 18, 2001 in
front of the company’s compound constituted an illegal strike. It cited the following reasons:

a) The strikers/picketers did not conduct a strike vote and no cooling-off period was observed;

b) The strikers/picketers did not file a notice of strike;

c) The reasons for the strike/picket involve a non-strikeable issue;

d) The work slowdown/picket caused damages to the petitioner in the sum of FIVE MILLION PESOS
(₱5,000,000.00);

e) The illegal acts of respondents constrained petitioner to seek the services of undersigned counsel for
an attorney’s fee of ₱50,000.00 and ₱2,000.00 per appearance.13

In a Decision dated October 18, 2001, the Labor Arbiter granted the petition, declared the strike illegal
and the employment status of the union officers who participated therein as terminated:

WHEREFORE, in view of the foregoing, the petition filed by the petitioner is hereby GRANTED.

The strike conducted by the respondents is hereby declared as illegal.

Consequently, due to their illegal activities, the respondents namely: RAYMOND TOMAROY, President,
ROEL SARDONIDOS, Vice-President, JOSEPH SEDERIO, Secretary, MARITCHU JAVELLANA, Treasurer,
ENRIQUE OMADTO, Auditor, EFREN MOGAR, P.R.O., and FRANCISCO BERTULFO, P.R.O. and Board of
Directors: JUDY ROQUERO, PATERNO SILVESTRE, CAYETANO PALMON, TEODORO OCOP and JOSEPH
ESTIFANO are hereby declared to have lost their employment status with the petitioner.14

The Labor Arbiter found that the continued decline in job prompted the respondent to implement a
reduced working day from the original six (6) days to three (3) days per week because of the continued
decrease of job orders, which further led to its decision to temporarily stop the operation in its Dyeing
and Finishing Division for one (1) week – March 12 to 17, 2001. The affected employees were then
requested to utilize their vacation leaves and were, thereafter, admitted back to work. However,
Tomaroy and members of the union staged a strike, and the labor unrest resulted in the cancellation of
job orders amounting to ₱6,380,817.50. The aforestated losses prompted the petitioner to close and
stop the business operations of its Dyeing and Finishing Division.

It is worthy to note that the whole company did not cease to operate and that it was only the workers in
the Dyeing and Finishing Division who were affected by the temporary lay-off. Thus, when the
respondents conducted a picket in front of the company’s premises, the whole business operations of
the respondent was affected. As borne out by the records, the Labor Arbiter found that the petitioners
therein failed to comply with the requirements for a valid strike, to wit:

1. It was not based on a valid factual ground, either based on Collective Bargaining Deadlock and/or
Unfair Labor Practice;

2. No notice of strike was filed with the National Conciliation and Mediation Board of the DOLE;

3. There was no strike-vote taken by the majority members of the union;

4. There was no strike-vote report submitted to the DOLE at least seven (7) days before the intended
date of the strike;

5. The cooling-off period prescribed by law was not observed; and

6. The 7-day visiting period after submission of the strike vote report was not fully observed.15

Thus, the Labor Arbiter ruled that the strike staged by the petitioner union was illegal; hence, the union
officers who knowingly participated in an illegal strike, already lost their employment status.16

Aggrieved, the petitioner union interposed an appeal before the NLRC, docketed as NLRC-CA-030216-01.
In a Resolution promulgated on May 10, 2002, the NLRC dismissed the appeal and affirmed the decision
of the Labor Arbiter:

WHEREFORE, in view of the foregoing, and finding no cogent reason to disturb the finding of the Labor
Arbiter a quo, the assailed decision is hereby AFFIRMED.17

The NLRC reasoned that it found no instances and/or situation befitting grave abuse of discretion on the
part of the Labor Arbiter.

Dissatisfied, the petitioner union filed a motion for reconsideration which was denied in a
Resolution18 dated July 24, 2002.

The petitioner union filed a petition for certiorari before the CA, docketed as CA-G.R. SP No. 73353,
raising the following error:
I. PUBLIC RESPONDENTS, THE HONORABLE LABOR ARBITER AND THE COMMISSIONERS OF THE
NATIONAL LABOR RELATIONS COMMISSION COMMITTED PATENT GRAVE ABUSED (SIC) OF DISCRETION
AMOUNTING TO LACK OR EXCESS OF JURISDICTION WHEN THEY FAILED TO APPRECIATE FACTS AND
EVIDENCES, APPLICABLE LAWS AND EXISTING JURISPRUDENCE AND, IF NOT CORRECTED, WOULD CAUSE
IRREPARABLE DAMAGE TO HEREIN RESPONDENTS.19

In a Resolution20 dated October 25, 2002, the CA dismissed the petition. The CA found that, contrary to
Section 3, Rule 46 of the 1997 Rules of Civil Procedure, the petition for certiorari filed by the petitioner
union did not contain the full names and actual addresses of all the petitioners and the respondents, as
the petition merely mentioned "BMC-SUPER, et al." as the petitioners. Further, the petition and the
certification on non-forum shopping were signed by Raymond P. Tomaroy, who claimed to be the union
president/authorized representative of petitioners without, however, any such authorization from the
labor union and the other petitioners covered by the abbreviation et al. Moreover, the petition was not
verified as required by Section 1, Rule 65 of the 1997 Rules of Civil Procedure; hence, did not produce
legal effect as provided for in Section 4, Rule 7 of the Rules of Court.

In addition, the petition was signed by petitioner Raymond P. Tomaroy in his capacity as union
president/authorized representative, assisted by Enrique T. Belarmino, Legal Head of Solidarity of
Unions in the Philippines for Empowerment and Reforms, neither of whom was a duly authorized
member of the Integrated Bar of the Philippines. Hence, according to the appellate court, neither of
them had authority to conduct litigation before the CA.21 A motion for reconsideration was filed by the
petitioner union which was similarly denied in a Resolution22 dated April 21, 2003. The CA reasoned that,
contrary to the petitioners’ insistence that the verification was signed by Raymond P. Tomaroy, page 16
of the petition filed before it did not bear such signature. Moreover, the special power of attorney
attached to the motion for reconsideration was subscribed and sworn to by the signatories therein
before Notary Public Orlando C. Dy only on November 20, 2002, i.e., more than one (1) month after the
filing of the petition on October 15, 2002. Consequently, the special power of attorney did not cure the
defect in the certification against forum shopping signed by Raymond Tomaroy, which was, likewise, not
accompanied by proof that he was authorized to file the petition on behalf of the petitioner union.

The CA clarified that the authority of non-lawyers to represent the labor organization or members
thereof applies only to proceedings before the NLRC or Labor Arbiters, as provided for in Article 222 of
the Labor Code. On the other hand, a non-lawyer may appear before it only if he is a party-litigant.
However, Raymond P. Tomaroy did not appear to be a party in the case before the CA as his name was
not mentioned in the caption nor in the body of the petition.23

Aggrieved, the petitioners filed the instant petition contending that:

PUBLIC RESPONDENT COURT OF APPEALS ERRED WHEN IT DISMISSED THE PETITIONERS’ APPEAL ON
GROUNDS OF TECHNICALITIES.

II

PUBLIC RESPONDENT NATIONAL LABOR RELATIONS COMMISSION ERRED [WHEN] IT AFFIRMED THE
FINDINGS OF THE HONORABLE LABOR ARBITER THAT PETITIONERS COMMITTED ILLEGAL STRIKE.24
On the first ground, the petitioners allege that they complied with Section 3, Rule 46 and Section 7, Rule
3 of the Rules of Court. They contend that the petition filed before the CA by the petitioner union’s
president was sanctioned by Article 242 of the Labor Code, and the cases of Liberty Manufacturing
Workers Union v. CFI of Bulacan,25 Davao Free Workers Front v. CIR,26 and La Carlota Sugar Central v.
CIR.27 The petitioner union insists that it would be illogical for the union, as an entity, to require all its
members to sign the said petition and the certificate of non-forum shopping. It avers that a labor union
is a judicial entity which functions thru its officers. Thus, the president, as an officer of the union, needed
no special power of attorney to sign for the union. It stresses that it did not violate Section 34, Rule 138
of the Rules of Court.

The petitioner union further invokes the policy that the "rules of technicality must yield to the broader
interest of substantial justice;" when the rules strictly applied resulting in technicalities that tend to
frustrate rather than promote justice, this Court is empowered to support the rules.

The petitioners argue that they did not stage a strike, much more an illegal strike. They explain that a
strike means work stoppage. Considering that the Dyeing and Finishing Division of the respondent was
shutdown, it could not have caused a work stoppage. The union members merely picketed in front of
the respondent’s factory to urge the respondent to open and order the resumption of the operations in
its Dyeing and Finishing Division. There was, thus, no need to comply with the requirements laid down
by Article 263 of the Labor Code and its implementing rules.

For its part, the respondent prayed that the petition be dismissed on the ground that the petition filed
before the CA failed to comply with Section 1 of Rule 65, Section 3 of Rule 46, and Section 7 of Rule 3 of
the Rules of Court, and that the requirement as to the signatories in the petition failed to comply with
Section 3, Rule 7 of the Rules of Court. The respondent reiterates that the petitioners staged an illegal
strike, and that as officers of the union who participated therein, the petitioners are deemed to have
lost their employment status.1awphi1.nét

The contention of the petitioners is erroneous. They are of the erroneous impression that the only
respondent in the NLRC was the petitioner union and that it was sued in its representative capacity. The
fact of the matter is that the respondent sued not only the petitioner union as respondent, but also its
officers and members of its Board of Directors as principal respondents, and sought the termination of
the employment of the said officers. The Labor Arbiter rendered judgment against all the respondents
therein and declared the officers to have lost their employment status. The NLRC affirmed the decision
on appeal. It was not only the union that assailed the decision of the NLRC in the CA, but also the
dismissed officers. The petitioners (respondents therein) prayed for the reversal thereof and that
another judgment be rendered as prayed for by them in their position paper in the NLRC, thus:

WHEREFORE, premises considered, it is respectfully prayed to this Honorable Labor Arbiter that, after
submission of this Position Paper, the above entitled case be considered submitted for resolution, and
the decision be rendered in favor of the respondents employees:

1. Declaring Petitioners guilty of illegal reduction of working days, shutdown and UNFAIR LABOR
PRACTICES against individual respondents;

2. Ordering petitioners be, jointly and severally, liable to pay respondents actual damages, payment of
MORAL and EXEMPLARY DAMAGES in the amount of not less than ₱50,000.00 each individual
employees and 10% of the total monetary award for the Office of BMC-SUPER plus ₱10,000.00 litigation
expenses;

3. Ordering that Petitioner Paul Lee be in contempt of court and be fined to pay individual respondents
in the amount of ₱50,000.00 each or imprisonment of Two (2) to Four (4) Years or both.

Other relief and remedies equitable in the premises are, likewise, prayed for.28

Under Section 3 of Rule 46 in relation to Section 1, Rule 65 of the Rules of Court, the petition for
certiorari shall contain the full names and actual addresses of all the petitioners and the respondents,
and that the failure of the petitioners to comply with the said requirement shall be sufficient ground for
the dismissal of their petition:

Sec. 3. Contents and filing of petition; effect of non-compliance with requirements. – The petition shall
contain the full names and actual addresses of all the petitioners and respondents, a concise statement
of the matters involved, the factual background of the case and the grounds relied upon for the relief
prayed for.

It shall be filed in seven (7) clearly legible copies together with proof of service thereof on the
respondent with the original copy intended for the court indicated as such by the petitioner, and shall
be accompanied by a clearly legible duplicate original or certified true copy of the judgment, order,
resolution, or ruling subject thereof, such material portions of the record as are referred to therein and
other documents relevant or pertinent thereto. The certification shall be accomplished by the proper
clerk of court or by his duly authorized representative, or by the proper officer of the court, tribunal,
agency or office involved or by his duly authorized representative. The other requisite number of copies
of the petition shall be accompanied by clearly legible plain copies of all documents attached to the
original.

The petitioner shall also submit together with the petition a sworn certification that he has not
theretofore commenced any other action involving the same issues in the Supreme Court, the Court of
Appeals, or different divisions thereof, or any other tribunal or agency; if there is such other action or
proceeding, he must state the status of the same; and if he should, thereafter, learn that a similar action
or proceeding has been filed or is pending before the Supreme Court, the Court of Appeals, or different
divisions thereof, or any other tribunal or agency, he undertakes to promptly inform the aforesaid courts
and other tribunal or agency thereof within five (5) days therefrom.

The petitioner shall pay the corresponding docket and other lawful fees to the clerk of court and deposit
the amount of ₱500.00 for costs at the time of the filing of the petition.

The failure of the petitioner to comply with any of the foregoing requirements shall be sufficient ground
for the dismissal of the petition.

Moreover, under Section 1, Rule 7 of the Rules of Court, the title of the action indicates the names of
the parties who shall be named in the original petition:

Section 1. Caption. – The caption sets forth the name of the court, the title of the action, and the docket
number, if assigned.
The title of the action indicates the names of the parties. They shall all be named in the original
complaint or petition; but in subsequent pleadings, it shall be sufficient if the name of the first party on
each side be stated with an appropriate indication when there are other parties.

Their respective participation in the case shall be indicated.

In this case, the title of the petition for certiorari filed in the CA does not contain the names of the
petitioners officers of the petitioner BMC-SUPER and of the members of the Board of Directors; even the
petition itself does not contain the full names and addresses of the said officers and members of the
Board of Directors of the petitioner union. We quote the title of the petition and the averments thereof
having reference to the parties-petitioners:

BUKLURAN NG MANGGAGAWA SA CLOTHMAN KNITTING CORPORATION – SOLIDARITY OF UNIONS IN

THE PHILIPPINES FOR EMPOWERMENT AND REFORMS (BMC-SUPER), ET AL.,Petitioner,

-vs-

CLOTHMAN KNITTING CORPORATION, Respondents.29

Petitioners, BUKLURAN NG MANGGAGAWA SA CLOTHMAN – SOLIDARITY OF UNIONS FOR

EMPOWERMENT AND REFORMS (BMC-SUPER), et al., is a legitimate labor organization with Charter
Certificate No. S-102, can be served with summons and other processes at 4th Floor Perlas Building, 646
Quezon Avenue, Quezon City.1awphi1.nét

Private Respondent, CLOTHMAN KNITTING CORPORATION, is a domestic corporation organized and

existing under and by virtue of Philippine Laws engaged in textile industry with principal place of
business at No. 57 Don Pedro Street, Don Pedro Village, Marulas, Valenzuela City.

Public Respondents, National Labor Relations Commission, Second Division, herein impleaded as the
tribunal exercising judicial functions who issued the assailed decision in NLRC Case No. 05-03332-2001.30

The petitioners’ reliance on the ruling of this Court in Davao Free Workers Front v. CIR31 is misplaced. In
the said case, the Court held that the failure to specify the details regarding the number and names of
the striking members of a labor union in the decision or in the complaint was of no consequence. This is
due to the fact that it was established that all the union members went on strike as a result of the unfair
labor practice of the employer, in consonance with the rule that it is precisely the function of a labor
union to carry the representation of its members, particularly against the employer’s unfair labor
practices against it and its members, and to file an action for their benefit and behalf without joining
each and every member as a separate party.

Significantly, the full names and addresses of the officers and members of the Board of Directors of the
petitioner union are set forth in their petition at bench; proof that, indeed, there is a need for the full
names and addresses of all the petitioners to be stated in the title of the petition and in the petition
itself. We quote the title of the petition and the allegation therein having reference to the parties-
petitioners:

BUKLURAN NG MANGGAGAWA SA CLOTHMAN KNITTING CORPORATION – SOLIDARITY OF UNIONS IN

THE PHILIPPINES FOR EMPOWERMENT AND REFORMS (BMC-SUPER), AND RAYMOND TOMAROY, ROEL
SARDONIDOS, JOSEPH SEDERIO, MARITCHU JAVELLANA, ENRIQUE OMADTO, EFREN MOGAR,
FRANCISCO BERTULFO, JUDY ROQUERO, PATERNO SILVESTRE, CAYETANO PALMON, TEODORO OCOP
AND JOSEPH ESTIFANO, Petitioners.32

1. Petitioners, BUKLURAN NG MANGGAGAWA SA CLOTHMAN – SOLIDARITY OF UNIONS FOR

EMPOWERMENT AND REFORMS (BMC-SUPER), ROEL SARDONIDOS, JOSEPH SEDERIO, MARITCHU
JAVELLANA, ENRIQUE OMADTO, EFREN MOGAR, FRANCISCO BERTULFO, JUDY ROQUERO, PATERNO
SILVESTRE, CAYETANO PALMON, TEODORO OCOP AND JOSEPH ESTIFANO, the former is a legitimate
labor organization with Charter Certificate No. S-102, and the latter are members of the former; they
can be served with summons and other processes of this Honorable Court at c/o H.O. VICTORIA AND
ASSOCIATES LAW OFFICES, Unit 305 Web-Jet Building, 64 Quezon Avenue cor. BMA Avenue, Quezon
City.33

On the other hand, Section 5, Rule 7 of the Rules of Court reads:

Sec. 5. Certification against forum shopping. – The plaintiff or principal party shall certify under oath in
the complaint or other initiatory pleading asserting a claim for relief, or in a sworn certification annexed
thereto and simultaneously filed therewith: (a) that he has not, therefore, commenced any action or
filed any claim involving the same issues in any court, tribunal or quasi-judicial agency and, to the best of
his knowledge, no such other action or claim is pending therein; (b) if there is such other pending action
or claim, a complete statement of the present status thereof; and (c) if he should, thereafter, learn that
the same or similar action or claim has been filed or is pending, he shall report that fact within five (5)
days therefrom to the court wherein his aforesaid complaint or initiatory pleading has been filed.

Failure to comply with the foregoing requirements shall not be curable by mere amendment of the
complaint or other initiatory pleading but shall be cause for the dismissal of the case without prejudice,
unless otherwise provided, upon motion and after hearing. The submission of a false certification or
non-compliance with any of the undertakings therein shall constitute indirect contempt of court,
without prejudice to the corresponding administrative and criminal actions. If the acts of the party or his
counsel clearly constitute willful and deliberate forum shopping, the same shall be ground for summary
dismissal with prejudice and shall constitute direct contempt, as well as a cause for administrative
sanctions.

As gleaned from the petition for certiorari in the CA, only the petitioner Raymond P. Tomaroy signed the
certification of non-forum shopping in his capacity as the president of the petitioner union. The officers
and members of the Board of Directors, who were, likewise, principal petitioners, did not execute any
certification of non-forum shopping as mandated by the said Rule. The rule is that the certification of
non-forum shopping must be signed by all the petitioners and that the signing by only one of them is
insufficient.34 Although petitioner Tomaroy was authorized by virtue of his position as president of the
petitioner union to execute the certification for and in its behalf, he had no authority to do so for and in
behalf of its petitioners-officers, as well as the members of the Board of Directors thereof. The execution
by the individual petitioners of a special power of attorney subsequent to the dismissal of the petition by
the CA authorizing petitioner Tomaroy to execute the requisite certification does not cure the fatal
defect in their petition.351awphi1.nét
The respondent alleges that the petition for certiorari filed before the CA was correctly dismissed as it
was not signed by counsel. The respondent noted that petitioner Tomaroy was not a lawyer and that
petitioner Enrique Belarmino did not manifest in the petition that he was the lawyer. The respondent,
thus, contends that Tomaroy and Belarmino engaged in the illegal practice of law, in violation of Section
34, Rule 138 of the Rules of Court.

We do not agree.

Section 3, Rule 7 of the Rules of Court provides that every pleading must be signed by the party or
counsel representing him.36 Considering that the union is one of the petitioners, Tomaroy, as its
president, may sign the pleading. For this reason alone, the CA cannot dismiss the petition.

Even if we glossed over the procedural lapses of the petitioners and resolved the petition on its merits,
we find that the petitioner union, along with its supporters, staged a strike without complying with the
requirements laid down in Article 263 of the Labor Code and its Implementing Rules.

The petitioner union alleges that it could not have staged a strike because the operations at the Dyeing
and Finishing Division were temporarily stopped. It insists that it merely protested the unjustified closing
of the respondent’s Dyeing and Finishing Division by forming a picket in front of the respondent’s
compound to urge the re-opening thereof.l^vvphi1.net

We do not agree.

A strike is any temporary stoppage of work by the concerted action of employees as a result of an
industrial or labor dispute.37 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.38

The members and the supporters of the petitioner union, headed by petitioner Tomaroy, thru concerted
action, caused a temporary stoppage of work as a result of an industrial dispute. This is evidenced in the
June 13, 2001 spot report of the Atlantic Security & Investigation Agency:

On or about 1445H of June 11, 2001, Mr. Jojo Flores and Mr. Rene Fabian were about to deliver fabrics
in Bulacan with service truck TBK-158. Upon reaching the corner of Don Pedro St. and McArthur
Highway, they gave way to a big truck turning to Don Pedro St. and at the same time the group of Mr.
Raymond Tomaroy, the leader of BUKLURAN NG MANGGAGAWA SA CLOTHMAN – SOLIDARITY OF
UNIONS IN THE PHILIPPINES FOR EMPOWERMENT AND REFORMS – BMC SUPER were on their way to
CKC compound. Seeing the group, Mr. Fabian greeted them by giving a quick forward motion of his
head. But instead, according to Mr. Fabian, Mr. Tomaroy with finger pointing on to Mr. Fabian accusing
him as the one responsible for the delay of their 13th month pay. Mr. Fabian just told the group BMC-
SUPER to read the Memorandum of the HRD dated June 8, 2001. Mr. Flores and Mr. Fabian returned to
CKC, Don Pedro St., Marulas, Valenzuela, to report the matter.

At about 1517H of same date, Mr. Tomaroy with 16 members of BMC SUPER staged a rally and/or
gathered in front of Clothman Knitting Corporation gate carrying placards with slogan read as follows:

1. Itigil ang sabwatan ng KATIPUNAN (FABIAN GROUP) at management BMC-SUPER;

2. Mr. Paul Lee – Huwag mong ipitin ang mid-year, 13th month pay ng mga manggagawa sa CKC. BMC-
SUPER;

3. Ibalik ang pasok sa Finishing Department;

4. Mr. Paul Lee – Magagara ang sasakyan mo, Montero, BMW, Pajero pero kaunting benepisyo ng
manggagawa ay di mo maibigay BMC-SUPER;

5. Kilalanin ang karapatan ng manggagawa na magtatag ng unyon BMC-SUPER.

On or about 1640H at the same date, a PNP-Valenzuela Mobil car had SPO1 Palma, PO2 Manresa and
PO1 Isip on board. The police with the BMC-SUPER.

The Valenzuela Police left at about 1727H.

At about 1810H of the same date, the group of BMC-SUPER abandoned the area.39

The subsequent Reports dated June 14, 15, 16 and 18, 2001 of the same agency further stated that
members of the petitioner union, along with other employees particularly from the knitting department,
joined in the picket.40 It is, thus, apparent that the concerted effort of the members of the petitioner
union and its supporters caused a temporary work stoppage. The allegation that there can be no work
stoppage because the operation in the Dyeing and Finishing Division had been shutdown is of no
consequence. It bears stressing that the other divisions were fully operational. There is nothing on
record showing that the union members and the supporters who formed a picket line in front of the
respondent’s compound were assigned to the finishing department. As can be clearly inferred from the
spot reports, employees from the knitting department also joined in picket. The blockade of the delivery
of trucks and the attendance of employees from the other departments of the respondent meant work
stoppage. The placards that the picketers caused to be displayed arose from matters concerning terms
or conditions of employment as well as the association or representation of persons in negotiating,
fixing, maintaining, changing or arranging the terms and conditions of employment.

Clearly, the petitioner union, its officers, members and supporters staged a strike.l^vvphi1.net In order
for a strike to be valid, the following requirements laid down in paragraphs (c) and (f) of Article 263 of
the Labor Code must be complied with: (a) a notice of strike must be filed; (b) a strike-vote must be
taken; and (c) the results of the strike-vote must be reported to the DOLE.41 It bears stressing that these
requirements are mandatory, meaning, non-compliance therewith makes the strike illegal. The evident
intention of the law in requiring the strike notice and strike-vote report is to reasonably regulate the
right to strike, which is essential to the attainment of legitimate policy objectives embodied in the law.42

Considering that the petitioner union failed to comply with the aforesaid requirements, the strike staged
on June 11 to 18, 2001 is illegal. Consequently, the officers of the union who participated therein are
deemed to have lost their employment status.43

IN LIGHT OF ALL THE FOREGOING, the petition is DENIED. The Resolutions of the Court of Appeals in CA-
G.R. SP No. 73353 are AFFIRMED. No costs.

SO ORDERED.
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.
DECISION

CALLEJO, SR.,  J.:

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.1awphi1.net In fine, they are part and parcel of the continuous process of grievance
resolution 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.

G.R. No. 91980             June 27, 1991

ILAW AT BUKLOD NG MANGGAGAWA (IBM), petitioner,

vs.
NATIONAL LABOR RELATIONS COMMISSION (First Division), HON. CARMEN TALUSAN and SAN
MIGUEL CORPORATION, respondents.

Banzuela, Flores, Miralles, Raneses, Sy, Taquio & Associates for petitioner.
Jardeleza Law Offices for private respondents.
NARVASA, J.:

The controversy at bar had its origin in the "wage distortions" affecting the employees of respondent
San Miguel Corporation allegedly caused by Republic Act No. 6727, otherwise known as the Wage
Rationalization Act.

Upon the effectivity of the Act on June 5, 1989, the union known as "Ilaw at Buklod Ng Manggagawa
(IBM)" — said to represent 4,500 employees of San Miguel Corporation, more or less, "working at the
various plants, offices, and warehouses located at the National Capital Region" — presented to the
company a "demand" for correction of the "significant distortion in . . . (the workers') wages." In that
"demand," the Union explicitly invoked Section 4 (d) of RA 6727 which reads as follows:

x x x           x x x          x x x

(d) . . .

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

It shall be mandatory for the NLRC to conduct continuous hearings and decide any dispute arising under
this Section within twenty (20) calendar days from the time said dispute is formally submitted to it for
arbitration. The pendency of a dispute arising from a wage distortion shall not in any way delay the
applicability of the increase in the wage rates prescribed under this Section.

But the Union claims that "demand was ignored:1

The . . . COMPANY ignored said demand by offering a measly across-the-board wage increase of P7.00
per day, per employee, as against the proposal of the UNION of P25.00 per day, per employee. Later,
the UNION reduced its proposal to P15.00 per day, per employee by way of amicable settlement.

When the . . . COMPANY rejected the reduced proposal of the UNION the members thereof, on their
own accord, refused to render overtime services, most especially at the Beer Bottling Plants at Polo,
starting October 16, 1989.

In this connection, the workers involved issues a joint notice reading as follows:2

SAMA-SAMANG PAHAYAG: KAMING ARAWANG MANGGAGAWA NG POLO BREWERY PAWANG KASAPI

NG ILAW AT BUKLOD NG MANGGAGAWA (IBM) AY NAGKAISANG NAGPASYA NA IPATUPAD MUNA ANG
EIGHT HOURS WORK SHIFT PANSAMANTALA HABANG HINDI IPINATUTUPAD NG SMC MANAGEMENT
ANG TAMANG WAGE DISTORTION.

The Union's position (set out in the petition subsequently filed in this Court, infra) was that the workers'
refuse "to work beyond eight (8) hours everyday starting October 16, 1989" as a legitimate means of
compelling SMC to correct "the distortion in their wages brought about by the implementation of the
said laws (R.A. 6640 and R.A. 6727) to newly-hired employees.3 That decision to observe the "eight
hours work shift" was implemented on October 16, 1989 by "some 800 daily-paid workers at the Polo
Plant's production line (of San Miguel Corporation [hereafter, simply SMC]) joined by others at statistical
quality control and warehouse, all members of . . . IBM . . . "4 There ensued thereby a change in the work
schedule which had been observed by daily-paid workers at the Polo Plant for the past five (5) years, i.e.,
"ten (10) hours for the first shift and ten (10) to fourteen (14) hours for the second shift, from Mondays
to Fridays . . ; (and on) Saturdays, . . eight (8) hours for both shifts" — a work schedule which, SMC says,
the workers had "welcomed, and encouraged" because the automatic overtime built into the schedule
"gave them a steady source of extra-income," and pursuant to which it (SMC) "planned its production
targets and budgets.5

This abandonment of the long-standing schedule of work and the reversion to the eight-hour shift
apparently caused substantial losses to SMC. Its claim is that there ensued "from 16 October 1989 to 30
November 1989 alone . . work disruption and lower efficiency . . (resulting in turn, in) lost production of
2,004,105 cases of beer . . ; that (i)n "money terms, SMC lost P174,657,598 in sales and P48,904,311 in
revenues . . (and the) Government lost excise tax revenue of P42 million, computed at the rate of P21
per case collectible at the plant.6 These losses occurred despite such measures taken by SMC as
organizing "a third shift composed of regular employees and some contractuals," and appeals "to the
Union members, through letters and memoranda and dialogues with their plant delegates and shop
stewards," to adhere to the existing work schedule.

Thereafter, on October 18, 1989, SMC filed with the Arbitration Branch of the National Labor Relations
Commission a complaint against the Union and its members "to declare the strike or slowdown illegal"
and to terminate the employment of the union officers and shop stewards. The complaint was docketed
as NLRC-NCR Case No. 00-10-04917.7

Then on December 8, 1989, on the claim that its action in the Arbitration Branch had as yet "yielded no
relief," SMC filed another complaint against the Union and members thereof, this time directly with the
National labor Relations Commission, "to enjoin and restrain illegal slowdown and for damages, with
prayer for the issuance of a cease-and-desist and temporary restraining order.8 Before acting on the
application for restraining order, the NLRC's First Division first directed SMC to present evidence in
support of the application before a commissioner, Labor Arbiter Carmen Talusan. On December 19,
1989, said First Division promulgated a Resolution on the basis of "the allegations of the petitioner
(SMC) and the evidence adduced ex parte in support of their petition." The Resolution —

1) authorized the issuance of "a Temporary Restraining Order for a period of twenty (20) days . . upon . .
a cash or surety bond in the amount of P50,000.00 . . . DIRECTING the respondents to CEASE and DESIST
from further committing the acts complained about particularly their not complying with the work
schedule established and implemented by the company through the years or at the least since 1984,
which schedule appears to have been adhered to by the respondents until October 16, 1989 . . .;

2) set the incident on injunction for hearing before Labor Arbiter Carmen Talusan on 27 December
1989 . . .

The Labor Arbiter accordingly scheduled the incident for hearing on various dates: December 27 and
29,1989, January 8, 11, 16, and 19, 1990. The first two settings were cancelled on account of the
unavailability of the Union's counsel. The hearing on January 8, 1990 was postponed also at the instance
of said counsel who declared that the Union refused to recognize the NLRC's jurisdiction. The hearings
set on January 11, 16 and 19, 1990 were taken up with the cross-examination of SMC's witness on the
basis of his affidavit and supplemental affidavits. The Union thereafter asked the Hearing Officer to
schedule other hearings. SMC objected. The Hearing Officer announced she would submit a report to
the Commission relative to the extension of the temporary restraining order of December 9,
1989, supra, prayed for by SMC. Here the matter rested until February 14, 1990, when the Union filed
the petition which commenced the special civil action of certiorari and prohibition at bar.9

In its petition, the Union asserted that:

1) the "central issue . . is the application of the Eight-Hour Labor Law . . . (i.e.) (m)ay an employer force
an employee to work everyday beyond eight hours a day?

2) although the work schedule adopted by SMC with built-in automatic overtime,10 "tremendously
increased its production of beer at lesser cost," SMC had been paying its workers "wages far below the
productivity per employee," and turning a deaf ear to the Union's demands for wage increases;

3) the NLRC had issued the temporary restraining order of December 19, 1989 "with indecent haste,
based on ex parte evidence of SMC and such an order had the effect of "forcing the workers to work
beyond eight (8) hours a day, everyday!!

4) the members of the NLRC had no authority to act as Commissioners because their appointments had
not been confirmed by the Commission on Appointment; and

5) even assuming the contrary, the NLRC, as an essentially appellate body, had no jurisdiction to act on
the plea for injunction in the first instance.

The petition thus prayed:

1) for judgment (a) annulling the Resolution of December 19, 1990; (b) declaring mandatory the
confirmation by the Commission on Appointments of the appointments of National Labor Relations
Commissioners; and (c) ordering the removal "from the 201 files of employees any and all memoranda
or disciplinary action issued/imposed to the latter by reason of their refusal to render overtime work;"
and

2) pending such judgment restraining(a) the NLR Commissioners "from discharging their power and
authority under R.A. 6715 prior to their re-appointment and/or confirmation;" as well as (b) Arbiter
Talusan and the Commission from acting on the matter or rendering a decision or issuing a permanent
injunction therein, or otherwise implementing said Resolution of December 19, 1989.

In traverse of the petition, SMC filed a pleading entitled "Comment with Motion to Admit Comment as
Counter-Petition," in which it contended that:

1) the workers' abandonment of the regular work schedule and their deliberate and wilful reduction of
the Polo plant's production efficiency is a slowdown, which is an illegal and unprotected concerted
activity;

2) against such a slowdown, the NLRC has jurisdiction to issue injunctive relief in the first instance;

3) indeed, the NLRC has "the positive legal duty and statutory obligation to enjoin the slowdown
complained of and to compel the parties to arbitrate . ., (and) to effectuate the important national policy
of peaceful settlement of labor disputes through arbitration;" accordingly, said NLRC "had no legal
choice but to issue injunction to enforce the reciprocal no lockout-no slowdown and mandatory
arbitration agreement of the parties;" and

4) the NLRC "gravely abused its discretion when it refused to decide the application for injunction within
the twenty day period of its temporary restraining order, in violation of its own rules and the repeated
decisions of this . . . Court.

It is SMC's submittal that the coordinated reduction by the Union's members of the work time
theretofore willingly and consistently observed by them, thereby causing financial losses to the
employer in order to compel it to yield to the demand for correction of "wage distortions," is an illegal
and "unprotected" activity. It is, SMC argues, contrary to the law and to the collective bargaining
agreement between it and the Union. The argument is correct and will be sustained.

Among the rights guaranteed to employees by the Labor Code is that of engaging in concerted activities
in order to attain their legitimate objectives. Article 263 of the Labor Code, as amended, declares that in
line with "the policy of the State to encourage free trade unionism and free collective bargaining, . .
(w)orkers shall have the right to engage in concerted activities for purposes of collective bargaining or
for their mutual benefit and protection." A similar right to engage in concerted activities for mutual
benefit and protection is tacitly and traditionally recognized in respect of employers.

The more common of these concerted activities as far as employees are concerned are: strikes — the
temporary stoppage of work as a result of an industrial or labor dispute; picketing — the marching to
and fro at the employer's premises, usually accompanied by the display of placards and other signs
making known the facts involved in a labor dispute; and boycotts — the concerted refusal to patronize
an employer's goods or services and to persuade others to a like refusal. On the other hand, the
counterpart activity that management may licitly undertake is the lockout — the temporary refusal to
furnish work on account of a labor dispute, In this connection, the same Article 263 provides that the
"right of legitimate labor organizations to strike and picket and of employer to lockout, consistent with
the national interest, shall continue to be recognized and respected." The legality of these activities is
usually dependent on the legality of the purposes sought to be attained and the means employed
therefor.

It goes without saying that these joint or coordinated activities may be forbidden or restricted by law or
contract. In the particular instance of "distortions of the wage structure within an establishment"
resulting from "the application of any prescribed wage increase by virtue of a law or wage order,"
Section 3 of Republic Act No. 6727 prescribes a specific, detailed and comprehensive procedure for the
correction thereof, thereby implicitly excluding strikes or lockouts or other concerted activities as modes
of settlement of the issue. The provision11 states that —

. . . the employer and the union shall negotiate to correct the distort-ions. Any dispute arising from wage
distortions shall be resolved through the grievance procedure under their collective bargaining
agreement and, if it remains unresolved, through voluntary arbitration. Unless otherwise agreed by the
parties in writing, such dispute shall be decided by the voluntary arbitrator or panel of voluntary
arbitrators within ten (10) calendar days from the time said dispute was referred to voluntary
arbitration.
In cases where there are no collective agreements or recognized labor unions, the employers and
workers shall endeavor to correct such distortions. Any dispute arising therefrom shall be settled
through the National Conciliation and Mediation Board and, if it remains unresolved after ten (10)
calendar days of conciliation, shall be referred to the appropriate branch of the National Labor Relations
Commission (NLRC). It shall be mandatory for the NLRC to conduct continuous hearings and decide the
dispute within twenty (20) calendar days from the time said dispute is submitted for compulsory
arbitration.

The pendency of a dispute arising from a wage distortion shall not in any way delay the applicability of
any increase in prescribed wage rates pursuant to the provisions of law or Wage Order.

x x x           x x x          x x x

The legislative intent that solution of the problem of wage distortions shall be sought by voluntary
negotiation or abitration, and not by strikes, lockouts, or other concerted activities of the employees or
management, is made clear in the rules implementing RA 6727 issued by the Secretary of Labor and
Employment12 pursuant to the authority granted by Section 13 of the Act.13 Section 16, Chapter I of
these implementing rules, after reiterating the policy that wage distortions be first settled voluntarily by
the parties and eventually by compulsory arbitration, declares that, "Any issue involving wage distortion
shall not be a ground for a strike/lockout."

Moreover, the collective bargaining agreement between the SMC and the Union, relevant provisions of
which are quoted by the former without the latter's demurring to the accuracy of the quotation,14 also
prescribes a similar eschewal of strikes or other similar or related concerted activities as a mode of
resolving disputes or controversies, generally, said agreement clearly stating that settlement of "all
disputes, disagreements or controversies of any kind" should be achieved by the stipulated grievance
procedure and ultimately by arbitration. The provisions are as follows:

Section 1. Any and all disputes, disagreements and controversies of any kind between the COMPANY
and the UNION and/or the workers involving or relating to wages, hours of work, conditions of
employment and/or employer-employee relations arising during the effectivity of this Agreement or any
renewal thereof, shall be settled by arbitration in accordance with the procedure set out in this Article.
No dispute, disagreement or controversy which may be submitted to the grievance procedure in Article
IX shall be presented for arbitration unless all the steps of the grievance procedure are exhausted
(Article V — Arbitration).

Section 1. The UNION agrees that there shall be no strikes, walkouts, stoppage or slowdown of work,
boycotts, secondary boycotts, refusal to handle any merchandise, picketing, sit-down strikes of any kind,
sympathetic or general strikes, or any other interference with any of the operations of the COMPANY
during the terms of this agreement (Article VI).

The Union was thus prohibited to declare and hold a strike or otherwise engage in non-peaceful
concerted activities for the settlement of its controversy with SMC in respect of wage distortions, or for
that matter; any other issue "involving or relating to wages, hours of work, conditions of employment
and/or employer-employee relations." The partial strike or concerted refusal by the Union members to
follow the five-year-old work schedule which they had therefore been observing, resorted to as a means
of coercing correction of "wage distortions," was therefore forbidden by law and contract and, on this
account, illegal.

Awareness by the Union of the proscribed character of its members' collective activities, is clearly
connoted by its attempt to justify those activities as a means of protesting and obtaining redress against
said members working overtime every day from Monday to Friday (on an average of 12 hours), and
every Saturday (on 8 hour shifts),15 rather than as a measure to bring about rectification of the wage
distortions caused by RA 6727 — which was the real cause of its differences with SMC. By concealing the
real cause of their dispute with management (alleged failure of correction of wage distortion), and trying
to make it appear that the controversy involved application of the eight-hour labor law, they obviously
hoped to remove their case from the operation of the rules implementing RA 6727 that "Any issue
involving wage distortion shall not be a ground for a strike/lockout." The stratagem cannot succeed.

In the first place, that it was indeed the wage distortion issue that principally motivated the Union's
partial or limited strike is clear from the facts, The work schedule (with "built-in overtime") had not been
forced upon the workers; it had been agreed upon between SMC and its workers at the Polo Plant and
indeed, had been religiously followed with mutually beneficial results for the past five (5) years. Hence,
it could not be considered a matter of such great prejudice to the workers as to give rise to a
controversy between them and management. Furthermore, the workers never asked, nor were there
ever any negotiations at their instance, for a change in that work schedule prior to the strike. What
really bothered them, and was in fact the subject of talks between their representatives and
management, was the "wage distortion" question, a fact made even more apparent by the joint notice
circulated by them prior to the strike, i.e., that they would adopt the eight-hour work shift in the
meantime pending correction by management of the wage distortion (IPATUPAD MUNA ANG EIGHT
HOURS WORK SHIFT PANSAMANTALA HABANG HINDI IPINATUTUPAD NG SMC MANAGEMENT ANG
TAMANG WAGE DISTORTION).

In the second place, even if there were no such legal prohibition, and even assuming the controversy
really did not involve the wage distortions caused by RA 6727, the concerted activity in question would
still be illicit because contrary to the workers' explicit contractual commitment "that there shall be no
strikes, walkouts, stoppage or slowdown of work, boycotts, secondary boycotts, refusal to handle any
merchandise, picketing, sit-down strikes of any kind, sympathetic or general strikes, or any other
interference with any of the operations of the COMPANY during the term of . . . (their collective
bargaining) agreement.16

What has just been said makes unnecessary resolution of SMC's argument that the workers' concerted
refusal to adhere to the work schedule in force for the last several years, is a slowdown, an inherently
illegal activity essentially illegal even in the absence of a no-strike clause in a collective bargaining
contract, or statute or rule. The Court is in substantial agreement with the petitioner's concept of a
slowdown as a "strike on the installment plan;" as a wilfull reduction in the rate of work by concerted
action of workers for the purpose of restricting the output of the employer, in relation to a labor
dispute; as an activity by which workers, without a complete stoppage of work, retard production or
their performance of duties and functions to compel management to grant their demands.17 The Court
also agrees that such a slowdown is generally condemned as inherently illicit and unjustifiable, because
while the employees "continue to work and remain at their positions and accept the wages paid to
them," they at the same time "select what part of their allotted tasks they care to perform of their own
volition or refuse openly or secretly, to the employer's damage, to do other work;" in other words, they
"work on their own terms.18 But whether or not the workers' activity in question — their concerted
adoption of a different work schedule than that prescribed by management and adhered to for several
years — constitutes a slowdown need not, as already stated, be gone into. Suffice it to say that activity is
contrary to the law, RA 6727, and the parties' collective bargaining agreement.

The Union's claim that the restraining order is void because issued by Commissioners whose
appointments had not been duly confirmed by the Commission on Appointments should be as it is
hereby given short shift, for, as the Solicitor General points out, it is an admitted fact that the members
of the respondent Commission were actually appointed by the President of the Philippines on
November 18, 1989; there is no evidence whatever in support of the Union's bare allegation that the
appointments of said members had not been confirmed; and the familiar presumption of regularity in
appointment and in performance of official duty exists in their favor.19

Also untenable is the Union's other argument that the respondent NLRC Division had no jurisdiction to
issue the temporary restraining order or otherwise grant the preliminary injunction prayed for by SMC
and that, even assuming the contrary, the restraining order had been improperly issued. The Court finds
that the respondent Commission had acted entirely in accord with applicable provisions of the Labor
Code.

Article 254 of the Code provides that "No temporary or permanent injunction or restraining order in any
case involving or growing out of labor disputes shall be issued by any court or other entity, except as
otherwise provided in Articles 218 and 264 . . ." Article 264 lists down specific "prohibited activities"
which may be forbidden or stopped by a restraining order or injunction. Article 218 inter
alia enumerates the powers of the National Labor Relations Commission and lays down the conditions
under which a restraining order or preliminary injunction may issue, and the procedure to be followed in
issuing the same.

Among the powers expressly conferred on the Commission by Article 218 is the power to "enjoin or
restrain any actual or threatened commission of any or all prohibited or unlawful acts or to require the
performance of a particular act in any labor dispute which, if not restrained or performed forthwith,
may cause grave or irreparable damage to any party or render ineffectual any decision in favor of such
party . . ."

As a rule such restraining orders or injunctions do not issue ex parte, but only after compliance with the
following requisites, to wit:

a) a hearing held "after due and personal notice thereof has been served, in such manner as the
Commission shall direct, to all known persons against whom relief is sought, and also to the Chief
Executive and other public officials of the province or city within which the unlawful acts have been
threatened or committed charged with the duty to protect complainant's property;"

b) reception at the hearing of "testimony of witnesses, with opportunity for cross-examination, in

support of the allegations of a complaint made under oath," as well as "testimony in opposition thereto,
if offered . . .;

c) a finding of fact by the Commission, to the effect:

(1) That prohibited or unlawful acts have been threatened and will be committed and will be continued
unless restrained, but no injunction or temporary restraining order shall be issued on account of any
threat, prohibited or unlawful act, except against the person or persons, association or organization
making the threat or committing the prohibited or unlawful act or actually authorizing or ratifying the
same after actual knowledge thereof;

(2) That substantial and irreparable injury to complainant's property will follow;

(3) That as to each item of relief to be granted, greater injury will be inflicted upon complainant by the
denial of relief than will be inflicted upon defendants by the granting of relief;

(4) That complainant has no adequate remedy at law; and

(5) That the public officers charged with the duty to protect complainant's property are unable or
unwilling to furnish adequate protection.

However, a temporary restraining order may be issued ex parte under the following conditions:

a) the complainant "shall also allege that, unless a temporary restraining order shall be issued without
notice, a substantial and irreparable injury to complainant's property will be unavoidable;

b) there is "testimony under oath, sufficient, if sustained, to justify the Commission in issuing a
temporary injunction upon hearing after notice;"

c) the "complainant shall first file an undertaking with adequate security in an amount to be fixed by the
Commission sufficient to recompense those enjoined for any loss, expense or damage caused by the
improvident or erroneous issuance of such order or injunction, including all reasonable costs, together
with a reasonable attorney's fee, and expense of defense against the order or against the granting of any
injunctive relief sought in the same proceeding and subsequently denied by the Commission;" and

d) the "temporary restraining order shall be effective for no longer than twenty (20) days and shall
become void at the expiration of said twenty (20) days.

The reception of evidence "for the application of a writ of injunction may be delegated by the
Commission to any of its Labor Arbiters who shall conduct such hearings in such places as he may
determine to be accessible to the parties and their witnesses and shall submit thereafter his
recommendation to the Commission."

The record reveals that the Commission exercised the power directly and plainly granted to it by sub-
paragraph (e) Article 217 in relation to Article 254 of the Code, and that it faithfully observed the
procedure and complied with the conditions for the exercise of that power prescribed in said sub-
paragraph (e) It acted on SMC's application for immediate issuance of a temporary restraining order ex
parte on the ground that substantial and irreparable injury to its property would transpire before the
matter could be heard on notice; it, however, first direct SMC Labor Arbiter Carmen Talusan to receive
SMC's testimonial evidence in support of the application and thereafter submit her recommendation
thereon; it found SMC's evidence adequate and issued the temporary restraining order upon
bond.1âwphi1 No irregularity may thus be imputed to the respondent Commission in the issuance of
that order.
In any event, the temporary restraining order had a lifetime of only twenty (20) days and became
void ipso facto at the expired ration of that period.

In view of the foregoing factual and legal considerations, all irresistibly leading to the basic conclusion
that the concerted acts of the members of petitioner Union in question are violative of the law and their
formal agreement with the employer, the latter's submittal, in its counter-petition that there was, in the
premises, a "legal duty and obligation" on the part of the respondent Commission "to enjoin the
unlawful and prohibited acts and omissions of petitioner IBM and the workers complained of,20 — a
proposition with which, it must be said, the Office of the Solicitor General concurs, asserting that the
"failure of the respondent commission to resolve the application for a writ of injunction is an abuse of
discretion especially in the light of the fact that the restraining order it earlier issued had already
expired"21 — must perforce be conceded.

WHEREFORE, the petition is DENIED, the counter-petition is GRANTED, and the case is REMANDED to
the respondent Commission (First Division) with instructions to immediately take such action thereon as
is indicated by and is otherwise in accord with, the findings and conclusions herein set forth. Costs
against petitioner.

IT IS SO ORDERED.

Adams Dairy v. Burke

Annotate this Case

293 S.W.2d 281 (1956)

ADAMS DAIRY, Inc., a corporation, Appellant, v. Patrick J. BURKE, Reed J. White, Charles Speickerman,
Thomas Conroy, Walter Bush, Robert A. Stewart and Fackney L. Smith, individually and as officers and
members of Milk Wagon Drivers and Inside Dairy Employees, Union Local 603, affiliated with
International Brotherhood of Teamsters, Chauffeurs, Warehousemen and Helpers of America, AFL and
as representatives of the class consisting of the members of Milk Wagon Drivers and Inside Dairy
Employees, Union Local 603, affiliated with International Brotherhood of Teamsters, Chauffeurs,
Warehousemen and Helpers of America, AFL, and Local 603, Milk Wagon Drivers and Inside Dairy
Employees Union, affiliated with the International Brotherhood of Teamsters, Chauffeurs,
Warehousemen and Helpers of America, AFL, and John Doe and Richard Roe, and Maury E. Rubin, doing
business as St. Louis Labor Tribune, Respondents.

No. 44965.

Supreme Court of Missouri. Division No. 2.

July 9, 1956.

Motion for Rehearing or to Transfer to Denied September 10, 1956.

*283 J. Leonard Schermer, Elmer Price, St. Louis, for plaintiff-appellant.

Harry H. Craig, Norman W. Armbruster, St. Louis, for respondents, Wiley, Craig, Armbruster, Schmidt &
Wilburn, St. Louis, of counsel.

Motion for Rehearing or to Transfer to Court en Banc Denied September 10, 1956.

STOCKARD, Commissioner.

This suit was filed in the Circuit Court of St. Louis County, Missouri, by plaintiff, a corporation engaged in
processing milk and selling the milk and milk products exclusively at wholesale to retail stores in the St.
Louis area, to enjoin certain acts of *284 the defendants alleged to constitute an illegal conspiracy
designed to injure and destroy its business, and for damages alleged to have been caused to its business
by such acts.

The defendants, except Maury Rubin, are members, officers and agents of Local 603, Milk Wagon
Drivers and Inside Dairy Employees Union affiliated with the International Brotherhood of Teamsters,
Chauffeurs, Warehousemen and Helpers of America, AFL. The action is brought against Local 603 and
the above named defendants individually and as a class. Maury Rubin is the sole owner and publisher of
a weekly newspaper published in St. Louis known as the St. Louis Labor Tribune.

The parties agreed to try together the issues on both the temporary and permanent injunction, and it
was stipulated that the portion of plaintiff's petition relating to damages would be reserved for later
hearing. At the conclusion of the evidence the trial court dismissed "so much of plaintiff's petition as
seeks equitable relief" and plaintiff has appealed. Our appellate jurisdiction is invoked on the ground
that constitutional questions are involved under the First and Fourteenth Amendments of the United
States Constitution, and Missouri Constitution of 1945, Article I, section 29, V.A.M.S.

Plaintiff's employees may be divided into three groups: (1) inside workers and clerical employees, (2) ice
cream wagon drivers, and (3) milk wagon drivers. From the time plaintiff entered business in the St.
Louis area and until July 1954, Local 603 was the recognized collective bargaining representative for
each of the three groups, and plaintiff and Local 603 had a contractual relationship covering each group.
In 1954 plaintiff and Local 603 entered into contracts for the first two groups named above, but some of
the employees in group 3 formed an organization known as the "Independent Wholesale Dairy Products
Salesmens Association," hereafter referred to as the "independent union" which submitted a petition to
the National Labor Relations Board, hereafter referred to as "N.L.R.B.," requesting certification. The
N.L.R.B. conducted an election, to which Local 603 and plaintiff consented, and the independent union
was selected by a majority of the employees in group 3. Immediately after the result of the election was
known, Local 603 filed charges with the N.L.R.B. alleging that plaintiff had engaged in unfair labor
practices in violation of Section 8(a) of the Labor Management Relations Act, 1947, 29 U.S.C.A. § 141 et
seq., hereafter referred to as the "federal Act," in that it had coerced and intimidated its employees to
support the independent union. These charges were subsequently dismissed by the N.L.R.B. after being
"carefully investigated and considered" for the reason that there was "insufficient evidence of
violations." The N.L.R.B. certified the independent union as the exclusive collective bargaining
representative for all the employees in group 3 and plaintiff entered into a contract with that union.

The defendants pleaded, and at the hearing the officers of Local 603 testified, that the certification by
the N.L.R.B. of the independent union is not being challenged, that Local 603 does not claim to
represent plaintiff's employees in group 3 for any purpose, that since the certification it has not
requested or demanded of anyone that Local 603 be recognized as the collective bargaining
representative for said employees, and further that the defendants have not requested or demanded of
plaintiff, or anyone else, that plaintiff's employees in group 3 be coerced into joining Local Union 603.

A short time after the above mentioned certification by the N.L.R.B. of the independent union, the
executive board of Local 603 authorized and directed the distribution by members of the union of
pamphlets worded as follows:

"Do Not Buy Adams Dairy Company Products When You Patronize This Store

This Is Why

"The Dairies of Metropolitan St. Louis listed on the reverse side of this pamphlet are the finest in the
world and some of them *285 supply this store with their products. Those Dairies employ members of
our Union for the delivery of their products and grant our members good wages, hours and working
conditions. We are anxious to advertise this fact to the public and to urge the people of the St. Louis
area to favor those Dairies with their business.

"There is nothing wrong with the products of the Adams Dairy Company. Our only reason for asking you
to refrain from purchasing them is that we want to see the Dairies who employ our drivers get the
business. This will not only help the Dairies of Metropolitan St. Louis who employ our drivers but will
also be of assistance to the cause of the American Federation of Labor (AFL) and the Congress of
Industrial Organization (CIO). "Permit us to make it clear that We Are Not Picketing This Store and Have
No Dispute With It. Continue to patronize this store as you have in the past. We merely urge you to
refrain from purchasing the products of Adams Dairy Company when you do business here. "Milk
Wagon Drivers, Inside Dairy Workers Local Union 603 I.B. of T.C.W. & H. of A."

On the back of each pamphlet was a list of all the dairies in the St. Louis area except plaintiff. These
pamphlets were distributed to other unions in the St. Louis area, and Local Union 603 caused its
members to distribute the pamphlets at approximately sixty different retail grocery stores in the St.
Louis area by handing them to members of the general public as the public was about to enter the
stores. Maury Rubin made a statement in the Labor Tribune that over one-half million copies of the
pamphlets had been distributed.

Defendant Patrick J. Burke, who was referred to as the "head man" of Local 603 and who is its Secretary-
Treasurer and a member of its executive board, admitted that the purpose of distributing the pamphlets
was "to get the public not to buy Adams Dairy products;" "to get the public to buy milk from people
under contract with Local 603;" that the pamphlets were aimed to convey the message "do not buy
Adams milk;" and were intended to create an agreement among the membership of Local 603 and to
urge others not to buy Adams milk. The following answers given by Mr. Burke are typical:

"Q. So the purpose of this circular [pamphlet] was to limit their sales and take that business away from
them? A. To take the business over to other companies, yes, who employ and negotiate wages with us. *
* * "Q. Mr. Burke, the last sentence on this pamphlet or circular says, (reading): `We merely urge you to
refrain from purchasing the products of Adams Dairy Company when you do business here.' A. Yes. "Q.
Then you are trying to stop the sales in this store, is that correct? A. No.

"Q. Of Adams milk? A. That's correct."

Defendants pleaded in their return to the order to show cause, and the evidence established, that with
the exception of plaintiff's milk wagon drivers, all drivers of all the dairies in the St. Louis area are
members of Local 603, and that all of said drivers are governed as to wages and working conditions by
an identical industry wide contract. As a justification for the distribution of the pamphlets the
defendants contended that the contract between plaintiff and the independent union differs from the
contract to which Local 603 is a party; that this difference tends to weaken the bargaining position of
Local 603; and that plaintiff had conducted an advertising campaign to induce the public to purchase
milk at the store instead of by way of home delivery, and if this campaign were successful Local 603
would "lose much business," large numbers of salesmen-drivers of other *286 dairies would lose their
jobs, Local 603 would lose a substantial portion of its membership and would have its representation
and bargaining position seriously reduced. The defendants then alleged that it was considered to be
essential that an effort be made to counteract the advertising of plaintiff to have the public buy milk at
the store, and that as a means of counteracting said publicity, Local Union 603 prepared the pamphlet
for distribution to the general public. However, the evidence discloses that there are two other dairies in
the St. Louis area which deliver milk at wholesale solely to retail stores, using members of Local 603 to
do so, and no pamphlets were circulated urging the public not to buy the milk of those dairies. In
addition several dairies, which used members of Local 603, distribute milk to both, the homes and to
retail stores, but no pamphlets were circulated urging the public not to buy in the retail stores the milk
of those dairies. The pamphlets made no mention whatever of the interest of Local 603 in having milk
delivered directly to the home, because, according to Mr. Burke, "We had other mediums through which
we advertised buy your milk at the door," and Mr. Burke testified that the pamphlet was not directed to
the point of urging people to buy milk at home or of keeping the jobs of the retail drivers. As to the
allegations of the defendants that the differences in the contract impaired Local 603's bargaining
position, Mr. Burke testified that he had not seen the contract between plaintiff and the independent
union, and the evidence indicates that as compared to milk wagon drivers working under the contract of
Local 603, plaintiff's milk wagon drivers receive a higher guaranteed weekly wage and make more
money even though the commission rate is less for units in excess of 40,000 delivered in one month. Mr.
Burke stated that he did not know of the difference in the commission rate when the campaign to stop
the sale of plaintiff's products was started, and he subsequently testified that the purpose of the
pamphlets was not to attempt to improve the working conditions of the men.

Mr. Walter Bush, president of Local 603 and a member of its executive board, stated that the pamphlets
were distributed to "protect our membership, their livelihood and the income of the organization," and
he also stated that the objective was to curtail plaintiff's business and sales. Reed J. White, a business
representative of Local 603 and a member and the secretary of the executive board, stated that the
purpose of the pamphlets was to inform the public that plaintiff's drivers were not members of Local
603, but he "couldn't say" that plaintiff could ever affect the loss of retail drivers.

Maury Rubin is the sole owner and publisher of the St. Louis Labor-Tribune which has a circulation of
about 78,000. Burke is a member of the "Board of Advisors," of the Labor-Tribune, but for the past
several years he had not been solicited by Rubin for advice. Shortly after the distribution of the
pamphlets was started by Local 603, Burke gave Rubin a copy of the pamphlet and explained the
position of Local 603 concerning Adams Dairy Company, but Burke and Rubin stated that Burke did not
request Rubin to do anything. However, with reference to Local 603's campaign to stop the sales of
plaintiff's milk the defendants pleaded that Local 603 "caused to be published in the St. Louis Labor
Tribune certain appeals to the public." The general tenor of the articles published were to urge the
reading public not to buy Adams milk, and reference was made to "100% Union dairies" as contrasted to
Adams Dairy. This was an incorrect and misleading statement in view of the certification of the
independent union by the N.L.R.B. Rubin testified that the statement was an oversight, and that he
meant that Adams Dairy was not a 100% A.F. of L. union dairy. Reference was also made in some of the
articles to one of the large retail chain grocery stores as a "violator" because it continued to handle
plaintiff's milk. In general, the articles also tended to give the impression that the independent union
was not a bona fide union, although *287 the N.L.R.B. had held it was, that a labor dispute existed
between Local 603 and plaintiff, and that plaintiff was not fair to organized labor. Rubin also published
an article in which he appealed to all union members not to purchase plaintiff's products "as long as
they refuse to hire A F L deliverymen." Starting with the issue of December 30, 1954 and in the next
following four issues, Rubin printed in the Labor Tribune a coupon which he urged the readers to send
to the grocery stores which they patronized. The wording of the coupon asked the store manager to
carry exclusively the dairy products which were delivered by members of Local 603, and it was
specifically mentioned that the products of Adams Dairy were the only dairy products not so delivered.
This coupon contained an implied threat in that by sending the coupon as urged by Rubin, the sender
advised the grocery store manager that if he discontinued handling Adams Dairy products he would
"spare" the sender the embarrassment as well as the necessity of going elsewhere to buy milk and other
dairy products.

There also was evidence that during the time the pamphlets were being distributed and the articles run
in the Labor-Tribune, some damage was done in some of the retail stores to products of plaintiff, but
there was no evidence as to who did the damage other than the circumstances that at these stores
drivers of Local 603 also delivered milk of other dairies and had access to plaintiff's milk in the store.

Burke stated that he was a member of the "Teamsters' Council" composed of representatives of 21
unions in the St. Louis area, and that he informed the other members that Local 603 was "carrying out a
campaign for the public not to buy Adams Dairy products" but he stated that he did not urge the
members to carry out the campaign in their respective unions. Bush, president of Local 603, visited
numerous other unions and advised them that all dairies in the St. Louis area had contracts with Local
603 for the milk wagon drivers except Adams Dairy. At one time Burke accompanied Nick Blassie,
representative of the Meat Cutters Union, when Blassie requested the owner of several super markets
to discontinue patronizing plaintiff and to patronize other dairies who employed members of Local 603.

The facts of this case distinguish it from the usual "labor injunction" case. Here there is no labor dispute
whatever between an employer and its employees or between an employer and a union. There are no
organizational efforts by a union. In fact Local 603 denies most emphatically that it claims the right to
represent plaintiff's milk truck drivers or that it even desires to represent them. Neither is Local 603
attempting to improve working conditions nor is it attempting to compel compliance by plaintiff with
any contract covering conditions of employment, and it is not attempting to have a nonunion employer
maintain union working standards. Local 603 also takes the position that it does not have the objective
of accomplishing anything that would result in a violation of the federal Act, such as coercing plaintiff's
employees to abandon the independent union, coercing plaintiff to interfere with the free choice of its
employees as to which union should represent them, or by instituting that form of a secondary boycott
made an unfair labor practice by Section 8(b)(4).

The defendants frankly admit that by use of the pamphlets they entered into a campaign to obtain an
agreement by the members of Local 603 not to purchase plaintiff's products, and to stop the purchase
of plaintiff's products by the public. This concerted action constitutes a boycott of plaintiff's products,
and the manner in which it has been carried out results in what has sometimes been termed a
"consumption boycott" as distinguished from a "production boycott." C.C.H. Labor Law Reporter, par.
237 et seq. While there are many definitions of a boycott, in general, it may be said to include any
activity on the *288 part of a labor organization, or for that matter any other group of persons, whereby
it is sought through concerted action, other than by reason of lawful competition, to obtain withdrawal
of public patronage from one in business. See the annotations on the use of a boycott as a weapon in
industrial disputes in 6 A.L.R. 909 and 116 A.L.R. 484. It is important to note that in discussing or defining
a "labor boycott" reference is invariably made to the refusal to purchase, use or produce the products of
an employer in connection with a labor dispute. In this case there is no bona fide labor dispute between
Local 603 and plaintiff, or between Local 603 and the independent union. Adams Dairy Co. v. Dairy
Employees Union, Local 207, of International Brotherhood of Teamsters, etc., A. F. of L., 363 Mo. 182,
250 S.W.2d 481[3]; Purcell v. Journeymen Barbers & Beauticians International Union of America, Local
192-A, 234 Mo.App. 843, 133 S.W.2d 662[10].

A union may use various forms of concerted action, such as strike, picketing, or boycott, to enforce or
obtain a lawful objective that is reasonably related to any legitimate interest of organized labor. Fred
Wolferman, Inc., v. Root, 356 Mo. 976, 204 S.W.2d 733[2], 174 A.L.R. 585, certiorari denied 333 U.S. 837,
68 S. Ct. 608, 92 L. Ed. 1122; Hobbs v. Poteet, 357 Mo. 152, 207 S.W.2d 501[2]; Caldwell v. Anderson,
357 Mo. 1199, 212 S.W.2d 784[3]; Annotations: 6 A.L.R. 909 and 116 A.L.R. 484; 31 Am.Jur., Labor, § 38.
However, it is universally held that the objective of concerted labor activity must be a lawful one. Fred
Wolferman, Inc., v. Root, supra [2]; State ex rel. Allai v. Thatch, 361 Mo. 190, 234 S.W.2d 1 [9]; Kincaid-
Webber Motor Co. v. Quinn, 362 Mo. 375, 241 S.W. 2d 886[3]; Purcell v. Journeymen Barbers, etc.,
supra [13]; George F. Stuhmer & Co. v. Korman, 241 App.Div. 702, 269 N.Y.S. 788[1], affirmed 265 N.Y.
481, 193 N.E. 281; Moreland Theatres Corporation v. Portland Moving Picture Machine Operators'
Protective Union, Local No. 159, 140 Or. 35, 12 P.2d 333 [11]; Sansom House Enterprises, Inc., v. Waiters
and Waitresses Union, Local 301, AFL, 382 Pa. 476, 115 A.2d 746[1]; Dallas General Drivers,
Warehousemen and Helpers v. Jax Beer Co. of Waco, Texas, Tex.Civ. App., 276 S.W.2d 384[4]; Treasure,
Inc., v. Hotel and Restaurant Employees and Bartenders' Union, Local No. 133 (A. F. of L.), Fla., 72 So.2d
670[1]; Dalzell Towing Co., Inc., v. United Marine Division, I.L. A., Local 333, Sup., 124 N.Y.S.2d 70[2],
affirmed 281 App.Div. 968, 120 N.Y.S.2d 927; Woodard v. Collier, 210 Ga. 239, 78 S.E.2d 526[2]; Wood v.
O'Grady, 283 App.Div. 83, 126 N.Y.S.2d 408; Annotations: 6 A.L.R. 909 and 116 A.L.R. 484. In addition to
the requirement that the objective be lawful, the objective must be sought by lawful means. Giboney v.
Empire Storage & Ice Co., 336 U.S. 490, 69 S. Ct. 684, 93 L. Ed. 834; Missouri Cafeteria, Inc., v. McVey,
362 Mo. 583, 242 S.W.2d 549[2]; State ex rel. Allai v. Thatch, supra [9]; Annotations: 6 A.L.R. 909 and
116 A.L.R. 484. Otherwise the persons injured by such activity may obtain damages, injunctive relief or
both. Fred Wolferman, Inc., v. Root, supra [2]; Missouri Cafeteria, Inc., v. McVey, supra [8]; Park &
Tilford Import Corporation v. International Brotherhood of Teamsters, Chauffeurs, Warehousemen and
Helpers of America, Local No. 848, A. F. of L., 27 Cal. 2d 599, 165 P.2d 891[1], 162 A.L. R. 1426; James v.
Marinship Corporation, 25 Cal. 2d 721, 155 P.2d 329[2], 160 A.L.R. 900; Annotations: 6 A.L.R. 909 and
116 A.L.R. 484.

Defendants contend that the purpose of the concerted activity was to encourage home delivery of milk
and thereby protect the jobs of the retail drivers. However, not only is this contention not supported by
the evidence, it is contrary thereto. The publications issued by the defendants do not mention this
matter, and Mr. Burke unequivocally testified that the pamphlets were not directed to this objective. In
addition, it is inconsistent with *289 such objective to direct the pamphlets and coupons solely against
plaintiff when two other dairies in the St. Louis area also deliver milk at wholesale only to retail stores,
and other dairies deliver milk to the retail stores at wholesale and also make retail deliveries to the
homes. The pamphlets, in effect, urge the public to buy milk at the stores, but not plaintiff's milk. If the
objective were as contended by the defendants, it would be necessary to urge that the milk and milk
products of the other dairies delivered to the retail stores not be purchased, which was not done. See
George F. Stuhmer & Co. v. Korman, supra, wherein it was held that where a union permitted the sale of
nonunion made bread other than plaintiffs, this circumstance justified the inference that the purpose of
picketing was to destroy plaintiff's business and not to better labor conditions. In addition, we may and
do consider the circumstance that the defendants apparently never considered it to be in the interest of
the retail drivers to stop or curtail the sales of plaintiff's products until plaintiff's milk drivers withdrew
from Local 603. The retail drivers could be hurt no more, if at all, by plaintiff's operations after plaintiff's
drivers left Local 603 than before.

It is also clear that the differences in the terms of the contracts could not have motivated the concerted
activity because Mr. Burke had never seen the contract between plaintiff and the independent union,
and it was not until after the distribution of the pamphlets was started that he learned of the difference
in the commission rate.

The determination of the objectives of the defendants is a question of fact, Fred Wolferman, Inc. v.
Root, supra [3], and from a careful consideration of the evidence and the circumstances, we are
compelled to conclude that the objective of the concerted action was not any of the above contended
purposes. Therefore, we need not consider whether the defendants would be justified in entering into a
combination to stop the sale of plaintiff's products for these contended reasons.
The defendants next contend that the objective of their concerted action was to cause the public to buy
milk delivered exclusively by members of Local 603. Although the pamphlets and the coupons were
cleverly written to impart to the casual reader that a labor dispute existed between plaintiff and Local
603, which it did not, and that plaintiff did not employ 100% union labor, which it did, they did advance
the appeal to the public not to buy the dairy products of plaintiff because they were not delivered by
members of Local 603. This is somewhat kindred to the appeals made by unions to the public in
connection with a labor dispute that it should buy or use only the products of an employer who hires
union labor. However, plaintiff did hire 100% union labor, and regardless of the boundaries of justifiable
conduct in an organizational campaign by a union, the circumstances here make the rules in such cases
inapplicable. In this case plaintiff hired and used 100% union labor and it was required by federal law to
recognize the independent union as the exclusive representative of all of its milk wagon drivers. It is
forbidden by the same law from negotiating with Local 603 to have its milk delivered by members of
that union. The admitted purpose of the concerted action was to take plaintiff's business away from it
and to give the business to plaintiff's competitors. It is inconceivable that the public policy of this state
should be to label as a legitimate labor objective the willful and intentional damaging or destruction of
an employer's business because the employer is doing that which the federal law requires him to do and
forbids him to change if he is to remain in business.

Concerted union activity has uniformly been held to be unlawful when the purpose is not primarily
intended to benefit the union in carrying out a lawful objective or to improve working conditions, but
has as its primary purpose injury to the business of the person against whom the action is directed.
George F. Stuhmer & Co. v. Korman, supra [1,2]; Moreland Theatres *290 Corp. v. Portland Moving
Picture Machine Operators' Protective Union, supra [7]; Overseas Storage Co. v. Chlopsek, 209 App. Div.
834, 204 N.Y.S. 845; Annotations at 27 A.L.R. 651, 32 A.L.R. 779 and 116 A.L.R. 484; 15 C.J.S., Conspiracy,
§ 10; 36 Am.Jur. Monopolies, Combinations and Restraints of Trade § 27. In Aeolian Co. v. Fischer,
D.C., 27 F.2d 560, 564, injunctive relief against a boycott involving the refusal to work with non-union
men was denied under the facts of that case, but in the opinion the court said: "How far the members of
a craft may go in their organized capacity * * * depends upon the extent to which those who co-operate
have in point of fact a common interest, and are justified in what they do by honest motives to advance
self-interest, as opposed to malicious intent to injure the business or good will of another."

We conclude from all the evidence and circumstances, and particularly from the admissions of the
defendants, that the purpose of the concerted activity against plaintiff was not reasonably related to
and not in the furtherance of any legitimate objective of Local 603, but was imposed and carried out by
the defendants as a means of inflicting, as its primary objective, damage to plaintiff's business because
the plaintiff, by requirement of law, was conducting its business contrary to the wishes of the
defendants. This constituted a malicious interference with the business of another. 36 Am.Jur.
Monopolies, Combinations, and Restraints of Trade § 26.

Section 416.010 RSMo 1949, V.A.M.S., entitled "Combination in restraint of trade declared a conspiracy"
provides as follows: "Any person who shall create, enter into, become a member of or participate in any
pool, trust, agreement, combination, confederation or understanding with any person or persons in
restraint of trade or competition in the importation, transportation, manufacture, purchase or sale of
any product or commodity in this state, or any article or thing bought or sold whatsoever, shall be
deemed and adjudged guilty of a conspiracy in restraint of trade, and shall be punished as provided in
sections 416.010 to 416.100, 416.240, 416.260 to 416.290 and 416.400." This statute has been held to
be inapplicable to concerted activities of members of labor organizations carried on for lawful
objectives. Caldwell v. Anderson, 357 Mo. 1199, 212 S.W.2d 784; Gruet Motor Car Co. v. Briner,
Mo.App., 229 S.W.2d 259. But it is applicable to concerted activities for an unlawful objective which
result in a restraint of trade. Rogers v. Poteet, 355 Mo. 986, 199 S.W.2d 378; Hobbs v. Poteet, supra;
Empire Storage & Ice Co. v. Giboney, 357 Mo. 671, 210 S.W.2d 55; and Giboney v. Empire Storage & Ice
Co., supra; Anheuser-Busch, Inc., v. Weber, 364 Mo. 573, 265 S.W.2d 325, reversed on jurisdictional
grounds 348 U.S. 468, 75 S. Ct. 480, 99 L. Ed. 546. The unlawfulness of a conspiracy may be found either
in the end sought or the means used. Frank Schmidt Planing Mill Co. v. Mueller, Mo.App., 154 S.W.2d
610[2]; A. T. Stearns Lumber Co. v. Howlett, 260 Mass. 45, 157 N.E. 82[1], 52 A.L.R. 1125; 15 C.J.S.,
Conspiracy, §§ 3 and 4. Here the combination of the defendants to stop the sale of plaintiff's products
had no lawful objective, it resulted in the restraint of the purchase and sale of plaintiff's products, and
was therefore a conspiracy in violation of Section 416.010.

Although Maury Rubin is not an officer or member of Local 603, he voluntarily joined into the conspiracy
with full knowledge of the objectives of the other defendants, and in aid thereof published misleading
articles and published the coupons, containing the implied threat, appealing to his readers and to the
public in general to stop the purchase and sale of plaintiff's products, and when the purpose of a
combination is illegal, every act in furtherance thereof is illegal. Moreland Theatres Corporation v.
Portland Moving Picture Machine Operators' Protective Union, supra.

*291 Defendants contend that they were engaging only in activities which are guaranteed against
restraint by the First and Fourteenth Amendments of the United States Constitution, and Missouri
Constitution of 1945, Article I, section 8. They cite in support of this position Thornhill v. Alabama, 310
U.S. 88, 60 S. Ct. 736, 84 L. Ed. 1093; Schneider v. State, 308 U.S. 147, 60 S. Ct. 146, 84 L. Ed. 155; United
States v. Hutcheson, 312 U.S. 219, 243, 61 S. Ct. 463, 85 L. Ed. 788; Milk Wagon Drivers' Union, Local No.
753, etc., v. Lake Valley Farm Products, Inc., 311 U.S. 91, 61 S. Ct. 122, 85 L. Ed. 63; American Federation
of Labor v. Swing, 312 U.S. 321, 61 S. Ct. 568, 85 L. Ed. 855, and other cases. We have read and studied
all the cases cited and are of the opinion that none extends the constitutional guaranty of free speech to
the situation here. In the interest of brevity we shall comment only on those cases above mentioned.

In Thornhill v. Alabama it was held that the dissemination of information concerning the facts of a labor
dispute must be regarded as within the area of free discussion that is guaranteed by the United States
Constitution, a general principle with which there is no dispute. But in Giboney v. Empire Storage & Ice
Co., supra, the United States Supreme Court affirmed the validity of Section 416.010 RSMo 1949,
V.A.M.S., as applying to concerted activity of members of a labor organization, and in commenting upon
Thornhill v. Alabama stated that the union's conduct in that case "constituted a single and integrated
course of conduct, which was in violation of Missouri's valid law", Section 416.010, and that the
constitutional right to freedom of the press and speech does not extend "its immunity to speech or
writing used as an integral part of conduct in violation of a valid criminal statute." [336 U.S. 490, 69 S. Ct.
688.]

Schneider v. State pertained to the validity of an ordinance which prohibited the distribution of handbills
and circulars on the public street. That case did not involve any question pertaining to the right to pass
out handbills or circulars in furtherance of an illegal conspiracy in violation of a valid state law.

United States v. Hutcheson was a criminal case in which the defendant was charged with the violation of
the Sherman Anti-Trust Law, 15 U.S.C.A. §§ 1-7, 15 note. The conduct of the defendant had some
similarity to the conduct here, except that a strike was involved and the whole dispute arose out of a
jurisdictional dispute between two craft unions, while here we have no labor dispute, as far as the law of
this state is concerned, between an employer and a union or between unions. The majority opinion
apparently proceeded on the theory that the conduct probably constituted a violation of the Sherman
Anti-Trust Act standing alone, but by passage of the Norris-La Guardia Act, 29 U.S.C.A. § 101 et seq.,
Congress had established the "'public policy of the United States'", and it was held that the Sherman Act,
the Clayton Act, 15 U.S.C.A. § 12 et seq., and the Norris-La Guardia Act must all be read together as a
"harmonizing text of outlawry of labor conduct." [312 U.S. 219, 61 S. Ct. 466.] We have no statute in
Missouri similar to the Norris-La Guardia Act purporting to limit the jurisdiction of the state courts over
the conduct of the defendants in this case, and Missouri, rightfully or wrongfully, has not seen fit to
exempt activities of labor unions and their members from its statute making illegal certain conspiracies
in restraint of trade. Giboney v. Empire Storage & Ice Co., supra. As stated in the Giboney case, the
constitutional guaranties do not "afford labor union members a peculiar immunity from [state] laws
against trade restraint combinations". [336 U.S. at page 495, 69 S.Ct. at page 687, 93 L.Ed. at page 840].

Milk Wagon Drivers Union, etc., v. Lake Valley Farm Products pertained only to whether certain conduct
was in furtherance of a "labor dispute" within the broad definition *292 of that term as contained in the
Norris-La Guardia Act which limited the jurisdiction of federal courts, and American Federation of Labor
v. Swing held no more than that the constitutional guaranty of freedom of discussion is infringed by the
common law policy of a state limiting peaceful picketing by labor unions to situations in which the
controversy is between the employer and his own employees.

This court recently held that concerted union activity in the form of "Picketing, even though properly
conducted in all respects, may be enjoined if its objective is unlawful as violative of the public policy of a
state, either legislatively or judicially declared. And the enjoining of unlawfulobjective picketing does not
constitute a denial of the constitutional guaranty of free speech." See Heath v. Motion Picture Machine
Operators Union No. 170, Mo.Sup., 290 S.W.2d 152, 157, and the cases there cited. Picketing is but a
form of communication as is the distribution of the pamphlets and coupons in this case, and we see no
material distinction between unlawfulobjective picketing and the unlawful-objective distribution of
pamphlets and coupons in furtherance of an illegal conspiracy in restraint of trade.

Although defendants deny any violation of the federal Act, they urge that if the facts are as contended
by plaintiff, neither the trial court nor this court has any jurisdiction over the subject matter of this
action because the processes provided for in the federal Act are exclusive. This "delicate problem,"
Weber v. Anheuser-Busch, Inc., 348 U.S. 468, 75 S. Ct. 480, 99 L. Ed. 546, of jurisdiction is by no means
settled, but in Garner v. Teamsters, Chauffeurs and Helpers Local Union No. 776 (A.F.L.), 346 U.S. 485, 74
S. Ct. 161, 164, 98 L. Ed. 228, it was said that the federal Act "leaves much to the states," and by
distinguishing the facts in that case from situations in which there is injurious conduct which the
National Labor Relations Board is without express power to prevent, it was made clear that in many
situations the states retain jurisdiction over concerted activity by labor unions. Express approval was
given to the previous cases which held, in effect, that a state may exercise "`"its historic powers over
such traditionally local matters as public safety and order and the use of streets and highways"'", and as
it has subsequently been said, "the contention that Congress intended to legislate for the entire field of
labor controversy and excluded all State jurisdiction is untenable." Irving Subway Grating Co., Inc., v.
Silverman, D.C., 117 F. Supp. 671, 680. See also United Automobile, Aircraft and Agricultural Implement
Workers of America, etc. v. Wisconsin Employment Relations Board, U.S., 76 S. Ct. 794.
In Weber v. Anheuser-Busch, Inc., supra [348 U.S. 468, 75 S. Ct. 488], it was held that where the "moving
party itself alleges unfair labor practices [under the federal law], where the facts reasonably bring the
controversy within the sections prohibiting these practices, and where the conduct, if not prohibited by
the federal Act, may be reasonably deemed to come within the protection afforded by that Act, the
state court must decline jurisdiction in deference to the tribunal which Congress has selected for
determining such issues in the first instance." It is clear from this statement that if these enumerated
conditions are not present, state courts are not prohibited by reason of the federal Act from exercising
jurisdiction. In this case plaintiff did not allege "unfair labor practices" under the federal Act, and we are
of the opinion that the facts do not reasonably bring the controversy within the sections of the federal
Act prohibiting "unfair labor practices" or within that conduct for which protection is afforded by that
Act.

The defendants were not attempting to exercise any right guaranteed to labor organizations under
Section 7 of the federal Act. The Supreme Court of the United States has held that Section 7 does not
grant to employees or labor unions the *293 right to engage in any and all concerted activity. The Act
"does not excuse `concerted activities,' themselves independently unlawful." N. L. R. B. v. Peter Cailler
Kohler Swiss Chocolates Co., Inc., 2 Cir., 130 F.2d 503, 506. See also National Labor Relations Board v.
Fansteel Metallurgical Corporation, 306 U.S. 240, 59 S. Ct. 490, 83 L. Ed. 627, 123 A.L.R. 599, where the
right to engage in concerted activities did not make legal a sit-down strike which state law made illegal.
See also International Union, U.A.W., A.F. of L., Local 232 v. Wisconsin Employment Relations Board, 336
U.S. 245, 69 S. Ct. 516, 93 L. Ed. 651, where it was pointed out that if the courts had not held that
Section 7 did not include the right to violate the law, Congress would have done so, and that such
provision was not specifically included in the present language of Section 7 because, as stated in H.
R.Rep. No. 510, 80th Cong., 1st Sess. p. 38, "the courts have firmly established the rule that under the
existing provisions of Section 7 of the National Labor Relations Act, employees are not given any right to
engage in unlawful or other improper conduct." Also see Local Union No. 1229, International
Brotherhood of Electrical Workers v. N. L. R. B., 91 U.S.App.D.C. 333, 202 F.2d 186, 189, and the
comment in footnote 17 that "concerted activity violating valid state law will not be protected by § 7 of
the Act."

Defendants also contend that the state courts do not have jurisdiction because if the facts are as we
have found them their conduct is of the nature and type made to constitute an unfair labor practice
under Section 8(b)(4). We do not agree. The evidence in this case clearly establishes that the pamphlets
were distributed at the customer entrances of the retail stores, and that no attempt to stop deliveries
was made and no deliveries were stopped. There is no evidence that any employee of the retail stores
or the employees of any other employer was induced or coerced to go on strike or to refuse, in the
course of their employment, to use, process or otherwise handle plaintiff's products. Neither is there
substantial evidence that the defendants forced or attempted to force a secondary employer subject to
the federal Act to cease doing business with plaintiff. In Crowley's Milk Company, Inc. and Milk Drivers
and Dairy Employees Local Union No. 680, International Brotherhood of Teamsters, Chauffeurs,
Warehousemen and Helpers, A. F. of L. and United Dairy Workers Association, 102 N.L.R.B. 996, one
Smith was ordered by the N.L.R.B. to be reinstated. The employer contended that Smith was not
entitled to reinstatement because he had engaged in an unlawful boycott under Section 8(b)(4). Note
what was said by the N.L.R.B. at pages 997 and 998: "With respect to the alleged secondary boycott,
Smith admitted at the second hearing that he had picketed two of the Respondent's customers. The only
establishment identified was the Guernsey Crest Ice Cream Company of Paterson, where it appears that
a picket sign was carried in front of the customers' entrance. The sign read in effect 'This establishment
sells products of Crowley's Milk Company, which Company is on strike. Please do not buy Crowley's
products. Teamsters Local 680, A.F.L.' When asked by Respondent's counsel at the second hearing if he
did not picket Crowley's customers to influence the customers' employees to cease handling Crowley's
products, Smith answered `we picketed the stores so that the customers would not buy Crowley's
products.' The foregoing is the only persuasive evidence adduced at either hearing concerning the
alleged secondary boycott. Section 8(b)(4)(A) of the Act provides that it shall be an unfair labor practice
for a labor organization or its agents' * * * to engage in, or to induce or encourage the employees of any
employer to engage in, a strike or a concerted refusal in the course of their employment to use,
manufacture, process, transport, or otherwise handle or work on any goods * * * where an object
thereof is * * * forcing or requiring *294 * * * any employer or other person to cease using, selling,
handling, transporting, or otherwise dealing in the products of any other producer, processor, or
manufacturer, or to cease doing business with any other person * * *.' It is clear from the record that in
picketing the premises of the Respondent's customers the Union intended to institute a consumer
boycott only. There is no evidence, either direct or circumstantial, that the Union made any appeal to
employees of the Respondent's customers, or ever picketed the employee or delivery entrances of any
of the customers. In the circumstances the Union's secondary picketing, whether it be viewed as a direct
appeal to the Respondent's customers or as an appeal to those doing business with the Respondent's
customers, was not violative of Section 8(b)(4)(A) of the Act." This order of the N.L.R.B. was
subsequently enforced by the United States Circuit Court of Appeals. N. L. R. B. v. Crowley's Milk Co.,
Inc., 3 Cir., 208 F.2d 444.

In N. L. R. B. v. Business Machine and Office Appliance Mechanics Conference Board, Local 459,
International Union of Electrical, Radio & Machine Workers, CIO, 2 Cir., 228 F.2d 553, 559, the court, in
commenting on the scope of Section 8(b)(4) said: "But the Taft-Hartley Act does not proscribe all
secondary activity. We have held that requests and threats addressed directly to secondary employers
are not illegal, Rabouin v. N. L. R. B., 2 Cir., 1952, 195 F.2d 906, 911, 912; see N.L.R.B. v. Associated
Musicians of Greater New York, Local 802, 2 Cir., 226 F.2d 900; and we have indicated that solicitation of
customers of secondary employers is also lawful. See N. L. R. B. v. Service Trade Chauffeurs, Salesmen,
and Helpers, Local 145, supra, at 2 Cir., 191 F.2d [65] at page 68. The only thing proscribed by § 8(b) (4)
is inducement or encouragement of the employees of customers." See also Administrative Decision of
the General Counsel [of N.L.R.B.], Case No. K-147, Jan. 12, 1956, C.C.H.Labor Law Reporter, par. 53,495,
which pertained to a situation involving activity similar to that in this case, and Milwaukee Boston Store
Co. v. American Federation of Hosiery Workers, Branch 16, A.F. of L., 269 Wis. 338, 69 N.W.2d 762[7].

We have concluded in this case that the acts of the defendants constituted an illegal conspiracy in
violation of the laws of this state, and that the boycott pursuant to that conspiracy was not imposed or
carried out for any lawful labor objective. This case falls exactly within the ruling in G., H. & E. Freydberg,
Inc., v. International Ladies' Garment Workers' Union, Sup., 128 N.Y.S.2d 470, 472. There the union
picketed an employer for the purpose of compelling it to maintain a factory in New York. The court said:
"I think * * * that is not a lawful labor objective, that there consequently is no labor dispute or any
controversy involving labor relations, and that the picketing, even if peaceful, is unlawful because it is an
attempt to injure plaintiff by subjecting it to economic pressure without justification in law. * * * As to
the question of jurisdiction, I assume in defendants' favor that plaintiff is engaged in interstate
commerce. From that it follows that existing Federal statutes so completely cover the subject of labor
relations in interstate commerce that neither State statutes nor State courts can add to or subtract from
the rights and immunities of employers or employees as specified in those Federal statutes [Cases cited
including Garner v. Teamsters, Chauffeurs and Helpers Local Union No. 776 (A.F.L.)]. But my holding that
this picketing is not for a lawful labor objective takes this case out of the field of labor relations and out
of the doctrine of those cases. This picketing is not an exercise of any right conferred, recognized, or
regulated by any Federal statute, and is not designed to enforce or secure recognition of any such right,
or to prevent conduct by plaintiff which any Federal statute denounces as 'an unfair labor practice'; and
the injunction is not sought in order to prevent conduct by defendants which any Federal *295 statute
denounces as an unfair labor practice. The picketing is a tortious act under the law of New York entirely
apart from any labor relation; and as I see it this case hence is precisely what the Supreme Court said the
Garner case was not, namely, `an instance of injurious conduct which the National Labor Relations Board
is without express power to prevent and which therefore either is "governable by the state or is entirely
ungoverned."' See 346 U.S. [485] at page 488, 74 S.Ct. [161] at page 164 [, 98 L. Ed. 228]."

This case is distinguishable from Graybar Electric Company, Inc. v. Automotive, Petroleum & Allied
Industries Employees Union, Local 618, Mo.Sup., 287 S.W.2d 794; and Jack Cooper Transport Company
v. Stufflebeam, Mo.Sup., 280 S.W.2d 832, in that the concerted activity of the defendants in this case
was not done in furtherance of any legitimate objective of a labor union, and the facts do not
"reasonably bring the controversy within the sections [of the federal Act] prohibiting these practices,
and * * * the conduct, if not prohibited by the federal Act, may [not] be reasonably deemed to come
within the protection afforded by that Act". See Weber v. Anheuser-Busch, Inc., supra [348 U.S. 468, 75
S. Ct. 488].

For the reasons above set forth the trial court erred in denying the plaintiff injunctive relief from the
conduct of the defendants, and therefore the judgment is reversed and the cause remanded for further
proceedings in accordance with the views here expressed.

BOHLING and BARRETT, CC., concur.

PER CURIAM.

G.R. No. 147080. April 26, 2005

CAPITOL MEDICAL CENTER, INC., Petitioners,

vs.
NATIONAL LABOR RELATIONS COMMISSION, JAIME IBABAO, JOSE BALLESTEROS, RONALD CENTENO,
NARCISO SARMIENTO, EDUARDO CANAVERAL, SHERLITO DELA CRUZ, SOFRONIO COMANDAO,
MARIANO GALICIA, RAMON MOLOD, CARMENCITA SARMIENTO, HELEN MOLOD, ROSA COMANDAO,
ANGELITO CUIZON, ALEX MARASIGAN, JESUS CEDRO, ENRICO ROQUE, JAY PERILLA, HELEN MENDOZA,
MARY GLADYS GEMPEROSO, NINI BAUTISTA, ELENA MACARUBBO, MUSTIOLA SALVACION DAPITO,
ALEXANDER MANABE, MICHAEL EUSTAQUIO, ROSE AZARES, FERNANDO MANZANO, HENRY VERA
CRUZ, CHITO MENDOZA, FREDELITA TOMAYAO, ISABEL BRUCAL, MAHALKO LAYACAN, RAINIER
MANACSA, KAREN VILLARENTE, FRANCES ACACIO, LAMBERTO CONTI, LORENA BEACH, JUDILAH
RAVALO, DEBORAH NAVE, MARILEN CABALQUINTO, EMILIANA RIVERA, MA. ROSARIO URBANO,
ROWENA ARILLA, CAPITOL MEDICAL CENTER EMPLOYEES ASSOCIATION-AFW, GREGORIO DEL PRADO,
ARIEL ARAJA, and JESUS STA. BARBARA, JR., Respondents.

DECISION

CALLEJO, SR., J.:

This is a petition for review of the Decision1 of the Court of Appeals (CA) in CA-G.R. SP No. 57500 and its
Resolution denying the motion for reconsideration thereof.

The Antecedents2

Whether the respondent Capitol Medical Center Employees Association-Alliance of Filipino Workers (the
Union, for brevity) was the exclusive bargaining agent of the rank-and-file employees of the petitioner
Capitol Medical Center, Inc. had been the bone of contention between the Union and the petitioner. The
petitioner’s refusal to negotiate for a collective bargaining agreement (CBA) resulted in a union-led
strike on April 15, 1993.

The Union had to contend with another union – the Capitol Medical Center Alliance of Concerned
Employees (CMC-ACE) – which demanded for a certification election among the rank-and-file employees
of the petitioner. Med-Arbiter Brigida Fadrigon granted the petition, and the matter was appealed to the
Secretary of Labor and Employment (SOLE). Undersecretary Bienvenido E. Laguesma rendered a
Resolution on November 18, 1994 granting the appeal. He, likewise, denied the motion filed by the
petitioner and the CMC-ACE. The latter thereafter brought the matter to the Court which rendered
judgment on February 4, 1997 affirming the resolution of Undersecretary Laguesma, thus:

1. Dismissing the petition for certification election filed by the Capitol Medical Center Alliance of
Concerned Employees-United Filipino Services Workers for lack of merit; and

2. Directing the management of the Capitol Medical Center to negotiate a CBA with the Capitol Medical
Center Employees Association-Alliance of Filipino Workers, the certified bargaining agent of the rank-
and-file employees.3

The decision of the Court became final and executory. Thereafter, in a Letter dated October 3, 1997
addressed to Dr. Thelma N. Clemente, the President and Director of the petitioner, the Union requested
for a meeting to discuss matters pertaining to a negotiation for a CBA, conformably with the decision of
the Court.4 However, in a Letter to the Union dated October 10, 1997, Dr. Clemente rejected the
proposed meeting, on her claim that it was a violation of Republic Act No. 6713 and that the Union was
not a legitimate one. On October 15, 1997, the petitioner filed a Petition for the Cancellation of the
Union’s Certificate of Registration with the Department of Labor and Employment (DOLE) on the
following grounds:

3) Respondent has failed for several years to submit annually its annual financial statements and other
documents as required by law. For this reason, respondent has long lost its legal personality as a union.
4) Respondent also engaged in a strike which has been declared illegal by the National Labor Relations
Commission.5

Apparently unaware of the petition, the Union reiterated its proposal for CBA negotiations in a Letter
dated October 16, 1997 and suggested the date, time and place of the initial meeting. The Union further
reiterated its plea in another Letter6 dated October 28, 1997, to no avail.

Instead of filing a motion with the SOLE for the enforcement of the resolutions of Undersecretary
Laguesma as affirmed by this Court, the Union filed a Notice of Strike on October 29, 1997 with the
National Conciliation and Mediation Board (NCMB), serving a copy thereof to the petitioner. The Union
alleged as grounds for the projected strike the following acts of the petitioner: (a) refusal to bargain; (b)
coercion on employees; and (c) interference/ restraint to self-organization.7

A series of conferences was conducted before the NCMB (National Capital Region), but no agreement
was reached. On November 6, 1997, the petitioner even filed a Letter with the Board requesting that the
notice of strike be dismissed;8 the Union had apparently failed to furnish the Regional Branch of the
NCMB with a copy of a notice of the meeting where the strike vote was conducted.

On November 20, 1997, the Union submitted to the NCMB the minutes9 of the alleged strike vote
purportedly held on November 10, 1997 at the parking lot in front of the petitioner’s premises, at the
corner of Scout Magbanua Street and Panay Avenue, Quezon City. It appears that 178 out of the 300
union members participated therein, and the results were as follows: 156 members voted to strike; 14
members cast negative votes; and eight votes were spoiled.10

On November 28, 1997, the officers and members of the Union staged a strike. Subsequently, on
December 1, 1997, the Union filed an ex parte motion with the DOLE, praying for its assumption of
jurisdiction over the dispute. The Union likewise prayed for the imposition of appropriate legal
sanctions, not limited to contempt and other penalties, against the hospital director/president and
other responsible corporate officers for their continuous refusal, in bad faith, to bargain collectively with
the Union, to adjudge the same hospital director/president and other corporate officers guilty of unfair
labor practices, and for other just, equitable and expeditious reliefs in the premises.11

On December 4, 1997, the SOLE issued an Order, assuming jurisdiction over the ongoing labor dispute.
The decretal portion of the order reads:

WHEREFORE, this Office now assumes jurisdiction over the labor disputes at Capitol Medical Center
pursuant to Article 263(g) of the Labor Code, as amended. Consequently, all striking workers are
directed to return to work within twenty-four (24) hours from the receipt of this Order and the
management to resume normal operations and accept back all striking workers under the same terms
and conditions prevailing before the strike. Further, parties are directed to cease and desist from
committing any act that may exacerbate the situation.

Moreover, parties are hereby directed to submit within 10 days from receipt of this Order proposals and
counter-proposals leading to the conclusion of the collective bargaining agreements in compliance with
aforementioned Resolution of the Office as affirmed by the Supreme Court.

SO ORDERED.12
In obedience to the order of the SOLE, the officers and members of the Union stopped their strike and
returned to work.

For its part, the petitioner filed a petition13 to declare the strike illegal with the National Labor Relations
Commission (NLRC), docketed as NLRC NCR Case No. 00-12-08644-97. In its position paper, the
petitioner appended the affidavit of Erwin Barbacena, the overseer of the property across the hospital
which was being used as a parking lot, at the corner of Scout Magbanua Street and Panay Avenue,
Quezon City. Also included were the affidavits of Simon J. Tingzon and Reggie B. Barawid, the
petitioner’s security guards assigned in front of the hospital premises. They attested to the fact that no
secret balloting took place at the said parking lot from 6:00 a.m. to 7:00 p.m. of November 10,
1997.14 The petitioner also appended the affidavit of Henry V. Vera Cruz, who alleged that he was a
member of the Union and had discovered that signatures on the Statements of Cash Receipt Over
Disbursement submitted by the Union to the DOLE purporting to be his were not his genuine
signatures;15 the affidavits of 17 of its employees, who declared that no formal voting was held by the
members of the Union on the said date, were also submitted. The latter employees also declared that
they were not members of any union, and yet were asked to sign documents purporting to be a strike
vote attendance and unnumbered strike vote ballots on different dates from November 8 to 11, 1997.

In their position paper, the respondents appended the joint affidavit of the Union president and those
members who alleged that they had cast their votes during the strike vote held on November 10, 1997.16

In the meantime, on September 30, 1998, the Regional Director of the DOLE rendered a Decision
denying the petition for the cancellation of the respondent Union’s certificate of registration. The
decision was affirmed by the Director of the Bureau of Labor Relations on December 29, 1998.

In a parallel development, Labor Arbiter Facundo L. Leda rendered a Decision on December 23, 1998 in
NLRC NCR Case No. 00-12-08644-97 in favor of the petitioner, and declared the strike staged by the
respondents illegal. The fallo of the decision reads:

1. Declaring as illegal the strike staged by the respondents from November 28, 1997 to December 5,
1997;

2. Declaring respondent Jaime Ibabao, in his capacity as union president, the other union officers, and
respondents Ronald Q. Centeno, Michael Eustaquio and Henry Vera Cruz to have lost their employment
status with petitioner; and

3. Ordering the above respondents to pay, jointly and severally, petitioner the amount of Two Hundred
Thousand Pesos (₱200,000.00) by way of damages.17

The Labor Arbiter ruled that no voting had taken place on November 10, 1997; moreover, no notice of
such voting was furnished to the NCMB at least twenty-four (24) hours prior to the intended holding of
the strike vote. According to the Labor Arbiter, the affidavits of the petitioner’s 17 employees who
alleged that no strike vote was taken, and supported by the affidavit of the overseer of the parking lot
and the security guards, must prevail as against the minutes of the strike vote presented by the
respondents. The Labor Arbiter also held that in light of Article 263(9) of the Labor Code, the respondent
Union should have filed a motion for a writ of execution of the resolution of Undersecretary Laguesma
which was affirmed by this Court instead of staging a strike.
The respondents appealed the decision to the NLRC which rendered a Decision18 on June 14, 1999,
granting their appeal and reversing the decision of the Labor Arbiter. The NLRC also denied the
petitioner’s petition to declare the strike illegal. In resolving the issue of whether the union members
held a strike vote on November 10, 1997, the NLRC ruled as follows:

We find untenable the Labor Arbiter’s finding that no actual strike voting took place on November 10,
1997, claiming that this is supported by the affidavit of Erwin Barbacena, the overseer of the parking lot
across the hospital, and the sworn statements of nineteen (19) (sic) union members. While it is true that
no strike voting took place in the parking lot which he is overseeing, it does not mean that no strike
voting ever took place at all because the same was conducted in the parking lot immediately/directly
fronting, not across, the hospital building (Annexes "1-J," "1-K" to "1-K-6"). Further, it is apparent that
the nineteen (19) (sic) hospital employees, who recanted their participation in the strike voting, did so
involuntarily for fear of loss of employment, considering that their Affidavits are uniform and pro
forma (Annexes "H-2" to "H-19").19

The NLRC ruled that under Section 7, Rule XXII of DOLE Order No. 9, Series of 1997, absent a showing
that the NCMB decided to supervise the conduct of a secret balloting and informed the union of the said
decision, or that any such request was made by any of the parties who would be affected by the secret
balloting and to which the NCMB agreed, the respondents were not mandated to furnish the NCMB with
such notice before the strike vote was conducted.20

The petitioner filed a motion for the reconsideration of the decision, but the NLRC denied the said
motion on September 30, 1999.21

The petitioner filed a petition for certiorari with the CA assailing the decision and resolution of the NLRC
on the following allegation:

PUBLIC RESPONDENT NATIONAL LABOR RELATIONS COMMISSION (NLRC) COMMITTED GRAVE ABUSE OF
DISCRETION AMOUNTING TO LACK OR EXCESS OF JURISDICTION, ACTED CAPRICIOUSLY, AND
CONTRAVENED THE LAW AND ESTABLISHED JURISPRUDENCE IN REVERSING THE LABOR ARBITER’S
DECISION DATED DECEMBER 23, 1998 (ANNEX "E") AND IN UPHOLDING THE LEGALITY OF THE STRIKE
STAGED BY PRIVATE RESPONDENTS FROM NOVEMBER 28, 1997 TO DECEMBER 5, 1997.22

On September 29, 2000, the CA rendered judgment dismissing the petition and affirming the assailed
decision and resolution of the NLRC.

The petitioner filed the instant petition for review on certiorari under Rule 45 of the Rules of Court on
the following ground:

THE COURT OF APPEALS GRAVELY ERRED IN UPHOLDING THE NLRC’S FINDING THAT RESPONDENTS
COMPLIED WITH THE LEGAL REQUIREMENTS FOR STAGING THE SUBJECT STRIKE.23

The petitioner asserts that the NLRC and the CA erred in holding that the submission of a notice of a
strike vote to the Regional Branch of the NCMB as required by Section 7, Rule XXII of the Omnibus Rules
Implementing the Labor Code, is merely directory and not mandatory. The use of the word "shall" in the
rules, the petitioner avers, indubitably indicates the mandatory nature of the respondent Union’s duty
to submit the said notice of strike vote.
The petitioner contends that the CA erred in affirming the decision of the NLRC which declared that the
respondents complied with all the requirements for a lawful strike. The petitioner insists that, as
gleaned from the affidavits of the 17 union members and that of the overseer, and contrary to the joint
affidavit of the officers and some union members, no meeting was held and no secret balloting was
conducted on November 10, 1997.

The petitioner faults the CA and the NLRC for holding that a meeting for a strike vote was held on the
said date by the respondents, despite the fact that the NLRC did not conduct an ocular inspection of the
area where the respondent’s members allegedly held the voting. The petitioner also points out that it
adduced documentary evidence in the form of affidavits executed by 17 members of the respondent
union which remained unrebutted. The petitioner also posits that the CA and the NLRC erred in
reversing the finding of the Labor Arbiter; furthermore, there was no need for the respondent union to
stage a strike on November 28, 1997 because it had filed an urgent motion with the DOLE for the
enforcement and execution of the decision of this Court in G.R. No. 118915.

The petition is meritorious.

We agree with the petitioner that the respondent Union failed to comply with the second paragraph of
Section 10, Rule XXII of the Omnibus Rules of the NLRC which reads:

Section 10. Strike or lockout vote. – 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 the purpose. A decision to declare a lockout must be approved by a majority of the
Board of Directors of the employer, corporation or association or the partners obtained by a secret
ballot in a meeting called for the purpose.

The regional branch of the Board 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
regional branch of the Board and notice of meetings referred to in the preceding paragraph at least
twenty-four (24) hours before such meetings as well as the results of the voting at least seven (7) days
before the intended strike or lockout, subject to the cooling-off period provided in this Rule.

Although the second paragraph of Section 10 of the said Rule is not provided in the Labor Code of the
Philippines, nevertheless, the same was incorporated in the Omnibus Rules Implementing the Labor
Code and has the force and effect of law.24

Aside from the mandatory notices embedded in Article 263, paragraphs (c) and (f) of the Labor Code, a
union intending to stage a strike is mandated to notify the NCMB of the meeting for the conduct of
strike vote, at least twenty-four (24) hours prior to such meeting. Unless the NCMB is notified of the
date, place and time of the meeting of the union members for the conduct of a strike vote, the NCMB
would be unable to supervise the holding of the same, if and when it decides to exercise its power of
supervision. In National Federation of Labor v. NLRC,25 the Court enumerated the notices required by
Article 263 of the Labor Code and the Implementing Rules, which include the 24-hour prior notice to the
NCMB:

1) A notice of strike, with the required contents, should be filed with the DOLE, specifically the Regional
Branch of the NCMB, copy furnished the employer of the union;
2) A cooling-off period must be observed between the filing of notice and the actual execution of the
strike thirty (30) days in case of bargaining deadlock and fifteen (15) days in case of unfair labor practice.
However, in the case of union busting where the union’s existence is threatened, the cooling-off period
need not be observed.

4) Before a strike is actually commenced, a strike vote should be taken by secret balloting, with a 24-
hour prior notice to NCMB. The decision to declare a strike requires the secret-ballot approval of
majority of the total union membership in the bargaining unit concerned.

5) The result of the strike vote should be reported to the NCMB at least seven (7) days before the
intended strike or lockout, subject to the cooling-off period.

A union is mandated to notify the NCMB of an impending dispute in a particular bargaining unit via a
notice of strike. Thereafter, the NCMB, through its conciliator-mediators, shall call the parties to a
conference at the soonest possible time in order to actively assist them in exploring all possibilities for
amicable settlement. In the event of the failure in the conciliation/mediation proceedings, the parties
shall be encouraged to submit their dispute for voluntary arbitration. However, if the parties refuse, the
union may hold a strike vote, and if the requisite number of votes is obtained, a strike may ensue. The
purpose of the strike vote is to ensure that the decision to strike broadly rests with the majority of the
union members in general and not with a mere minority, and at the same time, discourage wildcat
strikes, union bossism and even corruption.26 A strike vote report submitted to the NCMB at least seven
days prior to the intended date of strike ensures that a strike vote was, indeed, taken. In the event that
the report is false, the seven-day period affords the members an opportunity to take the appropriate
remedy before it is too late.27 The 15 to 30 day cooling-off period is designed to afford the parties the
opportunity to amicably resolve the dispute with the assistance of the NCMB
conciliator/mediator,28 while the seven-day strike ban is intended to give the DOLE an opportunity to
verify whether the projected strike really carries the imprimatur of the majority of the union members.29

The requirement of giving notice of the conduct of a strike vote to the NCMB at least 24 hours before
the meeting for the said purpose is designed to (a) inform the NCMB of the intent of the union to
conduct a strike vote; (b) give the NCMB ample time to decide on whether or not there is a need to
supervise the conduct of the strike vote to prevent any acts of violence and/or irregularities attendant
thereto; and (c) should the NCMB decide on its own initiative or upon the request of an interested party
including the employer, to supervise the strike vote, to give it ample time to prepare for the deployment
of the requisite personnel, including peace officers if need be. Unless and until the NCMB is notified at
least 24 hours of the union’s decision to conduct a strike vote, and the date, place, and time thereof, the
NCMB cannot determine for itself whether to supervise a strike vote meeting or not and insure its
peaceful and regular conduct. The failure of a union to comply with the requirement of the giving of
notice to the NCMB at least 24 hours prior to the holding of a strike vote meeting will render the
subsequent strike staged by the union illegal.

In this case, the respondent Union failed to comply with the 24-hour prior notice requirement to the
NCMB before it conducted the alleged strike vote meeting on November 10, 1997. As a result, the
petitioner complained that no strike vote meeting ever took place and averred that the strike staged by
the respondent union was illegal.
Conformably to Article 264 of the Labor Code of the Philippines30 and Section 7, Rule XXII of the Omnibus
Rules Implementing the Labor Code,31 no labor organization shall declare a strike unless supported by a
majority vote of the members of the union obtained by secret ballot in a meeting called for that
purpose. The requirement is mandatory and the failure of a union to comply therewith renders the
strike illegal.32 The union is thus mandated to allege and prove compliance with the requirements of the
law.

In the present case, there is a divergence between the factual findings of the Labor Arbiter, on the one
hand, and the NLRC and the CA, on the other, in that the Labor Arbiter found and declared in his
decision that no secret voting ever took place in the parking lot fronting the hospital on November 10,
1997 by and among the 300 members of the respondent Union. Erwin Barbacena, the overseer of the
only parking lot fronting the hospital, and security guards Simon Tingzon and Reggie Barawid, declared
in their respective affidavits that no secret voting ever took place on November 10, 1997; 17 employees
of the petitioner also denied in their respective statements that they were not members of the
respondent Union, and were asked to merely sign attendance papers and unnumbered votes. The NLRC
and the CA declared in their respective decisions that the affidavits of the petitioner’s 17 employees had
no probative weight because the said employees merely executed their affidavits out of fear of losing
their jobs. The NLRC and the CA anchored their conclusion on their finding that the affidavits of the
employees were uniform and pro forma.

We agree with the finding of the Labor Arbiter that no secret balloting to strike was conducted by the
respondent Union on November 10, 1997 at the parking lot in front of the hospital, at the corner of
Scout Magbanua Street and Panay Avenue, Quezon City. This can be gleaned from the affidavit of
Barbacena and the joint affidavit of Tingzon and Barawid, respectively:

1. That I am working as an overseer of a parking lot owned by Mrs. Madelaine Dionisio and located right
in front of the Capitol Medical Center, specifically at the corner of Scout Magbanua Street and Panay
Avenue, Quezon City;

2. That on November 10, 1997, during my entire tour of duty from 6:00 a.m. to 6:00 p.m., no voting or
election was conducted in the aforementioned parking space for employees of the Capitol Medical
Center and/or their guests, or by any other group for that matter.33

1. That I, Simon J. Tingzon, am a security officer of Veterans Philippine Scout Security Agency
(hereinafter referred to as VPSSA), assigned, since July 1997 up to the present, as Security Detachment
Commander at Capitol Medical Center (hereinafter referred to as CMC) located at Scout Magbanua
corner Panay Avenue, Quezon City;

2. That my (Tingzon) functions as such include over-all in charge of security of all buildings and
properties of CMC, and roving in the entire premises including the parking lots of all the buildings of
CMC;

3. That I, Reggie B. Barawid, am a security guard of VPSSA, assigned, since June 1997 up to the present,
as security guard at CMC;
4. That my (Barawid) functions as such include access control of all persons coming in and out of CMC’s
buildings and properties. I also sometimes guard the parking areas of CMC;

5. That on November 10, 1997, both of us were on duty at CMC from 7:00 a.m. to 7:00 p.m., with me
(Barawid) assigned at the main door of the CMC’s Main Building along Scout Magbanua St.;

6. That on said date, during our entire tour of duty, there was no voting or election conducted in any of
the four parking spaces for CMC personnel and guests.34

The allegations in the foregoing affidavits belie the claim of the respondents and the finding of the NLRC
that a secret balloting took place on November 10, 1997 in front of the hospital at the corner of Scout
Magbanua Street and Panay Avenue, Quezon City. The respondents failed to prove the existence of a
parking lot in front of the hospital other than the parking lot across from it. Indeed, 17 of those who
purportedly voted in a secret voting executed their separate affidavits that no secret balloting took place
on November 10, 1997, and that even if they were not members of the respondent Union, were asked
to vote and to sign attendance papers. The respondents failed to adduce substantial evidence that the
said affiants were coerced into executing the said affidavits. The bare fact that some portions of the said
affidavits are similarly worded does not constitute substantial evidence that the petitioner forced,
intimidated or coerced the affiants to execute the same.

IN LIGHT OF ALL THE FOREGOING, the petition is GRANTED. The Decisions of the Court of Appeals and
NLRC are SET ASIDE AND REVERSED. The Decision of the Labor Arbiter is REINSTATED. No costs.

SO ORDERED.

G.R. No. 103560 July 6, 1995

GOLD CITY INTEGRATED PORT SERVICE, INC. (INPORT), petitioner,

vs.
NATIONAL LABOR RELATIONS COMMISSION (Fifth Division) ADELO EBUNA, EMMANUEL VALMORIDA,
RODOLFO PEREZ, ROGER ZAGADO, MARCOS GANZAN, AND REY VALLE, (WILFREDO DAHAN, ROGELIO
VILLAFUERTE, WILFREDO AMPER, RICARDO ABA, YOLITO AMBUS, FIDEL CALIO, VICENTE CAHATOL,
SOTECO CUENCA, NICOLAS DALAGUAN, BALBINO FAJARDO, ROLANDO JAMILA, RICARDO LAURETO,
RUDY LAURETO, QUIRICO LEJANIO, OSCAR LAPINIG, FELIPE LAURETE, JESUSTUDY OMISOL, ZOSIMO
OMISOL, PEDRO SUAREZ, SATURNINO SISIBAN and MANUEL YANEZ), respondents.

G.R. No. 103599 July 6, 1995

ADELO EBUNA, WILFREDO DAHAN, RICARDO LAURETO, REY VALLE, VICENTE CAHATOL, MARCOS
GANZAN, RODOLFO PEREZ, ROEL SAA, ROGELIO VILLAFUERTE, MANUEL YANEZ, WILFREDO AMPER,
QUIRECO LEJANO, EMMANUEL VALMORIA, ROLANDO JAMILLA, NICOLAS DALAGUAN, BALBINO
FAJARDO, PEDRO SUAREZ, ELPIDIO ESTROGA, RUBEN PAJO, JESUSTODY OMISOL, RICARDO ABA, FIDEL
CALIO, SATURNINO SESYBAN, RUDY LAURETO, OSCAR LAPINIG, FELIPE LAURENTE, ROGER ZAGADO,
SOTECO CUENCA, FIDEL ESLIT, ZOSIMO OMISOL, ANGEL BERNIDO, and MICHAEL
YAGOTYOT, petitioners,
vs.
NATIONAL LABOR RELATIONS COMMISSION, FIFTH DIVISION, and GOLD CITY INTEGRATED PORT
SERVICES, INC. (INPORT), respondents.

ROMERO, J.:

Should separation pay and backwages be awarded by public respondent NLRC to participants of an
illegal strike? This is the core issue to be decided in these two petitions.

Gold City Integrated Port Service, Inc. (INPORT) filed a petition for certiorari against the National Labor
Relations Commission (NLRC) assailing the latter's decision in "Gold City Integrated Port Services, Inc. v.
Adelo Ebuna, et al." (NLRC RAB X Case No. 5-0405-85) with twenty-seven private respondents (G.R. No.
103599).1 This petition has been consolidated with G.R. No. 103599 where the petitioners are the
private respondents in instant case and the private respondent is INPORT. For the sake of clarity,
INPORT shall be denominated in the case at bench as the petitioner and the employees as private
respondents.

Instant case arose from the following facts:

Early in the morning of April 30, 1985, petitioner's employees stopped working and gathered in a mass
action to express their grievances regarding wages, thirteenth month pay and hazard pay. Said
employees were all members of the Macajalar Labor Union — Federation of Free Workers (MLU-FFW)
with whom petitioner had an existing collective bargaining agreement.

Petitioner was engaged in stevedoring and arrastre services at the port of Cagayan de Oro. The strike
paralyzed operations at said port.

On the same morning, the strikers filed individual notices of strike ("Kaugalingon nga Declarasyon sa
Pag-Welga") with the then Ministry of Labor and Employment.

With the failure of conciliation conferences between petitioner and the strikers, INPORT filed a
complaint before the Labor Arbiter for Illegal Strike with prayer for a restraining order/preliminary
injunction.
On May 7, 1985, the National Labor Relations Commission issued a temporary restraining order.
Thereafter, majority of the strikers returned to work, leaving herein private respondents who continued
their protest.2

Counsel for private respondents filed a manifestation that petitioner required prior screening conducted
by the MLU-FFW before the remaining strikers could be accepted back to work.

Meanwhile, counsel for the Macajalar Labor Union (MLU-FFW) filed a "Motion to Drop Most of the Party
Respondents From the Above Entitled Case." The 278 employees on whose behalf the motion was filed,
claimed that they were duped or tricked into signing the individual notices of strike. After discovering
this deception and verifying that the strike was staged by a minority of the union officers and members
and without the approval of, or consultation with, majority of the union members, they immediately
withdrew their notice of strike and returned to work.

The petitioner INPORT, not having interposed any objection, the Labor Arbiter, in his decision dated July
23, 1985, granted their prayer to be excluded as respondents in the complaint for illegal strike.
Moreover, petitioner's complaint was directed against the 31 respondents who did not return to work
and continued with the strike.

For not having complied with the formal requirements in Article 264 of the Labor Code,3 the strike
staged by petitioner's workers on April 30, 1985 was found by the Labor Arbiter to be illegal.4 The
workers who participated in the illegal strike did not, however, lose their employment, since there was
no evidence that they participated in illegal acts. After noting that petitioner accepted the other striking
employees back to work, the Labor Arbiter held that the private respondents should similarly be allowed
to return to work without having to undergo the required screening to be undertaken by their union
(MLU-FFW).

As regards the six private respondents who were union officers, the Labor Arbiter ruled that they could
not have possibly been "duped or tricked" into signing the strike notice for they were active participants
in the conciliation meetings and were thus fully aware of what was going on. Hence, said union officers
should be accepted back to work after seeking reconsideration from herein petitioner.5

The dispositive portion of the decision reads:

IN VIEW OF THE FOREGOING, it is hereby ordered that the strike undertaken by the officers and majority
union members of Macajalar Labor Union-FFW is ILLEGAL contrary to Article 264 of the Labor Code, as
amended. Our conclusion on the employment status of the illegal strikers is subject to our discussion
above.6

Both petitioner and private respondents filed motions for reconsideration, which public respondent
NLRC treated as appeals.7

On January 14, 1991, the NLRC affirmed with modification8 the Arbiter's decision. It held that the
concerted action by the workers was more of a "protest action" than a strike. Private respondents,
including the six union officers, should also be allowed to work unconditionally to avoid discrimination.
However, in view of the strained relations between the parties, separation pay was awarded in lieu of
reinstatement. The decretal portion of the Resolution reads:
WHEREFORE, the decision appealed from is Affirmed with modification in accordance with the foregoing
resolution. Complainant INPORT is hereby ordered, in lieu of reinstatement, to pay respondents the
equivalent of twelve (12) months salaries each as separation pay. Complainant is further ordered to pay
respondents two (2) years backwages based on their last salaries, without qualification or deduction.
The appeal of complainant INPORT is Dismissed for lack of merit.9

Upon petitioner's motion for reconsideration, public respondent modified the above resolution on
December 12, 1991. 10

The Commission ruled that since private respondents were not actually terminated from service, there
was no basis for reinstatement. However, it awarded six months' salary as separation pay or financial
assistance in the nature of "equitable relief." The award for backwages was also deleted for lack of
factual and legal basis. In lieu of backwages, compensation equivalent to P1,000.00 was given.

The dispositive portion of the assailed Resolution reads:

WHEREFORE, the resolution of January 14, 1991 is Modified reducing the award for separation pay to six
(6) months each in favor of respondents, inclusive of lawful benefits as well as those granted under the
CBA, if any, based on the latest salary of respondents, as and by way of financial assistance while the
award for backwages is Deleted and Set Aside. In lieu thereof, respondents are granted compensation
for their sudden loss of employment in the sum of P1,000.00 each. The motion of respondents to
implead PPA as third-party respondent is Noted. Except for this modification the rest of the decision
sought to be reconsidered shall stand. 11

In the instant petitions for certiorari, petitioner alleges that public respondent Commission committed
grave abuse of discretion in awarding private respondents separation pay and backwages despite the
declaration that the strike was illegal.

On the other hand, private respondents, in their petition, assail the reduction of separation pay and
deletion of backwages by the NLRC as constituting grave abuse of discretion.

They also allege that the Resolution of January 14, 1991 could not be reconsidered after the
unreasonable length of time of eleven months.

Before proceeding with the principal issues raised by the parties, it is necessary to clarify public
respondent's statements concerning the strike staged by INPORT's employees.

In its resolution dated January 14, 1991, the NLRC held that the facts prevailing in the case at bench
require a relaxation of the rule that the formal requisites for a declaration of a strike are mandatory.
Furthermore, what the employees engaged in was more of a spontaneous protest action than a strike. 12

Nevertheless, the Commission affirmed the Labor Arbiter's decision which declared the strike illegal.

A strike, considered as the most effective weapon of labor, 13 is defined as any temporary stoppage of
work by the concerted action of employees as a result of an industrial or labor dispute. 14 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 or not the disputants stand in the proximate relation
of employers and employees. 15
Private respondents and their co-workers stopped working and held the mass action on April 30, 1985 to
press for their wages and other benefits. What transpired then was clearly a strike, for the cessation of
work by concerted action resulted from a labor dispute.

The complaint before the Labor Arbiter involved the legality of said strike. The Arbiter correctly ruled
that the strike was illegal for failure to comply with the requirements of Article 264 (now Article 263)
paragraphs (c) and (f) of the Labor Code. 16

The individual notices of strike filed by the workers did not conform to the notice required by the law to
be filed since they were represented by a union (MLU-FFW) which even had an existing collective
bargaining agreement with INPORT.

Neither did the striking workers observe the strike vote by secret ballot, cooling-off period and reporting
requirements.

As we stated in the case of National Federation of Sugar Workers v. Ovejera, 17 the language of the law
leaves no room for doubt that the cooling-off period and the seven-day strike ban after the strike-vote
report were intended to be mandatory. 18

Article 265 of the Labor Code reads, inter alia:

(i)t SHALL be unlawful for any labor organization . . . to declare a strike . . . without first having filed the
notice required in the preceding Article or without the necessary strike vote first having been obtained
and reported to the Ministry. (Emphasis ours)

In explaining the above provision, we said:

In requiring a strike notice and a cooling-off period, the avowed intent of the law is to provide an
opportunity for mediation and conciliation. It thus directs the MOLE to exert all efforts at mediation and
conciliation to effect a voluntary settlement' during the cooling-off period. . . .

xxx xxx xxx

The cooling-off period and the 7-day strike ban after the filing of a strike-vote report, as prescribed in
Art. 264 of the Labor Code, are reasonable restrictions and their imposition is essential to attain the
legitimate policy objectives embodied in the law. We hold that they constitute a valid exercise of the
police power of the state. 19

From the foregoing, it is patent that the strike on April 30, 1985 was illegal for failure to comply with the
requirements of the law.

The effects of such illegal strikes, outlined in Article 265 (now Article 264) of the Labor Code, make a
distinction between workers and union officers who participate therein.

A 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 their
employment status. 20 An ordinary striking worker cannot be terminated for mere participation in an
illegal strike. There must be proof that he committed illegal acts during a strike. A union officer, on the
other hand, may be terminated from work when he knowingly participates in an illegal strike, and like
other workers, when he commits an illegal act during a strike.
In the case at bench, INPORT accepted the majority of the striking workers, including union officers, back
to work. Private respondents were left to continue with the strike after they refused to submit to the
"screening" required by the company. 21

The question to be resolved now is what these remaining strikers, considering the circumstances of the
case, are entitled to receive under the law, if any.

Are they entitled, as they claim, to reinstatement or separation pay and backwages?

In his decision, the Labor Arbiter ordered INPORT to reinstate/accept the remaining workers as well as
to accept the remaining union officers after the latter sought reconsideration from INPORT. 22

The NLRC on January 14, 1991, modified the above decision by ordering INPORT to pay private
respondents the equivalent of twelve months in salary as separation pay in lieu of reinstatement and
two years' backwages. 23

On reconsideration, public respondent modified its original award and reduced the separation pay to six
months, deleted the award for backwages and instead awarded P1,000.00 as compensation for their
sudden loss of employment. 24

Under the law, an employee is entitled to reinstatement and to his full backwages when he is unjustly
dismissed. 25

Reinstatement means restoration to a state or condition from which one had been removed or
separated. Reinstatement and backwages are separate and distinct reliefs given to an illegally dismissed
employee. 26

Separation pay is awarded when reinstatement is not possible, due, for instance, to strained relations
between employer and employee.

It is also given as a form of financial assistance when a worker is dismissed in cases such as the
installation of labor saving devices, redundancy, retrenchment to prevent losses, closing or cessation of
operation of the establishment, or in case the employee was found to have been suffering from a
disease such that his continued employment is prohibited by law. 27

Separation pay is a statutory right defined as the amount that an employee receives at the time of his
severance from the service and is designed to provide the employee with the wherewithal during the
period that he is looking for another employment. 28 It is oriented towards the immediate future, the
transitional period the dismissed employee must undergo before locating a replacement job. 29

Hence, an employee dismissed for causes other than those cited above is not entitled to separation
pay. 30 Well-settled is it that separation pay shall be allowed only in those instances where the employee
is validly dismissed
for causes other than serious misconduct or those reflecting on his moral character. 31

Backwages, on the other hand, is a form of relief that restores the income that was lost by reason of
unlawful dismissal. 32

It is clear from the foregoing summary of legal provisions and jurisprudence that there must generally be
unjust or illegal dismissal from work, before reinstatement and backwages may be granted. And in cases
where reinstatement is not possible or when dismissal is due to valid causes, separation pay may be
granted.

Private respondents contend that they were terminated for failure to submit to the controversial
"screening" requirement.

Public respondent Commission took the opposite view and held:

As the evidence on record will show, respondents were not actually terminated from the service. They
were merely made to submit to a screening committee as a prerequisite for readmission to work. While
this condition was found not wholly justified, the fact remains that respondents who are resistant to
such procedure are partly responsible for the delay in their readmission back to work. Thus, We find
justifiable basis in further modifying our resolution of January 14, 1991 in accordance with the equities
of the case.

We shall therefore recall the award for backwages for lack of factual and legal basis. The award for
separation pay shall likewise (be) reasonably reduced. Normally, severance benefit is granted as an
alternative remedy to reinstatement. And since there is no dismissal to speak of, there is no basis for
awarding reinstatement as a legal remedy. In lieu thereof, We shall grant herein respondents separation
pay as and by way of financial assistance in the nature of an "equitable relief". 33

We find that private respondents were indeed dismissed when INPORT refused to accept them back to
work after the former refused to submit to the "screening" process.

Applying the law (Article 264 of the Labor Code) which makes a distinction, we differentiate between the
union members and the union officers among private respondents in granting the reliefs prayed for.

Under Article 264 of the Labor Code, a worker merely participating in an illegal strike may not be
terminated from his employment. It is only when he commits illegal acts during a strike that he may be
declared to have lost his employment status. Since there appears no proof that these union members
committed illegal acts during the strike, they cannot be dismissed. The striking union members among
private respondents are thus entitled to reinstatement, there being no just cause for their dismissal.

However, considering that a decade has already lapsed from the time the disputed strike occurred, we
find that to award separation pay in lieu of reinstatement would be more practical and appropriate.

No backwages will be awarded to private respondent-union members as a penalty for their participation
in the illegal strike. Their continued participation in said strike, even after most of their co-workers had
returned to work, can hardly be rewarded by such an award.

The fate of private respondent-union officers is different. Their insistence on unconditional

reinstatement or separation pay and backwages is unwarranted and unjustified. For knowingly
participating in an illegal strike, the law mandates that a union officer may be terminated from
employment. 34

Notwithstanding the fact that INPORT previously accepted other union officers and that the screening
required by it was uncalled for, still it cannot be gainsaid that it possessed the right and prerogative to
terminate the union officers from service. The law, in using the word may, grants the employer the
option of declaring a union officer who participated in an illegal strike as having lost his employment. 35
Moreover, an illegal strike which, more often than not, brings about unnecessary economic disruption
and chaos in the workplace should not be countenanced by a relaxation of the sanctions prescribed by
law.

The union officers are, therefore, not entitled to any relief.

However, the above disquisition is now considered moot and academic and cannot be effected in view
of a manifestation filed by INPORT dated May 15, 1987. 36 In said Manifestation, it attached a
Certification by the President of the Macajalar Labor Union (MLU-FFW) to the effect that the private
respondents/remaining strikers have ceased to be members of said union. The MLU-FFW had an existing
collective bargaining agreement with INPORT containing a union security clause. Article 1, Section 2(b)
of the CBA provides:

The corporation shall discharge, dismiss or terminate any employee who may be a member of the Union
but loses his good standing with the Union and or corporation, upon proper notice of such fact made by
the latter; provided, however, . . . after they shall have received the regular appointment as a condition
for his continued employment with the corporation. . . . 37

Since private respondents (union members) are no longer members of the MLU, they cannot be
reinstated. In lieu of reinstatement, which was a proper remedy before May 1987 when they were
dismissed from the union, we award them separation pay. We find that to award one month salary for
every year of service until 1985, after April of which year they no longer formed part of INPORT's
productive work force partly through their own fault, is a fair settlement.

Finally, there is no merit in INPORT's statement that a Resolution of the NLRC cannot be modified upon
reconsideration after the lapse of an unreasonable period of time. Under the present circumstances, a
period of eleven months is not an unreasonable length of time. The Resolution of the public respondent
dated January 14, 1991 did not acquire finality in view of the timely filing of a motion for
reconsideration. Hence, the Commission's modified Resolution issued on December 12, 1991 is valid and
in accordance with law.

In sum, reinstatement and backwages or, if no longer feasible, separation pay, can only be granted if
sufficient bases exist under the law, particularly after a showing of illegal dismissal. However, while the
union members may thus be entitled under the law to be reinstated or to receive separation pay, their
expulsion from the union in accordance with the collective bargaining agreement renders the same
impossible.

The NLRC's award of separation pay as "equitable relief" and P1,000.00 as compensation should be
deleted, these being incompatible with our findings detailed above.

WHEREFORE, from the foregoing premises, the petition in G.R. No. 103560 ("Gold City Integrated Port
Service Inc. v. National Labor Relations Commission, et al.") is GRANTED. One month salary for each year
of service until 1985 is awarded to private respondents who were not union officers as separation pay.
The petition in G.R. No. 103599 ("Adelo Ebuna, et al. v. National Labor Relations Commission, et al.") is
DISMISSED for lack of merit. No costs.

SO ORDERED.
G.R. No. 144315             July 17, 2006

PHILCOM EMPLOYEES UNION, petitioner,

vs.
PHILIPPINE GLOBAL COMMUNICATIONS and PHILCOM CORPORATION, respondents.

DECISION

CARPIO, J.:
The Case

This is a petition for review1 to annul the Decision2 dated 31 July 2000 of the Court of Appeals in CA-G.R.
SP No. 53989. The Court of Appeals affirmed the assailed portions of the 2 October 1998 and 27
November 1998 Orders of the Secretary of Labor and Employment in OS-AJ-0022-97.

The Facts

The facts, as summarized by the Court of Appeals, are as follows:

Upon the expiration of the Collective Bargaining Agreement (CBA) between petitioner Philcom
Employees Union (PEU or union, for brevity) and private respondent Philippine Global Communications,
Inc. (Philcom, Inc.) on June 30, 1997, the parties started negotiations for the renewal of their CBA in July
1997. While negotiations were ongoing, PEU filed on October 21, 1997 with the National Conciliation
and Mediation Board (NCMB) – National Capital Region, a Notice of Strike, docketed as NCMB-NCR-NS
No. 10-435-97, due to perceived unfair labor practice committed by the company (Annex "1", Comment,
p. 565, ibid.). In view of the filing of the Notice of Strike, the company suspended negotiations on the
CBA which moved the union to file on November 4, 1997 another Notice of Strike, docketed as NCMB-
NCR-NS No. 11-465-97, on the ground of bargaining deadlock (Annex "2", Comment, p. 566, ibid.)

On November 11, 1997, at a conciliation conference held at the NCMB-NCR office, the parties agreed to
consolidate the two (2) Notices of Strike filed by the union and to maintain the status quo during the
pendency of the proceedings (Annex "3", Comment, p. 567, ibid.).

On November 17, 1997, however, while the union and the company officers and representatives were
meeting, the remaining union officers and members staged a strike at the company premises,
barricading the entrances and egresses thereof and setting up a stationary picket at the main entrance
of the building. The following day, the company immediately filed a petition for the Secretary of Labor
and Employment to assume jurisdiction over the labor dispute in accordance with Article 263(g) of the
Labor Code.

On November 19, 1997, then Acting Labor Secretary Cresenciano B. Trajano issued an Order assuming
jurisdiction over the dispute, enjoining any strike or lockout, whether threatened or actual, directing the
parties to cease and desist from committing any act that may exacerbate the situation, directing the
striking workers to return to work within twenty-four (24) hours from receipt of the Secretary's Order
and for management to resume normal operations, as well as accept the workers back under the same
terms and conditions prior to the strike. The parties were likewise required to submit their respective
position papers and evidence within ten (10) days from receipt of said order (Annex "4", Comment, pp.
610-611, ibid.). On November 28, 1997, a second order was issued reiterating the previous directive to
all striking employees to return to work immediately.

On November 27, 1997, the union filed a Motion for Reconsideration assailing, among others, the
authority of then Acting Secretary Trajano to assume jurisdiction over the labor dispute. Said motion
was denied in an Order dated January 7, 1998.

As directed, the parties submitted their respective position papers. In its position paper, the union raised
the issue of the alleged unfair labor practice of the company hereunder enumerated as follows:

"(a) PABX transfer and contractualization of PABX service and position;

"(b) Massive contractualization;

"(c) Flexible labor and additional work/function;

"(d) Disallowance of union leave intended for union seminar;

"(e) Misimplementation and/or non-implementation of employees' benefits like shoe allowance,

rainboots, raincoats, OIC shift allowance, P450.00 monthly allowance, driving allowance, motorcycle
award and full-time physician;

"(f) Non-payment, discrimination and/or deprivation of overtime, restday work, waiting/stand by time
and staff meetings;

"(g) Economic inducement by promotion during CBA negotiation;

"(h) Disinformation scheme, surveillance and interference with union affairs;

"(i) Issuance of memorandum/notice to employees without giving copy to union, change in work
schedule at Traffic Records Section and ITTO policies; and

"(j) Inadequate transportation allowance, water and facilities."

(Annex A, Petition; pp. 110-182, ibid.)

The company, on the other hand, raised in its position paper the sole issue of the illegality of the strike
staged by the union (Annex B, Petition; pp. 302-320, ibid.).

On the premise that public respondent Labor Secretary cannot rule on the issue of the strike since there
was no petition to declare the same illegal, petitioner union filed on March 4, 1998 a
Manifestation/Motion to Strike Out Portions of & Attachments in Philcom's Position Paper for being
irrelevant, immaterial and impertinent to the issues assumed for resolution (Annex C, Petition; pp. 330-
333, ibid.).

In opposition to PEU's Manifestation/Motion, the company argued that it was precisely due to the strike
suddenly staged by the union on November 17, 1997 that the dispute was assumed by the Labor
Secretary. Hence, the case would necessarily include the issue of the legality of the strike (Opposition to
PEU'S Motion to Strike Out; Annex F, Petition; pp. 389-393, ibid.).3

On 2 October 1998, the Secretary of Labor and Employment ("Secretary") issued the first assailed order.
The pertinent parts of the Order read:

Going now to the first issue at hand, a reading of the complaints charged by the Union as unfair labor
practices would reveal that these are not so within the legal connotation of Article 248 of the Labor
Code. On the contrary, these complaints are actually mere grievances which should have been
processed through the grievance machinery or voluntary arbitration outlined under the CBA. The issues
of flexible labor and additional functions, misimplementation or non-implementation of employee
benefits, non-payment of overtime and other monetary claims and inadequate transportation
allowance, are all a matter of implementation or interpretation of the economic provisions of the CBA
subject to the grievance procedure.
Neither do these complaints amount to gross violations which, thus, may be treated as unfair labor
practices outside of the coverage of Article 261. The Union failed to convincingly show that there is
flagrant and/or malicious refusal by the Company to comply with the economic provisions stipulated in
the CBA.

With respect to the charges of contractualization and economic inducement, this Office is convinced
that the acts of said company qualify as a valid exercise of management prerogative. The act of the
Company in contracting out work or certain services being performed by Union members should not be
seen as an unfair labor practice act per se. First, the charge of massive contractualization has not been
substantiated while the contractualization of the position of PABX operator is an isolated instance.
Secondly, in the latter case, there was no proof that such contracting out interfered with, restrained or
coerced the employees in the exercise of their right to self-organization. Thus, it is not unfair labor
practice to contract out work for reason of reduction of labor cost through the acquisition of automatic
machines.

Likewise, the promotion of certain employees, who are incidentally members of the Union, to
managerial positions is a prerogative of management. A promotion which is manifestly beneficial to an
employee should not give rise to a gratuitous speculation that such a promotion was made simply to
deprive the union of the membership of the promoted employee (Bulletin Publishing Co. v. Sanchez, et.
al., G.R. No. 74425, October 7, 1986).

There remains the issue on bargaining deadlock. The Company has denied the existence of any impasse
in its CBA negotiations with the Union and instead maintains that it has been negotiating with the latter
in good faith until the strike was initiated. The Union, on the other hand, contends otherwise and
further prays that the remaining CBA proposals of the Union be declared reasonable and equitable and
thus be ordered incorporated in the new CBA to be executed.

As pointed out by the Union, there are already thirty-seven (37) items agreed upon by the parties during
the CBA negotiations even before these were suspended. Prior to this Office's assumption over the case,
the Company furnished the Union its improved CBA counter-proposal on the matter of promotional and
wage increases which however was rejected by the Union as divisive. Even as the Union has submitted
its remaining CBA proposals for resolution, the Company remains silent on the matter. In the absence of
any basis, other than the Union's position paper, on which this Office may make its determination of the
reasonableness and equitableness of these remaining CBA proposals, this Office finds it proper to defer
deciding on the matter and first allow the Company to submit its position thereon.

We now come to the question of whether or not the strike staged by the Union on November 17, 1997
is illegal. The Company claims it is, having been held on grounds which are non-strikeable, during the
pendency of preventive mediation proceedings in the NCMB, after this Office has assumed jurisdiction
over the dispute, and with the strikers committing prohibited and illegal acts. The Company further
prays for the termination of some 20 Union officers who were positively identified to have initiated the
alleged illegal strike. The Union, on the other hand, refuses to submit this issue for resolution.

Considering the precipitous nature of the sanctions sought by the Company, i.e., declaration of illegality
of the strike and the corresponding termination of the errant Union officers, this Office deems it wise to
defer the summary resolution of the same until both parties have been afforded due process. The non-
compliance of the strikers with the return-to-work orders, while it may warrant dismissal, is not by itself
conclusive to hold the strikers liable. Moreover, the Union's position on the alleged commission of illegal
acts by the strikers during the strike is still to be heard. Only after a full-blown hearing may the
respective liabilities of Union officers and members be determined. The case of Telefunken
Semiconductors Employees Union-FFW v. Secretary of Labor and Employment and Temic Telefunken
Micro-Electronics (Phils.), Inc. (G.R. No. 122743 and 127215, December 12, 1997) is instructive on this
point:

It may be true that the workers struck after the Secretary of Labor and Employment had assumed
jurisdiction over the case and that they may have failed to immediately return to work even after the
issuance of a return-to-work order, making their continued strike illegal. For, a return-to-work order is
immediately effective and executory notwithstanding the filing of a motion for reconsideration. But, the
liability of each of the union officers and the workers, if any, has yet to be determined. xxx xxx xxx.4

The dispositive portion of the Order reads:

WHEREFORE, in view of all the foregoing, judgment is hereby rendered as follows:

The Union's Manifestation/Motion to Implead Philcom Corporation is hereby granted. Let summons be
issued to respondent Philcom Corporation to appear before any hearing that may hereafter be
scheduled and to submit its position paper as may be required.

The Union's Manifestation/Motion to Strike Out Portions of and Attachments in Philcom's Position Paper
is hereby denied for lack of merit.

The Union's charges of unfair labor practice against the Company are hereby dismissed.

Pending resolution of the issues of illegal strike and bargaining deadlock which are yet to be heard, all
the striking workers are directed to return to work within twenty-four (24) hours from receipt of this
Order and Philcom and/or Philcom Corporation are hereby directed to unconditionally accept back to
work all striking Union officers and members under the same terms and conditions prior to the strike.
The parties are directed to cease and desist from committing any acts that may aggravate the situation.

Atty. Lita V. Aglibut, Officer-In-Charge of the Legal Service, this Department is hereby designated as the
Hearing Officer to hear and receive evidence on all matters and issues arising from the present labor
dispute and, thereafter, to submit a report/recommendation within twenty (20) days from the
termination of the proceedings.

The parties are further directed to file their respective position papers with Atty. Lita V. Aglibut within
ten (10) days from receipt of this Order.

SO ORDERED.5

Philcom Corporation ("Philcom") filed a motion for reconsideration. Philcom prayed for reconsideration
of the Order impleading it as party-litigant in the present case and directing it to accept back to work
unconditionally all the officers and members of the union who participated in the strike.6 Philcom also
filed a Motion to Certify Labor Dispute to the National Labor Relations Commission for Compulsory
Arbitration.7
For its part, Philcom Employees Union (PEU) filed a Motion for Partial Reconsideration. PEU asked the
Secretary to "partially reconsider" the 2 October 1998 Order insofar as it dismissed the unfair labor
practices charges against Philcom and included the illegal strike issue in the labor dispute.8

The Secretary denied both motions for reconsideration of Philcom and PEU in its assailed Order of 27
November 1998. The pertinent parts of the Order read:

The question of whether or not Philcom Corporation should be impleaded has been properly disposed of
in the assailed Order. We reiterate that neither the Company herein nor its predecessor was able to
convincingly establish that each is a separate entity in the absence of any proof that there was indeed
an actual closure and cessation of the operations of the predecessor-company. We would have
accommodated the Company for a hearing on the matter had it been willing and prepared to submit
evidence to controvert the finding that there was a mere merger. As it now stands, nothing on record
would prove that the two (2) companies are separate and distinct from each other.

Having established that what took place was a mere merger, we correspondingly conclude that the
employer-employee relations between the Company and the Union officers and members was never
severed. And in merger, the employees of the merged companies or entities are deemed absorbed by
the new company (Filipinas Port Services, Inc. v. NLRC, et. al., G.R. No. 97237, August 16, 1991).
Considering that the Company failed miserably to adduce any evidence to provide a basis for a contrary
ruling, allegations to the effect that employer-employee relations and positions previously occupied by
the workers no longer exist remain just that — mere allegations. Consequently, the Company cannot
now exempt itself from compliance with the Order. Neither can it successfully argue that the employees
were validly dismissed. As held in Telefunken Semiconductor Employees Union-FFW v. Secretary of
Labor and Employment (G.R. Nos. 122743 and 122715, December 12, 1997), to exclude the workers
without first ascertaining the extent of their individual participation in the strike or non-compliance with
the return-to-work orders will be tantamount to dismissal without due process of law.

With respect to the unfair labor practice charges against the Company, we have carefully reviewed the
records and found no reason to depart from the findings previously rendered. The issues now being
raised by the Union are the same issues discussed and passed upon in our earlier Order.

Finally, it is our determination that the issue of the legality of the strike is well within the jurisdiction of
this Office. The same has been properly submitted and assumed jurisdiction by the Office for resolution.9

The dispositive portion of the Order reads:

WHEREFORE, there being no merit in the remaining Motions for Reconsideration filed by both parties,
the same are hereby DENIED. Our 2 October 1998 Order STANDS. To expedite the resolution of the
Motion to Certify Labor Dispute to the NLRC for Compulsory Arbitration, Philcom Employees Union is
hereby directed to submit its Opposition thereto within ten (10) days from receipt of the copy of this
Order.

SO ORDERED.10

PEU filed with this Court a petition for certiorari and prohibition under Rule 65 of the Rules of Court
assailing the Secretary's Orders of 2 October 1998 and 27 November 1998. This Court, in accordance
with its Decision of 10 March 1999 in G.R. No. 123426 entitled National Federation of Labor (NFL) vs.
Hon. Bienvenido E. Laguesma, Undersecretary of the Department of Labor and Employment, and
Alliance of Nationalist Genuine Labor Organization, Kilusang Mayo Uno (ANGLO-KMU),11 referred the
case to the Court of Appeals.12

The Ruling of the Court of Appeals

On 31 July 2000, the Court of Appeals rendered judgment as follows:

WHEREFORE, PREMISES CONSIDERED, this petition is hereby DENIED. The assailed portions of the
Orders of the Secretary of Labor and Employment dated October 2, 1998 and November 27, 1998 are
AFFIRMED.

SO ORDERED.13

The Court of Appeals ruled that, contrary to PEU's view, the Secretary could take cognizance of an issue,
even only incidental to the labor dispute, provided the issue must be involved in the labor dispute itself
or otherwise submitted to him for resolution.

The Court of Appeals pointed out that the Secretary assumed jurisdiction over the labor dispute upon
Philcom's petition as a consequence of the strike that PEU had declared and not because of the notices
of strike that PEU filed with the National Conciliation and Mediation Board (NCMB).

The Court of Appeals stated that the reason of the Secretary's assumption of jurisdiction over the labor
dispute was the staging of the strike. Consequently, any issue regarding the strike is not merely
incidental to the labor dispute between PEU and Philcom, but also part of the labor dispute itself. Thus,
the Court of Appeals held that it was proper for the Secretary to take cognizance of the issue on the
legality of the strike.

The Court of Appeals also ruled that for an employee to claim an unfair labor practice by the employer,
the employee must show that the act charged as unfair labor practice falls under Article 248 of the
Labor Code. The Court of Appeals held that the acts enumerated in Article 248 relate to the workers'
right to self-organization. The Court of Appeals stated that if the act complained of has nothing to do
with the acts enumerated in Article 248, there is no unfair labor practice.

The Court of Appeals held that Philcom's acts, which PEU complained of as unfair labor practices, were
not in any way related to the workers' right to self-organization under Article 248 of the Labor Code. The
Court of Appeals held that PEU's complaint constitutes an enumeration of mere grievances which should
have been threshed out through the grievance machinery or voluntary arbitration outlined in the
Collective Bargaining Agreement (CBA).

The Court of Appeals also held that even if by Philcom's acts, Philcom had violated the provisions of the
CBA, still those acts do not constitute unfair labor practices under Article 248 of the Labor Code. The
Court of Appeals held that PEU failed to show that those violations were gross or that there was flagrant
or malicious refusal on the part of Philcom to comply with the economic provisions of the CBA.

The Court of Appeals stated that as of 21 March 1989, as held in PAL vs. NLRC,14 violations of CBAs will
no longer be deemed unfair labor practices, except those gross in character. Violations of CBAs, except
those gross in character, are mere grievances resolvable through the appropriate grievance machinery
or voluntary arbitration as provided in the CBAs.
Hence, this petition.

The Issues

In assailing the Decision of the Court of Appeals, petitioner contends that:

1. The Honorable Court of Appeals has failed to faithfully adhere with the decisions of the Supreme
Court when it affirmed the order/resolution of the Secretary of Labor denying the Union's
Manifestation/Motion to Strike Out Portions of & Attachments in Philcom's Position Paper and including
the issue of illegal strike notwithstanding the absence of any petition to declare the strike illegal.

2. The Honorable Court of Appeals has decided a question of substance in a way not in accord with law
and jurisprudence when it affirmed the order/resolution of the Secretary of Labor dismissing the Union's
charges of unfair labor practices.

3. The Honorable Court of Appeals has departed from the edict of applicable law and jurisprudence
when it failed to issue such order mandating/directing the issuance of a writ of execution directing the
Company to unconditionally accept back to work the Union officers and members under the same terms
and conditions prior to the strike and as well as to pay their salaries/backwages and the monetary
equivalent of their other benefits from October 6, 1998 to date.15

The Ruling of the Court

The petition must fail.

PEU contends that the Secretary should not have taken cognizance of the issue on the alleged illegal
strike because it was not properly submitted to the Secretary for resolution. PEU asserts that after
Philcom submitted its position paper where it raised the issue of the legality of the strike, PEU
immediately opposed the same by filing its Manifestation/Motion to Strike Out Portions of and
Attachments in Philcom's Position Paper. PEU asserts that it stated in its Manifestation/Motion that
certain portions of Philcom's position paper and some of its attachments were "irrelevant, immaterial
and impertinent to the issues assumed for resolution." Thus, PEU asserts that the Court of Appeals
should not have affirmed the Secretary's order denying PEU's Manifestation/Motion.

PEU also contends that, contrary to the findings of the Court of Appeals, the Secretary's assumption of
jurisdiction over the labor dispute was based on the two notices of strike that PEU filed with the NCMB.
PEU asserts that only the issues on unfair labor practice and bargaining deadlock should be resolved in
the present case.

PEU insists that to include the issue on the legality of the strike despite its opposition would convert the
case into a petition to declare the strike illegal.

PEU's contentions are untenable.

The Secretary properly took cognizance of the issue on the legality of the strike. As the Court of Appeals
correctly pointed out, since the very reason of the Secretary's assumption of jurisdiction was PEU's
declaration of the strike, any issue regarding the strike is not merely incidental to, but is essentially
involved in, the labor dispute itself.

Article 263(g) of the Labor Code provides:

When, in his opinion, there exists a labor dispute causing or likely to cause a strike or lockout in an
industry indispensable to the national interest, the Secretary of Labor and Employment may assume
jurisdiction over the dispute and decide it or certify the same to the Commission for compulsory
arbitration. Such assumption or certification shall have the effect of automatically enjoining the
intended or impending strike or lockout as specified in the assumption or certification order. If one has
already taken place at the time of assumption or certification, all striking or locked out employees shall
immediately return to work and the employer shall immediately resume operations and readmit all
workers under the same terms and conditions prevailing before the strike or lockout. The Secretary of
Labor and Employment or the Commission may seek the assistance of law enforcement agencies to
ensure the compliance with this provision as well as with such orders as he may issue to enforce the
same.

x x x x.

The powers granted to the Secretary under Article 263(g) of the Labor Code have been characterized as
an exercise of the police power of the State, with the aim of promoting public good.16 When the
Secretary exercises these powers, he is granted "great breadth of discretion" in order to find a solution
to a labor dispute. The most obvious of these powers is the automatic enjoining of an impending strike
or lockout or its lifting if one has already taken place.17

In this case, the Secretary assumed jurisdiction over the dispute because it falls in an industry
indispensable to the national interest. As noted by the Secretary.

[T]he Company has been a vital part of the telecommunications industry for 73 years. It is particularly
noted for its expertise and dominance in the area of international telecommunications. Thus, it
performs a vital role in providing critical services indispensable to the national interest. It is for this very
reason that this Office strongly opines that any concerted action, particularly a prolonged work stoppage
is fraught with dire consequences. Surely, the on-going strike will adversely affect not only the livelihood
of workers and their dependents, but also the company's suppliers and dealers, both in the public and
private sectors who depend on the company's facilities in the day-to-day operations of their businesses
and commercial transactions. The operational viability of the company is likewise adversely affected,
especially its expansion program for which it has incurred debts in the approximate amount of P2 Billion.
Any prolonged work stoppage will also bring about substantial losses in terms of lost tax revenue for the
government and would surely pose a serious set back in the company's modernization program.

At this critical time when government is working to sustain the economic gains already achieved, it is the
paramount concern of this Office to avert any unnecessary work stoppage and, if one has already
occurred, to minimize its deleterious effect on the workers, the company, the industry and national
economy as a whole.18

It is of no moment that PEU never acquiesced to the submission for resolution of the issue on the
legality of the strike. PEU cannot prevent resolution of the legality of the strike by merely refusing to
submit the issue for resolution. It is also immaterial that this issue, as PEU asserts, was not properly
submitted for resolution of the Secretary.

The authority of the Secretary to assume jurisdiction over a labor dispute causing or likely to cause a
strike or lockout in an industry indispensable to national interest includes and extends to all questions
and controversies arising from such labor dispute. The power is plenary and discretionary in nature to
enable him to effectively and efficiently dispose of the dispute.19

Besides, it was upon Philcom's petition that the Secretary immediately assumed jurisdiction over the
labor dispute on 19 November 1997.20 If petitioner's notices of strike filed on 21 October and 4
November 1997 were what prompted the assumption of jurisdiction, the Secretary would have issued
the assumption order as early as those dates.

Moreover, after an examination of the position paper21 Philcom submitted to the Secretary, we see no
reason to strike out those portions which PEU seek to expunge from the records. A careful study of all
the facts alleged, issues raised, and arguments presented in the position paper leads us to hold that the
portions PEU seek to expunge are necessary in the resolution of the present case.

On the documents attached to Philcom's position paper, except for Annexes MM-2 to MM-22
inclusive22 which deal with the supposed consolidation of Philippine Global Communications, Inc. and
Philcom Corporation, we find the other annexes relevant and material in the resolution of the issues
that have emerged in this case.

PEU also claims that Philcom has committed several unfair labor practices. PEU asserts that there are
"factual and evidentiary bases" for the charge of unfair labor practices against Philcom.

On unfair labor practices of employers, Article 248 of the Labor Code provides:

Unfair labor practices of employers. - It shall be unlawful for an employer to commit any of the
following unfair labor practice:

(a) To interfere with, restrain or coerce employees in the exercise of their right to self-organization;

(b) To require as a condition of employment that a person or an employee shall not join a labor
organization or shall withdraw from one to which he belongs;

(c) To contract out services or functions being performed by union members when such will interfere
with, restrain or coerce employees in the exercise of their rights to self-organization;

(d) To initiate, dominate, assist or otherwise interfere with the formation or administration of any labor
organization, including the giving of financial or other support to it or its organizers or supporters;

(e) To discriminate 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. x x x

(f) To dismiss, discharge, or otherwise prejudice or discriminate against an employee for having given or
being about to give testimony under this Code;

(g) To violate the duty to bargain collectively as prescribed by this Code;

(h) To pay negotiation or attorney's fees to the union or its officers or agents as part of the settlement of
any issue in collective bargaining or any other dispute; or

(i) To violate a collective bargaining agreement.

Unfair labor practice refers to acts that violate the workers' 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.23 The only exception is Article 248(f),
which in any case is not one of the acts specified in PEU's charge of unfair labor practice.

A review of the acts complained of as unfair labor practices of Philcom convinces us that they do not fall
under any of the prohibited acts defined and enumerated in Article 248 of the Labor Code. The issues of
misimplementation or non-implementation of employee benefits, non-payment of overtime and other
monetary claims, inadequate transportation allowance, water, and other facilities, are all a matter of
implementation or interpretation of the economic provisions of the CBA between Philcom and PEU
subject to the grievance procedure.

We find it pertinent to quote certain portions of the assailed Decision, thus —

A reading of private respondent's justification for the acts complained of would reveal that they were
actually legitimate reasons and not in anyway related to union busting. Hence, as to compelling
employees to render flexible labor and additional work without additional compensation, it is the
company's explanation that the employees themselves voluntarily took on work pertaining to other
assignments but closely related to their job description when there was slack in the business which
caused them to be idle. This was the case of the International Telephone Operators who tried
telemarketing when they found themselves with so much free time due to the slowdown in the demand
for international line services. With respect to the Senior Combination Technician at the Cebu branch
who was allegedly made to do all around work, the same happened only once when the lineman was
absent and the lineman's duty was his ultimate concern. Moreover, the new assignment of the
technicians at CTSS who were promoted to QCE were based on the job description of QCE, while those
of the other technicians were merely temporary due to the promotion of several technicians to QCE
(pars. 9-12, Philcom's Reply to PEU's Position Paper; Annex "E", Petition; pp. 350-351, ibid.).

On the alleged misimplementation and/or non-implementation of employees' benefits, such as shoe

allowance, rainboots, raincoats, OIC shift allowance, P450.00 monthly allowance, driving allowance,
motorcycle award and full-time physician, the company gave the following explanation which this Court
finds plausible, to wit:

16. The employees at CTSS were given One Thousand Pesos (P1,000.00) cash or its equivalent in
purchase orders because it was their own demand that they be given the option to buy the pair of
leather boots they want. For the Cebu branch, the employees themselves failed to include these
benefits in the list of their demands during the preparation of the budget for the year 1997 despite the
instruction given to them by the branch manager. According to the employees, they were not aware
that they were entitled to these benefits. They thought that because they have been provided with two
vans to get to their respective assignments, these benefits are available only to collectors, messengers
and technicians in motorcycles.

17. The P450.00 monthly allowance was provided by the CBA to be given to counter clerks. However,
the position of counter clerks had been abolished in accordance with the reorganization plan
undertaken by the company in April 1995, with the full knowledge of the Union membership. As a result
of the abolition of the position of counter clerks, there was no more reason for granting the subject
allowance.
18. The company more than satisfied the provision in the CBA to engage the services of a physician and
provided adequate medical services. Aside from a part time physician who reports for duty everyday,
the company has secured the services of Prolab Diagnostics, which has complete medical facilities and
personnel, to serve the medical needs of the employees. x x x

19. The Union demands that a full-time physician to be assigned at the Head Office. This practice, is not
provided in the CBA and, moreover is too costly to maintain. The medical services offered by Prolab
[D]iagnostics are even better and more comprehensive than any full time physician can give. It places at
the employees' disposal numerous specialists in various fields of medicine. It is beyond understanding
why the Union would insist on having a full-time physician when they could avail of better services from
Prolab Diagnostics.

(Philcom's Reply to PEU's Position Paper, pp.352, 354, ibid.)

On the issue of non-payment, discrimination and/or deprivation of overtime, restday work,

waiting/stand by time and staff meeting allowance, suffice it to state that there is nothing on record to
prove the same. Petitioner did not present evidence substantial enough to support its claim.

As to the alleged inadequate transportation allowance and facilities, the company posits that:

30. The transportation allowances given to the Dasmarinas and Pinugay employees are more than
adequate to defray their daily transportation cost. Hence, there is absolutely no justification for an
increase in the said allowance. In fact, said employees at Dasmarinas and Pinugay, who are only residing
in areas near their place of work, are more privileged as they receive transportation expenses while the
rest of the company workers do not.

31. As to the demand for clean drinking water, the company has installed sufficient and potable water
inside the Head Office even before the strike was staged by the Union. Any person who visits the Makati
Head Office can attest to this fact.

(Philcom's Reply to PEU's Position Paper, p. 357, ibid.)

Anent the allegation of PABX transfer and contractualization of PABX service and position, these were
done in anticipation of the company to switch to an automatic PABX machine which requires no
operator. This cannot be treated as ULP since management is at liberty, absent any malice on its part, to
abolish positions which it deems no longer necessary (Arrieta vs. National Labor Relations Commission,
279 SCRA 326, 332). Besides, at the time the company hired a temporary employee to man the machine
during daytime, the subject position was vacant while the assumption of the function by the company
guard during nighttime was only for a brief period.

With respect to the perceived massive contractualization of the company, said charge cannot be
considered as ULP since the hiring of contractual workers did not threaten the security of tenure of
regular employees or union members. That only 160 employees out of 400 employees in the company's
payroll were considered rank and file does not of itself indicate unfair labor practice since this is but a
company prerogative in connection with its business concerns.

Likewise, the offer or promotions to a few union members is neither unlawful nor an economic
inducement. These offers were made in accordance with the legitimate need of the company for the
services of these employees to fill positions left vacant by either retirement or resignation of other
employees. Besides, a promotion is part of the career growth of employees found competent in their
work. Thus, in Bulletin Publishing Corporation vs. Sanchez (144 SCRA 628, 641), the Supreme Court held
that "(T)he promotion of employees to managerial or executive positions rests upon the discretion of
management. Managerial positions are offices which can only be held by persons who have the trust of
the corporation and its officers. It is the prerogative of management to promote any individual working
within the company to a higher position. It should not be inhibited or prevented from doing so. A
promotion which is manifestly beneficial to an employee should not give rise to a gratuitous speculation
that such a promotion was made simply to deprive the union of the membership of the promoted
employee, who after all appears to have accepted his promotion."

That the promotions were made near or around the time when CBA negotiations were about to be held
does not make the company's action an unfair labor practice. As explained by the company, these
promotions were based on the availability of the position and the qualification of the employees
promoted (p. 6, Annex "4", Philcom's Reply to PEU's Position Paper; p. 380, ibid.)

On the union's charge that management disallowed leave of union officers and members to attend
union seminar, this is belied by the evidence submitted by the union itself. In a letter to PEU's President,
the company granted the leave of several union officers and members to attend a seminar
notwithstanding that its request to be given more details about the affair was left unheeded by the
union (Annex "Y", PEU's Position Paper; p. 222, ibid.). Those who were denied leave were urgently
needed for the operation of the company.

On the ULP issue of disinformation scheme, surveillance and interference with union affairs, these are
mere allegations unsupported by facts. The charge of "black propaganda" allegedly committed by the
company when it supposedly posted two (2) letters addressed to the Union President is totally baseless.
Petitioner presents no proof that it was the company which was behind the incident. On the purported
disallowance of union members to observe the July 27, 1997 CBA meeting, the company explained that
it only allowed one (1) employee from ITTO, instead of two (2), as it would adversely affect the
operation of the group. It also took into consideration the fact that ITTO members represent only 20% of
the union. Other union members from other departments of the company should have equal
representation (Annex "L", Position Paper for the Union; pp. 205-206, ibid.). As to the alleged
surveillance of the company guards during a union seminar, We find the idea of sending guards to spy
on a mere union seminar quite preposterous. It is thus not likely for the company which can gain
nothing from it to waste its resources in such a scheme.

On the issuance of memorandum/notice to employees without giving copy to union, change in work
schedule at Traffic Records Section and ITTO policies, the company has sufficiently rebutted the same,
thus:

27. The Union also whines about the failure of the company to furnish copies of memoranda or notices
sent to employees and change of work schedules at the Traffic Records Section and ITTO policies. The
CBA, however, does not obligate the Company to give the Union a copy of each and every memorandum
or notice sent to employees. This would be unreasonable and impractical. Neither did the Union
demand that they be furnished copies of the same. This is clearly a non-issue as copies of all memoranda
or notices issued by management are readily available upon request by any employee or the Union.
28. Contrary to the allegations of the Union, the rationale and mechanics for the abolishment of the
midnight schedule at the Traffic Record Services had been thoroughly and adequately discussed with the
Union's President, Robert Benosa, and the staff of Traffic Record Services in the meeting held on May 9,
1997. The midnight services were abolished for purely economic reasons. The company realized that the
midnight work can be handled in the morning without hampering normal operations. At the same time,
the company will be able to save on cost. For this objective, the employees concerned agreed to create
a manning and shifting schedule starting at 6:00 a.m. up to 10:00 p.m., with each employee rendering
only eight hours of work every day without violating any provision of the labor laws or the CBA.24

The Court has always respected a company's exercise of its prerogative to devise means to improve its
operations. Thus, we have held that management is free to regulate, according to its own discretion and
judgment, all aspects of employment, including hiring, work assignments, supervision and transfer of
employees, working methods, time, place and manner of work.25

This is so because the law on unfair labor practices is not intended to deprive employers of their
fundamental right to prescribe and enforce such rules as they honestly believe to be necessary to the
proper, productive and profitable operation of their business.26

Even assuming arguendo that Philcom had violated some provisions in the CBA, there was no showing
that the same was a flagrant or malicious refusal to comply with its economic provisions. The law
mandates that such violations should not be treated as unfair labor practices.27

PEU also asserts that the Court of Appeals should have issued an order directing the issuance of a writ of
execution ordering Philcom to accept back to work unconditionally the striking union officers and
members under the same terms and conditions prevailing before the strike. PEU asserts that the union
officers and members should be paid their salaries or backwages and monetary equivalent of other
benefits beginning 6 October 1998 when PEU received a copy of the Secretary's 2 October 1998 return-
to-work order.

PEU claims that even if the "issue of illegal strike can be included in the assailed orders and that the
union officers and members have been terminated as a result of the alleged illegal strike, still, the
Secretary has to rule on the illegality of the strike and the liability of each striker." PEU asserts that the
union officers and members should first be accepted back to work because a return-to-work order is
immediately executory.28

We rule on the legality of the strike if only to put an end to this protracted labor dispute. The facts
necessary to resolve the legality of the strike are not in dispute.

The strike and the strike activities that PEU had undertaken were patently illegal for the following
reasons:

1. Philcom is engaged in a vital industry protected by Presidential Decree No. 823 (PD 823), as amended
by Presidential Decree No. 849, from strikes and lockouts. PD 823, as amended, provides:

Sec. 1. It is the policy of the State to encourage free trade unionism and free collective bargaining within
the framework of compulsory and voluntary arbitration. Therefore, all forms of strikes, picketings and
lockouts are hereby strictly prohibited in vital industries, such as in public utilities, including
transportation and communications, x x x. (Emphasis supplied)
Enumerating the industries considered as vital, Letter of Instruction No. 368 provides:

For the guidance of workers and employers, some of whom have been led into filing notices of strikes
and lockouts even in vital industries, you are hereby instructed to consider the following as vital
industries and companies or firms under PD 823 as amended:

1. Public Utilities:

xxxx

B. Communications:

1) Wire or wireless telecommunications such as telephone, telegraph, telex, and cable companies or
firms; (Emphasis supplied)

xxxx

It is therefore clear that the striking employees violated the no-strike policy of the State in regard to vital
industries.

2. The Secretary had already assumed jurisdiction over the dispute. Despite the issuance of the return-
to-work orders dated 19 November and 28 November 1997, the striking employees failed to return to
work and continued with their strike.

Regardless of their motives, or the validity of their claims, the striking employees should have ceased or
desisted from all acts that would undermine the authority given the Secretary under Article 263(g) of
the Labor Code. They could not defy the return-to-work orders by citing Philcom's alleged unfair labor
practices to justify such defiance.29

PEU could not have validly anchored its defiance to the return-to-work orders on the motion for
reconsideration that it had filed on the assumption of jurisdiction order. A return-to-work order is
immediately effective and executory despite the filing of a motion for reconsideration. It must be
strictly complied with even during the pendency of any petition questioning its validity.30

The records show that on 22 November 1997, Philcom published in the Philippine Daily Inquirer a notice
to striking employees to return to work.31 These employees did not report back to work but continued
their mass action. In fact, they lifted their picket lines only on 22 December 1997.32 Philcom formally
notified twice these employees to explain in writing why they should not be dismissed for defying the
return-to-work order.33 Philcom held administrative hearings on these disciplinary cases.34 Thereafter,
Philcom dismissed these employees for abandonment of work in defiance of the return-to-work order.35

A return-to-work order imposes a duty that must be discharged more than it confers a right that may be
waived. While the workers may choose not to obey, they do so at the risk of severing their relationship
with their employer.36

The following provision of the Labor Code governs the effects of defying a return-to-work order:

ART. 264. Prohibited activities. ─ (a) x x x x

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 x x x x

Any union officer who knowingly participates in 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. (Emphasis supplied)

A strike undertaken despite the Secretary's issuance of an assumption or certification order becomes
a prohibited activity, and thus, illegal, under Article 264(a) of the Labor Code. The union officers who
knowingly participate in the illegal strike are deemed to have lost their employment status. The union
members, including union officers, who commit specific illegal acts or who knowingly defy a return-to-
work order are also deemed to have lost their employment status.37 Otherwise, the workers will simply
refuse to return to their work and cause a standstill in the company operations while retaining the
positions they refuse to discharge and preventing management to fill up their positions.38

Hence, the failure of PEU's officers and members to comply immediately with the return-to-work orders
dated 19 November and 28 November 1997 cannot be condoned. Defiance of the return-to-work
orders of the Secretary constitutes a valid ground for dismissal.39

3. PEU staged the strike using unlawful means and methods.

Even if the strike in the present case was not illegal per se, the strike activities that PEU had undertaken,
especially the establishment of human barricades at all entrances to and egresses from the company
premises and the use of coercive methods to prevent company officials and other personnel from
leaving the company premises, were definitely illegal.40 PEU is deemed to have admitted that its officers
and members had committed these illegal acts, as it never disputed Philcom's assertions of PEU's
unlawful strike activities in all the pleadings that PEU submitted to the Secretary and to this Court.

PEU's picketing officers and members prohibited other tenants at the Philcom building from entering
and leaving the premises. Leonida S. Rabe, Country Manager of Societe Internationale De
Telecommunications Aeronautiques (SITA), a tenant at the Philcom building, wrote two letters addressed
to PEU President Roberto B. Benosa. She told Benosa that PEU's act of obstructing the free ingress to
and egress from the company premises "has badly disrupted normal operations of their organization."41

The right to strike, while constitutionally recognized, is not without legal constrictions. Article 264(e) of
the Labor Code, on prohibited activities, provides:

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.

The Labor Code is emphatic against the use of violence, coercion, and intimidation during a strike and to
this end prohibits the obstruction of free passage to and from the employer's premises for lawful
purposes. A picketing labor union has no right to prevent employees of another company from getting in
and out of its rented premises, otherwise, it will be held liable for damages for its acts against an
innocent by-stander.42

The sanction provided in Article 264(a) is so severe that 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.43

By insisting on staging the prohibited strike and defiantly picketing Philcom's premises to prevent the
resumption of company operations, the striking employees have forfeited their right to be readmitted.44

4. PEU declared the strike during the pendency of preventive mediation proceedings at the NCMB.

On 17 November 1997, while a conciliation meeting was being held at the NCMB in NCMB-NCR-NS 10-
435-97, PEU went on strike. It should be noted that in their meeting on 11 November 1997, both
Philcom and PEU were even "advised to maintain the status quo."45 Such disregard of the mediation
proceedings was a blatant violation of Section 6, Book V, Rule XXII of the Omnibus Rules Implementing
the Labor Code, which explicitly obliges the parties to bargain collectively in good faith and prohibits
them from impeding or disrupting the proceedings.46 The relevant provision of the Implementing Rules
provides:

Section 6. Conciliation. ─ x x x x

During the proceedings, the parties shall not do any act which may disrupt or impede the early
settlement of dispute. They are obliged, as part of their duty, to bargain collectively in good faith, to
participate fully and promptly in the conciliation meetings called by the regional branch of the Board. x x
xx

Article 264(a) of the Labor Code also considers it a prohibited activity to declare a strike "during the
pendency of cases involving the same grounds for the same strike."

Lamentably, PEU defiantly proceeded with their strike during the pendency of the conciliation
proceedings.

5. PEU staged the strike in utter disregard of the grievance procedure established in the CBA.

By PEU's own admission, "the Union's complaints to the management began in June 1997 even before
the start of the 1997 CBA renegotiations."47 Their CBA expired on 30 June 1997.48 PEU could have just
taken up their grievances in their negotiations for the new CBA. This is what a Philcom officer had
suggested to the Dasmariñas staff when the latter requested on 16 June 1997 for an increase in
transportation allowance.49 In fact, when PEU declared the strike, Philcom and PEU had already agreed
on 37 items in their negotiations for the new CBA.50

The bottom line is that PEU should have immediately resorted to the grievance machinery provided for
in the CBA.51 In disregarding this procedure, the union leaders who knowingly participated in the strike
have acted unreasonably. The law cannot interpose its hand to protect them from the consequences of
their illegal acts.52

A strike declared on the basis of grievances which have not been submitted to the grievance committee
as stipulated in the CBA of the parties is premature and illegal.53
Having held the strike illegal and having found that PEU's officers and members have committed illegal
acts during the strike, we hold that no writ of execution should issue for the return to work of PEU
officers who participated in the illegal strike, and PEU members who committed illegal acts or who
defied the return-to-work orders that the Secretary issued on 19 November 1997 and 28 November
1997. The issue of who participated in the illegal strike, committed illegal acts, or defied the return-to-
work orders is a question of fact that must be resolved in the appropriate proceedings before the
Secretary of Labor.

WHEREFORE, we DISMISS the petition and AFFIRM the Decision of the Court of Appeals in CA-G.R. SP

No. 53989, with the MODIFICATION that the Secretary of Labor is directed to determine who among the
Philcom Employees Union officers participated in the illegal strike, and who among the union members
committed illegal acts or defied the return-to-work orders of 19 November 1997 and 28 November
1997. No pronouncement as to costs.

SO ORDERED.

G.R. No. 160058             June 22, 2007

PILIPINO TELEPHONE CORPORATION, petitioner,

vs.
PILIPINO TELEPHONE EMPLOYEES ASSOCIATION (PILTEA), PELAGIO S. BRIONES II, GEORGE L. DE LEON,
LECEL M. FIDEL, AUGUSTO C. FRANCISCO, OLIVER B. ANTONIO, RONALDO B. CORONEL, CHRISTOPHER
L. HERRERA and GEM TORRES, respondents.
x-----------------------------x

G.R. No. 160094             June 22, 2007

PILIPINO TELEPHONE EMPLOYEES ASSOCIATION (PILTEA), PELAGIO S. BRIONES II, GEORGE L. DE LEON,
and GEM TORRES, petitioners,
vs.
NATIONAL LABOR RELATIONS COMMISSION and PILIPINO TELEPHONE CORPORATION, respondents.

DECISION

PUNO, C.J.:

At bar are two consolidated petitions seeking review of the decision1 and resolution2 of the Court of
Appeals (CA) in CA-G.R. SP No. 59799 which modified the decision3 of the National Labor Relations
Commission (NLRC) by affirming the illegality of the strike conducted by Pilipino Telephone Employees
Association (the Union) but reducing the penalty against union officers Pelagio S. Briones II, George De
Leon, Lecel M. Fidel and Gem Torres from dismissal to suspension for six (6) months.

First, we unfurl the facts.

The Collective Bargaining Agreement (CBA) between the Union and Pilipino Telephone Corporation (the
Company) was due to expire on December 31, 1997. On October 30, 1997, the Union submitted to the
Company its proposals for the renegotiation of the non-representation aspects of their CBA. As there
was a standstill on several issues, the parties submitted their dispute to the National Conciliation and
Mediation Board (NCMB) for preventive mediation.4 The conciliation proceedings before the NCMB
failed.

On July 13, 1998, the Union filed a Notice of Strike5 with the NCMB for unfair labor practice due to the
alleged acts of "restraint and coercion of union members and interference with their right to self-
organization" committed by the Company's Revenue Assurance Department (RAD) Manager Rosales and
its Call Center Department Manager, Manny Alegado, to wit:

1. Requiring employees to execute undated resignation letters prior to regularization as a condition for
continued employment.

2. Preventing employees from displaying Union flags and CBA's slogans.

3. Prohibiting employees from conducting and preventing employees from participating in Union
activities.

4. Requiring employees to render forced overtime to prevent them from attending Union meetings and
activities after office hours.

5. Using vulgar and insulting language such as "Kahit sa puwet n'yo isaksak ang mga banderang yan!"

6. Threatening employees who join concerted Union activities with disciplinary action.

7. Discouraging employees from participating in Union activities by branding the activities illegal and
prohibited by law.
8. Abuse of Company Rules and Regulations to prevent the free exercise by the Union and its members
of their right to self organization and free expression (e.g. issuing show cause memos for refusal to
render overtime and vandalism).

9. Utilizing security guards to harass employees who participate in Union activities by requiring the
guards to take down the names of employees who participate in the Union activities.6

The Company filed a petition for Consolidated Assumption of Jurisdiction with the Office of the Secretary
of Labor. On August 14, 1998, then Secretary Bienvenido E. Laguesma issued an Order, the dispositive
portion of which states:

WHEREFORE, premises considered, this Office hereby assumes jurisdiction over the entire labor
dispute at Pilipino Telephone Corporation pursuant to Art. 263(g) of the Labor Code, as amended.

Accordingly, any strike or lockout, whether actual or intended, is hereby enjoined.

Furthermore, the parties are likewise directed to cease and desist from committing any or all acts that
might exacerbate the situation.

To expedite the resolution of the dispute, the parties are hereby directed to file their respective position
papers and documentary evidence within TEN (10) days from receipt of this Order.

SO ORDERED.7 (Emphases supplied.)

On September 4, 1998, the Union filed a second Notice of Strike8 with the NCMB on the grounds of: a)
union busting, for the alleged refusal of the Company to turn over union funds; and b) the mass
promotion of union members during the CBA negotiation, allegedly aimed at excluding them from the
bargaining unit during the CBA negotiation. On the same day, the Union went on strike.

On September 9, 1998, Secretary Laguesma directed the striking Union officers and members to return
to work within twenty-four (24) hours from receipt of the Order and for the Company to accept all
strikers under the same terms and conditions of employment prior to the strike. The Union and its
members complied.

On December 7, 1998, the Company filed with the NLRC a petition9 to declare the Union's September 4,
1998 strike illegal. On August 16, 1999, Labor Arbiter Aliman D. Mangandog issued a decision, the
dispositive portion of which states:

WHEREFORE, premises considered, the September 4, 1998 strike conducted by PILTEA is declared illegal.

Accordingly, the following union officers of PILTEL/MKP, namely: George de Leon, Pelagio S. Briones,
Nelson C. Pineda, Rolando U. Sta. Ana, Elna E. Escalante, Gem P. Torres, Ma. Rica D. Hilotin, Gerald
Joseph P. Tayas, Lecel M. Fidel and Jose Rudylin R. Gamboa are declared to have lost their employment
status.

While the following members, namely: Romeo Anonuevo, Jonathan Molaer, Cris Herrera, Edgar Alan
Aquino, Aris Ablis, Dorothy Zulieta, Ronald Cornel, Arnel Garcia, Ranelio Mendoza, Oliver Antonio, Alvin
Usman, Augusto Francisco, Celia Mogol and Erlinda Madrid are hereby suspended for six (6) months
without pay.

SO ORDERED.10
The Labor Arbiter found the strike illegal for having been conducted in defiance of Secretary Laguesma's
August 14, 1998 assumption order and for non-compliance with the procedural requirements for the
conduct of a strike under the Labor Code and its implementing rules. The Labor Arbiter
cited Scholastica's College v. Ruben Torres11 which ruled that a strike undertaken despite the issuance
of an assumption or certification order by the Secretary of Labor is a prohibited activity, hence, illegal
under Article 264 of the Labor Code. He found that the grounds relied upon by the Union in its second
notice of strike were substantially the same as those set forth in its first notice of strike. Moreover, he
held that the Company's alleged refusal to turn over the checked-off union dues was not a strikeable
issue as it was not a gross and blatant violation of the economic provisions of the CBA. He also held that
the mass promotion of the Union's members was not tantamount to dismissal, hence, did not constitute
union busting. The staging of the strike was likewise found to suffer from fatal procedural defects, to
wit: a) the notice of strike was filed on the same day that the strike was conducted; b) the fifteen (15)-
day cooling-off period was not observed; c) the Union failed to conduct a strike vote within the time
prescribed by law; and d) the result of the strike vote was not furnished to the NCMB at least seven (7)
days prior to the intended strike. Certain illegal acts were likewise found to have been committed during
the strike, among which were the following: 1) striker Manny Costales prevented the Company's
Director, Lilibeth Pasa, from entering the Bankers Centre Building; 2) union officers Judilyn Gamboa and
Rolly Sta. Ana physically blocked the front entrance of the same building; 3) striker Aris Ablis drove a
company vehicle and used it to block the driveway of PILTEL Centre II, thus, the cars inside the building
were prevented from going out. The tires of said company vehicle were found deflated the following
day; 4) strikers Dorothy Zulieta and Ronald Cornel prevented the Warehousing Manager assigned at the
PILTEL Metropolitan Warehouse from going out of his office; 5) the strikers, led by Nelson Pineda,
blocked the Detachment Supervisor of Protection Specialists and the uniformed company guards from
delivering food to the non-striking employees trapped inside PILTEL Call Center at the Manila Memorial
Park Building; 6) in General Santos City, some union members tied the entrance doors of the PILTEL
Building and tied the company vehicles together; 7) Fe Carandang, Estrella Anonical, Zaldy Logos and
Jovencio Laderas blocked the main entrance of the Boac, Marinduque office of the Company; 8) strikers
Edna Carrion, Celia Mogol, Erlinda Madrid, Raul Montalan, Rolly Miraflor, Zaldy de Chavez and Dina
Madla of the Company's office in Boac, Marinduque were also heard telling the Company's clients not to
transact business with the company; and 9) strikers Zaldy Logos, Rizaldy de Chavez, Raul Montalan, Rolly
Milaflor and Jovencio Laderas were seen preventing the free ingress and egress of the Company's office
premises in Boac, Marinduque. The Labor Arbiter ruled that since the September 4, 1998 strike was
illegal, the Union officers were deemed to have lost their employment status. He further ruled that the
illegal acts committed during the strike were not serious enough to merit the dismissal of the erring
Union members as they were merely acting at the order of their leaders. Hence, the erring union
members were merely suspended for six (6) months.

On appeal, the NLRC affirmed the decision of the Labor Arbiter in toto.12 The Union, its dismissed officers
and its suspended members filed a motion for reconsideration, to no avail.13

The Union, its officers Briones, De Leon, Fidel and Torres, and its members Francisco, Antonio, Coronel
and Herrera filed a Petition for Certiorari under Rule 65 of the Rules of Court with the CA, attributing
grave abuse of discretion amounting to excess of jurisdiction on the part of the NLRC.14 On September
20, 2002, the CA modified the ruling of the NLRC as follows:
WHEREFORE, the assailed decision of the NLRC dated February 29, 2000 is MODIFIED. Petitioners
Pelagio S. Briones, George L. De Leon, Lecel M. Fidel and Gem Torres shall be suspended for six (6)
months without pay instead of being dismissed. If already dismissed, petitioners shall be reinstated back
to their former positions, or, if already filled, then to any other equal positions and shall be entitled to
backwages computed from date of dismissal until date of actual reinstatement less the pay for the six
(6) months suspension they were supposed to serve. The suspension of petitioners Augusto C. Francisco,
Oliver B. Antonio, Ronaldo B. Coronel and Christopher L. Herrera for six (6) months without pay and the
finding of illegality of the September 4, 1998 strike STANDS.

SO ORDERED.15

Both parties filed their respective partial motions for reconsideration - the company assailed the CA
decision decreasing the penalty of the union officers while the Union and its dismissed officers assailed
the decision declaring the strike illegal. Both motions were denied.16

Hence, the instant petitions.

In G.R. No. 160058, the Company raises the issue of:

[WHETHER] THE ASSAILED 20 SEPTEMBER 2002 DECISION AND 17 SEPTEMBER 2003 RESOLUTION OF
THE COURT OF APPEALS ARE CONTRARY TO LAW AND JURISPRUDENCE.17

It prays that the September 20, 2002 Decision and September 17, 2003 Resolution of the CA be reversed
in part and judgment be rendered affirming in toto the February 29, 2000 Decision of the NLRC.

In G.R. No. 160094, the Union and Union officers Briones, De Leon and Torres raise the issue of:

[WHETHER] THE HONORABLE COURT OF APPEALS COMMITTED REVERSIBLE ERROR IN UPHOLDING

NLRC'S FINDING THAT THE 4 SEPTEMBER 1998 STRIKE HELD BY PILTEA WAS ILLEGAL AS IT IS NOT IN
ACCORDANCE WITH EXISTING LAW OR JURISPRUDENCE.18

They pray that this Court modify the September 20, 2002 Decision and September 17, 2003 Resolution
of the CA and: a) declare the Union's September 4, 1998 strike as legal; b) nullify the six-month
suspension imposed on Briones, De Leon and Torres; and c) order the Company to pay them backwages
covering the period of their suspension.

The twin issues to be resolved are: a) the legality of the Union's strike and b) the penalty to be imposed
on the Union officers, if any.

First, the legality of the strike.

The Union and its officers maintain that their September 4, 1998 strike was legal. They allege that the
Company was guilty of union busting in promoting a substantial number of Union members and officers
to positions outside the bargaining unit during the period of CBA negotiations. Allegedly, said Union
members and officers maintained the same jobs and duties despite their promotion. They also capitalize
on the CA's finding that the company was guilty of unfair labor practice in refusing to turn over the
deducted contingency fees of the union members to the union. Citing Bacus v. Ople,19 Panay Electric
Company v. NLRC20 and PNOC Dockyard and Engineering Corporation v. NLRC,21 they contend that this
finding of unfair labor practice precludes the CA from ruling that the strike was illegal and that the Union
was in bad faith in conducting the strike.
These arguments do not sway.

Article 263 of the Labor Code, as amended by Republic Act (R.A.) No. 6715,22 and Rule XXII, Book V of the
Omnibus Rules Implementing the Labor Code outline the following procedural requirements for a valid
strike:

1) A notice of strike, with the required contents, should be filed with the DOLE, specifically the Regional
Branch of the NCMB, copy furnished the employer of the union;

2) A cooling-off period must be observed between the filing of notice and the actual execution of the
strike thirty (30) days in case of bargaining deadlock and fifteen (15) days in case of unfair labor practice.
However, in the case of union busting where the union's existence is threatened, the cooling-off period
need not be observed.

xxx xxx xxx

4) Before a strike is actually commenced, a strike vote should be taken by secret balloting, with a 24-
hour prior notice to NCMB. The decision to declare a strike requires the secret-ballot approval of
majority of the total union membership in the bargaining unit concerned.

5) The result of the strike vote should be reported to the NCMB at least seven (7) days before the
intended strike or lockout, subject to the cooling-off period.23

It is settled that these requirements are mandatory in nature and failure to comply therewith renders
the strike illegal.24

In the case at bar, the Union staged the strike on the same day that it filed its second notice of strike.
The Union violated the seven-day strike ban. This requirement should be observed to give the
Department of Labor and Employment (DOLE) an opportunity to verify whether the projected strike
really carries the approval of the majority of the union members. 25

Moreover, we agree with the CA that there was no union busting which would warrant the non-
observance of the cooling-off period. To constitute union busting under Article 263 of the Labor Code,
there must be: 1) a dismissal from employment of union officers duly elected in accordance with the
union constitution and by-laws; and 2) the existence of the union must be threatened by such dismissal.
In the case at bar, the second notice of strike filed by the Union merely assailed the "mass promotion" of
its officers and members during the CBA negotiations. Surely, promotion is different from dismissal. As
observed by the Labor Arbiter:

x x x Neither does that (sic) PILTEL's promotion of some members of respondent union constitutes (sic)
union busting which could be a valid subject of strike because they were not being dismissed. In fact,
these promoted employees did not personally come forward to protest their promotion vis-à-vis their
alleged option to remain in the union bargaining unit of the rank and filers.26

This is consistent with our ruling in Bulletin Publishing Corporation v. Sanchez27 that a promotion which
is manifestly beneficial to an employee should not give rise to a gratuitous speculation that it was made
to deprive the union of the membership of the benefited employee.

The contention of the Union and its officers that the finding of unfair labor practice by the CA precludes
the ruling that the strike was illegal is unmeritorious. The refusal of the Company to turn over the
deducted contingency funds to the union does not justify the disregard of the mandatory seven-day
strike ban and the 15-day cooling-off period.

The Union's reliance on Bacus v. Ople,28 Panay Electric Company v. NLRC29 and PNOC Dockyard and
Engineering Corporation v. NLRC30 is likewise unavailing.

Nowhere in Panay Electric Company and PNOC Dockyard and Engineering Corporation did the Court
rule that the procedural requirements for a valid strike may be dispensed with if the striking workers
believed in good faith that the company was committing acts of unfair labor practice. In both cases, the
striking union members complied with the procedural requirements for a valid strike. It is correct that
this Court, in Bacus, held that "a strike staged by the workers inspired by good faith does not
automatically make the same illegal," but said case was decided before the effectivity of R.A. No. 6715
on March 21, 1989. We have ruled that with the enactment of R.A. No. 6715, the requirements as to the
filing of a notice of strike, strike vote, and notice given to the DOLE are mandatory in nature.31

Moreover, we agree with the NLRC that the subject strike defied the assumption order of the Secretary
of Labor. The NLRC correctly affirmed the Labor Arbiter that the second notice of strike was based on
substantially the same grounds as the first notice of strike. The Union and its officers and members
alleged that the mass promotion of the union officers and members and the non-remittance of the
deducted contingency fees were the reasons for their concerted activities which annoyed the
Company's RAD Manager and made him commit acts of unfair labor practice, eventually leading to the
Union's filing of the first notice of strike. Clearly then, the issues which were made as grounds for the
second notice of strike, viz, the mass promotion of the union members and officers and the non-
remittance of the deducted contingency fees, were already existing when the Secretary of Labor
assumed jurisdiction over the entire labor dispute between the Company and the Union on August 14,
1998.

Article 264 of the Labor Code provides:

Art. 264. Prohibited activities.—x x x

No strike or lockout shall be declared after assumption of jurisdiction by the President or the Secretary
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.

Having settled that the subject strike was illegal, we shall now determine the proper penalty to be
imposed on the union officers who knowingly participated in the strike.

Both the Labor Arbiter and the NLRC imposed the penalty of dismissal on the striking union officers after
finding that: a) the strike was illegal for having been conducted in defiance of Secretary Laguesma's
August 14, 1998 Order of assumption of jurisdiction and for non-compliance with the procedural
requirements for the conduct of a strike under the Labor Code and its implementing rules; b) the
grounds relied upon by the Union in its second notice of strike were substantially the same as those set
forth in its first notice of strike; c) the Company's alleged refusal to turn over the checked-off union dues
was not a strikeable issue as it was not a gross and blatant violation of the economic provisions of the
CBA; d) the mass promotion of the Union's members was also not tantamount to dismissal, hence, did
not constitute union busting; and e) certain illegal acts were found to have been committed during the
strike.
On the other hand, the CA reduced the penalty of the union officers from dismissal to suspension for six
months after finding that the "supreme penalty of dismissal" imposed on union officers Briones, De
Leon, Fidel and Torres was "so harsh" considering that the Union did not defy the Secretary of Labor's
Assumption Order and that the Company did not have "clean hands" when it filed the instant case for
having committed an unfair labor practice by refusing to turn over the union dues to the Union.

We find that the CA committed a reversible error in modifying the rulings of the Labor Arbiter and the
NLRC.

For a petition for certiorari under Rule 65 of the Rules of Court to prosper, the tribunal, board or officer
exercising judicial or quasi-judicial functions must be proven to have acted without or in excess of its or
his jurisdiction, or with grave abuse of discretion amounting to lack or excess of jurisdiction.32 "Grave
abuse of discretion" has been defined as "a capricious and whimsical exercise of judgment as is
equivalent to lack of jurisdiction. Mere abuse of discretion is not enough, it must be so grave as when
the power is exercised in an arbitrary or despotic manner by reason of passion or personal hostility, and
must be so patent and so gross as to amount to an evasion of a positive duty or to a virtual refusal to
perform the duty enjoined or to act at all in contemplation of law."33

We note that although the CA modified the ruling of the NLRC, nowhere in its decision did it attribute
grave abuse of discretion to the NLRC. And rightly so.

Article 264 of the Labor Code further provides:

Art. 264. Prohibited activities.— x x x

Any workers whose employment has been terminated as a consequence of an unlawful lockout shall be
entitled to reinstatement with full back wages. Any union officer who knowingly participates in 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. x x x

We have explained the meaning of this provision as follows:

The effects of illegal strikes, as outlined in Article 264 of the Labor Code, make a distinction between
ordinary workers and union officers who participate therein. Under established jurisprudence, a union
officer may be terminated from employment for knowingly participating in an illegal strike. The fate of
union members is different. Mere participation in an illegal strike is not a sufficient ground for
termination of the services of the union members. The Labor Code protects ordinary, rank-and-file union
members who participated in such a strike from losing their jobs provided that they did not commit
illegal acts during the strike.34

In Gold City Integrated Port Service, Inc. v. NLRC,35 the Court held that "[t]he law, in using the
word may, grants the employer the option of declaring a union officer who participated in an illegal
strike as having lost his employment." Thus, in a number of cases,36 proof that an employee who
knowingly participated in an illegal strike is a union officer was enough to warrant his dismissal from
employment.
This rule was relaxed in the case of PAL v. Brillantes37 where the Court "invoke[d] its judicial prerogative
to resolve disputes in a way to render to each interested party the most judicious solution, and in the
ultimate scheme, a resolution of a dispute tending to preserve the greater order of society." In said case,
the Court dismissed the petition of PAL seeking the termination from employment of certain Union
members and officers who staged a strike in violation of the Secretary of Labor's return-to-work order.
The Court found that both parties contributed to the volatile atmosphere that emerged despite the
Secretary of Labor's status quo order as PAL terminated en masse the employment of 183 union officers
and members. It noted the finding of the Acting Secretary of Labor that PAL "did not come to this office
with 'clean hands' in seeking the termination of the officers and members of PALEA who participated in
the 16 June 1994 strike."38

This Court exercised this judicial prerogative sparingly in Nissan Motors Philippines, Inc. v. Secretary of
Labor.39 In said case, the Court also found Nissan equally guilty of exacerbating the situation after the
assumption order of the Secretary for suspending a substantial number of Union officers and members
with threat of eventual dismissal and perceived illegal lockout and union busting. However, while it
affirmed the ruling of the Secretary of Labor suspending the union members who participated in the
illegal strike, the Court sustained the dismissal of the union officers, viz:

While the employer is authorized to declare a union officer who participated in an illegal strike as having
lost his employment, his/its option is not as wide with respect to union members or workers for the law
itself draws a line and makes a distinction between union officers and members/ordinary workers. An
ordinary striking worker or union member cannot, as a rule, be terminated for mere participation in an
illegal strike; there must be proof that he committed illegal acts during the strike.40

The Court further explained the reason:

x x x Thus in Association of Independent Union in the Philippines vs. NLRC,41 we held that the
responsibility of union officers, as main players in an illegal strike, is greater than that of the
members and, therefore, limiting the penalty of dismissal only for the former for participation in an
illegal strike is in order. Of the same tenor, albeit formulated a bit differently is our holding in Gold City
Integrated Port Service, Inc. vs. NLRC.42 (Emphasis supplied.)

In the case at bar, we do not find any reason to deviate from our rulings in Gold City Integrated Port
Service, Inc. and Nissan Motors Philippines, Inc. It bears emphasis that the strike staged by the Union in
the instant case was illegal for its procedural infirmities and for defiance of the Secretary's assumption
order. The CA, the NLRC and the Labor Arbiter were unanimous in finding that bad faith existed in the
conduct of the subject strike. The relevant portion of the CA Decision states:

x x x We cannot go to the extent of ascribing good faith to the means taken in conducting the strike.
The requirement of the law is simple, that is—1. Give a Notice of Strike; 2. Observe the cooling period; 3.
Observe the mandatory seven day strike ban; 3. If the act is union busting, then the union may strike
doing away with the cooling-off period, subject only to the seven-day strike ban. To be lawful, a strike
must simply have a lawful purpose and should be executed through lawful means. Here, the union
cannot claim good faith in the conduct of the strike because, as can be gleaned from the findings of
the Labor Arbiter, this was an extensively coordinated strike having been conducted all through out
the offices of PILTEL all over the country. Evidently, the strike was planned. Verily, they cannot now
come to court hiding behind the shield of "good faith." Be that as it may, petitioners claim good faith
only in so far as their grounds for the strike but not on the conduct of the strike. Consequently, they still
had to comply with the procedural requirements for a strike, which, in this case, they failed to do so.43

Thus, in imposing the penalty of dismissal, the NLRC correctly held:

x x x the point We wish to stress is that the [open, blatant] and willful defiance by the respondents of
the Order emanating from the Secretary of Labor and Employment in this labor dispute only goes to
show that the respondents have little or no regard at all for lawful orders from duly constituted
authorities. For what their officers and members have suffered they have no one else to blame.44

It cannot be overemphasized that strike, as the most preeminent economic weapon of the workers to
force management to agree to an equitable sharing of the joint product of labor and capital, exert some
disquieting effects not only on the relationship between labor and management, but also on the general
peace and progress of society and economic well-being of the State.45 This weapon is so critical that the
law imposes the supreme penalty of dismissal on union officers who irresponsibly participate in an
illegal strike and union members who commit unlawful acts during a strike. The responsibility of the
union officers, as main players in an illegal strike, is greater than that of the members as the union
officers have the duty to guide their members to respect the law.46 The policy of the state is not to
tolerate actions directed at the destabilization of the social order, where the relationship between labor
and management has been endangered by abuse of one party's bargaining prerogative, to the extent of
disregarding not only the direct order of the government to maintain the status quo, but the welfare of
the entire workforce though they may not be involved in the dispute. The grave penalty of dismissal
imposed on the guilty parties is a natural consequence, considering the interest of public welfare.47

IN VIEW WHEREOF, the petition in G.R. No. 160094 is DENIED. The petition in G.R. No. 160058
is GRANTED. The Decision and Resolution of the CA in CA-G.R. SP No. 59799 dated September 20, 2002
and September 17, 2003, respectively, are REVERSED and the Decision and Resolution of the NLRC
dated February 29, 2000 and April 28, 2000, respectively, are REINSTATED.

SO ORDERED.

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

SHELL OIL WORKERS' UNION, petitioner,

vs.
SHELL COMPANY OF THE PHILIPPINES, LTD., and THE COURT OF INDUSTRIAL RELATIONS, respondents.
J.C. Espinas, B. C. Pineda, J. J. de la Rosa & Associates for petitioner.

Siguion Reyna, Montecillo, Belo & Ongsiako for respondent Company.

FERNANDO, J.:

The insistence on the part of respondent Shell Company of the Philippines to dissolve its security guard
section, stationed at its Pandacan Installation notwithstanding its being embraced in, and its
continuance as such thus assured by an existing collective bargaining contract, resulted in a strike called
by petitioner Shell Oil Workers' Union, hereinafter to be designated as the Union, certified a month later
on June 27, 1967 by the President to respondent Court of Industrial Relations. Against its decision
declaring the strike illegal primarily on the ground that such dissolution was a valid exercise of a
management prerogative, this appeal is taken. With due Recognition that the system of industrial
democracy fostered in the regime of unionization and collective bargaining leaves room for the free
exercise of management rights, but unable to close our eyes to the violation of a contract still in force
implicit in such dissolution thus giving rise to an unfair labor practice, we cannot sustain respondent
Court of Industrial Relations. Consequently, the harsh and unwarranted sanction imposed, the dismissal
of the security guards and the officers of the Union, cannot stand. Insofar, however, as individual liability
is deemed incurred for serious acts of violence, whether committed by a leader or member of the
Union, we leave things as adjudged.

The deep-rooted differences between the parties that led to the subsequent strike were made clear in
the presidential certification. As set forth in the opening paragraph of the decision now on appeal:
"Before this Court for resolution is the labor dispute between the petitioner Shell Oil Workers' Union,
Union for brevity, and the respondent Shell Company of the Philippines Limited, Company for short,
which was certified to this Court on June 27, 1967 by the Office of the President of the Republic of the
Philippines pursuant to the provision of Section 10 of Republic Act No. 875. Said dispute ... 'was a result
of the transfer by the Company of the eighteen (18) security guards to its other department and the
consequent hiring of a private security agency to undertake the work of said security guards.'"1

The respective contentions of the parties were then taken up. Petitioner "filed the petition on July 7,
1967 alleging, among others, that the eighteen (18) security guards affected are part of the bargaining
unit and covered by the existing collective bargaining contract, and as such, their transfers and eventual
dismissals are illegal being done in violation of the existing contract. It, therefore, prayed that said
security guards be reinstated with full back wages from the time of their dismissal up to the time of their
actual reinstatement."2 Then came a summary of the stand Of Shell Company: "For hours hereafter,
respondent Company filed its Answer [to] the material allegations in the Union's petition and adverted
that the issues in this case are: (1) whether or not the Company commits unfair labor practice in
contracting out its security service to an independent professional security agency and assigning the 18
guards to other sections of the Company; (2) whether or not the dismissal of the 18 security guards are
justified; and (3) whether or not (the strike called by the Union on May 25, 1967 is legal. As special and
affirmative defenses, the Company maintained that in contracting out the security service and
redeploying the 18 security guards affected, it was merely performing its legitimate prerogative to adopt
the most efficient and economical method of operation; that said guards were transferred to other
sections with increase, except for four (4) guards, in rates of pay and with transfer bonus; the said action
was motivated by business consideration in line with past established practice and made after notice to
and discussion with the Union; that the 18 guards concerned were dismiss for wilfully refusing to obey
the transfer order; and that the strike staged by the Union on May 25, 1967 is illegal. Primarily,
Company prayed, among others, for the dismissal of the Union's petition and the said Union's strike be
declared illegal followed by the termination of the employee status of those responsible and who
participated in said illegal strike."3

The move for the dissolution of the security section by reassigning the guards to other positions and
contracting out such service to an outside security agency had its origins as far back as 1964. A study
made by the Shell Company for the purpose of improving the productivity, organization and efficiency of
its Pandacan Installation recommended its dissolution. If an outside agency to perform such service
were to be hired, there would be a savings of P96,000.00 annually in addition to further economy
consequent on the elimination to overtime an administration expenses. Its implementation was
scheduled for 1965.4 There was then, in July 1966, a joint consultation by the Union and management on
the matter. At that stage, it would appear that there was no serious opposition to such a move provided
it be done gradually and in close consultation with the Union. There was even an offer if cooperation as
long as a scheme for retirement of the security guards affected or their redeployment would be
followed.5

The tentative character of such proposed dissolution was made evident by the fact however that on
August 26, 1966, a collective bargaining contract was executed between the Union and the Shell
Company effective from the first of the month of that year to December 31, 1969. It contained the usual
grievance procedure and no strike clauses.6 More relevant to the case before this Court, however, was
the inclusion of the category of the security guards in such collective bargaining contract. This was
stressed in the brief for the petitioner where specific mention is made of the agreement covering rank
and file personnel regularly employed by the Company, included in which is the work area covered by
the Pandacan Installation.7 There was likewise specific reference to such positions in the wage schedule
for hourly-rated categories appearing in an appendix thereof.8 Mention was expressly made in another
appendix of the regular remuneration as well as premium pay and night compensation.9 Nonetheless,
Shell Company was bent on doing away with the security guard section, to be replaced by an outside
security agency. That was communicated to the Union in a panel to panel meeting on May 3, 1967. A
counter-offer on the part of the Union to reduce the working days per week of the guards from six to
five was rejected by Shell Company on the ground of its being unusual and impracticable. Two days
later, there was a meeting of the Union where a majority of the members made clear that should there
be such a replacement of the company guards by a private security agency, there would be a strike. It
was noted in the decision that when the strike vote was taken, of 243 members, 226 were for the
approval of a motion to that effect. 10 On the afternoon of May 24, 1967, a notice of reassignment
effective at 8:00 o'clock the next morning was handed to the guards affected. At 10:00 o'clock that
evening, there was a meeting by the Union attended by ten officers and a majority of the members
wherein it was agreed viva voce that if there would be an implementation of the circular dissolving the
security section to be replaced by guards from an outside agency, the Union would go on strike
immediately. 11 The strike was declared at half-past 7:00 o'clock in the morning of May 25, 1967 when
security guards from an outside agency were trying to pass the main gate of the Shell Company to their
work. With the picket line established, they were unable to enter. Efforts were made by the Conciliation
Service of the Department of Labor to settle the matter, but they were unsuccessful. 12 It was not until
June 27, 1967, however, that the Presidential certification came. 13 There was a return to work order on
July 6, 1967 by respondent Court, by virtue of which pending the resolution of the case, the Shell
Company was not to lockout the employees involved and the employees in turn were not to strike.

The decision of respondent Court was rendered on August 5, 1967. It declared that no unfair labor
practice was committed by Shell Company in dissolving its security guards from an outside agency, as
such a step was well within management prerogative. Hence for it, the strike was illegal, there being no
compliance with the statutory requisites before an economic strike could be staged. Respondent Court
sought to reinforce such a conclusion by a finding that its purpose was not justifiable and that it was
moreover carried out with violence. There was thus a failure on its part to accord due weight to the
terms of an existing collective bargaining agreement. Accordingly as was made clear in the opening
paragraph of this opinion we view matters differently. The strike cannot be declared illegal, there being
a violation of the collective bargaining agreement by Shell Company. Even if it were otherwise, however,
this Court cannot lend sanction of its approval to the outright dismissal of all union officers, a move that
certainly would have the effect of considerably weakening a labor organization, and thus in effect
frustrate the policy of the Industrial Peace Act to encourage unionization. To the extent, however, that
the serious acts of violence occurring in the course of the strike could be made the basis for holding
responsible a leader or a member of the Union guilty of their commission, what was decided by
respondent Court should not be disturbed.

1. It is the contention of Shell Company, sustained by respondent Court, that the dissolution of the
security guard section to be replaced by an outside agency is a management prerogative. The Union
argues otherwise, relying on the assurance of the continued existence of a security guard section at least
during the lifetime of the collective bargaining agreement. The second, third and fourth assignment of
errors, while they could have been more felicitously worded, did attack the conclusion reached by
respondent Court as contrary to and in violation of the existing contract. It is to be admitted that the
stand of Shell Company as to the scope of management prerogative is not devoid of plausibility if it were
not bound by what was stipulated. The growth of industrial democracy fostered by the institution of
collective bargaining with the workers entitled to be represented by a union of their choice, has no
doubt contracted the sphere of what appertains solely to the employer. It would be going too far to
assert, however, that a decision on each and every aspect of the productive process must be reached
jointly by an agreement between labor and management. Essentially, the freedom to manage the
business remains with management. It still has plenty of elbow room for making its wishes prevail. In
much the same way that labor unions may be expected to resist to the utmost what they consider to be
an unwelcome intrusion into their exclusive domain, they cannot justly object to management equally
being jealous of its prerogatives.

More specifically, it cannot be denied the faculty of promoting efficiency and attaining economy by a
study of what units are essential for its operation. To it belongs the ultimate determination of whether
services should be performed by its personnel or contracted to outside agencies. it is the opinion of the
Court, that while management has the final say on such matter, the labor union is not to be completely
left out. What was done by Shell Company in informing the Union as to the step it was intending to take
on the proposed dissolution of the security guard section to be replaced by an outside agency is praise-
worthy. There should be mutual consultation eventually deference is to be paid to what management
decides. Thereby, in the words of Chief Justice Warren, there is likely to be achieved "peaceful
accommodation of conflicting interest." 14 In this particular case though, what was stipulated in an
existing collective bargaining contract certainly precluded Shell Company from carrying out what
otherwise would have been within its prerogative if to do so would be violative thereof.

2. The crucial question thus is whether the then existing collective bargaining contract running for three
years from August 1, 1966 to December 31, 1969 constituted a bar to such a decision reached by
management? The answer must be in the affirmative. As correctly stressed in the brief for the
petitioner, there was specific coverage concerning the security guard section in the collective bargaining
contract. It is found not only in the body thereof but in the two appendices concerning the wage
schedules as well as the premium pay and the night compensation to which the personnel in such
section were entitled. 15 It was thus an assurance of security of tenure, at least, during the lifetime of the
agreement. Nor is it a sufficient answer, as set forth in the decision of respondent Court, that while such
a section would be abolished, the guards would not be unemployed as they would be transferred to
another position with an increase in pay and with a transfer bonus. For what is involved is the integrity
of the agreement reached, the terms of which should be binding of both parties. One of them may be
released, but only with the consent of the other. The right to object belongs to the latter, and if
exercised, must be respected. Such a state of affairs should continue during the existence of the
contract. Only thus may there be compliance with and fulfillment of the covenants in a valid subsisting
agreement.

What renders the stand of Shell Company even more vulnerable is the fact that as set forth in its brief
and as found by respondent Court as far back as 1964, it had already been studying the matter of
dissolving the security guard section and contracting out such service to an outside agency. Apparently,
it had reached a decision to that effect for implementation the next year. In July 1966, there was a joint
consultation between it and the Union on the matter. Nonetheless on August 26, 1966, a collective
bargaining contract was entered into which, as indicated above, did assure the continued existence of
the security guard section. The Shell Company did not have to agree to such a stipulation. Or it could
have reserved the right to effect a dissolution and reassign the guards. It did not do so. Instead, when it
decided to take such a step resulting in the strike, it would rely primarily on provisions in the collective
bargaining contract couched in general terms, merely declaratory of certain management prerogatives.
Considering the circumstances of record, there can be no justification then for Shell Company's
insistence on pushing through its project of such dissolution without thereby incurring a violation of the
collective bargaining agreement.

3. The Shell Company, in failing to manifest fealty to what was stipulated in an existing collective
bargaining contract, was thus guilty of an unfair labor practice. Such a doctrine first found expression
in Republic Savings Bank v. Court of Industrial Relations, 16 the opinion of the Court being penned by
Justice Castro. There was a reiteration of such a view in Security Bank Employees Union v. Security Bank
and Trust Company. 17 Thus: "It being expressly provided in the industrial Peace Act that [an] unfair labor
practice is committed by a labor union or its agent by its refusal 'to bargain collectively with the
employer' and this Court having decided in the Republic Savings Bank case that collective bargaining
does not end with the execution of an agreement, being a continuous process, the duty to bargain
necessarily imposing on the parties the obligation to live up to the terms of such a collective bargaining
agreement if entered into, it is undeniable that non-compliance therewith constitutes an unfair labor
practice." 18
4. Accordingly, the unfair labor practice strike called by the Union did have the impress of validity.
Rightly labor is justified in making use of such a weapon in its arsenal to counteract what is clearly
outlawed by the Industrial Peace Act. That would be one way to assure that the objectives of
unionization and collective bargaining would not be thwarted. It could, of course, file an unfair labor
practice case before the Court of Industrial Relations. It is not precluded, however, from relying on its
own resources to frustrate such an effort on the part of employer. So we have consistently held — and
for the soundest of reasons. 19

There is this categorial pronouncement from the present Chief Justice: "Again, the legality of the strike
follows as a corollary to the finding of fact, made in the decision appealed from — which is supported by
substantial evidence — to the effect that the strike had triggered by the Company's failure to abide by
the terms and conditions of its collective bargaining agreement with the Union, by the discrimination,
resorted to by the company, with regard to hire and tenure of employment, and the dismissal of
employees due to union activities, as well as the refusal of the company to bargain collectively in good
faith." 20 As a matter of fact, this Court has gone even further. It is not even required that there be in fact
an unfair labor practice committed by the employer. It suffices, if such a belief in good faith is
entertained by labor, as the inducing factor for staging a strike. So it was clearly stated by the present
Chief Justice while still an Associate Justice of this Court: "As a consequence, we hold that the strike in
question had been called to offset what petitioners were warranted in believing in good faith to be
unfair labor practices on the part of Management, that petitioners were not bound, therefore, to wait
for the expiration of thirty (30) days from notice of strike before staging the same, that said strike was
not, accordingly, illegal and that the strikers had not thereby lost their status as employees of
respondents herein." 21

5. It would thus appear that the decision now on appeal did not reflect sufficient awareness of
authoritative pronouncements coming from this Court. What is worse, certain portions thereof yield the
impression that an attitude decidedly unsympathetic to labors resort to strike is evident. Such should
not be the case. The right to self-organization so sedulously guarded by the Industrial Peace Act
explicitly includes the right "to engage in concerted activities for the purpose of collective bargaining
and to the mutual aid or protection." 22 From and after June 17, 1953 then, there cannot be the least
doubt that a strike as form of concerted activity has the stamp of legitimacy. As a matter of law, even
under the regime of compulsary arbitration under the Court of Industrial Relations Act, 23 a strike was by
no means a forbidden weapon. Such is the thought embodied in the opinion of Justice Laurel in Rex
Taxicab Company v. Court of Industrial Relations. 24 Thus: "In other words, the employee, tenant or
laborer is inhibited from striking or walking out of his employment only when so enjoined by the Court
of Industrial Relations and after a dispute has been submitted thereto and pending award or decision by
the court of such dispute. It follows that, as in the present case, the employees or laborers may strike
before being ordered not to do so and before an industrial dispute is submitted to the Court of Industrial
Relations, subject to the power of the latter, after hearing when public interest so requires or when the
dispute cannot, in its opinion, be promptly decided or settled, to order them to return, with the
consequence that if the strikers fail to return to work, when so ordered, the court may authorize the
employer to accept other employees or laborers." 25 Former Chief Justice Paras, in a case not too long
before enactment of the Industrial Peace Act, had occasion to repeat such a view. Thus: "As a matter of
fact, a strike may not be staged only when, during the pendency of an industrial dispute, the Court of
industrial Relations has issued the proper injunction against the laborers (section 19, Commonwealth
Act No. 103, as amended). Capital need not, however, be apprehensive about the recurrence of strikes
in view of the system of compulsory arbitration by the Court of Industrial Relations." 26

A strike then, in the apt phrase of Justice J.B.L. Reyes, is "an institutionalized factor of democratic
growth." 27 This is to foster industrial democracy. Implicit in such a concept is the recognization that
concerning the ends which labor considers worth while, its wishes are ordinarily entitled to respect.
Necessarily so, the choice as to when such an objective may be attained by striking likewise belongs to
it. There is the rejection of the concept that an outside authority, even if governmental, should make the
decisions for it as to ends which are desirable and how they may be achieved. The assumption is that
labor can be trusted to determine for itself when the right to strike may be availed of in order to attain a
successful fruition in their disputes with management. It is true that there is a requirement, in the Act
that before the employees may do so, they must file with the Conciliation Service of the Department of
Labor a notice of their intention to strike. 28 Such a requisite however, as has been repeatedly declared
by this Court, does not have to be complied with in case of unfair labor practice strike, which certainly is
entitled to greater judicial protection if the Industrial Peace Act is to be rendered meaningful. What has
been said thus far would demonstrate the unwarranted deviation of the decision now on appeal from
what is indicated by the law and authoritative decisions.

6. Respondent Court was likewise impelled to consider the strike illegal because of the violence that
attended it. What is clearly within the law is the concerted activity of cessation of work in order that a
union's economic demands may be granted or that an employer cease and desist from an unfair labor
practice. That the law recognizes as a right. There is though a disapproval of the utilization of force to
attain such an objective. For implicit in the very concept of a legal order is the maintenance of peaceful
ways. A strike otherwise valid, if violent in character may be placed beyond the pale. Care is to be taken,
however, especially where an unfair labor practice is involved, to avoid stamping it with illegality just
because it is tainted by such acts. To avoid rendering illusory the recognition of the right to strike,
responsibility in such a case should be individual and not collective. A different conclusion would be
called for, of course, if the existence of force while the strike lasts is pervasive and widespread,
consistently and deliberately resorted to as a matter of policy. It could be reasonably concluded then
that even if justified as to ends it becomes illegal because of the means employed.

Respondent Court must have unduly impressed by the evidence submitted by the Shell Company to the
effect that the strike was marred by acts of force, intimidation and violence on the evening of June 14
and twice in the mornings of June 15 and 16, 1967 in Manila. Attention was likewise called to the fact
that even on the following day, with police officials stationed at the strike-bound area, molotov bombs
did explode and the streets were obstructed with wooden planks containing protruding nails. Moreover,
in the branches of the Shell Company in Iloilo City as well as in Bacolod, on dates unspecified, physical
injuries appeared to have been inflicted on management personnel. Respondent Court in the appealed
decision did penalize with loss of employment the ten individuals responsible for such acts. Nor is it to
be lost sight of that before the certification on June 27, 1967, one month had elapsed during which the
Union was on strike. Except on those few days specified then, the Shell Company could not allege that
the strike was conducted in a manner other than peaceful. Under the circumstances, it would be going
too far to consider that it thereby became illegal. This is not by any means to condone the utilization of
force by labor to attain its objectives. It is only to show awareness that is labor conflicts, the tension that
fills the air as well as the feeling of frustration and bitterness could break out in sporadic acts of
violence. If there be in this case a weighing of interests in the balance, the ban the law imposes on unfair
labor practices by management that could provoke a strike and its requirement that it be conducted
peaceably, it would be, to repeat, unjustified, considering all the facts disclosed, to stamp the strike with
illegality. It is enough that individual liability be incurred by those guilty of such acts of violence that call
for loss of employee status.

Such an approach is reflected in our recent decisions. As was realistically observed by the present Chief
Justice, it is usually attended by "the excitement, the heat and the passion of the direct participants in
the labor dispute, at the peak thereof ...." 29 Barely four months ago, in Insular Life Assurance Co., Ltd.
Employees Association v. Insular life Assurance Co., Ltd., 30 there is the recognition by this Court,
speaking through Justice Castro, of picketing as such being "inherently explosive." 31 It is thus clear that
not every form of violence suffices to affix the seal of illegality on a strike or to cause the loss of
employment by the guilty party.

7. In the light of the foregoing, there being a valid unfair labor practice strike, the loss of employment
decreed by respondent Court on all the Union officers cannot stand. The premise on which such penalty
was decreed was the illegality of the strike. We rule differently. Hence, its imposition is unwarranted. It
is to be made clear, however, that because of the commission of specific serious acts of violence, the
Union's President, Gregorio Bacsa, as well as its Assistant Auditor, Conrado Peña, did incur such a
penalty. 32

On this point, it may be observed further that even if there was a mistake in good faith by the Union
that an unfair labor practice was committed by the Shell Company when such was not the case, still the
wholesale termination of employee status of all the officers of the Union, decreed by respondent Court,
hardly commends itself for approval. Such a drastic blow to a labor organization, leaving it leaderless,
has serious repercussions. The immediate effect is to weaken the Union. New leaders may of course
emerge. It would not be unlikely, under the circumstances, that they would be less than vigorous in the
prosecution of labor's claims. They may be prove to fall victims to counsels of timidity and
apprehension. At the forefront of their consciousness must be an awareness that a mistaken move could
well mean their discharge from employment. That would be to render the right to self-organization
illusory. The plain and unqualified constitutional command of protection to labor should not be lost sight
of. 33 The State is thus under obligation to lend its aid and its succor to the efforts of its labor elements to
improve their economic condition. It is now generally accepted that unionization is a means to such an
end. It should be encouraged. Thereby, labor's strength, what there is of it, becomes solidified. It can
bargain as a collectivity. Management then will not always have the upper hand nor be in a position to
ignore its just demands. That, at any rate, is the policy behind the Industrial Peace Act. The judiciary and
administrative agencies in consrtruing it must ever be conscious of its implications. Only thus may there
be fidelity to what is ordained by the fundamental law. For if it were otherwise, instead of protection,
there would be neglect or disregard. That is ito negate the fundamental principle that the Constitution is
the supreme law.

WHEREFORE, the decision of respondent Court of Industrial Relations of August 5, 1967 is reversed, the
finding of illegality of the strike declared by the Shell Oil Workers' Union on May 25, 1967 not being in
accordance with law. Accordingly, the dismissal by the Shell Company on May 27, 1967 of the eighteen
security guards, 34 with the exception of Ernesto Crisostomo, who was found guilty of committing a
serious act of violence is set aside and they are declared reinstated. The continuance of their status such
is, however, dependent on whether or not a security guard section is provided for in the collective
bargaining contract entered into after the expiration of the contract that expired on December 31, 1969.
The loss of employee status of the officers of the Union, 35 decreed by respondent Court in its decision, is
likewise set aside, except as to Gregorio Bacsa and Conrado Pena, both of whom did commit serious acts
of violence. The termination of the employment status of Nestor Samson, Jose Rey, Romeo Rosales,
Antonio Labrador and Sesinando Romero, who committed acts of violence not serious in character, is
also set aside, but while allowed to be reinstated, they are not entitled to back pay. Ricardo Pagsibigan
and Daniel Barraquel, along with the aforesaid Gregorio Baesa, Conrado Peña and Ernesto Crisostomo,
were legally penalized with dismissal because of the serious acts of violence committed by them in the
course of the strike. The rest of the employees laid off should be reinstated with back pay to be counted
from the date they were separated by virtue of the appealed decision, from which should be deducted
whatever earnings may have been received by such employees during such period. The case is hereby
remanded to respondent Court for the implementation of this decision. In ascertaining the back wages
to which the security guards are entitled, it must likewise be ascertained whether or not the security
guard section is continued after December 31, 1969. Without costs.

Concepcion, C.J., Zaldivar, Teehankee, Villamor and Makasiar, JJ., concur.

Castro, J., took no part.

Separate Opinions

BARREDO, J.,  concurring:

To be sure, a dissent from the opinion ably written by Our learned colleague, Justice Fernando, may not
be entirely without some degree of plausibility. To begin with, the basic conclusion of fact of the Court
of Industrial Relations in the appealed decision, which by law and the previously unbroken line of
decisions of this Court on the point, We cannot lightly set aside, seem to be logical and supported by
evidence not seriously disputed. Withal, when it is considered that there is nothing in the record to
show that in acting as it did in this case, respondent Shell Company, Ltd. was not, actuated by any anti-
union, much less anti-labor motive but by purely economic reasons of sound management, and, in fact,
petitioner does not even suggest any such purpose, one must have to hesitate and deliberate long and
hard before giving assent to a pronouncement that this respondent is guilty of unfair labor practice,
such as to legalize the strike declared by petitioner against it. I take it, however, that in a larger sense
this is a policy decision, and all things considered, particularly the constitutional injunctions on social
justice and protection to labor, I prefer to err, since the juridical considerations and equities in this case
appear to my mind and conscience to be in equipoise, on the side of labor, who, as I see it, acted in the
same good faith that management did. I must hasten to add though, that in thus referring to labor, I do
not have in mind the union leaders involved in this case to whom the Court of Industrial Relations has
attributed personal reasons for their attitude, but I am thinking more of those security guards who felt
uncertain about ultimate consequences of their transfer ordered by respondent and naturally found
nothing to hold on was the protection of the collective bargaining agreement which they had a right to
assume insured the substantial continuance of the terms and conditions of their employment
contemplated in said agreement at the time it was entered into.

Contrary to the conclusion of the distinguished writer of the main opinion, I regret to say that the record
amply supports the finding of the Industrial Court that the transfer of the eighteen security guards
concerned was not a violation of the collective bargaining agreement between petitioner and said
respondent. The more I go over the considerations of the appealed decision, the more I am convinced
not only that the move was never tinged by any anti- labor hue but also that respondent had from the
very beginning taken petitioner and its duly authorities representatives in its long study and deliberation
of the problem, which took years, and had, in fact, consulted them on various aspects thereof. It is not
denied that the maintenance of security is not the only aspect of its multifarious departments it has
decided to contract out; petitioner did not object to the previous ones. Indeed, it is safe, to conjecture
that petitioner has always seen the point of respondent, principally the economy it would achieve and
the consequent benefits labor might gain thereby. In this connection, I particularly note that there is
nothing in the record indicating that there is factual basis for petitioner's claim that the security guards
herein involved would surely suffer economic loss as a result of their questioned transfer; respondent
made it plain that overtime and other benefits accruing to them as security guards would likewise be
given to them in their new positions. And in answer to petitioner's almost rhetorical question, why were
said guards being given additional hourly pay and lump sum bonuses, if respondent did not feel, that
their rights were being violated, it is perhaps not unreasonable to suppose that management simply felt
that as the company was to save money by contracting out its security maintenance, it was but proper
that the affected sector of labor' should share a part of its savings.

All these, however, do not mean, on the other hand, that petitioner's strike should necessarily be held
to be illegal. It is always a wholesome attitude in cases of this nature to give but secondary importance
to strict technicalities, whether of substantive or remedial law, and to constantly bear in mind the
human values involved which are beyond pecuniary estimation. As a general rule, labor's most potent
and effective weapon is the strike, and it is but natural that when things appear to be dimming on the
negotiation tables, labor should almost instinctively take a striking posture. In other words, the
determination of the legality or illegality of a strike, particularly in this enlightened era of progressive
thinking on labor-management relations is something that cannot be achieved by mere straight-jacketed
legalistic argumentation and rationalization; the process is broader and deeper than that, for to do
justice in deciding such an issue, it is imperative that utmost consideration should be given to the
particular circumstances of each case, with a view to having the most comprehensive understanding of
the motivations of the parties, in the light of human needs on the part of labor, and in the perspective of
the orderly and economical conduct of business and industry, on the part of management. In this
particular case, for instance, I cannot agree that respondent has violated its collective bargaining
agreement with petitioner, but, on the other hand, I am not ready to conclude that for this reason, the
strike here in question was consequently illegal. I hold that the two strike votes taken by the members
of the petitioning union were both premised on the sincere and honest belief that there was a legal
breach of the said agreement. That now I find, as the Industrial Court did, that technically and in truth,
there was no such infringement did not of necessity stamp the said strike with the stigma of illegality.

It may not be amiss to add at this juncture, to allay and disabuse possible apprehension that the main
opinion may conceivably produce in some quarters, that I do not discern in it any prejudice on the part
of Justice Fernando, strictly pro-labor and anti-management. Precisely, I am giving my concurrence to
the judgment in this case because I am convinced that, fundamentally he has also viewed the situation
at hand in the light of the above considerations, even if our respective approaches and articulation of
views have to differ, since I do not own all the perspectives whence he gives support to his conclusions,
because I personally do not find any necessity to resort to other authorities, when I feel that plain
reasoning, predicated on commonly accepted principles and reliance on one's proper sense of justice
can suffice for the occasion.

I also concur in the sanctions ordered in the main opinion. The Court has individualized the respective
responsibilities of the strikers herein involved because such exactly is what the justice of the situation
demands. The reinstatement of those relatively innocent cannot be but only fair and equitable and the
approval of the lay-off of those found to have acted beyond the requirements of the circumstances is
founded on sound policy. In simple terms, I hold that the mere fact that a strike is not illegal, and I want
to emphasize here that there is, in my opinion, a large shade of difference between a strike that is really
justified and legal and one that is merely held not to be illegal, cannot be an excuse for resort to
violence. Even picketing which is the sister remedy of strikes is not supposed to be completely
unrestrained and unrestricted, and unprovoked violence, threats and duress of more or less grave
nature employed by strikers against person and property are twice removed from what can be judicially
tolerated.

Separate Opinions

BARREDO, J.,  concurring:

To be sure, a dissent from the opinion ably written by Our learned colleague, Justice Fernando, may not
be entirely without some degree of plausibility. To begin with, the basic conclusion of fact of the Court
of Industrial Relations in the appealed decision, which by law and the previously unbroken line of
decisions of this Court on the point, We cannot lightly set aside, seem to be logical and supported by
evidence not seriously disputed. Withal, when it is considered that there is nothing in the record to
show that in acting as it did in this case, respondent Shell Company, Ltd. was not, actuated by any anti-
union, much less anti-labor motive but by purely economic reasons of sound management, and, in fact,
petitioner does not even suggest any such purpose, one must have to hesitate and deliberate long and
hard before giving assent to a pronouncement that this respondent is guilty of unfair labor practice,
such as to legalize the strike declared by petitioner against it. I take it, however, that in a larger sense
this is a policy decision, and all things considered, particularly the constitutional injunctions on social
justice and protection to labor, I prefer to err, since the juridical considerations and equities in this case
appear to my mind and conscience to be in equipoise, on the side of labor, who, as I see it, acted in the
same good faith that management did. I must hasten to add though, that in thus referring to labor, I do
not have in mind the union leaders involved in this case to whom the Court of Industrial Relations has
attributed personal reasons for their attitude, but I am thinking more of those security guards who felt
uncertain about ultimate consequences of their transfer ordered by respondent and naturally found
nothing to hold on was the protection of the collective bargaining agreement which they had a right to
assume insured the substantial continuance of the terms and conditions of their employment
contemplated in said agreement at the time it was entered into.

Contrary to the conclusion of the distinguished writer of the main opinion, I regret to say that the record
amply supports the finding of the Industrial Court that the transfer of the eighteen security guards
concerned was not a violation of the collective bargaining agreement between petitioner and said
respondent. The more I go over the considerations of the appealed decision, the more I am convinced
not only that the move was never tinged by any anti- labor hue but also that respondent had from the
very beginning taken petitioner and its duly authorities representatives in its long study and deliberation
of the problem, which took years, and had, in fact, consulted them on various aspects thereof. It is not
denied that the maintenance of security is not the only aspect of its multifarious departments it has
decided to contract out; petitioner did not object to the previous ones. Indeed, it is safe, to conjecture
that petitioner has always seen the point of respondent, principally the economy it would achieve and
the consequent benefits labor might gain thereby. In this connection, I particularly note that there is
nothing in the record indicating that there is factual basis for petitioner's claim that the security guards
herein involved would surely suffer economic loss as a result of their questioned transfer; respondent
made it plain that overtime and other benefits accruing to them as security guards would likewise be
given to them in their new positions. And in answer to petitioner's almost rhetorical question, why were
said guards being given additional hourly pay and lump sum bonuses, if respondent did not feel, that
their rights were being violated, it is perhaps not unreasonable to suppose that management simply felt
that as the company was to save money by contracting out its security maintenance, it was but proper
that the affected sector of labor' should share a part of its savings.

All these, however, do not mean, on the other hand, that petitioner's strike should necessarily be held
to be illegal. It is always a wholesome attitude in cases of this nature to give but secondary importance
to strict technicalities, whether of substantive or remedial law, and to constantly bear in mind the
human values involved which are beyond pecuniary estimation. As a general rule, labor's most potent
and effective weapon is the strike, and it is but natural that when things appear to be dimming on the
negotiation tables, labor should almost instinctively take a striking posture. In other words, the
determination of the legality or illegality of a strike, particularly in this enlightened era of progressive
thinking on labor-management relations is something that cannot be achieved by mere straight-jacketed
legalistic argumentation and rationalization; the process is broader and deeper than that, for to do
justice in deciding such an issue, it is imperative that utmost consideration should be given to the
particular circumstances of each case, with a view to having the most comprehensive understanding of
the motivations of the parties, in the light of human needs on the part of labor, and in the perspective of
the orderly and economical conduct of business and industry, on the part of management. In this
particular case, for instance, I cannot agree that respondent has violated its collective bargaining
agreement with petitioner, but, on the other hand, I am not ready to conclude that for this reason, the
strike here in question was consequently illegal. I hold that the two strike votes taken by the members
of the petitioning union were both premised on the sincere and honest belief that there was a legal
breach of the said agreement. That now I find, as the Industrial Court did, that technically and in truth,
there was no such infringement did not of necessity stamp the said strike with the stigma of illegality.

It may not be amiss to add at this juncture, to allay and disabuse possible apprehension that the main
opinion may conceivably produce in some quarters, that I do not discern in it any prejudice on the part
of Justice Fernando, strictly pro-labor and anti-management. Precisely, I am giving my concurrence to
the judgment in this case because I am convinced that, fundamentally he has also viewed the situation
at hand in the light of the above considerations, even if our respective approaches and articulation of
views have to differ, since I do not own all the perspectives whence he gives support to his conclusions,
because I personally do not find any necessity to resort to other authorities, when I feel that plain
reasoning, predicated on commonly accepted principles and reliance on one's proper sense of justice
can suffice for the occasion.

I also concur in the sanctions ordered in the main opinion. The Court has individualized the respective
responsibilities of the strikers herein involved because such exactly is what the justice of the situation
demands. The reinstatement of those relatively innocent cannot be but only fair and equitable and the
approval of the lay-off of those found to have acted beyond the requirements of the circumstances is
founded on sound policy. In simple terms, I hold that the mere fact that a strike is not illegal, and I want
to emphasize here that there is, in my opinion, a large shade of difference between a strike that is really
justified and legal and one that is merely held not to be illegal, cannot be an excuse for resort to
violence. Even picketing which is the sister remedy of strikes is not supposed to be completely
unrestrained and unrestricted, and unprovoked violence, threats and duress of more or less grave
nature employed by strikers against person and property are twice removed from what can be judicially
tolerated.

G.R. No. 85279 July 28, 1989

SOCIAL SECURITY SYSTEM EMPLOYEES ASSOCIATION (SSSEA), DIONISION T. BAYLON, RAMON

MODESTO, JUANITO MADURA, REUBEN ZAMORA, VIRGILIO DE ALDAY, SERGIO ARANETA, PLACIDO
AGUSTIN, VIRGILIO MAGPAYO, petitioner,
vs.
THE COURT OF APPEALS, SOCIAL SECURITY SYSTEM (SSS), HON. CEZAR C. PERALEJO, RTC, BRANCH 98,
QUEZON CITY, respondents.

Vicente T. Ocampo & Associates for petitioners.

CORTES, J:

Primarily, the issue raised in this petition is whether or not the Regional Trial Court can enjoin the Social
Security System Employees Association (SSSEA) from striking and order the striking employees to return
to work. Collaterally, it is whether or not employees of the Social Security System (SSS) have the right to
strike.

The antecedents are as follows:

On June 11, 1987, the SSS filed with the Regional Trial Court of Quezon City a complaint for damages
with a prayer for a writ of preliminary injunction against petitioners, alleging that on June 9, 1987, the
officers and members of SSSEA staged an illegal strike and baricaded the entrances to the SSS Building,
preventing non-striking employees from reporting for work and SSS members from transacting business
with the SSS; that the strike was reported to the Public Sector Labor - Management Council, which
ordered the strikers to return to work; that the strikers refused to return to work; and that the SSS
suffered damages as a result of the strike. The complaint prayed that a writ of preliminary injunction be
issued to enjoin the strike and that the strikers be ordered to return to work; that the defendants
(petitioners herein) be ordered to pay damages; and that the strike be declared illegal.

It appears that the SSSEA went on strike after the SSS failed to act on the union's demands, which
included: implementation of the provisions of the old SSS-SSSEA collective bargaining agreement (CBA)
on check-off of union dues; payment of accrued overtime pay, night differential pay and holiday pay;
conversion of temporary or contractual employees with six (6) months or more of service into regular
and permanent employees and their entitlement to the same salaries, allowances and benefits given to
other regular employees of the SSS; and payment of the children's allowance of P30.00, and after the
SSS deducted certain amounts from the salaries of the employees and allegedly committed acts of
discrimination and unfair labor practices [Rollo, pp. 21-241].

The court a quo, on June 11, 1987, issued a temporary restraining order pending resolution of the
application for a writ of preliminary injunction [Rollo, p. 71.] In the meantime, petitioners filed a motion
to dismiss alleging the trial court's lack of jurisdiction over the subject matter [Rollo, pp. 72-82.] To this
motion, the SSS filed an opposition, reiterating its prayer for the issuance of a writ of injunction [Rollo,
pp. 209-222]. On July 22,1987, in a four-page order, the court a quo denied the motion to dismiss and
converted the restraining order into an injunction upon posting of a bond, after finding that the strike
was illegal [Rollo, pp. 83- 86]. As petitioners' motion for the reconsideration of the aforesaid order was
also denied on August 14, 1988 [Rollo, p. 94], petitioners filed a petition for certiorari and prohibition
with preliminary injunction before this Court. Their petition was docketed as G.R. No. 79577. In a
resolution dated October 21, 1987, the Court, through the Third Division, resolved to refer the case to
the Court of Appeals. Petitioners filed a motion for reconsideration thereof, but during its pendency the
Court of Appeals on March 9,1988 promulgated its decision on the referred case [Rollo, pp. 130-137].
Petitioners moved to recall the Court of Appeals' decision. In the meantime, the Court on June 29,1988
denied the motion for reconsideration in G.R. No. 97577 for being moot and academic. Petitioners'
motion to recall the decision of the Court of Appeals was also denied in view of this Court's denial of the
motion for reconsideration [Rollo, pp. 141- 143]. Hence, the instant petition to review the decision of
the Court of Appeals [Rollo, pp. 12-37].

Upon motion of the SSS on February 6,1989, the Court issued a temporary restraining order enjoining
the petitioners from staging another strike or from pursuing the notice of strike they filed with the
Department of Labor and Employment on January 25, 1989 and to maintain the status quo [Rollo, pp.
151-152].

The Court, taking the comment as answer, and noting the reply and supplemental reply filed by
petitioners, considered the issues joined and the case submitted for decision.

The position of the petitioners is that the Regional Trial Court had no jurisdiction to hear the case
initiated by the SSS and to issue the restraining order and the writ of preliminary injunction, as
jurisdiction lay with the Department of Labor and Employment or the National Labor Relations
Commission, since the case involves a labor dispute.

On the other hand, the SSS advances the contrary view, on the ground that the employees of the SSS are
covered by civil service laws and rules and regulations, not the Labor Code, therefore they do not have
the right to strike. Since neither the DOLE nor the NLRC has jurisdiction over the dispute, the Regional
Trial Court may enjoin the employees from striking.

In dismissing the petition for certiorari and prohibition with preliminary injunction filed by petitioners,
the Court of Appeals held that since the employees of the SSS, are government employees, they are not
allowed to strike, and may be enjoined by the Regional Trial Court, which had jurisdiction over the SSS'
complaint for damages, from continuing with their strike.

Thus, the sequential questions to be resolved by the Court in deciding whether or not the Court of
Appeals erred in finding that the Regional Trial Court did not act without or in excess of jurisdiction
when it took cognizance of the case and enjoined the strike are as follows:

1. Do the employees of the SSS have the right to strike?

2. Does the Regional Trial Court have jurisdiction to hear the case initiated by the SSS and to enjoin the
strikers from continuing with the strike and to order them to return to work?

These shall be discussed and resolved seriatim

The 1987 Constitution, in the Article on Social Justice and Human Rights, provides that the State "shall
guarantee the rights of all workers to self-organization, collective bargaining and negotiations, and
peaceful concerted activities, including the right to strike in accordance with law" [Art. XIII, Sec. 31].

By itself, this provision would seem to recognize the right of all workers and employees, including those
in the public sector, to strike. But the Constitution itself fails to expressly confirm this impression, for in
the Sub-Article on the Civil Service Commission, it provides, after defining the scope of the civil service
as "all branches, subdivisions, instrumentalities, and agencies of the Government, including
government-owned or controlled corporations with original charters," that "[t]he right to self-
organization shall not be denied to government employees" [Art. IX(B), Sec. 2(l) and (50)].
Parenthetically, the Bill of Rights also provides that "[tlhe right of the people, including those employed
in the public and private sectors, to form unions, associations, or societies for purposes not contrary to
law shall not abridged" [Art. III, Sec. 8]. Thus, while there is no question that the Constitution recognizes
the right of government employees to organize, it is silent as to whether such recognition also includes
the right to strike.

Resort to the intent of the framers of the organic law becomes helpful in understanding the meaning of
these provisions. A reading of the proceedings of the Constitutional Commission that drafted the 1987
Constitution would show that in recognizing the right of government employees to organize, the
commissioners intended to limit the right to the formation of unions or associations only, without
including the right to strike.

Thus, Commissioner Eulogio R. Lerum, one of the sponsors of the provision that "[tlhe right to self-
organization shall not be denied to government employees" [Art. IX(B), Sec. 2(5)], in answer to the
apprehensions expressed by Commissioner Ambrosio B. Padilla, Vice-President of the Commission,
explained:

MR. LERUM. I think what I will try to say will not take that long. When we proposed this amendment
providing for self-organization of government employees, it does not mean that because they have the
right to organize, they also have the right to strike. That is a different matter. We are only talking about
organizing, uniting as a union. With regard to the right to strike, everyone will remember that in the Bill
of Rights, there is a provision that the right to form associations or societies whose purpose is not
contrary to law shall not be abridged. Now then, if the purpose of the state is to prohibit the strikes
coming from employees exercising government functions, that could be done because the moment that
is prohibited, then the union which will go on strike will be an illegal union. And that provision is carried
in Republic Act 875. In Republic Act 875, workers, including those from the government-owned and
controlled, are allowed to organize but they are prohibited from striking. So, the fear of our honorable
Vice- President is unfounded. It does not mean that because we approve this resolution, it carries with it
the right to strike. That is a different matter. As a matter of fact, that subject is now being discussed in
the Committee on Social Justice because we are trying to find a solution to this problem. We know that
this problem exist; that the moment we allow anybody in the government to strike, then what will
happen if the members of the Armed Forces will go on strike? What will happen to those people trying
to protect us? So that is a matter of discussion in the Committee on Social Justice. But, I repeat, the right
to form an organization does not carry with it the right to strike. [Record of the Constitutional
Commission, vol. 1, p. 569].

It will be recalled that the Industrial Peace Act (R.A. No. 875), which was repealed by the Labor Code
(P.D. 442) in 1974, expressly banned strikes by employees in the Government, including
instrumentalities exercising governmental functions, but excluding entities entrusted with proprietary
functions:

.Sec. 11. Prohibition Against Strikes in the Government. —  The terms and conditions of employment in
the Government, including any political subdivision or instrumentality thereof, are governed by law and
it is declared to be the policy of this Act that employees therein shall not strike for the purpose of
securing changes or modification in their terms and conditions of employment. Such employees may
belong to any labor organization which does not impose the obligation to strike or to join in
strike: Provided, however, That this section shall apply only to employees employed in governmental
functions and not those employed in proprietary functions of the Government including but not limited
to governmental corporations.

No similar provision is found in the Labor Code, although at one time it recognized the right of
employees of government corporations established under the Corporation Code to organize and bargain
collectively and those in the civil service to "form organizations for purposes not contrary to law" [Art.
244, before its amendment by B.P. Blg. 70 in 1980], in the same breath it provided that "[t]he terms and
conditions of employment of all government employees, including employees of government owned
and controlled corporations, shall be governed by the Civil Service Law, rules and regulations" [now Art.
276]. Understandably, the Labor Code is silent as to whether or not government employees may strike,
for such are excluded from its coverage [Ibid]. But then the Civil Service Decree [P.D. No. 807], is equally
silent on the matter.

On June 1, 1987, to implement the constitutional guarantee of the right of government employees to
organize, the President issued E.O. No. 180 which provides guidelines for the exercise of the right to
organize of government employees. In Section 14 thereof, it is provided that "[t]he Civil Service law and
rules governing concerted activities and strikes in the government service shall be observed, subject to
any legislation that may be enacted by Congress." The President was apparently referring to
Memorandum Circular No. 6, s. 1987 of the Civil Service Commission under date April 21, 1987 which,
"prior to the enactment by Congress of applicable laws concerning strike by government employees ...
enjoins under pain of administrative sanctions, all government officers and employees from staging
strikes, demonstrations, mass leaves, walk-outs and other forms of mass action which will result in
temporary stoppage or disruption of public service." The air was thus cleared of the confusion. At
present, in the absence of any legislation allowing government employees to strike, recognizing their
right to do so, or regulating the exercise of the right, they are prohibited from striking, by express
provision of Memorandum Circular No. 6 and as implied in E.O. No. 180. [At this juncture, it must be
stated that the validity of Memorandum Circular No. 6 is not at issue].

But are employees of the SSS covered by the prohibition against strikes?

The Court is of the considered view that they are. Considering that under the 1987 Constitution "[t]he
civil service embraces all branches, subdivisions, instrumentalities, and agencies of the Government,
including government-owned or controlled corporations with original charters" [Art. IX(B), Sec. .2(l) see
also Sec. 1 of E.O. No. 180 where the employees in the civil service are denominated as "government
employees"] and that the SSS is one such government-controlled corporation with an original charter,
having been created under R.A. No. 1161, its employees are part of the civil service [NASECO v. NLRC,
G.R. Nos. 69870 & 70295, November 24,1988] and are covered by the Civil Service Commission's
memorandum prohibiting strikes. This being the case, the strike staged by the employees of the SSS was
illegal.

The statement of the Court in Alliance of Government Workers v. Minister of Labor and
Employment  [G.R. No. 60403, August 3, 1:983, 124 SCRA 11 is relevant as it furnishes the rationale for
distinguishing between workers in the private sector and government employees with regard to the
right to strike:
The general rule in the past and up to the present is that 'the terms and conditions of employment in
the Government, including any political subdivision or instrumentality thereof are governed by law"
(Section 11, the Industrial Peace Act, R.A. No. 875, as amended and Article 277, the Labor Code, P.D. No.
442, as amended). Since the terms and conditions of government employment are fixed by law,
government workers cannot use the same weapons employed by workers in the private sector to secure
concessions from their employers. The principle behind labor unionism in private industry is that
industrial peace cannot be secured through compulsion by law. Relations between private employers
and their employees rest on an essentially voluntary basis. Subject to the minimum requirements of
wage laws and other labor and welfare legislation, the terms and conditions of employment in the
unionized private sector are settled through the process of collective bargaining. In government
employment, however, it is the legislature and, where properly given delegated power, the
administrative heads of government which fix the terms and conditions of employment. And this is
effected through statutes or administrative circulars, rules, and regulations, not through collective
bargaining agreements. [At p. 13; Emphasis supplied].

Apropos is the observation of the Acting Commissioner of Civil Service, in his position paper submitted
to the 1971 Constitutional Convention, and quoted with approval by the Court in Alliance, to wit:

It is the stand, therefore, of this Commission that by reason of the nature of the public employer and the
peculiar character of the public service, it must necessarily regard the right to strike given to unions in
private industry as not applying to public employees and civil service employees. It has been stated that
the Government, in contrast to the private employer, protects the interest of all people in the public
service, and that accordingly, such conflicting interests as are present in private labor relations could not
exist in the relations between government and those whom they employ. [At pp. 16-17; also quoted in
National Housing Corporation v. Juco, G.R. No. 64313, January 17,1985,134 SCRA 172,178-179].

E.O. No. 180, which provides guidelines for the exercise of the right to organize of government
employees, while clinging to the same philosophy, has, however, relaxed the rule to allow negotiation
where the terms and conditions of employment involved are not among those fixed by law. Thus:

.SECTION 13. Terms and conditions of employment or improvements thereof, except those that are
fixed by law, may be the subject of negotiations between duly recognized employees' organizations and
appropriate government authorities.

The same executive order has also provided for the general mechanism for the settlement of labor
disputes in the public sector to wit:

.SECTION 16. The Civil Service and labor laws and procedures, whenever applicable, shall be followed in
the resolution of complaints, grievances and cases involving government employees. In case any dispute
remains unresolved after exhausting all the available remedies under existing laws and procedures, the
parties may jointly refer the dispute to the [Public Sector Labor- Management] Council for appropriate
action.

Government employees may, therefore, through their unions or associations, either petition the
Congress for the betterment of the terms and conditions of employment which are within the ambit of
legislation or negotiate with the appropriate government agencies for the improvement of those which
are not fixed by law. If there be any unresolved grievances, the dispute may be referred to the Public
Sector Labor - Management Council for appropriate action. But employees in the civil service may not
resort to strikes, walk-outs and other temporary work stoppages, like workers in the private sector, to
pressure the Govemment to accede to their demands. As now provided under Sec. 4, Rule III of the
Rules and Regulations to Govern the Exercise of the Right of Government- Employees to Self-
Organization, which took effect after the instant dispute arose, "[t]he terms and conditions of
employment in the government, including any political subdivision or instrumentality thereof and
government- owned and controlled corporations with original charters are governed by law and
employees therein shall not strike for the purpose of securing changes thereof."

II

The strike staged by the employees of the SSS belonging to petitioner union being prohibited by law, an
injunction may be issued to restrain it.

It is futile for the petitioners to assert that the subject labor dispute falls within the exclusive jurisdiction
of the NLRC and, hence, the Regional Trial Court had no jurisdiction to issue a writ of injunction
enjoining the continuance of the strike. The Labor Code itself provides that terms and conditions of
employment of government employees shall be governed by the Civil Service Law, rules and regulations
[Art. 276]. More importantly, E.O. No. 180 vests the Public Sector Labor - Management Council with
jurisdiction over unresolved labor disputes involving government employees [Sec. 16]. Clearly, the NLRC
has no jurisdiction over the dispute.

This being the case, the Regional Trial Court was not precluded, in the exercise of its general jurisdiction
under B.P. Blg. 129, as amended, from assuming jurisdiction over the SSS's complaint for damages and
issuing the injunctive writ prayed for therein. Unlike the NLRC, the Public Sector Labor - Management
Council has not been granted by law authority to issue writs of injunction in labor disputes within its
jurisdiction. Thus, since it is the Council, and not the NLRC, that has jurisdiction over the instant labor
dispute, resort to the general courts of law for the issuance of a writ of injunction to enjoin the strike is
appropriate.

Neither could the court a quo be accused of imprudence or overzealousness, for in fact it had proceeded
with caution. Thus, after issuing a writ of injunction enjoining the continuance of the strike to prevent
any further disruption of public service, the respondent judge, in the same order, admonished the
parties to refer the unresolved controversies emanating from their employer- employee relationship to
the Public Sector Labor - Management Council for appropriate action [Rollo, p. 86].

III

In their "Petition/Application for Preliminary and Mandatory Injunction," and reiterated in their reply
and supplemental reply, petitioners allege that the SSS unlawfully withheld bonuses and benefits due
the individual petitioners and they pray that the Court issue a writ of preliminary prohibitive and
mandatory injunction to restrain the SSS and its agents from withholding payment thereof and to
compel the SSS to pay them. In their supplemental reply, petitioners annexed an order of the Civil
Service Commission, dated May 5, 1989, which ruled that the officers of the SSSEA who are not
preventively suspended and who are reporting for work pending the resolution of the administrative
cases against them are entitled to their salaries, year-end bonuses and other fringe benefits and
affirmed the previous order of the Merit Systems Promotion Board.
The matter being extraneous to the issues elevated to this Court, it is Our view that petitioners' remedy
is not to petition this Court to issue an injunction, but to cause the execution of the aforesaid order, if it
has already become final.

WHEREFORE, no reversible error having been committed by the Court of Appeals, the instant petition
for review is hereby DENIED and the decision of the appellate court dated March 9, 1988 in CA-G.R. SP
No. 13192 is AFFIRMED. Petitioners' "Petition/Application for Preliminary and Mandatory Injunction"
dated December 13,1988 is DENIED.

SO ORDERED.

G.R. No. L-49677 May 4, 1989

TRADE UNIONS OF THE PHILIPPINES AND ALLIED SERVICES, petitioner,

vs.
NATIONAL HOUSING CORPORATION and ATTY. VIRGILIO SY, as Officer-in-Charge of the Bureau of
Labor Relations, respondents.

Bonifacio V. Tupaz for petitioner.

The Government Corporate Counsel for respondent NHC.

Raul E. Espinosa for intervenor PACIWU.

REGALADO, J.:

The employees of the public sector comprise the largest bloc of workers in our national work force.
Governmental bureaucracy is continually being reorganized to cope with the growing complexity of the
problems and needs of political and administrative governance. As the increase in the number of
government employees grows space, the need to enhance their welfare correspondingly becomes more
imperative. While it may be assumed that the Government is exerting efforts to advance the interests of
its employees, it is quite understandable that the employees themselves should actively seek
arrangements where by they can participate more meaningfully in management and employment
relationships. There is, thus, a proliferation of unions or employees' organizations, each seeking
concomitant representational recognition.

The antecedent facts which led to the filing of this special civil action for certiorari are clear and
undisputed. The juridical status and relevant circumstances of respondent corporation have been
established in a case of illegal dismissal filed against it, as previously decided by the Court and
hereinafter discussed. However, submitted this time for Our resolution is a controversy on the propriety
of and requirements for certification elections in government-owned or controlled corporations like the
respondent.

Respondent National Housing Corporation (hereinafter referred to as NHC) is a corporation organized in

1959 in accordance with Executive Order No. 399, otherwise known as the Uniform Charter of
Government Corporations, dated January 1, 1951. Its shares of stock are and have been one hundred
percent (100%) owned by the Government from its incorporation under Act 459, the former corporation
law. The government entities that own its shares of stock are the Government Service Insurance System,
the Social Security System, the Development Bank of the Philippines, the National Investment and
Development Corporation and the People's Homesite and Housing Corporation. 1 Petitioner Trade
Unions of the Philippines and Allied Services (TUPAS, for brevity) is a legitimate labor organization with a
chapter in NHC.

On July 13, 1977, TUPAS filed a petition for the conduct of a certification election with Regional Office
No. IV of the Department of Labor in order to determine the exclusive bargaining representative of the
workers in NHC. It was claimed that its members comprised the majority of the employees of the
corporation. 2 The petition was dismissed by med-arbiter Eusebio M. Jimenez in an order, dated
November 7, 1977, holding that NHC "being a government-owned and/or controlled corporation its
employees/workers are prohibited to form, join or assist any labor organization for purposes of
collective bargaining pursuant to Section 1, Rule II, Book V of the Rules and Regulations Implementing
the Labor Code." 3

From this order of dismissal, TUPAS appealed to the Bureau of Labor Relations 4 where, acting thereon in
BLR Case No. A-984-77 (RO4-MED-1090-77), Director Carmelo C. Noriel reversed the order of dismissal
and ordered the holding of a certification election. 5 This order was, however, set aside by Officer-in-
Charge Virgilio S.J. Sy in his resolution of November 21, 1978 6 upon a motion for reconsideration of
respondent NHC.

In the instant petition for certiorari, TUPAS seeks the reversal of the said resolution and prays that a
certification election be held among the rank and file employees of NHC.

In retrospect, it will be recalled that in a former case of illegal dismissal involving the same respondent
corporation, 7 We had ruled that the employees of NHC and of other government owned or controlled
corporations were governed by civil service laws, rules and regulations pursuant to the 1973
Constitution which provided that "the civil service embraces every branch, agency, subdivision and
instrumentality of the government, including government-owned or controlled corporations." 8

It was therein stressed that to allow subsidiary corporations to be excluded from the civil service laws
would be to permit the circumvention or emasculation of the above-quoted constitutional provision. As
perceptively analyzed therein, "(i)t would be possible for a regular ministry of government to create a
host of subsidiary corporations under the Corporation Code funded by a willing legislature. A
government-owned corporation could create several subsidiary corporations. These subsidiary
corporation rations would enjoy the best of two worlds. Their officials and employees would be
privileged individuals, free from the strict accountability required by the Civil Service Decree and the
regulations of the Commission on Audit. Their incomes would not be subject to the competitive
restraints of the open market nor to the terms and conditions of civil service employment."

The rule, however, was modified in the 1987 Constitution, the corresponding provision whereof declares
that "(t)he civil service embraces all branches, subdivisions, instrumentalities and agencies of the
government, including government-owned or controlled corporations with original charters." 9

Consequently, the civil service now covers only government owned or controlled corporations with
original or legislative charters, that is those created by an act of Congress or by special law, and not
those incorporated under and pursuant to a general legislation. As We recently held —

..., the situations sought to be avoided by the 1973 Constitution and expressed by this Court in
the National Housing Corporation case ... appear relegated to relative insignificance by the 1987
Constitutional provision that the Civil Service embraces government-owned controlled
corporations with original charters  and therefore, by clear implication, the Civil Service does not include
government-owned or controlled corporations which are organized as subsidiaries of government-
owned or controlled corporations under the general corporation law. 10

While the aforecited cases sought different reliefs, that is, reinstatement consequent to illegal dismissal,
the same lis mota determinative of the present special civil action was involved therein.

The workers or employees of NHC undoubtedly have the right to form unions or employees'
organizations. The right to unionize or to form organizations is now explicitly recognized and granted to
employees in both the governmental and the private sectors. The Bill of Rights provides that "(t)he right
of the people, including those employed in the public and private sectors, to form unions, associations
or societies for purposes not contrary to law shall not be abridged" 11

This guarantee is reiterated in the second paragraph of Section 3, Article XIII, on Social Justice and
Human Rights, which mandates that the State "shall guarantee the rights of all workers to self-
organization, collective bargaining and negotiations, and peaceful concerted activities, including the
right to strike in accordance with law ...."

Specifically with respect to government employees, the right to unionize is recognized in Paragraph (5),
Section 2, Article IX B 12 which provides that "(t)he right to self-organization shall not be denied to
government employees." The rationale of and justification for this innovation which found expression in
the aforesaid provision was explained by its proponents as follows:

... The government is in a sense the repository of the national sovereignty and, in that respect, it must
be held in reverence if not in awe. It symbolizes the unity of the nation, but it does perform a mundane
task as well. It is an employer in every sense of the word except that terms and conditions of work are
set forth through a Civil Service Commission. The government is the biggest employer in the Philippines.
There is an employer-employee relationship and we all know that the accumulated grievances of several
decades are now beginning to explode in our faces among government workers who feel that the rights
afforded by the Labor Code, for example, to workers in the private sector have been effectively denied
to workers in government in what looks like a grotesque, (sic) a caricature of the equal protection of the
laws. For example, ... there were many occasions under the old government when wages and cost of
living allowances were granted to workers in the private sector but denied to workers in the
government for some reason or another, and the government did not even state the reasons why. The
government employees were being discriminated against. As a general rule, the majority of the world's
countries now entertain public service unions. What they really add up to is that the employees of the
government form their own association. Generally, they do not bargain for wages because these are
fixed in the budget but they do acquire a forum where, among other things, professional and self-
development is (sic) promoted and encouraged. They also act as watchdogs of their own bosses so that
when graft and corruption is committed, generally, it is the unions who are no longer afraid by virtue of
the armor of self-organization that become the public's own allies for detecting graft and corruption and
for exposing it.... 13

There is, therefore, no impediment to the holding of a certification election among the workers of NHC
for it is clear that they are covered by the Labor Code, the NHC being a government-owned and/or
controlled corporation without an original charter. Statutory implementation of the last cited section of
the Constitution is found in Article 244 of the Labor Code, as amended by Executive Order No. 111, thus:

... Right of employees in the public service —  Employees of the government corporations established
under the Corporation Code shall have the right to organize and to bargain collectively with their
respective employers. All other employees in the civil service shall have the right to form associations for
purposes not contrary to law.

The records do not show that supervening factual events have mooted the present action. It is meet,
however, to also call attention to the fact that, insofar as certification elections are concerned,
subsequent statutory developments have rendered academic even the distinction between the two
types of government-owned or controlled corporations and the laws governing employment relations
therein, as hereinbefore discussed. For, whether the employees of NHC are covered by the Labor Code
or by the civil service laws, a certification election may be conducted.

For employees in corporations and entities covered by the Labor Code, the determination of the
exclusive bargaining representative is particularly governed by Articles 255 to 259 of said Code. Article
256 provides for the procedure when there is a representation issue in organized establishments, while
Article 257 covers unorganized establishments. These Labor Code provisions are fleshed out by Rules V
to VII, Book V of the Omnibus Implementing Rules.

With respect to other civil servants, that is, employees of all branches, subdivisions, instrumentalities
and agencies of the government including government-owned or controlled corporations with original
charters and who are, therefore, covered by the civil service laws, the guidelines for the exercise of their
right to organize is provided for under Executive Order No. 180. Chapter IV thereof, consisting of
Sections 9 to 12, regulates the determination of the "sole and exclusive employees representative";
Under Section 12, "where there are two or more duly registered employees' organizations in the
appropriate organization unit, the Bureau of Labor Relations shall, upon petition order the conduct of
certification election and shall certify the winner as the exclusive representative of the rank-and-file
employees in said organizational unit."

Parenthetically, note should be taken of the specific qualification in the Constitution that the State "shall
guarantee the rights of all workers to self-organization, collective bargaining, and peaceful concerted
activities, including the right to strike in accordance with law" and that they shall also participate in
policy and decision-making processes affecting their rights and benefits as may be provided by
law." 14 (Emphasis supplied.)

ON THE FOREGOING CONSIDERATIONS, the assailed resolution of the Bureau of Labor Relations, dated
November 21, 1978, is ANNULLED and SET ASIDE and the conduct of a certification election among the
affected employees of respondent National Housing Corporation in accordance with the rules therefor is
hereby GRANTED.

SO ORDERED.

G.R. No. 95445               August 6, 1991

MANILA PUBLIC SCHOOL TEACHERS ASSOCIATION, FIDEL FABABIER MERLIN ANONUEVO, MINDA
GALANG and other teacher-members so numerous similarly situated, petitioners-appellants,
vs.
THE HON. PERFECTO LAGUIO JR., in his capacity as Presiding Judge of the Regional Trial Court of
Manila, Branch 18, HON. ISIDRO CARIÑO, in his capacity as Secretary of Education, Culture and Sports
and the HON. ERLINDA LOLARGA in her capacity as Manila City Schools Superintendent, respondents-
appellees.
G.R No. 95590               August 6, 1991

ALLIANCE OF CONCERNED TEACHERS (ACT), ENRIQUE D. TORRES, RODRIGO G. NATIVIDAD, FRANCISCO

A. NERECINA, EVA V. FERIA, LUCIA R. CARRASCO, LEO R. RAMBOYONG, ZENEIDA PEREZ, MARIA ACEJO
AND OTHER SIMILARLY SITUATED PUBLIC SCHOOL TEACHERS TOO NUMEROUS TO BE
IMPLEADED, petitioners,
vs.
HON. ISIDRO CARIÑO in his capacity as Secretary of Education, Culture and Sports and HON.
GUILLERMO CARAGUE, in his capacity as Secretary of Budget and Management, respondents.

Free Legal Assistance Group, Movement of Attorneys for Brotherhood Integrity & Nationalism and Union
of Lawyers and Advocates for petitioners in G.R. No. 95590.
Gregorio Fabros for petitioners in G.R. No. 95445.

NARVASA, J.:

The series of events that touched off these cases started with the so-called "mass action" undertaken by
some 800 public school teachers, among them members of the petitioning associations in both cases, on
September 17, 1990 to "dramatize and highlight"1 the teachers' plight resulting from the alleged failure
of the public authorities to act upon grievances that had time and again been brought to the latter's
attention.

The petition in G.R. No. 95590 alleges in great detail the character and origins of those grievances as
perceived by the petitioners, and the attempts to negotiate their correction;2 these are more briefly, but
quite adequately and with no sacrifice of relevant content, set forth in the petition in G.R. No. 954451,
portions of which are quoted hereunder without necessarily affirming their objective truth or
correctness:

3. Together with other teachers embracing the Teachers and Employees Consultative Council (TECC) and
the Alliance of Concerned Teachers, the petitioners, in accordance with their Constitution and By-Laws,
resolved to engage in mass concerted actions, after peaceful dialogues with the heads of the
Department of the Budget and Management, Senate and House of Representatives in public hearings as
well as after exhausting all administrative remedies, to press for, among other things, the immediate
payment of due chalk, clothing allowances, 13th month pay for 1989 arising from the implementation of
the Salary Standardization Law, the recall of DECS Order 39 s. 1990 directing the oversizing of classes
and overloading of teachers pursuant to the cost-cutting measures of the government, the hiring of
47,000 new teachers to ease the overload of existing teachers, the return of the additional 1% real
property taxes collected by local government units to education purposes to be administered by the
Local School Boards, and consequent recall of DBM Circulars Nos. 904 and 9011 and local budget circular
No. 47 consistent with RA 5447 and the new Constitution mandating that education shall enjoy the
highest budgetary priority in the national budget, and other equally important demands; The dialogues
and conferences initiated by the petitioners and other teacher organizations were as early as March 14,
1989, March 14, 1990, April 23, 1990, May 28, 1990, June 5, 1990, September 3, 1990 and September
14, 1990 with the Civil Service Commission, the Senate and House of Representatives, Department of
Budget and Management and the Department of Education, Culture and Sports, but all these did not
result in the granting of the demands of the petitioners, leaving them with no other recourse but to take
direct mass action such as the one they engaged in three weeks ago.

4. On September 14, 1990, the petitioners and other teachers in other cities and municipalities in Metro
Manila, staged a protest rally at the DECS premises without disrupting classes as a last call for the
government to negotiate the granting of demands. No response was made by the respondent Secretary
of Education, despite the demonstration, so the petitioners began the ongoing protest mass actions on
September, 17,1990. ...3

September 17, 1990 fell on a Monday, which was also a regular school day. There is no question that the
some 800 teachers who joined the mass action did not conduct their classes on that day; instead, as
alleged in the petition in G.R. No. 95590,4 they converged at the Liwasang Bonifacio in the morning
whence they proceeded to the National Office of the Department of Education, Culture and Sport (DECS)
for a whole-day assembly. At about 1:00 o'clock p.m., three representatives of the group were allowed
to see the respondent Secretary of Education who "brushed aside their grievances," warned them that
they would lose their jobs for going on illegal and unauthorized mass leave. Upon leaving said
respondent's presence, they were handed an order directing all participants in the mass action to return
to work in 24 hours or face dismissal, and a memorandum directing the DECS officials concerned to
initiate dismissal proceedings against those who did not comply and to hire their replacements.5 Those
directives notwithstanding, the mass actions continued into the week, with more teachers joining in the
days that followed. In its issue of September 19, 1990, the newspaper Manila Standard reported that
the day previous, the respondent Secretary of Education had relieved 292 teachers who did not return
to their classes. The next day, however, another daily, Newsday, reported that the Secretary had
revoked its dismissal order and instead placed 56 of the 292 teachers under preventive suspension,
despite which the protesters' numbers had swelled to 4,000.6

On the record, what did happen was that, based on reports submitted by the principals of the various
public schools in Metro Manila, the respondent Secretary of Education had filed motu
proprio administrative complaints against the teachers who had taken part in the mass actions and
defied the return-to-work order on assorted charges like grave misconduct, gross neglect of duty, gross
violation of the Civil Service Law, absence without official leave, etc., and placed them under 90-day
preventive suspension. The respondents were served copies of the charge sheets and given five (5) days
to submit answer or explanation. Later, on October 8, 1990, the respondent Secretary constituted an
investigating committee of four (4) to determine and take the appropriate course of action on the
formal charges and designated the special prosecutors on detail with the DECS to handle their
prosecution during the formal hearings.7

On October 11, 1990, the respondent Secretary of Education rendered the first of his now questioned
decisions on the administrative complaints. In Case No. DECS 90-002, he found twenty (20) respondent
teachers guilty of the charges preferred against them and dismissed them from office, effective
immediately.8 In the other investigations that followed and as of December 3, 1990, 658 teachers were
dismissed, 40 were suspended for one (1) year, 33 for nine (9) months, and 122 for six (6) months; 398
were exonerated.9

Earlier, on September 19, 1990, the petitioners in G.R. No. 95445 had filed with the Regional Trial Court
of Manila Branch 18, a petition10 for prohibition, declaratory relief and preliminary mandatory injunction
to restrain the implementation of the return-to-work order of September 17, 1990 and the suspension
or dismissal of any teacher pursuant thereto and to declare said order null and void. Issuance ex-parte of
a temporary restraining order was sought, but seeing no compelling reason therefor, the Regional Trial
Court instead set the application for preliminary injunction for hearing, and heard the same, on
September 24, 1990. Thereafter and following the submission of memorandums by the parties, said
Court rendered judgment declaring the assailed return-to-work order valid and binding, and dismissing
the petition for lack of merit.11

Review of said judgment is sought in G. R. No. 95445.

G.R. No. 95590 is a parallel original proceeding for prohibition, mandamus and certiorari grounded on
the same state of facts and instituted for substantially the same purpose i.e., the invalidation of the
return-to-work order of the respondent Secretary of Education and all orders of suspension and/or
dismissal thereafter issued by said respondent against the teachers who had taken part in the mass
actions of September 17, 1990 and the days that followed.

Both cases were ordered consolidated by Resolution issued on October 25, 1990,12 and separate
comments were filed by the Solicitor General on behalf of the public respondents, in G.R. No. 95445 on
October 31, 1990, and in G.R. No. 95590 on December 5, 1990.13 On November 20, 1990 the parties
were heard in oral argument on the petitioners' united pleas for a temporary restraining
order/mandatory injunction to restore the status quo ante and enjoin the public respondents from
continuing with the issuance of suspension orders and proceeding with the administrative cases against
the teachers involved in the mass actions.

Said pleas were denied by the Court in its Resolution of December 18, 1990,14 and a motion for
reconsideration filed by the petitioners in G.R. No. 95590 was likewise denied.

In two separate but identically-worded motions filed on their behalf by Atty. Froilan M. Bacungan,15 the
following persons, to wit: Florita D. Guazon, Elisea G. Lazo, Gonzala G. Sioson, Esperanza Valero, Nenita
Pangilinan, Ramon David, Aurora Bosi, Encarnita David, Socorro Sentin, Crispulo Santos, Rodriguez
Bagana, Rodolfo D. Bacsal, Ruben Bersamina, Rodolfo Arroyo, Irene Gadil, Rebecca Roldan, Rosita
Samson, Priscilla Avendia, Arturo Cabuhat, Rosalinda Caoili, Angelina Corpuz, Purisima Lena, Elsie
Somera, Dedaica Jusay, Teresita Partoza, Gloria Salvador, Catherine San Agustin, Nestor Aguirre, Lorenzo
Real, Celia Ronquillo, Vicente Carranza, Jessie Villanueva, Yolanda Alura, Clara Alvarez, Danilo Llamas,
Ladera Panita Myrna, Sena, Zenaida Ligon, Daisy S. Conti, Danilo Caballes, Susan Maragat, Roberto
Manlangit and Elizabeth T. Aguirre, seek leave to withdraw as parties in G.R. No. 95590. These movants
claim that they are such parties although not individually so named in the petition in said case, being
among those referred to in its title as "other similarly situated public school teachers too numerous to
be impleaded," who had been administratively charged, then preventively suspended and/or dismissed
in the wake of the mass actions of September 1990. They assert that since this Court is not a trier of
facts, they have opted to appeal the questioned decisions or actuations of the respondent Secretary of
Education to the Civil Service Commission where they believe they will have "... all the opportunity to
introduce evidence on how (Secretary) Cariño violated their constitutional rights to due process of law ...
security of tenure and ... peaceably to assemble and petition the government for redress of
grievances ...."
An opposition to the first motion was filed16 which, briefly, contended that, as this Court had already
found that the petitioners had gone on an unlawful strike and that public respondent Cariño's acts
were prima facie lawful, the motion was either an attempt at forum-shopping or meant to avoid the
"inevitable outcome" of issues already pending final determination by the Court.

The Court's Resolution of December 18, 1990, supra, denying the petitioners' plea for restoration of
the status quo ante and to restrain/enjoin further suspensions of, and the initiation or continuation of,
administrative proceedings against the teachers involved, is based on the following postulates:

(1) the undenied indeed, the pleaded and admitted fact that about 800 teachers, among them the
individual petitioners and other unnamed but "similarly situated" members of the petitioning
associations in both cases, unauthorizedly absented themselves from their classes on a regular
schoolday, September 17, 1990, in order to participate in a "mass action" to dramatize their grievances
concerning, in the main, the alleged failure of the public authorities, either to implement at all or to
implement in a just and correct manner, certain laws and measures intended to benefit them materially;

(2) the fact, too, that in the days that followed, more mass actions for the same purpose were
undertaken, notwithstanding a return-to-work order issued by the respondent Secretary of Education;
more teachers joined the so-called "peaceful assemblies" on September 18, 1990 and the number rising
to 4,000 on September 19, 1990;17

(3) that from the pleaded and admitted facts, these "mass actions" were to all intents and purposes a
strike; they constituted a concerted and unauthorized stoppage of, or absence from, work which it was
the teachers' duty to perform, undertaken for essentially economic reasons;

(4) that this court had already definitively ruled that employees in the public (civil) service, unlike those
in the private sector, do not have the right to strike, although guaranteed the right to self-organization,
to petition Congress for the betterment of employment terms and conditions and to negotiate with
appropriate government agencies for the improvement of such working conditions as are not fixed by
law;18

(5) that upon the foregoing premises, it was prima facie lawful and within his statutory authority for the
respondent Secretary of Education to take the actions complained of, to wit: issue a return-to-work
order, prefer administrative charges against, and place under preventive suspension, those who failed to
comply with said order, and dismiss from the service those who failed to answer or controvert the
charges;19

The Court has not since been presented with any consideration of law or established fact that would
impair the validity of these postulates or preclude continued reliance thereon for the purpose of
resolving the present petitions on their merits.

The underlying issue here is due process; not whether the petitioners have a right to strike, which it is
clear they do not, however justifiable their reasons, nor whether or not there was in fact such a strike, it
being equally evident from the pleadings that there was, and there being no dispute about this. What
therefore, is brought before the Court is the question of whether or not any rights of the petitioners
under the due process clause of the Constitution as it applies to administrative proceedings were
violated in the initiation, conduct, or disposition of the investigations complained of.
Indeed, what the petitioners in G.R. No. 95590 proclaim about denial of due process being their
"paramount complaint" ... "central to their prayer for interlocutory relief'20 could as well be said of the
merits of their main cause as of their plea for a restraining order pendente lite or a preliminary
injunction.

There are, however, insuperable obstacles to the Court's taking up that issue and resolving it in these
cases. Said issue is not ripe for adjudication by this Court in the exercise of its review jurisdiction; and
this, for the obvious reason that it is one of fact. The petitions and subsequent pleadings of the
petitioners allege facts and circumstances which, it is claimed, show denial of due process, citing as
supposedly "representative samples"21 among others: (a) that teachers were dismissed on the sole basis
of unsworn reports of their principals and without evidence of their alleged failure to obey the return-
to-work order; (b) that the charge sheets failed to specify the particular charges or offenses allegedly
committed; (c) that some teachers were not furnished sworn complaints, and others were suspended
without any formal charges; (d) that teachers who attempted to return within a reasonable time after
notice of the return-to-work order were not accepted back; and similar allegations.

These are however denied and disputed by the public respondents, who set forth their own version,
initially in their separate Comments in both cases and, later and in greater detail, in their Consolidated
Memorandum of December 3, 1990, supra, from which the following passages are quoted:

(6) Petitioners in G.R. No. 95545 and G.R. No. 95590  admit engaging in a strike (referred by semantic
interplay as "concerted activity" or "mass action") directed against public respondent Cariño beginning
September 17, 1990, MPSTA Petition, pp. 3, 9; ACT Petition, pp. 1516).

To avoid the disruption of classes, public respondent Cariño, also on September 17, 1990, issued a
'return to work order' reminding striking workers that  in law, they cannot engage in strike and warning
them that dismissal proceedings will be instituted against them if they do not return to work with 24
hours from their walkout (MPSTA Petition, p. 4; ACT Petition, p. 15) and a memorandum to DECS officials
instructing them to notify the striking teachers to return to work within 24 hours from their walkout and
to initiate dismissal proceedings against those who defy the return to work order as well as to hire
temporary replacements, MPSTA Petition, p. 4; ACT Petition, pp. 15-16).

The striking teachers who did not heed the return-to-work order were administratively charged and
preventively suspended for ninety days for grave misconduct, gross neglect of duty, insubordination,
refusal to perform official duty, absence without leave beginning September 17, 1990 and other
violations of Civil Service Law, rules and regulations. All of striking teachers were served with the
suspension orders and the change sheets notifying them of the charges and giving them five (5) days
from receipt of the charge sheets within which to file their respective answers.

With the filing of the administrative complaints and the receipt of the answers of some of the teachers
involved, public respondent Carino on October 8, 1990 issued a Memorandum forming an Investigation
Committee composed of Atty, Reno Capinpin of DECS Administrative Services as Chairman Dr. Alberto
Mendoza, representing the Division Supervisors, Atty. Evangeline de Castro, representing the City
Superintendent of Schools of Manila, and Atty. Isaias Meleto representing the National PPSTA
Organization, as members. Copy of the aforesaid Memorandum is hereto attached as Annex "I."
The committee was authorized to meet everyday, even as Special Prosecutors from the Department of
justice on detail with the DECS were designated to handle the prosecution during the formal hearings.
(Ibid.)

Petitioners in GR No. 95545' and 'G.R. No. 95590' admit having received the charge sheets and notices of
preventive suspension wherein they were given five days from receipt of the charges within which to file
their answers (MPSTA Petition, p. 4-1 ACT Petition, p. 16, Annexes x , to , AA ).

x x x           x x x          x x x

...  Many striking teachers received their preventive suspension orders and the charge sheets from their
respective principals when they visited their schools. Many refused to receive and sign receipt therefor;
others tore up the preventive suspension orders and charge sheets in front of their principals. Instead,
they took the occasion to belittle and insult the substitute teachers who took over their classrooms
temporarily.

The striking teachers were given a period of five days to file their Answers in line with Sec. 8, Rule III of
Rules on Administrative Disciplinary Cases in CSC Memorandum Circular No. 46, s. 1989. The motion for
extension of time to file Answer was denied by DECS Task Force because it was dilatory the alleged
reason being that Atty. Fabros is handling 2,000 cases of teachers. The DECS was constrained by Sec.
38(d) of P.D. 807 and Sec. 8 of the Memorandum Circular mentioned which mandate that administrative
cases must be decided within 30 days from the filing of the charges. Another reason was that  many
refused to receive the notice of charges. Also, to delay the resolution of the cases was to their
disadvantage.

Moreover, another reason proferred was that the Regional Trial Court (RTC) of Manila still had to act on
the petition before it. However, the Motion was filed AFTER the RTC Manila had already dismissed the
Petition.

Nevertheless, answers to the administrative complaints started pouring in at the DECS, as prepared
personally by the striking teachers or by their lawyers.

After initial assessments of the reports coming in from the principals of the schools concerned and the
answers of the striking teachers, the DECS Special Task Force prepared on October 9, 1990 and
submitted to respondent Secretary Carino the Guidelines and Criteria as to the nature of the evidence to
be assessed and the corresponding penalty to be imposed against the striking teachers, which was
approved by respondent Secretary Carino on the same day. A copy of the aforesaid Guidelines and
Criteria is hereto attached as Annex "2." Thereafter, the DECS Special Task Force proceeded with its task
of investigating the cases against the striking teachers.

Those who refused to sign the DECS return-to-work order, the preventive suspension orders and the
charge sheets, some even tearing up the documents presented to them by their principals were
considered by the DECS Special Task Force as having waived their right to be heard; their cases had to be
resolved on the basis of the records. Nevertheless, the DECS Special Task Force summoned the
principals concerned, who then testified under oath confirming their reports on the absences of the
striking teachers. Some clarificatory questions were asked of them on the manner of the service of the
DECS orders and the situation obtaining in their schools.
For those who answered the charge sheets, the DECS Special Task Force set the administrative cases for
hearing. Many of the striking teachers refused to appear at the hearings but preferred to submit their
case on the basis of their answers.

With regard to those who attended the hearings, each of the absent or striking teachers was
investigated and asked questions under oath on their answers and the reasons for their absences and/or
joining the teachers' strike. Some teachers reiterated their answers to the charge sheets, either giving
justifiable reasons for their absences on the days mentioned or maintaining their stubborn stand that
they have all the right to absent themselves from classes in the exercise of their constitutional right to
join mass action to demand from the government what are supposedly due them. Still the DECS Special
Task Force was not satisfied with their written answers and explanation during the hearings. The
principals of the striking teachers were summoned and they confirmed under oath their reports of
absences and/or on teachers joining the strike.

After having conducted fully their investigations, the DECS Special Task Force submitted in series their
investigation reports and recommendation for each category of striking teachers to respondent
Secretary Carino. The investigation reports, together with their supporting documents, submitted by the
DECS Special Task Force indicated clearly the manner and conduct of the administrative hearings, the
nature and weight of the evidence adduced, and the correspondingly penalty or exoneration
recommended.

On the bases of the investigation reports and recommendations of the DECS Special Task Force, and
after evaluating the reports and its documents attached, respondent Secretary Carino promulgated the
decisions either for exoneration, suspension or dismissal. Copies of the DECS decisions of exoneration,
suspension or dismissal were forwarded to the principals of the striking teachers concerned. Those
exonerated were allowed to resume their duties and received their back salaries. Some of the teachers
either suspended or dismissed have already received the copies of the decisions, either personally or
through mail.

x x x           x x x          x x x22

This copious citation is made, not to suggest that the Court finds what is stated therein to be true and
the contrary averments of the petitions to be false, but precisely to stress that the facts upon which the
question of alleged denial of due process would turn are still in issue, actively controverted, hence not
yet established.

It is not for the Court, which is not a trier of facts, as the petitioners who would now withdraw correctly
put it, to make the crucial determination of what in truth transpired concerning the disputed incidents.
Even if that were within its competence, it would be at best a monumental task. At any rate, the
petitioners cannot-as it seems they have done lump together into what amounts to a class action
hundreds of individual cases, each with its own peculiar set of facts, and expect a ruling that would justly
and correctly resolve each and everyone of those cases upon little more than general allegations,
frontally disputed as already pointed out, of incidents supposedly "representative" of each case or group
of cases.

This case illustrates the error of precipitate recourse to the Supreme Court, especially when numerous
parties desparately situated as far as the facts are concerned gather under the umbrella of a common
plea, and generalization of what should be alleged with particularity becomes unavoidable. The
petitioners' obvious remedy was NOT to halt the administrative proceedings but, on the contrary, to
take part, assert and vindicate their rights therein, see those proceedings through to judgment and if
adjudged guilty, appeal to the Civil Service Commission; or if, pending said proceedings, immediate
recourse to judicial authority was believed necessary because the respondent Secretary or those acting
under him or on his instructions were acting without or in excess of jurisdiction, or with grave abuse of
discretion, to apply, not directly to the Supreme Court, but to the Regional Trial Court, where there
would be an opportunity to prove the relevant facts warranting corrective relief.

Parties-litigant are duty bound to observe the proper order of recourse through the judicial hierarchy;
they by-pass the rungs of the judicial ladder at the peril of their own causes.23 This Court is a court
of last resort. Its review jurisdiction is limited to resolving questions of law where there is no dispute of
the facts or the facts have already been determined by lower tribunals, except only in criminal actions
where capital penalties have been imposed.

WHEREFORE, both petitioners are DISMISSED, without prejudice to any appeals, if still timely, that the
individual petitioners may take to the Civil Service Commission on the matters complained of. The
motions to withdraw, supra, are merely NOTED, this disposition rendering any express ruling thereon
unnecessary. No pronouncement as to costs.

SO ORDERED.

Fernan, C.J. (Chairman), Melencio-Herrera, Gancayco, Bidin, Griño-Aquino, Medialdea, Regalado and
Davide, Jr., JJ., concur.

Separate Opinions

GUTIERREZ, JR., J., dissenting:

In dissenting from the majority opinion, I draw certain conclusions from the records which I feel should
guide any adjudication of the issues in these petitions.

My first conclusion refers to the denial of basic rights of an indispensably essential segment of our
society the teachers who educate our children.

The second refers to the cold hearted punishment which we allow to be inflicted upon our poor school
teachers. By skirting the fundamental issue involved, the Court is denying the petitioners fairness,
substantive due process, and simple humanity. The so-called investigations which led to the initial
dismissals were a farce. Instead of 90 day preventive suspensions, the Department of Education,
Culture, and Sports (DECS) immediately imposed punitive dismissals with no semblance of rudimentary
due process. All other civil service employees undergoing investigation are reinstated after ninety days.
Our teachers have been out of work for more than ten (10) months without income while still
undergoing administrative investigation. The suspension is indefinite if not permanent.

Patience has its limits. There are times when even the most constant and dedicated public servants must
given vent to their feelings and express their grievances at an unfeeling and inept bureaucracy which
seems to be incapable of attending to their officials needs. Professional agitators may have infiltrated
the teachers and muddled their demands with such outlandish calls as the closure of foreign military
bases, a cap on the payments of foreign debts and other issues not pressingly relevant to teachers. But
the basic demands are legitimate and few.

Teachers need a decent living wage, one in keeping with the dignity and worth of their profession. Not
only are their salaries unbelievably low but payment is often unreasonably delayed. When the national
government gives a little increase, a corresponding amount is reduced from the city share. Teachers
have to beg for allowances to be restored. The latest examples are the PERA adjustments. As of July 12,
1991, most employees of the government had received and spent their PERA allowances. Our public
school teachers were still waiting. whatever the payment signifies salary, bonus, allowance and even
retirement or death benefits the last one to receive what all government employees are entitled to, is
the public school teacher. It is no small wonder that thousands of school teachers swallow their dignity
and accept employment as domestic servants overseas. I am not aware of any government program
which seeks to reverse the new definition of "Filipina" as a domestic servant of foreigners whose
education is often lower than that of their maids. Neither am I aware of any determined effort to see to
it that school teachers always get their salaries, allowances, and benefits on time.

I mention the unconcern because it is what forced the petitioners to engage in mass concerted action.

We agree that employees in the civil service may not engage in strikes, walk-outs and temporary work
stoppages like workers in the private sector. (Social Security System Employees Association v. Court of
Appeals, 175 SCRA 686, 698 [1989]). Employment in the Government is governed by law. Government
workers cannot use the same weapons employed by workers in the private sector to secure concessions
from their employers. The terms and conditions of employment are effected through statutes and
administrative rules and regulations, not through collective bargaining agreements. (Alliance of
Government Workers, et al. v. Minister of Labor and Employment, 124 SCRA 1, 13 [1983]).

The above rulings remain good law.

In the first place, if this Court uses the word "strike" to describe what the petitioners staged, it tends to
unfairly color and pre-judge their case. "Strike" becomes a pejorative epithet that leads to a certain
result not so much because of facts but because of its semantic connotations. The teachers were in the
main not asking for terms and conditions greater than those accorded by law. Their basic demand was
to be given on time what the law already provides for them. It was only after certain elements
penetrated their ranks and in the heat of the peaceful assembly that such demands as closure of military
bases and laws increasing salaries formed part of the leaders' statements. The concerted action was
more of a peaceful assembly, an exercise of speech by a gathering, not a strike.

In the second place, when Government is deaf, when bureaucracy denies to our teachers the timely
payment of the pittances provided by law, should any ban still be enforced? And enforced in a
peremptory and oppressive manner? Should not the most basic freedom of speech and assembly in
these particular cases outweigh all considerations which ban strikes by civil service employees?

We agree with Justice Cardozo in Palko v. Connecticut, 302 US 319 [1937] that freedom of speech is the
matrix, the indispensable condition of nearly every other form of freedom.
We have cited with approbation Justice Brennan's stressing a "profound national commitment to the
principle that debate on public issues should be uninhibited, robust and wide open and that it may well
include vehement, caustic, and sometimes unpleasantly sharp attacks on government and public
officials". (New York Times, Co. v. Sullivan, 376 US 254 [1964])

Teachers have legitimate and pressing grievances. When Government consistently fails to act on these
grievances, the teachers have a right to speak in an effective manner. For speech to be effective, it must
be forceful enough to make the intended recipients listen.

I view the issue in these cases as more transcendent than the simple one of whether or not public school
teachers may go on strike. To me, the issue is the freedom to effectively speak. When the members of a
noble profession are demeaned by low salaries and inattention to their needs, surely their freedom to
speak in a manner and at a time as is most effective far outweighs conventional adherence to orthodox
civil service rules on proper conduct and correct behavior.

My other point has to do with an anomalous investigation procedure and considering the nature of the
offense, what is tantamount to cruel punishment.

I gather from the records and the majority opinion that the cases of individual teachers are still being
investigated and may be the subject of appeals to the Civil Service Commission.

If that is so, I cannot understand why the petitioners remain suspended up to the present. They should
have been reinstated after 90 days of preventive suspension. It is axiomatic that civil service employees
and even elected officials cannot be preventively suspended for more than 90 days (Section 42, P.D.
807; Deloso v. Sandiganbayan, 173 SCRA 409 [1989]; Doromal v. Sandiganbayan, 177 SCRA 354 [1989]).

If the suspension is preventive, it has lasted too long. If punitive, it is illegal and violative of due process.

There are anywhere from 800 to 2,000 teachers involved perhaps even more, once the unwieldy
procedures of DECS can arrive at accurate figures.

On October 8, 1990, the Department Secretary constituted an investigating committee of four, repeat,
four members to act on the formal charges.

Three days later, on October 11, 1990, the DECS found 20 teachers guilty and dismissed them. On
December 3, 1990, 658 teachers were dismissed, 40 were suspended for one year, 33 for 9 months, and
122 for six months. There were 398 exonerations. I understand there were scores who had to hurriedly
look for medical certificates that they were "sick" while hundreds were urged to cringe and grovel with
humiliating mea culpas.

Even if the investigating committee or committees were staffed by supermen and superwomen, it is
inconceivable that 658 capital sentences of dismissal could be made in so short a time. Any officer who
has conducted an honest to goodness administrative investigation cannot but conclude that the
procedures which were followed violated the norms of fair play and due process. The decisions were the
products of prejudgment based on perfunctory paper investigations. Surely our public school teachers
deserve better treatment.

If subsequent to the sentences of dismissal, the teachers were properly served with summons, given
time to secure the services of competent counsel, allowed to defend themselves and cross-examine
witnesses against them, punished on the basis of reasoned decisions stating the facts and the law, and
otherwise given their rights to due process, the initial illegal actions should be set aside and the teachers
reinstated in the meantime.

Considering the circumstances which led the teachers to engage in mass action, the penalty of dismissal
is too grave. It is punishment which is cruel.

The officers and men of the Armed Forces who started a coup at the Manila Hotel were punished by
being made to do a few push-ups. The coup attempt in December, 1989 was almost successful. And yet,
only the officers are meted significant punishment. The enlisted men are readily pardoned. I see no
reason why similar treatment cannot be given our public school teachers. Their only offense was to
speak out in an effective manner against studied neglect.

Even if all requirements of due process in administrative investigations are followed and the evidence
points unerringly to guilt, a public school teacher should not be meted out a penalty harsher than a few
months suspension. In Labor Law, dismissals are imposed only against a handful of leaders who
committed acts of violence or instigated illegal strikes. (De Ocampo, Jr. v. NLRC, 186 SCRA 360 [1990]) As
earlier stated, the word "strike" under Labor Law should not be used in pejoration to denigrate a
peaceful assembly.

I repeat that equitable considerations call for compassion. Public school teachers are the most hard-
working, uncomplaining, easy to satisfy, and dutiful segment of our public service. They are also the
most underpaid professionals with a take home pay of a little over one hundred pesos a day, ** which is
the income of an unskilled laborer.1âwphi1 They deserve justice and compassion.

CONSIDERING THE FOREGOING, I vote to GRANT the petition, to set aside the questioned orders of the
Secretary of Education, Culture, and Sports, to order reinstatement of the petitioners, and to direct the
payments of their salaries and backpay.

CRUZ, J.,  dissenting:

It appears to me from my reading of the ponencia and the several dissents that the petitioners have
established a prima facie case of arbitrariness on the part of the government that would justify direct
and immediate action from the Court as an exception to the regular procedure.

While I do agree that there are many factual matters to be ascertained and that this task belongs in the
first instance to the administrative authorities, I feel that precisely because of the number and proximity
of these issues, let alone the hundreds if not thousands of teachers involved, this Court must grant the
petitioners at least temporary relief pending the termination of the proceedings below. These
proceedings have been dragging on for months and will continue even longer, perhaps for years. In the
meantime, the petitioning teachers are out in the cold, without employment or income and with only
their hope, grown forlorn, I am afraid, in the justice of this Court.

I can understand Justice Narvasa's concern over the disarrangement of the well-ordered system of
judicial review and the resultant heavy burden that will be laid on the Court. However, I do not propose
that we assume the role of the trier of facts and encumber ourselves with the task of deciding the
hundreds of administrative cases being heard (or better heard) below by the DECS or the Civil Service
Commission. I am not prepared at this point to say that the Court should simply pronounce the dismissal
of the petitioners as arbitrary and to order their reinstatement with back salaries. I would instead join
Justice Padilla's suggestion that the teachers be ordered reinstated in the meantime, without prejudice
to their investigation in accordance with the prescribed procedure.

I am not unaware of the decision of the Court in the SSS case prohibiting members of the Civil Service
from engaging in strikes and similar acts. I submit, however that this ruling, assuming it to be correct, is
no license for the authorities to treat their employees with disdain and to flatly ignore their legitimate
complaints, with the expressed threat that they would be removed if they should be so rash as to insist
on their demands. In my view, that is what Secretary Carino has done.

Government workers, whatever their category or status, have as much right as any person in the land to
voice their protests against what they believe to be a violation of their interests. The fact that they
belong to the Civil Service has not deprived them of their freedom of expression, which is guaranteed to
every individual in this country, including even the alien. It would be ridiculous to even suggest that by
accepting public employment, the members of the Civil Service automatically and impliedly renounce
this basic liberty. This freedom can at best be regulated only but never completely withdrawn.

When their first feeble complaints were not acted upon, the teachers had a light to speak loudly and
more insistently, and to show that their protests did not come from only a disgruntled few but from a
considerable number of them. They did this through their mass action in hopes that this way they would
be better heard and ultimately heeded. They were not. Instead, they were threatened with dismissal
and some were in fact dismissed. In effect, they were told to shut up or face the consequences. I regard
the return- to-work order as merely secondary and incidental, for the primary purpose of the DECS
authorities was to break up the demonstration and muzzle the demonstrators. unquestionably, these
individual teachers could not speak as effectively in their controlled classrooms. What the Secretary
sought was to deny the teachers the light to assemble and petition the government for redress of their
grievances on the sanctimonious excuse that they were needed by their students.

I for one believe that the prohibition of members of the Civil Service from striking which, significantly, is
not found in the Constitution requires a careful re-examination. It is so easy, as the present case has
demonstrated, to use it as a bludgeon to silence complaint, however legitimate. Complaint is a weapon
of the worker, and it is more effective if manifested not by him alone but with his co-owners. Under the
present ruling, the workers in the private sector may complain collectively and if necessary declare a
strike to enforce their demands, but this recourse is denied the public employees even if their demands
are no less valid. In this sense, the freedom of expression of the civil servant is diminished and his right
to improve the conditions of his employment is correspondingly reduced, and order because he belongs
to the public sector.

It is so easy to say that the education of the youth should not be disrupted but we should not forget that
the protection of freedom of expression is no less important. Indeed, the quality of education would
deteriorate in an atmosphere of repression, when the very teachers who are supposed to provide an
example of courage and self-assertiveness to their pupils can speak only in timorous whispers. The
classrooms should be an incubator of freedom, not fear.

PARAS, J., concurring
I concur. Public school teachers have the right to peaceably assemble for redress of grievances but NOT
during class hours, for then this would be a strike, which is illegal for them.

FELICIANO, J., dissenting:

With regret, I find myself unable to concur in the majority opinion. I would associate myself with the
reasoning and conclusions (though not necessarily with all the adjectives and adverbs) of the dissenting
opinion of Gutierrez, J. as well as the conclusions reached by Padilla and Sarmiento, JJ., in their
respective dissenting opinion.

Here I merely wish to underscore the constitutional issue which appears to me to be raised in the
instant case by the contraposition of, on the one hand, the prohibition against employees in the public
sector going on strikes and, on the other hand, the rights of free speech and of assembly and petition of
those same employees. In Social Security System Employees Association (SSSEA) v. Court of Appeals (175
SCRA 686 [1989]), the Court, through Cortes, J., pointed out that the prohibition against strikes in the
public sector is presently founded upon Memorandum Circular No. 6, Series of 1987, of the Civil Service
Commission dated 21 April 1987, and indirectly and impliedly, upon Executive Order No. 180 dated 1
June 1987 which provides guidelines for the exercise of the constitutional right of government
employees to organize themselves. The prohibition is not, in other words, even statutory in nature but
merely administrative or regulatory in character and the Court took explicit note of the absence of
legislation either prohibiting or allowing strikes, or even merely regulating the exercise of a right to
strike by government employees. The policy embodied in that prohibition is admittedly a legitimate and
important one: to prevent or minimize the disruption and paralysis of the operations of government,
especially the essential services rendered by it to society at large. At the same time, that the rights of
free speech and of peaceful assembly and petition for redress of grievances are at least equally
important and critical for the maintenance of a free, open and democratic polity, is not disputed by any
one.

It seems to me that the majority opinion has considered the administrative prohibition of strikes in the
government sector as an absolute given. There appears no visible evidence of an effort to explore the
scope and limits of applicability of that prohibition. It would seem reasonably clear, however, that we
cannot semper et ubique give exclusive relevance to that simple prohibition, that there are at stake here
also the competing public values and interests implicit in free speech and peaceable assembly and
petition, and that those rights too cannot be treated as absolutes without any regard to the necessities
of orderly and efficient governance of a developing country with obviously finite resources. The
requirements of both desiderata must be balanced, consciously, with realism and sensitivity, in
particular situations such as that presented in the instant case and points or lines of equilibrium drawn,
however tentatively.1

My concern, and this is submitted with great respect, is that in the instant case, the Court has not
sufficiently engaged in the required balancing operation and had instead acted and spoken as if the
order societal interest involved is that of the government in the maintenance of its operations and
activities. The teaching of school children is obviously important, indeed fundamental. Some of the
leaders of some of the teachers' organizations may be non-teachers and possibly professional agitators.
But the refusal to meet with and discuss the pleas and grievances of the genuine public school teachers
and the summary and mass disciplinary sanctions with which the respondent DECS officials have
responded may produce, and appear in fact to have produced, the very stoppage and prolonged
disruption which Memorandum Circular No. 6 seeks to avoid.

There is, of course, no facile formula by which the competing interests may be adjusted and balanced,
one with the other, in very specific contexts like the one here existing. But adjustments and compromise
there must be. It seems to me very difficult to suppose that government service may be rendered only
at the cost of foregoing the exercise (or, as Gutierrez, J. puts it, the effective exercise) of the rights of
free speech and assembly and petition. To require civil servants in general, and public school teachers in
particular, to leave at home their constitutional rights when they go to work, is to exact mindless
conformity and ductility, no matter how immediate serious and pervasive the problems and grievances
may be, as the cost of serving the Republic. That those problems and grievances may at bottom be
economic rather than political certainly does not change the legal equation. Such an exaction is not to
be counternanced in our constitutional system: it imposes oppressive costs upon the individual human
spirit and intolerable burdens on national development. I vote to GRANT the Petitions.

PADILLA, J., dissenting:

The majority opinion has compressed the issue to whether there has been a denial of due process to the
teachers, disregarding altogether the constitutional right to peaceably assemble and petition the
government for redress of grievances (Art. III, par. 4 Bill of Rights of the 1987 Constitution). But even
limiting oneself to the issue of denial of due process, the majority opinion asserts that it is not ripe for
adjudication by the Court in the exercise of its review jurisdiction because the issue involves questions
of fact. But why then does the majority opinion proceed to declare/recognize the mass action of the
teachers as illegal? Does this not constitute a categorical finding of fact leaving the dismissed or
suspended teachers without any other recourse?

Due process prior to termination or suspension consisted of, according to the majority opinion, the
following —

On the record, what did happen was that, based on reports submitted by the principals of the various
public schools in Metro Manila, the respondent Secretary of Education had filed motu propio
administrative complaints against the teachers who had taken part in the mass actions and defied the
return-to-work order on assorted charges like grave misconduct, gross neglect of duty, gross violation of
the Civil Service Law, absence without official leave, etc., and placed then under 90-day preventive
suspension. The respondents were served copies of the charge sheets and given five (5) days to submit
answer or explanation. Later, on October 8, 1990, the respondent Secretary constituted an investigating
committee of four (4) to determine and take the appropriate course of action on the formal charges and
designated the special prosecutors on detail with the DECS to handle their prosecution during the
formal hearings.

On October 11, 1990, the respondent Secretary of Education rendered the first of his now questioned
decisions on the administrative complaints. In Case No. DECS 90-002, he found twenty (20) respondent
teachers guilty of the charges proferred against them and dismissed them from office, effective
immediately. In the other investigations that followed and as of December 3, 1990, 658 teachers were
dismissed, 40 were suspended for one (1) year, 33 for nine (9) months, and 122 for six (6) months; 398
were exonerated. (pp. 4-5)
It is to be noted that the above proceedings took place in a charged atmosphere. Objective and
dispassionate appraisal of the merits of each case could hardly be expected in such a setting.

Whenever a governmental body acts so as to injure an individual, the Constitution requires that the act
be consonant with due process of law. The minimum procedural requirements necessary to satisfy due
process depend upon the circumstances and the interests of the parties involved. As stated by Mr.
Justice Frankfurter concurring in Joint Anti-Fascist Refugee Committee v. McGrath, 1951, 341 U.S. 123,
163:

Whether the ex parte procedure to which the petitioners were subjected duly observed 'the rudiments
of fair play' ... cannot ... be tested by mere generalities or sentiments abstractly appealing. The precise
nature of the interest that has been adversely affected, the manner in which this was done, the reasons
for doing it, the available alternatives to the procedure that was followed, the protection implicit in the
office of the functionary whose conduct is challenged, the balance of hurt complained of and good
accomplished these are some of the considerations that must enter into the judicial
judgment.1 (Emphasis supplied)

The nature of the hearings should vary depending upon the circumstances of the particular case.2 The
constitutional guarantee of due process means concurrence of substantive and procedural due process.
The narration in the majority opinion speaks only of the latter, completely disregarding the substance of
petitioners' claims. It would appear that dismissals and suspensions of the teachers were meted out de
rigor and in rapid succession, evidently in retaliation for airing their grievances against the government.
It is not to suggest an elaborate procedural mechanism, but only fidelity to the minimum
safeguards untainted by arbitrariness and undue haste.

In my view, the public school teachers are the silent and unsung heroes of our society. They deserve
more compassion, if not more understanding, when they break their silence to plead and press for
benefits they perceive have been unjustly denied them. For it can not be overlooked that public school
teachers are terribly underpaid when related to the responsibilities they discharge in moulding the
character of our youth. The government should itself undergo an introspective re-arraignment of its
priorities and values in approaching the problem of how to treat the teachers with fairness and justice.

Denial of due process is an issue which is ripe for adjudication right in this Court, and in this case. The
petition should be granted and the cases remanded to the DECS for proper redetermination of the
culpability of each teacher, this time, in an atmosphere compatible with due process. Meanwhile, they
should be reinstated pending the outcome of such proceedings, including a recourse by appeal to the
Civil Service Commission.

SARMIENTO, J., dissenting:

Like Justice Gutierrez; I have difficulty concurring with the majority.

What I indeed find apparent is that a thousand or so of our countrymen will be out of work because the
Supreme Court can not supposedly try facts.

The duty of the Court, as the Constitution expresses it, is, among other things:

... to determine whether or not there has been a grave abuse of discretion ... on the part of any branch
or instrumentality of the Government.1
It is a duty, so I submit, from which the Court can not shirk on the handy excuse that it is being made to
try facts. I submit that it is a duty that often requires, precisely, a factual inquiry.

If we are being asked to try facts, it is not the first time we would have been asked, and complied.
In Lansang v. Garcia,2 we did satisfy ourselves that the facts warranted an act of the Executive. We did
go to great lengths to sift evidence.

The nagging fact (no pun intended) is that apparently, we are not truly talking about "facts" here. The
nagging fact, as Justice Gutierrez points out, is that the petitioners have been under suspension for the
last ten months, and the sole question, apparently, is whether or not in the midst of this fact, Secretary
Carino acted arbitrarily.

I do not think that the majority has understood enough the gravity of teachers' condition. As Justice
Gutierrez points out our teachers have long been the most neglected, yet the most forebearing,
members of the public service. "[I]t [the Government's lack of concern] is what forced the petitioners,"
according to Justice Gutierrez, "to engage in mass concerted action.3 I would like to add that maybe, the
Government had it coming.

As the majority avers, these cases are not all about whether the petitioners could have validly gone on a
strike that question has long been settled by this Court-but rather, whether or not they have been given
due process as a result of investigations arising from the strike. I submit that due process is a perfectly
legitimate issue to debate in Court an issue involving the mentors of the nation's children no less.

I also submit that it is to trivialize the noblest profession, if it is not to trivialize the serious crisis
confronting the state of Philippine education, to dismiss these complaints as if it involved simple
personalities demanding money. If Carino acted as if it were that, and as if it were a matter alone of
"they struck so I fired them" I submit that we ought to know better. The State assures education for
all.4 It also gives priority to education, as an indispensable process in nation-building.5 There is no harm
in listening to our educators. I therefore vote to grant both petitions.