Anda di halaman 1dari 44

G.R. No.

L-19937 April 3, 1979 Moreover, We take judicial notice of the fact in actuality, contracts have
ASSOCIACION DE AGRICULTORES DE TALISAY-SILAY, INC., TRINO been entered to the rates of sharing different from those prescribed in
MONTINOLA, FERNANDO CUENCA, EDUARDO LEDESMA, EMILIO JISON, NILO Section in practically all the milling districts in the Philippines after the
LIZARES, NICOLAS JALANDONI and SECRETARY OF LABOR, plaintiffs-appellees, passage of the Republic Act 809. Such contemporary construction of the law
vs. TALISAY-SILAY MILLING CO., INC., and LUZON SURETY CO., INC., In actual practice, if indeed challenged by labor in some instances, only
defendants-appellants, PHILIPPINE NATIONAL BANK and THE SUGAR QUOTA proves that, the construction proposed by counsel is not commonly accepted
ADMINISTRATOR, defendants-appellees. by the others concerned much less indubitable.
As regards the plaint that under the terms of Our judgment, payment of
BARREDO, J.: money corresponding to the laborers should be made to the Association or
Motion for reconsideration signed by Attorney Camilo L. Sabio on his the planters who in turn are sentenced to pay the laborers, instead of said
own behalf and on behalf of the law firm of Attorneys Montemayor & money being paid directly to the laborers thru the Minister of Labor, all that
Dimaano as "counsel for the laborers" involved in this case, but not joined by needs be stated is that under Section 1 of the Act, the primary distribution is
any Attorney of the Ministry of Labor, for the reconsideration, for the grounds between the miller and the planters, and the requirement in Section 9
therein discussed, of the decision of this Court dated February 19, 1979. thereof that "any increase in the participation granted the planters ... shall be
Brushing aside as of secondary importance the issue of whether or not divided between the planter and his laborer" in the proportion therein fixed
private counsel who has signed the subject motion for reconsideration and is evidently predicated on the fact that as the employer, the planter is the
whose authority to appear for the Minister of Labor was not affirmed by the one supposed to pay the laborers, albeit it is provided that such payment
Minister when asked to do so by the Court, has the personality to appear in must be done under the supervision of the Minister of Labor pursuant to
this case as counsel of record, and attending instead to the grounds such orders for the enforcement of the said provision as he may issue,
vehemently and lengthily expounded in said motion in order that no obviously to insure the due identity of and full payment to all the laborers
argument as to the merits of the cause of the laborers involved herein may concerned. To avoid however, that the money paid to the Association or the
not remain unresolved, the Court has opted to take up the points raised by planters purportedly for the share of the laborers fixed in the law may served
counsel Sabio which, to be sure, are not really new. its purpose, it is understood that no Part of the 60% of the money to be paid
In synthesis, the basic argument advanced by counsel is that in effect to the planters shall be available to the planter concerned until after the
Republic Act 809 enjoins that, first, contracts between the millers and the Ministry of Labor shall have certified that all his laborers entitled thereto
planters in all sugar milling districts entered into subsequent to June 22, have been fully paid.
1952, the date of its effectivity, may not be taken into account in determining In view of the foregoing, the Court resolved to DENY the motion for
whether or not there was a majority of planters in the district with written reconsideration aforementioned, and in order to terminate once and for all
milling contracts with the central during the crop years material to this case, this litigation of more than a quarter of a century. We hereby declare this
for purposes of the Act's application, and, second, that should any such DENIAL to be FINAL, and Our decision may now be executed. Accordingly,
contracts be entered into, the rate of sharing between the miller and the with the same finality, We hereby DENY the motions of the Association, the
planters should not be less than that prescribed in Section 1 of the Act. As CENTRAL and the amicus curiae Attorneys Tañada, Sanchez, Tañada and
may be seen in Our decision, the Court has already fully considered the Tañada, for extension of time to file their own respective motions for
points raised by counsel and has found them to be insufficiently persuasive, reconsideration.
albeit quite impressive and to a certain degree plausible. We are fully
convinced, however, that the language of the pertinent provisions of the Act, G. R. No. 142399 March 12, 2008
notwithstanding the individual opinions of certain members of Congress PHILIPPINE AIRLINES, INCORPORATED vs PHILIPPINE AIRLINES EMPLOYEES
quoted by counsel, does not evince a definite intent deny to the Planters and ASSOCIATION (PALEA)
millers the freedom of contract to the extent indicated in the motion. Such a DECISION
sacred fundamental right, of the parties may be denied only expressly or by CHICO-NAZARIO, J.:
indubitable implication from the terms and tenor of the statute itself and not This Petition for Review on Certiorari under Rule 45 of the Rules of
in the light of the arguments of particular legislators during the debates in Court, as amended, seeks to set aside the 30 April 1999 Decision[1] and 10
the course of its enactment, which can be inconclusive. To Our mind, the March 2000 Resolution[2] of the Court of Appeals in CA-G.R. SP No. 50161
provision of Section 1 to the effect that "the unrefined sugar ... as wen as by entitled, Philippine Airlines, Inc. v. National Labor Relations Commission and
products" produced in the district "shall be divided between the central and Philippine Airlines Employees Association (PALEA). In the assailed decision,
the planters" in the proportions therein prescribed "in the absence of written the appellate court dismissed the petition filed by petitioner Philippine
milling agreements between the majority of planters and the millers" Airlines, Inc. (PAL) and affirmed the 28 January 1998 Decision[3] and 23 June
unequivocally means that when there are such written milling agreements, 1998 Resolution,[4] both of the First Division of the National Labor Relations
the section would not apply. Notably, this language does not distinguish Commission (NLRC) wherein the said Commission reversed and set aside the
between contracts in force at the time of the enforcement of the Act, on the 12 March 1990 Decision[5] of the Labor Arbiter in NLRC NCR No. 00-03-
one hand, and contracts to be executed thereafter, on the other. To construe 01134-89 dismissing the labor complaint filed by Philippine Airlines
said provision as contemplating only the contracts then in existence and Employees Association (PALEA), the collective bargaining agent of the rank
about to expire to the exclusion of new ones to be executed later is to read and file employees of petitioner PAL.
into the law something it does not suggest at all considering particularly that The present petition arose from a labor complaint,[6] filed by
in the contrary sense, it would be tantamount to an injunction against the respondent PALEA against petitioners PAL and one Mary Anne del Rosario,
execution of new contracts, which would be violative of the fundamental Director of Personnel of petitioner PAL, on 1 March 1989. The labor
right of freedom of contract as distinguished from the constitutional complaint charged both petitioners with unfair labor practice for the alleged
prohibition against impairment of contractual obligations. The Court cannot non-payment of the 13th month pay of petitioner PALs employees who had
see its way clear to the adoption of such a construction, much as it feels that not been regularized as of the 30 of April 1988, allegedly in contravention of
any doubt, if any exists, must be resolved in favor of giving labor the the Collective Bargaining Agreement (CBA) entered into by petitioner PAL and
maximum benefit derivable from social legislations, such as Republic Act 809 respondent PALEA.
should be deemed to be. Indeed, if social justice is to remain a noble and The facts are undisputed.
worthy ideal, it must be practiced without unnecessary infringement of the On 6 February 1987, petitioner PAL and respondent PALEA entered into
inalienable liberties consecrated in the fundamental law of the land for the a CBA[7] covering the period of 1986-1989, to be applied, thus:
promotion of the general welfare, unless there is clear and unmistakable Section 3 Application
warrant for the exertion of state power. We have said in Our decision 'that in All the terms and conditions of employment of employees within the
appropriate instances social justice may be more compelling and imperious bargaining unit are embodied in this Agreement, and the same shall
than police power where labor is involved, but the basis for such occasion govern the relationship between the Company and such employees. On
must be definite not equivocal, to avoid the imbalance of rights and the other hand, all such benefits and/or privileges as are not expressly
opportunities which is precisely the aim of social justice to equalize for the provided for in this Agreement but which are now being accorded in
protection of the poor and the underprivileged to which the working class accordance with the PAL Personnel Policies and Procedures Manual,
belong. shall be deemed also part and parcel of the terms and conditions of
employment, or of this Agreement.[8]
Part of said agreement required petitioner PAL to pay its rank and file Buenaventura, Rene Zaragoza, Ronald Lumibao, Ruel Villareal and Rene Philip
employees the following bonuses: Banzon.
Section 4 13th Month Pay (Mid-year Bonus) We would like to clarify the following:
A 13th month pay, equivalent to one months current basic pay, 1. The above-mentioned employees and other similarly situated employees
consistent with the existing practice shall be paid in advance in May. were not paid the 13th month pay on May 9, 1988 because they were not
qualified regular employees as of April 30, 1988. However, the guidelines
Section 5 Christmas Bonus provide that they should be granted their 13th month pay on or before
The equivalent of one months current basic pay as of November 30, December 24, 1988.
shall be paid in December as a Christmas bonus. Payment may be 2. The guideline providing for the payment of the 13th month pay on or
staggered in two (2) stages. It is distinctly understood that nothing before December 24, 1988 for those who were not entitled to receive such in
herein contained shall be construed to mean that the Company may not May is anchored on the Companys compliance with the Rules and
at its sole discretion give an additional amount or increase the Regulations Implementing PD 851 (pp. 236-237, Labor Code of the
Christmas bonus.[9] Philippines 1988 Edition), to wit:
On 22 April 1988, prior to the payment of the 13th month pay (mid-year Sec. 3. Employees covered the Decree shall apply to all employees
bonus), petitioner PAL released a guideline[10] implementing the except to: x x x
aforequoted provision, to wit: c) Employers already paying their employees 13-month pay or more in a
1) Eligibility calendar year or its equivalent at the time of this issuance; x x x
a) Ground employees in the general payroll who are regular as of the term its equivalent as used in paragraph (c) hereof shall include
April 30, 1988; Christmas bonus, mid-year bonus, profit-sharing payments and other
b) Other ground employees in the general payroll, not falling cash bonuses amounting to not less than 1/12th of the basic salary but
within category a) above shall receive their 13th Month Pay on or shall not include cash and stock dividends, cost of living allowances and
before December 24, 1988; all other allowances regularly enjoyed by the employee, as well as non-
2) Amount monetary benefits.
a) For category a) above, one month basic salary as of April 30, 3. In accordance with 1 and 2, the above-mentioned employees were paid
1988; the equivalent of their 13th month pay in the form of the Christmas bonus
b) Employees covered under 1 b) above shall be paid not less than granted by the Company on December 9, 1988. The same was applied to
1/12 of their basic salary for every month of service within the similarly situated employees in compliance with pertinent provisions of the
calendar year. 1986-1989 PAL-PALEA CBA and the Labor Code of the Philippines.
3) Payment Date: May 9, 1988 for category 1 a) above.[11] (SGD.) MARIE ANNE E. DEL ROSARIO[15]
Respondent PALEA assailed the implementation of the foregoing
guideline on the ground that all employees of PAL, regular or non-regular, Disagreeing with petitioner PAL, respondent PALEA filed a labor
must be paid their 13th month pay. In fact, in a letter dated 16 December complaint[16] for unfair labor practice against petitioner PAL before the NLRC
1988, respondent PALEA, through Herbert C. Baldovino,[12] informed on 1 March 1989. The complaint interposed that the cut-off period for
petitioner PAL that the following regular employees failed to receive their regularization should not be used as the parameter for granting [the] 13th
13th Month Pay as of the date of the correspondence. Said letter reads in month pay considering that the law does not distinguish the status of
part: employment but (sic) the law covers all employees.
16 December 1988 In its Position Paper submitted before the Labor Arbiter, petitioner PAL
To : Ms. Marie Anne E. Del Rosario countered that those rank and file employees who were not regularized by 30
Director-Personnel Services April of a particular year are, in principle, not denied their 13th month pay
From : PALEA Board Member-Engineering considering they receive said mandatory bonus in the form of the Christmas
Subject : 13th Month Pay Bonus; that the Christmas Bonus given to all its employees is deemed a
Please be informed that the following regular employees have not compliance with Presidential Decree No. 851 and the latters implementing
received their 13th month pay as of today. rules; and that the foregoing has been the practice formally adopted in
NAME Date Employed Date Regularized previous CBAs as early as 1970.
1. Renato C. Buenaventura -Nov. 17, 1987 May 17, 1988 On 12 March 1990, the Labor Arbiter rendered a Decision dismissing
2. Rene Zaragoza -Dec. 1, 1987 June 1, 1988 the respondent PALEAs complaint for lack of merit. The Labor Arbiter ruled
3. Ronald Lumibao -Dec. 1, 1987 June 1, 1988 that petitioner PAL was not guilty of unfair labor practice in withholding the
4. Ruel Villa-real -Dec. 1, 1987 June 1, 1988 grant of the 13th Month Pay or Mid Year Bonus to the concerned employees.
5. Rene Philip Banzon -Dec. 1, 1987 June 1, 1988 The giving of the particular bonus was said to be merely an additional
We feel that these employees are entitled to the 13th month pay in practice made in the past, such being the case, it violated no agreement or
accordance with the guidelines issued by your office last 22 April 1988. (Copy existing practice or committed unfair labor practice, as charged.[17] The
attached.) decretal part of said ruling reads:
May we request your good office to do the necessary to effect payment WHEREFORE, decision is hereby issued ordering the dismissal of the
of the 13th month pay to the above listed regular employees in the next complaint.[18]
regular payroll. Respondent PALEA appealed to the NLRC. In a Decision dated 28
Praying for usual prompt attention. January 1998, the Commission reversed the Decision of the Arbiter. The fallo
(Sgd.) HERBERT C. BALDOVINO of said decision is quoted hereunder:
WHEREFORE, finding the appeal well-impressed with merit, the
In response thereto, petitioner PAL informed respondent PALEA that decision appealed from is REVERSED and SET ASIDE and a new one ENTERED
rank and file employees who were regularized after 30 April 1988 were not ordering [herein petitioner] PAL to pay the 13th month pay or mid-year
entitled to the 13th month pay as they were already given their Christmas bonus of the members as discussed above.[19]
bonuses on 9 December 1988 per the Implementing Rules of Presidential The NLRC held that after going through the documents submitted by
Decree No. 851.[14] Petitioner PALs response is hereunder quoted in full respondent PALEA in support of its contention, the Commission is convinced
January 2, 1989 that the 13th month pay or mid-year bonus is distinct from the Christmas
Mr. Herbert C. Baldovino Bonus, and although petitioner PAL already paid its employees the latter, it
PALEA Board Member and must likewise pay them the former. Petitioner PAL moved for reconsideration
Mr. George M. Pulido of the NLRC Decision but this was denied in a Resolution dated 23 June 1998.
PALEA President Undaunted, petitioner PAL went directly to this Court via a Petition for
2nd Floor, Philbanking Bldg. Review on Certiorari. In view of this Courts decision in St. Martin Funeral
Baclaran, Paraaque, M.M. Homes v. National Labor Relations Commission,[20] however, the Petition
Dear Messrs. Baldovino and Pulido: was referred to the Court of Appeals for proper disposition. The case was
This pertains to your letter which we received on December 19, 1988 docketed therein as CA-G.R. SP No. 50161.
requesting for payment of 13th month pay to employees: Renato
On 30 April 1999, the Court of Appeals promulgated its Decision being accorded in accordance with the PAL Personnel Policies and
dismissing the Petition filed by petitioner PAL, hence, affirming the 28 Procedures Manual, shall be deemed also part and parcel of the terms
January 1998 Decision of the NLRC. The dismissal reads and conditions of employment, or of this Agreement.
WHEREFORE, premises considered, the instant petition is hereby without distinguishing between regular and non-regular employees. As
DISMISSED for lack of merit.[21] succinctly put by respondent PALEA in its Memorandum:
The Court of Appeals held that from the x x x provision of the said inter- All employees in (sic) PAL are entitled to the same benefit as they are
office memo, employees who are regular as of 30 April 1988 and those within the same collective bargaining unit and the entitlement to such
regularized thereafter, are entitled for (sic) the payment of the non-regular benefit spills over to even non-union members.
employees as provided for under letter (c) of the Guidelines issued. It It is a well-settled doctrine that the benefits of a CBA extend to the
reasoned that if the intention is not to include employees regularized beyond laborers and employees in the collective bargaining unit, including those who
30 April 1988, they would not have placed letter (c). The Court of Appeals do not belong to the chosen bargaining labor organization. Otherwise, it
further rationalized that well-settled is the rule that all doubts should be would be a clear case of discrimination.
resolved in favor of labor. To rule otherwise is a betrayal of our zealous Hence, to be entitled to the benefits under the CBA, the employees
commitment to uphold the constitutional provision affording protection to must be members of the bargaining unit, but not necessarily of the labor
labor.[24] organization designated as the bargaining agent. A bargaining unit has been
Petitioner PAL seasonably moved for the reconsideration of the defined as a group of employees of a given employer, comprised of all or less
aforequoted Court of Appeals Decision, but was also denied in a Resolution than all of the entire body of employees, which the collective interest of all
dated 10 March 2000. the employees, consistent with equity to the employer, indicates to be the
Hence, the instant Petition for Review on Certiorari under Rule 45 of the best suited to serve the reciprocal rights and duties of the parties under the
Rules of Court, as amended. collective bargaining provisions of the law.[33] At this point, the allegation of
In a Resolution dated 19 June 2007, We resolved to suspend the petitioner PAL that the non-regular employees do not belong to the collective
proceedings of the case at bar in view of the on-going rehabilitation of bargaining unit and are thus not covered by the CBA is unjustified and
petitioner PAL as mandated by the Securities and Exchange Commission. On unsubstantiated. It is apparent to us that petitioner PAL excludes certain
28 September 2007, however, the SEC issued an Order[26] granting petitioner employees from the benefits of the CBA only because they have not yet
PALs request to exit from rehabilitation after successfully stabilizing its achieved regular status by the cut-off date, 30 April 1988. There is no
financial operations. Hence, the suspension earlier issued by this Court is showing that the non-regular status of the concerned employees by said cut-
hereby lifted, making the present Petition ripe for resolution. off date sufficiently distinguishes their interests from those of the regular
In refusing payment of the mid-year bonus, petitioner PAL argues that employees so as to exclude them from the collective bargaining unit and the
1) the CBA does not apply to non-regular employees such that any benefits benefits of the CBA.
arising from said agreement cannot be made to apply to them, including the Having ruled that the benefits provided by the subject CBA are
mid-year bonus; and 2) it has always been the company practice not to applicable even to non-regular employees who belong to the bargaining unit
extend the mid-year bonus to those employees who have not attained concerned, the next and crucial query to be addressed is whether the 13th
regular status prior to the month of May, when payment of the particular month pay or mid-year bonus can be equated to the Christmas bonus.
bonus accrues. Petitioner PAL equates the 13th month pay, also referred to as the mid-
Respondent PALEA, however, disputes petitioner PALs allegations and year bonus in the CBA, to the Christmas bonus. It insists that [u]nder the 13th
maintains that the benefits to all employees in the collective bargaining unit, Month Pay Law (P.D. 851, as amended), the 13th Month Pay is due on or
including those who do not belong to the chosen bargaining labor before December 24th of the year. Therefore, non-regular employees are
organization, applies.[27] Put in another way, [a]ll employees in PAL are entitled to their 13th Month Pay, not in the month of May, but in the month
entitled to the same benefit as they are within the same collective bargaining of December when the Christmas Bonus becomes due. The Christmas bonus
unit and the entitlement to such benefit spills over to even non-union becomes their 13th Month Pay, by express provision of Section 2, Presidential
members.[28] Anent the supposed company practice of petitioner PAL not to Decree 851.[34] Simply put, as far as non-regular employees are concerned,
extend the payment of the 13th month pay or mid-year bonus to non-regular petitioner PAL alleges that their 13th month pay shall be the same as their
employees, respondent PALEA contends that non-payment of said benefit is Christmas bonus and will be paid according to the terms governing the latter.
considered a diminution of privileges or benefits proscribed by Presidential We do not agree. From the facts of the present Petition, it is crystal
Decree No. 851; that petitioner PAL misrepresented that the 13th month pay clear that petitioner PAL is claiming an exemption from payment of the 13th
or mid-year bonus is the same as the Christmas bonus when, in actuality, the month pay or mid-year bonus provided in the CBA under the guise of paying
latter is entirely different as it is a benefit paid under the provisions of the the Christmas bonus which it claims to be the equivalent of the 13th month
CBA, while the former is one mandated by law, Presidential Decree No. 851, pay under Presidential Decree No. 851.
in particular. Presidential Decree No. 851 mandates that all employers must pay all
The sole issue for resolution of this Court is whether or not the Court of their employees receiving a basic salary of not more than P1,000.00 a month,
Appeals committed reversible error in affirming the order of the NLRC for the regardless of the nature of the employment, a 13th month pay not later than
payment of the 13th month pay or mid-year bonus to its employees 24 December of every year. Memorandum Order No. 28,[35] dated 13 August
regularized after 30 April 1988. We rule in the negative. 1986, removed the salary ceiling, generally making all employees entitled to
Petitioner PAL maintains that in extending the grant of the 13th month the 13th month pay regardless of the amount of their basic salary,
pay or mid-year bonus to employees who are not covered by the CBA, the designation or employment status, and irrespective of the method by which
Court of Appeals, in effect, modified or altered the terms of said agreement their wages are paid, provided that they have worked for at least one (1)
and expanded its coverage to non-regular employees who are not covered by month during a calendar year.[36] Presidential Decree No. 851, as amended,
the bargaining unit.[29] The issue on modification or alteration of the CBA, does admit of certain exceptions or exclusions from its coverage, among
however, was raised by petitioner PAL rather belatedly and invoked for the which is:
first time on appeal. This being the case, We are barred from taking Sec. 3(c). Employers already paying their employees 13-month pay or
cognizance of and resolving the issue for it would be violative of the more in a calendar year or its equivalent at the time of this issuance.
proscription against the presentation of new issues on appeal. To do While employers already paying their employees a 13th month pay or
otherwise would be offensive to the basic rules of fair play, justice and due more in a calendar year or its equivalent at the time of the issuance of
process.[30] Presidential Decree No. 851 are already exempted from the mandatory
Be that as it may, a cursory reading of the 1986-1989 CBA of the parties coverage of said law, petitioner PAL cannot escape liability in this case by
herein will instantly reveal that Art. I, Sec. 3 of said agreement made its virtue thereof.
provision applicable to all employees in the bargaining unit. The particular It must be stressed that in the 1986-1989 CBA, petitioner PAL agreed to
section specifically defined the scope of application of the CBA, thus: pay its employees 1) the 13th month pay or the mid-year bonus, and 2) the
Section 3 Application. All the terms and conditions of employment of Christmas bonus. The 13th month pay, guaranteed by Presidential Decree No.
employees within the bargaining unit are embodied in this Agreement, 851, is explicitly covered or provided for as the mid-year bonus in the CBA,
and the same shall govern the relationship between the Company and while the Christmas bonus is evidently and distinctly a separate benefit.
such employees. On the other hand, all such benefits and/or privileges Petitioner PAL may not be allowed to brush off said distinction, and
as are not expressly provided for in this Agreement but which are now
unilaterally and arbitrarily declare that for non-regular employees, their hours of work and all other terms and conditions of employment in a
Christmas bonus is the same as or equivalent to the 13th month pay. bargaining unit.[40] As in all other contracts, the parties to a CBA may
Presidential Decree No. 851 mandates the payment of the 13th month establish such stipulations, clauses, terms and conditions as they may deem
pay to uniformly provide the low-paid employees with additional income. It convenient, provided these are not contrary to law, morals, good customs,
but sets a minimum requirement that employers must comply with. It does public order or public policy.[41] Thus, where the CBA is clear and
not intend, however, to preclude the employers from voluntarily granting unambiguous, it becomes the law between the parties, and compliance
additional bonuses that will benefit their employees. A bonus is an amount therewith is mandated by the express policy of the law.[42]
granted and paid to an employee for his industry and loyalty which WHEREFORE, premises considered, the petition is hereby DENIED.
contributed to the success of the employer's business and made possible the The Decision of the Court of Appeals promulgated on 30 April 1999, and its
realization of profits. It is an act of generosity of the employer for which the Resolution dated 10 March 2000, are hereby AFFIRMED. Costs against
employee ought to be thankful and grateful. It is also granted by an petitioner Philippine Airlines, Inc. SO ORDERED.
enlightened employer to spur the employee to greater efforts for the success G.R. No. 80609 August 23, 1988
of the business and realization of bigger profits.[37] We deem that the PHILIPPINE LONG DISTANCE TELEPHONE COMPANY, petitioner, vs. THE
Christmas bonus in this case is of this nature, although, by virtue of its NATIONAL LABOR RELATIONS COMMISSION and MARILYN ABUCAY,
incorporation into the CBA, it has become more than just an act of generosity respondents.
on the part of petitioner PAL, but a contractual obligation it has undertaken. CRUZ, J.:
The inclusion of a provision for the continued payment of the Christmas The only issue presented in the case at bar is the legality of the award
bonus in the 1986-1989 CBA between respondent PALEA and petitioner PAL of financial assistance to an employee who had been dismissed for cause as
contradicts the companys claim that the grant of such benefit was intended found by the public respondent.
to be credited as compliance with the statutory mandate to give the 13th Marilyn Abucay, a traffic operator of the Philippine Long Distance
month pay. Memorandum Order No. 28, extending Presidential Decree No. Telephone Company, was accused by two complainants of having demanded
851 to all employees regardless of the amount of their monthly salaries, was and received from them the total amount of P3,800.00 in consideration of
issued on 13 August 1986. As early as said date, therefore, petitioner PAL was her promise to facilitate approval of their applications for telephone
already fully aware that it was lawfully compelled to accord all its employees installation. 1 Investigated and heard, she was found guilty as charged and
a 13th month pay. Accordingly, if petitioner PAL truly intended that the accordingly separated from the service.2 She went to the Ministry of Labor
Christmas bonus be treated as the equivalent of the 13th month pay required and Employment claiming she had been illegally removed. After
by law, then said intention should have been expressly declared in their 1986- consideration of the evidence and arguments of the parties, the company
1989 CBA, or the separate provision therein on the Christmas bonus should was sustained and the complaint was dismissed for lack of merit.
have been removed because it would only be superfluous. Nevertheless, the dispositive portion of labor arbiter's decision declared:
In United CMC Textile Workers Union v. The Labor Arbiter, one of the WHEREFORE, the instant complaint is dismissed for lack of merit.
issues passed upon by the Court was whether or not an employer who was Considering that Dr. Helen Bangayan and Mrs. Consolacion
already paying Christmas bonus pursuant to a CBA, was still bound to pay the Martinez are not totally blameless in the light of the fact that the deal
13th month pay pursuant to Presidential Decree No. 851. Finding that the happened outhide the premises of respondent company and that their act of
intention of the parties to the CBA was that the Christmas bonus was meant giving P3,800.00 without any receipt is tantamount to corruption of public
to be on top of the 13th month pay, the Court ordered the employer to pay officers, complainant must be given one month pay for every year of service
the employees both. The Court ratiocinated: as financial assistance. 3
If the Christmas bonus was included in the 13th month pay, then there Both the petitioner and the private respondent appealed to the
would be no need for having a specific provision on Christmas bonus in the National Labor Relations Board, which upheld the said decision in toto and
CBA. But is did provide for a bonus in graduated amounts depending on the dismissed the appeals. 4 The private respondent took no further action,
length of service of the employee. The intention is clear therefore that the thereby impliedly accepting the validity of her dismissal. The petitioner,
bonus provided in the CBA was meant to be in addition to the legal however, is now before us to question the affirmance of the above- quoted
requirement. x x x A bonus under the CBA is an obligation created by the award as having been made with grave abuse of discretion.
contract between the management and workers while the 13th month pay is In its challenged resolution of September 22, 1987, the NLRC said:
mandated by the law (P.D. 851). ... Anent the award of separation pay as financial assistance in
In the case under consideration, the provision for the payment of the complainant's favor, We find the same to be equitable, taking into
Christmas bonus, apart from the 13th month pay, was incorporated into the consideration her long years of service to the company whereby she had
1986-1989 CBA between respondent PALEA and petitioner PAL without any undoubtedly contributed to the success of respondent. While we do not in
condition. The Christmas bonus, payable in December of every year, is any way approve of complainants (private respondent) mal feasance, for
distinguished from the 13th month pay, due yearly in May, for which reason it which she is to suffer the penalty of dismissal, it is for reasons of equity and
was denominated as the mid-year bonus. Such being the case, the only compassion that we resolve to uphold the award of financial assistance in her
logical inference that could be derived therefrom is that petitioner PAL favor. 5
intended to give the members of the bargaining unit, represented by The position of the petitioner is simply stated: It is conceded that
respondent PALEA, a Christmas bonus over and above its legally mandated an employee illegally dismissed is entitled to reinstatement and backwages as
obligation to grant the 13th month pay. required by the labor laws. However, an employee dismissed for cause is
The non-regular rank and file employees of petitioner PAL as of 30 entitled to neither reinstatement nor backwages and is not allowed any relief
April 1988, are not actually seeking more benefits than what the other at all because his dismissal is in accordance with law. In the case of the
member-employees of the same bargaining unit are already enjoying. They private respondent, she has been awarded financial assistance equivalent to
are only requesting that all members of the bargaining unit be treated ten months pay corresponding to her 10 year service in the company despite
equally and afforded the same privileges and benefits as agreed upon her removal for cause. She is, therefore, in effect rewarded rather than
between respondent PALEA and petitioner PAL in the CBA. Petitioner PAL is punished for her dishonesty, and without any legal authorization or
committing a patent act of inequity that is grossly prejudicial to the non- justification. The award is made on the ground of equity and compassion,
regular rank and file employees there being no rational basis for withholding which cannot be a substitute for law. Moreover, such award puts a premium
from the latter the benefit of a Christmas bonus besides the 13th month pay on dishonesty and encourages instead of deterring corruption.
or mid-year bonus, while the same is being granted to the other rank and file
employees of petitioner PAL who have been regularized as of 30 April 1988, For its part, the public respondent claims that the employee is
although both types of employees are members of the same bargaining unit. sufficiently punished with her dismissal. The grant of financial assistance is
As it had willfully and intentionally agreed to under the terms of the CBA, not intended as a reward for her offense but merely to help her for the loss of
petitioner PAL must pay its regular and non-regular employees who are her employment after working faithfully with the company for ten years. In
members of the bargaining unit represented by respondent PALEA their 13th support of this position, the Solicitor General cites the cases of Firestone Tire
month pay or mid-year bonus separately from and in addition to their and Rubber Company of the Philippines v. Lariosa 6 and Soco v. Mercantile
Christmas bonus. Corporation of Davao, 7 where the employees were dismissed for cause but
A collective bargaining agreement refers to a negotiated contract were nevertheless allowed separation pay on grounds of social and
between a legitimate labor organization and the employer concerning wages, compassionate justice. As the Court put it in the Firestone case:
In view of the foregoing, We rule that Firestone had valid grounds and to justify the helping hand to the validly dismissed employee whatever
to dispense with the services of Lariosa and that the NLRC acted with grave the reason for his dismissal. This policy should be re-examined. It is time we
abuse of discretion in ordering his reinstatement. However, considering that rationalized the exception, to make it fair to both labor and management,
Lariosa had worked with the company for eleven years with no known especially to labor.
previous bad record, the ends of social and compassionate justice would be There should be no question that where it comes to such valid but
served if he is paid full separation pay but not reinstatement without not iniquitous causes as failure to comply with work standards, the grant of
backwages by the NLRC. separation pay to the dismissed employee may be both just and
In the said case, the employee was validly dismissed for theft but compassionate, particularly if he has worked for some time with the
the NLRC nevertheless awarded him full separation pay for his 11 years of company. For example, a subordinate who has irreconcilable policy or
service with the company. In Soco, the employee was also legally separated personal differences with his employer may be validly dismissed for
for unauthorized use of a company vehicle and refusal to attend the demonstrated loss of confidence, which is an allowable ground. A working
grievance proceedings but he was just the same granted one-half month mother who has to be frequently absent because she has also to take care of
separation pay for every year of his 18-year service. her child may also be removed because of her poor attendance, this being
Similar action was taken in Filipro, Inc. v. NLRC, 8 where the another authorized ground. It is not the employee's fault if he does not have
employee was validly dismissed for preferring certain dealers in violation of the necessary aptitude for his work but on the other hand the company
company policy but was allowed separation pay for his 2 years of service. In cannot be required to maintain him just the same at the expense of the
Metro Drug Corporation v. NLRC, 9 the employee was validly removed for loss efficiency of its operations. He too may be validly replaced. Under these and
of confidence because of her failure to account for certain funds but she was similar circumstances, however, the award to the employee of separation pay
awarded separation pay equivalent to one-half month's salary for every year would be sustainable under the social justice policy even if the separation is
of her service of 15 years. In Engineering Equipment, Inc. v. NLRC, 10 the for cause.
dismissal of the employee was justified because he had instigated labor But where the cause of the separation is more serious than mere
unrest among the workers and had serious differences with them, among inefficiency, the generosity of the law must be more discerning. There is no
other grounds, but he was still granted three months separation pay doubt it is compassionate to give separation pay to a salesman if he is
corresponding to his 3-year service. In New Frontier Mines, Inc. v. NLRC, 11 dismissed for his inability to fill his quota but surely he does not deserve such
the employee's 3- year service was held validly terminated for lack of generosity if his offense is misappropriation of the receipts of his sales. This is
confidence and abandonment of work but he was nonetheless granted three no longer mere incompetence but clear dishonesty. A security guard found
months separation pay. And in San Miguel Corporation v. Deputy Minister of sleeping on the job is doubtless subject to dismissal but may be allowed
Labor and Employment, et al ., 12 full separation pay for 6, 10, and 16 years separation pay since his conduct, while inept, is not depraved. But if he was
service, respectively, was also allowed three employees who had been in fact not really sleeping but sleeping with a prostitute during his tour of
dismissed after they were found guilty of misappropriating company funds. duty and in the company premises, the situation is changed completely. This
The rule embodied in the Labor Code is that a person dismissed is not only inefficiency but immorality and the grant of separation pay would
for cause as defined therein is not entitled to separation pay. 13 The cases be entirely unjustified.
above cited constitute the exception, based upon considerations of equity. We hold that henceforth separation pay shall be allowed as a
Equity has been defined as justice outside law, 14 being ethical rather than measure of social justice only in those instances where the employee is
jural and belonging to the sphere of morals than of law. 15 It is grounded on validly dismissed for causes other than serious misconduct or those reflecting
the precepts of conscience and not on any sanction of positive law. 16 Hence, on his moral character. Where the reason for the valid dismissal is, for
it cannot prevail against the expressed provision of the labor laws allowing example, habitual intoxication or an offense involving moral turpitude, like
dismissal of employees for cause and without any provision for separation theft or illicit sexual relations with a fellow worker, the employer may not be
pay. required to give the dismissed employee separation pay, or financial
Strictly speaking, however, it is not correct to say that there is no assistance, or whatever other name it is called, on the ground of social
express justification for the grant of separation pay to lawfully dismissed justice.
employees other than the abstract consideration of equity. The reason is that A contrary rule would, as the petitioner correctly argues, have the
our Constitution is replete with positive commands for the promotion of effect, of rewarding rather than punishing the erring employee for his
social justice, and particularly the protection of the rights of the workers. The offense. And we do not agree that the punishment is his dismissal only and
enhancement of their welfare is one of the primary concerns of the present that the separation pay has nothing to do with the wrong he has committed.
charter. In fact, instead of confining itself to the general commitment to the Of course it has. Indeed, if the employee who steals from the company is
cause of labor in Article II on the Declaration of Principles of State Policies, granted separation pay even as he is validly dismissed, it is not unlikely that
the new Constitution contains a separate article devoted to the promotion of he will commit a similar offense in his next employment because he thinks he
social justice and human rights with a separate sub- topic for labor. Article XIII can expect a like leniency if he is again found out. This kind of misplaced
expressly recognizes the vital role of labor, hand in hand with management, compassion is not going to do labor in general any good as it will encourage
in the advancement of the national economy and the welfare of the people in the infiltration of its ranks by those who do not deserve the protection and
general. The categorical mandates in the Constitution for the improvement of concern of the Constitution.
the lot of the workers are more than sufficient basis to justify the award of The policy of social justice is not intended to countenance
separation pay in proper cases even if the dismissal be for cause. wrongdoing simply because it is committed by the underprivileged. At best it
The Court notes, however, that where the exception has been may mitigate the penalty but it certainly will not condone the offense.
applied, the decisions have not been consistent as to the justification for the Compassion for the poor is an imperative of every humane society but only
grant of separation pay and the amount or rate of such award. Thus, the when the recipient is not a rascal claiming an undeserved privilege. Social
employees dismissed for theft in the Firestone case and for animosities with justice cannot be permitted to be refuge of scoundrels any more than can
fellow workers in the Engineering Equipment case were both awarded equity be an impediment to the punishment of the guilty. Those who invoke
separation pay notnvithstanding that the first cause was certainly more social justice may do so only if their hands are clean and their motives
serious than the second. No less curiously, the employee in the Soco case was blameless and not simply because they happen to be poor. This great policy
allowed only one-half month pay for every year of his 18 years of service, but of our Constitution is not meant for the protection of those who have proved
in Filipro the award was two months separation pay for 2 years service. In they are not worthy of it, like the workers who have tainted the cause of
Firestone, the emplovee was allowed full separation pay corresponding to his labor with the blemishes of their own character.
11 years of service, but in Metro, the employee was granted only one-half Applying the above considerations, we hold that the grant of
month separation pay for every year of her 15year service. It would seem separation pay in the case at bar is unjustified. The private respondent has
then that length of service is not necessarily a criterion for the grant of been dismissed for dishonesty, as found by the labor arbiter and affirmed by
separation pay and neither apparently is the reason for the dismissal. the NLRC and as she herself has impliedly admitted. The fact that she has
The Court feels that distinctions are in order. We note that worked with the PLDT for more than a decade, if it is to be considered at all,
heretofore the separation pay, when it was considered warranted, was should be taken against her as it reflects a regrettable lack of loyalty that she
required regardless of the nature or degree of the ground proved, be it mere should have strengthened instead of betraying during all of her 10 years of
inefficiency or something graver like immorality or dishonesty. The service with the company. If regarded as a justification for moderating the
benediction of compassion was made to cover a multitude of sins, as it were, penalty of dismissal, it will actually become a prize for disloyalty, perverting
the meaning of social justice and undermining the efforts of labor to cleanse finding of a prima facie case of illegal strike and unfair labor practice
its ranks of all undesirables. committed by the members of the two unions, Case No. 5612-ULP of the
The Court also rules that the separation pay, if found due under Court of Industrial Relations for unfair labor practice was filed against them.8
the circumstances of each case, should be computed at the rate of one There was on May 27, 1971, an answer with affirmative defenses filed in such
month salary for every year of service, assuming the length of such service is case.9 Earlier, on May 20, 1971, the petitioner filed identical motions in MC
deemed material. This is without prejudice to the application of special Cases Nos. 2995 and 2996 to hold in abeyance the hearings of the petitions
agreements between the employer and the employee stipulating a higher for certification election. 10 Then, on August 5, 1971, respondent Court,
rate of computation and providing for more benefits to the discharged through Judge Ansberto Paredes, denied the petitioner's motions to hold in
employee. 17 abeyance the hearing of MC Cases Nos. 2995 and 2996. 11
WHEREFORE, the petition is GRANTED. The challenged resolution
of September 22,1987, is AFFIRMED in toto except for the grant of separation The challenged order of Judge Paredes stated the nature of the issue before
pay in the form of financial assistance, which is hereby DISALLOWED. The him as well as the respective positions of the parties: "Submitted for
temporary restraining order dated March 23, 1988, is LIFTED. It is so ordered. resolution without further arguments are petitioner's motions filed in each of
the above-entitled cases, praying that the proceedings therein be held in
Narvasa, Melencio-Herrera, Gutierrez, Jr., Paras, Feliciano, Gancayco, Bidin, abeyance pending final judgment in Case No. 5612-ULP and the oppositions
Sarmiento, Cortes and Medialdea, JJ., concur. thereto filed by the respondent unions. It is petitioner's stand that if Case No.
5612-ULP will prosper and the strike staged by respondent unions during the
pendency of the instant cases will be declared illegal and the individual
G.R. Nos. L-34069-70 February 28, 1973 members cited therein as respondents found guilty of the unfair labor
practice acts complained of, the latter will consequently lose their status as
B.F. GOODRICH PHILIPPINES, INC., petitioner, employees and will be disqualified to vote in a certification election that may
vs. be ordered by the Court. On the other hand, respondents-oppositors
B.F. GOODRICH (MARIKINA FACTORY) CONFIDENTIAL & SALARIED EMPLOYEES maintain that the pendency of said unfair labor practice case is not a bar to
UNION-NATU, B.F. GOODRICH (MAKATI OFFICE) CONFIDENTIAL & SALARIED the hearing of the instant cases, following the ruling of this Court in Case No.
EMPLOYEES UNION-NATU, and COURT OF INDUSTRIAL RELATIONS, 2536-MC entitled "In re: Petition for Certification Election at the Central
respondents. Textile Mills, Inc., Vicente Flores, et al." " 12 This was his ruling: "The motions
can not be granted. Individual respondents in the ULP case are still
Manuel O. Chan for petitioner. employees and possessed of the right to self-organization. Included therein is
their choice of a bargaining representative (Secs. 2 [d], 3 & 12, R. A. 875). To
Domingo E. de Lara and Associates for respondents. hold the certification proceedings in abeyance until final judgment of the ULP
case will be a denial of the aforesaid statutory right, the employees being left
without a collective bargaining representative." 13 The dispositive portion
FERNANDO, J.: was to deny the motions for lack of merit. There was a motion for
reconsideration, but such motion did not prosper. It was denied on August
The specific question raised impressed with an aspect of novelty, sustained 31, 1971. 14
with vigor and plausibility, persuaded this Court that the petition was worth
looning into. It is whether the determination of an unfair labor practice case, These certiorari proceedings were then filed with this Court, with petitioners
brought against respondent-unions, must precede the holding of a maintaining through copious references to National Labor Relations Board
certification election. A negative response came from respondent Court of cases that, with the declaration of what it considered to be an illegal strike
Industrial Relations, through Judge Ansberto Paredes. His order, affirmed by resulting in an unfair labor practice case, the status as employees of members
respondent Court en banc, is sought to be nullified in this certiorari of the two respondent Labor Unions would be placed in doubt and thus
proceeding. The answer filed on behalf of respondent-unions would sustain should be determined before the certification election. This Court, in a
its validity. What is more, it called attention to what is characterized as a resolution of November 10, 1971, required private respondents to file an
consistent pattern of anti-union practices on the part of petitioner intended answer. There is, on the whole, an admission of the allegations of the
to defeat the rights of labor to collective bargaining. A careful study of the petition. In addition, the following special and affirmative defenses were
specific legal issue posed, namely, whether the existence of an unfair labor interposed: "That up to the present, the strike of the respondent unions is
practice case against a labor organization, consisting of an illegal strike, would still on, thus the striking employees cannot be considered to have
suffice to call for the postponement of a proposed certification election, abandoned, quit, or otherwise terminated their employment relationship
incidentally started at the instance of petitioner itself, yields the same with the petitioner company, on the basis of the doctrine that a strike does
conclusion reached by respondent Court. The objectives of the Industrial not serve to sever the employer-employee relationship; ... That the
Peace Act1 would be sooner attained if, at the earliest opportunity, the respondent unions were virtually coerced by the petitioner company's
employees, all of them of an appropriate collective bargaining unit, be polled blatant resort to all kinds of union-busting tactics, topped by the technical
to determine which labor organization should be its exclusive representative. refusal to recognize and bargain with the respondent unions through the
Moreover, the discretion on the matter vested in respondent Court is rarely neat trick of filing a baseless petition for certification election and
interfered with. We dismiss the petition. questioning therein the right of over 90% of the unions' membership to join
the unions; ... That the members of the respondent unions are still
It was shown in the petition that on February 27, 1971, one Rodolfo Pajaro, employees of the petitioner company and as such are qualified to vote in any
as President of B.F. Goodrich (Makati Office) Confidential and Salaried certification election that the Court of Industrial Relations may direct to be
Employees Union-NATU, sent a letter to the petitioner, seeking recognition as held on the petitioner company's own petition, pursuant to Section 2(d) of
the bargaining agent of such employees so that thereafter there could be Republic Act 875, ... ." 15 They sought the dismissal of these certiorari
negotiations for a collective contract.2 Similarly, on the same date, one Pablo proceedings for lack of merit. Subsequently, memoranda were filed by the
C. Fulgar, as President of B.F. Goodrich (Marikina Factory) Confidential and parties, and the case was deemed submitted on February 14, 1972.
Salaried Employees Union-NATU and one Marcelino Lontok, Jr., representing
himself as Vice-President, NATU, sent a letter to the petitioner, of a similar As made clear at the outset, petitioner has not made out a case for the
tenor.3 Petitioner, as employer, countered by filing on March 6, 1971, two reversal of the challenged order of Judge Ansberto Paredes.
petitions for certification election with respondent Court of Industrial
Relations.4 Then came on March 10, 1971, two strike notices from 1. There is novelty in the specific question raised, as to whether or not a
respondents, filed with the Bureau of Labor Relations, demanding union certification election may be stayed at the instance of the employer, pending
recognition.5 It was not until April 13, 1971, that respondent Court the determination of an unfair labor practice case filed by it against certain
commenced the hearings of the petitions for certification election.6 It was employees affiliated with respondent-unions. That is a matter of which this
then alleged that on two days in April 19 and 20, 1971, there was a strike Court has not had an opportunity to speak on previously. What is settled law,
staged by those affiliated with private respondents, to force recognition of dating from the case of Standard Cigarette Workers' Union v. Court of
their unions.7 Subsequently, after preliminary investigation first had, on a Industrial Relations, 16 decided in 1957, is that if it were a labor organization
objecting to the participation in a certification election of a company- no unwarranted reduction in the number of those taking part in a
dominated union, as a result of which a complaint for an unfair labor practice certification election, even under the guise that in the meanwhile, which may
case against the employer was filed, the status of the latter union must be take some time, some of those who are employees could possibly lose such
first cleared in such a proceeding before such voting could take place. In the status, by virtue of a pending unfair labor practice case.
language of Justice J.B.L. Reyes as ponente: "As correctly pointed out by
Judge Lanting in his dissenting opinion on the denial of petitioner's motion 3. Nor would any useful purpose be served by such a postponement of the
for reconsideration, a complaint for unfair labor practice may be considered a holding of a certification election until after the determination of the unfair
prejudicial question in a proceeding for certification election when it is labor practice case filed. The time that might elapse is hard to predict, as the
charged therein that one or more labor unions participating in the election matter may eventually reach this Tribunal. In the meanwhile, there is no
are being aided, or are controlled, by the company or employer. The reason is opportunity for free choice on the part of the employees as to which labor
that the certification election may lead to the selection of an employer- organization shall be their exclusive bargaining representative. The force of
dominated or company union as the employees' bargaining representative, such an objection could be blunted if after a final decision to the effect that
and when the court finds that said union is employer-dominated in the unfair the employees complained of were engaged in illegal strike, they would
labor practice case, the union selected would be decertified and the whole automatically lose their jobs. Such is not the law, however. 21 It does not
election proceedings would be rendered useless and nugatory." 17 The next necessarily follow that whoever might have participated in a strike thus
year, the same jurist had occasion to reiterate such a doctrine in Manila proscribed has thereby forfeited the right to employment. What will be
Paper Mills Employees and Workers Association v. Court of Industrial gained then by holding in abeyance the certification election? There is no
Relations, 18 thus: "We agree with the CIR on the reasons given in its order certitude that the final decision arrived at in the pending unfair labor practice
that only a formal charge of company domination may serve as a bar to and case would sustain the claim of petitioner. Even if success would attend such
stop a certification election, the reason being that if there is a union endeavor, it cannot be plausibly asserted that its employees adjudged as
dominated by the Company, to which some of the workers belong, an having been engaged in such illegal strike are ipso facto deprived of such
election among the workers and employees of the company would not reflect status. There is thus an aspect of futility about the whole thing. Why should
the true sentiment and wishes of the said workers and employees from the not respondent Court then decide as it did?
standpoint of their welfare and interest, because as to the members of the
company dominated union, the vote of the said members in the election 4. This Court, moreover, is led to sustain the challenged order by another
would not be free. It is equally true, however, that the opposition to the consideration. In General Maritime Stevedores' Union v. South Sea Shipping
holding of a certification election due to a charge of company domination can Line, 22 a 1960 decision, Justice Labrador, speaking for this Court, stated that
only be filed and maintained by the labor organization which made the the question of whether or not a certification election shall be held "may well
charge of company domination, because it is the entity that stands to lose be left to the sound discretion of the Court of Industrial Relations,
and suffer prejudice by the certification election, the reason being that its considering the conditions involved in the case, ... ." 23 This Court has since
members might be overwhelmed in the voting by the other members then been committed to such a doctrine. 24 As a matter of fact, the only
controlled and dominated by the Company," 19 It is easily understandable American Supreme Court decision cited in the petition, National Labor
why it should be thus. There would be an impairment of the integrity of the Relations Board v. A.J. Tower Co., 25 likewise, sustains the same principle. It
collective bargaining process if a company-dominated union were allowed to was there held that the discretion of the labor tribunal, in this case, the
participate in a certification election. The timid, the timorous and the faint- National Labor Relations Board of the United States, is not lightly to be
hearted in the ranks of labor could easily be tempted to cast their votes in interfered with. The issue in that case, as noted in the opinion of Justice
favor of the choice of management. Should it emerge victorious, and it Murphy, equally noted for his labor law decisions, as well as his civil
becomes the exclusive representative of labor at the conference table, there libertarian views, "concerns the procedure used in elections under the
is a frustration of the statutory scheme. It takes two to bargain. There would National Labor Relations Act in which employees choose a statutory
be instead a unilateral imposition by the employer. There is need therefore to representative for purposes of collective bargaining. Specifically, we must
inquire as to whether a labor organization that aspires to be the exclusive determine the propriety of the National Labor Relations Board's refusal to
bargaining representative is company-dominated before the certification accept an employers post-election challenge to the eligibility of a voter who
election. participated in a consent election." 26 His opinion then went on to state that
the First Circuit Court of Appeals set aside the Board's order. The matter was
2. The unique situation before us, however, it exactly the reverse. It is then taken to the United States Supreme Court on certiorari. In reversing the
management that would have an unfair labor practice case filed by it for Circuit Court of Appeals, Justice Murphy made clear the acceptance of such a
illegal strike engaged in by some of its employees concluded, before it would doctrine in the light of the National Labor Relations Act thus: "As we have
agree to the holding of a certification election. That is the stand of petitioner. noted before, Congress has entrusted the Board with a wide degree of
It does not carry conviction. The reason that justifies the postponement of a discretion in establishing the procedure and safeguards necessary to insure
certification election pending an inquiry, as to the bona fides of a labor union, the fair and free choice of bargaining representatives by employees." 27
precisely calls for a different conclusion. If under the circumstances disclosed, Hence, this ruling of American Supreme Court: "It follows that the court
management is allowed to have its way, the result might be to dilute or fritter below erred in refusing to enforce the Board's order in full." 28 In the United
away the strength of an organization bent on a more zealous defense of States as in the Philippines, the decision in such matters by the administrative
labor's prerogatives. The difficulties and obstacles that must be then hurdled agency is accorded the utmost respect. Relevant is this affirmation by the
would not be lost on the rest of the personnel, who had not as yet made up then Justice, now Chief Justice, Concepcion that in such proceedings, the
their minds one way or the other. This is not to say that management is to be determination of what is an appropriate bargaining unit is "entitled to almost
precluded from filing an unfair labor practice case. It is merely to stress that complete finality." 29 The prevailing principle then on questions as to
such a suit should not be allowed to lend itself as a means, whether intended certification, as well as in other labor cases, is that only where there is a
or not, to prevent a truly free expression of the will of the labor group as to showing of clear abuse of discretion would this Tribunal be warranted in
the organization that will represent it. It is not only the loss of time involved, reversing the actuation of respondent
in itself not likely to enhance the prospect of respondent-unions, but also the Court. 30 There is no showing of such a failing in this case.
fear engendered in the mind of an ordinary employee that management has
many weapons in its arsenal to bring the full force of its undeniable power WHEREFORE, the petition for certiorari is dismissed. With costs against
against those of its employees dissatisfied with things as they are. There is no petitioner.
valid reason then for the postponement sought. This is one instance that calls
for the application of the maxim, lex dilationes semper exhorret. Moreover, is Concepcion, C.J., Makalintal, Zaldivar, Castro, Teehankee, Barredo, Makasiar,
there not in the posture taken by petitioner a contravention of what is Antonio and Esguerra, JJ., concur.
expressly set forth in the Industrial Peace Act, which speaks of the labor
organizations "designated or selected for the purpose of collective bargaining G.R. No. L-21278 December 27, 1966
by the majority of the employees in an appropriate collective bargaining unit
[be the exclusive] representative of all the employees in such unit for the FEATI UNIVERSITY, petitioner,
purpose of collective bargaining." 20 The law clearly contemplates all the vs.
employees, not only some of them. As much as possible then, there is to be
HON. JOSE S. BAUTISTA, Presiding Judge of the Court of Industrial Relations dated April 6, 1963 in Case No. 1183-MC, and the order dated April 29, 1963
and FEATI UNIVERSITY FACULTY CLUB-PAFLU, respondents. in Case No. V-30, all be annulled; and (4) that the respondent Judge be
ordered to dismiss said cases Nos. 41-IPA, 1183-MC and V-30 of the CIR.
----------------------------------------
On May 10, 1963, this Court issued a writ of preliminary injunction, upon the
G.R. No. L-21462 December 27, 1966 University's filing a bond of P1,000.00, ordering respondent Judge Jose S.
Bautista as Presiding Judge of the CIR, until further order from this Court, "to
FEATI UNIVERSITY, petitioner-appellant, desist and refrain from further proceeding in the premises (Cases Nos. 41-
vs. IPA, 1183-MC and V-30 of the Court of Industrial Relations)."1 On December
FEATI UNIVERSITY FACULTY CLUB-PAFLU, respondent-appellee. 4, 1963, this Court ordered the injunction bond increased to P100,000.00;
but on January 23, 1964, upon a motion for reconsideration by the University,
---------------------------------------- this Court reduced the bond to P50,000.00.

G.R. No. L-21500 December 27, 1966 A brief statement of the three cases — CIR Cases 41-IPA, 1183-MC and V-30
— involved in the Case G.R. No. L-21278, is here necessary.
FEATI UNIVERSITY, petitioner-appellant,
vs. CIR Case No. 41-IPA, relates to the case in connection with the strike staged
FEATI UNIVERSITY FACULTY CLUB-PAFLU, respondent-appellee. by the members of the Faculty Club. As we have stated, the dispute between
the University and the Faculty Club was certified on March 21, 1963 by the
Rafael Dinglasan for petitioner. President of the Philippines to the CIR. On the strength of the presidential
Cipriano Cid and Associates for respondents. certification, respondent Judge Bautista set the case for hearing on March 23,
1963. During the hearing, the Judge endeavored to reconcile the part and it
ZALDIVAR, J.: was agreed upon that the striking faculty members would return to work and
the University would readmit them under a status quo arrangement. On that
This Court, by resolution, ordered that these three cases be considered very same day, however, the University, thru counsel filed a motion to dismiss
together, and the parties were allowed to file only one brief for the three the case upon the ground that the CIR has no jurisdiction over the case,
cases. because (1) the Industrial Peace Act is not applicable to the University, it
being an educational institution, nor to the members of the Faculty Club,
On January 14, 1963, the President of the respondent Feati University Faculty they being independent contractors; and (2) the presidential certification is
Club-PAFLU — hereinafter referred to as Faculty Club — wrote a letter to Mrs. violative of Section 10 of the Industrial Peace Act, as the University is not an
Victoria L. Araneta, President of petitioner Feati University — hereinafter industrial establishment and there was no industrial dispute which could be
referred to as University — informing her of the organization of the Faculty certified to the CIR. On March 30, 1963 the respondent Judge issued an order
Club into a registered labor union. The Faculty Club is composed of members denying the motion to dismiss and declaring that the Industrial Peace Act is
who are professors and/or instructors of the University. On January 22, 1963, applicable to both parties in the case and that the CIR had acquired
the President of the Faculty Club sent another letter containing twenty-six jurisdiction over the case by virtue of the presidential certification. In the
demands that have connection with the employment of the members of the same order, the respondent Judge, believing that the dispute could not be
Faculty Club by the University, and requesting an answer within ten days from decided promptly, ordered the strikers to return immediately to work and the
receipt thereof. The President of the University answered the two letters, University to take them back under the last terms and conditions existing
requesting that she be given at least thirty days to study thoroughly the before the dispute arose, as per agreement had during the hearing on March
different phases of the demands. Meanwhile counsel for the University, to 23, 1963; and likewise enjoined the University, pending adjudication of the
whom the demands were referred, wrote a letter to the President of the case, from dismissing any employee or laborer without previous
Faculty Club demanding proof of its majority status and designation as a authorization from the CIR. The University filed on April 1, 1963 a motion for
bargaining representative. On February 1, 1963, the President of the Faculty reconsideration of the order of March 30, 1963 by the CIR en banc, and at the
Club again wrote the President of the University rejecting the latter's request same time asking that the motion for reconsideration be first heard by the
for extension of time, and on the same day he filed a notice of strike with the CIR en banc. Without the motion for reconsideration having been acted upon
Bureau of Labor alleging as reason therefor the refusal of the University to by the CIR en banc, respondent Judge set the case for hearing on the merits
bargain collectively. The parties were called to conferences at the Conciliation for May 8, 1963. The University moved for the cancellation of said hearing
Division of the Bureau of Labor but efforts to conciliate them failed. On upon the ground that the court en banc should first hear the motion for
February 18, 1963, the members of the Faculty Club declared a strike and reconsideration and resolve the issues raised therein before the case is heard
established picket lines in the premises of the University, resulting in the on the merits. This motion for cancellation of the hearing was denied. The
disruption of classes in the University. Despite further efforts of the officials respondent Judge, however, cancelled the scheduled hearing when counsel
from the Department of Labor to effect a settlement of the differences for the University manifested that he would take up before the Supreme
between the management of the University and the striking faculty members Court, by a petition for certiorari, the matter regarding the actuations of the
no satisfactory agreement was arrived at. On March 21, 1963, the President respondent Judge and the issues raised in the motion for reconsideration,
of the Philippines certified to the Court of Industrial Relations the dispute specially the issue relating to the jurisdiction of the CIR. The order of March
between the management of the University and the Faculty Club pursuant to 30, 1963 in Case 41-IPA is one of the orders sought to be annulled in the case,
the provisions of Section 10 of Republic Act No. 875. G.R. No. L-21278.

In connection with the dispute between the University and the Faculty Club Before the above-mentioned order of March 30, 1963 was issued by
and certain incidents related to said dispute, various cases were filed with the respondent Judge, the University had employed professors and/or instructors
Court of Industrial Relations — hereinafter referred to as CIR. The three cases to take the places of those professors and/or instructors who had struck. On
now before this Court stemmed from those cases that were filed with the April 1, 1963, the Faculty Club filed with the CIR in Case 41-IPA a petition to
CIR. declare in contempt of court certain parties, alleging that the University
refused to accept back to work the returning strikers, in violation of the
CASE NO. G.R. NO. L-21278 return-to-work order of March 30, 1963. The University filed, on April 5,1963,
its opposition to the petition for contempt, denying the allegations of the
On May 10, 1963, the University filed before this Court a "petition for Faculty Club and alleging by way of special defense that there was still the
certiorari and prohibition with writ of preliminary injunction", docketed as motion for reconsideration of the order of March 30, 1963 which had not yet
G.R. No. L-21278, praying: (1) for the issuance of the writ of preliminary been acted upon by the CIR en banc. On April 6, 1963, the respondent Judge
injunction enjoining respondent Judge Jose S. Bautista of the CIR to desist issued an order stating that "said replacements are hereby warned and
from proceeding in CIR Cases Nos. 41-IPA, 1183-MC, and V-30; (2) that the cautioned, for the time being, not to disturb nor in any manner commit any
proceedings in Cases Nos. 41-IPA and 1183-MC be annulled; (3) that the act tending to disrupt the effectivity of the order of March 30,1963, pending
orders dated March 30, 1963 and April 6, 1963 in Case No. 41-IPA, the order the final resolution of the same."2 On April 8, 1963, there placing professors
and/or instructors concerned filed, thru counsel, a motion for reconsideration union, so that the Court of Industrial Relations had jurisdiction to take
by the CIR en banc of the order of respondent Judge of April 6, 1963. This cognizance of Cases Nos. 1183-MC and V-30 and to issue the questioned
order of April 6, 1963 is one of the orders that are sought to be annulled in orders in those two cases; and (3) that the petition for certiorari and
case G.R. No. L-21278. prohibition with preliminary injunction was prematurely filed because the
orders of the CIR sought to be annulled were still the subjects of pending
CIR Case No. 1183-MC relates to a petition for certification election filed by motions for reconsideration before the CIR en banc when said petition for
the Faculty Club on March 8, 1963 before the CIR, praying that it be certified certiorari and prohibition with preliminary injunction was filed before this
as the sole and exclusive bargaining representative of all the employees of Court.
the University. The University filed an opposition to the petition for
certification election and at the same time a motion to dismiss said petition, CASE G.R. NO. L-21462
raising the very same issues raised in Case No. 41-IPA, claiming that the
petition did not comply with the rules promulgated by the CIR; that the This case, G.R. No. L-21462, involves also CIR Case No. 1183-MC. As already
Faculty Club is not a legitimate labor union; that the members of the Faculty stated Case No. 1183-MC relates to a petition for certification election filed
Club cannot unionize for collective bargaining purposes; that the terms of the by the Faculty Club as a labor union, praying that it be certified as the sole
individual contracts of the professors, instructors, and teachers, who are and exclusive bargaining representative of all employees of the University.
members of the Faculty Club, would expire on March 25 or 31, 1963; and that This petition was opposed by the University, and at the same time it filed a
the CIR has no jurisdiction to take cognizance of the petition because the motion to dismiss said petition. But before Judge Baltazar Villanueva could
Industrial Peace Act is not applicable to the members of the Faculty Club nor act on the petition for certification election and the motion to dismiss the
to the University. This case was assigned to Judge Baltazar Villanueva of the same, Faculty Club filed a motion to withdraw said petition upon the ground
CIR. Before Judge Villanueva could act on the motion to dismiss, however, the that the issue raised in Case No. 1183-MC were absorbed by Case No. 41-IPA
Faculty Club filed on April 3, 1963 a motion to withdraw the petition on the which was certified by the President of the Philippines. Judge Baltazar
ground that the labor dispute (Case No. 41-IPA) had already been certified by Villanueva, by order April 6, 1963, granted the motion to withdraw. The
the President to the CIR and the issues raised in Case No. 1183-MC were University filed a motion for reconsideration of that order of April 6, 1963 by
absorbed by Case No. 41-IPA. The University opposed the withdrawal, the CIR en banc. That motion for reconsideration was pending action by the
alleging that the issues raised in Case No. 1183-MC were separate and CIR en banc when the petition for certiorari and prohibition with preliminary
distinct from the issues raised in Case No. 41-IPA; that the questions of injunction in Case G.R. no. L-21278 was filed on May 10, 1963. As earlier
recognition and majority status in Case No. 1183-MC were not absorbed by stated this Court, in Case G.R. No. L-21278, issued a writ of preliminary
Case No. 41-IPA; and that the CIR could not exercise its power of compulsory injunction on May 10, 1963, ordering respondent Judge Bautista, until further
arbitration unless the legal issue regarding the existence of employer- order from this Court, to desist and refrain from further proceeding in the
employee relationship was first resolved. The University prayed that the premises (Cases Nos. 41-IPA, 1183-MC and V-30 of the Court of Industrial
motion of the Faculty Club to withdraw the petition for certification election Relations).
be denied, and that its motion to dismiss the petition be heard. Judge
Baltazar Villanueva, finding that the reasons stated by the Faculty Club in the On June 5, 1963, that is, after this Court has issued the writ of preliminary
motion to withdraw were well taken, on April 6, 1963, issued an order injunction in Case G.R. No. L-21278, the CIR en banc issued a resolution
granting the withdrawal. The University filed, on April 24, 1963, a motion for denying the motion for reconsideration of the order of April 6, 1963 in Case
reconsideration of that order of April 6, 1963 by the CIR en banc. This order No. 1183-MC.
of April 6, 1963 in Case No. 1183-MC is one of the orders sought to be
annulled in the case, G.R. No. L-21278, now before Us. On July 8, 1963, the University filed before this Court a petition for certiorari,
by way of an appeal from the resolution of the CIR en banc, dated June 5,
CIR Case No. V-30 relates to a complaint for indirect contempt of court filed 1963, denying the motion for reconsideration of the order of April 6, 1963 in
against the administrative officials of the University. The Faculty Club, Case No. 1183-MC. This petition was docketed as G.R. No. L-21462. In its
through the Acting Chief Prosecutor of the CIR, filed with the CIR a complaint petition for certiorari, the University alleges (1) that the resolution of the
docketed as Case No. V-30, charging President Victoria L. Araneta, Dean Court of Industrial Relations of June 5, 1963 was null and void because it was
Daniel Salcedo, Executive Vice-President Rodolfo Maslog, and Assistant to the issued in violation of the writ of preliminary injunction issued in Case G.R. No.
President Jose Segovia, as officials of the University, with indirect contempt of L-21278; (2) that the issues of employer-employee relationship, the alleged
court, reiterating the same charges filed in Case No. 41-IPA for alleged status as a labor union, majority representation and designation as bargaining
violation of the order dated March 30, 1963. Based on the complaint thus representative in an appropriate unit of the Faculty Club should have been
filed by the Acting Chief Prosecutor of the CIR, respondent Judge Bautista resolved first in Case No. 1183-MC prior to the determination of the issues in
issued on April 29, 1963 an order commanding any officer of the law to arrest Case No. 41-IPA and therefore the motion to withdraw the petition for
the above named officials of the University so that they may be dealt with in certification election should not have been granted upon the ground that the
accordance with law, and the same time fixed the bond for their release at issues in the first case have been absorbed in the second case; and (3) the
P500.00 each. This order of April 29, 1963 is also one of the orders sought to lower court acted without or in excess of jurisdiction in taking cognizance of
be annulled in the case, G.R. No. L-2l278. the petition for certification election and that the same should have been
dismissed instead of having been ordered withdrawn. The University prayed
The principal allegation of the University in its petition for certiorari and that the proceedings in Case No. 1183-MC and the order of April 6, 1963 and
prohibition with preliminary injunction in Case G.R. No. L-21278, now before the resolution of June 5, 1963 issued therein be annulled, and that the CIR be
Us, is that respondent Judge Jose S. Bautista acted without, or in excess of, ordered to dismiss Case No. 1183-MC on the ground of lack of jurisdiction.
jurisdiction, or with grave abuse of discretion, in taking cognizance of, and in
issuing the questioned orders in, CIR Cases Nos. 41-IPA 1183-MC and V-30. The Faculty Club filed its answer, admitting some, and denying other,
Let it be noted that when the petition for certiorari and prohibition with allegations in the petition for certiorari; and specially alleging that the lower
preliminary injunction was filed on May 10, 1963 in this case, the questioned court's order granting the withdrawal of the petition for certification election
order in CIR Cases Nos. 41-IPA, 1183-MC and V-30 were still pending action was in accordance with law, and that the resolution of the court en banc on
by the CIR en banc upon motions for reconsideration filed by the University. June 5, 1963 was not a violation of the writ of preliminary injunction issued in
Case G.R. No. L-21278 because said writ of injunction was issued against
On June 10, 1963, the Faculty Club filed its answer to the petition for Judge Jose S. Bautista and not against the Court of Industrial Relations, much
certiorari and prohibition with preliminary injunction, admitting some less against Judge Baltazar Villanueva who was the trial judge of Case No.
allegations contained in the petition and denying others, and alleging special 1183-MC.
defenses which boil down to the contentions that (1) the CIR had acquired
jurisdiction to take cognizance of Case No. 41-IPA by virtue of the presidential CASE G.R. NO. L-21500
certification, so that it had jurisdiction to issue the questioned orders in said
Case No. 41-IPA; (2) that the Industrial Peace Act (Republic Act 875) is This case, G.R. No. L-21500, involves also CIR Case No. 41-IPA. As earlier
applicable to the University as an employer and to the members of the stated, Case No. 41-IPA relates to the strike staged by the members of the
Faculty Club as employees who are affiliated with a duly registered labor Faculty Club and the dispute was certified by the President of the Philippines
to the CIR. The University filed a motion to dismiss that case upon the ground the Faculty Club because the latter are independent contractors and,
that the CIR has no jurisdiction over the case, and on March 30, 1963 Judge therefore, not employees within the purview of the said Act.
Jose S. Bautista issued an order denying the motion to dismiss and declaring
that the Industrial Peace Act is applicable to both parties in the case and that In support of the contention that being an educational institution it is beyond
the CIR had acquired jurisdiction over the case by virtue of the presidential the scope of Republic Act No. 875, the University cites cases decided by this
certification; and in that same order Judge Bautista ordered the strikers to Court: Boy Scouts of the Philippines vs. Juliana Araos, L-10091, Jan. 29, 1958;
return to work and the University to take them back under the last terms and University of San Agustin vs. CIR, et al., L-12222, May 28, 1958; Cebu Chinese
conditions existing before the dispute arose; and enjoined the University High School vs. Philippine Land-Air-Sea Labor Union, PLASLU, L-12015, April
from dismissing any employee or laborer without previous authority from the 22, 1959; La Consolacion College, et al. vs. CIR, et al., L-13282, April 22, 1960;
court. On April 1, 1963, the University filed a motion for reconsideration of University of the Philippines, et al. vs. CIR, et al., L-15416, April 8, 1960; Far
the order of March 30, 1963 by the CIR en banc. That motion for Eastern University vs. CIR, L-17620, August 31, 1962. We have reviewed these
reconsideration was pending action by the CIR en banc when the petition for cases, and also related cases subsequent thereto, and We find that they do
certiorari and prohibition with preliminary injunction in Case G.R. No. L- not sustain the contention of the University. It is true that this Court has ruled
21278 was filed on May 10, 1963. As we have already stated, this Court in that certain educational institutions, like the University of Santo Tomas,
said case G.R. No. L-21278, issued a writ of preliminary injunction on May 10, University of San Agustin, La Consolacion College, and other juridical entities,
1963 ordering respondent Judge Jose S. Bautista, until further order from this like the Boy Scouts of the Philippines and Manila Sanitarium, are beyond the
Court, to desist and refrain from further proceeding in the premises (Cases purview of Republic Act No. 875 in the sense that the Court of Industrial
Nos. 41-IPA, 1183-MC and V-30 of the Court of Industrial Relations). Relations has no jurisdiction to take cognizance of charges of unfair labor
practice filed against them, but it is nonetheless true that the principal
On July 2, 1963, the University received a copy of the resolution of the CIR en reason of this Court in ruling in those cases that those institutions are
banc, dated May 7, 1963 but actually received and stamped at the Office of excluded from the operation of Republic Act 875 is that those entities are not
the Clerk of the CIR on June 28, 1963, denying the motion for reconsideration organized, maintained and operated for profit and do not declare dividends
of the order dated March 30, 1963 in Case No. 41-IPA. to stockholders. The decision in the case of University of San Agustin vs.
Court of Industrial Relations, G.R. No. L-12222, May 28, 1958, is very
On July 23, 1963, the University filed before this Court a petition for pertinent. We quote a portion of the decision:
certiorari, by way of an appeal from the resolution of the Court of Industrial
Relations en banc dated May 7, 1963 (but actually received by said petitioner It appears that the University of San Agustin, petitioner herein, is an
on July 2, 1963) denying the motion for reconsideration of the order of March educational institution conducted and managed by a "religious non-stock
30, 1963 in Case No. 41-IPA. This petition was docketed as G.R. No. L-21500. corporation duly organized and existing under the laws of the Philippines." It
In its petition for certiorari the University alleges (1) that the resolution of the was organized not for profit or gain or division of the dividends among its
CIR en banc, dated May 7, 1963 but filed with the Clerk of the CIR on June 28, stockholders, but solely for religious and educational purposes. It likewise
1963, in Case No. 41-IPA, is null and void because it was issued in violation of appears that the Philippine Association of College and University Professors,
the writ of preliminary injunction issued by this Court in G.R. No. L-21278; (2) respondent herein, is a non-stock association composed of professors and
that the CIR, through its Presiding Judge, had no jurisdiction to take teachers in different colleges and universities and that since its organization
cognizance of Case No. 41-IPA and the order of March 30, 1963 and the two years ago, the university has adopted a hostile attitude to its formation
resolution dated May 7, 1963 issued therein are null and void; (3) that the and has tried to discriminate, harass and intimidate its members for which
certification made by the President of the Philippines is not authorized by reason the association and the members affected filed the unfair labor
Section 10 of Republic Act 875, but is violative thereof; (4) that the Faculty practice complaint which initiated this proceeding. To the complaint of unfair
Club has no right to unionize or organize as a labor union for collective labor practice, petitioner filed an answer wherein it disputed the jurisdiction
bargaining purposes and to be certified as a collective bargaining agent of the Court of Industrial Relations over the controversy on the following
within the purview of the Industrial Peace Act, and consequently it has no grounds:
right to strike and picket on the ground of petitioner's alleged refusal to
bargain collectively where such duty does not exist in law and is not "(a) That complainants therein being college and/or university professors
enforceable against an educational institution; and (5) that the return-to- were not "industrial" laborers or employees, and the Philippine Association
work order of March 30, 1963 is improper and illegal. The petition prayed of College and University Professors being composed of persons engaged in
that the proceedings in Case No. 41-IPA be annulled, that the order dated the teaching profession, is not and cannot be a legitimate labor organization
March 30, 1963 and the resolution dated May 7, 1963 be revoked, and that within the meaning of the laws creating the Court of Industrial Relations and
the lower court be ordered to dismiss Case 41-IPA on the ground of lack of defining its powers and functions;
jurisdiction.
"(b) That the University of San Agustin, respondent therein, is not an
On September 10, 1963, the Faculty Club, through counsel, filed a motion to institution established for the purpose of gain or division of profits, and
dismiss the petition for certiorari on the ground that the petition being filed consequently, it is not an "industrial" enterprise and the members of its
by way of an appeal from the orders of the Court of Industrial Relations teaching staff are not engaged in "industrial" employment (U.S.T. Hospital
denying the motion to dismiss in Case No. 41-IPA, the petition for certiorari is Employees Association vs. Sto. Tomas University Hospital, G.R. No. L-6988, 24
not proper because the orders appealed from are interlocutory in nature. May 1954; and San Beda College vs. Court of Industrial Relations and National
Labor Union, G.R. No. L-7649, 29 October 1955; 51 O.G. (Nov. 1955) 5636-
This Court, by resolution of September 26, 1963, ordered that these three 5640);
cases (G.R. Nos. L-21278, L-21462 and L-21500) be considered together and
the motion to dismiss in Case G.R. No. L-21500 be taken up when the cases "(c) That, as a necessary consequence, alleged controversy between therein
are decided on the merits after the hearing. complainants and respondent is not an "industrial" dispute, and the Court of
Industrial Relations has no jurisdiction, not only on the parties but also over
Brushing aside certain technical questions raised by the parties in their the subject matter of the complaint."
pleadings, We proceed to decide these three cases on the merits of the
issues raised. The issue now before us is: Since the University of San Agustin is not an
institution established for profit or gain, nor an industrial enterprise, but one
The University has raised several issues in the present cases, the pivotal one established exclusively for educational purposes, can it be said that its
being its claim that the Court of Industrial Relations has no jurisdiction over relation with its professors is one of employer and employee that comes
the parties and the subject matter in CIR Cases 41-IPA, 1183-MC and V-30, under the jurisdiction of the Court of Industrial Relations? In other words, do
brought before it, upon the ground that Republic Act No. 875 is not the provisions of the Magna Carta on unfair labor practice apply to the
applicable to the University because it is an educational institution and not an relation between petitioner and members of respondent association?
industrial establishment and hence not an "employer" in contemplation of
said Act; and neither is Republic Act No. 875 applicable to the members of The issue is not new. Thus, in the case of Boy Scouts of the Philippines v.
Juliana V. Araos, G.R. No. L-10091, promulgated on January 29, 1958, this
Court, speaking thru Mr. Justice Montemayor, answered the query in the not a business enterprise but an educational institution not organized for
negative in the following wise: profit.

"The main issue involved in the present case is whether or not a charitable If the claim that petitioner is an educational institution not operated for
institution or one organized not for profit but for more elevated purposes, profit is true, which apparently is the case, because the very court a quo
charitable, humanitarian, etc., like the Boy Scouts of the Philippines, is found that it has no stockholder, nor capital . . . then we are of the opinion
included in the definition of "employer" contained in Republic Act 875, and that the same does not come under the jurisdiction of the Court of Industrial
whether the employees of said institution fall under the definition of Relations in view of the ruling in the case of Boy Scouts of the Philippines v.
"employee" also contained in the same Republic Act. If they are included, Juliana V. Araos, G.R. No. L-10091, decided on January 29, 1958.
then any act which may be considered unfair labor practice, within the
meaning of said Republic Act, would come under the jurisdiction of the Court It is noteworthy that the cases of the University of San Agustin, the University
of Industrial Relations; but if they do not fall within the scope of said Republic of Santo Tomas, and La Consolacion College, cited above, all involve charges
Act, particularly, its definitions of employer and employee, then the Industrial of unfair labor practice under Republic Act No. 875, and the uniform rulings
Court would have no jurisdiction at all. of this Court are that the Court of Industrial Relations has no jurisdiction over
the charges because said Act does not apply to educational institutions that
xxx xxx xxx are not operated or maintained for profit and do not declare dividends. On
the other hand, in the cases of Far Eastern University v. CIR, et al., G.R. No. L-
"On the basis of the foregoing considerations, there is every reason to believe 17620, August 31, 1962, this Court upheld the decision of the Court of
that our labor legislation from Commonwealth Act No. 103, creating the Industrial Relations finding the Far Eastern University, also an educational
Court of Industrial Relations, down through the Eight-Hour Labor Law, to the institution, guilty of unfair labor practice. Among the findings of fact in said
Industrial Peace Act, was intended by the Legislature to apply only to case was that the Far Eastern University made profits from the school year
industrial employment and to govern the relations between employers 1952-1953 to 1958-1959. In affirming the decision of the lower court, this
engaged in industry and occupations for purposes of profit and gain, and Court had thereby ratified the ruling of the Court of Industrial Relations
their industrial employees, but not to organizations and entities which are which applied the Industrial Peace Act to educational institutions that are
organized, operated and maintained not for profit or gain, but for elevated organized, operated and maintained for profit.
and lofty purposes, such as, charity, social service, education and instruction,
hospital and medical service, the encouragement and promotion of character, It is also noteworthy that in the decisions in the cases of the Boy Scouts of
patriotism and kindred virtues in youth of the nation, etc. the Philippines, the University of San Agustin, the University of Sto. Tomas,
and La Consolacion College, this Court was not unanimous in the view that
"In conclusion, we find and hold that Republic Act No. 875, particularly, that the Industrial Peace Act (Republic Act No. 875) is not applicable to charitable,
portion thereof regarding labor disputes and unfair labor practice, does not eleemosynary or non-profit organizations — which include educational
apply to the Boy Scouts of the Philippines, and consequently, the Court of institutions not operated for profit. There are members of this Court who
Industrial Relations had no jurisdiction to entertain and decide the action or hold the view that the Industrial Peace Act would apply also to non-profit
petition filed by respondent Araos. Wherefore, the appealed decision and organizations or entities — the only exception being the Government,
resolution of the CIR are hereby set aside, with costs against respondent." including any political subdivision or instrumentality thereof, in so far as
governmental functions are concerned. However, in the Far Eastern
There being a close analogy between the relation and facts involved in the University case this Court is unanimous in supporting the view that an
two cases, we cannot but conclude that the Court of Industrial Relations has educational institution that is operated for profit comes within the scope of
no jurisdiction to entertain the complaint for unfair labor practice lodged by the Industrial Peace Act. We consider it a settled doctrine of this Court,
respondent association against petitioner and, therefore, we hereby set aside therefore, that the Industrial Peace Act is applicable to any organization or
the order and resolution subject to the present petition, with costs against entity — whatever may be its purpose when it was created — that is
respondent association. operated for profit or gain.

The same doctrine was confirmed in the case of University of Santo Tomas v. Does the University operate as an educational institution for profit? Does it
Hon. Baltazar Villanueva, et al., G.R. No. L-13748, October 30, 1959, where declare dividends for its stockholders? If it does not, it must be declared
this Court ruled that: beyond the purview of Republic Act No. 875; but if it does, Republic Act No.
875 must apply to it. The University itself admits that it has declared
In the present case, the record reveals that the petitioner University of Santo dividends.3 The CIR in its order dated March 30, 1963 in CIR Case No. 41-IPA
Tomas is not an industry organized for profit but an institution of learning — which order was issued after evidence was heard — also found that the
devoted exclusively to the education of the youth. The Court of First Instance University is not for strictly educational purposes and that "It realizes profits
of Manila in its decision in Civil Case No. 28870, which has long become final and parts of such earning is distributed as dividends to private stockholders
and consequently the settled law in the case, found as established by the or individuals (Exh. A and also 1 to 1-F, 2-x 3-x and 4-x)"4 Under this
evidence adduced by the parties therein (herein petitioner and respondent circumstance, and in consonance with the rulings in the decisions of this
labor union) that while the University collects fees from its students, all its Court, above cited, it is obvious that Republic Act No. 875 is applicable to
income is used for the improvement and enlargement of the institution. The herein petitioner Feati University.
University declares no dividend, and the members of the corporation who
founded it, as ordained in its articles of incorporation, receive no material But the University claims that it is not an employer within the contemplation
compensation for the time and sacrifice they render to the University and its of Republic Act No. 875, because it is not an industrial establishment. At
students. The respondent union itself in a case before the Industrial Court most, it says, it is only a lessee of the services of its professors and/or
(Case No. 314-MC) has averred that "the University of Santo Tomas, like the instructors pursuant to a contract of services entered into between them. We
San Beda College, is an educational institution operated not for profit but for find no merit in this claim. Let us clarify who is an "employer" under the Act.
the sole purpose of educating young men." (See Annex "B" to petitioner's Section 2(c) of said Act provides:
motion to dismiss.). It is apparent, therefore, that on the face of the record
the University of Santo Tomas is not a corporation created for profit but an Sec. 2. Definitions.—As used in this Act —
educational institution and therefore not an industrial or business
organization. (c) The term employer include any person acting in the interest of an
employer, directly or indirectly, but shall not include any labor organization
In the case of La Consolacion College, et al. vs. CIR, et al., G.R. No. L-13282, (otherwise than when acting as an employer) or any one acting in the
April 22, 1960, this Court repeated the same ruling when it said: capacity or agent of such labor organization.

The main issue in this appeal by petitioner is that the industry trial court It will be noted that in defining the term "employer" the Act uses the word
committed an error in holding that it has jurisdiction to act in this case even if "includes", which it also used in defining "employee". [Sec. 2 (d)], and
it involves unfair labor practice considering that the La Consolacion College is "representative" [Sec. 2(h)]; and not the word "means" which the Act uses in
defining the terms "court" [Sec. 2(a)], "labor organization" [Sec. 2(e)], University may be considered as a lessee of services under a contract
"legitimate labor organization [Sec. 2(f)], "company union" [Sec. 2(g)], "unfair between it and the members of its Faculty, still it is included in the term
labor practice" [Sec. 2(i)], "supervisor" [Sec. 2(k)], "strike" [Sec. 2(l)] and "employer". "Running through the word `employ' is the thought that there
"lock-out" [Sec. 2(m)]. A methodical variation in terminology is manifest. This has been an agreement on the part of one person to perform a certain
variation and distinction in terminology and phraseology cannot be presumed service in return for compensation to be paid by an employer. When you ask
to have been the inconsequential product of an oversight; rather, it must how a man is employed, or what is his employment, the thought that he is
have been the result of a deliberate and purposeful act, more so when we under agreement to perform some service or services for another is
consider that as legislative records show, Republic Act No. 875 had been predominant and paramount." (Ballentine Law Dictionary, Philippine ed., p.
meticulously and painstakingly drafted and deliberated upon. In using the 430, citing Pinkerton National Detective Agency v. Walker, 157 Ga. 548, 35 A.
word "includes" and not "means", Congress did not intend to give a complete L. R. 557, 560, 122 S.E. Rep. 202).
definition of "employer", but rather that such definition should be
complementary to what is commonly understood as employer. Congress To bolster its claim of exception from the application of Republic Act No. 875,
intended the term to be understood in a broad meaning because, firstly, the the University contends that it is not state that the employers included in the
statutory definition includes not only "a principal employer but also a person definition of 2 (c) of the Act. This contention can not be sustained. In the first
acting in the interest of the employer"; and, secondly, the Act itself place, Sec. 2 (c) of Republic Act No. 875 does not state that the employers
specifically enumerated those who are not included in the term "employer", included in the definition of the term "employer" are only and exclusively
namely: (1) a labor organization (otherwise than when acting as an "industrial establishments"; on the contrary, as stated above, the term
employer), (2) anyone acting in the capacity of officer or agent of such labor "employer" encompasses all employers except those specifically excluded by
organization [Sec. 2(c)], and (3) the Government and any political subdivision the Act. In the second place, even the Act itself does not refer exclusively to
or instrumentality thereof insofar as the right to strike for the purpose of industrial establishments and does not confine its application thereto. This is
securing changes or modifications in the terms and conditions of patent inasmuch as several provisions of the Act are applicable to non-
employment is concerned (Section 11). Among these statutory exemptions, industrial workers, such as Sec. 3, which deals with "employees' right to self-
educational institutions are not included; hence, they can be included in the organization"; Sections 4 and 5 which enumerate unfair labor practices;
term "employer". This Court, however, has ruled that those educational Section 8 which nullifies private contracts contravening employee's rights;
institutions that are not operated for profit are not within the purview of Section 9 which relates to injunctions in any case involving a labor dispute;
Republic Act No. 875.5 Section 11 which prohibits strikes in the government; Section 12 which
provides for the exclusive collective bargaining representation for labor
As stated above, Republic Act No. 875 does not give a comprehensive but organizations; Section 14 which deals with the procedure for collective
only a complementary definition of the term "employer". The term bargaining; Section 17 which treats of the rights and conditions of
encompasses those that are in ordinary parlance "employers." What is membership in labor organizations; Sections 18, 19, 20 and 21 which provide
commonly meant by "employer"? The term "employer" has been given respectively for the establishment of conciliation service, compilation of
several acceptations. The lexical definition is "one who employs; one who collective bargaining contracts, advisory labor-management relations; Section
uses; one who engages or keeps in service;" and "to employ" is "to provide 22 which empowers the Secretary of Labor to make a study of labor relations;
work and pay for; to engage one's service; to hire." (Webster's New and Section 24 which enumerates the rights of labor organizations. (See
Twentieth Century Dictionary, 2nd ed., 1960, p. 595). The Workmen's Dissenting Opinion of Justice Concepcion in Boy Scouts of the Philippines v.
Compensation Act defines employer as including "every person or association Juliana Araos, G.R. No. L-10091, January 29, 1958.)
of persons, incorporated or not, public or private, and the legal
representative of the deceased employer" and "includes the owner or lessee This Court, in the case of Boy Scouts of the Philippines v. Araos, supra, had
of a factory or establishment or place of work or any other person who is occasion to state that the Industrial Peace Act "refers only to organizations
virtually the owner or manager of the business carried on in the and entities created and operated for profits, engaged in a profitable trade,
establishment or place of work but who, for reason that there is an occupation or industry". It cannot be denied that running a university
independent contractor in the same, or for any other reason, is not the direct engages time and attention; that it is an occupation or a business from which
employer of laborers employed there." [Sec. 39(a) of Act No. 3428.] The the one engaged in it may derive profit or gain. The University is not an
Minimum Wage Law states that "employer includes any person acting directly industrial establishment in the sense that an industrial establishment is one
or indirectly in the interest of the employer in relation to an employee and that is engaged in manufacture or trade where raw materials are changed or
shall include the Government and the government corporations". [Rep. Act fashioned into finished products for use. But for the purposes of the
No. 602, Sec. 2(b)]. The Social Security Act defines employer as "any person, Industrial Peace Act the University is an industrial establishment because it is
natural or juridical, domestic or foreign, who carries in the Philippines any operated for profit and it employs persons who work to earn a living. The
trade, business, industry, undertaking, or activity of any kind and uses the term "industry", for the purposes of the application of our labor laws should
services of another person who is under his orders as regards the be given a broad meaning so as to cover all enterprises which are operated
employment, except the Government and any of its political subdivisions, for profit and which engage the services of persons who work to earn a living.
branches or instrumentalities, including corporations owned or controlled by
the Government." (Rep. Act No. 1161, Sec. 8[c]). The word "industry" within State Labor Relations Act controlling labor
relations in industry, cover labor conditions in any field of employment where
This Court, in the cases of the The Angat River Irrigation System, et al. vs. the objective is earning a livelihood on the one side and gaining of a profit on
Angat River Workers' Union (PLUM), et al., G.R. Nos. L-10934 and L-10944, the other. Labor Law Sec. 700 et seq. State Labor Relations Board vs.
December 28, 1957, which cases involve unfair labor practices and hence McChesney, 27 N.Y.S. 2d 866, 868." (Words and Phrases, Permanent Edition,
within the purview of Republic Act No. 875, defined the term employer as Vol. 21, 1960 edition p. 510).
follows:
The University urges that even if it were an employer, still there would be no
An employer is one who employs the services of others; one for whom employer-employee relationship between it and the striking members of the
employees work and who pays their wages or salaries (Black Law Dictionary, Faculty Club because the latter are not employees within the purview of Sec.
4th ed., p. 618). 2(d) of Republic Act No. 875 but are independent contractors. This claim is
untenable.
An employer includes any person acting in the interest of an employer,
directly or indirectly (Sec. 2-c, Rep. Act 875). Section 2 (d) of Republic Act No. 875 provides:

Under none of the above definitions may the University be excluded, (d) The term "employee" shall include any employee and shall not be
especially so if it is considered that every professor, instructor or teacher in limited to the employee of a particular employer unless the act explicitly
the teaching staff of the University, as per allegation of the University itself, states otherwise and shall include any individual whose work has ceased as a
has a contract with the latter for teaching services, albeit for one semester consequence of, or in connection with, any current labor dispute or because
only. The University engaged the services of the professors, provided them of any unfair labor practice and who has not obtained any other substantially
work, and paid them compensation or salary for their services. Even if the equivalent and regular employment.
Employees are those who are compensated for their labor or services by
This definition is again, like the definition of the term "employer" [Sec. 2(c)], wages rather than by profits. (People vs. Distributors Division, Smoked Fish
by the use of the term "include", complementary. It embraces not only those Workers Union Local No. 20377, Sup. 7 N. Y. S. 2d 185, 187 in Words and
who are usually and ordinarily considered employees, but also those who Phrases, loc, cit.)
have ceased as employees as a consequence of a labor dispute. The term
"employee", furthermore, is not limited to those of a particular employer. As Services of employee or servant, as distinguished from those of a contractor,
already stated, this Court in the cases of The Angat River Irrigation System, et are usually characterized by regularity and continuity of work for a fixed
al. v. Angat River Workers' Union (PLUM), et al., supra, has defined the term period or one of indefinite duration, as contrasted with employment to do a
"employer" as "one who employs the services of others; one for whom single act or a series of isolated acts; by compensation on a fixed salary rather
employees work and who pays their wages or salaries. "Correlatively, an than one regulated by value or amount of work; . . . (Underwood v.
employee must be one who is engaged in the service of another; who Commissioner of Internal Revenue, C.C.A., 56 F. 2d 67, 71 in Words and
performs services for another; who works for salary or wages. It is admitted Phrases, op. cit., p. 579.)
by the University that the striking professors and/or instructors are under
contract to teach particular courses and that they are paid for their services. Independent contractors can employ others to work and accomplish
They are, therefore, employees of the University. contemplated result without consent of contractee, while "employee" cannot
substitute another in his place without consent of his employer. (Luker Sand
In support of its claim that the members of the Faculty Club are not & Gravel Co. v. Industrial Commission, 23 P. 2d 225, 82 Utah, 188, in Words
employees of the University, the latter cites as authority Francisco's Labor and Phrases, Vol. 14, p. 576).
Laws, 2nd ed., p. 3, which states:
Moreover, even if university professors are considered independent
While the term "workers" as used in a particular statute, has been regarded contractors, still they would be covered by Rep. Act No. 875. In the case of
as limited to those performing physical labor, it has been held to embrace the Boy Scouts of the Philippines v. Juliana Araos, supra, this Court observed
stenographers and bookkeepers. Teachers are not included, however. that Republic Act No. 875 was modelled after the Wagner Act, or the National
Labor Relations Act, of the United States, and this Act did not exclude
It is evident from the above-quoted authority that "teachers" are not to be "independent contractors" from the orbit of "employees". It was in the
included among those who perform "physical labor", but it does not mean subsequent legislation — the Labor Management Relation Act (Taft-Harley
that they are not employees. We have checked the source of the authority, Act) — that "independent contractors" together with agricultural laborers,
which is 31 Am. Jur., Sec. 3, p. 835, and the latter cites Huntworth v. Tanner, individuals in domestic service of the home, supervisors, and others were
87 Wash 670, 152 P. 523, Ann Cas 1917 D 676. A reading of the last case excluded. (See Rothenberg on Labor Relations, 1949, pp. 330-331).
confirms Our view.
It having been shown that the members of the Faculty Club are employees, it
That teachers are "employees' has been held in a number of cases (Aebli v. follows that they have a right to unionize in accordance with the provisions of
Board of Education of City and County of San Francisco, 145 P. 2d 601, 62 Col. Section 3 of the Magna Carta of Labor (Republic Act No. 875) which provides
App 2.d 706; Lowe & Campbell Sporting Goods Co. v. Tangipahoa Parish as follows:
School Board, La. App., 15 So. 2d 98, 100; Sister Odelia v. Church of St.
Andrew, 263 N. W. 111, 112, 195 Minn. 357, cited in Words and Phrases, Sec. 3. Employees' right to self-organization.—Employees shall have the
Permanent ed., Vol. 14, pp. 806-807). This Court in the Far Eastern University right to self-organization and to form, join or assist labor organizations of
case, supra, considered university instructors as employees and declared their own choosing for the purpose of collective bargaining through
Republic Act No. 875 applicable to them in their employment relations with representatives of their own choosing and to engage in concerted activities
their school. The professors and/or instructors of the University neither for the purpose of collective bargaining and other mutual aid or protection. . .
ceased to be employees when they struck, for Section 2 of Rep. Act 875 .
includes among employees any individual whose work has ceased as
consequence of, or in connection with a current labor dispute. Striking We agree with the statement of the lower court, in its order of March 30,
employees maintain their status as employees of the employer. (Western 1963 which is sought to be set aside in the instant case, that the right of
Cartridge Co. v. NLRB, C.C.A. 7, 139 F2d 855, 858). employees to self-organization is guaranteed by the Constitution, that said
right would exist even if Republic Act No. 875 is repealed, and that regardless
The contention of the University that the professors and/or instructors are of whether their employers are engaged in commerce or not. Indeed, it is Our
independent contractors, because the University does not exercise control considered view that the members of the faculty or teaching staff of private
over their work, is likewise untenable. This Court takes judicial notice that a universities, colleges, and schools in the Philippines, regardless of whether
university controls the work of the members of its faculty; that a university the university, college or school is run for profit or not, are included in the
prescribes the courses or subjects that professors teach, and when and term "employees" as contemplated in Republic Act No. 875 and as such they
where to teach; that the professors' work is characterized by regularity and may organize themselves pursuant to the above-quoted provision of Section
continuity for a fixed duration; that professors are compensated for their 3 of said Act. Certainly, professors, instructors or teachers of private
services by wages and salaries, rather than by profits; that the professors educational institutions who teach to earn a living are entitled to the
and/or instructors cannot substitute others to do their work without the protection of our labor laws — and one such law is Republic Act No. 875.
consent of the university; and that the professors can be laid off if their work
is found not satisfactory. All these indicate that the university has control The contention of the University in the instant case that the members of the
over their work; and professors are, therefore, employees and not Faculty Club can not unionize and the Faculty Club can not exist as a valid
independent contractors. There are authorities in support of this view. labor organization is, therefore, without merit. The record shows that the
Faculty Club is a duly registered labor organization and this fact is admitted by
The principal consideration in determining whether a workman is an counsel for the University.5a
employee or an independent contractor is the right to control the manner of
doing the work, and it is not the actual exercise of the right by interfering The other issue raised by the University is the validity of the Presidential
with the work, but the right to control, which constitutes the test. certification. The University contends that under Section 10 of Republic Act
(Amalgamated Roofing Co. v. Travelers' Ins. Co., 133 N.E. 259, 261, 300 Ill. No. 875 the power of the President of the Philippines to certify is subject to
487, quoted in Words and Phrases, Permanent ed., Vol. 14, p. 576). the following conditions, namely: (1) that here is a labor dispute, and (2) that
said labor dispute exists in an industry that is vital to the national interest.
Where, under Employers' Liability Act, A was instructed when and where to The University maintains that those conditions do not obtain in the instant
work . . . he is an employee, and not a contractor, though paid specified sum case. This contention has also no merit.
per square. (Heine v. Hill, Harris & Co., 2 La. App. 384, 390, in Words and
Phrases, loc, cit.) . We have previously stated that the University is an establishment or
enterprise that is included in the term "industry" and is covered by the
provisions of Republic Act No. 875. Now, was there a labor dispute between . . . The fact, however, is that because of the strike declared by the members
the University and the Faculty Club? of the minority union which threatens a major industry the President
deemed it wise to certify the controversy to the Court of Industrial Relations
Republic Act No. 875 defines a labor dispute as follows: for adjudication. This is the power that the law gives to the President the
propriety of its exercise being a matter that only devolves upon him. The
The term "labor dispute" includes any controversy concerning terms, tenure same is not the concern of the industrial court. What matters is that by virtue
or conditions of employment, or concerning the association or representation of the certification made by the President the case was placed under the
of persons in negotiating, fixing, maintaining, changing, or seeking to arrange jurisdiction of said court. (Emphasis supplied)
terms or conditions of employment regardless of whether the disputants
stand in proximate relation of employer and employees. To certify a labor dispute to the CIR is the prerogative of the President under
the law, and this Court will not interfere in, much less curtail, the exercise of
The test of whether a controversy comes within the definition of "labor that prerogative. The jurisdiction of the CIR in a certified case is exclusive
dispute" depends on whether the controversy involves or concerns "terms, (Rizal Cement Co., Inc. v. Rizal Cement Workers Union (FFW), et al., G.R. No.
tenure or condition of employment" or "representation." It is admitted by the L-12747, July 30, 1960). Once the jurisdiction is acquired pursuant to the
University, in the instant case, that on January 14, 1963 the President of the presidential certification, the CIR may exercise its broad powers as provided
Faculty Club wrote to the President of the University a letter informing the in Commonwealth Act 103. All phases of the labor dispute and the employer-
latter of the organization of the Faculty Club as a labor union, duly registered employee relationship may be threshed out before the CIR, and the CIR may
with the Bureau of Labor Relations; that again on January 22, 1963 another issue such order or orders as may be necessary to make effective the exercise
letter was sent, to which was attached a list of demands consisting of 26 of its jurisdiction. The parties involved in the case may appeal to the Supreme
items, and asking the President of the University to answer within ten days Court from the order or orders thus issued by the CIR.
from date of receipt thereof; that the University questioned the right of the
Faculty Club to be the exclusive representative of the majority of the And so, in the instant case, when the President took into consideration that
employees and asked proof that the Faculty Club had been designated or the University "has some 18,000 students and employed approximately 500
selected as exclusive representative by the vote of the majority of said faculty members", that `the continued disruption in the operation of the
employees; that on February 1, 1963 the Faculty Club filed with the Bureau of University will necessarily prejudice the thousand of students", and that "the
Labor Relations a notice of strike alleging as reason therefor the refusal of the dispute affects the national interest",7 and certified the dispute to the CIR, it
University to bargain collectively with the representative of the faculty is not for the CIR nor this Court to pass upon the correctness of the reasons
members; that on February 18, 1963 the members of the Faculty Club went of the President in certifying the labor dispute to the CIR.
on strike and established picket lines in the premises of the University,
thereby disrupting the schedule of classes; that on March 1, 1963 the Faculty The third issue raised by the University refers to the question of the legality
Club filed Case No. 3666-ULP for unfair labor practice against the University, of the return-to-work order (of March 30, 1963 in Case 41-IPA) and the order
but which was later dismissed (on April 2, 1963 after Case 41-IPA was implementing the same (of April 6, 1963). It alleges that the orders are illegal
certified to the CIR); and that on March 7, 1963 a petition for certification upon the grounds: (1) that Republic Act No. 875, supplementing
election, Case No. 1183-MC, was filed by the Faculty Club in the CIR.6 All Commonwealth Act No. 103, has withdrawn from the CIR the power to issue
these admitted facts show that the controversy between the University and a return-to-work order; (2) that the only power granted by Section 10 of
the Faculty Club involved terms and conditions of employment, and the Republic Act No. 875 to the CIR is to issue an order forbidding the employees
question of representation. Hence, there was a labor dispute between the to strike or forbidding the employer to lockout the employees, as the case
University and the Faculty Club, as contemplated by Republic Act No. 875. It may be, before either contingency had become a fait accompli; (3) that the
having been shown that the University is an institution operated for profit, taking in by the University of replacement professors was valid, and the
that is an employer, and that there is an employer-employee relationship, return-to-work order of March 30, 1963 constituted impairment of the
between the University and the members of the Faculty Club, and it having obligation of contracts; and (4) the CIR could not issue said order without
been shown that a labor dispute existed between the University and the having previously determined the legality or illegality of the strike.
Faculty Club, the contention of the University, that the certification made by
the President is not only not authorized by Section 10 of Republic Act 875 but The contention of the University that Republic Act No. 875 has withdrawn the
is violative thereof, is groundless. power of the Court of Industrial Relations to issue a return-to-work order
exercised by it under Commonwealth Act No. 103 can not be sustained.
Section 10 of Republic Act No. 875 provides: When a case is certified by the President to the Court of Industrial Relations,
the case thereby comes under the operation of Commonwealth Act No. 103,
When in the opinion of the President of the Philippines there exists a labor and the Court may exercise the broad powers and jurisdiction granted to it by
dispute in an industry indispensable to the national interest and when such said Act. Section 10 of Republic Act No. 875 empowers the Court of Industrial
labor dispute is certified by the President to the Court of Industrial Relations, Relations to issue an order "fixing the terms of employment." This clause is
said Court may cause to be issued a restraining order forbidding the broad enough to authorize the Court to order the strikers to return to work
employees to strike or the employer to lockout the employees, and if no and the employer to readmit them. This Court, in the cases of the Philippine
other solution to the dispute is found, the Court may issue an order fixing the Marine Officers Association vs. The Court of Industrial Relations, Compania
terms and conditions of employment. Maritima, et al.; and Compañia Martima, et al. vs. Philippine Marine Radio
Officers Association and CIR, et al., G.R. Nos. L-10095 and L-10115, October
This Court had occasion to rule on the application of the above-quoted 31, 1957, declared:
provision of Section 10 of Republic Act No. 875. In the case of Pampanga
Sugar Development Co. v. CIR, et al., G.R. No. L-13178, March 24, 1961, it was We cannot subscribe to the above contention. We agree with counsel for the
held: Philippine Radio Officers' Association that upon certification by the President
under Section 10 of Republic Act 875, the case comes under the operation of
It thus appears that when in the opinion of the President a labor dispute Commonwealth Act 103, which enforces compulsory arbitration in cases of
exists in an industry indispensable to national interest and he certifies it to labor disputes in industries indispensable to the national interest when the
the Court of Industrial Relations the latter acquires jurisdiction to act thereon President certifies the case to the Court of Industrial Relations. The evident
in the manner provided by law. Thus the court may take either of the intention of the law is to empower the Court of Industrial Relations to act in
following courses: it may issue an order forbidding the employees to strike or such cases, not only in the manner prescribed under Commonwealth Act 103,
the employer to lockout its employees, or, failing in this, it may issue an order but with the same broad powers and jurisdiction granted by that act. If the
fixing the terms and conditions of employment. It has no other alternative. It Court of Industrial Relations is granted authority to find a solution to an
can not throw the case out in the assumption that the certification was industrial dispute and such solution consists in the ordering of employees to
erroneous. return back to work, it cannot be contended that the Court of Industrial
Relations does not have the power or jurisdiction to carry that solution into
xxx xxx xxx effect. And of what use is its power of conciliation and arbitration if it does
not have the power and jurisdiction to carry into effect the solution it has
adopted? Lastly, if the said court has the power to fix the terms and substitutes for the strikers, because the company was losing, and it was
conditions of employment, it certainly can order the return of the workers imperative that it lay off such laborers as were not necessary for its operation
with or without backpay as a term or condition of employment. in order to save the company from bankruptcy. This was the reason of this
Court in ruling, in that case, that the legality or illegality of the strike should
The foregoing ruling was reiterated by this Court in the case of Hind Sugar Co. have been decided first before the issuance of the return-to-work order. The
v. CIR, et al., G.R. No. L-13364, July 26, 1960. University, in the case before Us, does not claim that it no longer needs the
services of professors and/or instructors; neither does it claim that it was
When a case is certified to the CIR by the President of the Philippines imperative for it to lay off the striking professors and instructors because of
pursuant to Section 10 of Republic Act No. 875, the CIR is granted authority impending bankruptcy. On the contrary, it was imperative for the University
to find a solution to the industrial dispute; and the solution which the CIR has to hire replacements for the strikers. Therefore, the ruling in the Philippine
found under the authority of the presidential certification and conformable Can case that the legality of the strike should be decided first before the
thereto cannot be questioned (Radio Operators Association of the Philippines issuance of the return-to-work order does not apply to the case at bar.
vs. Philippine Marine Radio Officers Association, et al., L-10112, Nov. 29, Besides, as We have adverted to, the return-to-work order of March 30,
1957, 54 O.G. 3218). 1963, now in question, was a confirmation of an agreement between the
University and the Faculty Club during a prehearing conference on March 23,
Untenable also is the claim of the University that the CIR cannot issue a 1963.
return-to-work order after strike has been declared, it being contended that
under Section 10 of Republic Act No. 875 the CIR can only prevent a strike or The University also maintains that there was no more basis for the claim of
a lockout — when either of this situation had not yet occurred. But in the the members of the Faculty Club to return to their work, as their individual
case of Bisaya Land Transportation Co., Inc. vs. Court of Industrial Relations, contracts for teaching had expired on March 25 or 31, 1963, as the case may
et al., No. L-10114, Nov. 26, 1957, 50 O.G. 2518, this Court declared: be, and consequently, there was also no basis for the return-to-work order of
the CIR because the contractual relationships having ceased there were no
There is no reason or ground for the contention that Presidential certification positions to which the members of the Faculty Club could return to. This
of labor dispute to the CIR is limited to the prevention of strikes and lockouts. contention is not well taken. This argument loses sight of the fact that when
Even after a strike has been declared where the President believes that public the professors and instructors struck on February 18, 1963, they continued to
interest demands arbitration and conciliation, the President may certify the be employees of the University for the purposes of the labor controversy
ease for that purpose. The practice has been for the Court of Industrial notwithstanding the subsequent termination of their teaching contracts, for
Relations to order the strikers to work, pending the determination of the Section 2(d) of the Industrial Peace Act includes among employees "any
union demands that impelled the strike. There is nothing in the law to individual whose work has ceased a consequence of, or in connection with,
indicate that this practice is abolished." (Emphasis supplied) any current labor dispute or of any unfair labor practice and who has not
obtained any other substantially equivalent and regular employment."
Likewise untenable is the contention of the University that the taking in by it
of replacements was valid and the return-to-work order would be an The question raised by the University was resolved in a similar case in the
impairment of its contract with the replacements. As stated by the CIR in its United States. In the case of Rapid Roller Co. v. NLRB 126 F. 2d 452, we read:
order of March 30, 1963, it was agreed before the hearing of Case 41-IPA on
March 23, 1963 that the strikers would return to work under the status quo On May 9, 1939 the striking employees, eighty-four in number, offered to the
arrangement and the University would readmit them, and the return-to-work company to return to their employment. The company believing it had not
order was a confirmation of that agreement. This is a declaration of fact by committed any unfair labor practice, refused the employees' offer and
the CIR which we cannot disregard. The faculty members, by striking, have claimed the right to employ others to take the place of the strikers, as it
not abandoned their employment but, rather, they have only ceased from might see fit. This constituted discrimination in the hiring and tenure of the
their labor (Keith Theatre v. Vachon et al., 187 A. 692). The striking faculty striking employees. When the employees went out on a strike because of the
members have not lost their right to go back to their positions, because the unfair labor practice of the company, their status as employees for the
declaration of a strike is not a renunciation of their employment and their purpose of any controversy growing out of that unfair labor practice was
employee relationship with the University (Rex Taxicab Co. vs. CIR, et al., 40 fixed. Sec. 2 (3) of the Act. Phelps Dodge Corp. v. National Labor Relations
O.G., No. 13, 138). The employment of replacements was not authorized by Board, 313 U.S. 177, 61 S. Ct. 845, 85. L. ed. 1271, 133 A.L.R. 1217.
the CIR. At most, that was a temporary expedient resorted to by the
University, which was subject to the power of the CIR to allow to continue or For the purpose of such controversy they remained employees of the
not. The employment of replacements by the University prior to the issuance company. The company contended that they could not be their employees in
of the order of March 30, 1963 did not vest in the replacements a permanent any event since the "contract of their employment expired by its own terms
right to the positions they held. Neither could such temporary employment on April 23, 1939."
bind the University to retain permanently the replacements.
In this we think the company is mistaken for the reason we have just pointed
Striking employees maintained their status as employees of the employer out, that the status of the employees on strike became fixed under Sec. 2 (3)
(Western Castridge Co. v. National Labor Relations Board, C.C.A. 139 F. 2d of the Act because of the unfair labor practice of the company which caused
855, 858) ; that employees who took the place of strikers do not displace the strike.
them as `employees." ' (National Labor Relations Board v. A. Sartorius & Co.,
C.C.A. 2, 140 F. 2d 203, 206, 207.) The University, furthermore, claims that the information for indirect
contempt filed against the officers of the University (Case No. V-30) as well as
It is clear from what has been said that the return-to-work order cannot be the order of April 29, 1963 for their arrest were improper, irregular and illegal
considered as an impairment of the contract entered into by petitioner with because (1) the officers of the University had complied in good faith with the
the replacements. Besides, labor contracts must yield to the common good return-to-work order and in those cases that they did not, it was due to
and such contracts are subject to the special laws on labor unions, collective circumstance beyond their control; (2) the return-to-work order and the
bargaining, strikes and similar subjects (Article 1700, Civil Code). order implementing the same were illegal; and (3) even assuming that the
order was legal, the same was not Yet final because there was a motion to
Likewise unsustainable is the contention of the University that the Court of reconsider it.
Industrial Relations could not issue the return-to-work order without having
resolved previously the issue of the legality or illegality of the strike, citing as Again We find no merit in this claim of Petitioner. We have already ruled that
authority therefor the case of Philippine Can Company v. Court of Industrial the CIR had jurisdiction to issue the order of March 30, 1963 in CIR Case 41-
Relations, G.R. No. L-3021, July 13, 1950. The ruling in said case is not IPA, and the return-to-work provision of that order is valid and legal.
applicable to the case at bar, the facts and circumstances being very different. Necessarily the order of April 6, 1963 implementing that order of March 30,
The Philippine Can Company case, unlike the instant case, did not involve the 1963 was also valid and legal.
national interest and it was not certified by the President. In that case the
company no longer needed the services of the strikers, nor did it need
Section 6 of Commonwealth Act No. 103 empowers the Court of Industrial SEC. 19. Implied condition in every contract of employment.—In every
Relations of any Judge thereof to punish direct and indirect contempts as contract of employment whether verbal or written, it is an implied condition
provided in Rule 64 (now Rule 71) of the Rules of Court, under the same that when any dispute between the employer and the employee or laborer
procedure and penalties provided therein. Section 3 of Rule 71 enumerates has been submitted to the Court of Industrial Relations for settlement or
the acts which would constitute indirect contempt, among which is arbitration pursuant to the provisions of this Act . . . and pending award, or
"disobedience or resistance to lawful writ, process, order, judgment, or decision by the Court of such dispute . . . the employee or laborer shall not
command of a court," and the person guilty thereof can be punished after a strike or walk out of his employment when so enjoined by the Court after
written charge has been filed and the accused has been given an opportunity hearing and when public interest so requires, and if he has already done so,
to be heard. The last paragraph of said section provides: that he shall forthwith return to it, upon order of the Court, which shall be
issued only after hearing when public interest so requires or when the
But nothing in this section shall be so construed as to prevent the court from dispute cannot, in its opinion, be promptly decided or settled; and if the
issuing process to bring the accused party into court, or from holding him in employees or laborers fail to return to work, the Court may authorize the
custody pending such proceedings. employer to accept other employees or laborers. A condition shall further be
implied that while such dispute . . . is pending, the employer shall refrain
The provision authorizes the judge to order the arrest of an alleged from accepting other employees or laborers, unless with the express
contemner (Francisco, et al. v. Enriquez, L-7058, March 20, 1954, 94 Phil., authority of the Court, and shall permit the continuation in the service of his
603) and this, apparently, is the provision upon which respondent Judge employees or laborers under the last terms and conditions existing before the
Bautista relied when he issued the questioned order of arrest. dispute arose. . . . A violation by the employer or by the employee or laborer
of such an order or the implied contractual condition set forth in this section
The contention of petitioner that the order of arrest is illegal is unwarranted. shall constitute contempt of the Court of Industrial Relations and shall be
The return-to-work order allegedly violated was within the court's jurisdiction punished by the Court itself in the same manner with the same penalties as
to issue. in the case of contempt of a Court of First Instance. . . .

Section 14 of Commonwealth Act No. 103 provides that in cases brought We hold that the CIR acted within its jurisdiction when it ordered the arrest
before the Court of Industrial Relations under Section 4 of the Act (referring of the officers of the University upon a complaint for indirect contempt filed
to strikes and lockouts) the appeal to the Supreme Court from any award, by the Acting Special Prosecutor of the CIR in CIR Case V-30, and that order
order or decision shall not stay the execution of said award, order or decision was valid. Besides those ordered arrested were not yet being punished for
sought to be reviewed unless for special reason the court shall order that contempt; but, having been charged, they were simply ordered arrested to
execution be stayed. Any award, order or decision that is appealed is be brought before the Judge to be dealt with according to law. Whether they
necessarily not final. Yet under Section 14 of Commonwealth Act No. 103 are guilty of the charge or not is yet to be determined in a proper hearing.
that award, order or decision, even if not yet final, is executory, and the stay
of execution is discretionary with the Court of Industrial Relations. In other Let it be noted that the order of arrest dated April 29, 1963 in CIR Case V-30
words, the Court of Industrial Relations, in cases involving strikes and is being questioned in Case G.R. No. L-21278 before this Court in a special
lockouts, may compel compliance or obedience of its award, order or civil action for certiorari. The University did not appeal from that order. In
decision even if the award, order or decision is not yet final because it is other words, the only question to be resolved in connection with that order
appealed, and it follows that any disobedience or non-compliance of the in CIR Case V-30 is whether the CIR had jurisdiction, or had abused its
award, order or decision would constitute contempt against the Court of discretion, in issuing that order. We hold that the CIR had jurisdiction to issue
Industrial Relations which the court may punish as provided in the Rules of that order, and neither did it abuse its discretion when it issued that order.
Court. This power of the Court of Industrial Relations to punish for contempt
an act of non-compliance or disobedience of an award, order or decision, In Case G.R. No. L-21462 the University appealed from the order of Judge
even if not yet final, is a special one and is exercised only in cases involving Villanueva of the CIR in Case No. 1183-MC, dated April 6, 1963, granting the
strikes and lockouts. And there is reason for this special power of the motion of the Faculty Club to withdraw its petition for certification election,
industrial court because in the exercise of its jurisdiction over cases involving and from the resolution of the CIR en banc, dated June 5, 1963, denying the
strikes and lockouts the court has to issue orders or make decisions that are motion to reconsider said order of April 6, 1963. The ground of the Faculty
necessary to effect a prompt solution of the labor dispute that caused the Club in asking for the withdrawal of that petition for certification election was
strike or the lockout, or to effect the prompt creation of a situation that because the issues involved in that petition were absorbed by the issues in
would be most beneficial to the management and the employees, and also to Case 41-IPA. The University opposed the petition for withdrawal, but at the
the public — even if the solution may be temporary, pending the final same time it moved for the dismissal of the petition for certification election.
determination of the case. Otherwise, if the effectiveness of any order,
award, or decision of the industrial court in cases involving strikes and It is contended by the University before this Court, in G.R. L-21462, that the
lockouts would be suspended pending appeal then it can happen that the issues of employer-employee relationship between the University and the
coercive powers of the industrial court in the settlement of the labor disputes Faculty Club, the alleged status of the Faculty Club as a labor union, its
in those cases would be rendered useless and nugatory. majority representation and designation as bargaining representative in an
appropriate unit of the Faculty Club should have been resolved first in Case
The University points to Section 6 of Commonwealth Act No. 103 which No. 1183-MC prior to the determination of the issues in Case No. 41-IPA, and,
provides that "Any violation of any order, award, or decision of the Court of therefore, the motion to withdraw the petition for certification election
Industrial Relations shall after such order, award or decision has become final, should not have been granted upon the ground that the issues in the first
conclusive and executory constitute contempt of court," and contends that case were absorbed in the second case.
only the disobedience of orders that are final (meaning one that is not
appealed) may be the subject of contempt proceedings. We believe that We believe that these contentions of the University in Case G.R. No. L-21462
there is no inconsistency between the above-quoted provision of Section 6 have been sufficiently covered by the discussion in this decision of the main
and the provision of Section 14 of Commonwealth Act No. 103. It will be issues raised in the principal case, which is Case G.R. No. L-21278. After all,
noted that Section 6 speaks of order, award or decision that is executory. By the University wanted CIR Case 1183-MC dismissed, and the withdrawal of
the provision of Section 14 an order, award or decision of the Court of the petition for certification election had in a way produced the situation
Industrial Relations in cases involving strikes and lockouts are immediately desired by the University. After considering the arguments adduced by the
executory, so that a violation of that order would constitute an indirect University in support of its petition for certiorari by way of appeal in Case
contempt of court. G.R. No. L-21278, We hold that the CIR did not commit any error when it
granted the withdrawal of the petition for certification election in Case No.
We believe that the action of the CIR in issuing the order of arrest of April 29, 1183-MC. The principal case before the CIR is Case No. 41-IPA and all the
1963 is also authorized under Section 19 of Commonwealth Act No. 103 questions relating to the labor disputes between the University and the
which provides as follows: Faculty Club may be threshed out, and decided, in that case.
In Case G.R. No. L-21500 the University appealed from the order of the CIR of
March 30, 1963, issued by Judge Bautista, and from the resolution of the CIR J. C. Espinas & Associates for petitioner (Gaston Group)
en banc promulgated on June 28, 1963, denying the motion for the
reconsideration of that order of March 30, 1963, in CIR Case No. 41-IPA. We Jose K. Manguiat Jr. for respondent Court, et al.
have already ruled that the CIR has jurisdiction to issue that order of March
30, 1963, and that order is valid, and We, therefore, hold that the CIR did not E. Morabe & Associate for respondent (Gomez Group).
err in issuing that order of March 30, 1963 and in issuing the resolution
promulgated on June 28, 1963 (although dated May 7, 1963) denying the
motion to reconsider that order of March 30, 1963. CASTRO, C.J.:

IN VIEW OF THE FOREGOING, the petition for certiorari and prohibition with These are two petitions for certiorari (L-33705 and L-35206), consolidated for
preliminary injunction in Case G.R. No. L-21278 is dismissed and the writs purposes of decision because they involve more or less the same parties and
prayed for therein are denied. The writ of preliminary injunction issued in interlocking issues.
Case G.R. No. L-21278 is dissolved. The orders and resolutions appealed
from, in Cases Nos. L-21462 and L-21500, are affirmed, with costs in these In L-33705 the petitioner Air Line Pilots Association of the Philippines (Gaston
three cases against the petitioner-appellant Feati University. It is so ordered. group) maintains that the Court of Industrial Relations acted without
jurisdiction in passing upon (1) the question of which, in a certification
Concepcion, C.J., Dizon, Regala, Makalintal, Bengzon, J.P., Sanchez and Castro, proceeding, between the set of officers elected by the group of Philippine Air
JJ., concur. Lines pilots headed by Captain Felix Gaston, on the one hand, and the set of
Reyes, J.B.L., J., concurs but reserves his vote on the teacher's right to strike. officers elected by the group headed by Captain Ben Hur Gomez, on the
other, is the duly elected set of officers of the Air Line Pilots Association of
G.R. No. L-33705 April 15, 1977 the Philippines, and (2) the question of which, between the two groups, is
entitled to the name, office and funds of the said Association.
AIR LINE PILOTS ASSOCIATION OF THE PHILIPPINES (GASTON GROUP),
petitioner, In L-35206 the individual petitioners (numbering 127) and the Air Line Pilots
vs. Association of the Philippines (hereinafter referred to as ALPAP) (Gaston
THE COURT OF INDUSTRIAL RELATIONS and AIR LINES PILOTS ASSOCIATION maintain that the industrial Court acted without jurisdiction and with grave
OF THE PHILIPPINES (GOMEZ GROUP), respondents. abuse of descretion in promulgating its resolution dated June 19, 1972 which
suspended the hearing of the said petitioners' plea below for reinstatement
G.R. No. L-35206 April 15, 1977 and/or return to work in the Philippine Air Lines (hereinafter referred to as
PAL) or, alternatively, the payment of their retirement and/or separation pay,
CESAR CHAVEZ, JUR FRANCISCO ACHONDOA, SERAFIN ADVINCULA, MAXIMO as the case may be, until this Court, shall have decided L-33705.
R. AFABLE, ALFREDO AGBULOS, SOLOMON A. HERRERA, NEMESIO ALMARIO,
JULIUS AQUINO, RENE ARELLANO, CARLITO ARRIBE FERNANDO AYUBO L-33705
GENEROSO BALTAZAR, EDDIE BATONG MALAQUE, URSO D. BELLO, TOMAS
BERNALES RUDOLFO BIDES AUGUSTO BLANCO, HORACIO BOBIS ROMEO B. On January 2, 1971, the Air Line Pilots Association of the Philippines,
BONTUYAN ANTONINO E. BUENAVENTURA, PEDRO BUNI ISABELO represented by Ben Hur Gomez who claimed to be its President, filed a
BUSTAMANTE, JOSE BUSTAMANTE, RICARDO BUSTAMANTE, ERNESTO D. petition with the Court of Industrial Relations praying for certification as the
BUZON TRANQUILINO CABE ISIDORO CALLEJA, CESAR CARETA FERNANDO sole and exclusive collective bargaining representative of "all the pilots now
CARAG, ROGELIO CASINO, JOSE CASTILLO, NICANOR CASTILLO, RAFAEL under employment by the Philippine Air Lines, Inc, and are on active flight
CASTRO, JOSE DE LA CONCEPCION, CARLOS CRUZ, WILFREDO CRUZ, and/or operational assignments." The petition which was docketed in the sala
MAGINOO CUSTODIO, TOMAS DE LA JOSE DE LEON, BENJAMIN DELFIN, of Judge Joaquin M. Salvador as Case 2939-MC was opposed in the name of
GREGORIO DELGADO, IRINEO DEROTAS DUMAGUIN BENEDICTO FELICIANO, the same association by Felix C. Gaston (who also claimed to be its President)
RODRIGO FRIAS JOSE GIL, ANTONIO GOMEZ, ROBERTO GONZALEZ, on the ground that the industrial court has no jurisdiction over the subject-
BIENVENIDO GOROSPE, AMADO R. GULOY JOSE GUTIERREZ, ANTONIO matter o" the petition "because a certification proceeding in the Court of
IBARRETA MUSSOLINI IGNACIO, ROBERTO INIGO MATIAS JABIER ROGELIO Industrial Relations is not the proper forum for the adjudication of the
JARAMILLO HARRY JISON, ALBERTO JOCSON, VALENTIN LABATA JAIME question as to who is the lawful president of a legitimate labor organization."
LACSON, JORGE LACSON, FRANCISCO LANSANG MENANDRO LAUREANO,
JESUS LAQUINDANUM LEONARDO LONTOC, RAUL LOPEZ, RENE LORENZO, On May 29, 1971, after hearing the petition, Judge Salvador rendered a
OSBORNE LUCERO, ARISTON LUISTRO MANUEL LUKBAN, VIRGILIO MABABA, decision certifying the —
MARIANO MAGTIBAY, EDGARDO MAJARAIS EMILIO MALLARE LEONCIO
MANARANG, ALFREDO MARBELLA, ALFREDO MARTINEZ, EDILBERTO ... ALPAP composed only of pilots employed by PAL with Capt. Ben Hur
MEDINA, CLEMENTE MIJARES, EDMUNDO MISA, CONRADO MONTALBAN, Gomez as its president, as the sole and exclusive Bargaining representative of
FERNANDO NAVARRETE, EUGENIO NAVEA ERNESTO TOMAS, NIERRAS all the pilots employed by PAL and are on active flights and/or operational
PATROCINIO OBRA, VICTORINO ORGULLO CLEMENTE PACIS, CESAR PADILLA, assignments, and as such is entitled to all the rights and privileges of a
ROMEO PAJARILLO RICARDO PANGILINAN, CIRILO PAREDES, AMANDO PARIS legitimate labor organization, including the right to its office and its union
ALBERTO PAYUMO, PEDRO PENERA FRANCISCO PEPITO, ADOLFO PEREZ, funds.
DOMINGO POLOTAN EDUARDO RAFAEL, SANTOS RAGAZA TEODORO
RAMIREZ, RAFAEL RAVENA ANTONIO REYES, GREGORIO RODRIGUEZ, The following circumstances were cited by Judge Salvador to justify the
LEONARDO SALCEDO, HENRY SAMONTE, PAQUITO SAMSON, ARTHUR B. conclusions reached by him in his decision, namely:
SANTOS, ARTURO T. SANTOS ANGELES SARTE, VALERIANO SEGURA, RUBEN
SERRANO, LINO SEVERINO, ANGEL SEVILLA, BENJAMIN SOLIS, PATROCINIO (a) that there has been no certification election within the Period of 12
TAN, RAFAEL TRIAS EDGARDO VELASCO, LORETO VERGEIRE RUBEN months prior to the date the petition for certification was filed;
VICTORINO, ALEXANDER VILLACAMPA, CAMILO VILLAGONZALO BAYANI
VILLANUEVA, RIZAL VILLANUEVA, ROMULO VILLANUEVA, ROLANDO (b) that the PAL entered into a collective bargaining agreement with ALPAP
VILLANUEVA, CARLOS VILLAREAL, and ALFONSO SAPIRAIN AND OTHERS and for "pilots in the employ of the Company" only for the duration of the period
AIR LINE PILOTS ASSOCIATION. OF THE PHILIPPINES (GASTON), petitioners, from February 1, 1969 to January 31, 1972:
vs.
THE HONORABLE JUDGES ARSENIO I. MARTINEZ, AMANDO C. BUGAYONG (c) that PAL pilots belonging to the Gaston, group, in defiance of court
and JOAQUIN M. SALVADOR of the COURT OF INDUSTRIAL RELATIONS, BEN orders issued in Case 101-IPA(B) (see L-35206, infra) retired/resigned en
HUR GOMEZ, claiming to represent AIR LINE PILOTS ASSOCIATION OF THE masse from the PAL and retired/resigned accompanied this with actual acts
PHILIPPINES, CARLOS ORTIZ AND OTHERS, and PHILIPPINE AIR LINES INC., of not reporting for work;
respondents.
(d) that the pilots affiliated with the Gaston group tried to then deposits
and other funds from the ALPAP Cooperative Credit union on the ground that L-35206
they have already retired/resigned from PAL;
On October 3, 1970, the President of the Philippines certified a labor dispute
(e) that some of the members of the Gaston Group joined another airline between members of ALPAP and the PAL to the Court of Industrial Relations.
after their retirement/resignation; The dispute which had to do with union economic demands was docketed as
Case No. 101-IPA(B) and was assigned to Judge Ansberto P. Paredes.
(f) that the Gaston group claimed before the industrial court that the order
enjoining them from retiring or resigning constituted a violation of the On October 7, 1970, after conferring with both parties for two days, Judge
prohibition against involuntary servitude (see L-35206, infra); Paredes issued a return-to-work order, the pertinent portions of which read
as follows:
(g) that the contention that the mess retirement or resignation was merely
an involuntary protest by those affiliated with the Gaston group is not borne PALEA and ALPAP, their officers and members, and i 11 employees who have
out by the evidence as, aside their aforementioned acts, the said group of joined the present strike which resulted from the labor disputes certified by
pilots even filed a civil complaint against the PAL in which the cessation of the President to the Court, or who have not reported for work as a result of
their employment with PAL was strongly expressed by them. the strikes, are hereby ordered forthwith to call off the strikes and lift the
picket lines ... and return to work not later than Friday, October 9, 1970, and
It appears that prior to the filing of the certification petition below, a general management to admit them back to work under the same terms and
ALPAP membership meeting was held on October 30, 1970, at which 221 out conditions of employment existing before the strikes, including what has
of 270 members adopted a resolution amending ALPAP's constitution and by- been earlier granted herein.
laws by providing in a new section thereof that —
PAL is ordered not to suspend, dismiss or lay-off any employee as a result of
Any active member who shall be forced to retire or forced to resign or these strikes. Read into this order is the provision of Section 19, C.A. 103, as
otherwise terminated for union activities as solely determine' by the amended, for the guidance of the parties,
Association shall have the option to either continue to be and remain as an
active member in good standing or to resign in writing his active membership xxx xxx xxx
with the Association. ...
Failure to comply with any provision of this Order shall constitute contempt
According to ALPAP (Gaston), the foregoing amendment was adopted "In of court, and the employee failing or refusing to work by October 9, 1970,
anticipation on the fact that they may be forced to resign or retire because of without justifiable cause, shall immediately be replaced by PAL, and may not
their 'union activities.' At this period of time, PAL and ALPAP were locked in a be reinstated without prior Court order and on justifiable grounds.
labor dispute certified by the President to the Industrial court and docketed
as Case 101-IPA(B) (see L-35206, infra). On October 10, 1970, Judge Paredes, having been informed that the strikes
had not been called off, issued another order directing the strikers to lift their
On December 12, 1970, despite a no-work-stoppage order of the industrial pickets and return to work and explaining that his order of October 7, 1970
court, a substantial majority of ALPAP members filed letters of partook of the nature of amandatory injunction under the doctrine laid down
retirement/resignation from the PAL. in Philippine Association of Free Labor Union (PAFLU) vs. Hon, Joaquin M.
Salvador, et al., (L-29471 and L-29487, September 28, 1968).
Thereafter, on December 18-22, 1970, an election of ALPAP officers was held.
resulting in the election of Felix C. Gaston as President by 180 votes. Upon The strike, however, continued until the industrial court en banc denied, on
the other hand, on December 23, 1970, about 45 pilots who did not tender October 19, 1970, ALPAP's motion for reconsideration of the said orders.
their retirement or resignation the PAL gathered at the house of Atty. Morabe
and elected Ben Hur Gomez as ALPAP President. On October 22, 1970, the strikers returned to work, except (according to the
PAL) two pilots, one of them being Felix C. Gaston who allegedly refused to
On June 3, 1971, ALPAP (Gaston) filed an opposition in Case 101-IPAB to an take the flights assigned to him. Due to his refusal, among other reasons, PAL
urgent ex parte motion of the PAL to enjoin the members of ALPAP from terminated Gaston's services on October 27, 1970. His dismissal was reported
retiring or resigning en masse It was claimed by ALPAP (Gaston) that — to the industrial court on October 29, 1970. Thereafter, the court a quo set
the validity of Gaston's dimissal for hearing, but, on several occassions, he
1. Insofar as herein oppositors are concerned, the allegations of refused to submit his side before the hearing examiner, claiming that his case
respondent that their 'resignations' and 'retirements' are sham resignations would be prosecuted through the proper forum at the proper time.
and retirements and that 'There is no honest or genuine desire to terminate
the employee relationship with PAL are completely false. Their bona fide On November 24, 1970, the PAL filed an urgent ex parte motion with the
intention to terminate their employer-employee relationship with PAL is industrial court to enjoin the members of ALPAP from proceeding with their
conclusively shown by the fact that they have not sought reinstatement in or intention to retire or resign en masse. On November 26, 1970, Judge Paredes
re-employment by PAL and also by the fact that they are either seeking issued an order commanding ALAPAP members —
employment in another airline company;
... not to strike or in any way cause any stoppage in the operation and service
2. Respondent in effect recognized such bona fide intention of the herein of PAL, under pain of dismisal and forfeiture of rights, and privilieges accruing
oppositors as shown by the fact that it accepted said resignations and to their respective employments should they disregard this Order; and PAL is
retirements and did not initiate any contempt proceedings against them; and also ordered not to lockout any of such members and officers of ALPAP under
pain of contempt and cancellation of its franchise.
3. The action of herein oppositors in filing their resignations and
retirements was a legitimate exercise of their legal and constitutional rights ALPAP filed a motion for the reconsideration of the foregoing order claiming,
and the same, therefore, cannot be considered as a valid ground to deprive among other, that it subjected them to involuntary servitude:
them of benefits which they had already earned including, among others,
retirement benefits to which they are entitled under the provisions of an It is crystal-clear that the disputed Order in effect compels the members of
existing contract between petitioner and respondent. Such deprivation would petiitioner to work against their will. Stated differently, the members of
constitute impairment of the obligations of contract. petitioner association are bieng perced or forced by the Trial Court to be in a
state of slavery for the beneift of respondent corporation. In this regard,
On June 15, 1971, the industrial court en banc, acting on a motion for therefore, the Trial Court grossly violated a Constitutional mandate which
reconsideration filed by ALPAP (Gaston) in Case 2939-MC against the decision states:
of Judge Salvador, denied the same. The said court's resolution was then
appealed to this Court (L-33705).
No involuntary servitude in any form shall exist except as a punishment for c ALPAP (Gomez) opposed the foregoing petitions. In this connection, the
rime whereof the party shall have been duly convicted. (Article III, Section 1 records disclose that on August 20, 1971, 89 of the pilots who retired en
(13)). masse from PAL filed a complaint with the Court of First Instance of Manila in
Case 15084 for the recovery of retirement benefits due them under the PAL
The constitutional provision does not provide any condition as to the cause or Retirement Plan. The complaint was dismissed by the trial, court on PAL's
causes of the unwillingness to work. Suffice it to say that an employee for motion. The records, however, do not disclose the reason for the said
whatever reason of his own. cannot be compelled and forced to work against dismissal.
his will.
On December 23, 1971, Judge Paredes issued an order deferring action on
The court a quo however, denied the foregoing motion for reconsideration on the motion to dismiss the petitions for reinstatement on the ground that the
December 11, 1970. matters alleged in the said petitions would required the submission of proof.
ALPAP (Gomez,) filed a motion for reconsideration of this order but the same
Just the same, on December 12, 1970, a substantial majority of the members was denied by the industrial court en banc for being pro forma.
of ALPAP staged a mass resignation and/or retirement from PAL
On February 1, 1972, ALPAP (Gaston) joined and consolidated the mentioned
In vigorous protest to your provocative harrassment, unfair labor tactics, the petitions for reinstatement, The same was opposed by both PAL and ALPAP
contemptuous lockout of our co-members and your vicious and vindictive (Gomez),
attitude towards labor most exemplified by the illegal termination of the
services of our President, Capt, Felix C. Gaston On March 24, 1972, ALPAP (Gomez) filed a motion to suspend the
proceedings in Case 101-IPA(B) until the prejudicial question of who should
The mentioned individual letters of retirement/resignation were accepted by prosecute the main case (Case 101-IPA) is resolved. On April 18, 1972, Judge
PAL on December 14, 1970, with the caveat that the pilots concerned will not Paredes issued an order deferring the hearing of the main case until this
be entitled to any benefit or privilege to which they may otherwise be Court shall have decided L-33705, but allowing other matters, including the
entitled by reason of their employment with the PAL, as the pilots' acts consolidated petition for reinstatement, to be heard.
constituted R violation of the November 26, 1970 order of the industrial
court. On. May 5, 1972, ALPAP (Gomez) filed another motion to suspend the
hearing on the mentioned petition for reinstatement on the ground that this
On December 28, 1970, Ben Hur Gomez, alleging that he was elected Court's decision in L-33705 should be awaited. ALPAP (Gaston) opposed that
President of ALPAP by its members who did not join the mass resignation and motion on the ground that the matter had already been denied twice and the
retirement, filed a motion in Case 101 IPA by praying that he be allowed to order setting the case for hearing was merely. On May 15, 1972, Judge
represent the ALPAP which was theretofore represented by Capt. Felix Gaston Paredes denied the said motion to suspend the hearing on the petition for
because the pilots who retired or resigned from PAL ceased to be employees reinstatement unless a countermanding Order is issued by a higher Court."
Thereof and no longer have any interest in the subject-matter of the said
case. This was later converted into a motion to intervene on February 9, On May 18, 1972, ALPAP (Gomez) filed a motion for reconsideration of Judge
1971. Paredes' order, alleging that employee status of those who resigned or
retired en masse was an issue in mentioned Case 2939-MC decision on which
On September 1, 1971, Felix Gaston filed a motion for Contempt against PAL is still pending consideration before Court in L-33705.
stating that his dismissal from PAL on October 27, 1970 was without just
cause and violation of the Order of the industrial court dated October 7, 1970 On June 19, 1972, the industrial court en banc passed a resolution reversing
as well as section 19 of C.A. 103. He prayed that he be reinstated. Judge Paredes' order on the ground that the question of the employee status
of the pilots who were seeking reinstatement with PAL has already been
On October 23, 1971, twenty-one pilots who filed their retirement. from PAL raised squarely in Case 2939-MC and resolved by the said tribunal found that
filed a petition in the 'Industrial court praying also that they be readmitted to the said pilots have already lost their employee status as a consequence of
PAL or, failing so, that they be allowed to retire with the benefits provided for their resignations and/or retirement from PAL which had been duly accepted
under the PAL Retirement Plan or, if they are not yet e i b e to under said by the latter.
Plan, that they be given separation pay, In their petition for reinstatement,
said Pilots (who were later joined by other pilots similarly situated) alleged, DISCUSSION
inter alia —
In 'Its brief before this Court, ALPAP (Gaston) states that it goes not question
1. That they are some of the employees of the respondent company and the recognition extended by PAL to ALPAP (Gomez ) the collective bargaining
members of the petitioner union who resigned en masse or retired en masse agent of all PAL pilots on active flight duty. Neither does it dispute the
from the respondent after having been led to believe in good faith by Capt. assumption by ALPAP (Gomez) of the authority to manage and administer the
Felix Gaston who was then the uncontested president of the petitioner union collective bargaining agreement between ALPAP and PAL (which at any rate
and their counsel that such a mass resignation or mass retirement was a valid had expired on January 31, 1972) nor the right of ALPAP (Gomez) to negotiate
exercise of their right to protest the dismissal of Capt. Gaston in connection and conclude any other collective bargaining agreement with PAL. What it
with the Certified dispute that was pending before the Court. disputes, however, is the authorization given by the industrial court to ALPAP
(Gomez), in a certification proceeding, to take over the corporate name,
2. That later on they came to know that such a mass resignation or office and funds of ALPAP.
surpass retirement was enjoined by this Honorable Court 'under the pain of'
dismissal and forfeiting of rights and privileges accruing to their respective This Court has always stressed that a certification proceeding is not a
employment if they disregarded such order of injunction, litigation, in the sense in which this term is ordinarily understood, but an
investigation of a non-adversary, fact finding character in which the Court of
3. That they did not deliberately disregard such injunction order and if Industrial Relations plays the part of a disinterested investigator seeking
they failed to comply with it within a reasonable time, it was because they merely to ascertain the desires of employees as to the matter of their
were made to believe and assured by their leader that such resignation or representation (National Labor Union vs. Go Soc and Sons, 23 SCRA 436;
retirement was a lawful exercise of concerted action that the full Benguet Consolidated, Inc. vs. Bobok Lumber Jack Ass'n., L-11029, May 23,
consequences of such act was not explained to them by counsel: and in 1958; Bulakena Restaurant and Caterer vs. C.I.R., 45 SCRA 95; LVN Pictures,
addition, they were told that those who returned to the company would be Inc. vs. Philippine Musicians Guild (FFW) and C.I.R., 1 SCRA 132). Such being
expelled from the union, and suffer the corresponding penalty. the nature of a certification proceeding, we find no cogent reason that should
prevent the industrial court, in such a proceeding, from inquiring into and
xxx xxx xxx satisfying itself about matters which may be relevant and crucial. though
seemingly beyond the purview of such a proceeding, to the complete
realization of the well-known purposes of a certification case.
Such a situation may arise, as it did in the case at bar, where a group of pilots While this Court considers the ruling of the court below, on the matter of
of a particular airline, allegedly anticipation their forced retirement or who has the exclusive rights to the office, funds and name of ALPAP, as having
resignation on account of strained relations with the airline arising from been erroneously made, we cannot hold, however, that those belonging to
unfulfilled economic demands, decided to adopt an amendment to their the group of ALPAP (Gomez) do not possess any right at all over the office,
organization's constitution and by-laws in order to enable them to retain their funds and name of ALPAP of which they are also members.
membership standing therein even after the termination of their
employment with the employer concerned. The industrial court definitely In our opinion, it is perfectly within the powers and prerogatives of a labor
should be allowed ample discretion to secure a disclosure of circumstances organization, through its duly elected officers, to authorize a segment of that
which will enable it to act fairly in a certification case. organization to bargain collectively with a particular employer, particularly
where those constituting the segment share a common and distinguishable
This Court nonetheless finds, after a close and dispassionate study of the interest, apart from the rest of their fellow union members, on matters that
facts on record, that the industrial court's conclusion, that the mentioned directly affect the terms and conditions of their particular employment. As
amendment to the ALPAP constitution and by-laws is illegal (a) because it was the circumstances pertinent to the case at bar presently stand, ALPAP
not adopted in accordance with the procedure prescribed and (b) because (Gaston) has extended recognition to ALPAP (Gomez) to enter and conclude
member of labor organization cannot adopt an amendment to their collective bargaining contracts with PAL. Having given ALPAP (Gomez) this
fundamental charter so as to include non employees (of PAL) as member, is authority, it would be clearly unreasonable on the part of ALPAP (Gaston) to
erroneous. disallow the former a certain use of the office, funds and name of ALPAP
when such use is necessary or would be required to enable ALPAP (Gomez) to
We have made a careful examination of the records of L-33705 and we find exercise, in a proper manner, its delegated authority to bargain collectively
the adoption of the resolution introducing the questioned amendment to be with PAL. Clearly, an intelligently considered adjustment of grievances and
substancial compliance with the ALPAP constitution and by-law. Indeed, there integration of the diverse and varying interests that not infrequently and,
is no refutation of the act that 221out of the 270 members of ALPAP did cast often, unavoidably permeate the membership of a labor organization, will go
their votesin favor of the said amendment on October 30, 1970 at the ALPAP a long way, in achieving peace and harmony within the ranks of ALPAP. Of
general membership meeting. course, in the eventuality that the pilots presently employed by PAL and who
subscribe to the leadership of Ben Hur Gomez should consider it to their
Their Court cannot likewise subcribe to the restrictive interpretation made by better interest to have their own separate office, name and union funds,
the court below of the term "labor organization," which Section 2(e) of R.A. nothing can prevent them from setting up a separate labor union. In that
875 defines as any union or association of employees which exist, in whole or eventuality, whatever vested rights, interest or participation they may have in
in part, for the purpose of the collective bargaining or dealing with employers the assets, including cash funds, of ALPAP as a result of their membership
concerning terms and conditions of employment." The absence of the therein should properly be liquidated in favor of such withdrawing members
condition which the court below would attach to the statutory concept of a of the association.
labor organization, as being limited to the employees of particular employer,
is quite evident from the law. The emphasis of Industrial Peace Act is clearly On the matter of whether the industrial court also abuse its authority for
on the pourposes for which a union or association of employees established allowing ALPAP (Gomez) to appropriate the ALPAP name, it does not appear
rather than that membership therein should be limited only to the that the herein petitioner has shown below any exclusive franchise or right to
employees of a particular employer. Trite to say, under Section 2(h) of R.A the use of that name. Hence, there is no proper basis for correcting the
875 "representative" is define as including "a legitimate labor organization or action taken by the court below on this regard.
any officer or agent of such organization, whether or not employed by the
employer or employeewhom he represents." It cannot be overemphasized L-35206
likewise that labor dispute can exist "regardless of whether the disputants
stand in the proximate relation of employer and employee. (Section 2(j), R.a. The threshold issue posed in L-35206 is whether the Court of Industrial
875). Relations acted without jurisdiction and with grave abuse of discretion in
promulgating the resolution dated June 19, 1972 suspending hearings on the
There is, furthermore, nothing in the constitution and by-laws of ALPAP which mentioned petition for reinstatement until this Court shall have decided L-
indubitably restricts membership therein to PAL pilots alone. 1 Although 33705.
according to ALPAP (Gomez there has never been an instance when a non-
PAL pilot became a member of ALPAP, the complete lack of any such We find no merit to the charge made.
precondition for ALPAP membership cannot but be interpreted as an
unmistakable authority for the association to accept pilots into its fold though While it is correct, as submitted by ALPAP (Gaston), that in the 1971 case of
they may not be under PAL's employ. Philippine Federation of Petroleum Workers (PFPW) vs. CIR (37 SCRA 716) this
Court held that in a certified labor dispute all issues involved in the same
The fundamental assumptions relied upon by the industrial court as bases for should be determined in the case where the certified dispute was docketed
authorizing ALPAP (Gomez) to take over the office and funds of ALPAP being, and that the parties should not be permitted to isolate other germane issues
in this Court's opinion, erroneous, and, in the absence of any serious dispute or demands and reserve them for determination in the other cases pending
that on December 18-22, 1970 Felix C. Gaston, and four other pilots, were before other branches of the industrial court, non-compliance with this rule
elected by the required majority of ALPAP members as officers of their is at best an error in procedure, rather than of jurisdiction, which is not
association, this Court hereby rules that the mentioned authorization to beyond the power of this Court to review where sufficient reasons exists, a
ALPAP (Gomez) to take over the office, funds and name of ALPAP was done situation not obtaining in the case at bar.
with grave abuse of discretion.
After a thoroughgoing study of the records of these two consolidated
Moreover, this Court cannot hold as valid and binding the election of Ben Hur petitions, this Court finds that the matter of the reinstatement of the pilots
Gomez as President of ALPAP. He was elected at a meeting of only 45 ALPAP who retired or resigned from PAL was ventilated fully and adequately in the
members called just one day after the election of Felix C. Gaston as President certification case in all its substantive aspects, including the allegation of the
of ALPAP who, as shown, received a majority of 180 votes out of a total herein petitioners that they were merely led to believe in good faith that in
membership of 270. tender the provisions of section 4, article in of the retiring or resigning from PAL they were simply exercising their rights to
Constitution and By-Laws of ALPAP, duly elected officers of that association engage in concerted activity. In the light of the circumstances thus found
shall remain in office for ac least one year; below it can be safely concluded that the mass retirement and resignation
action of the herein petitioners was intentionally planned to abort the effects
The term of office of the officers of the Association shall start on the first day of the October 7, 10 and 19, 1970 return-to-work orders of the industrial
of the fiscal year of the Association. It shall continue for one year or until they court (which they, in fact, ignored for more than a week) by placing
are re-elected or until their successors have been elected or appointed and themselves beyond the jurisdictional control of the said court through the
takes office in accordance with the Constitution and by-laws. umbrella of the constitutional, prohibition against involuntary servitude,
thereby enabling them to pursue their main pressure objective of grounding Barredo, Makasiar, Antonio, Muñoz Palma, Concepcion, Jr., and Martin, JJ.,
most, if not all, PAL flight operations. Clearly, the powers given to the concur.
industrial court in a certified labor dispute will be meaningless and useless to
pursue where its jurisdiction cannot operate. Fernando, J, concurs in the opinion of the Chief Justice in L-33705 and in the
opinion of Justice Teehankee in L-35206.
We cannot consequently disagree with the court a quo when it concluded
that the actuations of the herein petitioners after they retired and resigned Aquino, J., took no part.
en masse — their retrieval of deposits and other funds from the ALPAP
Cooperative Credit Union on the ground that they have already retired or
resigned, their employment with another airline, the filing of a civil suit for
the recovery of their retirement pay where they invoked the Provision against
involuntary servitude to obtain payment thereof, and their repeated
manifestations before the industrial court that their retirement and
resignation were not sham, but voluntary, and intentional — are, in the Separate Opinions
aggregate, indubitable indications that the said pilots did retire/resign from
PAL with full awareness of the Likely consequences of their acts. Their
protestations of good faith, after nearly a year of underscoring the fact that
they were no longer employed with PAL, cannot but appear to a reasonable TEEHANKEE, J., concurring:
mind as a late and regrettable ratiocination.
In L-33705, a certification proceeding, I concur with the ruling 1 that there is
Parenthetically, contrary to ALPAP (Gaston)'s argument that the pilots' nothing in the law which supports respondent court's restrictive
retirement' resignation was a legitimate concerted activity , citing Section interpretation that would limit membership in a labor organization to the
2(1) of the Industrial Peace Act which defines "strike" as "any temporary employees of a particular employer, (for such an archaic view would be
stoppage of work by the concerted action of employees as a result of an practically a death blow to the cause of unionism and would fragment unions
industrial dispute," it is worthwhile to observe that as the law defines it, a into as many employers that there may be); and that specifically in the case
strike means only a "temporary stoppage of work." What the mentioned of ALPAP (Air Line Pilots Association of the Philippines) there is nothing in its
pilots did, however, cannot be considered, in the opinion of this Court, as Constitution and by-laws that would restrict its membership to Philippine Air
mere "temporary stoppage of work." What they contemplated was evidently Lines, Inc. (PAL) pilots alone. (Obviously, the organizational set up was for
a permanent cut-off of employment relationship with their erstwhile ALPAP as a union to be composed of all airline pilots in the Philippines
employer, the Philippine Air Lines. In any event, the dispute below having regardless of employer, patterned after the ALPAP (Air Line Pilots Association)
been certified as existing in an industry indispensable to the national interest, in the United States which has a reputed membership of 46,000 with locals
the said pilots' rank disregard for the compulsory orders of the industrial established by the members at their respective companies of employment).
court and their daring and calculating venture to disengage themselves from
that court's jurisdiction, for the obvious purpose of satisfying their narrow The Court therefore properly upheld the election of the Gaston faction by a
economic demands to the prejudice of the public interest, are evident badges clear majority of the ALPAP membership (1221 out of 270) as against the
of bad faith. Gomez faction of 45 members; recognized Gaston's election as president of
ALPAP as against the rump election of Gomez to the same position; and ruled
A legitimate concerted activity is a matter that cannot be used to circumvent out respondent court's action of authorizing the Gomez faction to take over
judicial orders or be tossed around like a plaything Definitely, neither the office, funds and name of ALPAP as a grave abuse of discretion and a
employers nor employees should be allowed to make of judicial authority a nullity.
now-youve-got-it-now-you-dont affair. The courts cannot hopefully effectuate
and vindicate the sound policies of the Industrial Peace Act and all our labor Of course, only the pilots actually in the employ of the PAL to the exclusion of
laws if employees, particularly those who on account of their highly, those who had resigned or retired or otherwise been separated from its
advanced technical background and relatively better life status are far above employment could take part in the PAL certification election. Under normal
the general working class spectrum, will be permitted to defy and invoke the circumstances, the ALPAP as the duly organized labor union (composed of
jurisdiction of the courts whenever the alternative chosen will serve to both factions) would manage and administer the collective bargaining
feather their pure and simple economic demands. agreement arrived at between employer and employees.

ACCORDINGLY, in L-33705 the resolution of the Court of Industrial Relations But this did not hold true in the present case, since in effect the Gomez
dated June 15, 1971 upholding the decision of Judge Joaquin M. Salvador faction consisting of pilots who continued in the employ of PAL and did not
dated May 29, 1971 is hereby modified in accordance with the foregoing follow the action of the majority composing the Gaston faction of resigning
opinion. Felix 6. Gaston or whoever may be the incumbent President of and retiring en masse from their employment separated themselves from
ALPAP is hereby ordered to give to any member withdrawing his membership ALPAP and were granted separate recognition by PAL as the ALPAP (Gomez)
from ALPAP whatever right, interest or participation such member may have faction constituting the exclusive collective bargaining representation for the
in the assets, including cash funds, of ALPAP as a result of his membership in pilots who continued in its employ, The original union ALPAP as headed by
that association. Gaston on concedes this and makes it quite clear in its brief that it does not
question the recognition extended by PAL to the Gomez faction nor the
In L-35206, the petition assailing the resolution of the Court of Industrial latter's right to manage and administer the collective bargaining agreement
Relations dated June 19, 1972, is hereby dismissed for lack of merit insofar as and to negotiate and conclude any other collective bargaining agreement
the petitioners' allegations of their right to reinstatement with PAL is with PAL.
concerned. With reference to the alternative action, re: payment of their
claims for retirement or separation pay, the Secretary of Labor, in accordance The actual dispute was thus reduced to whether the Gomez faction in
with the applicable procedure prescribed by law, is hereby ordered to separating themselves from ALPAP as headed by Gaston could take over and
determine whether such claim is in order, particularly in view of the caveat appropriate the corporate name, office and funds of ALPAP, as authorized by
made by PAL, in accepting the petitioners' individual letters of respondent court.
retirement/resignation, that said petitioners shall not be entitled to any
benefit or privilege to which they may otherwise be entitled by reason of Such take-over or appropriation of ALPAP by the Gomez faction could not be
their employment with PAL as the former's acts constituted a violation of the validly done nor authorized by respondent court, as now ruled by this Court.
order of the industrial court dated November 26, 1970. But since ALPAP does recognize the right of the Gomez faction to separate
and secede from ALPAP and for the members of the Gomez faction composed
Without costs in both instances. of pilots who have remained in the employ of PAL to form their own union,
the Court's judgment has ordered ALPAP as headed by Gaston as the
recognized president thereof or his duly elected successor to give to any
withdrawing member i.e. the members of the Gomez faction "whatever right. Withal, the Court's decision requires the National Labor Relations
interest or participation such member may have in the assets, including cash Commission with reference to the pilots' alternative claims for retirement or
funds of ALPAP as a result of his membership in that association." separation pay "to determine whether such claim is in order, particularly in
view of the caveat made by PAL, in accepting the petitioners' individual
I take this to mean that ALPAP is thereby ordered to liquidate the letters of retirement/resignation, that said petitioners shall not be entitled to
membership of each withdrawing member although ALPAP is a non-stock any benefit or privilege to which they may otherwise be entitled by reason of
association) and give him the equivalent of the net book value in cash of his their employment with PAL as the former's acts constituted a violation of the
aliquot share in the net asset of ALPAP as of the date of withdrawal of de order of the industrial court dated November 26, 1970."
facto of the Gomez faction which may be fixed as December 23, 1970, the
late when Ben Hur Gomez was elected as president of his faction by ALPAP The said November 26, 1970 order commanded ALPAP members "not to
members who did no join the mass resignation of retirement, I believe that in strike or in any way Cause any stoppage in the operation and service of PAL,
fairness the Equivalent value of any use made by the Gomez faction of the under pain of dismissal and forfeiture of rights and privileges accruing to
ALPAP office and funds from and after their date of withdrawal (which their respective employments should they disregard this Order; and PAL is
obviously was in and for their own exclusive interest and benefit) should in also ordered not to lockout any of such members and officers of ALPAP under
turn be offset against whatever may be determined to be the collective value pain of contempt and cancellation of its franchise.
of their ALPAP membership as of the date of their withdrawal on December
23, 1970. I venture to suggest as a specific guideline 5 for the National Labor Relations
Commission's consideration (in order to expedite settlement of the case and
In L-35206, the judgment penned by the Chief Justice rejects the petitioners- assuage the anxieties of petitioners and their families) that the pending
pilots' petition for readmission to PAL and their rounds in support thereof, question appears to be one of law, whose resolution would not be affected
inter alia, that they were led to believe in good faith by their union president by the proof that may be submitted to the said commission upon remand of
Gaston and their counsel that their mass resignation and retirement were a the case.
valid exercise of' their right to protest the dismissal of Gaston
notwithstanding the pendency of their certified dispute in the industrial The question of law is: was it within the industrial court's power as provided
court, that they were assured by their leader that it was a lawful exercise of in Judge Paredes' above-quoted order to order "forfeiture of rights and
concerted action, that the full consequences of such act were not explained privileges accruing to their respective employments" should they disregard
to them by counsel and that they had so acted under threat of expulsion his return-to-work order? It should be noted that the PAL in accepting the
from the union (which appear to be borne out by the fact that within the letters of retirement/resignation made the caveat that the pilots concerned
year after finally appreciating the full consequences of their illconceived mass would forfeit any retirement benefit or privilege that they would otherwise
protest reitrement and resignation they sought to withdraw the same and be entitled to by reason of their employment with PAL, as their acts
petitioned for readmission in line with the return-to-work orders). constituted a violation of the cited return-to-work order, thus indicating that
were it not for such order, PAL would have no basis for imposing any
The principal ground for the Court's judgment cannot be faulted, to wit, that forfeiture of earned retirement privileges since it was in turn accepting the
such action of mass retirement and resignation which plainly intended to pilots' retirement and resignation.
abort the effects of the indusgtrial court's return-to-work orders and to place
petitioners-pilots beyond the court's return-to-work orders and to place If the industrial court had no such power to order forfeiture of the pilots'
petitioners-pilots beyond the court's jurisdictional control, after the President retirement/resignation privileges and benefits for violation of its return to
had certified the labor dispute thereto for compulsory arbitration in the work order, then there would be no legal basis for the denial of such
public interest, could not be sanctioned nor tolerated since "clearly, the retirement privileges and benefits.
powers given to the industrial court in a certified labor dispute will be
meaningless and useless to pursue where its jurisdiction cannot operate. 2 That the industrial court had such power is open to grave doubts. For
disregard and violation of the return to work order, the industrial court could
Still, since the industrial court en banc set aside Judge Paredes' orders to impose the capital penalty of dismissal from employment. True, the pilots
receive proof on the pilots' petitions for reinstatement on the basis inter alia carried out an advised mass retirement/resignation to abort the effects of the
of the Gomez factions' contention that the prejudicial question of who of the return-to-work order but the effectiveness of the penalty of dismissal is
two faction's contention that the prejudicial question of who of the two borne out by the fact that within the year the pilots had come to realize and
factions should prosecute the main case (the labor dispute) should first be regret the futility of their act and were seeking readmission Then again, the
resolved in the certification case pending as Case L-33705 before theis Court industrial Court had the power of contempt — it could have declared the
3 and since the matters raised in the petition for reinstatement were quite mass retirement illegal as this Court has in fact so declared and used its
serious and did required the submission of proof as held by Judge Paredes in coercive power of contempt under Rule 71, section 7 by requiring
the December 23, 1971 order, the question of merit of the pilots' rank-and- imprisonment of the petitioners until they purged themselves of contempt by
file petitions for reinstatement could perhaps have been deferred and complying with the return-to-work order.
likewise remanded to the National Labor Relations Commission — since after
all their alternative prayer for payment of their claims for retirement or But to declare the forfeiture of retirement privileges and benefits which the
speration pay is being remanded to the National Labor Relations Commission petitioners had earned and would otherwise be entitled to by reason of their
"to determine whether such claim is in order" by receiving the proof of the years of employment of PAL appears to be beyond the coercive as well as
parties — and such proof covers the very same matters raised as supporting punitive powers of the industrial court — in the same way that is threatened
grounds and reasons in the petitions for reinstatment. cancellation of PAL's franchise as granted by Congress for violation of the
lockout prohibition aspect of the same order was beyond its powers.
After all, if the pilots duly substantiated with convincing proof their
allegations in support of their petitions for reinstatement that they had been The end result, then, would be that assuming that petitioners had willfully
misled and/or coerced by their leader and counsel into presenting their mass violated the rertun-to-work order of November 26, 1970 and had not ben
retirement and resignation without the full consequences having been misled into presenting their mass retirement/resignation, such violation
explained to them the pilots would be in the same situation of rank-and-file could not legally result in a forfeiture of their retirement prvileges and
members of a union who engage in an illegal strike, in which case under this benefits as decreed in the order since such forfeiture was beyond the
Court's liberal and compassionate doctrine, only the leaders (and those who industrial court's power and authorituy. Their loss of employment and the
actually resorted to violence which is of no application here) would receive denial of their readmission certainly constitute sufficient punshment and
the capital of dismissal — unless this Court were somehow to make an vindication of the court's authority. All the more so would such non-forteiture
exception of the pilots and exclude them from the application of this of earned reirement privileges and benefits be in consonance with fairness
established doctrine because "of their highly advanced technical background and equity should the pilots duly establish the factual averments of thier
and relatively better life status — far above the general working class cited petition for readmission and for payment of their said privileges and
spectrum." 4 benefits.
fairness the Equivalent value of any use made by the Gomez faction of the
ALPAP office and funds from and after their date of withdrawal (which
obviously was in and for their own exclusive interest and benefit) should in
turn be offset against whatever may be determined to be the collective value
of their ALPAP membership as of the date of their withdrawal on December
Separate Opinions 23, 1970.

TEEHANKEE, J., concurring: In L-35206, the judgment penned by the Chief Justice rejects the petitioners-
pilots' petition for readmission to PAL and their rounds in support thereof,
In L-33705, a certification proceeding, I concur with the ruling 1 that there is inter alia, that they were led to believe in good faith by their union president
nothing in the law which supports respondent court's restrictive Gaston and their counsel that their mass resignation and retirement were a
interpretation that would limit membership in a labor organization to the valid exercise of' their right to protest the dismissal of Gaston
employees of a particular employer, (for such an archaic view would be notwithstanding the pendency of their certified dispute in the industrial
practically a death blow to the cause of unionism and would fragment unions court, that they were assured by their leader that it was a lawful exercise of
into as many employers that there may be); and that specifically in the case concerted action, that the full consequences of such act were not explained
of ALPAP (Air Line Pilots Association of the Philippines) there is nothing in its to them by counsel and that they had so acted under threat of expulsion
Constitution and by-laws that would restrict its membership to Philippine Air from the union (which appear to be borne out by the fact that within the
Lines, Inc. (PAL) pilots alone. (Obviously, the organizational set up was for year after finally appreciating the full consequences of their illconceived mass
ALPAP as a union to be composed of all airline pilots in the Philippines protest reitrement and resignation they sought to withdraw the same and
regardless of employer, patterned after the ALPAP (Air Line Pilots Association) petitioned for readmission in line with the return-to-work orders).
in the United States which has a reputed membership of 46,000 with locals
established by the members at their respective companies of employment). The principal ground for the Court's judgment cannot be faulted, to wit, that
such action of mass retirement and resignation which plainly intended to
The Court therefore properly upheld the election of the Gaston faction by a abort the effects of the indusgtrial court's return-to-work orders and to place
clear majority of the ALPAP membership (1221 out of 270) as against the petitioners-pilots beyond the court's return-to-work orders and to place
Gomez faction of 45 members; recognized Gaston's election as president of petitioners-pilots beyond the court's jurisdictional control, after the President
ALPAP as against the rump election of Gomez to the same position; and ruled had certified the labor dispute thereto for compulsory arbitration in the
out respondent court's action of authorizing the Gomez faction to take over public interest, could not be sanctioned nor tolerated since "clearly, the
the office, funds and name of ALPAP as a grave abuse of discretion and a powers given to the industrial court in a certified labor dispute will be
nullity. meaningless and useless to pursue where its jurisdiction cannot operate. 2

Of course, only the pilots actually in the employ of the PAL to the exclusion of Still, since the industrial court en banc set aside Judge Paredes' orders to
those who had resigned or retired or otherwise been separated from its receive proof on the pilots' petitions for reinstatement on the basis inter alia
employment could take part in the PAL certification election. Under normal of the Gomez factions' contention that the prejudicial question of who of the
circumstances, the ALPAP as the duly organized labor union (composed of two faction's contention that the prejudicial question of who of the two
both factions) would manage and administer the collective bargaining factions should prosecute the main case (the labor dispute) should first be
agreement arrived at between employer and employees. resolved in the certification case pending as Case L-33705 before theis Court
3 and since the matters raised in the petition for reinstatement were quite
But this did not hold true in the present case, since in effect the Gomez serious and did required the submission of proof as held by Judge Paredes in
faction consisting of pilots who continued in the employ of PAL and did not the December 23, 1971 order, the question of merit of the pilots' rank-and-
follow the action of the majority composing the Gaston faction of resigning file petitions for reinstatement could perhaps have been deferred and
and retiring en masse from their employment separated themselves from likewise remanded to the National Labor Relations Commission — since after
ALPAP and were granted separate recognition by PAL as the ALPAP (Gomez) all their alternative prayer for payment of their claims for retirement or
faction constituting the exclusive collective bargaining representation for the speration pay is being remanded to the National Labor Relations Commission
pilots who continued in its employ, The original union ALPAP as headed by "to determine whether such claim is in order" by receiving the proof of the
Gaston on concedes this and makes it quite clear in its brief that it does not parties — and such proof covers the very same matters raised as supporting
question the recognition extended by PAL to the Gomez faction nor the grounds and reasons in the petitions for reinstatment.
latter's right to manage and administer the collective bargaining agreement
and to negotiate and conclude any other collective bargaining agreement After all, if the pilots duly substantiated with convincing proof their
with PAL. allegations in support of their petitions for reinstatement that they had been
misled and/or coerced by their leader and counsel into presenting their mass
The actual dispute was thus reduced to whether the Gomez faction in retirement and resignation without the full consequences having been
separating themselves from ALPAP as headed by Gaston could take over and explained to them the pilots would be in the same situation of rank-and-file
appropriate the corporate name, office and funds of ALPAP, as authorized by members of a union who engage in an illegal strike, in which case under this
respondent court. Court's liberal and compassionate doctrine, only the leaders (and those who
actually resorted to violence which is of no application here) would receive
Such take-over or appropriation of ALPAP by the Gomez faction could not be the capital of dismissal — unless this Court were somehow to make an
validly done nor authorized by respondent court, as now ruled by this Court. exception of the pilots and exclude them from the application of this
But since ALPAP does recognize the right of the Gomez faction to separate established doctrine because "of their highly advanced technical background
and secede from ALPAP and for the members of the Gomez faction composed and relatively better life status — far above the general working class
of pilots who have remained in the employ of PAL to form their own union, spectrum." 4
the Court's judgment has ordered ALPAP as headed by Gaston as the
recognized president thereof or his duly elected successor to give to any Withal, the Court's decision requires the National Labor Relations
withdrawing member i.e. the members of the Gomez faction "whatever right. Commission with reference to the pilots' alternative claims for retirement or
interest or participation such member may have in the assets, including cash separation pay "to determine whether such claim is in order, particularly in
funds of ALPAP as a result of his membership in that association." view of the caveat made by PAL, in accepting the petitioners' individual
letters of retirement/resignation, that said petitioners shall not be entitled to
I take this to mean that ALPAP is thereby ordered to liquidate the any benefit or privilege to which they may otherwise be entitled by reason of
membership of each withdrawing member although ALPAP is a non-stock their employment with PAL as the former's acts constituted a violation of the
association) and give him the equivalent of the net book value in cash of his order of the industrial court dated November 26, 1970."
aliquot share in the net asset of ALPAP as of the date of withdrawal of de
facto of the Gomez faction which may be fixed as December 23, 1970, the The said November 26, 1970 order commanded ALPAP members "not to
late when Ben Hur Gomez was elected as president of his faction by ALPAP strike or in any way Cause any stoppage in the operation and service of PAL,
members who did no join the mass resignation of retirement, I believe that in
under pain of dismissal and forfeiture of rights and privileges accruing to Art. 257. Petitions in unorganized establishments. — In any establishment
their respective employments should they disregard this Order; and PAL is where there is no certified bargaining agent, a certification election shall
also ordered not to lockout any of such members and officers of ALPAP under automatically be conducted by the Med-Arbiter upon the filing of a petition
pain of contempt and cancellation of its franchise. by a legitimate labor organization.

I venture to suggest as a specific guideline 5 for the National Labor Relations The Med-Arbiter, sustained by the Secretary of Labor and Employment, has
Commission's consideration (in order to expedite settlement of the case and ruled that the above provision is mandatory and gives him no other choice
assuage the anxieties of petitioners and their families) that the pending than to conduct a certification election upon the receipt of the corresponding
question appears to be one of law, whose resolution would not be affected petition.
by the proof that may be submitted to the said commission upon remand of
the case. On 26 July 1989, private respondent National Congress of Unions in the Sugar
Industry of the Philippines-TUCP ("NACUSIP-TUCP") filed with the
The question of law is: was it within the industrial court's power as provided Department of Labor and Employment ("DOLE") Regional Office No. VI,
in Judge Paredes' above-quoted order to order "forfeiture of rights and Bacolod City, a petition for direct certification or for certification election to
privileges accruing to their respective employments" should they disregard determine the sole and exclusive collective bargaining representative of the
his return-to-work order? It should be noted that the PAL in accepting the supervisory employees of herein petitioner, Lopez Sugar Corporation ("LSC"),
letters of retirement/resignation made the caveat that the pilots concerned at its sugar central in Fabrica, Sagay, Negros Occidental.
would forfeit any retirement benefit or privilege that they would otherwise
be entitled to by reason of their employment with PAL, as their acts In its petition, docketed Case No. RO6-MA-021-89, NACUSIP-TUCP averred
constituted a violation of the cited return-to-work order, thus indicating that that it was a legitimate national labor organization; that LSC was employing
were it not for such order, PAL would have no basis for imposing any 55 supervisory employees, the majority of whom were members of the
forfeiture of earned retirement privileges since it was in turn accepting the union; that no other labor organization was claiming membership over the
pilots' retirement and resignation. supervisory employees; that there was no existing collective bargaining
agreement covering said employees; and that there was no legal impediment
If the industrial court had no such power to order forfeiture of the pilots' either to a direct certification of NACUSIP-TUCP or to the holding of a
retirement/resignation privileges and benefits for violation of its return to certification election. 1
work order, then there would be no legal basis for the denial of such
retirement privileges and benefits. In its comment and opposition, dated 14 August 1989, LSC contended, among
other things, that the petition was bereft of any legal or factual basis; that the
That the industrial court had such power is open to grave doubts. For petition was nothing more than a useless scrap of paper designed to harass
disregard and violation of the return to work order, the industrial court could the company; and that its employees above the rank-and-file category were
impose the capital penalty of dismissal from employment. True, the pilots in truth unaware of the petition.2
carried out an advised mass retirement/resignation to abort the effects of the
return-to-work order but the effectiveness of the penalty of dismissal is On 18 August 1989, the Commercial and Agro-Industrial Labor Organization
borne out by the fact that within the year the pilots had come to realize and ("CAILO"), a registered labor organization also claiming to count substantial
regret the futility of their act and were seeking readmission Then again, the membership among the LSC supervisory employees, moved to intervene.3
industrial Court had the power of contempt — it could have declared the The motion was granted.4
mass retirement illegal as this Court has in fact so declared and used its
coercive power of contempt under Rule 71, section 7 by requiring On 22 August 1989, NACUSIP-TUCP submitted Charter Certificate No. 003-89,
imprisonment of the petitioners until they purged themselves of contempt by dated 20 July 1989, of the NACUSIP-TUCP Lopez Sugar Central Supervisory
complying with the return-to-work order. Chapter.5 LSC, on its part, submitted a list of its employees above the rank-
and-file status preparatory to the inclusion/exclusion proceedings.6
But to declare the forfeiture of retirement privileges and benefits which the
petitioners had earned and would otherwise be entitled to by reason of their On 13 September 1989, one Carlos S. Gevero, asserting a right to represent
years of employment of PAL appears to be beyond the coercive as well as the "supervisors of LSC," filed a motion to dismiss the petition for lack of
punitive powers of the industrial court — in the same way that is threatened interest on the part of the supervisory employees. 7
cancellation of PAL's franchise as granted by Congress for violation of the
lockout prohibition aspect of the same order was beyond its powers. At the hearing of 20 September 1989, both NACUSIP-TUCP and CAILO failed
to appear. Hearing was re-set for 29 September 19898 but, again, neither
The end result, then, would be that assuming that petitioners had willfully NACUSIP-TUCP nor CAILO appeared. On 16 October 1989, nonetheless, Med-
violated the rertun-to-work order of November 26, 1970 and had not ben Arbiter Felizardo T. Serapio issued an Order9 granting the petition. He ruled
misled into presenting their mass retirement/resignation, such violation that under Article 257 of the Labor Code, as amended, the Med-Arbiter was
could not legally result in a forfeiture of their retirement prvileges and left with no option but to order the conduct of a certification election
benefits as decreed in the order since such forfeiture was beyond the immediately upon the filing of the petition, holding that the subsequent
industrial court's power and authorituy. Their loss of employment and the disaffiliation or withdrawals of members did not adversely affect the standing
denial of their readmission certainly constitute sufficient punshment and of the petition. The dispositive portion of his Order read:
vindication of the court's authority. All the more so would such non-forteiture
of earned reirement privileges and benefits be in consonance with fairness VIEWED IN THE LIGHT OF THE FOREGOING, the petition for certification
and equity should the pilots duly establish the factual averments of thier election among the supervisory employees of the Lopez Sugar Central, filed
cited petition for readmission and for payment of their said privileges and by the NACUSIP-TUCP is, as it is hereby GRANTED with the following choices:
benefits.
1) National Congress of Unions in the Sugar Industry of the Phils.
(NACUSIP-TUCP);
G.R. No. 93117 August 1, 1995
LOPEZ SUGAR CORPORATION, petitioner, vs. HON. SECRETARY OF LABOR AND 2) Commercial and Agro-Industrial Labor Organization (CAILO);
EMPLOYMENT, NATIONAL CONGRESS OF UNIONS IN THE SUGAR INDUSTRY
OF THE PHILIPPINES (NACUSIP) and COMMERCIAL AND AGRO-INDUSTRIAL 3) No Union.
LABOR ORGANIZATION (CAILO), respondents.
The designated representation officer is hereby directed to call the parties to
VITUG, J.: a pre-election conference to thresh out the mechanics of the certification
The decision of public respondent, assailed in this petition for certiorari, is election, including the inclusion and exclusion of voters and to conduct the
anchored on Article 257 of the Labor Code, as amended, which provides: election within twenty (20) days from receipt by the parties of this Order. The
list submitted by the Employer (LSC Employees other than rank and file) shall (c) The local or chapter of a labor federation or national union shall have
be used to determine the eligible voters. and maintain a constitution and by-laws, set of officers and books of
accounts. For reporting purposes, the procedure governing the reporting of
SO ORDERED. 10 independently registered unions, federations or national unions shall be
observed. (Emphasis supplied)
LSC appealed to the DOLE and asseverated that the order was a patent nullity
and that the Med-Arbiter acted with grave abuse of discretion. 11 Since the "procedure governing the reporting of independently registered
unions" refers to the certification and attestation requirements contained in
In denying the appeal, the Secretary of Labor, in his Decision of 06 March Article 235, paragraph 2, it follows that the constitution and by-laws, set of
1990, has likewise ruled that the holding by the Med-Arbiter of a certification officers and books of accounts submitted by the local and chapter must
election is mandatory under Article 257 of the Labor Code; that the likewise comply with these requirements. The same rationale for requiring
subsequent withdrawals and disauthorization/disaffiliation of some the submission of duly subscribed documents upon union registration exists
supervisory personnel in the petition for certification election could not bar in the case of union affiliation. Moreover, there is greater reason to exact
its being granted; and that a certification election is still the most appropriate compliance with the certification and attestation requirements because, as
means to finally settle the issue of representation. 12 previously mentioned, several requirements applicable to independent union
registration are no longer required in the case of the formation of a local or
Hence, this petition for certiorari; it is argued that — chapter. The policy of the law in conferring greater bargaining power upon
Public Respondent Honorable Secretary of Labor and Employment (has) labor unions must be balanced with the policy of providing preventive
committed grave abuse of discretion amounting to lack of jurisdiction when it measures against the commission of fraud.
refused to dismiss a petition for certification election despite clear lack of
legal and factual basis for holding the same. 13 A local or chapter therefore becomes a legitimate labor organization only
upon submission of the following to the BLR:
The Solicitor General agrees with public respondent in arguing that the tenor
of Article 257 (supra) of the Labor Code is one of command. He cites 1) A charter certificate, within 30 days from its issuance by the labor
paragraph 2, Section 6, Rule V, Book V, of the Implementing Rules and federation or national union, and
Regulations of the Labor Code, to the effect that once "a petition (is) filed by
a legitimate organization involving an unorganized establishment, the Med- 2) The constitution and by-laws, a statement on the set of officers, and the
Arbiter shall immediately order the conduct of a certification election," which books of accounts all of which are certified under oath by the secretary or
is designed, he continues, to give substance to the workers' right to self- treasurer, as the case may be, of such local or chapter, and attested to by its
organization.14 Petitioner promptly retorts that it has no quarrel with public president.
respondent on the objectives of the law but it points out that the application
of Article 257 clearly must first be occasioned by a genuine petition from a Absent compliance with these mandatory requirements, the local or chapter
legitimate labor organization. does not become a legitimate labor organization. 16

Not too long ago, the Court already had an opportunity to pass upon this very The only document extant on record to establish the legitimacy of the
issue in Progressive Development Corporation vs. Secretary, Department of NACUSIP-TUCP Lopez Sugar Central Supervisory Chapter is a charter
Labor and Employment, 15 where we said: certificate and nothing else. The instant petition, at least for now, must thus
be GRANTED.
But while Article 257 cited by the Solicitor General directs the automatic
conduct of a certification election in an unorganized establishment, it also WHEREFORE, the assailed Decision of the Secretary of Labor, dated 06 March
requires that the petition for certification election must be filed by a 1990, affirming that of the Med-Arbiter, is ANNULLED and SET ASIDE. The
legitimate labor organization. Article 242 enumerates the exclusive rights of a petition for certification election is dismissed. No costs.
legitimate labor organization among which is the right to be certified as the SO ORDERED.
exclusive representative of all the employees in an appropriate collective
bargaining unit for purposes of collective bargaining. G.R. No. 87700 June 13, 1990
SAN MIGUEL CORPORATION EMPLOYEES UNION-PTGWO, DANIEL S.L.
Meanwhile, Article 212(h) defines a legitimate labor organization as "any BORBON II, HERMINIA REYES, MARCELA PURIFICACION, ET AL., petitioners,
labor organization duly registered with the DOLE and includes any branch or vs. HON. JESUS G. BERSAMIRA, IN HIS CAPACITY AS PRESIDING JUDGE OF
local thereof." (Emphasis supplied) Rule I, Section 1(j), Book V of the BRANCH 166, RTC, PASIG, and SAN MIGUEL CORPORATION, respondents.
Implementing Rules likewise defines a legitimate labor organization as "any
labor organization duly registered with the DOLE and includes any branch, MELENCIO-HERRERA, J.:
local or affiliate thereof." (Emphasis supplied)
Respondent Judge of the Regional Trial Court of Pasig, Branch 166, is taken to
Indeed, the law did not reduce the Med-Arbiter to an automaton which can task by petitioners in this special civil action for certiorari and Prohibition for
instantly be set to impulse by the mere filing of a petition for certification having issued the challenged Writ of Preliminary Injunction on 29 March
election. He is still tasked to satisfy himself that all the conditions of the law 1989 in Civil Case No. 57055 of his Court entitled "San Miguel Corporation vs.
are met, and among the legal requirements is that the petitioning union must SMCEU-PTGWO, et als."
be a legitimate labor organization in good standing.
Petitioners' plea is that said Writ was issued without or in excess of
The petition for certification election, in the case at bench, was filed by the jurisdiction and with grave abuse of discretion, a labor dispute being
NACUSIP-TUCP, a national labor organization duly registered with the DOLE involved. Private respondent San Miguel Corporation (SanMig. for short), for
render Registration Certificate No. FED-402-6390-IP. The legitimate status of its part, defends the Writ on the ground of absence of any employer-
NACUSIP-TUCP might be conceded; being merely, however, an agent for the employee relationship between it and the contractual workers employed by
local organization (the NACUSIP-TUCP Lopez Sugar Central Supervisory the companies Lipercon Services, Inc. (Lipercon) and D'Rite Service
Chapter), the federation's bona fide status alone would not suffice. The local Enterprises (D'Rite), besides the fact that the Union is bereft of personality to
chapter, as its principal, should also be a legitimate labor organization in good represent said workers for purposes of collective bargaining. The Solicitor
standing. Accordingly, in Progressive Development, we elucidated: General agrees with the position of SanMig.

In the case of union affiliation with a federation, the documentary The antecedents of the controversy reveal that:
requirements are found in Rule II, Section 3(e), Book V of the implementing
Rules, which we again quote as follows: Sometime in 1983 and 1984, SanMig entered into contracts for
merchandising services with Lipercon and D'Rite (Annexes K and I, SanMig's
Comment, respectively). These companies are independent contractors duly
licensed by the Department of Labor and Employment (DOLE). SanMig g. blocking, preventing, prohibiting, obstructing and/or impeding the free
entered into those contracts to maintain its competitive position and in ingress to, and egress from, the work places within the bargaining unit
keeping with the imperatives of efficiency, business expansion and diversity referred to in the CBA .., to compel plaintiff to hire the employees or workers
of its operation. In said contracts, it was expressly understood and agreed of LIPERCON and D'RITE;
that the workers employed by the contractors were to be paid by the latter
and that none of them were to be deemed employees or agents of SanMig. h. preventing and/or disrupting the peaceful and normal operation of
There was to be no employer-employee relation between the contractors plaintiff at the work places within the bargaining unit referred to in the CBA,
and/or its workers, on the one hand, and SanMig on the other. Annex 'C' hereof, to compel plaintiff to hire the employees or workers of
LIPERCON and D'RITE. (Annex H, Petition)
Petitioner San Miguel Corporation Employees Union-PTWGO (the Union, for
brevity) is the duly authorized representative of the monthly paid rank-and- Respondent Court found the Complaint sufficient in form and substance and
file employees of SanMig with whom the latter executed a Collective issued a Temporary Restraining Order for the purpose of maintaining the
Bargaining Agreement (CBA) effective 1 July 1986 to 30 June 1989 (Annex A, status quo, and set the application for Injunction for hearing.
SanMig's Comment). Section 1 of their CBA specifically provides that
"temporary, probationary, or contract employees and workers are excluded In the meantime, on 13 March 1989, the Union filed a Motion to Dismiss
from the bargaining unit and, therefore, outside the scope of this SanMig's Complaint on the ground of lack of jurisdiction over the case/nature
Agreement." of the action, which motion was opposed by SanMig. That Motion was
denied by respondent Judge in an Order dated 11 April 1989.
In a letter, dated 20 November 1988 (Annex C, Petition), the Union advised
SanMig that some Lipercon and D'Rite workers had signed up for union After several hearings on SanMig's application for injunctive relief, where the
membership and sought the regularization of their employment with SMC. parties presented both testimonial and documentary evidence on 25 March
The Union alleged that this group of employees, while appearing to be 1989, respondent Court issued the questioned Order (Annex A, Petition)
contractual workers supposedly independent contractors, have been granting the application and enjoining the Union from Committing the acts
continuously working for SanMig for a period ranging from six (6) months to complained of, supra. Accordingly, on 29 March 1989, respondent Court
fifteen (15) years and that their work is neither casual nor seasonal as they issued the corresponding Writ of Preliminary Injunction after SanMig had
are performing work or activities necessary or desirable in the usual business posted the required bond of P100,000.00 to answer for whatever damages
or trade of SanMig. Thus, it was contended that there exists a "labor-only" petitioners may sustain by reason thereof.
contracting situation. It was then demanded that the employment status of
these workers be regularized. In issuing the Injunction, respondent Court rationalized:

On 12 January 1989 on the ground that it had failed to receive any favorable The absence of employer-employee relationship negates the existence of
response from SanMig, the Union filed a notice of strike for unfair labor labor dispute. Verily, this court has jurisdiction to take cognizance of plaintiff's
practice, CBA violations, and union busting (Annex D, Petition). grievance.

On 30 January 1989, the Union again filed a second notice of strike for unfair The evidence so far presented indicates that plaintiff has contracts for
labor practice (Annex F, Petition). services with Lipercon and D'Rite. The application and contract for
employment of the defendants' witnesses are either with Lipercon or D'Rite.
As in the first notice of strike. Conciliatory meetings were held on the second What could be discerned is that there is no employer-employee relationship
notice. Subsequently, the two (2) notices of strike were consolidated and between plaintiff and the contractual workers employed by Lipercon and
several conciliation conferences were held to settle the dispute before the D'Rite. This, however, does not mean that a final determination regarding the
National Conciliation and Mediation Board (NCMB) of DOLE (Annex G, question of the existence of employer-employee relationship has already
Petition). been made. To finally resolve this dispute, the court must extensively
consider and delve into the manner of selection and engagement of the
Beginning 14 February 1989 until 2 March 1989, series of pickets were staged putative employee; the mode of payment of wages; the presence or absence
by Lipercon and D'Rite workers in various SMC plants and offices. of a power of dismissal; and the Presence or absence of a power to control
the putative employee's conduct. This necessitates a full-blown trial. If the
On 6 March 1989, SMC filed a verified Complaint for Injunction and Damages acts complained of are not restrained, plaintiff would, undoubtedly, suffer
before respondent Court to enjoin the Union from: irreparable damages. Upon the other hand, a writ of injunction does not
necessarily expose defendants to irreparable damages.
a. representing and/or acting for and in behalf of the employees of
LIPERCON and/or D'RITE for the purposes of collective bargaining; Evidently, plaintiff has established its right to the relief demanded. (p. 21,
Rollo)
b. calling for and holding a strike vote, to compel plaintiff to hire the
employees or workers of LIPERCON and D'RITE; Anchored on grave abuse of discretion, petitioners are now before us seeking
nullification of the challenged Writ. On 24 April 1989, we issued a Temporary
c. inciting, instigating and/or inducing the employees or workers of LIPERCON Restraining Order enjoining the implementation of the Injunction issued by
and D'RITE to demonstrate and/or picket at the plants and offices of plaintiff respondent Court. The Union construed this to mean that "we can now
within the bargaining unit referred to in the CBA,...; strike," which it superimposed on the Order and widely circulated to entice
the Union membership to go on strike. Upon being apprised thereof, in a
d. staging a strike to compel plaintiff to hire the employees or workers of Resolution of 24 May 1989, we required the parties to "RESTORE the status
LIPERCON and D'RITE; quo ante declaration of strike" (p. 2,62 Rollo).

e. using the employees or workers of LIPERCON AND D'RITE to man the In the meantime, however, or on 2 May 1989, the Union went on strike.
strike area and/or picket lines and/or barricades which the defendants may Apparently, some of the contractual workers of Lipercon and D'Rite had been
set up at the plants and offices of plaintiff within the bargaining unit referred laid off. The strike adversely affected thirteen (13) of the latter's plants and
to in the CBA ...; offices.

f. intimidating, threatening with bodily harm and/or molesting the other On 3 May 1989, the National Conciliation and Mediation Board (NCMB) called
employees and/or contract workers of plaintiff, as well as those persons the parties to conciliation. The Union stated that it would lift the strike if the
lawfully transacting business with plaintiff at the work places within the thirty (30) Lipercon and D'Rite employees were recalled, and discussion on
bargaining unit referred to in the CBA, ..., to compel plaintiff to hire the their other demands, such as wage distortion and appointment of
employees or workers of LIPERCON and D'RITE; coordinators, were made. Effected eventually was a Memorandum of
Agreement between SanMig and the Union that "without prejudice to the
outcome of G.R. No. 87700 (this case) and Civil Case No. 57055 (the case That a labor dispute, as defined by the law, does exist herein is evident. At
below), the laid-off individuals ... shall be recalled effective 8 May 1989 to bottom, what the Union seeks is to regularize the status of the employees
their former jobs or equivalent positions under the same terms and contracted by Lipercon and D'Rite in effect, that they be absorbed into the
conditions prior to "lay-off" (Annex 15, SanMig Comment). In turn, the Union working unit of SanMig. This matter definitely dwells on the working
would immediately lift the pickets and return to work. relationship between said employees vis-a-vis SanMig. Terms, tenure and
conditions of their employment and the arrangement of those terms are thus
After an exchange of pleadings, this Court, on 12 October 1989, gave due involved bringing the matter within the purview of a labor dispute. Further,
course to the Petition and required the parties to submit their memoranda the Union also seeks to represent those workers, who have signed up for
simultaneously, the last of which was filed on 9 January 1990. Union membership, for the purpose of collective bargaining. SanMig, for its
part, resists that Union demand on the ground that there is no employer-
The focal issue for determination is whether or not respondent Court employee relationship between it and those workers and because the
correctly assumed jurisdiction over the present controversy and properly demand violates the terms of their CBA. Obvious then is that representation
issued the Writ of Preliminary Injunction to the resolution of that question, is and association, for the purpose of negotiating the conditions of employment
the matter of whether, or not the case at bar involves, or is in connection are also involved. In fact, the injunction sought by SanMig was precisely also
with, or relates to a labor dispute. An affirmative answer would bring the to prevent such representation. Again, the matter of representation falls
case within the original and exclusive jurisdiction of labor tribunals to the within the scope of a labor dispute. Neither can it be denied that the
exclusion of the regular Courts. controversy below is directly connected with the labor dispute already taken
cognizance of by the NCMB-DOLE (NCMB-NCR- NS-01- 021-89; NCMB NCR
Petitioners take the position that 'it is beyond dispute that the controversy in NS-01-093-83).
the court a quo involves or arose out of a labor dispute and is directly
connected or interwoven with the cases pending with the NCMB-DOLE, and Whether or not the Union demands are valid; whether or not SanMig's
is thus beyond the ambit of the public respondent's jurisdiction. That the acts contracts with Lipercon and D'Rite constitute "labor-only" contracting and,
complained of (i.e., the mass concerted action of picketing and the reliefs therefore, a regular employer-employee relationship may, in fact, be said to
prayed for by the private respondent) are within the competence of labor exist; whether or not the Union can lawfully represent the workers of
tribunals, is beyond question" (pp. 6-7, Petitioners' Memo). Lipercon and D'Rite in their demands against SanMig in the light of the
existing CBA; whether or not the notice of strike was valid and the strike itself
On the other hand, SanMig denies the existence of any employer-employee legal when it was allegedly instigated to compel the employer to hire
relationship and consequently of any labor dispute between itself and the strangers outside the working unit; — those are issues the resolution of
Union. SanMig submits, in particular, that "respondent Court is vested with which call for the application of labor laws, and SanMig's cause's of action in
jurisdiction and judicial competence to enjoin the specific type of strike the Court below are inextricably linked with those issues.
staged by petitioner union and its officers herein complained of," for the
reasons that: The precedent in Layno vs. de la Cruz (G.R. No. L-29636, 30 April 1965, 13
SCRA 738) relied upon by SanMig is not controlling as in that case there was
A. The exclusive bargaining representative of an employer unit cannot no controversy over terms, tenure or conditions, of employment or the
strike to compel the employer to hire and thereby create an employment representation of employees that called for the application of labor laws. In
relationship with contractual workers, especially were the contractual that case, what the petitioning union demanded was not a change in working
workers were recognized by the union, under the governing collective terms and conditions, or the representation of the employees, but that its
bargaining agreement, as excluded from, and therefore strangers to, the members be hired as stevedores in the place of the members of a rival union,
bargaining unit. which petitioners wanted discharged notwithstanding the existing contract of
the arrastre company with the latter union. Hence, the ruling therein, on the
B. A strike is a coercive economic weapon granted the bargaining basis of those facts unique to that case, that such a demand could hardly be
representative only in the event of a deadlock in a labor dispute over 'wages, considered a labor dispute.
hours of work and all other and of the employment' of the employees in the
unit. The union leaders cannot instigate a strike to compel the employer, As the case is indisputably linked with a labor dispute, jurisdiction belongs to
especially on the eve of certification elections, to hire strangers or workers the labor tribunals. As explicitly provided for in Article 217 of the Labor Code,
outside the unit, in the hope the latter will help re-elect them. prior to its amendment by R.A. No. 6715 on 21 March 1989, since the suit
below was instituted on 6 March 1989, Labor Arbiters have original and
C. Civil courts have the jurisdiction to enjoin the above because this specie exclusive jurisdiction to hear and decide the following cases involving all
of strike does not arise out of a labor dispute, is an abuse of right, and workers including "1. unfair labor practice cases; 2. those that workers may
violates the employer's constitutional liberty to hire or not to hire. (SanMig's file involving wages, hours of work and other terms and conditions of
Memorandum, pp. 475-476, Rollo). employment; ... and 5. cases arising from any violation of Article 265 of this
Code, including questions involving the legality of striker and lockouts. ..."
We find the Petition of a meritorious character. Article 217 lays down the plain command of the law.

A "labor dispute" as defined in Article 212 (1) of the Labor Code includes "any The claim of SanMig that the action below is for damages under Articles 19,
controversy or matter concerning terms and conditions of employment or the 20 and 21 of the Civil Code would not suffice to keep the case within the
association or representation of persons in negotiating, fixing, maintaining, jurisdictional boundaries of regular Courts. That claim for damages is
changing, or arranging the terms and conditions of employment, regardless interwoven with a labor dispute existing between the parties and would have
of whether the disputants stand in the proximate relation of employer and to be ventilated before the administrative machinery established for the
employee." expeditious settlement of those disputes. To allow the action filed below to
prosper would bring about "split jurisdiction" which is obnoxious to the
While it is SanMig's submission that no employer-employee relationship orderly administration of justice (Philippine Communications, Electronics and
exists between itself, on the one hand, and the contractual workers of Electricity Workers Federation vs. Hon. Nolasco, L-24984, 29 July 1968, 24
Lipercon and D'Rite on the other, a labor dispute can nevertheless exist SCRA 321).
"regardless of whether the disputants stand in the proximate relationship of
employer and employee" (Article 212 [1], Labor Code, supra) provided the We recognize the proprietary right of SanMig to exercise an inherent
controversy concerns, among others, the terms and conditions of management prerogative and its best business judgment to determine
employment or a "change" or "arrangement" thereof (ibid). Put differently, whether it should contract out the performance of some of its work to
and as defined by law, the existence of a labor dispute is not negative by the independent contractors. However, the rights of all workers to self-
fact that the plaintiffs and defendants do not stand in the proximate relation organization, collective bargaining and negotiations, and peaceful concerted
of employer and employee. activities, including the right to strike in accordance with law (Section 3,
Article XIII, 1987 Constitution) equally call for recognition and protection.
Those contending interests must be placed in proper perspective and With the failure of conciliation conferences between petitioner and the
equilibrium. strikers, INPORT filed a complaint before the Labor Arbiter for Illegal Strike
with prayer for a restraining order/preliminary injunction.
WHEREFORE, the Writ of certiorari is GRANTED and the Orders of respondent
Judge of 25 March 1989 and 29 March 1989 are SET ASIDE. The Writ of On May 7, 1985, the National Labor Relations Commission issued a
Prohibition is GRANTED and respondent Judge is enjoined from taking any temporary restraining order. Thereafter, majority of the strikers returned to
further action in Civil Case No. 57055 except for the purpose of dismissing it. work, leaving herein private respondents who continued their protest.2
The status quo ante declaration of strike ordered by the Court on 24 May
1989 shall be observed pending the proceedings in the National Conciliation Counsel for private respondents filed a manifestation that petitioner required
Mediation Board-Department of Labor and Employment, docketed as NCMB- prior screening conducted by the MLU-FFW before the remaining strikers
NCR-NS-01-02189 and NCMB-NCR-NS-01-093-83. No costs. could be accepted back to work.
SO ORDERED.
Meanwhile, counsel for the Macajalar Labor Union (MLU-FFW) filed a
G.R. No. 103560 July 6, 1995 "Motion to Drop Most of the Party Respondents From the Above Entitled
Case." The 278 employees on whose behalf the motion was filed, claimed
GOLD CITY INTEGRATED PORT SERVICE, INC. (INPORT), petitioner, that they were duped or tricked into signing the individual notices of strike.
vs. After discovering this deception and verifying that the strike was staged by a
NATIONAL LABOR RELATIONS COMMISSION (Fifth Division) ADELO EBUNA, minority of the union officers and members and without the approval of, or
EMMANUEL VALMORIDA, RODOLFO PEREZ, ROGER ZAGADO, MARCOS consultation with, majority of the union members, they immediately
GANZAN, AND REY VALLE, (WILFREDO DAHAN, ROGELIO VILLAFUERTE, withdrew their notice of strike and returned to work.
WILFREDO AMPER, RICARDO ABA, YOLITO AMBUS, FIDEL CALIO, VICENTE
CAHATOL, SOTECO CUENCA, NICOLAS DALAGUAN, BALBINO FAJARDO, The petitioner INPORT, not having interposed any objection, the Labor
ROLANDO JAMILA, RICARDO LAURETO, RUDY LAURETO, QUIRICO LEJANIO, Arbiter, in his decision dated July 23, 1985, granted their prayer to be
OSCAR LAPINIG, FELIPE LAURETE, JESUSTUDY OMISOL, ZOSIMO OMISOL, excluded as respondents in the complaint for illegal strike. Moreover,
PEDRO SUAREZ, SATURNINO SISIBAN and MANUEL YANEZ), respondents. petitioner's complaint was directed against the 31 respondents who did not
return to work and continued with the strike.
G.R. No. 103599 July 6, 1995
For not having complied with the formal requirements in Article 264 of the
ADELO EBUNA, WILFREDO DAHAN, RICARDO LAURETO, REY VALLE, VICENTE Labor Code,3 the strike staged by petitioner's workers on April 30, 1985 was
CAHATOL, MARCOS GANZAN, RODOLFO PEREZ, ROEL SAA, ROGELIO found by the Labor Arbiter to be illegal.4 The workers who participated in the
VILLAFUERTE, MANUEL YANEZ, WILFREDO AMPER, QUIRECO LEJANO, illegal strike did not, however, lose their employment, since there was no
EMMANUEL VALMORIA, ROLANDO JAMILLA, NICOLAS DALAGUAN, BALBINO evidence that they participated in illegal acts. After noting that petitioner
FAJARDO, PEDRO SUAREZ, ELPIDIO ESTROGA, RUBEN PAJO, JESUSTODY accepted the other striking employees back to work, the Labor Arbiter held
OMISOL, RICARDO ABA, FIDEL CALIO, SATURNINO SESYBAN, RUDY LAURETO, that the private respondents should similarly be allowed to return to work
OSCAR LAPINIG, FELIPE LAURENTE, ROGER ZAGADO, SOTECO CUENCA, FIDEL without having to undergo the required screening to be undertaken by their
ESLIT, ZOSIMO OMISOL, ANGEL BERNIDO, and MICHAEL YAGOTYOT, union (MLU-FFW).
petitioners,
vs. As regards the six private respondents who were union officers, the Labor
NATIONAL LABOR RELATIONS COMMISSION, FIFTH DIVISION, and GOLD CITY Arbiter ruled that they could not have possibly been "duped or tricked" into
INTEGRATED PORT SERVICES, INC. (INPORT), respondents. 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
ROMERO, J.: herein petitioner.5

Should separation pay and backwages be awarded by public respondent The dispositive portion of the decision reads:
NLRC to participants of an illegal strike? This is the core issue to be decided in
these two petitions. 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
Gold City Integrated Port Service, Inc. (INPORT) filed a petition for certiorari ILLEGAL contrary to Article 264 of the Labor Code, as amended. Our
against the National Labor Relations Commission (NLRC) assailing the latter's conclusion on the employment status of the illegal strikers is subject to our
decision in "Gold City Integrated Port Services, Inc. v. Adelo Ebuna, et al." discussion above.6
(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 Both petitioner and private respondents filed motions for reconsideration,
where the petitioners are the private respondents in instant case and the which public respondent NLRC treated as appeals.7
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 On January 14, 1991, the NLRC affirmed with modification8 the Arbiter's
private respondents. 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
Instant case arose from the following facts: officers, should also be allowed to work unconditionally to avoid
discrimination. However, in view of the strained relations between the
Early in the morning of April 30, 1985, petitioner's employees stopped parties, separation pay was awarded in lieu of reinstatement. The decretal
working and gathered in a mass action to express their grievances regarding portion of the Resolution reads:
wages, thirteenth month pay and hazard pay. Said employees were all
members of the Macajalar Labor Union — Federation of Free Workers (MLU- WHEREFORE, the decision appealed from is Affirmed with modification in
FFW) with whom petitioner had an existing collective bargaining agreement. accordance with the foregoing resolution. Complainant INPORT is hereby
ordered, in lieu of reinstatement, to pay respondents the equivalent of
Petitioner was engaged in stevedoring and arrastre services at the port of twelve (12) months salaries each as separation pay. Complainant is further
Cagayan de Oro. The strike paralyzed operations at said port. ordered to pay respondents two (2) years backwages based on their last
salaries, without qualification or deduction. The appeal of complainant
On the same morning, the strikers filed individual notices of strike INPORT is Dismissed for lack of merit.9
("Kaugalingon nga Declarasyon sa Pag-Welga") with the then Ministry of
Labor and Employment. Upon petitioner's motion for reconsideration, public respondent modified the
above resolution on December 12, 1991. 10
As we stated in the case of National Federation of Sugar Workers v. Ovejera,
The Commission ruled that since private respondents were not actually 17 the language of the law leaves no room for doubt that the cooling-off
terminated from service, there was no basis for reinstatement. However, it period and the seven-day strike ban after the strike-vote report were
awarded six months' salary as separation pay or financial assistance in the intended to be mandatory. 18
nature of "equitable relief." The award for backwages was also deleted for
lack of factual and legal basis. In lieu of backwages, compensation equivalent Article 265 of the Labor Code reads, inter alia:
to P1,000.00 was given.
(i)t SHALL be unlawful for any labor organization . . . to declare a strike . . .
The dispositive portion of the assailed Resolution reads: without first having filed the notice required in the preceding Article or
without the necessary strike vote first having been obtained and reported to
WHEREFORE, the resolution of January 14, 1991 is Modified reducing the the Ministry. (Emphasis ours)
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, In explaining the above provision, we said:
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 In requiring a strike notice and a cooling-off period, the avowed intent of the
thereof, respondents are granted compensation for their sudden loss of law is to provide an opportunity for mediation and conciliation. It thus directs
employment in the sum of P1,000.00 each. The motion of respondents to the MOLE to exert all efforts at mediation and conciliation to effect a
implead PPA as third-party respondent is Noted. Except for this modification voluntary settlement' during the cooling-off period. . . .
the rest of the decision sought to be reconsidered shall stand. 11
xxx xxx xxx
In the instant petitions for certiorari, petitioner alleges that public
respondent Commission committed grave abuse of discretion in awarding The cooling-off period and the 7-day strike ban after the filing of a strike-vote
private respondents separation pay and backwages despite the declaration report, as prescribed in Art. 264 of the Labor Code, are reasonable
that the strike was illegal. restrictions and their imposition is essential to attain the legitimate policy
objectives embodied in the law. We hold that they constitute a valid exercise
On the other hand, private respondents, in their petition, assail the reduction of the police power of the state. 19
of separation pay and deletion of backwages by the NLRC as constituting
grave abuse of discretion. 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.
They also allege that the Resolution of January 14, 1991 could not be
reconsidered after the unreasonable length of time of eleven months. 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
Before proceeding with the principal issues raised by the parties, it is participate therein.
necessary to clarify public respondent's statements concerning the strike
staged by INPORT's employees. 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
In its resolution dated January 14, 1991, the NLRC held that the facts during a strike may be declared to have lost their employment status. 20 An
prevailing in the case at bench require a relaxation of the rule that the formal ordinary striking worker cannot be terminated for mere participation in an
requisites for a declaration of a strike are mandatory. Furthermore, what the illegal strike. There must be proof that he committed illegal acts during a
employees engaged in was more of a spontaneous protest action than a strike. A union officer, on the other hand, may be terminated from work
strike. 12 when he knowingly participates in an illegal strike, and like other workers,
when he commits an illegal act during a strike.
Nevertheless, the Commission affirmed the Labor Arbiter's decision which
declared the strike illegal. In the case at bench, INPORT accepted the majority of the striking workers,
including union officers, back to work. Private respondents were left to
A strike, considered as the most effective weapon of labor, 13 is defined as continue with the strike after they refused to submit to the "screening"
any temporary stoppage of work by the concerted action of employees as a required by the company. 21
result of an industrial or labor dispute. 14 A labor dispute includes any
controversy or matter concerning terms or conditions of employment or the The question to be resolved now is what these remaining strikers, considering
association or representation of persons in negotiating, fixing, maintaining, the circumstances of the case, are entitled to receive under the law, if any.
changing or arranging the terms and conditions of employment, regardless of
whether or not the disputants stand in the proximate relation of employers Are they entitled, as they claim, to reinstatement or separation pay and
and employees. 15 backwages?

Private respondents and their co-workers stopped working and held the mass In his decision, the Labor Arbiter ordered INPORT to reinstate/accept the
action on April 30, 1985 to press for their wages and other benefits. What remaining workers as well as to accept the remaining union officers after the
transpired then was clearly a strike, for the cessation of work by concerted latter sought reconsideration from INPORT. 22
action resulted from a labor dispute.
The NLRC on January 14, 1991, modified the above decision by ordering
The complaint before the Labor Arbiter involved the legality of said strike. INPORT to pay private respondents the equivalent of twelve months in salary
The Arbiter correctly ruled that the strike was illegal for failure to comply with as separation pay in lieu of reinstatement and two years' backwages. 23
the requirements of Article 264 (now Article 263) paragraphs (c) and (f) of the
Labor Code. 16 On reconsideration, public respondent modified its original award and
reduced the separation pay to six months, deleted the award for backwages
The individual notices of strike filed by the workers did not conform to the and instead awarded P1,000.00 as compensation for their sudden loss of
notice required by the law to be filed since they were represented by a union employment. 24
(MLU-FFW) which even had an existing collective bargaining agreement with
INPORT. Under the law, an employee is entitled to reinstatement and to his full
backwages when he is unjustly dismissed. 25
Neither did the striking workers observe the strike vote by secret ballot,
cooling-off period and reporting requirements. 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 No backwages will be awarded to private respondent-union members as a
instance, to strained relations between employer and employee. penalty for their participation in the illegal strike. Their continued
participation in said strike, even after most of their co-workers had returned
It is also given as a form of financial assistance when a worker is dismissed in to work, can hardly be rewarded by such an award.
cases such as the installation of labor saving devices, redundancy,
retrenchment to prevent losses, closing or cessation of operation of the The fate of private respondent-union officers is different. Their insistence on
establishment, or in case the employee was found to have been suffering unconditional reinstatement or separation pay and backwages is
from a disease such that his continued employment is prohibited by law. 27 unwarranted and unjustified. For knowingly participating in an illegal strike,
the law mandates that a union officer may be terminated from employment.
Separation pay is a statutory right defined as the amount that an employee 34
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 Notwithstanding the fact that INPORT previously accepted other union
looking for another employment. 28 It is oriented towards the immediate officers and that the screening required by it was uncalled for, still it cannot
future, the transitional period the dismissed employee must undergo before be gainsaid that it possessed the right and prerogative to terminate the union
locating a replacement job. 29 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
Hence, an employee dismissed for causes other than those cited above is not having lost his employment. 35
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 Moreover, an illegal strike which, more often than not, brings about
for causes other than serious misconduct or those reflecting on his moral unnecessary economic disruption and chaos in the workplace should not be
character. 31 countenanced by a relaxation of the sanctions prescribed by law.

Backwages, on the other hand, is a form of relief that restores the income The union officers are, therefore, not entitled to any relief.
that was lost by reason of unlawful dismissal. 32
However, the above disquisition is now considered moot and academic and
It is clear from the foregoing summary of legal provisions and jurisprudence cannot be effected in view of a manifestation filed by INPORT dated May 15,
that there must generally be unjust or illegal dismissal from work, before 1987. 36 In said Manifestation, it attached a Certification by the President of
reinstatement and backwages may be granted. And in cases where the Macajalar Labor Union (MLU-FFW) to the effect that the private
reinstatement is not possible or when dismissal is due to valid causes, respondents/remaining strikers have ceased to be members of said union.
separation pay may be granted. 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:
Private respondents contend that they were terminated for failure to submit
to the controversial "screening" requirement. 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
Public respondent Commission took the opposite view and held: corporation, upon proper notice of such fact made by the latter; provided,
however, . . . after they shall have received the regular appointment as a
As the evidence on record will show, respondents were not actually condition for his continued employment with the corporation. . . . 37
terminated from the service. They were merely made to submit to a
screening committee as a prerequisite for readmission to work. While this Since private respondents (union members) are no longer members of the
condition was found not wholly justified, the fact remains that respondents MLU, they cannot be reinstated. In lieu of reinstatement, which was a proper
who are resistant to such procedure are partly responsible for the delay in remedy before May 1987 when they were dismissed from the union, we
their readmission back to work. Thus, We find justifiable basis in further award them separation pay. We find that to award one month salary for
modifying our resolution of January 14, 1991 in accordance with the equities every year of service until 1985, after April of which year they no longer
of the case. formed part of INPORT's productive work force partly through their own
fault, is a fair settlement.
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. Finally, there is no merit in INPORT's statement that a Resolution of the NLRC
Normally, severance benefit is granted as an alternative remedy to cannot be modified upon reconsideration after the lapse of an unreasonable
reinstatement. And since there is no dismissal to speak of, there is no basis period of time. Under the present circumstances, a period of eleven months
for awarding reinstatement as a legal remedy. In lieu thereof, We shall grant is not an unreasonable length of time. The Resolution of the public
herein respondents separation pay as and by way of financial assistance in respondent dated January 14, 1991 did not acquire finality in view of the
the nature of an "equitable relief". 33 timely filing of a motion for reconsideration. Hence, the Commission's
modified Resolution issued on December 12, 1991 is valid and in accordance
We find that private respondents were indeed dismissed when INPORT with law.
refused to accept them back to work after the former refused to submit to
the "screening" process. 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
Applying the law (Article 264 of the Labor Code) which makes a distinction, showing of illegal dismissal. However, while the union members may thus be
we differentiate between the union members and the union officers among entitled under the law to be reinstated or to receive separation pay, their
private respondents in granting the reliefs prayed for. expulsion from the union in accordance with the collective bargaining
agreement renders the same impossible.
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 The NLRC's award of separation pay as "equitable relief" and P1,000.00 as
commits illegal acts during a strike that he may be declared to have lost his compensation should be deleted, these being incompatible with our findings
employment status. Since there appears no proof that these union members detailed above.
committed illegal acts during the strike, they cannot be dismissed. The
striking union members among private respondents are thus entitled to WHEREFORE, from the foregoing premises, the petition in G.R. No. 103560
reinstatement, there being no just cause for their dismissal. ("Gold City Integrated Port Service Inc. v. National Labor Relations
Commission, et al.") is GRANTED. One month salary for each year of service
However, considering that a decade has already lapsed from the time the until 1985 is awarded to private respondents who were not union officers as
disputed strike occurred, we find that to award separation pay in lieu of separation pay. The petition in G.R. No. 103599 ("Adelo Ebuna, et al. v.
reinstatement would be more practical and appropriate.
National Labor Relations Commission, et al.") is DISMISSED for lack of merit. true that labor cases, especially those involving claims for compensation due
No costs. the workers, must be resolved on the basis of all material facts, and it is the
inescapable duty of all parties concerned, including the court, to disregard all
SO ORDERED. technical rules in barring1 and discovering them, on the other hand, it is as
important that said cases must be decided on time for the obvious reason
G.R. No. L-37662 July 15, 1975 that the claimants are not in a position to engage in any long drawn
proceedings without risking either their wherewithal or their convictions. The
RADIO COMMUNICATIONS OF THE PHILIPPINES, INC. (RCPI), petitioner, Courts cannot leave the progress of the case to the convenience of the
vs. parties, particularly, the employer who can afford to keep it dragging.
PHILIPPINE COMMUNICATIONS ELECTRONICS & ELECTRICITY WORKERS' Accordingly, where the inquiry into the material facts is unreasonably delayed
FEDERATION (FCWF), RADIO COMMUNICATIONS OF THE PHILIPPINES, INC. by unwarranted and unexplained actuations of any of the parties, no abuse of
EMPLOYEES UNION (RCPIEU), COURT OF INDUSTRIAL RELATIONS (CIR), and discretion is committed by the court if it deems the right of such offending
SPECIAL SHERIFF OF THE COURT OF INDUSTRIAL RELATIONS, respondents. party to present his factual side of the issue waived.

RESOLUTION This is particularly true in the case at bar, for, as the record shows, the order
of reinstatement which has remained unobeyed by petitioner to this day was
issued more than seven years ago and was in fact already nearing five years
BARREDO, J.: old when the above-quoted order of February 15, 1973 had to be issued in
exasperation by respondent court. The duty of the court spoken of in Ang
Three incidents arising from Our decision in this case dated August 30, 1974: Tibay to ferret out all facts necessary for the just determination of the rights
(1) Motion for reconsideration filed by petitioner; (2) Manifestation and of the parties without regard to technical rules ceases when the court is
motion for intervention of United RCPI Communications Labor Association- disabled by the very indifference and inattention, if not disregard, of a party
Philippine Association of Free Labor Unions (URCPICLA- PAFLU); and (3) of the orders of the court designed to expedite proceedings already being
Prayer for a modified judgment filed by respondent union, Philippine protracted through maneuvers of the same party.
Communications, Electronics & Electricity Workers' Federation, RCPI
Employees' Union (RCPIEU). Besides, it is noteworthy that petitioner did not even care to move for the
reconsideration of the order in question. Taking the court for granted, it
I merely went ahead and made its required offer of evidence, at long last,
eighteen days late. If only to make all and sundry understand that no one can
In its motion for reconsideration, petitioner suggests that Our decision did thus trifle with the court with impunity, petitioner should suffer the
not resolved squarely the issue of whether or not respondent Industrial Court consequences of its patent lack of diligence in the protection of its interest
gravely abused its discretion in declaring petitioner, by its order of February which it has coupled with inexplicable failure to accord the orders of the
15, 1973, as having waived its right to make an offer of its evidence and in court due attention, considering it was undertaking a task of vital public
forthwith considering the matter of the implementation of the return-to- interest, the implementation of a peremptory return-to-work order it had
work order of April 23, 1968 as directed in the writ of execution of December issued five years back.
29, 1969 submitted for resolution. It is claimed that this issue is pivotal, for if
it is resolved in its favor, the ordered reinstatement of the 167 employees and It is of no consequence that respondent union's motion to strike out the offer
workers enumerated in respondent court's order of October 5, 1973 may not of evidence belatedly filed by petitioner was not resolved by respondent
be complied with until after the issues of fact regarding their identity and court. The fact of the matter is that said offer had already been deemed
status as such workers and employees have been reviewed and passed upon waived by the court. Procedurally, therefore, there was no need to strike out
in the light of the evidence offered by petitioner at the hearing. Petitioner something that had not been included legally in the record.
invokes Section 20 of Commonwealth Act 103 together with this Court's
injunction in Ang Tibay vs. CIR, 69 Phil. 365, that the industrial Court must In view of the foregoing considerations, and for the reason that the
"use the authorized legal methods of securing evidence and informing itself arguments of petitioner relative to Presidential Decree No. 21 have been
of acts material and relevant to the controversy" in seeing to it "that the law more than adequately discussed in Our decision, petitioner's motion is
is enforced." In other words, petitioner submits that in ignoring or refusing to denied for lack of merit.
take into account evidence already in the record albeit not duly offered,
respondent court sacrificed substance for technicality. II

In this connection, it may be well to bear in mind, that the reasons why The motion to intervene of URCPICLA-PAFLU is likewise without merit. Aside
respondent court felt compelled to act as it did are explained in its order of from the fact that it had already intervened in the court below but later on
February 15, 1973 thus: did nothing to protect its pretended rights relative to the orders assailed
here, on the merits, its position suffers from the same fatal defect of the
All these aforestated pleadings were set for hearing on January 29, 1973. motion for reconsideration of petitioner in that it is premised on erroneous
After the parties made clear their respective positions on the issues involved, assumptions regarding the objective and purpose of Presidential Decree No.
the Court gave the counsel for respondent until February 3, 1973 within 21. The members of movant union were hired or employed by petitioner in
which to submit his offer of exhibits in writing and the counsel for petitioner open violation of the order of reinstatement of the Industrial Court and as
three (3) days after receipt of the offer in writing within which to file his such they cannot have any legal standing as employees protected by said
objections. Both counsel were also given by the Court ten (10) days from Presidential Decree. It would be absurd if an employer were to be required to
submission of the objection within which to submit simultaneous seek prior clearance from the Department of Labor before he can layoff
memoranda (t. s. n., pp. 2-6, Jan. 29, 1973). workers he has hired as substitutes for strikers subsequently ordered
reinstated by the courts, particularly if the employer has, as in the instant
Considering that February 3, 1973, had already lapsed without respondents case, hired said substitutes in violation of a restraining order not to hire
having as yet submitted its offer of exhibits, despite the so many chances anyone without the permission of the court. The motion to intervene is,
given to it, there is now valid reason to grant the urgent motion of petitioner. therefore, denied.
(Page 58, Rollo.)
III
As We have said in Our decision, "(a) bare recital of the above facts renders
undeniable the far-from-commendable efforts of petitioner to set at naught a It is the plea of respondent unions for modification of Our decision that
return-to-work order. Considering that it is of a peremptory character and its deserves favorable consideration. The prayer is for Us to include in the
execution was long overdue, the challenged actuation of respondent court judgment an award of backwages to the employees and laborers concerned,
had all the earmarks of legality." It is not true then that We have not resolved in addition to their immediate reinstatement. The plea is opposed by
the issue referred to. Indeed, all that need be added here is that while it is petitioner upon the ground that the issue of payment of backwages was
neither raised in nor passed upon by the Industrial Court and is, in fact, not determining the earnings of the laid-off employees ordered to be reinstated
even touched in the previous pleadings of the parties in the instant case. with backwages during the pendency of the case for purposes of deducting
Additionally, it is averred that the matter is now actually being looked into by the same from the gross backwages awarded.
the National Labor Relations Board, hence it is not necessary for this Court to
take it up. As has been noted, this formula of awarding reasonable net backwages
without deduction or qualification relieves the employees from proving or
We are of the considered opinion that, indeed, the award prayed for is in disproving their earnings during their lay-off and the employers from
order. The fact that nothing was done in the court below about it is not a submitting counterproofs, and obviates the twin evils of idleness on the part
valid objection to the granting thereof. Neither can its denial be justified just of the employee who would "with folded arms, remain inactive in the
because it was not expressly demanded by respondents before Our decision expectation that a windfall would come to him" (Itogon Suyoc Mines, Inc. vs.
was handed down. Such award is such a logical and inescapable consequence Sangilo-Itogon Workers Union, 24 SCRA 873 (1968), cited in Diwa ng
of the order of reinstatement that actually one is incomplete without the Pagkakaisa vs. Filtex International Corp., 43 SCRA 287 (1972) per Makalintal,
other. now C.J.) and attrition and protracted delay in satisfying such award on the
part of unscrupulous employers who have seized upon the further
We are not dealing here with backwages to be paid to workers who are being proceedings to determine the actual earnings of the wrongfully dismissed or
ordered reinstated as a consequence of a finding by the court that their laid-off employees to hold unduly extended hearings for each and every
suspension or dismissal by their employer is illegal, which, of course, is employee awarded backwages and thereby render practically nugatory such
dependent on the sound discretion of the court. (Union of Philippine award and compel the employees to agree to unconscionable settlements of
Education Employees vs. Philippine Education Company, 91 Phil. 93.) In the their backwages award in order to satisfy their dire need. See La Campana
present instance, what is involved is a failure to comply with, nay a veiled Food Products, Inc. vs. CIR, 28 SCRA 314 (1969) and Kaisahan ng Mga
defiance by respondent of a return-to-work order of the Industrial Court Manggagawa vs. La Campana Food Products, Inc., 36 SCRA 142
issued seven years ago. Worse, from all appearances, such continued (1970).1äwphï1.ñët
resistance of petitioner to said peremptory order can hardly evoke sympathy.
To begin with, its attempt to question the identity of those entitled to This formula of making a flat award for a given period has been adopted in
reinstatement claiming that they were not actually in their employ at the subsequent cases.3 Accordingly, each of the 167 members of respondent
time of the declaration of the strike sounds hollow. It is inconceivable that unions named in the decision under review and found by the Industrial Court
strangers and outsiders would try to be taken in such a surreptitious manner. to be entitled to reinstatement should be paid backwages for two years,
Neither can the allegation that petitioner has presented evidence of without any deduction or qualification, at the respective rates of
abandonment prior to the strike and of resignations subsequent thereto be compensation they were receiving at the time of the strike, November 17,
of help to petitioner. Voluntary abandonment of work before a strike is too 1967. It goes without saying that all those who can be shown by incontestible
unusual to be readily credible whereas purported resignations after a strike evidence to have died prior to the date of the strike shall be disregarded, but
and during the pendency of protracted reinstatement proceedings are at the heirs of those who have died after the strike shall receive the respective
least suspect and do not affect the employee status of the persons proportional amounts due their predecessors-in-interest as of the time of
concerned, unless there is patent evidence that the pretended abandonment death, if the same occurred less than two years from the date of the strike,
or resignation was due to another employment.2 Moreover, the proceedings and the full two-years backwages, if after two years from said date. Any
below had been stalled by transparent dilatory moves of petitioner which are amount paid by reason or on the occasion of supposed resignations after the
basically irreconcilable with the attitude of cooperativeness and obedience strike shall not be deducted.
an employer is expected to maintain at all times towards orders of the court
issued by virtue of powers expressly granted to it by law. (Section 10, Before closing, it must be mentioned that the Court understands that
Republic Act 875; Section 19, Commonwealth Act 103.) notwithstanding that its decision of August 30, 1974 is immediately
executory, the employees concerned have not yet been reinstated up to now.
The Industrial Court had no discretion in the matter. There was no Petitioner is warned that the pendency of the present incidents is no excuse
controversial issue of fault it had to decide. It was a plain case of exacting the for its failure to comply immediately with said decision and appropriate
most natural sanction for a defiance of its order. If it overlooked the award, action would have to be taken to protect the dignity of the court, if such
seemingly engrossed as it was in resolving the issue of identity of the strikers attitude continues.
raised by petitioner, that was plain error which it is within Our prerogative to
correct motu propio, as We do in appeals by writ of error in respect to a WHEREFORE, the motion for reconsideration of petitioner dated September
manifest error not assigned nor discussed by appellant in his brief. (Section 7, 16, 1974 as well as the motion to intervene of URCPICLA-PAFLU of October
Rule 51.) Employees and workers deprived of their means of livelihood in 16, 1974 are both denied for lack of merit. On the other hand, the motion of
defiance of a judicial order the legality of which is beyond dispute do not respondent RCPIEU of November 6, 1974 for modification of judgment is
have to remind the court of their right to get compensated of their lost granted, if only to complete Our decision, which cannot be final without such
earnings upon their actual reinstatement. Award thereof should come as a award being included therein. Petitioner is ordered to pay the 167 employees
matter of course. For us not to rule on this point now only to leave it for and workers of petitioner enumerated in the lndustrial Court's order of
action by the National Labor Relations Board and thereby give rise to another October 5,1973 backwages for two years, without any deduction or
possible appeal to Us is to unnecessarily lengthen even more the tortuous qualification, pursuant to the tenor of the above opinion. This resolution is
road already travelled by respondents in their effort to get what has been also immediately executory.
rightfully due them since years ago. We would be recreant to our
constitutional duty to give protection to labor that way. Antonio, Aquino and Concepcion Jr., JJ., concur.

IV KIOK LOY, doing business under the name and style SWEDEN ICE CREAM
PLANT, petitioner,
Taking all circumstances of this case into account, We find no justifiable vs.
reason why We cannot apply here in respect to the amount of the award the NATIONAL LABOR RELATIONS COMMISSION (NLRC) and PAMBANSANG
ruling in Feati University Club vs. Feati University, G. R. No. L-35103, Aug. 15, KILUSAN NG PAGGAWA (KILUSAN), respondents.
1974, wherein We said:
Ablan and Associates for petitioner.
As to the amount of backwages, the Court applies the precedent recently set
in Mercury Drug Co. vs. CIR (L-23357, April 30, 1974, applied in NASSCO vs. Abdulcadir T. Ibrahim for private respondent.
CIR, L-31852 & L-32724, June 28, 1974 and Almira, et al vs. B. F. Goodrich
Phil., Inc., L-34974, July 25, 1974.) of fixing the amount of backwages to a just
and reasonable level without qualification or deduction so as to avoid CUEVAS, J.:
protracted delay in the execution of the award for backwages due to
extended hearings and unavoidable delays and difficulties encountered in
Petition for certiorari to annul the decision 1 of the National Labor Relations
Commission (NLRC) dated July 20, 1979 which found petitioner Sweden Ice Petitioner now comes before Us assailing the aforesaid decision contending
Cream guilty of unfair labor practice for unjustified refusal to bargain, in that the National Labor Relations Commission acted without or in excess of
violation of par. (g) of Article 2492 of the New Labor Code, 3 and declared the its jurisdiction or with grave abuse of discretion amounting to lack of
draft proposal of the Union for a collective bargaining agreement as the jurisdiction in rendering the challenged decision. On August 4, 1980, this
governing collective bargaining agreement between the employees and the Court dismissed the petition for lack of merit. Upon motion of the petitioner,
management. however, the Resolution of dismissal was reconsidered and the petition was
given due course in a Resolution dated April 1, 1981.
The pertinent background facts are as follows:
Petitioner Company now maintains that its right to procedural due process
In a certification election held on October 3, 1978, the Pambansang Kilusang has been violated when it was precluded from presenting further evidence in
Paggawa (Union for short), a legitimate late labor federation, won and was support of its stand and when its request for further postponement was
subsequently certified in a resolution dated November 29, 1978 by the denied. Petitioner further contends that the National Labor Relations
Bureau of Labor Relations as the sole and exclusive bargaining agent of the Commission's finding of unfair labor practice for refusal to bargain is not
rank-and-file employees of Sweden Ice Cream Plant (Company for short). The supported by law and the evidence considering that it was only on May 24,
Company's motion for reconsideration of the said resolution was denied on 1979 when the Union furnished them with a copy of the proposed Collective
January 25, 1978. Bargaining Agreement and it was only then that they came to know of the
Union's demands; and finally, that the Collective Bargaining Agreement
Thereafter, and more specifically on December 7, 1978, the Union furnished 4 approved and adopted by the National Labor Relations Commission is
the Company with two copies of its proposed collective bargaining unreasonable and lacks legal basis.
agreement. At the same time, it requested the Company for its counter
proposals. Eliciting no response to the aforesaid request, the Union again The petition lacks merit. Consequently, its dismissal is in order.
wrote the Company reiterating its request for collective bargaining
negotiations and for the Company to furnish them with its counter proposals. Collective bargaining which is defined as negotiations towards a collective
Both requests were ignored and remained unacted upon by the Company. agreement,6 is one of the democratic frameworks under the New Labor
Code, designed to stabilize the relation between labor and management and
Left with no other alternative in its attempt to bring the Company to the to create a climate of sound and stable industrial peace. It is a mutual
bargaining table, the Union, on February 14, 1979, filed a "Notice of Strike", responsibility of the employer and the Union and is characterized as a legal
with the Bureau of Labor Relations (BLR) on ground of unresolved economic obligation. So much so that Article 249, par. (g) of the Labor Code makes it an
issues in collective bargaining. 5 unfair labor practice for an employer to refuse "to meet and convene
promptly and expeditiously in good faith for the purpose of negotiating an
Conciliation proceedings then followed during the thirty-day statutory agreement with respect to wages, hours of work, and all other terms and
cooling-off period. But all attempts towards an amicable settlement failed, conditions of employment including proposals for adjusting any grievance or
prompting the Bureau of Labor Relations to certify the case to the National question arising under such an agreement and executing a contract
Labor Relations Commission (NLRC) for compulsory arbitration pursuant to incorporating such agreement, if requested by either party.
Presidential Decree No. 823, as amended. The labor arbiter, Andres Fidelino,
to whom the case was assigned, set the initial hearing for April 29, 1979. For While it is a mutual obligation of the parties to bargain, the employer,
failure however, of the parties to submit their respective position papers as however, is not under any legal duty to initiate contract negotiation.7 The
required, the said hearing was cancelled and reset to another date. mechanics of collective bargaining is set in motion only when the following
Meanwhile, the Union submitted its position paper. The Company did not, jurisdictional preconditions are present, namely, (1) possession of the status
and instead requested for a resetting which was granted. The Company was of majority representation of the employees' representative in accordance
directed anew to submit its financial statements for the years 1976, 1977, with any of the means of selection or designation provided for by the Labor
and 1978. Code; (2) proof of majority representation; and (3) a demand to bargain
under Article 251, par. (a) of the New Labor Code . ... all of which
The case was further reset to May 11, 1979 due to the withdrawal of the preconditions are undisputedly present in the instant case.
Company's counsel of record, Atty. Rodolfo dela Cruz. On May 24, 1978, Atty.
Fortunato Panganiban formally entered his appearance as counsel for the From the over-all conduct of petitioner company in relation to the task of
Company only to request for another postponement allegedly for the negotiation, there can be no doubt that the Union has a valid cause to
purpose of acquainting himself with the case. Meanwhile, the Company complain against its (Company's) attitude, the totality of which is indicative of
submitted its position paper on May 28, 1979. the latter's disregard of, and failure to live up to, what is enjoined by the
Labor Code — to bargain in good faith.
When the case was called for hearing on June 4, 1979 as scheduled, the
Company's representative, Mr. Ching, who was supposed to be examined, We are in total conformity with respondent NLRC's pronouncement that
failed to appear. Atty. Panganiban then requested for another postponement petitioner Company is GUILTY of unfair labor practice. It has been indubitably
which the labor arbiter denied. He also ruled that the Company has waived established that (1) respondent Union was a duly certified bargaining agent;
its right to present further evidence and, therefore, considered the case (2) it made a definite request to bargain, accompanied with a copy of the
submitted for resolution. proposed Collective Bargaining Agreement, to the Company not only once
but twice which were left unanswered and unacted upon; and (3) the
On July 18, 1979, labor arbiter Andres Fidelino submitted its report to the Company made no counter proposal whatsoever all of which conclusively
National Labor Relations Commission. On July 20, 1979, the National Labor indicate lack of a sincere desire to negotiate. 8 A Company's refusal to make
Relations Commission rendered its decision, the dispositive portion of which counter proposal if considered in relation to the entire bargaining process,
reads as follows: may indicate bad faith and this is specially true where the Union's request for
a counter proposal is left unanswered. 9 Even during the period of
WHEREFORE, the respondent Sweden Ice Cream is hereby declared guilty of compulsory arbitration before the NLRC, petitioner Company's approach and
unjustified refusal to bargain, in violation of Section (g) Article 248 (now attitude-stalling the negotiation by a series of postponements, non-
Article 249), of P.D. 442, as amended. Further, the draft proposal for a appearance at the hearing conducted, and undue delay in submitting its
collective bargaining agreement (Exh. "E ") hereto attached and made an financial statements, lead to no other conclusion except that it is unwilling to
integral part of this decision, sent by the Union (Private respondent) to the negotiate and reach an agreement with the Union. Petitioner has not at any
respondent (petitioner herein) and which is hereby found to be reasonable instance, evinced good faith or willingness to discuss freely and fully the
under the premises, is hereby declared to be the collective agreement which claims and demands set forth by the Union much less justify its opposition
should govern the relationship between the parties herein. thereto. 10

SO ORDERED. (Emphasis supplied)


The case at bar is not a case of first impression, for in the Herald Delivery
Carriers Union (PAFLU) vs. Herald Publications 11 the rule had been laid down GRIÑO-AQUINO, J.:p
that "unfair labor practice is committed when it is shown that the respondent
employer, after having been served with a written bargaining proposal by the This petition for certiorari with prayer for the issuance of a temporary
petitioning Union, did not even bother to submit an answer or reply to the restraining order impugns the Decision dated May 19, 1990 of the Voluntary
said proposal This doctrine was reiterated anew in Bradman vs. Court of Arbitrator, Alfredo C. Olvida, in "Association or Trade Unions (ATU-TUCP) vs.
Industrial Relations 12 wherein it was further ruled that "while the law does Davao Integrated Port and Stevedoring Services Corporation" (Case No. AC-
not compel the parties to reach an agreement, it does contemplate that both 220-RBXI-03-001-90 in the National Conciliation and Mediation Board,
parties will approach the negotiation with an open mind and make a Regional Branch XI. Davao City).
reasonable effort to reach a common ground of agreement
The controversy centers on the interpretation of two provisions of the five-
As a last-ditch attempt to effect a reversal of the decision sought to be year Collective Bargaining Agreement (effective April 15, 1989 up to April 14,
reviewed, petitioner capitalizes on the issue of due process claiming, that it 1994) between the petitioner, Davao Integrated Port and Stevedoring
was denied the right to be heard and present its side when the Labor Arbiter Services Corporation (or "DIPSSC"), and the respondent, Association of Trade
denied the Company's motion for further postponement. Unions [ATU-TUCP] (the Union, for short). Those provisions are:

Petitioner's aforesaid submittal failed to impress Us. Considering the various 1. ARTICLE VIII — SICK, VACATION AND EMERGENCY LEAVES.
postponements granted in its behalf, the claimed denial of due process
appeared totally bereft of any legal and factual support. As herein earlier Sec. 4 — Emergency Leaves. The Company agrees to grant a maximum or six
stated, petitioner had not even honored respondent Union with any reply to (6) days Emergency Leave with pay per calendar year to all regular field
the latter's successive letters, all geared towards bringing the Company to the workers, covered by this agreement who have rendered at least six months of
bargaining table. It did not even bother to furnish or serve the Union with its service (including overtime) per calendar year, are members of the Regular
counter proposal despite persistent requests made therefor. Certainly, the Labor Pool, upon prior approval by the company. Said Emergency Leave is not
moves and overall behavior of petitioner-company were in total derogation of cumulative (sic) nor commutable." (pp. 46-47, Rollo; Emphasis supplied.)
the policy enshrined in the New Labor Code which is aimed towards
expediting settlement of economic disputes. Hence, this Court is not ARTICLE XVII — SPECIAL PROVISIONS.
prepared to affix its imprimatur to such an illegal scheme and dubious
maneuvers. Sec. 4 — Union Education and Training Fund. The Company agrees to
contribute twelve thousand (P12,000.00) pesos per year to the Union
Neither are WE persuaded by petitioner-company's stand that the Collective Education and Training Fund. (p. 48, Rollo.)
Bargaining Agreement which was approved and adopted by the NLRC is a
total nullity for it lacks the company's consent, much less its argument that The controversy arose when petitioner, through its new Assistant General
once the Collective Bargaining Agreement is implemented, the Company will Manager Benjamin Marzo, insisted that the above provisions are to be
face the prospect of closing down because it has to pay a staggering amount interpreted as:
of economic benefits to the Union that will equal if not exceed its capital.
Such a stand and the evidence in support thereof should have been 1. Under Article VIII, Section 4 (Emergency Leave) — that before the
presented before the Labor Arbiter which is the proper forum for the intermittent field workers who are members of the Regular Labor Pool can
purpose. avail of the six (6) days Emergency Leave provided in this provision, the
workers must have rendered at least six months of service per calendar year
We agree with the pronouncement that it is not obligatory upon either side regardless of their employment status (i.e., regular or probationary). Thus, all
of a labor controversy to precipitately accept or agree to the proposals of the regular (non-intermittent) field workers, who belong to the Regular Labor
other. But an erring party should not be tolerated and allowed with impunity Pool must have rendered at least six months of service per calendar year to
to resort to schemes feigning negotiations by going through empty be entitled to the six days Emergency Leave Pay. Petitioner pointed out that
gestures.13 More so, as in the instant case, where the intervention of the the phrase "per calendar year" is used twice in Section 4, the first of which
National Labor Relations Commission was properly sought for after modifies the word "pay" and the second modifies the phrase "who or
conciliation efforts undertaken by the BLR failed. The instant case being a rendered at least six months of service." (pp. 130-131.) The entitlement and
certified one, it must be resolved by the NLRC pursuant to the mandate of enjoyment of the emergency leave must be strictly availed in the calendar
P.D. 873, as amended, which authorizes the said body to determine the year on which the six months service was rendered.
reasonableness of the terms and conditions of employment embodied in any
Collective Bargaining Agreement. To that extent, utmost deference to its 2. Under Article XVII, Section 4 (Union Education and Training Fund) —
findings of reasonableness of any Collective Bargaining Agreement as the petitioner required that the Union should first prepare and submit a seminar
governing agreement by the employees and management must be accorded program before it can avail of the Education and Training Fund of P12,000.00
due respect by this Court. per annum.

WHEREFORE, the instant petition is DISMISSED. The temporary restraining After due hearing, respondent Arbitrator rendered a decision on May 19,
order issued on August 27, 1980, is LIFTED and SET ASIDE. 1990, upholding the union's interpretations of Article VIII, Section 4 and
Article XVII, Section 4, of the Collective Bargaining Agreement. The dispositive
No pronouncement as to costs. portion of the decision reads:

SO ORDERED. 1. The first sentence of Article VIII, Section 4 which read: "The Company
agrees to grant maximum or six (6) days Emergency Leave with pay per
calendar year to all regular field workers" — refers to all non-intermittent
G.R. No. 93983 June 29, 1992 regular field workers who reported for work everyday and therefore the
requirement of six (6) months or 1,248 hours does not apply; whereas, the
DAVAO INTEGRATED PORT AND STEVEDORING SERVICES CORPORATION, next sentences which stated the following: "covered by this agreement who
petitioner, have rendered at least six months (including overtime) per calendar year, are
members of the Regular Labor Pool, upon prior approval by the company." —
vs. refers to intermittent workers/members of the Regular Labor Pool, whose
work depends upon the arrival of vessels in the wharf and therefore must
ALFREDO C. OLVIDA IN HIS CAPACITY AS VOLUNTARY ARBITRATOR, AND THE comply [with] the requirement in the agreement, and so before it can avail of
ASSOCIATION OF TRADE UNIONS (ATU-TUCP)., respondents. the six (6) days Emergency Leave with pay must first rendered at least six
months (including overtime) per calendar year. Once the 1,248 hours (6
months) is complied subject workers can avail the benefit anytime an
Emergency occurred and the same condition of 1,248 hours shall no longer decision of the National Labor Relations Commission dated November 17,
apply in the succeeding calendar years. 1976 and holding that, under the law and facts of the case, there was no
necessity for private respondent to obtain a clearance for the termination of
2. With respect to the other provision of Article XVII, Section 4 of the new petitioner's employment under Article 257 [b] of the Labor Code, as
CBA — Union Education and Training Fund — since the language of the amended, and that a mere report of such termination was sufficient, under
agreement is clear and simple the respondent company shall comply [with] Section 11 [f]. Rule XIV of the Rules and Regulations implementing said Code.
its obligation by contributing to the Union Education and Training Fund the
amount of Twelve Thousand (P12,000.00) pesos per year at the beginning of Petitioner Saturno Victoria was employed on March 17, 1956 by private
each and every year and/or P1,000.00 at the end of each and every month respondent Far East Broadcasting Company, Incorporated as a radio
during the lifetime of the CBA at the option of the respondent company. Any transmitter operator. Sometime in July 1971, he and his co-workers organized
post signing condition impose by either or the parties that may affect the the Far East Broadcasting Company Employees Association. After registering
spontaneous implementation of Article XVII, Section 4 is foreign to the their association with the then Department of Labor, they demanded
language of the contract. (pp. 139-140. Rollo.) recognition of said association by the company but the latter refused on the
ground that being a non-profit, non-stock, non-commercial and religious
In this petition for certiorari, petitioner assails the respondent Arbitrator's corporation, it is not covered by Republic Act 875, otherwise known as the
construction of Section 4, Article VII (on emergency leave) and Section 4, Industrial Peace Act, the labor law enforced at that time.
Article XVII (on the Union Education and Training Fund) of the CBA.
Several conciliation meetings were held at the Department of Labor and in
After deliberating on the divergent views of the parties on the those meetings, the Director of Labor Relations Edmundo Cabal advised the
aforementioned controversial provisions of the CBA, the Court finds the union members that the company could not be forced to recognize them or
petitioner's interpretation of Section 4, Article VIII (emergency leave) more to bargain collectively with them because it is a non-profit, non-commercial
logical than the Arbitrator's and the Union's. The provision of the CBA is and religious organization. Notwithstanding such advice, the union members
clear: (1) the employee must be a member of the Regular Labor Pool; (2) he is led by Saturno Victoria as its president, declared a strike and picketed the
entitled to only six (6) days emergency leave with pay per calendar year; and company's premises on September 6, 1972 for the purpose of seeking
(3) he must have rendered service for at least six (6) months during the year recognition of the labor union.
when he took his emergency leave. The emergency leave may be staggered
or it may last for any number of days as emergencies arise but the employee As a countermeasure, the company filed a case for damages with preliminary
is entitled only to six (6) days of emergency leave "with pay" per year. Since injunction against the strikers before the then Court of First Instance of
the emergency leave is allowed to enable the employee to attend to an Bulacan docketed as Civil Case No. 750-V. Said court issued an injunction
emergency in his family or household, it may be taken at any time during the enjoining the three-day-old strike staged against the company. The complaint
calendar year but he must render at least six months service for that year to was later amended seeking to declare the strike illegal.
be entitled to collect his wages for the six (6) days of his emergency leave.
Since emergencies are unexpected and unscheduled happenings, it would be Upon the declaration of martial law on September 21, 1972 and the
absurd to require the employee to render six (6) months service before being promulgation of Presidential Decree No. 21 creating the National Labor
entitled to take a six-day emergency leave with pay for it would mean that no Relations Commission, the ad hoc National Labor Relations Commission took
emergency leave can be taken by an employee during the first six months of a cognizance of the strike through NLRC Case No. 0021 entitled "Far East
calendar year. Broadcasting Company Employees Association, complainant versus Far East
Broadcasting Company, respondent" and NLRC Case No. 0285 entitled
With regard to the provision on Union Education and Training Fund in Section "Generoso Serino, complainant, versus Far East Broadcasting Company,
4, Article XVII of the CBA, the petitioner's requirement that the Union submit respondent", both cases for reinstatement due to the company's return to
a seminar program for each calendar year before it may claim the company's accept the union's offer to return to work during the pendency of the case in
P12,000 yearly donation to the fund, is not warranted by the terms of the the Court of First Instance.
CBA. The Arbitrator did not abuse his discretion in ruling that the respondent
company should comply with its obligation to contribute to the Union On December 28, 1972, Arbitrator Flavio Aguas rendered a joint decision in
Education and Training Fund the amount of Twelve Thousand (P12,000.00) the two cases mentioned above recognizing the jurisdiction of the Court of
pesos per year by paying said amount to the Union at the beginning of each First Instance of Bulacan, the dispositive portion reading as follows:
and every year, or contributing P1,000.00 at the end of each and every month
during the lifetime or the CBA, at the option of the company. As correctly IN VIEW WHEREOF, and in the interest of justice and equity, it is hereby
observed by the Arbitrator, the employer's demand for the submission of a directed that:
seminar program "is foreign to the language of the contract" with the union.
1. That striking members of the Far East Broadcasting Company Employees
WHEREFORE, the petition for certiorari is GRANTED. Section 4, Article VIII of Association return to their respective positions in the corporation;
the CBA is interpreted to mean that any employee who is a member of the
Regular Labor Pool is entitled to six (6) days emergency leave with pay per 2. The respondent Far East Broadcasting Company Incorporated to accept
calendar year provided he has rendered at least six (6) months service during back the returning strikers without loss in rank seniority or status;
the year when he took his emergency leave. The decision of the respondent
Voluntary Arbitrator is AFFIRMED in other respects. No costs. 3. The workers shall return to work within [10] days from receipt of this
resolution otherwise they shall be deemed to have forfeited such right;
SO ORDERED.
4. The respondent shall report compliance with this decision within fifteen
[15] days from receipt hereof.
G.R. No. L-49046 January 26, 1988
This Order shall, however, be without prejudice to whatever decision the
SATURNO A. VICTORIA, petitioner, Court of First Instance of Bulacan may promulgate in Civil Case No. 750-V and
vs. to the requirements the existing order may need of people working with the
HON. AMADO G. INCIONG, DEPUTY MINISTER, and FAR EAST BROADCASTING mass media of communications.
COMPANY, INC., respondents.
IT IS SO ORDERED. 1

FERNAN, J.: The decision of the arbitrator was successively appealed to the ad hoc
National Labor Relations Commission, the Secretary of Labor and the Office
Petition for review of the Order of the then Acting Secretary of Labor Amado of the President of the Philippines, and was affirmed in all instances.
G. Inciong dated June 6, 1978, in NLRC Case No. RB-1764-75, reversing the
On April 23, 1975, the Court of First Instance of Bulacan rendered judgment, Since said decision was affirmed by the NLRC, the Secretary of Labor, and the
to wit: Office of the President of the Philippines, complainants were reinstated
pursuant thereto.
WHEREFORE, judgment is hereby rendered:
In a Decision dated April 23, 1975, in Civil Case No. 750-V, promulgated by
1. Making injunction against defendants permanent; the Court of First Instance of Bulacan, the strike staged by herein complainant
and the other strikers was declared illegal. Based on said Decision,
2. Declaring that this Court has jurisdiction to try and hear the instant case respondent dismissed complainant from his employment. Hence,
despite Section 2 of Presidential Decree No. 2; complainant filed the instant complaint for illegal dismissal.

3. Declaring that plaintiff Far East Broadcasting Company is a non-profit Under the aforecited facts, we do not agree with the ruling of the
organization since it does not declare dividends; Commission now subject of this appeal that an application for clearance to
terminate herein complainant is mandatory on the part of respondent before
4. Declaring that the strike admitted by the defendants to have been terminating complainant's services. We believe that what would have been
declared by them is illegal inasmuch as it was for the purpose of compelling necessary was a report as provided for under Section 11 [f] Rule XIV, Book V
the plaintiff-company to recognize their labor union which could not be of the Rules and Regulations Implementing the Labor Code. Moreover, even if
legally done because the plaintiffs were not covered by Republic Act 875; an application for clearance was flied, this Office would have treated the
same as a report. Otherwise, it would render nugatory the Decision of the
5. Declaring that the evidence presented is insufficient to show that Arbitrator dated December 28, 1972 in Case Nos. 0021 and 0285 which was
defendants caused the damage to the plaintiff consequent on the destruction affirmed by the Commission, the Secretary of Labor and the Office of the
of its relays and its antennas as well as its transmission lines. President of the Philippines, ordering his temporary reinstatement, subject to
whatever Decision the CFI of Bulacan may promulgate in Civil Case No. 750-V.
SO ORDERED. 2 It could be clearly inferred from said CFI Decision that if the strike is declared
illegal, the strikers will be considered to have lost their employment status
On April 24, 1975, by virtue of the above decision, the company notified under the then existing laws and jurisprudence, otherwise strikers could
Saturno Victoria that he is dismissed effective April 26, 1975. Thereupon, he stage illegal strike with impunity. Since the strike was declared illegal,
filed Case No. RB-IV-1764 before the National Labor Relations Commission, respondent acted in good faith when it dispensed with the services of herein
Regional Branch IV against the company alleging violation of article 267 of complainant.
the Labor Code which requires clearance from the Secretary of Labor for
every shutdown of business establishments or dismissal of employees. On For failure of respondent to file the necessary report and based on equitable
February 27, 1976, Labor Arbiter Manuel B. Lorenzo rendered a decision in considerations, complainant should be granted separation pay equivalent to
petitioner's favor declaring the dismissal to be illegal, thereby ordering one-half month salary for every year of service.
reinstatement with fun backwages. On appeal, the arbiter's decision was
aimed by the National Labor Relations Commission. But when the WHEREFORE, let the decision of the National Labor Relations Commission
commission's decision was in turn appealed to the Secretary of Labor, it was dated November 17, 1976 be, as it is hereby, set aside and a new judgment is
set aside and in lieu thereof the questioned Order dated June 6, 1978 was entered, ordering respondent to give complainant separation pay equivalent
issued. to one-half month salary for every year of service.

In view of its brevity and for a better understanding of the reasons behind it, SO ORDERED. 3
We quote the disputed Order in full:
Petitioner elevates to Us for review on certiorari the aforequoted Order
ORDER seeking to persuade this Court that then Acting Secretary of Labor Amado G.
Inciong committed reversible error in holding that, under the law and facts of
This is an appeal by respondent from the Decision of the National Labor this case, a mere report of the termination of the services of said petitioner
Relations Commission, dated November 17, 1976. was sufficient. Petitioner assigns the following errors:

The Commission upheld the Decision of the labor arbiter dated February 27, I
1976 ordering respondent to reinstate with full backwages herein
complainant Saturno A. Victoria based on the finding that respondent did not WHETHER OR NOT A CLEARANCE FROM THE SECRETARY OF LABOR IS STILL
file any application for clearance to terminate the services of complainant NECESSARY BEFORE THE PETITIONER HEREIN COULD BE DISMISSED
before dismissing him from his employment. CONSIDERING THE RESTRICTIVE CONDITION IN THE DECISION OF THE
COMPULSORY ARBITRATOR IN NLRC CASE NOS. 0021 AND 0285.
Briefly the facts of this case are as follows:
II
Complainant Saturno Victoria is the president of the Far East Broadcasting
Company Employees Union. On September 8, 1972, the said union declared a WHETHER OR NOT THE DECISION OF THE COURT OF FIRST INSTANCE OF
strike against respondent company. On September 11, 1972, respondent filed BULACAN IN CIVIL CASE NO. 750-V IPSO FACTO GAVE THE RESPONDENT
with the Court of First Instance of Bulacan, Civil Case No. 750-V, for the COMPANY AUTHORITY TO DISMISS HEREIN PETITIONER WITHOUT ANY
issuance of an injunction and a prayer that the strike be declared illegal. CLEARANCE FROM THE SECRETARY OF LABOR. 4

On October 24, 1972, complainant together with the other strikers filed with The substantive law on the matter enforced during the time of petitioner's
the ad hoc National Labor Relations Commission Case Nos. 0021 and 0285 for dismissal was Article 267 [b] of the Labor Code [in conjunction with the rules
reinstatement. The Arbitrator rendered a decision in said case on December and regulations implementing said substantive law.] Article 267 reads:
28, 1972, wherein he ordered respondent to reinstate complainants subject
to the following condition: No employer that has no collective bargaining agreement may shut down his
establishment or dismiss or terminate the service of regular employees with
"This Order shall, however, be without prejudice to whatever decision the at least one [1] year of service except managerial employees as defined in
Court of First Instance may promulgate on Civil Case No. 750-V and to the this book without previous written clearance from the Secretary of Labor.
requirements the existing order may need of people working with the mass
media of communications." Petitioner maintains that the abovecited provision is very clear. It does not
make any distinction as to the ground for dismissal. Whether or not the
dismissal sought by the employer company is for cause, it is imperative that
the company must apply for a clearance from the Secretary of Labor.
organizations of said non-profit organizations for certification as the exclusive
In a recent case 5 penned by Justice Abraham F. Sarmiento promulgated on bargaining representatives of said employees and laborers. 7
June 30, 1987, we had occasion to rule in agreement with the findings of
then Presidential Assistant for Legal Affairs Ronaldo Zamora that the purpose As a strike is an economic weapon at war with the policy of the Constitution
in requiring a prior clearance from the Secretary of Labor in cases of and the law at that time, a resort thereto by laborers shall be deemed to be a
shutdown or dismissal of employees, is to afford the Secretary ample choice of remedy peculiarly their own and outside of the statute, and as
opportunity to examine and determine the reasonableness of the request. such, the strikers must accept all the risks attendant upon their choice. If they
succeed and the employer succumbs, the law will not stand in their way in
The Solicitor General, in relation to said pronouncement and in justification of the enjoyment of the lawful fruits of their victory. But if they fail, they cannot
the Acting Labor Secretary's decision makes the following observations: thereafter invoke the protection of the law for the consequences of their
conduct unless the right they wished vindicated is one which the law will, by
It is true that article 267 [b] of the Labor Code requires that before any all means, protect and enforce. 8
business establishment is shut down or any employee is dismissed, written
clearance from the Secretary of Labor must first be obtained. It is likewise We further agree with the Acting Secretary of Labor that what was required
true that in the case of petitioner, there was no written clearance in the usual in the case of petitioner's dismissal was only a report as provided under
form. But while there may not have been strict compliance with Article 267 Section 11 [f] of Rule XIV of the Rules and Regulations implementing the
there was substantial compliance. The Secretary of Labor twice manifested Labor Code which provides:
his conformity to petitioner's dismissal.
Every employer shall submit a report to the Regional Office in accordance
The first manifestation of acquiescence by the Secretary of Labor to the with the form presented by the Department on the following instances of
dismissal of petitioner was his affirmance of the decision of the arbitrator in termination of employment, suspension, lay-off or shutdown which may be
NLRC Case Nos. 0021 and 0285. The arbitrator ordered the reinstatement of effected by the employer without prior clearance within five [5] days
the strikers but subject to the decision of the CFI of Bulacan in Civil Case No. thereafter:
750-V. The Secretary of Labor affirmed the decision of the arbitrator. In effect,
therefore, the Secretary of Labor issued a carte blanche to the CFI of Bulacan xxx xxx xxx
to either dismiss or retain petitioner.
[f] All other terminations of employment, suspension, lay-offs or
The second manifestation was his decision in NLRC Case No. RB-IV-1764-65 shutdowns, not otherwise specified in this and in the immediately preceding
wherein he said that clearance for the dismissal of petitioner was not sections.
required, but only a report; that even if an application for clearance was filed,
he would have treated it as a mere report. While this is not prior clearance in To hold otherwise would render nugatory the conditions set forth in the
the contemplation of Article 267, it is at least a ratification of the dismissal of decision of Labor Arbiter Aguas on the basis of which petitioner was
petitioner. 6 temporarily reinstated.

We agree with the Solicitor General. Technically speaking, no clearance was Inasmuch as there was a valid and reasonable ground to dismiss petitioner
obtained by private respondent from the then Secretary of Labor, the last but no report as required by the implementing rules and regulations of the
step towards full compliance with the requirements of law on the matter of Labor Code was filed by respondent Company with the then Department of
dismissal of employees. However, the rationale behind the clearance Labor, petitioner as held by the Acting Secretary of Labor, is entitled to
requirement was fully met. The Secretary of Labor was apprised of private separation pay equivalent to one-half month salary for every year of service.
respondent's intention to terminate the services of petitioner. This in effect is
an application for clearance to dismiss petitioner from employment. The WHEREFORE, the petition is dismissed. The decision of the acting Secretary of
affirmance of the restrictive condition in the dispositive portion of the labor Labor is AFFIRMED in toto.
arbiter's decision in NLRC Case Nos. 0021 and 0285 by the Secretary of Labor
and the Office of the President of the Philippines, signifies a grant of SO ORDERED.
authority to dismiss petitioner in case the strike is declared illegal by the
Court of First Instance of Bulacan. Consequently and as correctly stated by G.R. No. 85985 August 13, 1993
the Solicitor General, private respondent acted in good faith when it PHILIPPINE AIRLINES, INC. (PAL), petitioner, vs. NATIONAL LABOR
terminated the employment of petitioner upon a declaration of illegality of RELATIONS COMMISSION, LABOR ARBITER ISABEL P. ORTIGUERRA and
the strike by the Court of First Instance of Bulacan. Moreover, the then PHILIPPINE AIRLINES EMPLOYEES ASSOCIATION (PALEA), respondents.
Secretary of Labor manifested his conformity to the dismissal, not once, but
twice. In this regard, the mandatory rule on clearance need not be applied. MELO, J.:
In the instant petition for certiorari, the Court is presented the issue of
The strike staged by the union in 1972 was a futile move. The law then whether or not the formulation of a Code of Discipline among employees is a
enforced, Republic Act 875 specifically excluded respondent company from shared responsibility of the employer and the employees.
its coverage. Even if the parties had gone to court to compel recognition, no
positive relief could have been obtained since the same was not sanctioned On March 15, 1985, the Philippine Airlines, Inc. (PAL) completely revised its
by law. Because of this, there was no necessity on the part of private 1966 Code of Discipline. The Code was circulated among the employees and
respondent to show specific acts of petitioner during the strike to justify his was immediately implemented, and some employees were forthwith
dismissal. subjected to the disciplinary measures embodied therein.

This is a matter of responsibility and of answerability. Petitioner as a union Thus, on August 20, 1985, the Philippine Airlines Employees Association
leader, must see to it that the policies and activities of the union in the (PALEA) filed a complaint before the National Labor Relations Commission
conduct of labor relations are within the precepts of law and any deviation (NLRC) for unfair labor practice (Case No. NCR-7-2051-85) with the following
from the legal boundaries shall be imputable to the leader. He bears the remarks: "ULP with arbitrary implementation of PAL's Code of Discipline
responsibility of guiding the union along the path of law and to cause the without notice and prior discussion with Union by Management" (Rollo, p.
union to demand what is not legally demandable, would foment anarchy 41). In its position paper, PALEA contended that PAL, by its unilateral
which is a prelude to chaos. implementation of the Code, was guilty of unfair labor practice, specifically
Paragraphs E and G of Article 249 and Article 253 of the Labor Code. PALEA
Petitioner should have known and it was his duty to impart this imputed alleged that copies of the Code had been circulated in limited numbers; that
knowledge to the members of the union that employees and laborers in non- being penal in nature the Code must conform with the requirements of
profit organizations are not covered by the provisions of the Industrial Peace sufficient publication, and that the Code was arbitrary, oppressive, and
Act and the Court of Industrial Relations [in the case at bar, the Court of First prejudicial to the rights of the employees. It prayed that implementation of
Instance] has no jurisdiction to entertain petitions of labor unions or the Code be held in abeyance; that PAL should discuss the substance of the
Code with PALEA; that employees dismissed under the Code be reinstated 2. Reconsider the cases of employees meted with penalties under the
and their cases subjected to further hearing; and that PAL be declared guilty New Code of Discipline and remand the same for further hearing; and
of unfair labor practice and be ordered to pay damages (pp. 7-14, Record.)
3. Discuss with PALEA the objectionable provisions specifically tackled in
PAL filed a motion to dismiss the complaint, asserting its prerogative as an the body of the decision.
employer to prescibe rules and regulations regarding employess' conduct in
carrying out their duties and functions, and alleging that by implementing the All other claims of the complainant union (is) [are] hereby, dismissed for lack
Code, it had not violated the collective bargaining agreement (CBA) or any of merit.
provision of the Labor Code. Assailing the complaint as unsupported by
evidence, PAL maintained that Article 253 of the Labor Code cited by PALEA SO ORDERED. (p. 40, Rollo.)
reffered to the requirements for negotiating a CBA which was inapplicable as
indeed the current CBA had been negotiated. PAL appealed to the NLRC. On August 19, 1988, the NLRC through
Commissioner Encarnacion, with Presiding Commissioner Bonto-Perez and
In its reply to PAL's position paper, PALEA maintained that Article 249 (E) of Commissioner Maglaya concurring, found no evidence of unfair labor practice
the Labor Code was violated when PAL unilaterally implemented the Code, committed by PAL and affirmed the dismissal of PALEA's charge. Nonetheless,
and cited provisions of Articles IV and I of Chapter II of the Code as defective the NLRC made the following observations:
for, respectively, running counter to the construction of penal laws and
making punishable any offense within PAL's contemplation. These provisions Indeed, failure of management to discuss the provisions of a contemplated
are the following: code of discipline which shall govern the conduct of its employees would
result in the erosion and deterioration of an otherwise harmonious and
Sec. 2. Non-exclusivity. — This Code does not contain the entirety of the smooth relationship between them as did happen in the instant case. There is
rules and regulations of the company. Every employee is bound to comply no dispute that adoption of rules of conduct or discipline is a prerogative of
with all applicable rules, regulations, policies, procedures and standards, management and is imperative and essential if an industry, has to survive in a
including standards of quality, productivity and behaviour, as issued and competitive world. But labor climate has progressed, too. In the Philippine
promulgated by the company through its duly authorized officials. Any scene, at no time in our contemporary history is the need for a cooperative,
violations thereof shall be punishable with a penalty to be determined by the supportive and smooth relationship between labor and management more
gravity and/or frequency of the offense. keenly felt if we are to survive economically. Management can no longer
exclude labor in the deliberation and adoption of rules and regulations that
Sec. 7. Cumulative Record. — An employee's record of offenses shall be will affect them.
cumulative. The penalty for an offense shall be determined on the basis of his
past record of offenses of any nature or the absence thereof. The more The complainant union in this case has the right to feel isolated in the
habitual an offender has been, the greater shall be the penalty for the latest adoption of the New Code of Discipline. The Code of Discipline involves
offense. Thus, an employee may be dismissed if the number of his past security of tenure and loss of employment — a property right! It is time that
offenses warrants such penalty in the judgment of management even if each management realizes that to attain effectiveness in its conduct rules, there
offense considered separately may not warrant dismissal. Habitual offenders should be candidness and openness by Management and participation by the
or recidivists have no place in PAL. On the other hand, due regard shall be union, representing its members. In fact, our Constitution has recognized the
given to the length of time between commission of individual offenses to principle of "shared responsibility" between employers and workers and has
determine whether the employee's conduct may indicate occasional lapses likewise recognized the right of workers to participate in "policy and decision-
(which may nevertheless require sterner disciplinary action) or a pattern of making process affecting their rights . . ." The latter provision was interpreted
incorrigibility. by the Constitutional Commissioners to mean participation in "management"'
(Record of the Constitutional Commission, Vol. II).
Labor Arbiter Isabel P. Ortiguerra handling the case called the parties to a
conference but they failed to appear at the scheduled date. Interpreting such In a sense, participation by the union in the adoption of the code if conduct
failure as a waiver of the parties' right to present evidence, the labor arbiter could have accelerated and enhanced their feelings of belonging and would
considered the case submitted for decision. On November 7, 1986, a decision have resulted in cooperation rather than resistance to the Code. In fact,
was rendered finding no bad faith on the part of PAL in adopting the Code labor-management cooperation is now "the thing." (pp. 3-4, NLRC Decision ff.
and ruling that no unfair labor practice had been committed. However, the p. 149, Original Record.)
arbiter held that PAL was "not totally fault free" considering that while the
issuance of rules and regulations governing the conduct of employees is a Respondent Commission thereupon disposed:
"legitimate management prerogative" such rules and regulations must meet
the test of "reasonableness, propriety and fairness." She found Section 1 of WHEREFORE, premises considered, we modify the appealed decision in the
the Code aforequoted as "an all embracing and all encompassing provision sense that the New Code of Discipline should be reviewed and discussed with
that makes punishable any offense one can think of in the company"; while complainant union, particularly the disputed provisions [.] (T)hereafter,
Section 7, likewise quoted above, is "objectionable for it violates the rule respondent is directed to furnish each employee with a copy of the appealed
against double jeopardy thereby ushering in two or more punishment for the Code of Discipline. The pending cases adverted to in the appealed decision if
same misdemeanor." (pp. 38-39, Rollo.) still in the arbitral level, should be reconsidered by the respondent Philippine
Air Lines. Other dispositions of the Labor Arbiter are sustained.
The labor arbiter also found that PAL "failed to prove that the new Code was
amply circulated." Noting that PAL's assertion that it had furnished all its SO ORDERED. (p. 5, NLRC Decision.)
employees copies of the Code is unsupported by documentary evidence, she
stated that such "failure" on the part of PAL resulted in the imposition of PAL then filed the instant petition for certiorari charging public respondents
penalties on employees who thought all the while that the 1966 Code was with grave abuse of discretion in: (a) directing PAL "to share its management
still being followed. Thus, the arbiter concluded that "(t)he phrase ignorance prerogative of formulating a Code of Discipline"; (b) engaging in quasi-judicial
of the law excuses no one from compliance . . . finds application only after it legislation in ordering PAL to share said prerogative with the union; (c)
has been conclusively shown that the law was circulated to all the parties deciding beyond the issue of unfair labor practice, and (d) requiring PAL to
concerned and efforts to disseminate information regarding the new law reconsider pending cases still in the arbitral level (p. 7, Petition; p. 8, Rollo.)
have been exerted. (p. 39, Rollo.) She thereupon disposed:
As stated above, the Principal issue submitted for resolution in the instant
WHEREFORE, premises considered, respondent PAL is hereby ordered as petition is whether management may be compelled to share with the union
follows: or its employees its prerogative of formulating a code of discipline.

1. Furnish all employees with the new Code of Discipline;


PAL asserts that when it revised its Code on March 15, 1985, there was no The exercise by management of its prerogative shall be done in a just
law which mandated the sharing of responsibility therefor between employer reasonable, humane and/or lawful manner.
and employee.
Such provision in the collective bargaining agreement may not be interpreted
Indeed, it was only on March 2, 1989, with the approval of Republic Act No. as cession of employees' rights to participate in the deliberation of matters
6715, amending Article 211 of the Labor Code, that the law explicitly which may affect their rights and the formulation of policies relative thereto.
considered it a State policy "(t)o ensure the participation of workers in And one such mater is the formulation of a code of discipline.
decision and policy-making processes affecting the rights, duties and
welfare." However, even in the absence of said clear provision of law, the Indeed, industrial peace cannot be achieved if the employees are denied
exercise of management prerogatives was never considered boundless. Thus, their just participation in the discussion of matters affecting their rights. Thus,
in Cruz vs. Medina (177 SCRA 565 [1989]) it was held that management's even before Article 211 of the labor Code (P.D. 442) was amended by
prerogatives must be without abuse of discretion. Republic Act No. 6715, it was already declared a policy of the State, "(d) To
promote the enlightenment of workers concerning their rights and
In San Miguel Brewery Sales Force Union (PTGWO) vs. Ople (170 SCRA 25 obligations . . . as employees." This was, of course, amplified by Republic Act
[1989]), we upheld the company's right to implement a new system of No 6715 when it decreed the "participation of workers in decision and policy
distributing its products, but gave the following caveat: making processes affecting their rights, duties and welfare." PAL's position
that it cannot be saddled with the "obligation" of sharing management
So long as a company's management prerogatives are exercised in good faith prerogatives as during the formulation of the Code, Republic Act No. 6715
for the advancement of the employer's interest and not for the purpose of had not yet been enacted (Petitioner's Memorandum, p. 44; Rollo, p. 212),
defeating or circumventing the rights of the employees under special laws or cannot thus be sustained. While such "obligation" was not yet founded in law
under valid agreements, this Court will uphold them. when the Code was formulated, the attainment of a harmonious labor-
(at p. 28.) management relationship and the then already existing state policy of
enlightening workers concerning their rights as employees demand no less
All this points to the conclusion that the exercise of managerial prerogatives than the observance of transparency in managerial moves affecting
is not unlimited. It is circumscribed by limitations found in law, a collective employees' rights.
bargaining agreement, or the general principles of fair play and justice
(University of Sto. Tomas vs. NLRC, 190 SCRA 758 [1990]). Moreover, as Petitioner's assertion that it needed the implementation of a new Code of
enunciated in Abbott Laboratories (Phil.), vs. NLRC (154 713 [1987]), it must Discipline considering the nature of its business cannot be overemphasized.
be duly established that the prerogative being invoked is clearly a managerial In fact, its being a local monopoly in the business demands the most
one. stringent of measures to attain safe travel for its patrons. Nonetheless,
whatever disciplinary measures are adopted cannot be properly
A close scrutiny of the objectionable provisions of the Code reveals that they implemented in the absence of full cooperation of the employees. Such
are not purely business-oriented nor do they concern the management cooperation cannot be attained if the employees are restive on account, of
aspect of the business of the company as in the San Miguel case. The their being left out in the determination of cardinal and fundamental matters
provisions of the Code clearly have repercusions on the employee's right to affecting their employment.
security of tenure. The implementation of the provisions may result in the
deprivation of an employee's means of livelihood which, as correctly pointed WHEREFORE, the petition is DISMISSED and the questioned decision
out by the NLRC, is a property right (Callanta, vs Carnation Philippines, Inc., AFFIRMED. No special pronouncement is made as to costs.
145 SCRA 268 [1986]). In view of these aspects of the case which border on SO ORDERED.
infringement of constitutional rights, we must uphold the constitutional
requirements for the protection of labor and the promotion of social justice,
for these factors, according to Justice Isagani Cruz, tilt "the scales of justice G.R. Nos. L-30632-33 April 11, 1972
when there is doubt, in favor of the worker" (Employees Association of the
Philippine American Life Insurance Company vs. NLRC, 199 SCRA 628 [1991] CALTEX FILIPINO MANAGERS AND SUPERVISORS ASSOCIATION petitioner,
635). vs.
COURT OF INDUSTRIAL RELATIONS, CALTEX (PHILIPPINES), INC., W.E.
Verily, a line must be drawn between management prerogatives regarding MENEFEE and B.F. EDWARDS, respondents.
business operations per se and those which affect the rights of the
employees. In treating the latter, management should see to it that its Domingo E. de Lara and Associates for petitioner.
employees are at least properly informed of its decisions or modes action.
PAL asserts that all its employees have been furnished copies of the Code. Siguion Reyna, Montecillo, Belo and Ongsiako for private respondent.
Public respondents found to the contrary, which finding, to say the least is
entitled to great respect.
VILLAMOR, J.:p
PAL posits the view that by signing the 1989-1991 collective bargaining
agreement, on June 27, 1990, PALEA in effect, recognized PAL's "exclusive This is an appeal by the Caltex Filipino Managers and Supervisors' Association
right to make and enforce company rules and regulations to carry out the from the resolution en banc dated May 16, 1969 of the Court of Industrial
functions of management without having to discuss the same with PALEA and Relations affirming the decision dated February 26, 1969 of Associate Judge
much less, obtain the latter's conformity thereto" (pp. 11-12, Petitioner's Emiliano C. Tabigne, Associate Judge Ansberto P. Paredes dissented from the
Memorandum; pp 180-181, Rollo.) Petitioner's view is based on the following resolution of the majority on the ground that the Industrial Court in a
provision of the agreement: representation case cannot take cognizance of the issue of illegality of a strike
and proceed to declare the loss of the employee status of employees
The Association recognizes the right of the Company to determine matters of inasmuch as that matter ought to be processed as an unfair labor practice
management it policy and Company operations and to direct its manpower. case. Judge Tabigne's decision covers two cases, namely, Case No. 1484-MC
Management of the Company includes the right to organize, plan, direct and (1) in which he declared the strike staged on April 22, 1965 by the Association
control operations, to hire, assign employees to work, transfer employees as illegal with the consequent forfeiture of the employee status of three
from one department, to another, to promote, demote, discipline, suspend employees (Jose J. Mapa, President of the Association; Dominador
or discharge employees for just cause; to lay-off employees for valid and legal Mangalino, Vice-President and Herminigildo Mandanas) and Case No. 4344-
causes, to introduce new or improved methods or facilities or to change ULP against Caltex (Philippines), Inc., Ben F. Edwards W.E. Menefee which
existing methods or facilities and the right to make and enforce Company Judge Tabigne dismissed for lack of merit and substantial evidence.
rules and regulations to carry out the functions of management.
The following proceedings gave rise to the present appeal:
The Caltex Filipino Managers and Supervisors' Association is a labor Petitioner prays for such other and further relief as this Honorable Court may
organization of Filipino managers supervisors in Caltex (Philippines), Inc., deem just and equitable in the premises. (Annex "D", Petition)
respondent Company in this proceeding. After the Association was registered
as a labor organization it sent a letter to the Company on January 21, 1965 Such urgent petition was frontally met by the Association with a motion to
informing the latter of the former's registration; the Company replied dismiss questioning the jurisdiction of the industrial court. The motion to
inquiring on the position titles of the employees which the Association dismiss was opposed by the Company and on May 17, 1965 the trial court
sought to represent. On February 8, 1965 the Association sent a set of denied the same. Not satisfied with the order of May 17, 1965, the
proposals to the Company wherein one of the demands was the recognition Association moved for its reconsideration before respondent court en banc.
of the Association as the duly authorized bargaining agency for managers and
supervisors in the Company. To this the Company countered stating that a Because of the settlement between the parties on May 30, 1965 of some of
distinction exists between representatives of management and individuals their disputes, the Association filed with respondent court under date of June
employed as supervisors and that it is Company's belief that managerial 3, 1965 a manifestation (to which was attached a copy of the return-to-work
employees are not qualified for membership in a labor organization; hence, it agreement signed by the parties on May 30, 1965), to the effect that the
is digested that the Association institute a certification proceeding so as to issues in Case No. 1484-MC (1) had become moot and academic. Under date
remove any question with regard to position titles that should be included in of June 15, 1965 the Company filed a counter-manifestation disputing the
the bargaining unit. The Association felt disinclined to follow the suggestion representations of the Association on the effect of the return-to-work
of the Company1 and so on February 22, 1965 the Company initiated a agreement. On the basis of the manifestation and counter-manifestation,
certification proceeding docketed as Case 1484-MC. respondent court en banc issued a resolution on August 24, 1965 allowing
the withdrawal of the Association's motion for reconsideration against the
On March 8, 1965 the Association filed notice to strike giving the following order of May 17, 1965, on the theory that there was justification for such
reasons: withdrawal.

Refusal to bargain in good faith and to act on demands, a copy of which is Relative to the resolution of August 24, 1965 the Company filed a motion for
enclosed; resort to union-busting tactics in order to discourage the activities clarification which the Association opposed on September 22, 1965, for it
of the undersigned association and its members, including discrimination and contended that such motion was in reality a motion for reconsideration and
intimidation of officers and members of the association and circulation of as such filed out of time. But respondent court brushed aside the
promises of immediate benefits to be given by the company to its employees, Association's opposition and proceeded to clarify the resolution of August 24,
officers and members of this association or those intending to join the same, 1965 to mean that the Company was not barred from continuing with Case
if the employees concerned in due course will vote against the selection of No. 1484-MC(1).
this association as the exclusive collective bargaining unit for managers and
supervisors of the Company in the petition for certification the latter filed. At the hearing on September 1, 1965 of Case No. 1484-MC(1) the Association
(Annex "A" of Annex "A", Petition). insisted that the incident had become moot and academic and must be
considered dismissed and, at the same time, it offered to present evidence, if
On March 29, 1965, during the hearing of the certification proceedings, Judge still necessary, in order to support its contention. Respondent court
Tabigne cautioned the parties to maintain the status quo; he specifically thereupon decided to secure evidence from the parties to enlighten it on the
advised the employees not to go on strike, making it clear, however, that in interpretation of the provisions of the return-to-work agreement relied upon
the presence of unfair labor practices they could go on strike even without by the Association as rendering the issues raised in Case No. 1484-MC(1)
any notice.2 already moot and academic. Evidence having been received, the trial court
ruled in its order of February 15, 1966 that under the return-to-work
On the basis of the strike notice filed on March 8, 1965 and in view of acts agreement the Company had reserved its rights to prosecute Case No. 1484-
committed by the Company which the Association considered as constituting MC(1) and, accordingly, directed that the case be set for hearing covering the
unfair labor practice, the Association struck on April 22, 1965, after the alleged illegality of the strike. Within the prescribed period the Association
efforts exerted by the Bureau of Labor Relations to settle the differences filed a motion for reconsideration of the February 15, 1966 order to which
between the parties failed. Then, through an "Urgent Petition" dated April motion the Company filed its opposition and, in due course, respondent
26, 1965 filed as Case No. 1484-MC(1), or as an incident of the certification court en banc issued its resolution dated March 28, 1966 affirming the order.
election proceedings (Case No. 1484-MC), the Company prayed as follows: Appeal from the interlocutory order was elevated by the Association to this
Court in G.R. No. L-25955, but the corresponding petition for review was
WHEREFORE, petitioner respectfully prays this Honorable Court that: summarily "DISMISSED for being premature" under this court's resolution of
May 13, 1966.
1. The strike of respondent Caltex Filipino Managers and Supervisors
Association be declared illegal; After a protracted preliminary investigation, the Association's charge for
unfair labor practices against the Company and its officials docketed in a
2. The officers and members of respondent association who have separate proceeding was given due course through the filing by the
instigated, declared, encouraged and/or participated in the illegal strike be prosecution division of respondent court of the corresponding complaint
held and punished for contempt of this Honorable Court and be declared to dated September 10, 1965, in Case No. 4344-ULP against Caltex (Philippines),
have lost their employee status; Inc., W. E. Menefee and B.F. Edwards. As noted by respondent court in its
decision under review, Case No. 4344-ULP was filed by the Association
3. Pending hearing on the merits and upon the filing of a bond in an because, according to the latter, the Company and some of its officials,
amount to be fixed by this Honorable Court, a temporary injunction be issued including B.F. Edwards, inquired into the organization of the Association and
restraining respondent association, its officers, members and representatives he manifested his antagonism to it and its President; that another Company
acting for and on their behalf from committing, causing or directing the official, W.E. Menefee issued a statement of policy designed to discourage
commission of the unlawful acts complained of, particularly obstructing and employees and supervisors from joining labor organizations; that the
preventing petitioner, its customers, officers and non-striking employees from Company refused to bargain although the Association commands majority
entering and going out of its various offices, in its refinery, installations, representation; that due to the steps taken by the Company to destroy the
depots and terminals and the use or threat of violence and intimidation; Association or discourage its members from continuing their union
membership, the Association was forced to file a strike notice; that on April
4. After trial, said injunction be made permanent; 22, 1965 it declared a strike; and that during the strike the Company and its
officers continued their efforts to weaken the Association as well as its picket
5. The damages that petitioner has suffered and will suffer up to the trial lines. The Company in its answer filed with respondent court denied the
of this action be ascertained and judgment be rendered against respondent charges of unfair labor practice.
association, its officers, members and representatives jointly and severally for
the amount thereof. Considering the interrelation of the issues involved in the two cases and by
agreement of the parties, the two cases were heard jointly. This explains why
only one decision was rendered by respondent court covering both Case No.
1484-MC(1), relating to the illegality of the strike as contended by the RESPONDENT COURT ERRED IN RENDERING JUDGEMENT FOR THE CAFIMSA
Company, and Case No. 4344-ULP, referring to the unfair labor practice case IN CASE NO. 4344-ULP AND IN NOT ORDERING THE COMPANY TO PAY BACK
filed by the Association against the Company, W.E. Menefee and B.F. WAGE AND ATTORNEY'S FEES.
Edwards.
XI
The Association assigned the following errors allegedly committed by
respondent court: RESPONDENT COURT ERRED IN PREMATURELY IMPLEMENTING THE TRIAL
COURT'S DISMISSAL OF J.J. MAPA AND DOMINADOR MANGALINO (Brief for
I the Petitioner, pp. 1-4).

RESPONDENT COURT ERRED IN ASSUMING JURISDICTION OVER CASE NO. To our mind the issues raised in this appeal may be narrowed down to the
1484-MC(1). following:

II 1. whether or not the Court of Industrial Relations has jurisdiction over


Case No. 1484-MC(1);
ASSUMING THAT RESPONDENT COURT HAS JURISDICTION OVER CASE NO.
1484-MC(1), IT ERRED IN NOT HOLDING THAT THE SAME ALREADY BECAME 2. Whether or not the strike staged by the Association on April 22, 1965 is
MOOT WITH THE SIGNING OF THE RETURN TO WORK AGREEMENT ON MAY illegal and, incident thereto, whether respondent court correctly terminated
30, 1965. the employee status of Jose Mapa, Dominador Mangalino and Herminigildo
Mandanas and reprimanded and admonished the other officers of the
III Association; and

ASSUMING LIKEWISE THAT RESPONDENT COURT HAS JURISDICTION OVER 3. Whether or not respondent court correctly absolved the respondents in
CASE NO. 1484-MC(1), IT ERRED IN HOLDING THAT CAFIMSA'S STRIKE WAS Case No. 4344-ULP from the unfair labor practice charge.
STAGED FOR NO OTHER REASON THAN TO COERCE THE COMPANY INTO
RECOGNIZING THE CAFIMSA AND THAT SUCH STRIKE WAS UNJUSTIFIED, Respondent's court's jurisdiction over Case No. 1484-MC(1) has to be tested
UNLAWFUL AND UNWARRANTED. by the allegations of the "Urgent Petition" dated April 26, 1965 filed by the
Company in relation to the applicable provisions of law. A reading of said
IV pleading shows that the same is for injunctive relief under Section 9(d) of
Republic Act No. 875 (Magna Carta of Labor); for contempt, obviously
RESPONDENT COURT ERRED IN AFFIRMING THE TRIAL COURT'S CONCLUSION pursuant to See, 6 of Commonwealth Act No. 103 in conjunction with Sec. 3
THAT CAFIMSA'S STRIKE WAS DECLARED IN OPEN DEFIANCE OF THE MARCH (b) of Rule 71 of the Rules of Court; and for forfeiture of the employee status
29, 1965 ORDER IN CERTIFICATION CASE NO. 1484-MC. of the strikers by virtue of their participation in what the Company
considered as an "illegal strike."
V
It is well known that the scheme in Republic Act No. 875 for achieving
RESPONDENT COURT ERRED IN AFFIRMING THE TRIAL COURT'S FINDING, industrial peace rests essentially on a free and private agreement between
DESPITE THE SUBSTANTIAL CONTRARY EVIDENCE ON RECORD, THAT THE the employer and his employees as to the terms and conditions under which
STRIKERS RESORTED TO MEANS BEYOND THE PALE OF THE LAW IN THE the employer is to give work and the employees are to furnish labor,
PROSECUTION OF THE STRIKE AND IN DISREGARDING THE CONSIDERATION unhampered as far as possible by judicial or administrative intervention. On
THAT THE STRIKERS MERELY EMPLOYED LAWFUL ACTS OF SELF- this premise the lawmaking body has virtually prohibited the issuance of
PRESERVATION AND SELF-DEFENSE. injunctive relief involving or growing out of labor disputes.

VI The prohibition to issue labor injunctions is designed to give labor a


comparable bargaining power with capital and must be liberally construed to
RESPONDENT COURT ERRED IN AFFIRMING THE DISMISSAL BY THE TRIAL that end (U.S. vs. Brotherhood of Locomotive Engineers, 79 F. Supp. 485,
COURT OF J.J. MAPA, CAFIMSA'S PRESIDENT, AND OTHERS, OR IN OTHERWISE Certiorari denied, 69 S. Ct. 137, 335 U.S. 867, cause remanded on other
PENALIZING THE STRIKERS. grounds, 174 F. 2nd 160, 85 U.S. App. D.C., certiorari denied 70 S. Ct. 140, 338
U.S. 872, 94 L. Ed. 535). It is said that the prohibition creates substantive and
VII not purely procedural law. (Oregon Shipbuilding Corporation vs. National
Labor Relations Board, 49 F. Supp. 886). Within the purview of our ruling,
ASSUMING ARGUENDO THAT THE FACTS FOUND BY THE TRIAL COURT speaking through Justice Labrador, in Social Security Employees Association
SHOULD BE ACCEPTED, IN DISREGARD OF THE EVIDENCE PRESENTED BY THE (PAFLU), et al. vs. The Hon. Edilberto Soriano, et al. (G.R. No. L-20100, July 16,
COMPANY DAMAGING TO ITS CAUSE, OR ALTHOUGH THE TRIAL COURT 1964, 11 SCRA 518, 520), there can be no injunction issued against any strike
DISREGARDED THE SUBSTANTIAL INCRIMINATORY EVIDENCE AGAINST THE except in only one instance, that is, when a labor dispute arises in an industry
COMPANY, RESPONDENT COURT ERRED IN NOT APPLYING THE PRINCIPLE OF indispensable to the national interest and such dispute is certified by the
IN PARI DELICTO. President of the Philippines to the Court of Industrial Relations in compliance
with Sec. 10 of Republic Act No. 875. As a corollary to this, an injunction in an
VIII uncertified case must be based on the strict requirement See. 9 (d) of
Republic Act No. 875; the purpose of such injunction is not to enjoin the
RESPONDENT COURT ERRED IN FAILING TO HOLD THAT THE COMPANY IS strike itself, but only unlawful activities. To the extent, then, that the
BARRED UNDER SECTION 9(e) OF THE REPUBLIC ACT NO. 875 FROM SEEKING Company sought injunctive relief under Sec. 9(d) of Republic Act No.875,
THE RELIEF PRAYED FOR IN CASE NO. 1484-MC(1). respondent court had jurisdiction over the Company's "Urgent Petition"
dated April 26, 1965.
IX
As to the "contempt aspect" of Case No. 1484-MC(1), the jurisdiction of
RESPONDENT COURT ERRED IN ENTIRELY ABSOLVING THE COMPANY FROM respondent court over it cannot be seriously questioned it appearing that
THE UNFAIR LABOR PRACTICE CHARGE AND IN DISREGARDING THE Judge Tabigne in good faith thought that his "advice" to the Association
SUBSTANTIAL INCRIMINATORY EVIDENCE RELATIVE THERETO AGAINST THE during the hearing on March 29, 1965 not to strike amounted a valid order.
COMPANY. This is not to say, however, that respond court did not err in finding that the
advice given by Judgre Tabigne during the hearing on March 29, 1965 really
X constituted an order which can be the basis of a contempt proceeding. For, in
our opinion, what Judge Tabigne statement during said hearing should be March 8, 1965, giving reasons therefor any one of which is a valid ground for
construed what actually was — an advice. To say that it was an order would a strike.
be to concede that respondent court could validly enjoin strike, especially
one which is not certified in accord with Sec. 10 of Republic Act No. 875. To In addition, from the voluminous evidence presented by the Association, it is
adopt the view of respondent court would not only set at naught the policy clear that the strike of the Association was declared not just for the purpose
of the law as embodied in the said statute against issuance of injunctions, but of gaining recognition as concluded by respondent court, but also for
also remove from the hands of labor unions and aggrieved employees an bargaining in bad faith on the part of the Company and by reason of unfair
effective lawful weapon to either secure favorable action on their economic labor practices committed by its officials. But even if the strike were really
demand or to stop unfair labor practices on the part of their employer. declared for the purpose of recognition, the concerted activities of the
officers and members of the Association in this regard cannot be said to be
With respect to the alleged "illegality of the strike," as claimed by the unlawful nor the purpose thereof be regarded as trivial. Significantly, in the
Company, and the consequent forfeiture of the employee status of the voluntary return-to-work agreement entered into between the Company and
strikers, we believe these matters which are neither pertinent to nor the Association, thereby ending the strike, the Company agreed to recognize
connected with a certification case as opined by Judge Paredes, to which we for membership in the Association the position titles mentioned in Annex "B"
agree. Respondent court, therefore, initially erred in entertaining this issue in of said agreement.3 This goes to show that striking for recognition is
Case No. 1484-MC(1). No prejudice, however, has resulted since, as correctly productive of good result in so far as a union is concerned.
pointed out by respondent court, the illegality for the strike was squarely
raised by the Company as a defense in Case No. 4344-ULP and, in any event, Besides, one of the important rights recognized by the Magna Carta of Labor
we observe that the Association was given all the opportunity to put forward is the right to self-organization and we do not hesitate to say that is the
its evidence. cornerstone of this monumental piece of labor legislation. Indeed, because of
occasional delays incident to a certification proceeding usually attributable to
We now come to the important issue as to whether the strike staged by the dilatory tactics employed by the employer, to a certain extent a union may be
Association on April 22, 1965 is illegal. From an examination of the records, justified in resorting to a strike. We should not be understood here as
we believe that the lower court erred in its findings in this regard. advocating a strike in order to secure recognition of a union by the employer.
On the whole we are satisfied from the records that it is incorrect to say that
To begin with, we view the return-to-work agreement of May 30, 1965 as in the strike of the Association was mainly for the purpose of securing
the nature of a partial compromise between the parties and, more recognition as bargaining agent.
important, a labor contract; consequently, in the latter aspect the same
"must yield to the common good" (Art. 1700, Civil Code of the Philippines) As will be discussed hereinbelow, the charge of unfair labor practice against
and "(I)n case of doubt ... shall be construed in favor of the safety and decent the Company is well-taken. It is, therefore, clear error on the part of the
living for the laborer" (Art. 1702, ibid). To our mind when the Company Association is unjust, unreasonable and unwarranted.
unqualifiedly bound itself in the return-to-work agreement that all
employees will be taken back "with the same employee status prior to April We said earlier that the advice of Judge Tabigne to maintain the status quo
22, 1965," the Company thereby made manifest its intention and conformity cannot be considered as a lawful order within the contemplation of the
not to proceed with Case No. 1484-MC, (c) relating the illegality of the strike Magna Carta of Labor, particularly Section 10 thereof; to so regard it as an
incident. For while it is true that there is a reservation in the return-to-work order would be to grant respondent court authority to forbid a strike in an
agreement as follows: uncertified case which it is not empowered to do. The fact that the strike was
not staged until April 22, 1965 is eloquent proof enough of the desire of the
6. The parties agree that all Court cases now pending shall continue, Association and its officers and members to respect the advice of Judge
including CIR Case No. 1484-MC. Tabigne. However, as shown in this case during the pendency of the
certification proceedings unfair labor practices were committed by the
we think the same is to be construed bearing in mind the conduct and Company; hence, the Association was justified in staging a strike and certainly
intention of the parties. The failure to mention Case No. 1484-MC(1) while this is not in violation of the advice of Judge Tabigne on March 29, 1965.
specifically mentioning Case No. 1484-MC, in our opinion, bars the Company
from proceeding with the former especially in the light of the additional Respondent court picked out a number of incidents, taking place during the
specific stipulation that the strikers would be taken back with the same strike, to support its conclusion that the strikers resorted to means beyond
employee status prior to the strike on April 22, 1965. The records disclose the pale of the law in the prosecution of a strike. Thus, it made mention of
further that, according to Atty. Domingo E. de Lara when he testified on the blocking by a banca manned by two striking supervisors by the name of
October 9, 1965, and this is not seriously disputed by private respondents, Dominador Mangalino and one Bonecillo of the Caltex M/V Estrella when it
the purpose of Paragraph 10 of the return-to-work agreement was, to quote was about to depart; the blocking at the refinery of the Company in Bauan,
in part from this witness, "to secure the tenure of employees after the Batangas of the LSCO WARA, the Hills Bros Pinatubo, and the Mobil Visayas
return-to-work agreement considering that as I understand there were so that they could not dock; the blocking by the strikers of incoming vehicles,
demotions and suspensions of one or two employees during the strike and, non-striking supervisors, and rank-and-file workers to prevent them from
moreover, there was this incident Case No. 1484-MC(1)" (see Brief for the entering the refinery gate in Bauan, Batangas, at the Poro Terminal, at the
Petition pp. 41-42). To borrow the language of Justice J.B.L. Reyes in Citizens Company's Padre Faura office in Manila, and at the Pandacan Terminal; that
Labor Union Pandacan Chapter vs. Standard Vacuum Oil Company (G.R. No. L- at the Legaspi and Mambulao Bulk Depots the striking supervisors refused to
7478, May 6, 1955), in so far as the illegality of the strike is concerned in this surrender to their superiors the keys to the depots and storage tanks; and
proceeding and in the light of the records. that also at the Legaspi Depot the truck ignition keys were mixed up or
thrown at the seats of the trucks in violation of the Company regulations in
... the matter had become moot. The parties had both abandoned their order to create confusion and thus prevent the trucks from being used.4 To
original positions and come to a virtual compromise and agreed to resume refute these and similar findings of respondent court the Association,
unconditionally their former relations. To proceed with the declaration of drawing chiefly and abundantly from the Company's own evidence,5 called
illegality would not only breach this understanding, freely arrived at, but to attention to the exculpatory declarations of the Company's own witnesses6
unnecessarily revive animosities to the prejudice of industrial peace. either establishing or tending to establish that the picketing the strikers was
(Emphasis supplied) generally peaceful and orderly. We find that such, indeed, was the real
situation during the strike and it would be the height of injustice to rule
Conceding arguendo that the illegality incident had not become moot and otherwise in the face of the records before us.
academic, we find ourselves unable to agree with respondent court to the
effect that the strike staged by the Association on April 22, 1965 was In ignoring strong evidence coming from the witnesses of the Company
unjustified, unreasonable and unwarranted that it was declared in open damaging to its case as well as that adduced by the Association also
defiance of an order in Case No. 1484-MC not to strike; and that the damaging to the Company's case, we believe that respondent court clearly
Association resorted to means beyond the pale of the law in the prosecution and gravely abused its discretion thereby justifying us to review or alter its
of the strike. As adverted to above, the Association filed its notice to strike on factual findings (see Philippine Educational Institution vs. MLQSEA Faculty
Association, 26 SCRA 272, 278).7 There is thus here, to employ the language Let us now examine the charge of unfair labor practice which respondent
of Justice J.B.L. Reyes in Lakas ng Pagkakaisa sa Peter Paul vs. Court of court dismissed for lack of merit and substantial evidence.
Industrial Relations, 96 Phil., 63, "an infringement of cardinal primary rights
of petitioner, and justified the interposition of the corrective powers of this Under Sec. 14(c) of Republic Act No. 875, the parties themselves are required
Court (Ang Tibay vs. Court of Industrial Relations and National Labor Union, "to participate fully and promptly in such meetings and conferences as the
69 Phil., 635): (Conciliation) Service may undertake." In this case, the parties agreed to
meet on April 21, 1965 and yet, notwithstanding this definite agreement, the
(2) Not only must the party be given an opportunity to present his case and Company sent no representatives. The Company's claim to bargaining in good
to adduce evidence tending to establish the rights which he asserts but the faith cannot be given credence in the face of the fact that W.E. Menefee the
tribunal must consider the evidence presented. (Chief Justice Hughes in Company's Managing Director, conveniently left Manila for Davao on April 17
Morgan vs. U.S., 298 U.S. 468, 56 S. Ct. 906, 80 Law Ed. 1288.) In the language or 18, 1965, as admitted by W.E. Wilmarth. 10
of this Court in Edwards vs. McCoy, 22 Phil., 598, "the right to adduce
evidence, without the corresponding duty on the part of the board to Nowhere is there serious claim on the part of the Company that it entertains
consider it, is vain. Such right is conspicuously futile if the person or persons real doubt as to the majority representation of the Association. Consider
to whom the evidence is presented can thrust it aside without notice or further that admittedly the certification election proceeding for the Cebu
consideration." (Ibid., p. 67)8 Supervisors Union in the Company had been pending for six (6) years already.
From all appearances, therefore, and bearing in mind the deliberate failure of
We are convinced from the records that on the whole the means employed the Company to attend the conciliation meetings on April 19 and 21, 1965, it
by the strikers during the strike, taking into account the activities of the is clear that the Company employed dilatory tactics doubtless to discredit
Company and the non-striking employees on the same occasion, cannot be CAFIMSA before the eyes of its own members and prospective members as
labeled as unlawful; in other words, the Company itself through the an effective bargaining agent, postpone eventual recognition of the
provocative, if not unlawful, acts of the non-striking employees9 is not Association, and frustrate its efforts towards securing favorable action on its
entirely blameless for the isolated incidents relied upon by respondent court economic demands.
as tainting the picketing of the strikers with illegality. As we said through
Justice Fernando in Shell Oil Workers' Union vs. Shell Company of the It is likewise not disputed that on March 4, 1965, the Company issued its
Philippines, Ltd., statement of policy (Exh. B). At that time the Association was seeking
L-28607, May 31, 1971, 39 SCRA 276: recognition as bargaining agent and has presented economic demands for
the improvement of the terms and conditions of employment of supervisors.
6. Respondent court was likewise impelled to consider the strike illegal The statement of policy conveyed in unequivocal terms to all employees the
because of the violence that attended it. What is clearly within the law is the following message:
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 the We sincerely believe that good employee relations can be maintained and
unfair labor practice. That the law recognizes as a right. There is though a essential employee needs fulfilled through sound management
disapproval of the utilization of force to attain such an objective. For implicit administration without the necessity of employee organization and
in the very concept of a legal order is the maintenance of peaceful ways. A representations. We respect an employee's right to present his grievances,
strike otherwise valid, if violent, in character, be placed beyond the pale. Care regardless of whether or not he is represented by a labor organization.
is to be taken, however, especially where an unfair labor practice is involved, (Emphasis supplied)
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 An employee reading the foregoing would at once gain impression that there
such a case should be individual not collective. A different conclusion would was no need to join the Association. For he is free to present his grievances
be called for, of course, if the existence of force while the strike lasts is regardless of whether or not he is represented by a labor organization.
pervasive and widespread, consistently and deliberately resorted to as a
matter of policy. It could be reasonably concluded then that even if justified The guilty conduct of the Company before, during after the strike of April 22,
as to end, it becomes illegal because of means employed. (Ibid., p. 292; 1965 cannot escape the Court's attention. It will suffice to mention typical
emphasis supplied). instances by way of illustration. Long prior to the strike, the Company had
interferred with the Cebu Supervisors' Union by enticing Mapa into leaving
In the same case we further observed: the Union under the guise of promotion in Manila; shortly before the strike,
B.R. Edwards, Manager-Operations, had inquired into the formation and
... Barely four months ago, in Insular Life Assurance Co., Ltd. Employees' organization of the petitioner Association in this case. During the strike, in
Association vs. Insular Life Assurance Co., Ltd., there is the recognition by this addition to the culpable acts of the Company already narrated above, due
Court, speaking through Justice Castro, of picketing as such being "inherently significance must be given to the inclusion initially of J.J. Mapa and A.
explosive". It is thus clear that not every form of violence suffices to affix the Buenaventura, the Association's President and Vice-President respectively, in
seal of illegality on a strike or to cause the loss of employment of the guilty 1965, in two coercion cases filed at that time and their subsequent
party. (Ibid., pp. 293-294; emphasis supplied) elimination from the charges the initiative of the Company after the
settlement of strike; 11 the cutting off of telephone facilities extended
In the cited case of Insular Life Assurance Co., Employees' Association-NATO, Association members in the refinery; and the use of a member of the
FGU Insurance Group Workers & Employees Association-NATU and Insular Association to spy for the company. 12 The discriminatory acts practiced by
Life Building Employees Association-NATU vs. The Insular Life insurance Co., the Company against active unionists after the strike furnish further evidence
Ltd., FGU Insurance Group, et al., L-25291, January 30, 1971, 37 SCRA 244, we that Company committed unfair labor practices as charged. 13 Victims of
held through Justice Castro, and this is here applicable to the contention of discrimination are J.J. Mapa, A.E. Buenaventura, E.F. Grey, Eulogio Manaay,14
theAssociation, as follows: Pete Beltran, Jose Dizon, Cipriano Cruz, F.S. Miranda and many others. The
discrimination consisted in the Company's preferring non-members of the
... Besides, under the circumstances the picketers not legally bound to yield Association in promotions to higher positions and humiliating active unionists
their grounds and withdraw from the picket lines. Being where the law by either promoting junior supervisors over them or by reduction of their
expects them to be in the legitimate exercise of their rights, they had every authority compared to that assigned to them before the strike, or otherwise
reason to defend themselves and their rights from any assault or unlawful downgrading their positions. 15
transgression. ... (Ibid., p. 271)
Then, effective July 1, 1969, the Company terminated the employment of J.J.
In this cited case, by the way, we reversed and set aside the decision of the Mapa and Dominador Mangalino, President and Vice-President, respectively,
Court of Industrial Relations and ordered the Company to reinstate the of the Association at that time. And this the Company did not hesitate to do
dismissed workers backwages. notwithstanding the Association's seasonable appeal from respondent court's
decision. We perceive in this particular action of the Company its anti-union
posture and attitude. In this connection, we find merit in the claim of
petitioner that the dismissal of Mapa and Mangalino was premature
considering that respondent court did not expressly provide that such
dismissal might be effected immediately despite the pendency of the appeal
timely taken by the Association. The situation would have been different had
respondent court ordered the dismissal of Mapa and Mangalino immediately.
As the decision is silent on this matter the dismissal of said officers of the
Association ought to have been done only upon the finality of the judgment.
Because appeal was timely taken, the Company's action is patently
premature and is furthermore evidence of its desire to punish said active
unionists.

Verily, substantial, credible and convincing evidence appear on record


establishing beyond doubt the charge of unfair labor practices in violation of
Sec. 4 (a), Nos. (1), (3), (4), (5) and (6), of Republic Act No. 875. And pursuant
to the mandate of Art. 24 of the Civil Code of the Philippines that courts must
be vigilant for the protection of one at a disadvantage — and here the
Association appears to be at a disadvantage in its relations with the Company
as the records show — adequate affirmative relief, including backwages, must
be awarded to the strikers. It is high-time and imperative that in order to
attain the laudable objectives of Republic Act 875 calculated to safeguard the
rights of employees, the provisions thereof should be liberally construed in
favor of employees and strictly against employer, unless otherwise intended
by or patent from language of the statute itself.

The Court takes judicial notice of the considerable efforts exerted by both
parties in the prosecution of respective cases and the incidents thereof both
before lower court and this Court since 1965 to date. Under the
circumstances and in conformity with Art. 2208, No. 11, the Civil Code of the
Philippines, it is but just, fair and equitable that the Association be permitted
to recover attorney's fees as claimed in its tenth assignment of error.

WHEREFORE, respondent court's resolution en banc dated May 16, 1969,


together with the decision dated February 26, 1969, is reversed and
judgment is hereby rendered as follows:

1. In Case No. 1484-MC(1), the Court declares the strike of the Caltex
Filipino Managers and Supervisors' Association as legal in all respects and,
consequently, the forfeit of the employee status of J.J. Mapa, Dominador
Mangalino and Herminigildo Mandanas is set aside. The Company is hereby
ordered to reinstate J.J. Mapa and Dominador Mangalino to their former
positions without loss of seniority and privileges, with backwages from the
time of dismissal on July 1, 1969. Since Herminigildo Mandanas appears to
have voluntarily left the Company, no reinstatement is ordered as to him.

2. In Case No. 4344-ULP, the Court finds the Company B.F. Edwards and
W.E. Menefee guilty of unfair labor practices and they are therefore ordered
to cease and desist from the same. In this connection, the Company is
furthermore directed to pay backwages to the striking employees from April
22, 1965 to May 30, 1965 and to pay attorney's fees which are hereby fixed at
P20,000.00.

Costs against private respondents.