55.

Caltex Refinery Employees Association v

Brillantes
GR. No. 123783, September 16, 1997
Facts:
Anticipating the expiration of their CBA, petitioner and
private respondent negotiated the terms and conditions of
employment to be contained in a new CBA. The negotiation
between the two parties was participated in by the NCMB
and Office of Secretary of labor. Some items in the new CBA
were amicably arrived at and agreed upon, but others were
unresolved. To settle the issues, meetings were conducted
but to no avail. Petitioner declared a deadlock and followed
by filing of Notice of Strike. DOLE assumed jurisdiction
enjoining the strike or lockout. In defiance of the order,
petitioner continued with their mass action. Secretary of
Labor then issued orders- directing both parties to execute a
new CBA embodying the appropriate dispositions spelled out
including those subject of previous agreements; and that no
more motions will be further entertained.
Issue: Whether or not the Secretary of Labor and
Employment committed grave abuse of discretion in
resolving the instant labor dispute.
Ruling:
The Court held that the Secretary of Labor cannot be
indicated for grave abuse of discretion. Petitioners claim is
anchored only on the simple fact that public respondent
adopted largely the proposals of private respondent. It
should be understood that bargaining is not equivalent to an
adversarial litigation where rights and obligations are
delineated and remedies applied. It is simply a process of
finding a reasonable solution to a conflict and harmonizing
opposite positions into a fair and reasonable compromise.
When parties agree to submit unresolved issues to the
Secretary for resolution, they should not expect their
positions to be adopted in toto. It is understood that they
defer to wisdom and objectivity in insuring industrial peace.
And unless they can clearly demonstrate bias, arbitrariness,
capriciousness or personal hostility on the part of such
public officer, the Court will not interfere or substitute the
officers judgment with its own. This is particularly true in

resolving of controversies in CBAs where the question is

rarely one of legal right or wrong, but one of wisdom,
cogency and compromise as to what is possible, fair and
reasonable under the circumstances.

56.
University of the East v Pepanio
GR No. 193897, January 13, 2013
Abad. J.:
Facts:
In 1992, DECS issued a Revised Manual Regulations for
Private Schools which required college faculty members to
have a masters degree as a minimum educational
qualification for acquiring regular status. Petitioner UE and
UE Faculty executed a 5year CBA which provided an only
semester-to-semester appointments to faculty who do not
possess the minimum qualifications. A further order was
issued that teaching or academic personnel who do not
meet the minimum qualification shall not acquire tenure or
regular status. Respondents Bueno and Pepanio are not
qualified for probationary or regular status because they
lacked postgraduate degrees. A new CBA was entered
extending probationary provided it would be later complied.
Subsequently, UE allowed respondents extension for two
more semesters however the latter failed to oblige. Bueno
later demanded UE to consider her as regular employee
based on 6 year of full load service. LA held that both
Bueno and Pepanio were regular employees.
Issue: Whether or not UE illegally dismissed Bueno and
Pepanio.
Ruling:
The policy requiring postgraduate degrees of college
teachers was provided in the Manual of Regulations, in
which the UE recognized. As the Court held in Esparpizo v
Univ of Baguio, a school CBA must be read in conjunction
with statutory and administrative regulations governing
faculty qualifications. Such regulations form part of a valid
CBA without need for the parties to make express reference
to it. While the contracting parties may establish such

stipulations, clauses, terms and conditions, as they may see

fit, the right to contract is still subject to the limitation that
the agreement must not be contrary to law or public policy.
The requirement of a masteral degree for tertiary education
teachers is not unreasonable. The operation of educational
institution involves public interest. Herein, UE gave
respondents more than ample opportunities to acquire the
postgraduate degree required of them. But they do not take
advantage of such opportunities. Justice, fairness and due
process demand that an employer should not be penalized
for situations where it had little or no participation or
control.
57. ULP of Employer/Interference
Insular Life Assurance Employees Asso. v. Insular
Life, G.R. No. L-2529, January 30, 1971
FACTS:
The Insular Life Assurance Co., Ltd., Employees AssociationNATU, FGU Insurance Group Workers & Employees
Association-NATU, and Insular Life Building Employees
Association-NATU (hereinafter referred to as the Unions),
while still members of the Federation of Free Workers (FFW),
entered into separate collective bargaining agreements with
the Insular Life Assurance Co., Ltd. and the FGU
Insurance Group (hereinafter referred to as the
Companies).
The Unions jointly submitted proposals to the Companies,
modifying their respective CBA but after months of
negotiation, the Companies refused to submit their
respective counter-proposals, which prompted the former to
send notice of strike for deadlock on collective bargaining to
the DOLE. Even after the notice being given, the Union tried
to negotiate with the Company which became futile and 4
months after filing the notice to strike, the Unions decided to
pursue it. A few days before the day of strike, the
Companies promoted 87 unionist to supervisors with
increase in salary nor change in their respective
responsibilities. During the duration of the strike, the
Companies sent personal letters to the striker, which contain

the following: First letter promised benefits to entice the

strikers to return to work; the second letter threatened the
strikers that the will be replaced if they do not return to
work. Also the members of the managements of the
Companies tried to penetrate the picket line by sending 3
bus-loads of employees, including a photographer, forcing
their way into the gate where the picket was formed, thus
causing injuries to the strikers and to the strike-breakers due
to the resistance of the former. After which, the Companies
filed criminal cases against the strikers coupled with
injuction, the latter being granted by the court. Incidentally,
all of the more than 120 criminal charges filed against the
members of the Unions, except three (3), were dismissed by
the fiscal's office and by the courts. These three cases
involved "slight physical injuries" against one striker and
"light coercion" against two others.
The strikers, due to the threat of being replaced and the
injunction issued by the court, decided to report back to
work. However, the Companies required them to secure
clearances from the Prosecutors Office and be screened by
the management committee headed by the Unions former
officers, Garcia and Enage (they were hired by the
Companies as deputy corporate-secretary and assistant to
the head of the personnel department). The screening
committee initially rejected 83 strikers with pending criminal
charges and 34 officials of the Unions were adamantly
refused to be readmitted on the ground that they committed
acts inimical to the interest of the Companies, thus were
dismissed. However, all non-strikers with pending criminal
charges which arose from the breakthrough incident were
readmitted immediately by the Companies.
A complaint for ULP was filed against the Companies but the
Court of Industrial Relations dismissed the same for lack of
merit.
ISSUE: Whether the Companies committed ULP.

RULING: Yes, the Companies committed ULP through the

following:
1. In sending out individually to the strikers the letters;
2. For discriminating against the striking members of the
Unions in the matter of readmission of employees after the
strike;
3. For dismissing officials and members of the Unions
without giving them the benefit of investigation and the
opportunity to present their side in regard to activities
undertaken by them in the legitimate exercise of their right
to strike.
INTERFERENCE:
It is an unfair labor practice for an employer operating under
a collective bargaining agreement to negotiate or to attempt
to negotiate with his employees individually in connection
with changes in the agreement. And the basis of the
prohibition regarding individual bargaining with the strikers
is that although the union is on strike, the employer is still
under obligation to bargain with the union as the
employees' bargaining representative. The circumstance
that the strikers later decided to return to work ostensibly
on account of the injunctive writ issued by the Court of First
Instance of Manila cannot alter the intrinsic quality of the
letters, which were calculated, or which tended, to interfere
with the employees' right to engage in lawful concerted
activity in the form of a strike. Interference constituting
unfair labor practice will not cease to be such simply
because it was susceptible of being thwarted or resisted, or
that it did not proximately cause the result intended.
The test of whether an employer has interfered with and
coerced employees is whether the employer has engaged in
conduct which it may reasonably be said tends to interfere
with the free exercise of employees' rights and it is not
necessary that there be direct evidence that any employee
was in fact intimidated or coerced by statements of threats
of the employer if there is a reasonable inference that antiunion conduct of the employer does have an adverse effect
on self-organization and collective bargaining. Under the

TOTALITY OF CONDUCT DOCTRINE, the expressions of

opinion by an employer which, though innocent in
themselves, frequently were held to be culpable because of
the circumstances under which they were uttered, the
history of the particular employer's labor relations or antiunion bias or because of their connection with an
established collateral plan of coercion or interference.
58. ULP of Employer/Interference
Standard Chartered Bank Employees
Confesor, G.R. No. 114974, June 16, 2004

Union

v.

FACTS: Standard Chartered Bank (the Bank) is a foreign

banking corporation doing business in the Philippines. The
exclusive bargaining agent of the rank and file employees of
the Bank is the Standard Chartered Bank Employees Union
(the Union). Both parties entered into a CBA that can be
renogiated after 3 years of its effectivity. After the 3 rd year,
in preparation for renotiation, respective proposal were
submitted and the Union requested that no lawyer should be
part of the negotiating panel and the Bank requested that
Umali, an officer of the federation to which the Union was a
member of, be excluded from the panel as well. Except for
the provisions on signing bonus and uniforms, the
negotiations became futile, both as to economic and noneconomic provisions.
The Union filed a notice to strike due to deadlock before the
NCMD and the Bank filed a complaint of ULP with damages
before the NLRC alleging that the Union violated its duty to
bargain, as it did not bargain in good faith. It contended that
the Union demanded sky high economic demands,
indicative of blue-sky bargaining.[27] Further, the Union
violated its no strike- no lockout clause by filing a notice of
strike before the NCMB. Considering that the filing of notice
of strike was an illegal act, the Union officers should be
dismissed. Finally, the Bank alleged that as a consequence
of the illegal act, the Bank suffered nominal and actual

damages and was forced to litigate and hire the services of

the lawyer.
The Secretary of Labor (SOLE) assumed jurisdiction and
consolidating all the cases related to the issue. The SOLE
issued an order dismissing the ULP cases filed by both
parties and directing them to execute a CBA containing the
economic and non-economic provisions stated in the order,
while all the provisions in the expired CBA which were not
modified nor discussed are deemed retained.
ISSUE: Whether the Bank committed unfair labor practice
when
1. It interfered with the Unions choice of negotiator;
2. There was surface bargaining (violation of the duty to
bargain collectively when the Bank merely went through the
motions of collective bargaining without the intent to reach
an agreement; and
3. Refusal to furnish the Union with relevant data.
RULING: There was no ULP, petition was dismissed.
1. If an employer interferes in the selection of its negotiators
or coerces the Union to exclude from its panel of negotiators
a representative of the Union, and if it can be inferred that
the employer adopted the said act to yield adverse effects
on the free exercise to right to self-organization or on the
right to collective bargaining of the employees, ULP under
Article 248(a) in connection with Article 243 of the Labor
Code is committed. In order to show that the employer
committed ULP under the Labor Code, substantial evidence
is required to support the claim. Substantial evidence has
been defined as such relevant evidence as a reasonable
mind might accept as adequate to support a conclusion. [48]
In the case at bar, the Union bases its claim of interference
on the alleged suggestions of Diokno to exclude Umali from
the Unions negotiating panel. The circumstances that
occurred during the negotiation do not show that the
suggestion made by Diokno (from the Bank) to
Divinagracia(from the Union) is an anti-union conduct from

which it can be inferred that the Bank consciously adopted

such act to yield adverse effects on the free exercise of the
right to self-organization and collective bargaining of the
employees, especially considering that such was undertaken
previous to the commencement of the negotiation and
simultaneously with Divinagracias suggestion that the bank
lawyers be excluded from its negotiating panel. Moreover,
even with the request to exclude Umali from the negotiating
panel, the negotiation pushed through.
2. Surface bargaining is defined as going through the
motions of negotiating without any legal intent to reach an
agreement. The eveidence deduced in this case does not
substantiate the allegation that the Bank was surface
bargaining. The Bank replied with counter-proposals.
Admittedly, the parties were not able to agree and reached
a deadlock. However, it is herein emphasized that the duty
to bargain does not compel either party to agree to a
proposal or require the making of a concession.
3. The request for the relevant data was not put into writing,
when the Labor Code requires sending a written request for
the issuance of a copy of the data about the Banks rank
and file employees.
59. ULP of Employer/Interference
T&H Shopfitters v. T&H ShopfittersCorp.Gin Queen
Workers Union, G.R. No. 191714,
February 26, 2014
FACTS: The officers and/or members of THS-GQ union
(respondents), filed their Complaint7 for Unfair Labor
Practice (ULP) by way of union busting, and Illegal Lockout,
with moral and exemplary damages and attorneys fees,
against T&H Shopfitters Corporation (T&H Shopfitters) and
Gin Queen Corporation (GQ) (collectively referred to as
"petitioners"), before the Labor Arbiter.
In their desire to improve their working conditions,
respondents and other employees of petitioners had a

meeting to discuss the formation of a union. The following

day, seventeen (17) employees were barred from entering
petitioners factory premises located in Castillejos,
Zambales, and ordered to transfer to T&H Shopfitters
warehouse at Subic Bay Freeport Zone (SBFZ) purportedly
because of its expansion. Afterwards, the said seventeen
(17) employees were repeatedly ordered to go on forced
leave due to the unavailability of work. After which, the they
contended that the affected employees were not given
regular work assignments, while subcontractors were
continuously hired to perform their functions. Meanwhile,
the GQ was relocated to a talahiban, and the union
officers were made to work as grass cutters. Due to these
circumstances, the employees did not report to work which
eventually led to issuance of a show-cause letter for
termination because of insubordination by GQ.
Eventually, the Union was registered and an election was
scheduled. Before the election, the Petitioners conducted a
field trip wherein the members of the union were
purportedly excluded because the petitioners officers
campaigned against the union. The efforts of the petitioners
paid off because after the election, no union prevailed.
Respondents averred that the following week after the
certification elections were held, petitioners retrenched
THG-GQ Union officers and members assigned at the
Zambales plant. Respondents claimed that the work weeks
of those employees in the SBFZ plant were drastically
reduced to only three (3) days in a month.
The LA dismissed the complaint for ULP and all their money
claim for lack of merit. But on appeal to NLRC, the decision
was reversed; CA sustaince NLRCs decision.

ISSUE: Whether ULP acts were committed by petitioners

against respondents.
RULING: Yes, decision of NLRC and CA affirmed.
ULP relates to the commission of acts that transgress the
workers right to organize. As specified in Articles 248 [now
Article 257] and 249 [now Article 258] of the Labor Code,
the prohibited acts must necessarily relate to the workers'
right to self-organization. The concept of ULP is embodied in
Article 256 (formerly Article 247) of the Labor Code.
The questioned acts of petitioners, namely: 1) sponsoring a
field trip to Zambales for its employees, to the exclusion of
union members, before the scheduled certification election;
2) the active campaign by the sales officer of petitioners
against the union prevailing as a bargaining agent during
the field trip; 3) escorting its employees after the field trip to
the polling center; 4) the continuous hiring of subcontractors
performing respondents functions; 5) assigning union
members to the Cabangan site to work as grass cutters; and
6) the enforcement of work on a rotational basis for union
members, all reek of interference on the part of
petitioners.

60. No joining/withdrawal from Union (Yellow Dog

Contract)
Cathay Pacific Steel v. CA, G.R. No. 164561, August 30,
2006
FACTS: Petitioner is Cathay Pacific Steel Corporation
(CAPASCO), a domestic corporation engaged in the business
of manufacturing steel products; while the private
respondent
is Enrique Tamondong III, the Personnel
Superintendent of CAPASCO (which was considered by

CAPASCO as a managerial) who was previously assigned at

the petitioners' Cainta Plant, and CAPASCO Union of
Supervisory Employees (CUSE), a duly registered union of
CAPASCO. The supervisory personnel of CAPASCO launched
a move to organize a union among their ranks, later known
as private respondent CUSE. Private respondent Tamondong
actively involved himself in the formation of the union and
was even elected as one of its officers after its creation.
Consequently, petitioner CAPASCO sent a memo to private
respondent Tamondong requiring him to explain and to
discontinue from his union activities, with a warning that a
continuance thereof shall adversely affect his employment
in the company, which was ignored by the latter. CAPASCO
terminated the employment of private respondent
Tamondong on the ground of loss of trust and confidence,
citing his union activities as acts constituting serious
disloyalty to the company. Tamondong challenged his
dismissal for being illegal and as an act involving unfair
labor practice by filing a Complaint for Illegal Dismissal and
Unfair Labor Practice before the NLRC.
LA ruled in favour of Tamondong; reversed by NLRC for lack
of merit; via Petition for Certiorari, CA affirmed LAs decision
and ordered the reinstatement and payment of backwages
and other benefits by CAPASCO to Tamondong.
ISSUE: 1. Whether Peition for Certiorari is the proper
remedy; and 2. Whether Tamondong is a managerial
employee or supervisory employee, to accord him the right
to self-organization
RULING: Petition for Certiorari is not the petitioners proper
remedy and Tamandong is a supervisory employee, who
cannot be prohibited from joining and participating in the
union activites. Petition dismissed.
1. The essential requisites for a Petition for Certiorari under
Rule 65 are: (1) the writ is directed against a tribunal, a
board, or an officer exercising judicial or quasi-judicial
function; (2) such tribunal, board, or officer has acted

without or in excess of jurisdiction, or with grave abuse of

discretion amounting to lack or excess of jurisdiction; and
(3) there is no appeal or any plain, speedy, and adequate
remedy in the ordinary course of law. Third requisite is not
present in this case, the questioned Decision of the Court of
Appeals was already a disposition on the merits; this Court
has no remaining issues to resolve, hence, the proper
remedy available to the petitioners is to file Petition for
Review under Rule 45 not under Rule 65. Moreover, where
the issue or question involves or affects the wisdom or legal
soundness of the decision, and not the jurisdiction of the
court to render said decision, the same is beyond the
province of a petition for certiorari.
2. Tamondong was indeed a supervisory employee and not a
managerial employee, thus, eligible to join or participate in
the union activities of private respondent CUSE. He did not
perform any of the functions of a managerial employee as
stated in the definition given to it by the Code. Hence, the
Labor Code[33] provisions regarding disqualification of a
managerial employee from joining, assisting or forming any
labor organization does not apply to herein private
respondent Tamondong. At the most, the record merely
showed that Tamondong informed and warned rank-and-file
employees with respect to their violations of CAPASCO's
rules and regulations. Also, the functions performed by
private respondent such as issuance of warning ] to
employees with irregular attendance and unauthorized
leave of absences and requiring employees to explain
regarding charges of abandonment of work, are normally
performed by a mere supervisor, and not by a manager.
61. No joining/withdrawal from Union (Yellow Dog
Contract)
Cainta Catholic School v. Cainta Catholic School
Employees Union, G.R. No. 15102, May 4, 2006
FACTS: A CBA was entered into by the parties. In 1993, the
School retired 2 of the Union officers, Llagas and Javier, who

had rendered more than twenty (20) years of continuous

service, pursuant to Section 2, Article X of the CBA, to
wit:An employee may be retired, either upon application by
the employee himself or by the decision of the Director of
the School, upon reaching the age of sixty (60) or after
having rendered at least twenty (20) years of service to the
School the last three (3) years of which must be
continuous. Because of this, the Union filed a notice of
strike and 20 days after, the Union did so and picketed at
the Schools entrances. The Secretary of Labor (SOLE)
issued a return to work order and certified the dispute for
compulsory arbitration and status quo ante, including the
suspension of the termination of the 2 union officers. A
month after, the School filed a petition before the NLRC to
declare the strike illegal while the Union filed a complaint for
ULP.
NLRC ruled in favour of the School passing on 3 issues [(1)
whether the retirement of Llagas and Javier is legal; (2)
whether the School is guilty of unfair labor practice; and (3)
whether the strike is legal]. Union filed for Petition for
Certiorari before the Court with TRO, from which the latter
was granted. 10 regular teachers, who were declared to
have lost their employment status under the aforesaid NLRC
Resolution reported back to work but the School refused to
accept them by reason of its pending motion for
clarification. This prompted the Union to file a petition for
contempt. Consolidating all cases involved, the CA took
cognizance and ruled in favour of the Union and its officers
but dismissing the petition for contempt for lack of merit.
ISSUE: Whether a stipulation in a Collective Bargaining
Agreement (CBA) that allows management to retire an
employee in its employ for a predetermined lengthy period
but who has not yet reached the minimum compulsory
retirement age provided in the Labor Code valid. (This issue
prompted the strike and dismissal of other employees)
RULING: Valid. CAs decision reversed.

The termination of employment of Llagas and Javier is valid

because such arose from a management prerogative
granted by the mutually-negotiated CBA between the School
and the Union. There is no union-bustng in the case at bar
because retirement is a different species of termination of
employment from dismissal for just or authorized causes
under Articles 282 and 283 of the Labor Code. In those two
instances, it is indispensable that the employer establish the
existence of just or authorized causes for dismissal as
spelled out in the Labor Code. Retirement, on the other
hand, is the result of a bilateral act of the parties, a
voluntary agreement between the employer and the
employee whereby the latter after reaching a certain age
agrees and/or consents to sever his employment with the
former. The Code provides for retirement benefits in the
absence of a retirement plan or agreement for retirement
benefits of employees in the establishment. And by virtue of
their acceptance of the CBA, the Union and its members are
obliged to abide by the commitments and limitations they
had agreed to cede to management. The questioned
retirement provisions cannot be deemed as an imposition
foisted on the Union, which very well had the right to have
refused to agree to allowing management to retire retire
employees with at least 20 years of service. Hence, the
exercise by the employer of a valid and duly established
prerogative to retire an employee does not constitute unfair
labor practice.
Another point is that according to the Schools Faculty
Manual, the Dean of Student Affairs exercises managerial
functions, thereby classifying Llagas as a managerial
employee; while the position of Subject Area Coordinator
(javiers position) is classified as a supervisory employment
because Javier made recommendations as to what actions
to take in hiring, termination, disciplinary actions, and
management policies, among others. Having established
that Llagas is a managerial employee, she is proscribed
from joining a labor union,[38] more so being elected as union
officer. In the case of Javier, a supervisory employee, she
may join a labor union composed only of supervisory

employees.[39] Finding both union officers to be employees

not belonging to the rank-and-file, their membership in the
Union has become questionable, rendering the Union inutile
to represent their cause. Hence, the strike conducted was
illegal.
62. No joining/withdrawal from Union (Yellow Dog
Contract)
Purefoods v. NagkakaisangSamahangManggagawa ng
Purefoods, G.R. No. 150896, August 28, 2008
FACTS: The respondents in this case are 3 labor
organizations and a federation (PULO), NAGSAMA-Purefoods
is the exclusive bargaining agent of the rank-and-file
workers of Purefoods' meat division throughout Luzon,
STFWU for those in the farm in Sto. Tomas, Batangas, and
PGFWU for those in the poultry farm in Sta. Rosa, Laguna.
Together with its demands and proposal, the organizations
submitted to the company their respective General
Membership Resolution approving and supporting the
union's affiliation with PULO, adopting the draft CBA
proposals of the federation, and authorizing a negotiating
panel which included among others a PULO representative.
While Purefoods formally acknowledged receipt of the
union's proposals, it refused to recognize PULO and its
participation, even as a mere observer, in the negotiation.
Consequently, notwithstanding the PULO representative's
non-involvement, the negotiations of the terms of the CBA
still resulted in a deadlock.
A notice of strike was then filed by NAGSAMA-Purefoods on
May 15, 1995. In the subsequent conciliation conference,
the deadlock issues were settled except the matter of the
company's recognition of the union's affiliation with PULO.
On the other hand, the regular rank-and-file workers in the
Sto. Tomas farm were refused entry in the company
premises and 22 STFWU members were terminated from
employment after transferring the chickens from Sto.Tomas

to Malvar, Batangas. The farm manager, supervisors and

electrical workers of the Sto. Tomas farm, who were
members of another union, were nevertheless retained by
the company in its employ.
Aggrieved, the labor organizations filed a complaint for ULP,
illegal lock-out and dismissal, and damages before the
NLRC. The LA ruled in favour of the Company, which was
reversed by NLRC explaining that the petitioner company's
refusal to recognize the labor organizations' affiliation with
PULO was unjustified considering that the latter had been
granted the status of a federation by the Bureau of Labor
Relations; and that this refusal constituted undue
interference in, and restraint on the exercise of the
employees' right to self-organization and free collective
bargaining. The Company filed a Petition for Certiorari
before the CA, which the appellate court dismissed outright
the company's petition for certiorari on the ground that the
verification and certification of non-forum shopping was
defective since no proof of authority to act for and on behalf
of the corporation was submitted by the corporation's senior
vice-president who signed the same.
ISSUE: Whether the Company committed ULP and illegally
dismissed the union members.
RULING: Yes, dismissal by CA affirmed and ruling in favour of
the Unions by the NLRC affirmed.
The closure of the Sto. Tomas farm was made in bad faith.
Badges of bad faith are evident from the following acts of
the petitioner: it unjustifiably refused to recognize the
STFWU's and the other unions' affiliation with PULO; it
concluded a new CBA with another union in another farm
during the agreed indefinite suspension of the collective
bargaining negotiations; it surreptitiously transferred and
continued its business in a less hostile environment; and it
suddenly terminated the STFWU members, but retained and
brought the non-members to the Malvar farm. Petitioner
presented no evidence to support the contention that it was

incurring losses or that the subject farm's lease agreement

was pre-terminated.
The sudden termination of the STFWU members is tainted
with ULP because it was done to interfere with, restrain or
coerce employees in the exercise of their right to selforganization.
63. ULP/Contracting Out
Shell Oil Workers Union v. Shell Oil Company, G.R. No.
L-28607, May 31, 1971
FACTS: The Shell Company of the Philippines decided to
dissolve its security guard section, stationed at its Pandacan
Installation and consequesntly hired a private security
agency to undertake the work of the said securityguards,
notwithstanding its being embraced in, and its continuance
as such thus assured by an existing collective bargaining
contract, resulted in a strike called by petitioner Shell Oil
Workers' Union, which was certified a month later by the
Court of Industrial Relations.
The Union alleged that the eighteen (18) security guards
affected are part of the bargaining unit and covered by the
existing collective bargaining contract, and as such, their
transfers and eventual dismissals are illegal being done in
violation of the existing contract. On the other hand, the
Company maintained that in contracting out the security
service and redeploying the 18 security guards affected, it
was merely performing its legitimate prerogative to adopt
the most efficient and economical method of operation; that
said guards were transferred to other sections with increase,
except for four (4) guards, in rates of pay and with transfer
bonus; the said action was motivated by business
consideration in line with past established practice and
made after notice to and discussion with the Union; that the
18 guards concerned were dismiss for wilfully refusing to
obey the transfer order; and that the strike staged by the
Union on May 25, 1967 is illegal.

The Court of Industrial Relations declared that no unfair

labor practice was committed by Shell Company in
dissolving its security guards from an outside agency, as
such a step was well within management prerogative. Hence
for it, the strike was illegal, there being no compliance with
the statutory requisites before an economic strike could be
staged.
ISSUES: (1) whether or not the Company commits unfair
labor practice in contracting out its security service to an
independent professional security agency and assigning the
18 guards to other sections of the Company; and (2)
whether or not the strike called by the Union is legal.
RULING: Yes, the Company committed ULP when it violated
the CBA, thus, the strike called by the Union is legal.
While it is true that contracting out of services is a
management prerogative, when the same is subjected to
provisions of CBA, the latter should govern. Having said that
the Company had conducted studies on how to save costs is
security services are contracted out, it should have not
agreed on the stipulation n the CBA respecting the benefits
and privileges of its security guards (evidenced by
appendices in the CBA). The Shell Company, in failing to
manifest fealty to what was stipulated in an existing
collective bargaining contract, was thus guilty of an unfair
labor practice.
The strike cannot be declared illegal, there being a violation
of the collective bargaining agreement by Shell Company.
Even if it were otherwise, however, this Court cannot lend
sanction of its approval to the outright dismissal of all union
officers, a move that certainly would have the effect of
considerably weakening a labor organization, and thus in
effect frustrate the policy of the Industrial Peace Act to
encourage unionization. However, that the serious acts of
violence occurring in the course of the strike could be made
the basis for holding responsible a leader or a member of

the Union guilty of their commission, what was decided by

respondent Court should not be disturbed.

meantime. ULP charge by the Bank and the Union against

one another is dismissed for lack of merit, hence, this
petition for certiorari.

Case # 71
Standard Chartered v. Confesor, G.R. No. 114974,
June 16, 2004
(ULP-Blue sky bargaining)
Facts:
Standard Chartered Bank (the Bank) is a foreign banking
corporation doing business in the Philippines. The exclusive
bargaining agent of the rank and file employees of the Bank
is the Standard Chartered Bank Employees Union (the
Union).
Within the freedom period of the 5-year CBA signed by the
Bank and the Union, the latter, through its President Mr.
Divinagracia, sent a letter containing its proposal covering
political provisions and (34) economic provisions. The Bank,
through its Manager, Mr. Harris, attached its counterproposal to the non-economic provisions proposed by the
Union. During the negotiation, there were provisions on
which the Union and the Bank could not agree, hence, the
notation DEFERRED/DEADLOCKED was placed therein.
Despite the Unions proposal and the necessary revisions on
the counter-proposal of the Bank, both failed to agree on the
remaining economic provisions of the CBA. The Union
declared deadlock and filed Notice of Strike before NCMB
and the Bank filed a complaint for ULP and damages before
Arbitration Branch of the NLRC against the Union. The Bank
alleged that the Union violated its duty to bargain as it did
not bargain in good faith and it demanded sky high
economic demand, indicative of blue-sky bargaining.
Then Sec. of Labor Nieves Confesor, after the parties
submitted their respective position papers, issued an Order
ordering the Bank and the Union to execute a CBA
incorporating the dispositions contained therein effective for
two years thereafter or until such time as a new CBA has
superseded it, new provisions which are being demanded by
either party are deemed denied but without prejudice to
such agreements as the parties may have arrived in the

Issue: WON the Union engaged in the Blue-Sky Bargaining.

Held: We, likewise, do not agree that the Union is guilty of
ULP for engaging in blue-sky bargaining or making
exaggerated or unreasonable proposals.[59] The Bank failed
to show that the economic demands made by
the Union were exaggerated or unreasonable. The minutes
of the meeting show that the Union based its economic
proposals on data of rank and file employees and the
prevailing economic benefits received by bank employees
from other foreign banks doing business in the Philippines
and other branches of the Bank in the Asian region.
In sum, we find that the public respondent did not act with
grave abuse of discretion amounting to lack or excess of
jurisdiction when it issued the questioned order and
resolutions. While the approval of the CBA and the release
of the signing bonus did not estop the Union from pursuing
its claims of ULP against the Bank, we find that the latter did
not engage in ULP. We, likewise, hold that the Union is not
guilty of ULP. Petition is DISMISSED.
Case # 72
Octavio v. PLDT, G.R. No. 175492, February 27, 2013
(Grievance Machinery and Voluntary Arbitration- Jurisdiction)
Facts:
PLDT hired Octavio as Sales System Analyst I on a
probationary status in 2000 and became member of
GabayngUnyonsaTelekomunikasyonsamgaSuperbisor
(GUTS). Existing CBA then provides that effective 2001,
theres an increase of 12% of the basic wage or P2,500.00
whichever is higher. He was regularized in 2001 and was
promoted to the position of Sales Analyst 2 in 2002. PLDT
and GUTS entered into another CBA which provided for the
salary increases of 8% of basic wage or P2,000.00
whichever is higher for the first year (2002).

Octavio wrote the president of GUTS, Mr. Fajardo, claiming

that he was not given a salary increase in 2001 and 2002.
Acting thereon, Mr. Fajardo wrote the PLDT HRD for the
entitlement of the members to the across-the-board salary
increase. Grievance Committee, however, failed to reach an
agreement and in effect, denied Octavios demand for salary
increase. Aggrieved, Octavio filed before the Arbitration
Branch of the NLRC a complaint for payment of salary
increases.
Labor Arbiter dismissed the complaint and upheld the
Committee Resolution. On appeal, NLRC affirmed the Labor
Arbiters Decision finding that Octavios salary had been
already been adjusted in accordance with the provisions of
the CBA, further ruled that it has no jurisdiction as the same
involved the interpretation and implementation of the CBA.
According to it, Octavio should have brought his claim
before proper body as provided in the latest CBAs provision
on grievance machinery and procedure.
Issue: WON NLRC has jurisdiction over Octavios claim.
Held: No.Every Collective Bargaining Agreement (CBA) shall
provide a grievance machinery to which all disputes arising
from its implementation or interpretation will be subjected
to compulsory negotiations. This essential feature of a CBA
provides the parties with a simple, inexpensive and
expedient system of finding reasonable and acceptable
solutions to disputes and helps in the attainment of a sound
and stable industrial peace.
In its Memorandum,20 PLDT set forth the grievance
machinery and procedure provided under Article X of the
CBA of 2002-2004, viz:
Step 3. If the grievance is not settled either because
of deadlock or the failure of the committee to decide
the matter, the grievance shall be transferred to a
Board of Arbitrators for the final decision.
Indisputably, the present controversy involves the
determination of an employees salary increases as provided

in the CBAs. When Octavios claim for salary increases was

referred to the Union-Management Grievance Committee,
the clear intention of the parties was to resolve their
differences on the proper interpretation and implementation
of the pertinent provisions of the CBAs. And in accordance
with the procedure prescribed therein, the said committee
made up of representatives of both the union and the
management convened. Unfortunately, it failed to reach an
agreement. Octavios recourse pursuant to the CBA was to
elevate his grievance to the Board of Arbitrators for final
decision. Instead, nine months later, Octavio filed a
Complaint before the NLRC.
It is settled that "when parties have validly agreed on a
procedure for resolving grievances and to submit a dispute
to voluntary arbitration then that procedure should be
strictly observed."22 Moreover, we have held time and again
that "before a party is allowed to seek the intervention of
the court, it is a precondition that he should have availed of
all the means of administrative processes afforded him.
Hence, if a remedy within the administrative machinery can
still be resorted to by giving the administrative officer
concerned every opportunity to decide on a matter that
comes within his jurisdiction, then such remedy should be
exhausted first before the courts judicial power can be
sought.
Case # 73
Goya Inc. v. Goya Employees Union, G.R. No. 170054,
January 21, 2013
(Grievance Machinery and Voluntary Arbitration- Jurisdiction)
Facts: Petitioner Goya, Inc. (Company), a domestic
corporation engaged in the manufacture, importation, and
wholesale of top quality food products, hired contractual
employees from PESO Resources Development Corporation
(PESO) to perform temporary and occasional services in its
factory. This prompted respondent Goya, Inc. Employees
UnionFFW (Union) to request for a grievance conference on
the ground that the contractual workers do not belong to the

categories of employees stipulated in the existing CBA

which provides- Probationary, Regular and Casual
Employees. When the matter remained unresolved, the
grievance was referred to the NCMB for voluntary
arbitration.
Failure to agree at amicable settlement, both submitted for
resolution before the Voluntary Arbitrator (VA) Bienvenido E.
Laguesmathe solitary issue of "WON Company is guilty of
unfair labor acts in engaging the services of PESO, a third
party service provider, under the existing CBA, laws, and
jurisprudence."
The Union asserted that the hiring of contractual employees
from PESO is not a management prerogative and in gross
violation of the CBA tantamount to unfair labor practice
(ULP). It noted that the contractual workers engaged have
been assigned to work in positions previously handled by
regular workers and Union members, in effect violating CBA
with respect to categories of employees.
With the hiring of contractual employees, the Union
contended that it would no longer have probationary and
casual employees from which it could obtain additional
Union members; thus, rendering inutile Section 1, Article III
(Union Security) of the CBA.
In countering the Unions allegations, the Company argued
that: (a) the law expressly allows contracting and
subcontracting arrangements through DOLE Order No. 1802; (b) the engagement of contractual employees did not, in
any way, prejudice the Union, since not a single employee
was terminated and neither did it result in a reduction of
working hours nor a reduction or splitting of the bargaining
unit; and (c) Section 4, Article I of the CBA merely provides
for the definition of the categories of employees and does
not put a limitation on the Companys right to engage the
services of job contractors or its management prerogative to
address temporary/occasional needs in its operation.

VA Laguesma dismissed the Unions charge of ULP for being

purely speculative and for lacking in factual basis, but the
Company was directed to observe and comply with its
commitment under the CBA.
While the Union moved for partial reconsideration of the VA
Decision,the Company immediately filed a petition for
reviewbefore the Court of Appeals (CA) to set aside the
directive to observe and comply with the CBA commitment
pertaining to the hiring of casual employees when
necessitated by business circumstances, professing that
such order was not covered by the sole issue submitted for
voluntary arbitration. CA dismissed, hence, this petition.
Issue: WON the Voluntary Arbitrator had jurisdiction to rule
on the engagement of PESO, a third party service provider,
under existing CBA, laws and jurisprudence.
Held: Yes.We confirm that the VA ruled on a matter that is
covered by the sole issue submitted for voluntary
arbitration. Resultantly, the CA did not commit serious error
when it sustained the ruling that the hiring of contractual
employees from PESO was not in keeping with the intent
and spirit of the CBA. Indeed, the opinion of the VA is
germane to, or, in the words of the CA, "interrelated and
intertwined with," the sole issue submitted for resolution by
the parties. This being said, the Companys invocation of
Sections 4 and 5, Rule IVand Section 5, Rule VIof the Revised
Procedural Guidelines in the Conduct of Voluntary Arbitration
Proceedings dated October 15, 2004 issued by the NCMB is
plainly out of order. Petition is DENIED.
Case # 74
Ace Navigation Co., Inc. v. Fernandez, G.R. No.
197309, October 10, 2012
(Grievance Machinery and Voluntary Arbitration- Procedure)
Facts: In 2008, seaman Teodorico Fernandez (Fernandez),
assisted by his wife, Glenita Fernandez, filed with the NLRC a
complaint for disability benefitsagainst Ace Navigation Co.,
Inc., Vela International Marine Ltd., and/or Rodolfo

Pamintuan (petitioners).The petitioners moved to dismiss

the complaint contending that the labor arbiter had no
jurisdiction over thedispute. They argued that exclusive
original jurisdiction is with the voluntary arbitrator or panel
of voluntary arbitrators,pursuant to Section 29 of the POEA
Standard Employment Contract (POEA-SEC ), since the
parties are covered by the AMOSUP-TCC or AMOSUP-VELA
(as later cited by the petitioners) collective bargaining
agreement (CBA). Under Section 14 of the CBA, adispute
between a seafarer and the company shall be settled
through the grievance machinery and mandatory
voluntaryarbitration.Fernandez opposed the motion. He
argued that inasmuch as his complaint involves a money
claim, original andexclusive jurisdiction over the case is
vested with the labor arbiter.
Labor Arbiter Rioflorido denied the motion to dismiss,
holding that under Section 10 of RA No.8042, the Migrant
Workers and Overseas Filipinos Act of 1995, the labor arbiter
has original and exclusive jurisdiction overmoney claims
arising out of an employer-employee relationship or by
virtue of any law or contract, notwithstanding anyprovision
of law to the contrary. The petitioners appealed to the NLRC,
but the labor agency denied the appeal. Accordingly, it
remanded the case to the labor arbiter for further
proceedings. The petitioners moved for reconsideration, but
the NLRCdenied the motion, prompting the petitioners to
elevate the case to the CA through a petition for certiorari
under Rule 65 of the Rules of Court.
CA denied the petition on procedural and substantive
grounds. The CA clarified that while the law allows parties
tosubmit to voluntary arbitration other labor disputes,
including matters falling within the original and exclusive
jurisdiction of the labor arbiters under Article 217 of the
Labor Code as this Court recognized in Viverov. CA, the
parties submission agreement must be expressed in
unequivocal language. It found no such unequivocal
language in theAMOSUP/TCC CBA that the parties agreed to
submit money claims or, more specifically, claims for
disability benefits tovoluntary arbitration.Taking note of
Section 29 of the POEA-SEC, the CA explained that the

relevant POEA-SEC provisions should likewisebe qualified by

the ruling in the Vivero case, the Labor Code, and other
applicable laws and jurisprudence.In sum, the CA stressed
that the jurisdiction of voluntary arbitrators is limited to the
seafarers claims which do not fall within the labor arbiters
original and exclusive jurisdiction or even in cases where the
labor arbiter has jurisdiction, the parties have agreed in
unmistakable terms (through their CBA) to submit the case
to voluntary arbitration.The petitioners moved for
reconsideration of the CA decision, but the appellate court
denied the motion.
ISSUE:
Who has the original and exclusive jurisdiction over
Fernandezs disability claim the labor arbiter under
Section 10 of R.A. No. 8042, as amended, or the voluntary
arbitration mechanism as prescribed in the parties CBA and
the POEA
-SEC?
RULING:
We find merit in the petition. The States labor relations
policy laid down in the Constitution and fleshed out in the
enabling statute, the Labor Code (Art. 260, 261 and 262)
and the POEA-SEC provide that the voluntary arbitrator or
panel of voluntary arbitrators has original and exclusive
jurisdiction over Fernandezs disability claim. There is no
dispute that theclaim arose out of Fernandezs employment
with the petitioners and that their relationship is covered by
a CBA AMOSUP/TCC or the AMOSUP-VELA CBA. The CBA
provides for a grievance procedure for the resolution of
grievances ordisputes which occur during the employment
relationship and, like the grievance machinery created
under Article 261 of theLabor Code, it is a two-tiered
mechanism, with voluntary arbitration as the last step.
Contrary to the CAs reading of the CBAs Article 14, there is
unequivocal or unmistakable language in the agreement
which mandatorily requires the parties to submit to the
grievance procedure any dispute or cause of action they
may haveagainst each other.What might have caused the

CA to miss the clear intent of the parties in prescribing a

grievance procedure in their CBA is, as the petitioners have
intimated, the use of the auxiliary verb "may" in Article
14.7(a) of the CBA which providesthat "if by reason of the
nature of the Dispute, the parties are unable to amicably
settle the dispute, either party mayrefer the case to a
MANDATORY ARBITRATION COMMITTEE." While the CA did
not qualify its reading of the subject provision of the CBA, it
is reasonable to conclude that it viewedas optional the
referral of a dispute to the mandatory arbitration committee
when the parties are unable to amicably settle
thedispute.We find this a strained interpretation of the CBA
provision. The CA read the provision separately, or in
isolation of theother sections of Article 14, especially
14.7(h), which, in clear, explicit language, states that the
"referral of all unresolveddisputes from the Grievance
Resolution Committee to the Mandatory Arbitration
Committee shall be unwaivableprerequisite or condition
precedent for bringing any action, claim, or cause of action,
legal or otherwise, before anycourt, tribunal, or panel in any
jurisdiction" and that the failure by a party or seaman to so
refer the dispute to theprescribed dispute resolution
mechanism shall bar any legal or other action. Read in its
entirety, the CBAs Article 14 (Grievance Procedure)
unmistakably reflects the parties agreement tosubmit any
unresolved dispute at the grievance resolution stage to
mandatory voluntary arbitration under Article 14.7(h) of the
CBA. And, it should be added that, in compliance with
Section 29 of the POEA-SEC which requires that in cases of
claims and disputes arising from a seafarers employment,
the parties covered by a CBA shall submit the claim or
dispute to the original and exclusive jurisdiction of the
voluntary arbitrator or panel of voluntary arbitrators.
Since the parties used unequivocal language in their CBA for
the submission of their disputes to voluntaryarbitration, we
find that the CA committed a reversible error in its ruling. It
bears stressing at this point that we areupholding the
jurisdiction of the voluntary arbitrator or panel of voluntary
arbitrators over the present dispute, not only because of the
clear language of the parties CBA on the matter; more

importantly, we so uphold the voluntaryarbitrators

jurisdiction, in recognition of the States express preference
for voluntary modes of dispute settlement,such as
conciliation and voluntary arbitration as expressed in the
Constitution, the law and the rules.It is settled that when the
parties have validly agreed on a procedure for resolving
grievances and to submit adispute to voluntary arbitration
then that procedure should be strictly observed.
Case # 75
Club Filipino v. Bautista, G.R. No. 168406, July 13,
2009
(Strikes and Lockouts- Effect of a legal v. illegal strike)
Facts: Petitioner Club Filipino, Inc. (the company) is a nonstock, non profit corporation duly formed, organized and
existing under Philippine laws, with petitioner Atty. Roberto
F. de Leon as its president. Respondents Ronnie Sualog, Joel
Calida, Johnny Arinto and Roberto de Guzman, on the other
hand, were former officers and members of the Club Filipino
Employees Association (the union).
Prior to the expiration of the CBA on May 31, 2000 and
within the freedom period, the union made several demands
for negotiation but the company replied that it could not
muster a quorum, thus no CBA negotiations could be held.
Due to various reasons proffered by the company,
respondents, as officers of the union, filed a request for
preventive mediation with the NCMB but this, however,
failed to bring the management to the negotiating table.
Both only met with a declaration of a deadlock.
April 2001, the union filed a notice of strike with the NCMB
on the grounds of bargaining deadlock and failure to
bargain. Company submitted first part of its economic
counter-proposal. Meanwhile, May 2001, the union
conducted a strike vote under the supervision of the DOLE.
In response to the companys counter-proposal, the union
sent the company its improved proposal, but the company

refused to improve on its offer. This prompted the union to

stage a strike on May 26, 2001 on the ground of a CBA
bargaining deadlock.
The company filed before the NLRC a petition to declare the
strike illegal. The company further prayed that all union
officers who participated in the illegal strike be considered
separated from the service.
The labor arbiter declared the strike "procedurally [infirm]
and therefore illegal, the union failed to attach its written
CBA proposal and the companys counter-proposal to the
notice of strike and to provide proof of a request for a
conference to settle the dispute. On appeal, NLRC affirmed
the LA's decision.
CA, via petition for certiorari, set aside the rulings holding
that the NLRC and the labor arbiter "took a selective view of
the attendant facts of the case" and in "negating thereby
the effects of the notice of strike the union filed." What was
more, the NLRCs reasoning was flawed because "a worker
ordered dismissed under a tribunals decision has every
right to question his or her dismissal." The labor arbiters
ruling was likewise wrong because it was based on a "flimsy
technicality" that conveniently booted out the union officers
from the company, hence, this petition.
Issue: WON the strike staged by respondents on May 26,
2001 was legal.
Held: Yes.Rule XXII, Section 4 of the Omnibus Rules
Implementing the Labor Code states:
In cases of bargaining deadlocks, the notice shall, as far as
practicable, further state the unresolved issues in the
bargaining negotiations and be accompanied by the written
proposals of the union, the counter-proposals of the
employer and the proof of a request for conference to settle
differences. In cases of unfair labor practices, the notice
shall, as far as practicable, state the acts complained of, and
efforts taken to resolve the dispute amicably.

Any notice which does not conform with the requirements of

this and the foregoing section shall be deemed as not
having been filed and the party concerned shall be so
informed by the regional branch of the Board.
In the instant case, the union cannot be faulted for its
omission. The union could not have attached the counterproposal of the company in the notice of strike it submitted
to the NCMB as there was no such counter-proposal. To
recall, the union filed a notice of strike on April 6, 2001 after
several requests to start negotiations proved futile. It was
only on April 22, 2001, or after two weeks, when the
company formally responded to the union by submitting the
first part of its counter-proposal. Worse, it took the company
another three weeks to complete it by submitting on May
11, 2001 the second part of its counter-proposal. This was
almost a year after the expiration of the CBA sought to be
renewed.
The Implementing Rules use the words "as far as
practicable." In this case, attaching the counter-proposal of
the company to the notice of strike of the union was not
practicable. It was absurd to expect the union to produce
the companys counter-proposal which it did not have.
Another error committed by the labor arbiter was his
declaration
that
respondents,
as
union
officers,
automatically severed their employment with the company
due to the alleged illegal strike. In the first place, there was
no illegal strike. Moreover, it is hornbook doctrine that a
mere finding of the illegality of the strike should not be
automatically followed by the wholesale dismissal of the
strikers from employment.
The law is clear:
Any union officer who knowingly participates in an illegal
strike and any worker or union officer who knowingly
participates in the commission of illegal acts during a strike
may be declared to have lost his employment status.

Note that the verb "participates" is preceded by the adverb

"knowingly." This reflects the intent of the legislature to
require "knowledge" as a condition sine qua non before a
union officer can be dismissed from employment for
participating in an illegal strike.
WHEREFORE, the petition is hereby DENIED.
Case # 76
Visayas Community Medical Center v. Yballe, G.R. No.
196156, January 15,2014
(Strikes and Lockouts- Effect of a legal v. illegal strike)
Facts: Respondents were hired as staff nurses and midwives
by petitioner VCMC, formerly Metro Cebu Community
Hospital, Inc (MCCHI). The National Federation of Labor
(NFL) is the exclusive bargaining representative of the rankand-file employees of MCCHI. Perla Nava, president of
NagkahiusangMamumuosa MCCHI (NAMA-MCCHI-NFL) wrote
to MCCH Administrator expressing the union's desire to
renew the CBA, however, MCCHI returned the CBA proposal
to secure first the endorsement of NFL legal counsel as the
official bargaining representative of MCCHI employees.
NFL Legal Counsel Atty. Alforque informed MCCHI that the
proposed CBA was never referred to NFL and the latter has
not authorized any other legal counsel or any person for
collective bargaining negotiations. In view of the existing
conflict between federation and its local affiliate, check-off
was temporarily suspended by the MCCHI. Atty. Alforque
advised Nava that their group is not recognized by NFL.
In 1996, upon the request of Atty. Alforque, MCCHI granted
one-day union leave with pay for 12 union members. The
next day, several union members led by Nava and her group
launched a series of mass actions such as wearing black and
red armbands/headbands, marching around the hospital
premises and putting up placards, posters and streamers.
Atty. Alforque immediately disowned the concerted activities
being carried out by union members.
DOLE Regional Office issued certifications stating that there
is nothing in their records which shows that NAMA-MCCH-

NFL is a registered labor organization, and that said union

submitted only a copy of its Charter Certificate. MCCHI then
sent individual notices to all union members asking them to
submit written explanation why they should not be
terminated for having supported the illegal concerted
activities of NAMA-MCCH-NFL which has no legal personality
as per DOLE records.
NCMB, upon filing of Notice to Strike by NAMA-MCCH-NFL,
denied the same for want of legal personality. Despite such
rebuff, Nava and her group still conducted and approved a
strike vote. More than 100 striking employees were
dismissed for continued picketing activities. Unfazed, the
striking union members held more mass actions. With the
volatile situation, MCCHI filed a petition for injunction with
the NLRC in which the same was granted with permanent
injunction issued.
Due to several complaints for illegal dismissal and ULP by
the terminated employees, Executive Labor Arbiter
ReynosoBelarmino ruled that MCCHI and its administrators
were not guilty of ULP and likewise upheld the termination of
complainant union officers who conducted the illegal strike.
But NAMA members, who cannot be held responsible for an
illegal strike on the sole basis of such membership, are
being liable only if they actually participated therein.
Respondents and their co-complainants filed before NLRC
their respective appeals. NLRC affirmed the decision. Thus, a
petition for certiorari was filed before CA who likewise
dismissed the same.
The present petition was included in the four consolidated
cases previously decided by this court. Respondents claim
that they have consistently manifested their nonparticipation in the illegal strike and argue that there is
absolutely no reason to delete the awards and separation
pay in lieu of reinstatement. Petitioner, on the other hand,
contends that respondents have surreptitiously changed
their position as facts on records established that they
signed the collective reply of the union members and
acknowledged Nava as their union leader.

Issue: WON respondents who were mere union members

were illegally dismissed and if so, entitled to reinstatement
and full backwages.
Held: Illegally dismissed. The Supreme Court stressed that
the law makes a distinction between union members and
union officers. A union member who merely participates in
an illegal strike may not be terminated from employment. It
is only when he commits illegal acts during a strike that he
may be declared to have lost employment status. In
contrast, a union officer may be terminated from
employment for knowingly participating in an illegal strike or
participates in the commission of illegal acts during a strike.
The law grants the employer the option of declaring a union
officer who participated in an illegal strike as having lost his
employment. It possesses the right and prerogative to
terminate the union officers from service.
NAMA-MCCH-NFL is not a legitimate labor organization, thus,
the strike staged by its leaders and members was declared
illegal. The union leaders who conducted the illegal strike
despite knowledge that NAMA-MCCH-NFL is not a duly
registered labor union were declared to have been validly
terminated by petitioner. However, as to the respondents
who were mere union members, it was not shown that they
committed any illegal act during the strike. The Labor
Arbiter and the NLRC were one in finding that respondents
actively supported the concerted protest activities, signed
the collective reply of union members manifesting that they
launched the mass actions to protest managements refusal
to negotiate a new CBA, refused to appear in the
investigations scheduled by petitioner because it was the
unions stand that they would only attend these
investigations as a group, and failed to heed petitioners
final directive for them to desist from further taking part in
the illegal strike. The CA, on the other hand, found that
respondents participation in the strike was limited to the
wearing of armbands. Since an ordinary striking worker
cannot be dismissed for such mere participation in the
illegal strike, the CA correctly ruled that respondents were
illegally dismissed. However, the CA erred in awarding

respondents full back wages and ordering their

reinstatement despite the prevailing circumstances.
Are respondents then entitled to back wages? This Court, in
G & S Transport Corporation v. Infante, ruled in the negative:
The alternative relief for union members who were
dismissed for having participated in an illegal strike is the
payment of separation pay in lieu of reinstatement under
the following circumstances: (a) when reinstatement can no
longer be effected in view of the passage of a long period of
time or because of the realities of the situation; (b)
reinstatement is inimical to the employers interest; (c)
reinstatement is no longer feasible; (d) reinstatement does
not serve the best interests of the parties involved; (e) the
employer is prejudiced by the workers continued
employment; (f) facts that make execution unjust or
inequitable have supervened; or (g) strained relations
between the employer and employee.
In the Decision dated December 7, 2011, we held that the
grant of separation pay to complainants is the appropriate
relief under the circumstances, thus:
Considering that 15 years had lapsed from the onset of this
labor dispute, and in view of strained relations that ensued,
in addition to the reality of replacements already hired by
the hospital which had apparently recovered from its huge
losses, and with many of the petitioners either employed
elsewhere,
already
old and
sickly,
or
otherwise
incapacitated, separation pay without back wages is the
appropriate relief. x xx
In fine, we sustain the CA in ruling that respondents who are
mere union members were illegally dismissed for
participating in the illegal strike conducted by the Nava
group. However, we set aside the order for their
reinstatement and payment of full back wages.
Case # 77
Santa Rosa Coca Cola Plant Employees Union v. CocaCola Bottlers, G.R. Nos. 164302-03, January 24, 2007
(Strikes and Lockouts-Picketing; Innocent Bystander)

Facts: The Sta. Rosa Coca-Cola Plant Employees Union

(Union) is the sole and exclusive bargainingrepresentative of
the regular daily paid workers and the monthly paid noncommission-earning employees of the Coca-Cola Bottlers
Philippines, Inc. (Company) in its Sta. Rosa, Laguna plant.
Upon the expiration of the CBA, the Union informed the
Company of its desire to renegotiate its terms. The CBA
meetings commenced on July 26, 1999, where the Union
and the Company discussed the ground rules of the
negotiations. The Union insisted that representatives from
the AlyansangmgaUnyonsa Coca-Cola be allowed to sit
down as observers in the CBA meetings. The Union officers
and members also insisted that their wages be based on
their work shift rates. For its part, the Company was of the
view that the members of the Alyansa were not members of
the bargaining unit. The Alyansa was a mere aggregate of
employees of the Company in its various plants; and is not a
registered labor organization. Thus, an impasse ensued.
On August 30, 1999, the Union, its officers, directors and six
shop stewards filed a Notice of Strike with the NCMB.
The Union decided to participate in a mass action organized
by the Alyansa in front of the Companys premises. Thus,
the Union officers and members held a picket along the front
perimeter of the plant on September 21, 1999. As a result,
all of the 14 personnel of the Engineering Section of the
Company did not report for work, and 71 production
personnel were also absent. As a result, only one of the
three bottling lines operated during the day shift. All the
three lines were operated during the night shift with
cumulative downtime of five (5) hours due to lack of
manning, complement and skills requirement. The volume of
production for the day was short by 60,000 physical cases
versus budget.
On October 13, 1999, the Company filed a Petition to
Declare Strike Illegal

Issue: WON the strike, dubbed by petitioner as picketing, is

illegal.
Held: Article 212(o) of the Labor Code defines strike as a
temporary stoppage of work by the concerted action of
employees as a result of an industrial or labor dispute. In
Bangalisan v. CA, the Court ruled that the fact that the
conventional term strike was not used by the striking
employees to describe their common course of action is
inconsequential, since the substance of the situation, and
not its appearance, will be deemed to be controlling.
Picketing involves merely the marching to and fro at the
premises of the employer, usually accompanied by the
display of placards and other signs making known the facts
involved in a labor dispute. As applied to a labor dispute, to
picket means the stationing of one or more persons to
observe and attempt to observe. The purpose of pickets is
said to be a means of peaceable persuasion.
The basic elements of a strike are present in this case. They
marched to and fro in front of the companys premises
during working hours. Thus, petitioners engaged in a
concerted activity which already affected the companys
operations. The mass concerted activity constituted a strike.
For a strike to be valid, the following procedural requisites
provided by Art 263 of the Labor Code must be observed:
(a) a notice of strike filed with the DOLE 30 days before the
intended date thereof, or 15 days in case of unfair labor
practice; (b) strike vote approved by a majority of the total
union membership in the bargaining unit concerned
obtained by secret ballot in a meeting called for that
purpose, (c) notice given to the DOLE of the results of the
voting at leastseven days before the intended strike. These
requirements are mandatory and the failure of a union to
comply therewith renders the strike illegal. It is clear in this
case that petitioners totally ignored the statutory
requirements and embarked on their illegal strike.Petition
denied.

78.
MSF Tire and Rubber, Inc. vs. CA
Facts:
A labor dispute arose between Philtread Tire and
Rubber Corporation (Philtread) and private respondent,
Philtread Tire Workers' Union (Union), filed a notice of strike
in the National Conciliation and Mediation Board (NCMB).
Charging Philtread with unfair labor practices for allegedly
engaging in union-busting for violation of the provisions of
the collective bargaining agreement. Philtread, on the other
hand, filed a notice of lock-out.
During the pendency of the labor dispute, Philthread
entered into a memorandum of agreement (MOA) with Siam
Tyre Public Company Limited (Siam Tyre). Under the
Memorandum of Agreement, Philtread's plant and
equipment would be sold to a new company (petitioner MSF
Tire and Rubber, Inc.), 80% of which would be owned by
Siam Tyre and 20% by Philtread, while the land on which the
plant was located would be sold to another company (Sucat
Land Corporation), 60% of which would be owned by
Philtread and 40% by Siam Tyre.
Petitioner (MSF) then asked the Union to desist from
picketing outside its plant and to remove the banners,
streamers, and tent which it had placed outside the plant's
fence. Union refused.
Petitioner filed a complaint for injunction with
damages against the Union and the latter's officers and
directors before the Regional Trial Court. RTC denied
Petitioners application for injunction and dismissed the
complaint. However, upon MR, RTC granted the Injunction
and Plaintiffs complaint reinstated. The Union elevated the
case to CA which granted the Unions petition ordering the
RTC to dismiss the civil case for lack of jurisdiction.
Issue:

Whether Petitioner is an innocent bystander with

respect to the labor dispute between Philtread and the
Union entitles it to Writ of Injunction from the civil courts?
Held:
No. An "innocent bystander," who seeks to enjoin a
labor strike, must satisfy the court that aside from the
grounds specified in Rule 58 of the Rules of Court, it is
entirely different from, without any connection whatsoever
to, either party to the dispute and, therefore, its interests
are totally foreign to the context thereof.
For instance, in PAFLU v.Cloribel, supra, this Court
held that Wellington and Galang were entirely separate
entities, different from, and without any connection
whatsoever to, the Metropolitan Bank and Trust Company,
against whom the strike was directed, other than the
incidental fact that they are the bank's landlord and colessee housed in the same building, respectively.
Similarly,
in Liwayway
Publications, Inc. v. Permanent Concrete Workers Union, this
Court ruled that Liwayway was an "innocent bystander" and
thus entitled to enjoin the union's strike because Liwayway's
only connection with the employer company was the fact
that both were situated in the same premises.
In the present case, the "negotiation, contract of
sale, and the post transaction" between Philtread, as
vendor, and Siam Tyre, as vendee, reveals a legal relation
between them which, in the interest of petitioner, the
transaction between Philtread and Siam Tyre, was not a
simple sale whereby Philtread ceased to have any
proprietary rights over its sold assets. This, together with
the fact that private respondent uses the same plant or
factory; similar or substantially the same working
conditions; same machinery, tools, and equipment; and
manufacture the same products as Philtread, lead us to

safely conclude that private respondent's personality is so

closely linked to Philtread as to bar its entitlement to an
injunctive writ.
Petition Denied.

79.
Club Filipino vs. Bautista, et. al.
Facts:
Club Filipino is a non-stock, non-profit corporation
duly formed, organized and existing under Philippine laws,
with petitioner Atty. Roberto F. de Leon as its
president. Respondents were former officers and members
of the Club Filipino Employees Association (the union).
The union and the company had a collective
bargaining agreement (CBA) which expired on May 31,
2000. Prior to the expiration of the CBA and within the
freedom period, the union made several demands for
negotiation but the company replied that it could not muster
a quorum, thus no CBA negotiations could be held. No
negotiations, however, took place for various reasons
proffered by the company, among them the illness of the
chairman of the management panel.
Union filed a request for preventive mediation with
NCMB. However, the Union still failed to bring the
management to the negotiating table. The union and
management only met on April 5, 2001, but the meeting
concluded with a declaration by both parties of a deadlock
in their negotiations.
Union filed a notice of strike with the NCMB on the
grounds of bargaining deadlock and failure to bargain. The
company filed before the National Labor Relations
Commission (NLRC) a petition to declare the strike illegal.

The company further prayed that all union officers who

participated in the illegal strike be considered separated
from the service.
The Labor Arbiter declared the strike procedurally
infirm and therefore illegal. The labor arbiter noted that the
union failed to attach its written CBA proposal and the
companys counter-proposal to the notice of strike and to
provide proof of a request for a conference to settle the
dispute. NLRC affirmed the Labor Arbiters decision. CA set
aside the rulings of the NLRC.
Issue:
Whether or not the strike staged by respondents was
legal?
Held:
Yes. Rule XXII, Section 4 of the Omnibus Rules
Implementing the Labor Code states: In cases of bargaining
deadlocks, the notice shall, as far as practicable, further
state the unresolved issues in the bargaining negotiations
and be accompanied by the written proposals of the union,
the counter-proposals of the employer and the proof of a
request for conference to settle differences. In cases of
unfair labor practices, the notice shall, as far as practicable,
state the acts complained of, and efforts taken to resolve
the dispute amicably.
Any notice which does not conform with the
requirements of this and the foregoing section shall be
deemed as not having been filed and the party concerned
shall be so informed by the regional branch of the Board.
In the instant case, the union cannot be faulted for
its omission. The union could not have attached the counterproposal of the company in the notice of strike it submitted
to the NCMB as there was no such counter-proposal.The
union filed a notice of strike on April 6, 2001 after several

requests to start negotiations proved futile. It was only on

April 22, 2001, or after two weeks, when the company
formally responded to the union by submitting the first part
of its counter-proposal. Worse, it took the company another
three weeks to complete it by submitting on May 11, 2001
the second part of its counter-proposal. This was almost a
year after the expiration of the CBA sought to be renewed.
In this case, attaching the counter-proposal of the
company to the notice of strike of the union was not
practicable. It was absurd to expect the union to produce
the companys counter-proposal which it did not have. One
cannot give what one does not have. Indeed, compliance
with the requirement was impossible because no counterproposal existed at the time the union filed a notice of
strike. The law does not exact compliance with the
impossible. Nemoteneturadimpossibile.
Another error committed by the labor arbiter was his
declaration
that
respondents,
as
union
officers,
automatically severed their employment with the company
due to the alleged illegal strike. In the first place, there was
no illegal strike. Moreover, it is hornbook doctrine that a
mere finding of the illegality of the strike should not be
automatically followed by the wholesale dismissal of the
strikers from employment.
The
Law
said:
Any
union
officer
who knowingly participates in an illegal strike and any
worker or union officer who knowingly participates in the
commission of illegal acts during a strike may be declared
to have lost his employment status.
This reflects the intent of the legislature to require
knowledge as a condition sine qua non before a union
officer can be dismissed from employment for participating
in an illegal strike.
Petition Denied.

80.
PLDT
Pilipinas
Facts:

vs.

Manggagawang

Komunikasyon

sa

The members of respondent union learned that a

redundancy program would be implemented by the
petitioner. Thereupon it filed a Notice of Strike with the
NCMB alleging Unfair Labor Practice against PLDT. A number
of conciliation meetings, conducted by the NCMB, were held
between the parties. However, these efforts proved futile.
The private respondent staged a strike. 383 Union
members were terminated from service pursuant to PLDTs
redundancy program. Secretary Patricia Sto. Tomas issued
an Order stating:
Strike staged by the Union is hereby enjoined. All striking
workers are hereby directed to return to work within twenty
four (24) hours from receipt of this Order, except those who
were terminated due to redundancy.
Motion for Partial Reconsideration was filed by the Private
Respondents. Secretary Issued an Order which referred the
case to the NLRC for appropriate action.
Private Respondent however, elevated the case to the CA.
The latter granted the Petition and Set Aside and nullified
the Order of Secretary.
Issue:
1. Whether or not Special Civil Action for Certiorari
instituted by Respondents before the CA was
procedurally Precise?
2. Whether the subject orders of the Secretary of DOLE
excluding from the Return to Work order the workers
dismissed due to the redundancy program of
petitioner valid or not?

Held:
1. Yes. The institution of the special civil action
for certiorari before the Court of Appeals was
procedurally sound. In a special civil action
of certiorari, the only question that may be raised is
whether or not the respondent has acted without or
in excess of jurisdiction or with grave abuse of
discretion.
The respondent asserted in the court a quo that the
Secretary violated the law and jurisprudence, and exceeded
her authority when she expressly prevented from returning
to work those who were terminated due to alleged
redundancy while the strike was ongoing.
2. Petition must fail. When the Secretary exercises the
powers granted by Article 263(g) of the Labor Code,
he is, indeed, granted great breadth of discretion.
Art 263. Strikes, picketing, and lockouts.
(g) When in his opinion, there exists a labor dispute causing
or likely to cause a strike or lockout in an industry
indispensable to the national interest, the Secretary of
Labor and Employment may assume jurisdiction over the
dispute and decide it or certify the same to the Commission
for compulsory arbitration. Such assumption or certification
shall have the effect of automatically enjoining the intended
or impending strike or lockout as specified in the
assumption or certification order. If one has already taken
place at the time of assumption or certification, all striking
or locked out employees shall immediately return to work
and the employer shall immediately resume operations and
readmit all workers under the same terms and conditions
prevailing before the strike or lockout.
From the foregoing, it is quite apparent that no matter how
broad the exercise of discretion is, the same must be within
the confines of law. Thus, the wide latitude of discretion

given the Secretary under Art. 263(g) shall and must be

within the sphere of law.
As Article 263(g) is clear and unequivocal in stating that ALL
striking or locked out employees shall immediately return to
work and the employer shall immediately resume
operations and readmit ALL workers under the same terms
and conditions prevailing before the strike or lockout, then
the unmistakable mandate must be followed by the
Secretary.
Members of the private respondent who were dismissed due
to alleged redundancy were still employed by the petitioner
and holding their respective positions. This is the status
quo that must be maintained.
81.
Capitol Medical Center vs. Trajano
Facts:
Capitol Medical Centeris a hospital with address at
Panay Avenue corner Scout Magbanua Street, Quezon City.
Upon the other hand, Capitol Medical Center Employees
Association-Alliance of Filipino Workers,respondent, is a duly
registered labor union acting as the certified collective
bargaining agent of the rank-and-file employees of
petitioner hospital.
Respondent union, sent petitioner a letter requesting
a negotiation of their Collective Bargaining Agreement
(CBA). Petitioner, challenging the unions legitimacy, refused
to bargain with respondent. Subsequently, Petitioner filed
with the Bureau of Labor Relations (BLR), Department of
Labor and Employment, a petition for cancellation of
respondents certificate of registration.
Respondent Union filed with the National Conciliation
and Mediation Board (NCMB), National Capital Region, a
notice of strike. Despite several conferences and efforts of

the designated conciliator-mediator, the parties failed to

reach an amicable settlement.
Former Labor Secretary Leonardo A. Quisumbing,
issued an Order assuming jurisdiction over the labor dispute
and ordering all striking workers to return to work and the
management to resume normal operations.
Petitioner filed with this Court a petition
for certiorari assailing the Labor Secretarys Orders before
the CA.
Regional Director, issued an Order denying the
petition for cancellation of respondent unions certificate of
registration. CA rendered a Decision affirming the Orders of
the Secretary of Labor.

Issue:
1. Whether Petition for cancellation of respondents
Unions certificate of registration involves a
prejudicial question that should be settled before
the Secretary of Labor could order the parties to
bargain collectively?
2. Whether the Secretary of Labor cannot exercise
his power under Article 263(g) without observing
the requirments of due process?
Held:
1. No. Pendency of a petition for cancellation of
union registration does not preclude collective
bargaining.
That there is a pending cancellation proceedings against the
respondent Union is not a bar to set in motion the

mechanics of collective bargaining. If a certification election

may still be ordered despite the pendency of a petition to
cancel the unions registration certificate, more so should
the collective bargaining process continue despite its
pendency.
Majority status of the respondent Union is not affected by
the pendency of the Petition for Cancellation pending
against it. Unless its certificate of registration and its status
as the certified bargaining agent are revoked, the Hospital
is, by express provision of the law, duty bound to collectively
bargain with the Union.
2. In labor disputes adversely affecting the
continued operation of such hospitals, clinics or
medical institutions, it shall be the duty of the
striking union or locking-out employer to provide
and maintain an effective skeletal workforce of
medical and other health personnel, whose
movement and services shall be unhampered and
unrestricted, as are necessary to insure the
proper and adequate protection of the life and
health of its patients, most especially emergency
cases, for the duration of the strike or lockout. In
such cases, therefore, the Secretary of Labor and
Employment is mandated to immediately
assume, within twenty-four (24) hours from
knowledge of the occurrence of such a strike or
lockout, jurisdiction over the same or certify it to
the Commission for compulsory arbitration. For
this purpose, the contending parties are strictly
enjoined to comply with such orders, prohibitions
and/or injunctions as are issued by the Secretary
of Labor and Employment or the Commission,
under pain of immediate disciplinary action,
including dismissal or loss of employment status
or payment by the locking-out employer of
backwages, damages and other affirmative relief,
even criminal prosecution against either or both
of them.

The President of the Philippines shall not be precluded from

determining the industries that, in his opinion, are
indispensable to the national interest, and from intervening
at any time and assuming jurisdiction over any such labor
dispute in order to settle or terminate the same.
Discretion to assume jurisdiction may be exercised by the
Secretary of Labor and Employment without the necessity of
prior notice or hearing given to any of the parties. The
rationale for his primary assumption of jurisdiction can
justifiably rest on his own consideration of the exigency of
the situation in relation to the national interests.
Petition Denied.
82.
Phimco Industries Inc. vs. Brillantes
Facts:
Phimco Industries Labor Association (PILA) filed a
notice of strike with the National Conciliation and Mediation
Board, NCR, against PHIMCO after a deadlock in the
collective bargaining and negotiation. After several
conciliation conferences called by the contending parties
failed to resolve their differences PILA, staged a strike.
PILA presented a petition for the intervention of the
Secretary of Labor in the resolution of the labor dispute, to
which petition PHIMCO opposed. Pending resolution of the
said petition PHIMCO sent notice of termination to some 47
workers including several union officers.
Acting Secretary of Labor Jose Brillantes assumed
jurisdiction over the labor dispute and issued his Order;
All the striking workers, except those who have
been handed down termination papers on June 26, 1995,
are hereby directed to return to work within twenty-four
(24) hours from receipt of this Order and for the Company

to accept them back under the same terms and conditions

prevailing prior to the strike.
The parties are further ordered to cease and desist from
committing any act that will aggravate the situation.
Issue:
Whether the Secretary of Labor acted with grave
abuse of discretion in assuming jurisdiction over subject
labor dispute?
Held:
Yes. The Labor Code vests in the Secretary of Labor
the discretion to determine what industries are
indispensable to the national interest. Accordingly, upon
the determination by the Secretary of Labor that such
industry is indispensable to the national interest, he will
assume jurisdiction over the labor dispute in the said
industry.This power, however, is not without any limitation.
The private respondent did not even make any effort
to touch on the indispensability of the match factory to the
national interest. It must have been aware that a match
factory, though of value, can scarcely be considered as an
industry indispensable to the national interest as it cannot
be in the same category as generation and distribution of
energy, or those undertaken by banks, hospitals, and
export-oriented industries.
It is thus evident from the foregoing that the
Secretarys assumption of jurisdiction grounded on the
alleged
obtaining
circumstances
and
noton
a
determination that the industry involved in the labor dispute
is one indispensable to the national interest, the standard
set by the legislature, constitutes grave abuse of discretion
amounting to lack of or excess of jurisdiction.
Petition Granted.
83.
FEU-NRMF
vs.
FEU-NRMF
Employees
Association
Facts:
Petitioner FEU-NRMF and respondent union entered
into a Collective Bargaining Agreement (CBA) that will expire
on 30 April 1996.

In view of the forthcoming expiry, respondent union,

on 21 March 1996, sent a letter-proposal to petitioner FEUNRMF stating therein their economic and non-economic
proposals for the negotiation of the new CBA.
Petitioner FEU-NRMF sent a letter-reply rejecting
respondent unions demands and proposed to maintain the
same provisions of the old CBA. Petitioner FEU-NRMF
reasoned that due to financial constraints, it cannot afford to
accede to a number of their demands for educational and
death benefits, uniforms, longetivity pay, meal allowance
and special pay, but nevertheless gave an assurance that it
will seriously consider their proposal on salary increase.
In an effort to arrive at a compromise, subsequent
conciliation proceedings were conducted before the National
Conciliation and Mediation Board - National Capital Region
(NCMB-NCR) but because of the unyielding stance of both
parties, the negotiation failed.
Respondent union filed a Notice of Strike before
NCMB-NCR on the ground of bargaining deadlock. A strike
vote was conducted and the result thereof was submitted to
NCMB-NCR. After the expiration of the 30 day cooling off
period and the 7 day strike ban, respondent union,staged a
strike.
Petitioner FEU-NRMF filed a Petition for the
Assumption of Jurisdiction or for Certification of Labor
Dispute with the National Labor Relations Commission
(NLRC), underscoring the fact that it is a medical institution
engaged in the business of providing health care for its
patients.
Secretary of Labor, granted the petition and thus
issued an Order assuming jurisdiction over the labor dispute,
thereby prohibiting any strike or lockout whether actual or
impending, and enjoining the parties from committing any
acts which may exacerbate the situation.
NLRC process server, certified that he attempted to
serve a copy of the Assumption of Jurisdiction Order to the
union officers but since no one was around at the strike

area, he just posted copies of the said Order at several

conspicuous places within the premises of the hospital.
Claiming that they had no knowledge that the
Secretary of Labor already assumed jurisdiction over the
pending labor dispute as they were not able to receive a
copy of the Assumption of Jurisdiction Order, striking
employees continued holding a strike.
Subsequently, petitioner FEU-NRMF filed a case
before the NLRC, contending that respondent union staged
the strike in defiance of the Assumption of Jurisdiction
Order; hence, it was illegal.
Labor Arbiter rendered Decision declaring the strike
illegal and dismissing the union officers for conducting the
strike in defiance of the Assumption of Jurisdiction Order.
Upon Appeal, NLRC issued a Resolution affirming in toto the
Decision of the Labor Arbiter and upheld the illegality of the
strike and loss of employment status of the union officers.
When the case was elevated, CA rendered a Decision
granting the Petition and reversing the assailed Resolution.
The appellate court found that no personal service was
validly effected by the process server that could bind the
striking employees.
Issues:
Whether the service of the Assumption of Jurisdiction
Order was validly effected by the process server so as to
bind the respondent union and hold them liable for the acts
committed subsequent to the issuance of the said Order.
Held:
No. The process server resorted to posting the Order
when personal service was rendered impossible since the
striking employees were not present at the strike area. This
mode of service, however, is notsanctioned by either the

NLRC Revised Rules of Procedure or the Revised Rules of

Court.
An Order issued by the Secretary of Labor assuming
jurisdiction over the labor dispute is not a final judgment for
it does not dispose of the labor dispute with finality.
Consequently, the rule on service of summons and orders,
and not the proviso on service of decisions and final awards,
governs the service of the Assumption of Jurisdiction Order.
Under the NLRC Revised Rules of Procedure, service
of copies of orders should be made by the process server
either personally or through registered mail. However, due
to the urgent nature of the Assumption of Jurisdiction Order
and the public policy underlying the injunction carried by
the issuance of the said Order, service of copies of the same
should be made in the most expeditious and effective
manner, without any delay, ensuring its immediate receipt
by the intended parties as may be warranted under the
circumstances. Accordingly, in this case, personal service is
the proper mode of serving the Assumption of Jurisdiction
Order.
It is also provided under the same rules that in
special circumstances, service of summons may be effected
in accordance with the pertinent provisions of the Rules of
Court.
Parenthetically, the manner upon which personal
service may be made is prescribed by the following
provisions of the Revised Rules of Court:
Rule 13. Filing and Service of Pleadings, Judgments and
Other Papers.
Section 6. Personal service. Service of the papers
may be made by delivering personally a copy to the party or
his counsel, or by leaving it in his office with his clerk or
with a person having charge thereof. if no person is found in
his office, or his office is not known, or he has no office, then

by leaving a copy, between the hours of eight in the

morning and six in the evening, at the partys or counsels
residence, if known, with a person of sufficient age and
discretion then residing therein.
Clearly, personal service effectively ensures that the notice
desired under the constitutional requirement of due process
is accomplished. If, however, efforts to find the party
concerned personally would make prompt service
impossible, service may be completed by substituted
service, that is, by leaving a copy, between the hours of
eight in the morning and six in the evening, at the partys or
counsels residence, if known, with a person of sufficient age
and discretion then residing therein.
Employment is a property right of which one cannot be
deprived of without due process. Merely posting copies of
the Assumption of Jurisdiction Order does not satisfy the
rigid requirement for proper service outlined by the above
stated rules. Needless to say, the manner of service made
by the process server was invalid and irregular. Respondent
union could not therefore be adjudged to have defied the
said Order since it was not properly apprised
thereof. Accordingly, the strike conducted by the
respondent union was valid under the circumstances.
For a strike to be valid, the following requisites must
concur:
1. The thirty-day notice or the fifteen-day notice, in
case of unfair labor practices;
2. The two-thirds (2/3) required vote to strike done by
secret ballot; and
3. The submission of the strike vote to the Department
of Labor and Employment at least seven days prior to
the strike.
4. In addition, in case of strikes in hospitals, clinics and
medical institutions, it shall be the duty of the
striking employees to provide and maintain an
effective and skeletal workforce of medical and other
health personnel in order to insure the proper and

adequate protection of the life and health of its

patients.

without any notice of strike filed and a strike vote obtained

for the purpose.

These procedural requirements, along with the mandatory

cooling off and strike ban periods had been fully observed
by the respondent union.

Union filed a complaint for illegal dismissal. The

Labor Arbiter, in a decision upheld the validity of the
dismissal of said union officers. The decision was later on
affirmed by the respondent NLRC en banc.

As the strike conducted by the respondent union is valid and

legal, there is therefore no cogent reason to dismiss the
union officers.
Petition Denied.
84.
Union of Filipro Employees vs. NLRC
Facts:
Petitioner Union of the Filipro Employees, the sole
and exclusive bargaining agent of all rank-and-file
employees of Nestle Philippines, filed a Notice of Strike at
the Department of Labor raising the issues of CBA deadlock
and unfair labor practice.
(NCMB) invited the parties for a conference for the
purpose of settling the dispute. Private Respondent NESTLE
assailed the legal personality of the proponents of the said
notice of strike to represent the Nestle employees.
This notwithstanding, the NCMB proceeded to invite
the parties to attend the conciliation meetings and to which
private respondent failed to attend contending that it will
deal only with a negotiating panel duly constituted and
mandated in accordance with the UFE Constitution and Bylaws.
The Company terminated from employment all UFE
Union officers, headed by its president, Mr. Manuel
Sarmiento, and all the members of the negotiating panel for
instigating and knowingly participating in a strike staged

Respondent company contends that, "with the

dismissal of UFE officers including all the members of the
union negotiating panel as later on confirmed by the NLRC
en banc, said union negotiating panel thus ceased to exist
and its former members divested of any legal personality,
standing and capacity to act as such or represent the union
in any manner whatsoever."
Petitioner filed a motion asking the Secretary of
Labor to assume jurisdiction over the dispute of deadlock in
collective bargaining between the parties. Labor Secretary
Franklin Drilon certified to the NLRC the said dispute
between the UFE and Nestle, Philippines, Secretary
Drilonhereby certifies the sole issue of deadlock in CBA
negotiations and directed the NLRC to call all the parties
immediately and resolve the CBA deadlock within twenty
(20) days from submission of the case for resolution.
NLRC promulgated a resolution granting wage
increase and other benefits to Nestle's employees, ruling on
non-economic issues, as well as absolving the private
respondent of the Unfair Labor Practice charge.
Petitioner finds said resolution to be inadequate and
accordingly, does not agree therewith. Hence elevated the
case to the Supreme Court.
Issue:
Whether or not NLRC committed grave abuse of
discretion in resolving the issue certified by the Secretary of
Labor and formulating a CBA?

Held:
Surpreme Court ruled that NLRC committed no grave
abuse of discretion in resolving the issue certified by the
Secretary and formulating a CBA which covers the
bargaining units consisting of all regular rank-and-file
employees of the respondent company.
Public respondent's resolution is proper and in full
compliance with the order of the Secretary of Labor.
The assumption of jurisdiction by the Secretary of
Labor over labor disputes causing or likely to cause a strike
or lockout in an industry indispensable to the national
interest is in the nature of a police power measure. It cannot
be denied that the private respondent is engaged in an
undertaking affected with public interest being one of the
largest manufacturers of food products. The compelling
consideration of the Secretary's assumption of jurisdiction is
the fact that a prolonged strike or lockout is inimical to the
national economy and thus, the need to implement some
measures to suppress any act which will hinder the
company's essential productions is indispensable for the
promotion of the common good.
Under this situation, the Secretary's certification
order for compulsory arbitration which was intended for the
immediate formulation of an already delayed CBA was
proper. Corollarily, the NLRC was thereby charged with the
task of implementing the certification order for compulsory
arbitration. As the implementing body, its authority did not
include the power to amend the Secretary's order.
For the same reason, the prayer to declare the
respondent company guilty of acts of unfair labor practice
when it allegedly resorted to practices designed to delay the
collective bargaining negotiations cannot be subsumed in
this petition, it being beyond the scope of the certification
order.

The NLRC is not sitting as a judicial court but as an

administrative body charged with the duty to implement the
order of the Secretary. Its function only is to formulate the
terms and conditions of the CBA and cannot go beyond the
scope of the order.
In the light of the foregoing, the Court upholds the
pronouncement of the NLRC holding the CBA to be signed by
the parties effective upon the promulgation of the assailed
resolution.
Moreover, the NLRC is in the best position to
formulate a CBA which is equitable to all concerned.
Because of its expertise in settling labor disputes, it is
imbued with competence to appraise and evaluate the
evidence and positions presented by the parties. In the
absence of a clear showing of grave abuse of discretion, the
findings of the respondent NLRC on the terms of the CBA
should not be disturbed.
Petition Dismissed.
85.
Overseas Workers Welfare Administration
(OWWA) vs. Chavez
Facts:
OWWA is a government agency tasked primarily to
protect the interest and promote the welfare of overseas
Filipino workers (OFWs).
On 9 January 2004, as there was yet no formal
OWWA structure duly approved by the Department of
Budget and Management (DBM) and the Civil Service
Commission (CSC), the OWWA Board of Trustees passed
Resolution No. 001,bearing the title Approving the Structure
of the Overseas Workers Welfare Administration, and
depicting the organizational structure and staffing pattern of
the OWWA, as approved by Patricia A. Sto. Tomas (Sto.

Tomas), then Chair of the OWWA Board of Trustees and then

Secretary of the DOLE.

Whether or not Preliminary Injunction issued by the

RTC is proper?

DBM Secretary Emilia T. Boncodin, approved the

organizational structure and staffing pattern of the OWWA.

Held:

Respondents filed with the RTC, a Complaint for

Annulment of the Organizational Structure of the OWWA, as
approved by OWWA Board Resolutionwith Prayer for the
Issuance of a Writ of Preliminary Injunction.
Respondents
posited
that
the
approved
Organizational Structure and Staffing Pattern of the OWWA
increases the number of regular plantilla positions from 356
to 400. They further averred that the plantilla positions in
the Central Office will be reduced from 250 to 140, while the
regional
offices
will
have
an
increase
of
164
positions. According to the respondents, the resulting
decrease in the number of employees in the Central Office
will result in the constructive dismissal of at least 110
employees.
RTC issued an order granting respondents prayer for
a writ of preliminary injunction. In the grant thereof, the
RTC reasoned that any move to reorganize the structure of
the OWWA requires an amendatory law.
Petitioner, thru the Office of the Solicitor General
(OSG),filed with the Court of Appeals, a Petition
for Certiorari and Prohibition with Prayer for Issuance of a
Temporary Restraining Order and Writ of Preliminary
Injunction under Rule 65 of the Rules of Court, assailing the
RTC Order.
CA rendered decision dismissing the Petition and
affirmed the Trial Courts finding that respondents possess a
clear and legal right to the immediate issuance of the writ.
Issue:

A preliminary injunction is granted at any stage of an

action or proceeding prior to the judgment or final order.It
persists until it is dissolved or until the termination of the
action without the court issuing a final injunction.
A preliminary injunction is merely a provisional
remedy, an adjunct to the main case subject to the latters
outcome, the sole objective of which is to preserve
the status quo until the trial court hears fully the merits of
the case.
Thestatus quo should be that existing at the time of
the filing of the case.The status quo usually preserved by a
preliminary injunction is the last actual, peaceable and
uncontested status which preceded the actual controversy.
Supreme Court held that RTC, in granting the
assailed writ of preliminary injunction, committed grave
abuse of discretion amounting to lack of jurisdiction.
In the case at bar, the RTC did not maintain
the status quo when it issued the writ of preliminary
injunction. Rather, it effectively restored the situation prior
to the status quo, in effect, disposing the issue of the main
case without trial on the merits.
Courts should avoid issuing a writ of preliminary
injunction which would in effect dispose of the main case
without trial. RTC did not maintain the status quo but
restored the landscape before the implementation of
OWWAs reorganization. In thus issuing the writ of
preliminary injunction, the substantive issues of the main
case were resolved by the trial court. What was done by the
RTC was quite simply a disposition of the case without

trial. This is an error in law and an exercise of grave abuse

of discretion.
Assuming arguendo that respondents stand to be in
danger of being transferred due to the reorganization, under
the law, any employee who questions the validity of his
transfer should appeal to the CSC.Even then, administrative
remedies must be exhausted before resort to the regular
courts can be had.
Finally, as aptly pointed out by the OSG, the acts
sought to be prohibited had been accomplished. Injunction
will not lie where the acts sought to be enjoined have
already been accomplished or consummated.OWWAs
reorganization started to run upon the approval by the
Board of Trustees of its Resolution No. 001 entitled,
Approving the Structure of the Overseas Workers Welfare
Administration. Subsequently, a series of issuances which
approved the organizational structure and staffing pattern of
the agency was issued by the DBM, the OWWA
Administrator, and by the DOLE.Resolution No. 001 has
already been implemented. Case law has it that a writ of
preliminary injunction will not issue if the act sought to be
enjoined is afait accompli.
Petition Granted.
85.
Owwa v. Chavez, G.R. No. 169802, June 8, 2007
Facts
This is a petition filed by the OWWA assailing the Order of
the Court of Appeals affirming the decision of RTC Pasay
granting the Writ of Preliminary Injunction restraining OWWA
from implementing its new organizational structure.
As there was no formal DBM and CSC approved
organizational structure for OWWA prior to January 9, 2004,
the OWWA Board of Trustees passed a Resolution approving
an organizational and staffing structure for the Organization.

Subsequently the DBM approved such structure and in a

series
of
actions,
the
OWWA
implemented
the
reorganization pursuant to the approved structure.
On June 29, 2004 however, the herein respondents filed a
complaint before the RTC of Pasay to annul the said
organizational structure with a Prayer for issuance of the
Writ of Preliminary Injunction against OWWA.
The RTC decided in favor of herein respondents and issued
the Writ of Preliminary Injunction. Questioned before the
Court of Appeals, the said Decision was affirmed by the
Appellate Court.
Issue
Whether or not the Court of Appeals erred in affirming the
Decision of the RTC in granting the Writ of Preliminary
Injunction.
Ruling
The issuance of the Writ of Preliminary Injunction by the RTC
as affirmed by the Appellate Court must be struck down for
having been rendered in grave abuse of discretion.
The Court ruled that the purpose of the Writ of Preliminary
Injunction is to preserve the status quo until the trial court
hears fully the merits of the case. Status quo as defined by
the Court, should be that existing at the time of the filing of
the case. The status quo usually preserved by a preliminary
injunction is the last actual, peaceable and uncontested
status which preceded the actual controversy.
The Court further ruled that in this case, the RTC did not
maintain the status quo when it issued the writ of
preliminary injunction. Rather, it effectively restored the
situation prior to the status quo, in effect, disposing the
issue without trial on the merits.

86.
University of
Secretary of Labor
G.R. No. 151379
reinstatement)

Immaculate
January

14,

Conception
2005

vs.

(payroll

FACTS
University of Immaculate Conception filed a petition for
review of a decision of Court of Appeals affirming the
authority of the Secretary of Labor in ordering the
reinstatement of employees terminated by herein petitioner.
This case stemmed from a disagreement during the
collective bargaining negotiations pertaining to the inclusion
or exclusion of certain confidential employees. After the
Panel of Voluntary Arbitrators decided to exclude the
confidential employees, the Union filed a Motion for
Reconsideration and pending the resolution of said MR, the
Union subsequently issued a Notice of Strike. The University
on its part dismissed two union members during the 30 day
cooling off period. As the Union proceeded with the strike on
January 20, 1995, the Secretary of Labor, on January 23,
1995, assumed jurisdiction of the labor dispute and
accordingly issued a Return to Work Order.
On February 8, 1995, the panel of voluntary arbitrators
denied the MR filed by the Union.
On February 21, 1995, after the affected confidential
employees remained steadfast in their claim that they could
still retain their confidential positions while being members
or officers of the Union, the University terminated their
employment.
Due to the termination, the Union again went into strike and
assailed the termination as a violation of the earlier order of
the Secretary of Labor. The Secretary of Labor issued
another directive reiterating its previous order.

Although consistently denying the successive MRs filed by

the University, the Secretary of Labor modified its Order
placing
the
terminated
employees
under
payroll
reinstatement instead of actual reinstatement.
ISSUE
Whether or not the Order of the Secretary of Labor placing
the terminated employees under payroll reinstatement
instead of actual reinstatement is justified.
RULING
Although the Court stated that allowing payroll
reinstatement instead of actual reinstatement is usually not
allowed, as the term under the same terms and conditions
makes it clear that the norm is actual reinstatement, the
Court cited the superseding circumstances cited by the
Secretary of Labor as rendering the actual and physical
reinstatement impracticable and more likely to exacerbate
the situation. The Court pointed out to the final decision of
the panel of arbitrators as to the confidential nature of the
positions of the terminated employees, as the superseding
circumstates mentioned by the Secretary of Labor.
The Court ruled that the said action on the part of the
Secretary of Labor is justified and that there is no grave
abuse of discretion committed.

87.
Manila Diamond Hotel Employees Union vs. CA
140518, December 16, 2004 (payroll reinstatement)
FACTS
This case stemmed from a labor dispute between the Manila
Diamond Hotel and Manila Diamond Hotel Employees
Union. The dispute led to strike and dismissal of certain
employees. Due to the seemingly exacerbating situation,

the Secretary of Labor assumed jurisdiction of the dispute

invoking Article 263 (g) of the Labor Code and ordered the
striking workers to return to work and the Management to
accept them under the same terms and conditions
prevailing prior to the strike.
The Hotel management refused to accept the returning
workers and instead filed a Motion for Reconsideration of the
Secretarys Order. Acting on the MR, the Secretary of Labor
modified the earlier directive and instead of actual
reinstatement, payroll reinstatement was directed.
Acting on the Unions appeal, the Court of Appeals found for
the Secretary of Labor ruling that the challenged order is
merely an error of judgment and not a grave abuse of
discretion and that payroll reinstatement is not prohibited by
law, but may be called for under certain circumstances.
ISSUE
Whether or not the Secretary of Labor acted with grave
abuse of discretion in ordering payroll reinstatement in lieu
of actual reinstatement.
RULING
The Court ruled that there was abuse of discretion.
The Court pointed out the provision of Article 263 (g) of the
Labor Code is not meant to protect labor nor management
but serves as a means for the State to protect itself from an
emergency or crisis. The Court pointed out that the law uses
the precise phrase of under the same terms and
conditions, revealing that it contemplates only actual
reinstatement.
The Court further cleared that its earlier Ruling in the UST
case presented special circumstances rendering actual
reinstatement impracticable and this circumstance is absent
in this case.

88.
Portillo vs. Rudolf Lietz, G.R. No. 196539
October 10, 2012 (Jurisdiction of Labor Arbiter)
FACTS
Portillo resigned from her post and eventually got herself
employed by a competitor of Lietz.
Claiming unpaid salaries, commission, 13th month pay and
damages, Portillo filed a complaint before the NLRC. In its
defense, Lietz while acknowledging its obligations to Portillo
claims that the amount of its obligations be subjected to
legal compensation since Portillo breached her obligation
under the Goodwill Clause in her employment contract with
Lietz. Both the Labor Arbiter and the NLRC, upon appeal,
found for Portillo.
Lietz then filed a petition for certiorari before the Court of
Appeals which initially affirmed the NLRC Decision but on
Motion for Reconsideration, modified its decision ruling that
legal compensation is proper in this case.
ISSUE
Whether or not the Labor Arbiter has jurisdiction over the
claim by Lietz for damages
RULING
There is no causal connection between Portillos claim for
unpaid wages and Lietz claim for damages for the alleged
Goodwill Clause violation. While Portillos claim arose from
employee employer relationship, Lietz claim is a postemployment breach by Portillo.
This absence of connection results in the absence of
jurisdiction of the labor arbiter. The post employment breach
is within the jurisdiction of the regular courts.
89. University of St. Tomas Faculty vs. UST G.R. No.
203957, July 30, 2014 (Labor Arbiter Jurisdiction)

FACTS:
This case stemmed from the conflicting interpretations in
the Collective Bargaining Agreements (CBAs) between the
University of St. Tomas Faculty (USTFU) and the University of
Santo Tomas (UST).
Due to the failure of the UST to comply with certain
economic provisions in the CBAs, the USTF filed a complaint
before the Labor Arbiter. UST contested the same stating
that the Labor Arbiter has no jurisdiction since the claim
involves a dispute in the interpretation and implementation
of the CBAs. The Labor Arbiter rendered a decision in favor
of the USTFU though also ruling that there was no Unfair
Labor Practice committed by UST. Upon appeal the NLRC
found for the USTFU even modifying the Labor Arbiters
Ruling by increasing the award.
The Court of Appeals (CA) found merit in the position of UST
and ruled that the Labor Arbiter and the NLRC did not have
jurisdiction to hear and decide the case as the case involves
the clarification of the relevant items in the CBA which
properly belongs under the jurisdiction of the voluntary
arbitrator or panel of voluntary arbitrators.
ISSUE
Whether or not the Labor Arbiter has jurisdiction over the
case.
RULING
The Court affirmed the ruling of the CA which found the
Labor Arbiter and the NLRC acting without jurisdiction citing
Article 217 (c ) of the Labor Code which provides that the
Labor Arbiter shall refer to the grievance machinery and
voluntary arbitration as provided in the CBA those cases
that involve the interpretation of said agreements.
Moreover, the Court ruled that the original and exclusive
jurisdiction of the Labor Arbiter under Article 217 (c ) for
money claims is limited only to those arising from statutes
or contracts other than a Collective Bargaining Agreement.

90. Indophil Textile Mills vs. Adviento, G.R. No.

171212, August 4, 2014 (Labor Arbiter Jurisdiction)
Adviento was hired by Indophil as its Civil Engineer. In the
course of his employment with Indophil, Adviento developed
illnesses allegedly brought about by unsafe work
environment. Upon termination of his services, Adviento
filed a complaint before the NLRC for alleged illegal
dismissal and for payment of backwages, separation pay,
actual damages and attorneys fees.
Subsequently, Adviento filed a complaint before the RTC of
Aparri, Cagayan, alleging that he contracted such
occupational disease by reason of the gross negligence of
petitioner to provide him with a safe and workable
environment.Indophil sought to dismiss the complaint before
the RTC saying that the same falls under the original and
exclusive jurisdiction of the Labor Arbiter and a case is
already pending before the NLRC bearing the same cause
and parties. The RTC dismissed the motion of Indophil. CA
affirmed the RTC ruling.
ISSUE
Whether or not the case falls under the original and
exclusive jurisdiction of the Labor Arbiter
RULING
The Court ruled that the case does not fall under the
jurisdiction of the Labor Arbiter. The Court pointed out that
jurisdiction is determined from the allegations in the
complaint and the complaint of Adviento is clearly a case of
quasi-delict. Citing its previous decisions, the Court ruled
that money claims where there is no reasonable causal
connection with employee-employer relations falls within
the jurisdiction of the regular courts.
The Court stressed that although the acts complained of
appear to constitute matters involving employee-employer
relations since Adviento used to be the Civil Engineer of

Indophil, the formers claim for damages is specifically

grounded on petitioners gross negligence to provide a safe,
healthy and workable environment for its employees a
case of quasi-delict.
91.
7K Corp. vs. Albarico, G.R. No. 182295, June 26,
2013 (Labor Arbiter Jurisdiction)
FACTS
Albarico was employed by 7K Corp. as a salesman and was
promoted several times until he became acting field
supervisor. In April of 1993 however Albaricos services was
terminated allegedly due to poor performance. He
subsequently submitted his money claims against 7K Corp.
before the National Conciliation and Mediation Board
(NCMB).
While the NCMB case is pending, Albarico filed a complaint
against 7K Corp. before the NLRC for illegal dismissal with
money claims. The Labor Arbiter found for Albarico.
However, upon appeal, the NLRC vacated the Labor Arbiters
decision citing forum shopping on the part of Albarico since
the NCMB case is still pending. NCMB decided in favor of
Albarico. CA affirmed the decision. 7K Corp. brought the
case to the SC, arguing that under Article 217 of the Labor
Code, original and exclusive jurisdiction over termination
disputes, is lodged only with the Labor Arbiter.
ISSUE
Whether or not the original and exclusive jurisdiction over
termination disputes of the Labor Arbiters is absolute.
RULING
7K Corp. failed to take notice of the proviso contained in
Article 217 of the Labor Code which states that Except as
otherwise provided under this Code.. .
And the Code admits of exceptions as found in Article 262
which categorically states that the Voluntary Arbitrator or
panel of Voluntary Arbitrators, upon agreement of the

parties, shall also hear and decide all other labor disputes
including unfair labor practices and bargaining deadlocks.
The Court stressed that labor disputes referred to in the
same Article 262 can include all those disputes mentioned in
Article 217 over which the Labor Arbiter has original and
exclusive jurisdiction.
(92) Lepanto vs. Icao
G.R. No. 196047 January 15, 2014
Facts:
The private respondent (Icao) was dismissed from the
Lepanto Consolidated Mining Corporation for highgrading"
or the act of concealing, possessing or unauthorized
extraction of highgrade material/ore without proper
authority. Icao filed for illegal dismissal. The labor arbiter
rendered a decision holding petitioner and its CEO liable for
illegal dismissal and ordering them to pay respondent Icao
P345,879.45. The alleged highgrading was found to have
been fabricated; consequently, there was no just cause for
the dismissal of respondent. Petitioner and its CEO filed an
Appearance with Memorandum of Appeal before the NLRC.
Instead of posting the required appeal bond in the form of a
cash bond or a surety bond in an amount equivalent to the
monetary award of P345,879.45 adjudged in favor of Icao,
they filed a Consolidated Motion For Release Of Cash Bond
and to Apply Bond Subject For Release As Payment For
Appeal Bond (Consolidated Motion). They requested therein
that the NLRC release the cash bond of P401,610.84, which
they had posted in the separate case Dangiw Siggaao v.
LCMC, and apply that same cash bond to their present
appeal bond liability. They reasoned that since this Court
had already decided Dangiw Siggaao in their favor, and that
the ruling therein had become final and executory, the cash
bond posted therein could now be released. The NLRC
explained that their Consolidated Motion for the release of
the cash bond in another case (Dangiw Siggaao), for the
purpose of applying the same bond to the appealed case
before it, could not be considered as compliance with the
requirement
to
post
the
required
appeal
bond.

Consequently, it declared the labor arbiters Decision to be

final and executory.
The CA affirmed the NLRC.
Issue:
Whether or not petitioner complied with the appeal bond
requirement under the Labor Code and the NLRC Rules by
filing a Consolidated Motion to release the cash bond it
posted in another case, which had been decided with finality
in its favor, with a view to applying the same cash bond to
the present case.
Held:
Yes. The Court finds that petitioner substantially complied
with the appeal bond requirement. While it is true that the
procedure undertaken by petitioner is not provided under
the Labor Code or in the NLRC Rules, we answer the
question in the affirmative.
If in the above-cited cases, the Court found exceptional
circumstances that warranted an extraordinary exercise of
its power to exempt a party from the rules on appeal bond,
there is all the more reason in the present case to find that
petitioner substantially complied with the requirement. We
emphasize that in this case we are not even exempting
petitioner from the rule, as in fact we are enforcing
compliance with the posting of an appeal bond. We are
simply liberally applying the rules on what constitutes
compliance with the requirement, given the special
circumstances surrounding the case as explained above.
(93) Loon vs. Power-Master
G.R. No. 189404 December 11, 2013
Facts:
Respondents Power Master, Inc. and Tri-C General Services
employed and assigned the petitioners as janitors and
leadsmen in various Philippine Long Distance Telephone
Company (PLDT) offices in Metro Manila area. Subsequently,

the petitioners filed a complaint for money claims against

Power Master, Inc., Tri-C General Services and their officers,
the spouses Homer and Carina Alumisin (collectively, the
respondents). The petitioners alleged in their complaint that
they were not paid minimum wages, overtime, holiday,
premium, service incentive leave, and thirteenth month
pays. They further averred that the respondents made them
sign blank payroll sheets. On June 11, 2001, the petitioners
amended their complaint and included illegal dismissal as
their cause of action. They claimed that the respondents
relieved them from service in retaliation for the filing of their
original complaint. Notably, the respondents did not
participate in the proceedings before the Labor Arbiter
except on April 19, 2001 and May 21, 2001 when Mr. Romulo
Pacia, Jr. appeared on the respondents behalf. The
respondents counsel also appeared in a preliminary
mandatory conference on July 5, 2001.
LAs Ruling: The LA awarded the petitioners salary
differential, service incentive leaves and 13 th month pays. In
awarding these claims the LA stated that the burden in
proving the payment of these money claims rests with the
employer. However, they were not awarded backwages,
overtime, holiday and premium pays for failure to show that
they rendered overtime work and worked on holidays.
Moreover, it was not decided that they were illegally
dismissed for failure to show notice of termination of
employment.
Both parties appealed to the ruling of the LA.
NLRC: NLRC affirmed LAs ruling with regard the payment of
holiday pay and attorneys fees but vacated the awards of
salary differential, 13th month pays and service incentive
leaves. Moreover, NLRC allowed the respondents to present
pieces of evidence for the first time on appeal on the ground
that they have been deprived of due process. It also ruled
that petitioners were legally dismissed due to gross
misconduct.

CA affirmed.
Issue:
Whether or not respondents perfected their appeal before
the NLRC.
Held:
The respondents perfected their appeal with the NLRC
because the revocation of the bonding company's authority
has a prospective application.
Paragraph 2, Article 223 of the Labor Code provides that
"[i]n case of a judgment involving a monetary award, an
appeal by the employer may be perfected only upon the
posting of a cash or surety bond issued by a reputable
bonding company duly accredited by the Commission in the
amount equivalent to the monetary award in the judgment
appealed from."
Contrary to the respondents claim, the issue of the appeal
bonds validity may be raised for the first time on appeal
since its proper filing is a jurisdictional requirement. The
requirement that the appeal bond should be issued by an
accredited
bonding
company
is
mandatory
and
jurisdictional. The rationale of requiring an appeal bond is to
discourage the employers from using an appeal to delay or
evade the employees' just and lawful claims. It is intended
to assure the workers that they will receive the money
judgment in their favor upon the dismissal of the employers
appeal.
In the present case, the respondents filed a surety bond
issued by Security Pacific Assurance Corporation (Security
Pacific) on June 28, 2002. At that time, Security Pacific was
still an accredited bonding company. However, the NLRC
revoked its accreditation on February 16, 2003. Nonetheless,
this subsequent revocation should not prejudice the
respondents who relied on its then subsisting accreditation
in good faith.
(94) The Heritage Hotel Manila vs. NUWHRAIN
G.R. No. 178296 January 12, 2011
Facts:

The respondent, NUWHRAIN HHMSC (Union), is a labor

organization of the supervisory employees of Heritage Hotel
Manila. The Union filed with the DOLE a petition for
certification election which was granted by the Med-Arbiter.
On appeal, the DOLE Sec. affirmed the Med-Arbiters order
and remanded the case for the holding of the preelection
conference.
The preelection conference was not held as
scheduled and was only resumed three years later.

initially

Heritage Hotel (Company) discovered thereafter that the

Union had failed to submit to the Bureau of Labor Relations
(BLR) its annual financial report for several years and the list
of its members since it filed its registration papers in 1995.
Consequently, the Company filed a Petition for Cancellation
of Registration of the Union on the ground of non-submission
of the said documents. It further requested the suspension
of the certification election proceedings.
Barely a month thereafter, the Company reiterated its
request by filing a Motion to Dismiss or Suspend the
Certification Election Proceedings arguing that the dismissal
or suspension is warranted considering that the legitimacy
of the Union is being challenged in the petition for
cancellation of registration.
The certification election, nevertheless, pushed through and
the Union emerged as the winner.
The Company filed a Protest with Motion to Defer
Certification of Election Results and Winner
stating that the certification election was an exercise in
futility because, once the Unions registration is cancelled, it
would no longer be entitled to be certified as the SEBA of
the supervisory employees.
In its Answer, the Union averred that the petition was filed
primarily to delay the conduct of the certification elections

and prayed for the dismissal of the petition because it has

already complied with the reportorial requirements.
The Med-Arbiter dismissed the Companys protest and
certified the Union as the SEBA of all supervisory
employees. The appeal was later dismissed by the DOLE
Sec.
Meanwhile, the Reg. Director denied the Petition for
Cancellation of Registration. Though the Union indeed failed
to file the required documents for several years, the
freedom of association and the
employees right to self organization are more substantive
considerations. He considered the belated submission as
sufficient compliance and considered them as having been
submitted on time.
The Company appealed the decision to the BLR but the BLR
Director inhibited himself from the case because he had
been a former counsel of the Union. Thus, the DOLE Sec.
took cognizance of the appeal which was later dismissed.
The company filed a petition for certiorari with the CA
questioning the DOLE Sec.s taking cognizance of the
appeal.
The CA denied the petition holding that the DOLE Sec. may
legally assume jurisdiction over an appeal from the decision
of the Reg. Director in the even the BLR Director inhibits
himself from the case. There was also no GAD when the
DOLE Sec. affirmed the dismissal of the petition for
cancellation of registration.
Issue:
Whether or not the CA erred in affirming the dismissal of the
Cancellation
Petition
despite
the
mandatory
and
unequivocal provisions of the Labor Code and its IRR.
Held:

No. It is undisputed that appellee failed to submit its annual

financial reports and list of individual members in
accordance with Article 239 of the Labor Code. However, the
existence of this ground should not necessarily lead to the
cancellation of union registration. Article 239 recognizes the
regulatory authority of the State to exact compliance with
reporting requirements. Yet there is more at stake in this
case than merely monitoring union activities and requiring
periodic documentation thereof.
The
more
substantive
considerations
involve
the
constitutionally guaranteed freedom of association and right
of workers to self-organization. Also involved is the public
policy to promote free trade unionism and collective
bargaining as instruments of industrial peace and
democracy. An overly stringent interpretation of the statute
governing cancellation of union registration without regard
to surrounding circumstances cannot be allowed. Otherwise,
it would lead to an unconstitutional application of the
statute and emasculation of public policy objectives. Worse,
it can render nugatory the protection to labor and social
justice clauses that pervades the Constitution and the Labor
Code.
Moreover, submission of the required documents is the duty
of the officers of the union. It would be unreasonable for this
Office to order the cancellation of the union and penalize the
entire union membership on the basis of the negligence of
its officers.
(95) NFL vs. Laguesma
G.R. No. 123426 March 10, 1999
Facts:
On December 27, 1994, a petition for certification election
among the rank and file employees of Cebu Shipyard and
Engineering Work, Inc. was filed by the Alliance of
Nationalist and Genuine Labor Organization (ANGLO-KMU).
On January 9, 1995, forced-intervenor National Federation of
Labor (NFL) moved for the dismissal of the petition on the
grounds that the ANGLO-KMU failed to comply with the 25%

consent requirement and to submit the aforesaid

requirements necessary for its acquisition of legal
personality within the freedom period. The NFL also alleged
that the documents submitted by ANGLO-KMU were
procured through misrepresentation.
On March 13, 1995, the Med-Arbiter issued the assailed
Resolution dismissing the petition, after finding that the
submission of the required documents evidencing the due
creation of a local was made after the lapse of the freedom
period. Usec. Laguesma set aside the Med-Arbiters
resolution and entered in lieu thereof a new order finding
ANGLO-KMU as having complied with the requirements of
registration at the time of filing of the petition and
remanding the records of this case to the Regional Office of
origin.
The NFL thus filed this instant special civil action for
certiorari under Rule 65 of the Rules of Court.
Issue:
Whether or not the proper remedy to question the decision
of the Secretary of Labor and Employment is a petition for
certiorari under Rule 65.
Held:
Yes. The remedy of an aggrieved party from the decisions of
the NLRC and those of the Secretary of Labor and
Employment is to timely file a motion for reconsideration as
a precondition for any further or subsequent remedy and
then to seasonably file an action for certiorari under Rule 65.
All such petitions should be initially filed in the Court of
Appeals in strict observance of the doctrine on the hierarchy
of courts.
The propriety of Rule 65 as a remedy was highlighted in St.
Martin Funeral Homes vs. NLRC, where the legislative history
of the pertinent statutes on judicial review of cases decided
under the Labor Code was traced, leading to and supporting
the hypothesis that since appeals from the NLRC to the SC

were eliminated, legislative intendment was that the special

civil action of certiorari was and still is the proper vehicle for
judicial review of decision of the NLRC and consequently
all references in the amended Sec. 9 of BP 129 to supposed
appeals from the NLRC to the SC are interpreted and hereby
declared to mean and refer to petitions for certiorari under
Rule 65.
(96) Philtranco Service vs. Philtranco Workers Union
G.R. No. 180962 February 26, 2014
Facts:
On the ground that it was suffering business losses,
petitioner Philtranco Service Enterprises, Inc., a local land
transportation company engaged in the business of carrying
passengers and freight, retrenched 21 of its employees.
Consequently, the company union, herein private
respondent Philtranco Workers Union-Association of Genuine
Labor Organizations (PWU-AGLU), filed a Notice of Strike
with the Department of Labor and Employment (DOLE),
claiming that petitioner engaged in unfair labor practices.
Unable to settle their differences at the scheduled February
21, 2007 preliminary conference held before ConciliatorMediator Amorsolo Aglibut (Aglibut) of the National
Conciliation and Mediation Board (NCMB), the case was
thereafter referred to the Office of the Secretary of the DOLE
(Secretary of Labor).
After considering the parties respective position papers and
other submissions, Acting DOLE Secretary Danilo P. Cruz
issued a Decision dated June 13, 2007 which was received
by petitioner on June 14, 2007.
Aggrieved, petitioner filed a Motion for Reconsideration on
June 25, 2007, which was denied on August 15, 2007. The
order denying petitioners MR was received by it on August
17, 2007.
On August 27, 2007, petitioner filed a petition for certiorari
(Rule 65) before the CA which was dismissed by the latter

on the ground that the petitioner availed of the improper

remedy.

permanent employees, but were affected by petitioners

retrenchment and voluntary retirement programs.

Issue:
Whether or not decisions of DOLE Secretary may be subject
to certiorari under Rule 65.

On March 15, 2004, Tagyamon, Luna, Badayos, Dela Cruz,

and Comandao received a uniformly worded Memorandum
of dismissal.

Held:
Yes. The authority of the Secretary of Labor to assume
jurisdiction over a labor dispute causing or likely to cause a
strike or lockout in an industry indispensable to national
interest includes and extends to all questions and
controversies arising therefrom. The power is plenary and
discretionary in nature to enable him to effectively and
efficiently dispose of the primary dispute. This wide latitude
of discretion given to the Secretary of Labor may not be the
subject of appeal.

As to Marcos, Ilao, and Nemis, they claimed that they were

dismissed effective March 31, 2004, together with fifteen
(15) other employees on the ground of lack of market/slump
in demand.11 PCMC, however, claimed that they availed of
the companys voluntary retirement program and, in fact,
voluntarily executed their respective Deeds of Release,
Waiver, and Quitclaim.

In fine, we find that it is procedurally feasible as well as

practicable that petitions for certiorari under Rule 65 against
the decisions of the Secretary of Labor rendered under the
Labor Code and its implementing and related rules be filed
initially in the Court of Appeals. Paramount consideration is
strict observance of the doctrine on the hierarchy of the
courts, emphasized in St. Martin Funeral Homes v. NLRC, on
"the judicial policy that this Court will not entertain direct
resort to it unless the redress desired cannot be obtained in
the appropriate courts or where exceptional and compelling
circumstances justify availment of a remedy within and
calling for the exercise of our primary jurisdiction.
(97) Philippine Carpet Manufacturing vs. Tagyamon et
al.
G.R. No. 191475 December 11, 2013
Facts:
Petitioner Philippine Carpet Manufacturing Corporation
(PCMC) is a corporation registered in the Philippines
engaged in the business of manufacturing wool and yarn
carpets and rugs. Respondents were its regular and

Claiming that they were aggrieved by PCMCs decision to

terminate their employment, respondents filed separate
complaints for illegal dismissal against PCMC.
PCMC, for its part, defended its decision to terminate the
services of respondents being a necessary management
prerogative. It pointed out that as an employer, it had no
obligation to keep in its employ more workers than are
necessary for the operation of his business. Thus, there was
an authorized cause for dismissal. Considering that
respondents accepted their separation pay and voluntarily
executed deeds of release, waiver and quitclaim, PCMC
invoked the principle of estoppel on the part of respondents
to question their separation from the service. Finally, as to
Marcos, Ilao and Nemis, PCMC emphasized that they were
not dismissed from employment, but in fact they voluntarily
retired from employment to take advantage of the
companys program.
Issue:
Whether or not respondents were illegally dismissed.
Held:
Yes. In ascertaining the bases of the termination of
employees, it took into consideration petitioners claim of

business losses; the purchase of machinery and equipment

after the termination, the declaration of cash dividends to
stockholders, the hiring of 100 new employees after the
retrenchment, and the authorization of full blast overtime
work for six hours daily. These, said the Court, are
inconsistent with petitioners claim that there was a slump
in the demand for its products which compelled them to
implement the termination programs. In arriving at its
conclusions, the Court took note of petitioners net sales,
gross and net profits, as well as net income. The Court, thus,
reached the conclusion that the retrenchment effected by
PCMC is invalid due to a substantive defect.
Respondents failed to adduce clear and convincing evidence
to prove the confluence of the essential requisites for a valid
retrenchment of its employees.
As the ground for termination of employment was illegal, the
quitclaims are deemed illegal as the employees consent
had been vitiated by mistake or fraud. The law looks with
disfavor upon quitclaims and releases by employees
pressured into signing by unscrupulous employers minded
to evade legal responsibilities. The circumstances show that
petitioners misrepresentation led its employees, specifically
respondents herein, to believe that the company was
suffering losses which necessitated the implementation of
the voluntary retirement and retrenchment programs, and
eventually the execution of the deeds of release, waiver and
quitclaim.
(98) Borra vs. CA, HAWAIIAN PHILIPPINE COMPANY
(HPC)
G.R. No. 167484 September 9, 2013
Facts:
On September 12, 1997, herein petitioners filed with the
NLRC Regional Arbitration Branch No. VI in Bacolod City two
separate complaints which were docketed as RAB Case No.
06-09-10698-97 and RAB Case No. 06-09-10699-97. RAB
Case No.06-09-10698-97 was filed against herein private

respondent alone, while RAB Case No. 06-09-10699-97

impleaded herein private respondent and a certain Fela
Contractor as respondents. In RAB Case No. 06-09-1069897, herein petitioners asked that they be recognized and
confirmed as regular employees of herein private
respondent and further prayed that they be awarded various
benefits received by regular employees for three (3) years
prior to the filing of the complaint, while in RAB Case No. 0609-10699-97,herein petitioners sought for payment of
unpaid wages, holiday pay, allowances, 13th month pay,
service incentive leave pay, moral and exemplary damages
also during the three (3) years preceding the filing of the
complaint.
On January 9, 1998, private respondent (HPC) filed a Motion
to Dismiss RAB Case No. 06-09-0698-97 on the ground of res
judicata. The Labor Arbiter granted the same.
Petitioners appealed to the NLRC which set aside the Order
of the Labor Arbiter, reinstated the complaint in RAB Case
No. 06-09-10698-97 and remanded the same for further
proceedings.
HPC appealed to the CA which affirmed the decision of the
NLRC.
The SC likewise affirmed the decision of the CA and
remanded the case to the Labor Arbiter to determine which
among Fela contractor and HPC is the real employer of the
petitioners.
In the meantime, the Labor Arbiter rendered a Decision in
RAB Case No. 06-09-10699-97 holding that there is no
employer-employee relations between private respondent
and petitioners. And no appeal was taken therefrom. Thus,
the same became final and executory.
As a consequence of the finality of the Decision in RAB Case
No. 06-09-10699-97, herein private respondent again filed a
Motion to Dismiss RAB Case No. 06-09-10698-97 on the
ground, among others, of res judicata. Private respondent
HPC contended that the final and executory Decision of the
Labor Arbiter in RAB Case No. 06-09-10699-97, which found
no
employer-employee
relations
between
private
respondent and petitioners, serves as a bar to the further
litigation of RAB Case No. 06-09-10698-97.

Said Motion To Dismiss was denied. As a result, private

respondent HPC filed a petition for certiorari (Rule 65) before
the CA which granted the same.
Hence, this petition.
Issue:
Whether or not HPC availed of the proper remedy when its
Motion To Dismiss was dismissed by the Labor Arbiter in RAB
Case No. 06-09-10698-97.
Held:
Yes. It is settled that jurisdiction over the subject matter is
conferred by law and it is not within the courts, let alone the
parties, to themselves determine or conveniently set aside.
In this regard, it should be reiterated that what has been
filed by private respondent with the CA is a special civil
action for certiorari assailing the Labor Arbiter's Order which
denied its motion to dismiss.
Section 3, Rule V of the NLRC Rules of Procedure, which was
then prevailing at the time of the filing of private
respondent's petition for certiorari with the CA, clearly
provides:
SECTION 3.
MOTION TO DISMISS. - On or before the date set for the
conference, the respondent may file a motion to dismiss.
Any motion to dismiss on the ground of lack of jurisdiction,
improper venue, or that the cause of action is barred by

prior judgment, prescription or forum shopping, shall be

immediately resolved by the Labor Arbiter by a written
order. An order denying the motion to dismiss or suspending
its resolution until the final determination of the case is not
appealable.
The Labor Arbiter committed a grave abuse of discretion
when it did not dismiss RAB Case No. 06-09-10698-97 upon
motion of HPC on the ground of res judicata.
The Court explained:
Conclusiveness of judgment finds application when a fact or
question has been squarely put in issue, judicially passed
upon, and adjudged in a former suit by a court of competent
jurisdiction. The fact or question settled by final judgment or
order binds the parties to that action (and persons in privity
with them or their successors-in-interest), and continues to
bind them while the judgment or order remains standing
and unreversed by proper authority on a timely motion or
petition; the conclusively-settled fact or question cannot
again be litigated in any future or other action between the
same parties or their privies and successors-in-interest, in
the same or in any other court of concurrent jurisdiction,
either for the same or for a different cause of action. Thus,
only the identities of parties and issues are required for the
operation of the principle of conclusiveness of judgment.