Labor Finals Digests 2014

 

UNIVERSITY OF SAN CARLOS COLLEGE OF LAW

COMPENDIUM OF LABOR STANDARDS LAW FINAL CASE DIGESTS 2014

 _________________________________  _______________________________ __ IN PARTIAL FULFILLMENT FOR THE REQUIREMENTS IN LLB 242N (LABOR STANDARDS LAW)  _________________________________  _______________________________ __

SUBMITTED BY: MIKKO GABRIEL L. VALENDEZ JD –  2  2 (EH306)

SUBMITTED TO: ATTY. JEFFERSON M. MARQUEZ

OCTOBER 16, 2014

 

LABOR STANDARDS LAW

LIST OF LABOR STANDARD CASES

JURISDICTION OF THE LABOR ARBITER 

1.  Tolosa vs. NLRC, G.R. No. 149578, April 10, 2003

20.  Ace Navigation Co. Inc. et al., vs. Fernandez, G.R. No. 197309, October 10,

2.  Austria vs. NLRC, 312 SCRA 413 3.  Eviota vs. Court of Appeals, 407 SCRA 394 4.  Dynamic Signmaker Outdoor Advertising Services vs. Potongan, G.R. No. 156589, June 27, 2005 5.  Metromedia Times Corp., vs. Pastorin, G.R.  No. 154295, July 29, 2005 6.  Yusen Air & Sea Service Phils vs. Villamor, G.R. No. 154942, August 16, 2005 7.  Duty Free Phils., vs. Mojica, G.R. No. 166365, September 30, 2005 8.  Easycall Communication Phils., vs. King, G.R. No. 145901, December 15, 2005

2012 21.  Cosare vs. Broadcom Asia, Inc. GR No. 201298, February 5, 2014, citing 2010 Matling Industrial and Commercial Corp et al., vs. Coros, GR No. 157802 and 2011 Real vs. Sangu Phils., Inc., et al., G.R. No. 168757

 

9. San MiguelUnion-PTGWO, Foods Inc., vs. San Miguel Employees G.R. No. Corp 168569, October 5, 2007 10.  Leyte IV Electric Cooperative Inc vs. LEYECO IV Employees Union-ALU, G.R.  No. 1577745, October October 19, 2007 11.  Atty Garcia vs. Eastern Telecommunications Phils., et al., GR No. 173115 & 173163-64, April 16, 2009 12.  Halaguena et al., vs. Phil Airlines GR No. 172013, Oct 2, 2009 13.  Okol vs. Slimmer‘s World International, Internat ional, et al., G.R. No. 160146, December 11, 2009 14.  Hugo et al., vs. Light Rail Transit Authority, G.R. No. 181866, March 18, 2010 15.  Matling Industrial and Commercial Corp et al., vs. Coros, GR No. 157802, Oct. 13, 2010 16.  Manila Electric Co. et al., vs. Lim, GR No. 184769, Oct. 5, 2010 17.  Hongkong and Shanghai Banking Corp., vs. Sps. Broqueza, GR No. 178610, Nov. 17, 17 , 2010 18.  Real vs. Sangu Phils., Inc., et al., G.R. No. 168757, January 19, 2011 19.  Portillo vs. Rudolf Lietz, Inc. et al., G.R.  No. 196539, October October 10, 2012

2011 NLRC RULES OF PROCEDURE

22.  T/SGP Larkins vs. NLRC, G.R. No. 92432, February 23, 1995 23.  UERM Memorial Medical Center vs.  NLRC, G.R. No. No. 110419, March March 3, 1997 24.  Phil Tranco Services vs. NLRC, G.R. No. 124100, April 1, 1998 25.  St. Martin Funeral Homes vs. NLRC, G.R.  No. 130866, September September 16, 1998 26.  Ludo & Luym Corp., vs. Saornido, G.R. No. 140960, January 20, 2003 27.  Hansin Engineering & Construction vs. CA, G.R. No. 165910, April 10, 2006 28.  Phil. Journalist Inc. vs. NLRC, G.R. No. 166421, Sept. 5, 2006 29.  Balagtas Multi-purpose Coop. Vs. CA, G.R.  No. 159268, Oct. Oct. 27, 2006 30.  St. Martin Funeral Homes vs. NLRC, G.R.  No. 142351, Nov. Nov. 22, 2006 31.  DOLE Phils. Vs. Esteva, G.R. No. 161115,  Nov. 30, 2006 32.  Intercontinen Intercontinental tal Broadcasting Corp., vs. Panganiban, G.R. No. 151407, February 6, 2007 33.  Far East Agricutural Supply vs. Lebatigue, G.R. No. 162813, February 12, 2007 34.  Letran Calamba Faculty & Employees Association vs. NLRC, G.R. No. 156225, January 29, 2008 35.  Metro Transit Organization vs. Piglas  NFWU-KMU et al., G.R. No. 175460, A April pril 14, 2008

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LABOR STANDARDS LAW

36.  J.K. Mercado & Sons Agricultural Enterprises, Inc., vs Sto. Tomas, T omas, G.R.No. 158084, August 29, 2008 37.  J. Phil. Marine Inc., vs. NLRC, G.R. No. 1753661, August 11, 2008; but see Ilagan vs. Court of Appeals, G.R. No. 162089, July 9, 2008  

38. Sy vs. ALC G.R. No. 168339, October 10, Industries, 2008 39.  PCI Travel Corp., vs. NLRC, G.R. No. 154379, October 31, 2008 40.  Lopez vs. Q. C. Sports Club, C lub, G.R. No. 164032, January 19, 2009 41.  Lockheed Detective & Watchman Agency, G.R. No. 185918, April 18, 2012 42.  Portillo vs. Rudolf Lietz, Inc. et al., G.R.  No. 196539, October October 10, 2012 43.  Building Care Corp. vs. Macaraeg, G.R. No. 198357, December 10, 2012 OTHER IMPORTANT LABOR PROVISIONS A.CONTRACTING ARRANGEMENT

44.  PBCom vs. NLRC, 146 SCRA 347 [1986] 45.  Neri vs. NLRC, NLRC, 224 SCRA 717 [1993] 46.  Filipinas Synthetic Fiber Corp., vs. NLRC, 257 SCRA 336 [1996] 47.  Maraquinot vs. NLRC, 284 SCRA 539 [1998] 48.  Urbanes Jr. vs. Sec. Of Labor, G.R. No. 122791, Feb. 19, 2003 49.  San Miguel vs. Maerc Integrated Services, G.R. No. 144672, July 10, 2003 50.  Mariveles Shipyard vs. CA, G.R. No. 144134, Nov. 11, 2003 51.  New Golden City Builders vs. vs. CA, G.R. No. No. 154715, Dec. 11, 2003 52.  National Food Authority Authority vs. Maceda Maceda SecurIty Agency, G.R. No. 163448, March 8, 2005 53.  Abella vs. PLDT, G.R. No. 159469, June 8, 2005 54.  San Miguel vs. Aballa, G.R. No. 149011, June 28, 2005 55.  Manila Electric Co., vs. Benamira, G.R. No. 145271, July 14, 2005

56.  Granspan Development Corp., vs. Bernardo, G.R. No. 141464, Sept. 21, 2005 57.  Acevedo vs. Advanstar Co., G.R. No. 157656, Nov. 11, 2005 58.  Big AA Manufacturer vs. Antonio, G.R. No. 1608504, March 3, 2006 59.  DOLE Phils. Vs. Esteva, G.R. No. 161115, 30, 2006 60.  Nov. San Miguel Vs. NLRC, G.R. No. 147566, Dec. 6, 2006 citing Maerc Integrated Services case 61.  Eparwa Security & Janitorial Services vs. Liceo De Cagayan Univ. G.R. No. 150402,  Nov. 28, 2006, citing citing Eagle Security case 62.  Lapanday Agri Development Corp., vs. Court of Appeals, 324 SCRA 39 63.  Escario vs. NLRC, 333 SCRA 257 [2000] 64.  Aboitiz Haulers vs. Dimapatoi, G.R. No. 148619, Sept. 19, 2006 65.  GSIS vs. NLRC, G.R. No. 157647, October 15, 2007, citing Rosewood Processing vs.  NLRC, 290 SCRA 408 66.  Republic of the Phils/SSC/SSS vs. Asiapro Cooperative, G.R. No. 172101, November 23, 2007 67.  Almeda et al., vs. Asahi Glass, G.R. No. 177785, Sept 3, 2008 68.  Sasan, Sr et al., vs. NLRC and EPCIB, G.R.  No. 176240, October October 17, 2008 69.  Purefoods Corp., vs. NLRC et al., G.R. No. 172241, November 20, 2008 70.  Maranaw Hotels and Resort vs. Court of Appeals, et al., G.R. No. 149660, Jan. 20, 2009 71.  CCBPI vs. Agito et al., G.R. No. 179546, Feb. 13, 2009 72.  South Davao Development Company et al., vs. Gamo et al., GR No. 171814, 171 814, May 8, 2009 73.  Traveno et al., vs. Bobongon Banana Growers Multi-purpose Cooperative et al., GR No. 164205, Sept. 3, 2009 74.  Locsin et al., vs. PLDT, GR No. 185251, Oct 2, 2009 75.  Aliviado et al vs. Procter & Gamble Phils GR No. 160506, March 9, 2010 76.  San Miguel Corp. vs. Semillano et al., GR  No. 164257, July July 5, 201

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77.  Manila Water Co. vs. Dalumpines, GR No. 175501, Oct. 4, 2010 78.  Teng vs. Pahagac, GR No. 169704,  November 17, 2010 2010 79.  GSIS vs. NLRC et al., GR No. 180045,  Nov. 17, 2010 80.  Sy et al., vs. Fairland Knitcraft Co Inc. G.R.

96.  Brahm Industries vs. NLRC, 280 SCRA 824 [1997] 97.  Heirs of Aniban vs. NLRC, 282 SCRA 377 [1997] 98.  Sapio vs. Undaloc Construction et al., G.R.  No. 155034, May 22, 2008 99.  Atty. Ortiz vs. San Miguel Corp., G.R. No.

189658, December DecInternational ember 12, 2011 81.  No. Polyfoam-RGC Corp., vs. Concepcion, G.R. No. 172349, June 13, 2012 82.  Superior Packaging Corp., vs. Balagsay et al., G.R. No. 178909, October 10, 2012 83.  Digital Telecommunications Telecommunications Phils Inc. vs. Digitel Employees Union et al., G.R. No. 184903-04, October 10, 2012 84.  Norkis Trading Corp., vs. Buenavista, Buenavista, et al., G.R. No. 182018, October 10, 2012 85.  Goya Inc. vs. Goya Inc. Employees UnionFFW G.R. No. 170054, Jan. 21, 2013 86.  Vigilla et al., vs. Phil. College of Criminology Inc., G.R. No. 200094, June 10, 2013 87.  BPI Employees Union-Davao city-FUBU vs. Bank of the Phil Islands et al., G.R. No. 174912, July 24, 2013

151983-84, 31,et2008 100. Masmud M asmud vs.July NLRC al., G.R. No. 183385, Feb. 13, 2009 101. Kaisahan Kaisahan at kapatiran ng mga Manggagawa at Kawani sa MWC-East Zone Union vs. Manila Water Company, G.R. No. 174179,  November 16, 2011 102. Malvar Malvar vs. Kraft Food Phils Inc. et al., G.R.  No. 183952, Sept. Sept. 9, 2013

B.WORKER'S PREFERENCE

88.  DBP vs. NLRC, 242 SCRA 59 [1995] 89.  Batongbuhay Gold Mines vs. De la Serna, 312 SCRA 45 90.  Barayoga vs. Asset Privatization Trust, G.R.  No. 160073, October October 24, 2005  

91. Phil. Airlines Feb. 6, 2007 vs. Zamora, G.R. No. 166996, 92.  Phil. Airlines vs. Phil. Airlines Employees Association, 525 SCRA 29 [2007], citing Rubberworld vs. NLRC, 305 SCRA 721 [1999] 93.  Garcia vs. Phil Air Lines, G.R. No. 164856, January 20, 2009 C.ATTORNEY'S FEES & APPEARANCE OF LAWYERS

94.  Bank of the Philippines Island vs. NLRC, 171 SCRA 556 95.  Traders Royal Bank Employees Union vs.  NLRC, 269 SCRA 733 [1997] UNIVERSITY OF SAN CARLOS SCHOOL OF LAW AND GOVERNANCE

D.SPECIAL TYPES OF WORKERS

103. Bernardo Bernardo vs. NLRC, 310 SCRA 186 [1999] E. EMPLOYMENT OF WOMEN 104. PT&T PT&T vs. NLRC, 272 SCRA 596 [1997]

105. Del Del Monte Phils vs. Velasco, G.R. No. 153477, March 6, 2007 106. Co Co vs. Vargas, G.R. No. 195167, November 16, 2011 F. EMPLOYMENT OF CHILDREN G. EMPLOYMENT OF HOUSEHELPER

107. Ultra Ultra Villa Food Haus vs. Geniston, 309 SCRA 17 [1999] 108. Remington Remington Industrial Sales Corp., vs. Castaneda, G.R. No. 169295-96, Nov. 20, 2006 citing Apex Mining Co vs. Vargas, G.R. No. 195167, November 16, 2011 H. EMPLOYMENT OF HOMEWORKERS I. EMPLOYMENT OF NON-RESIDENT ALIENS J. EMPLOYMENT OF STUDENTS & WORKING SCHOLAR K.EMPLOYMENT OF ACADEMIC/NON-

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LABOR STANDARDS LAW

ACADEMIC PERSONNEL IN PRIVATE EDUCATIONAL INSTITUTION

119. Sim Sim vs. NLRC et al., G.R. No. 157376, October 2, 2007

109. University University of the east et al., vs. Pepanio, G.r.  No. 193897, Jan. 23, 2013

120. Bahia Bahia Shipping Services vs. Chua, G.R. No. 162195, April 8, 2008

110. Colegio Colegio Del Santisimo Rosario et al., vs.

121. Masangkay Masangkay vs. Trans-Global Maritime

Rojo, G.R. No. 170388, Sept. 4, 2013 citing Mercado et al., vs. AMA Computer CollegeParanaque City, GR No. 183572, April 13, 2010 111. Herrera-Manaois Herrera-Manaois vs. St. Scholasticas College, GR No. 188914, December 11, 2013 MEDICAL, DENTAL AND OCCUPATIONAL SAFETY

Agency Inc., et al., G.R. No. 172800, October 17, 2008 122. Magsaysay Magsaysay Maritime Corp., et al., vs. Velasquez, et al., G.R. No. 179802, Nov 14, 2008 123. Serrano Serrano vs. Gallant Maritime Services et al., G.R. No. 167614, March 24, 2009 –  2009  –  En  En Banc

112. Tolosa Tolosa vs. NLRC, G.R. No. 149578, April

124. Becmen Becmen Service Exporter and Promotion Inc., vs. Spouses Cuaresma, GR Nos.

10, 2003 113. U-Bix U-Bix Corp., vs. Bandiola, 525 SCRA 566 [2007]

182978-79 & 184298-99, April 7, 2009 125. People People vs. Domingo, GR No. 181475, April 7, 2009

114. Ocean Ocean Builders Construction vs. Sps. Cubacub, GR No. 150898, April 13, 2011

126. ATCI ATCI Overseas Corp. et al., vs. Echin, GR  No. 178551, Oct. Oct. 11, 2010

MIGRANT WORKER'S ACT & OVERSEAS FILIPINO ACT OF 1995 & RECRUITMENT AND PLACEMENT

115. ISS ISS Indochina Corp., vs. Ferrer, G.R. No. 156381, Oct. 14, 2005 116. People People vs. Capt. Gasacao, G.R. No. 168449,  Nov. 11, 2005

127. Yap Yap vs. Thenamaris Ship Management et al., G.R. No. 179532, May 30, 2011 128. Skippers Skippers United Pacific vs. Doza et al., G.R.  No. 175558, February February 8, 2012 129. International International Management Services vs. Logarta, G.R. No. 163657, April 18, 2012

117. Acuna Acuna vs. CA, G.R. No. 159832, May 5, 2006

130. Pert/Cpm Pert/Cpm Manpower Exponent Co., Inc. vs. Vinuya et al., G.R. No. 197528, September 8, 2012

118. Asian Asian International Manpower Services vs. CA, G.R. No. 169652, October 9, 2006

131. Hon. Hon. Sto. Tomas, et al., vs. Salac et al., G.R.  No. 152642 & 152710, November November 13, 2012

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LABOR STANDARDS LAW

1.  Tolosa vs. NLRC G.R. No. 149578, April 10, 2003

alleged that the reasonable causal rule should be applied in her favor.

Facts: Petitioner is the wife of Capt. Tolosa To losa who was hired to be the master of M/V Lady Dona with  private respondents respondents Garate and Asis Asis as Chief Mate Mate and Second Mate of the vessel respectively. Capt. Tolosa was hired by co-private respondent QwanaKaiun through the manning agent Asia Bulk Transport Phils., Inc. The voyage was from Yokohama, Japan to Long Beach, California. Capt. Tolosa was given a compensation of US$1,700 monthly plus US$400 overtime allowance monthly. Upon embarkation, Capt. Tolosa‘s health was still in good shape but after being drenched in rainwater after embarkation, he suffered Loose Bowel B owel Movement and fever which led eventually to his death after several days.

Issue: Whether or not the Labor Arbiter has  jurisdiction over over the subject matter? matter?

Petitioner filed a Complaint/Position Paper with the Philippine Overseas Employment Agency against  private respondents respondents herein but because because of the amendatory law expanding the jurisdiction of the  National Labor Relations Commission Commission (NLRC), the case was raffled to a Labor Arbiter. She sought to recover (a) loss of earning capacity as ‗actual damages‘ and (b) blacklisting imputing gross negligence to private respondents Garate and Asis. She anchored her claim on Article 161 of the Labor Code regarding Assistance of Employer. E mployer. Private respondents, on the other hand, asserted that the Labor Arbiter has no jurisdiction as the complaint is based on torts which the regular courts have  jurisdiction. The Labor Arbiter ruled in favor of petitioner granting her the relief sought. On appeal, the NLRC reversed the Labor Arbiter‘s Arbiter‘s Decision. It ruled that the Labor Arbiter had no jurisdiction over the subject matter. The Court of Appeals affirmed the NLRC. It ruled that the case did not arise from a quasi-delict or tort and not from an employee-employer relationship nor does it have any reasonable causal connection for damages to be awarded incident to an employeee mployeeemployer relationship. Hence, this instant petition.

Ruling: No, the Labor Arbiter does not have  jurisdiction over over the subject matter. matter. The Court ruled that labor arbiters and the NLRC have no power to grant reliefs from claims that do not arise from employer-employee employer-empl oyee relationships. They have no  jurisdiction over over torts that do not have a reasonable reasonable causal connection to any of the claims provided for in the Labor Code, other labor statutes, or collective  bargaining agreements. agreements. It has been emphasized that the allegation of the complaint determines the nature of the action and consequently, the jurisdiction of the courts. The Court was convinced that the allegations were in the nature of an action based on quasi-delict or tort resulting fromjurisdiction gross negligence. though Labor Arbiters have to grantEven damages under the Civil Code, these reliefs must still be based on an action that has a reasonable causal connection with the Labor Code, other labor statutes, or collective  bargaining agreements. agreements. It is the the character of the  principal relief relief that appears essential in this this connection. In the case at hand, loss of earning capacity and  blacklisting cannot cannot be equated to wages, wages, overtime compensation or separation pays. They arise from causes within the realm of civil law. Petitioner cannot also anchor her claim on Article 161 as this does not grant or specify a claim or relief. 2.  Austria vs. NLRC G.R. No. 124382 August 16, 1999

Facts: Private Respondent Central Philippine Union Mission Corporation of the Seventh-Day Adventists (SDA) is a religious corporation duly organized and existing under Philippine law. Austria was a Pastor of the SDA until 1991, when his services were terminated.

Petitioner argued that her cause of action is not based

Austria worked with the SDA for 28 years from 1963

on negligence but on Art. 161 of the Labor Code. She

to 1991. He began hisselling work with the SDA a literature evangelist, literature of theasSDA

 

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LABOR STANDARDS LAW

over the island of Negros. From then on, he worked his way up the ladder and got promoted several times. He was elevated to the position of Pastor and the finally as a District Pastor in Negros with 12 churches under his jurisdiction. On various occasions, Austria received several communications the treasurer of the Negros Mission asking him to admit and responsibility for the church tithes accountability and offerings. After several meetings were held and an investigation was made on the matter, Austria received a letter of dismissal  citing misappropriation misappropriati on of denominational funds, willful  breach of trust, trust, serious misconduct, misconduct, gross and habitual neglect of duties, and commission of an offense against the person of employer's duly authorized representative, representative, as grounds for the termination of his services. Reacting against the adverse decision of the SDA, Austria filed a before the Labor Arbiter for illegal dismissal against the SDA and its officers and prayed for reinstatement with backwages and benefits, moral and exemplary damages and other labor law benefits. The SDA contended that by virtue of the doctrine of separation of church and state, the Labor Arbiter and the NLRC have no jurisdiction to entertain the complaint filed by Austria. Since the matter at bar allegedly involves the discipline of a religious minister, it is to be considered a purely ecclesiastical affair to which the State has no right to interfere. Issue: Do the Labor Arbiter and the NLRC have jurisdiction to try and decide the complaint filed by Austria against the SDA?

While the matter at hand relates to the church and its religious minister it does not ipso facto give the case a religious significance. What is involved here is the relationship of the church as an employer e mployer and the minister as an employee. e mployee. The matter of terminating an employee, which is purely secular in nature, is different from the ecclesiastical act of expelling a member from the religious congregation. As such, the State, through Labor Arbiter theand NLRC, the right to takethecognizance of theand case to has determine whether the SDA, as employer, rightfully exercised its management prerogative to dismiss an employee. This is in consonance with the mandate of the Constitution to afford full protection to labor. Under the Labor Code, the provision which governs the dismissal of employees, is comprehensive enough to include religious corporations, such as the SDA, in its coverage. Article 278 of the Labor Code on postemployment states that "the provisions of this Title shall apply to all establishments or undertakings, whether for profit or not." Obviously, the cited article does not make any exception in favor of a religious corporation. is made more by the fact that the RulesThis Implementing theevident Labor Code,  particularly, Section 1, Rule 1, Book VI on the Termination of Employment and Retirement, categorically includes religious institutions in the coverage of the law, to wit: Sec. 1. Coverage. —  This  This Rule shall apply to all establishments and undertakings, whether operated for profit or not, including educational, medical, charitable and religious institutions and organizations, in cases of regular employment with the exception of the Government and its  political subdivisions subdivisions including including government-

Ruling: Yes, they have jurisdiction. The principle of separation of church and state finds no application here. The case at bar does not concern an ecclesiastical or purely religious affair as to bar the State from taking cognizance of the same. An ecclesiastical ecclesiastic al affair involves the relationship between the church and its members and relate to matters of faith, religious doctrines, worship and governance of the congregation. To be concrete, examples of this so-called ecclesiastical ecclesiastical affairs to which the State cannot meddle are proceedings for excommunication, excommunication, ordinations of religious ministers, administration administration of sacraments and other activities with attached religious significance.

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owned or controlled corporations.

3. Eviota vs. Court of Appeals 407 SCRA 394

FACTS: Sometime on January 26, 1998, the respondent Standard Chartered Bank and petitioner Eduardo G. Eviota executed a contract of employment under which the petitioner was employed by the respondent  bank as Compensation and Benefits Manager, VP (M21). Petitioner came up with many proposals which bank approved and like made preparations He wasthe also given privileges car, renovation of. of 7

 

LABOR STANDARDS LAW

the office, and even a trip to Singapore at the company‘s expense. company‘s  expense. However, the petitioner abruptly resigned from the respondent bank barely a month after his employment and rejoined his former employer. On June 19, 1998, the respondent bank filed a complaint against the petitioner with the RTC of Makati City for damages brought about his abrupt

material allegations of the complaint and the reliefs  prayed for in relation to the law involved. Not every controversy or money claim by an employee against the employer or vice-versa is within the exclusive  jurisdiction of the labor arbiter. A money claim by a worker against the employer or vice-versa is within the exclusive jurisdiction of the labor arbiter only if

resignation. Thoughbypetitioner the amount demanded Standard,reimbursed he was not part able of topay it full. Standard alleged that assuming arguendo that had the right to terminate his employment with the Bank for no reason, the manner in and circumstances under Eviota which he exercised the same are clearly abusive and contrary to the rules governing human relations, governed by the Civil Code. Further, Standard alleged that petitioner also violated the Labor Code when he terminated his employment without one (1) notice in advance. This stipulation was also provided in the employment contract of Eviota with Standard, which would also constitute  breach of contract. The petitioner filed a motion to dismiss the complaint on the ground that the action for damages of the respondent bank was within the exclusive jurisdiction of the Labo Arbiter under  paragraph 4, Article 217 of the Labor Code of the Philippines, as amended. The petitioner averred that the respondent bank‘s respondent bank‘s claim  claim for damages arose out of or were in connection with his employer-employee relationship with the respondent bank or some aspect or incident of such relationship. The respondent bank opposed the motion, claiming that its action for damages was within the exclusive jurisdiction of the trial court. Although its claims for damages incidentally involved an employer-employee relationship, the said claims are actually predicated on the  petitioner‘s  petitioner‘s   acts and omissions which are separately, specifically and distinctly governed by the  New Civil Code. Code.

HELD: The SC held that the RTC has jurisdiction. Case law has it that the nature of an action and the

there between the claim is a reasonable asserted causal and connection employee-employer relation. Absent such a link, the complaint will be cognizable by the regular courts of justice. Actions  between employees and employer where the employer-employee relationship is merely incidental and the cause of action precedes from a different source of obligation is within the exclusive  jurisdiction of the regular court. The jurisdiction of the Labor Arbiter under Article 217of the Labor Code, as amended, is limited to disputes arising from an employer-employee relationship which can only  be resolved by reference to the Labor Code of the Philippines, other labor laws or their collective  bargaining agreements. Jurisprudence has evolved the rule that claims for damages under paragraph 4 of Article 217, to be cognizable by the Labor Arbiter, must have a reasonable causal connection with any of the claims provided for in that article. Only if there is such a connection with the other claims can the claim for damages be considered as arising from employeremployee relations. In this case, the private respondent‘s first cause of action for damages is anchored on the petitioner‘s employment of deceit and of making the private respondent believe that he would fulfil his obligation under the employment contract with assiduousness and earnestness. The  petitioner volte face when, without the requisite thirty-day notice under the contract and the Labor Code of the Philippines, as amended, he abandoned his office and rejoined his former employer; thus, forcing the private respondent to hire a replacement replacement.. The private respondent was left in a lurch, and its corporate plans and program in  jeopardy and disarray. Moreover, Moreover, the petitioner took off with the private respondent‘s computer diskette,  papers and documents containing confidential information on employee compensation and other  bank matters. On On its second cause of action, the  petitioner simply walked away a way from his employment

subject matter thereof, as well as which court has  jurisdiction over the same, are determined by the

with the private respondent sans any written notice, to the prejudice of the private respondent, its banking

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ISSUE: Whether or not the RTC had jurisdiction over the case.

 

LABOR STANDARDS LAW

operations and the conduct of its business. Anent its third cause of action, the petitioner made false and derogatory statements that the private respondent reneged on its obligations under their contract of employment; thus, depicting the private respondent as unworthy of trust. The primary relief sought is for liquidated damages for breach of a contractual obligation. The other demanded are not labor benefits demanded byitems workers generally taken cognizance of in labor disputes, such as  payment of wages, overtime compensation or separation pay. The items claimed are the natural consequences flowing from breach of an obligation, intrinsically a civil dispute. It is evident that the causes of action of the private respondent against the  petitioner do not involve the provisions of the Labor Code of the Philippines and other labor laws but the  New Civil Code. Thus, the said causes of action are intrinsically intrinsical ly civil. There is no causal relationship  between the causes of action of the private respondent‘s causes of action against the petitioner and their employer-employee relationship. The fact that the private respondent was the erstwhile employer of the petitioner under an existing employment contract before the latter abandoned his employment is merely incidental. Petition is denied. 4. DYNAMIC SIGNMAKER OUTDOOR ADVERTISING SERVICES, INC. vs. FRANCISCO POTONGAN G.R. No. 156589 June 27, 2005 

FACTS: In 1987, respondent started working foratpetitioner corporation as a Production Supervisor a monthly 3 salary ofP16,000.00. ofP16,000.00.   In early February 1996, the union of rank and file employees of petitioner corporation, the BigkisManggagawasaDynamicSignmakers Outdoor Advertising Services –  Services –    KilusanngManggagawangMakabayan (KMM KilusanngManggagawangMakabayan Katipunan),,4declared a strike on account of which Katipunan)  petitioner corporation corporation replaced all its supervisors supervisors and designated, by letter memorandum5 dated February 16, 1996, certain persons to take over the operations of the corporation including Rufino Hornilla Hornilla 6 who took over petitioner‘s functions.  functions. 

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By February 21, 1996, respondent‘s salary was withheldd7 and was advised to take a leave of absence withhel until further notice. notice.8  Respondent later received on February 28, 1996 a letter from petitioner Filomeno P. Hernandez, President/General President/Gene ral Manager of the corporation, "inviting" him to answer the following charges: 1.) That on February 21, 1996, at around 9:00 A.M. you entered the company fabrication shop where you were assigned as supervisor and caused to create fire  by secretly switching switching ‗on‘ the the idle plastic plastic oven and grounded the 2 electric machine welders while the ‗strike‘ was on-going on-going outside the premises. Witnesses also in the persons of Mr. Luis Mimay, and his men found out later what you have done and noticed the electric current and the burning of the oven already very hot. You secretly left the premises and had not for the said witnesses and contractors, you had vehemently caused to burn the company‘s main building and its offices. 2.) That you allegedly on several occasions, urged strongly the same group of contractors led by Mr. Luis Mimay, working on some left over jobs at the factory, to slow down work or not to work at all in sympathy to the ‗strikers‘who ‗strikers‘who are in the ranking files. Those proved also that as our trusted staff and supervisor you have caused disruption of work of the contractors. The company suffered losses in its failure to accomplish its job projects on due dates. Your actuations and actions proved disastrous to the company‘s interest. Considering these circumstances, we urge you to reply your side on these matters so that we could institute proper corresponding action  based on the above above in 5 days time time from receipt of this letter .9 (Underscorin (Underscoringg supplied) By letter of March 4, 1996, respondent through counsel, denied the charges proffered against him, he insisting that they were fabricated to justify his termination due to suspicions that he was a strikesympathizer .10 In the same letter, respondent expressed his openness to the conduct of a full-blown investigation of the case by the NLRC. NLRC.11  Respondent later filed on January 29, 1997 a complaint against herein petitioners for illegal dismissal, reinstatement, reinstatement, backwages and a nd damages with the Regional Arbitration Branch of the NLRC, docketed as NLRC Case No. RAB-IV-1-8738-97RI RI,,12 the case subject of the petition.

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Respondent complained that although he was not sent a formal notice of termination, he was effectively dismissed from employment for after he was asked to take a leave of absence on February 21, 1996, as he did, and he was not instructed nor allowed to return to work, nor paid his salaries. salaries.13  By Decision Decision30 of September 30, 2002, the appellate court reversed NLRC holding respondent wasthe denied duedecision, process itand was that dismissed without cause when he was replaced by RufinoHornillaa and instructed to go on leave RufinoHornill indefinitely..31  indefinitely In reversing the NLRC decision, the appellate court noted that it was on account of respondent‘s replacement as Operations Manager and the instruction for him to go on indefinite ind efinite leave that it took almost a year for him to file the complaint for illegal dismissal. Hence, the appellate court concluded, he should not be faulted for laches. Nor, said the appellate court, could respondent be deemed to have abandoned his work on receipt of petitioner‘s counsel‘s return to work March himself 1, 1999 illegally letter because  prior thereto he had he considered ill egally terminated as in fact he had filed on January 29, 1997 the complaint for illegal dismissal. dismissal.32  ISSUE: Petitioners insist that respondent was not illegally dismissed, "management [having] merely opted to reorganize," hence, the award to him of full  backwages, reinstatement reinstatement or separation pay, and attorney‘s fees is bereft of factual and legal basis. basis.33  HELD: This Court upholds then the appellate appellat e court‘s finding that respondent was constructively dismissed: There is no doubt, therefore, that the petitioner in this case was effectively terminated from employment by respondent when he was replaced as Operations Manager and instructed to take a leave indefinitely. Petitioner was neither transferred nor reassigned to another office or position contrary to what public respondent seems to allude. Petitioner was simply replaced and instructed to take a leave indefinitely. "In cases of illegal dismissal, the burden is on o n the employer to prove that there was a valid ground for dismissal." Medenilla vs. Philippne Veterans Bank, 328 SCRA 1, 7. We failed to extract from the record any evidence to show that there exists valid and just

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cause to terminate herein petitioner from employment. In fact during the pendency of the complaint for illegal dismissal by the petitioner against private respondents, the latter in a letter dated March 1, 1999, ordered petitioner to report back to work immediately. This in itself proves that herein  private respondents respondents believe that there exists no valid and just grounds (sic) to terminate herein petitioners 42

from his employment. employment.  (Underscoring supplied) It upholds too the award to respondent of attorney‘s fees in the amount of P50,000.00, he having been forced to litigate and thereby incur expenses to  protect his rights rights and interests interests..43  Clutching at straws, petitioners fault the appellate court for failure to recognize the final and executory nature of the June 24, 1996 NLRC Decision rendered in the consolidated cases and for affirming the nullification of said decision, with respect to respondent, which could be attacked only by direct action..44  action Contrary to petitioners‘ position, the validity of a  judgment or order of a court or quasi-judicial tribunal tribunal which has become final and executory may be attacked when the records show that it lacked  jurisdiction to to render the judgment judgment..45 For a judgment rendered against one in a case where jurisdiction over his person was not acquired is void, and a void  judgment maybe assailed or impugned impugned at any time either directly or collaterally by means of a  petition filed filed in the same or separate case, or by resisting such judgment in any action or proceeding wherein it is invoked. invoked.46  Petitioners in fact do not even dispute respondent‘s respondent‘s claim that no summons was ever issued and served on him either personally or through registered mail as required under Rule III, Sections 3 and 6 of the Rules of Procedure of the NLRC, as amended by Resolution No. 01-02, Series of 2002: SEC. 3. Issuance of Summons. Within two (2) days from receipt of a case, the Labor Arbiter shall issue the required summons, attaching thereto a copy of the complaint/petition complaint/pet ition and supporting documents, if any. The summons, together with a copy of the complaint, shall specify the date, time and place of the conciliation and mediation conference in two (2) settings. xxx

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SEC. 6. Service of Notices and Resolutions.  a)  Notices or summonses summonses and copies of orders, shall shall be served on the parties to the case personally by the  bailiff or duly authorized public public officer within within three (3) days from receipt thereof or by registered mail,  provided that in in special circumstances, circumstances, service service of summons may be effected in accordance with the  pertinent provisions provisions of the Rules Rules of Court; xxx xxx Supplementary or applied by analogy to these  provisions are the provisions and prevailing  jurisprudence in in Civil Procedure. Where Where there is then then no service of summons on or a voluntary general appearance by the defendant, the court acquires no  jurisdiction to to pronounce a judgment judgment in the cause. cause.47  At all events, even if administrative tribunals exercising quasi-judicial powers are not strictly  bound by procedural requirements, requirements, they are still still  bound by law and and equity to observe observe the fundamental fundamental requirements of due process. process.48   Res inter aliosactanocerenondebet. Things done

 between strangers strangers ought not to injure those who who are not parties to them. them.49 

Respondent, because of tardiness was supposedly terminated by the petitioner company, but  because of the timely intervention of the union, the dismissal was not effected. However, he incurred another infraction when he obtained a loan from a magazine dealer   not able to pay the loan and when he was he stopped collecting the outstanding dues  of , the dealer/creditor. After requiring him to explain, respondent admitted his failure to pay the loan but gave no definitive explanation for the same. Thereafter, he was penalized with suspension. He was also not allowed to do field work, and was transferred to a new position. Despite the completion of his suspension, respondent stopped reporting for work and sent a letter communicating his refusal to accept the transfer. He then filed a complaint for constructive dismissal, non-payment of  backwages and other money claims with the labor arbiter.

WHEREFORE, the instant petition is hereby DENIED. The decision of the appellate court is hereby AFFIRMED with the MODIFICATION MODIFICATION that if reinstatement is no longer possible due to strained relations between the parties, petitioners are ordered to pay respondent, Francisco Potongan, separation  pay equivalent to One Month salary salary for every year year of service, computed from the time he was first employed until the finality of this decision.

The complaint was resolved in favor of respondent. Petitioner lodged lodged an appeal with with the  NLRC, raising as a ground the lack of jurisdiction of the labor arbiter over respondent‘s re spondent‘s complaint. Significally, this issue was not raised by petitioner in the proceedings before the Labor Arbiter.

SO ORDERED.

The NLRC reversed the decision of the LA and ruled that the LA has no jurisdiction over the

5. METROMEDIA TIMES CORPORATION and/or ROBINA GOKONGWIE PE,   v. Johnny Pastorin G.R. NO. 154295. July 29, 2005  

FACTS:  Johnny Pastorin (Respondent) was employed by Metromedia Times Corporation (Petitioner) on 10 December 1990 as a Field Representative/Collector. His task entailed the  periodic collection of receivables from dealers of

 petitioner's newspapers. newspapers.

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case, it being a grievance issue properly cognizable  by the voluntary arbitrator. However, the CA reinstated the ruling of the CA. The CA held that the active participation of the party against whom the action was brought, coupled with his failure to object to the jurisdiction of the court or quasi-judicial body where the action is pending, is tantamount to an invocation of that jurisdiction and a willingness to abide by the resolution of the case and will bar said  party from later on impugning the court or body‘s  jurisdiction. ISSUE: 

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Whether or not petitioner is estopped from questioning the jurisdiction of the LA during appeal. HELD:

 jurisdiction. Here, the principle of estoppel applies. The rule that jurisdiction is conferred by law, and does not depend upon the will of the parties, has no  bearing thereon.

The SC held that petitioner is not estopped from questioning the jurisdiction of the LA during appeal. The general rule is that the jurisdiction of a court over the subject matter of the action is a matter of law and may not be conferred by consent or agreement of the parties.  The lack of  jurisdiction of a court may be raised at any stage of the proceedings, even on appeal . This doctrine has  been qualified by recent pronouncements which stemmed principally from the ruling in the cited case of Sibonghanoy. It is to be regretted, however, that the holding in said case had been applied to situations which were obviously not contemplated therein. The exceptional circumstances involved in Sibonghanoy which justified the departure from the accepted concept of non-waivability of objection to  jurisdiction has been ignored and, instead a blanket doctrine had been repeatedly upheld that rendered the supposed ruling in Sibonghanoy not as the exception,  but rather the general rule, virtually overthrowing altogether the time honored principle that the issue of  jurisdiction is not lost by waiver waiver or by estoppel. estoppel.

The operation of the principle of estoppel on the question of jurisdiction seemingly depends upon whether the lower court actually had jurisdiction or not. If it had no jurisdiction, but the case was tried and decided upon the theory that it had  jurisdiction, the parties are not barred, on appeal, from assailing such jurisdiction, for the same 'must exist as a matter of law, and may not be conferred by consent of the parties or by estoppel.   However, if the lower court had jurisdiction, and the case was heard and decided upon a given theory, such, for instance, as that the court had no  jurisdiction, the party who induced it to adopt such theory will not be permitted, on appeal, to assume an inconsistent position — that that the lower court had

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Applying the general rule that estoppel does not from conferassailing jurisdiction, petitioner of is not estopped the jurisdiction the labor arbiter before the NLRC on appeal.

Decision of the CA is set aside.

YUSEN AIR AND SEA SERVICE PHILIPPINES, INCORPORATED,petitioner vs. ISAGANI A. VILLAMOR,respondent

Facts: -Petitioner,is engaged in the business of freight forwarding. As such, it is contracted by clients to  pick-up, unpack, consolidate, deliver, deliver, transport and distribute all kinds of cargoes, acts as cargo or freight accommodation and enters into charter parties for the carriage of all kinds of cargoes or freight.

-On 1993, petitioner hired respondent as branch manager in its Cebu Office. Later, petitioner reclassified respondent‘s position to that of Division Manager, position1,respondent held until his resignationwhich on February 2002. - Immediately after his resignation, respondent started working for Aspac International , a corporation engaged in the same line of business as that of petitioner. - On February 11, 2002,petitioner filed against respondent a complaint complaint[3] for injunction and damages with prayer for a temporary restraining restraining order, the the inter alia, complaint alleged, as follows:

7.

That [respondent] duly signed an 12

 

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undertaking to abide by the policies of the [Petitioner] which includes the provision on the employees‘ responsibility and obligation in cases of conflict of interest, which

- the 2-year prohibition against employment in a competing company which petitioner seeks to enforce thru injunction, had already expired sometime in February 2004. Necessarily, upon the expiration of said period, a suit seeking the issuance of a writ of injunction becomes  functusoficio and therefore moot.

reads: 2nd issue:  No employee may may engage in any business or undertaking that is directly or indirectly in competition with that of the company and its affiliates or engage engage directly or indirectly indirectly in any undertaking or activity prejudicial to the interests of the company or to the performance of his/her job or work assignments. The same provision will be implemented for a period of two (2) years from the date of an employee’s resignation, termination or separation from the company. -Petitioner thus thus prayed for a judgment enjoining respondent from ―further pursuing his work at at  Aspac  Aspac  International”, and awarding it P2,000,000 as actual damages; P300,000 as exemplary damages;

- respondent filed against petitioner a case for illegal dismissal before the National Labor Relations Commission. - Meanwhile, instead of filing his answer, respondent filed a Motion to Dismiss,arguing that the RTC has no jurisdiction over the subject matter of said case because an employer-employe employer-employeee relationship is involved.

1st issue: With regards to the 2 yr prohibition

HELD:

-The petition is impressed with merit.

With regards to the claim for damages *whether petitioner's claim for damages arose from employer-employee relations between the  parties.

HELD:

 In Dai-Chi Villarama, with

Electronics

Manufacturing

vs.

a substantially similar factual  backdrop, we held that an action for breach of contractual obligation is intrinsically a civil dispute.

There, a complaint for damages was filed with the regular court by an employer against a former employee who allegedly violated the non-compete  provision of their employment contract when, within two years from the date of the employee‘s resignation, he applied with, and was hired by a corporation engaged in the same line of business as that of his former employer. The employer sought to recover liquidated damages. The trial court ruled that it had no jurisdiction over the subject matter of the controversy because the complaint was for damages arising from employer-employee relations, citing Article 217 (4) of the Labor Code, as amended by R.A. No. 6715, which stated that it is the Labor Arbiter who had original and exclusive jurisdiction over the subject matter of the case.

When the case was elevated to this Court, we held that the claim for damages did not arise from employer-employee employer-empl oyee relations, to wit:

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exempla ry and other forms of damages arising from the employe

Petitioner does not ask for any relief under the Labor Code of the Philippines. Philippines. It seeks to recover recover damages agreed upon in the contract as redress for  private respondent‘s breach of his contractual obligation to its ―damage and prejudice‖. Such cause of action is within the realm of Civil Law.

remploye e relations ;"

-Indeed, jurisprudence has evolved the rule that claims for damages under paragraph 4 of Article 217, to be cognizable by the Labor Arbiter, must have a reasonable causal connection with any of the claims  provided for in that article. Only if there is such a connection with the other claims can a claim for damages be considered as arising from employeremployee relations.

xxx

xxx

xxx

- In San Miguel Corporation vs. National Labor  Relations Commission

Article 217, as amended by Section 9 of RA 6715, provides: “While

Art. 217. Jurisdiction of Labor Arbiters and the Commission.  —   (a) Except as otherwise provided under this Code, the Labor Arbiters shall have original and exclusive jurisdiction to hear and decide, within thirty (30) calendar days after the submission of the case by the  parties for decision without extension, even in the of stenographic notes, theabsence following cases involving all workers, whether agricultural or nonagricultural:

xxx

xxx

4.

xxx

Clai ms for actual, moral,

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paragraph 3 above refers to ―all money claims of workers,‖ it is not necessary to suppose that the entire universe of money claims that might be asserted by workers against their employers has been absorbed into the original and exclusive jurisdiction of Labor Arbiters. Arbiters. In the first place, paragraph 3 should be read not in isolation from but rather within the context formed by paragraph 1 (relating to unfair labor practices), paragraph 2 (relating to claims concerning terms and conditions of employment),  paragraph 4 (claims relating to household services, a  particular species of employer-employee relations), and paragraph 5 (relating to certainIt isactivities  prohibited to employees or employers). evident that there is a unifying element which runs through  paragraph 1 to 5 and that is, that they all refer to cases or disputes arising out of or in connection with an employer-employee relationship.

For it cannot be presumed that money claims of workers which do not arise out of or in connection with their employer-employee relationship, and which would therefore fall within the general  jurisdiction of regular regular courts of justice, justice, were intended  by the legislative authority to be taken away from the  jurisdiction of exclusive the courtsbasis. and The lodged Labor Arbiters on an Court,with therefore, 14

 

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 believes and so holds that the ―money claims claims of workers‖ referred to in paragraph 3 of Article 217 embraces money claims which arise out of or in connection with the employer-employee relationship, or some aspect or incident incident of such relationship. relationship. Put a little differently, differently, that money claims of workers which now fall within the original and exclusive jurisdiction of Labor Arbiters are those money claims which have reasonable causal connection  with some employer-employee employeremployee relationship.‖  relationship.‖  

 

The Labor Arbiter awarded the back wages including an order for reinstateme reinstatement; nt; this was, however, reversed by NLRC;   A motion for reconsideration was likewise dismissed by NLRC;   A petition for Certiorari under Rule 65 was filed by Mojica before the CA, which court



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the

granted the reliefs prayed for; Duty Free  petitioned before before the SC; Issue

-With the reality that the stipulation refers to the postpost employment relations of the parties.

For sure, a plain and cursory cursory reading of the complaint will readily reveal that the subject matter is one of claim for damages arising from a breach of contract, which is within the ambit of the regular court‘s jurisdiction jurisdiction

1.  Whether the filing by Mojica of the complaint before the NLRC was proper 2.  What is the nature of DFP? 3.  What is the tribunal clothed with jurisdiction to try civil service cases? Held

1.   No, DFP being a government agency agency attached with DOT, complaints against it are not cognizable by NLRC. 2

Duty Free Philippines v. Rossano Mojica, GR No. 166365, 30 September 2005, First Division, Ynares-Santiago1 Pri nciples of l aw:   Complaints of civil service  Complaints

employees come under the jurisdiction of the CSC and not NLRC; any decision of the Labor Arbiter involving a CS employee is void for want of  jurisdiction

Facts  

Mojica was an employee of Duty Free Philippines who was charged with neglect resulting to considerable damage to or loss of materials, assets and properties of DFP;   Hence, the discipline committee of Duty Free considered her resigned with forfeiture of all benefits except salary and accrued leave credits;   As a result a complaint co mplaint for illegal dismissal with prayer of full back wages and reinstatement was filed by Mojica before the  NLRC;

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1 19 August 2014. UNIVERSITY OF SAN CARLOS SCHOOL OF LAW AND GOVERNANCE

DFP was created under Executive Order (EO) No. 46 on September 4, 1986 primarily to augment the service facilities for tourists and to generate foreign exchange and revenue for the the government. In order for the the government to exercise direct and effective control and regulation over the tax and duty free shops, their establishment and operation was vested in the Ministry, now Department of Tourism (DOT), through its implementing arm, the Philippine Tourism To urism Authority (PTA). All the net profits from the merchandising operations of the shops accrued to the DOT. 2.  EO No. 292 or The Administrative Code of 1987 empowered the Civil Service Commission to hear and decide administrative administrat ive cases instituted by or brought  before it directly directly or on appeal, including contested appointments, and review decisions and actions of its offices and of the t he agencies attached to it. 2 Note that it was initially decided upon by the Labor Arbiter. NLRC in fact dismissed the petition 15

 

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2.  Whether or not respondent Edward King was validly dismissed 8. Easycall Communications Phils., Inc vs. Edward King Facts:

Petitioner Easycall Communications Communications Phils., Inc was a domestic corporation engaged in the business of message handling. On May 1992, petitioner, through its general manager, Roberto Malonzo, hired the services of respondent as assistant to the general manager. He was given the responsibility of ensuring that the expansion plans outside Metro Manila and Metro Cebu were achieved as soon as possible. In an Memo dated Aug 14, Mr. RT Casas, respondent‘s immediate superior, recommended his  promotion to assistant vice president for nationwide expansion. On December 22, respondent was appointed to the even higher position. His promotion was based his performance for the preceding 6 months of his appointment. As VP, he became responsible for the sales and rentals of pager units in the expansion areas. He also coordinated with the dealers. Sometime in March 1993, Malonzo reviewed King‘s sales performance. He also scrutinized status of  petitioner‘s Nationwide Expansion program (NEP) which was under King‘s responsibility. The management then confronted respondent. On April 1993, Rockwell Gohu, petitioner‘s deputy manager, talked to respondent and told him that Malonzo wanted respondent‘s resignation. He then wrote a letter confronting Malonzo. On 19 1993, he received termination fromApril Malonzo effective April 30 awith the reasonletter that the management is no longer confident with him for the position he‘s occupying. Aggrieved, respondent filed a complaint for illegal dismissal with NLRC. LA found the termination ground for loss of confidence valid. On appeal, NLRC affirmed that decision of LA but ordered petitioner to indemnify respondent for lack of due process. MR dismissed. Filed certiorari before CA.CA held NLRC lacked  jurisdiction and that there was illegal dismissal. Petitioner filed MR, denied. Hence, this petition. Issue/s:

1.  Whether or not NLRC had jurisdiction over the case of respondent‘s illegal dismissal  dismissal  

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Ruling:

SC ruled first with  jurisdiction   as it is decisive. If  NLRC has no jurisdiction, then it would be unnecessary to talk about the validity of dismissal. Petitioner contends that it is SEC, and not the NLRC, who has jurisdiction since respondent was a ―corporate officer.‖ Is respondent a corporate corporate officer? Here, petitioner failed to prove that respondent was a corporate officer. ―Corporate officers‖ are those officers who are given that character under the Corporation Code. Under Section 25 thereof, the ―corporate officers‖ are the  president, secretary, secretary, treasurer and such other officers as may be provided by the by-laws. Since petitioner failed to satisfy burden of proof that was required of it, we cannot sanction its claim that respondent was by a corporate officer was cognizable the SEC under PDwhose 902-Aremoval and not  by NLRC. An ―office‖ is created by the charter of the corporation and the officer is elected by the directors and stockholders. On the other hand, employee occupies no office and generally is employed not by the action of the directors or stockholders but by the managing officer of the corporation who also determines compensation of employee. Respondent was appointed VP by Malonzo,  petitioner‘s manager, not by the board of directors. It was also Malozo who determined respondent‘s re spondent‘s compensation package. Thus, respondent was an employee, not a corporate officer. The CA was correct in ruling that jurisdiction over the case was  properly with NLRC, not with SEC. Validity of the Dismissal

While loss of confidence is a valid ground for dismissing the employee, it should not be simulated. It must not be indiscriminately used as a shield by the employer against a claim that the dismissal was arbitrary. Loss of trust and confidence must be based on a willful  breach and founded on cleary established facts. A breachknowingly is willful if itand is done intentionally, 16

 

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In this case, LA‘s finding, was was that sales record of respondent at the time he spent work in the field were clear indications of complainant‘s co mplainant‘s inefficiency inefficiency and/or

On November 9, 1992, some employees of SMFI's Finance Department, through the Union represented by Edgar Moraleda, brought a grievance against Finance Manager Gideon Montesa (Montesa), for "discrimination, favoritism, unfair labor practices, not flexible [sic], harassment, promoting divisiveness and sectarianism, etc.," before SMFI Plant Operations

negligence.andInefficiency implies ignorance carelessness. They wereincompetence, not sufficient to claim a loss of confidence as a ground for dismissal.

Step 1 of Manager George Nava inadopted accordance with the grievance machinery in the Collective Bargaining Agreement (CBA) forged by SMFI and the Union.

 purposely, without justifiable excuse as opposed to carelessness, thoughtlessness thoughtlessness and heedlessness. It cannot be from mere carelessness.

Moreover, the promotion of the employee negates the employer‘s claim that it has lost its trust and confidence on the employee. The lack of cause in respondent‘s dismissal was aggravated by the absence of due process. The twin requirements of notice and hearing constitute the essential elements of due process. The law requires the employer to furnish the employee sought to be dismissed 2 written notices before termination can be legally effected: 1.  Written notice apprising the employee of the particular acts for which his dismissal is sought to afford him an opportunity to be heard and defend himself 2.  Subsequent notice informing employer‘s decision.

The Union sought: 1. review, evaluation & upgrading of all Finance staff and 2. promotion of G.Q. Montesa to other SMC affiliates & subsidiaries. January 14, 1993- A grievance meeting was held by SMFI informing the Union that a ―work management review‖ to be completed on March M arch 1993 would be done to address the grievence, asking the finance personnel to give it their attention. The "work management review" was not completed by March 1993, however, prompting the Union to, on March 26, 1993, 199 3, elevate the grievance to Step 2.

The procedure above is MANDATORY and its absence taints the dismissal with illegality. In the case at bar, respondent was only served with 1 notice  –  notice  notice of his termination.

Almost nine months after the grievance meeting was held or on October 6, 1993, SMFI rendered a "Decision on Step 1 Grievance" stating that it was still in the process of completing the "work management review,"  hence,  hence, the Union's requests

Petition is DENIED. CA is affirmed.

could not be granted. October 20, 1993- The Union filed a complaint before the NLRC Arbitration brance against SMFI, its president and Montesa for "unfair labor practice, [and] unjust discrimination in matters of promotion . . .  " It prayed that SMFI et al. be ordered to promote the therein named employees "with the corresponding pay increases or adjustment including payment of salary differentials  plus attorney's fees[,] fees[,] and to cease and desist desist from committing the same unjust discrimination in matters of promotion." promotion."7 

9. SAN MIGUEL FOODS, INC. v. SAN MIGUEL CORPORATION EMPLOYEES UNIONPTWGO  G.R. NO. 168569 168569 October 5, 2007  FACTS:

At the time material to the case, respondent, San Miguel Corporation Employees Union - PTWGO (the Union), was the sole bargaining agent of all the monthly paid employees of petitioner San Miguel Foods, Incorporated (SMFI).

Instead of filing a position paper as is required for stepon2,the SMFI filedthat for that a motion to the issues dismiss instead ground

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LABOR STANDARDS LAW

raised in the complaint were grievance issues and, therefore, "should be resolved in the grievance machinery provided in [the] collective bargaining agreements [sic] of the parties or in the mandated provision of voluntary arbitration which is also provided in the CBA." ISSUE:

Whether respondent's complaint is one for unfair labor practice (ULP) over which a Labor Arbiter has  jurisdiction RULING:

The jurisdiction of Labor Arbiters, enumerated in Article 217 of the Labor Code, includes complaints for ULP. SMFI argues that the allegations in the Union's complaint filed before the Labor Arbiter do not establish a cause of action for ULP, the Union having merely SMFI was guilty thereof withoutcontended specifyingthat the ultimate facts upon which it was based. It cites Section 1 of Rule 8 of the Rules of Court as applying suppletorily to the  proceedings before before the Labor Arbiter, Arbiter, which Section reads:

Section 1. In general . - Every  pleading shall contain in a methodical and logical form, a  plain concise and direct statement of the ultimate facts on which the  party pleading relies for his his claim . .. thatconcludes the Unionthat failed comply with this Alleging Rule, SMFI thetoLabor Arbiter has no jurisdiction over its complaint. A perusal of the complaint shows that, indeed, the particular acts of ULP alleged to have  been committed committed by SMFI were not not specified; neither neither were the ultimate facts in support thereof. In its Position Paper, however, the Union detailed the particular acts of ULP attributed to SMFI and the ultimate facts in support thereof.  Section 7, Rule V of the New Rules of Procedure of the NLRC provides:  Nature of Proceedings. - The

proceedings before the Labor

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Arbiter shall be non-litigious in nature. Subject to the requirements of due process, the technicalities of law and procedure and the rules obtaining in the courts of law shall not strictly apply thereto. The Labor Arbiter may avail himself of all reasonable

means to ascertain theincluding facts of the controversy speedily, ocular inspection and examination of well-informed persons. ( Emphasis  Emphasis and underscoring  supplied )cralawlibrary )cralawlibrary Section 1 of Rule 8 of the Rules of Court should thus not be strictly applied to a case filed  before a Labor Arbiter. Arbiter. In determining determining jurisdiction jurisdiction over a case, allegations made in the complaint, as well as those in the position paper, may thus be considered.

On the questioned promotions, the Union did not allege that they were done to encourage or discourage membership in a labor organization. organization. In fact, those promoted were members of the complaining Union. The promotions do not thus amount to ULP under Article 248(e) of the Labor Code. 

As for the alleged ULP committed under Article 248(i), for violation of a CBA, this Article is qualified by Article 261 of the Labor Code, the  pertinent portion portion of which latter latter Article Article reads: x xx violations of a Collective Bargaining Agreement, except those which are gross in character, shall no longer be treated as unfair labor practice and shall be resolved as grievances under the Collective Bargaining Agreement. For purposes of this article, gross violations of Collective Bargaining Agreement shall mean flagrant and/or malicious refusal to comply with the economic provisions of such agreement. ( Emphasis  Emphasis and underscoring  supplied )cralawlibrary )cralawlibrary 18

 

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Silva v. NLRC  instructs  instructs that for a

ULP case to be cognizable by the Labor Arbiter, and the NLRC to exercise its appellate  jurisdiction, the allegations allegations in the complaint complaint should show prima facie the concurrence of two things, namely: (1) gross violation of the CBA; AND (2) the violation pertains to the economic provisions  Emphasis and underscoring of the CBA.17 ( Emphasis  supplied )cralawlibrary )cralawlibrary As reflected in the above-quoted allegations of the Union in its Position Paper, P aper, the Union charges SMFI to have violated the grievance machinery  provision in the the CBA. The grievance machinery provision in the CBA is not an economic provision, however, hence, the second requirement for a Labor Arbiter to exercise  jurisdiction of a ULP is not present. The Union likewise charges SMFI, S MFI, however, to have violated the Job Security provision in the CBA, specifically the seniority rule, in that SMFI "appointed less senior employees to positions at its Finance Department, consequently intentionally by passing more senior employees employees who are deserving deserving of said appointment." Article 4 of the Labor Code  provides that "All "All doubts in the implementationn and implementatio interpretation of the provisions of this Code, including implementing rules and regulations, shall be resolved in favor of labor." Since the seniority rule in the promotion of employees has a bearing on salary and benefits, it may, following a liberal construction of Article 261 of the Labor Code, be considered an "economic provision" of the CBA.

disregarded the seniority rule under the CBA when its petition before said court merely raised a question of jurisdiction. The Court of Appeals having affirmed the NLRC decision finding that the Labor Arbiter has  jurisdiction over over the Union's complaint and thus thus remanding it to the Labor Arbiter for continuation of  proceedings thereon, thereon, the appellate court's said finding may be taken to have been made only for the purpose of determining jurisdiction.

LEYTE IV ELECTRIC COOPERATIVE, INC.,  vs LEYECO IV Employees Union- ALU,   G.R. No. 157775 October 19, 2007 Facts: The  Leyte IV Electric Cooperative, Inc.  (petitioner) and Leyeco IV Employees Union-ALU   (respondent) entered into a Collective Bargaining Agreement covering petitioner rank-and-file employees, for a period of five (5) years.

The Regional Vice-President, Vicente P. Casilan (for respondent), sent a letter to petitioner demanding holiday pay and in effect enforcing the CBA. Petitioner sent a letter-reply to respondent claiming that it had already paid all employees all the holiday  pay by reviewing the pay slips. After exhausting the procedures of the grievance machinery, both parties agreed to submit their issues for arbitration of the National Conciliation and Mediation Board (NCMB). Petitioner claimed that  payment was presumed since the formula used in determining the daily rate of pay of the covered employees is Basic Monthly Salary divided by 30 days or Basic Monthly Salary multiplied by 12 divided by 360 days, thus with said formula, the employees are already paid their regular and special days, the days when no work is done, the 51 unworked Sundays and the 51 un-worked Saturdays.

As above-stated, the Union charges SMFI to have promoted less senior employees, e mployees, thus bypassing others who were more senior and equally or more qualified. It may not be seriously disputed that this charge is a gross or flagrant violation of the seniority rule under the CBA, a ULP over which the Labor Arbiter has jurisdiction.

Issue: WON Leyte IV Electric Cooperative is liable for underpayment of holiday pay.

SMFI, at all events, questions why the Court of Appeals came out with a finding that it (SMFI)

discretion in giving a strict or literal interpretation of the CBA provisions that the holiday pay be reflected

UNIVERSITY OF SAN CARLOS SCHOOL OF LAW AND GOVERNANCE

19

Held: Leyte IV Electric Cooperative is not liable for underpayment of holiday pay. 

The Voluntary Arbitrator gravely abused its

 

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in the payroll slips. Such S uch literal interpretation ignores the admission of respondent in its Position Paper that the employees were paid all the days of the month even if not worked. In light of such admission,  petitioner's submission of its 360 divisor in the computation of employees' salaries gains significance.

 being given their holiday pay. Thus, the Voluntary Arbitrator should not have simply brushed aside  petitioner's divisor formula. In granting respondent's claim of non-payment of holiday pay, a "double  burden" was imposed upon petitioner because it was  being made to pay twice for its employees' holiday  pay when payment thereof had already been included

This ruling was applied in Wellington Investment and Manufacturing Corporation v. Trajano, 43 Producers Bank of the Philippines v. National Labor Relations Commission. In this case, the monthly salary was fixed by Wellington to provide for compensation for every working day of the year including the holidays specified by law  —  and   and excluding only Sundays. In fixing the salary, Wellington used what it called the "314 factor"; that is, it simply deducted 51 Sundays from the 365 days normally comprising a year and used the difference, 314, as basis for determining the monthly salary. The monthly salary thus fixed actually covered payment for 314 days of the year, including regular and special holidays, as well as days when no work was done by reason of fortuitous cause, such as transportation strike, riot, or typhoon or other natural calamity, or cause not attributable to the employees.

in the computation of their monthly salaries.

It was also applied in Odango v. National Labor Relations Commission, where Court ruled that the use of a divisor that was less than 365 days cannot make the employer automatically liable for underpayment of holiday pay. In said case, the employees were required to work only from Monday to Friday and half of Saturday. Thus, the minimum allowable divisor is 287, which is the result of 365 days, less 52 Sundays and less 26 Saturdays (or 52 half Saturdays). Any divisor below 287 days meant that the employees were deprived of their holiday pay for some or all of the ten legal holidays. The 304-day divisor used by the employer was clearly above the minimum of 287 days. In this case, the employees are required to work only from Monday to Friday. Thus, the minimum allowable divisor is 263, which is arrived at by deducting 51 un-worked Sundays and 51 un-worked Saturdays from 365 days. Considering that petitioner used the 360-day divisor, which is clearly above the minimum, indubitably, petitioner's employees are

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11.) GR No. 173115 & 173163-64, April 16, 2009 Atty Garcia vs. Eastern Telecommunications Phils., et al., FACTS:

Atty. Virgilio R. Garcia was placed under  preventive suspension for complaints of sexual harassment. After the period of preventive suspension, Atty. Garcia was terminated as Vice President and Head of Business Support Services and Human Resource Departments Eastern Telecommunications Philippines, of Inc. the (ETPI) by Atty. Salvador C. Hizon, President/Chief Executive Officer of ETPI. Aggrieved by his termination from ETPI, Atty. Garcia filed a case before the National Labor Relations Commission (NLRC) for illegal dismissal with prayer for full back wages. The Labor Arbiter ruled that the preventive suspension and the subsequent dismissal of Atty. Garcia are illegal. However, the NLRC, on appeal, dismissed the case for lack of jurisdiction. Unperturbed, Atty. Garcia appealed the dismissal of the case to the Court of Appeals (CA). Upon review of the case, the appellate court dismissed the case for lack of merit. The appellate court ruled that Atty. Garcia, being the Vice President for Business Support Services and Human Resource Departments of ETPI, was a corporate officer at the time he was removed. Being a corporate officer, officer, his removal was a corporate act and/or an intra-corporate controversy, the jurisdiction of which rested with the Securities and Exchange Commission (now with the Regional Trial Court), and not the Labor Arbiter and the  NLRC. It added that ETPI and Atty. Hizon were not estopped from questioning the jurisdiction of the Labor Arbiter before the NLRC on appeal, inasmuch as said issue was seasonably raised by ETPI and Atty. Hizon in their reply memorandum before the Labor Arbiter. Atty. Garcia is now before us via a Petition for Review, which he filed on 3 August 2006. The 20

 

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 petition was docketed as G.R. No. 173115. On 8 August 2006, he filed an Amended Petition for Review.He prays that the decision of the NLRC dated 21 March 2003 and its resolution dated 16 December 2003, and the decision of the Court of Appeals dated 24 March 2006 and its resolution dated 14 June 2006,  be reconsidered and set aside and that the decision of the Labor Arbiter dated 30 September 2002 be affirmed and reinstated. ISSUE:  Whether or not the Labor Arbiter has the  jurisdiction over the case RULING:Labor Arbiter has no jurisdiction over the case

The Supreme Court, in a long line of cases, has decreed that a corporate officer‘s dismissal or removal is always a corporate act and/or an intracorporate controversy, over which the Securities and Exchange Commission [SEC] (now the Regional Trial Court) has original and exclusive jurisdiction.

cashier, auditor or general manager. The number of corporate officers is thus limited by law and by the corporation‘s by-laws. by-laws. In the case before us, the by-laws of ETPI  provide: ARTICLE V Officers Section 1. Number .  –   The officers of the Company shall be a Chairman of the Board, a President, one or more Vice-Presidents, a Treasurer, a Secretary, an Assistant Secretary, and such other officers as may be from time to time be elected or appointed by the Board of Directors. Directors. One person may hold any two compatible offices. Atty. Garcia tries to deny he is an officer of

Weishave an intra-corporate controversy oneruled whichthat pertains to any of the following relationships: (1) between the corporation,  partnership or association and the public; (2) between the corporation, partnership or association and the State insofar as the former‘s franchise, permit or license to operate is concerned;(3) between the corporation, partnership or association and its stockholders, partners, members or officers; and (4) among the stockholders, partners or associates themselves. In Lozon v. National Labor Relations Commission,we declared that Presidential Decree No. 902-A confers on the SEC original and exclusive  jurisdiction to hear and decide decide controversies and cases involving intra-corporate and partnership relations between or among the corporation, officers and stockholders and partners, including their elections or appointments …xxx…  …xxx…  Before a dismissal or removal could  properly fall within the jurisdiction jurisdiction of the SEC, it has to be first established that the person removed or dismissed was a corporate officer. ―Corporate officers‖ in the context of Presidential Decree No. 902-Aare those officers of the corporation who are given that character by the Corporation Code or by the corporation‘s by-laws. by-laws. There are three specific officers whom a corporation must have under Section 25 of the Corporation Code. These are the president, president, secretary and the the treasurer. The number of officers officers is not limited to these three. A corporation may have such other officers as may be provided for by its bylaws like, but not limited to, the vice-president, UNIVERSITY OF SAN CARLOS SCHOOL OF LAW AND GOVERNANCE

ETPI. NotArbiter being ahas corporate officer, that the Labor jurisdiction jurisdiction overhe theargues case. One of the corporate officers provided for in the by-laws of ETPI is the Vice-President. It can be gathered from Atty. Garcia‘s complaint-affidavit complaint -affidavit that he was Vice President for Business Support Services and Human Resource Departments of ETPI when his employment was terminated effective 16 April 2000. It is therefore therefore clear from the by-laws by-laws and from Atty. Garcia himself that he is a corporate officer. One who is included in the by-laws of a corporation in its roster of corporate officers is an officer of said corporation and not a mere employee. Being a corporate officer, his removal is deemed to be an intra-corporate dispute cognizable  by the SEC and not by the Labor Arbiter. Arbiter. We agree with both the NLRC and the Court of Appeals that Atty. Garcia‘s ouster as ViceVice President, who is a corporate officer of ETPI,  partakes of the nature of an intra-corporate controversy, jurisdiction over which is vested in the SEC (now the RTC). The Labor Arbiter thus erred in assuming jurisdiction over the case filed by Atty. Garcia, because he had no jurisdiction over the subject matter of the controversy.

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12.)HALAGUEÑA vs. PHILIPPINE AIRLINES INCORPORATED G.R. No. 172013 October 2, 2009

Facts: Petitioners were employed as female flight attendants of respondent Philippine Airlines (PAL) on different dates prior to November 22, 1996. They are members of the Flight Attendants and Stewards Association of the Philippines  (FASAP), a labor organization certified as the sole and exclusive certified bargaining representative of the flight attendants, flight stewards and pursers of respondent. On July 11, 2001, respondent and FASAP entered into a Collective Bargaining Agreement [3] incorporating the terms and conditions of their agreement for the years 2000 to 2005, hereinafter referred to as PAL-FASAP CBA. The controversy of this petition is the the constitutionality constitutional ity of Section 144, Part A of their PAL-FASAP CBA, it provides that:  Cabin bin Attendants hir ed befor befor e 22 ― A. F or th e Ca November 1996  :

3.

Compul sory Re Reti ti rement   

(RTC) of Makati City against respondent for the invalidity of Section 144, Part A of the PAL-FASAP CBA. Respondent questioned the the jurisdiction jurisdiction of the RTC as the case make out a labor dispute arising from employer-employee employer-empl oyee relationship . On August 9, 2004, the RTC issued an Order upholding its jurisdiction over the present case. The RTC reasoned that the instant case, the thrust of the Petition is Sec. 144 of the subject CBA which is allegedly discriminatory as it discriminates against female flight attendants, in violation of the Constitution, the Labor Code, and the CEDAW. The allegations in the Petition do not make out a labor dispute arising from employer-employee relationship as none is shown to exist. Aggrieved, respondent, on October 8, 2004 appealed the case to the CA praying that the order of the RTC, which denied its objection to its jurisdiction, be annuled and set aside for having been issued without and/or with grave abuse of discretion amounting to lack of jurisdiction. The CA rendered a Decision, dated August 31, 2005, granting the respondent's petition, and ruled that the lower court is by us declared to have NO JURISDICTION OVER THE CASE. Hence, this petition. Issue:

Subject to the grooming standards  provisions of this Agreement, compulsory retir ement s shall hall be fi fty-f ive (55) for

. Xxxx”  Xxxx”  f emales and sixty (60) f or mal es 

Petitioners and several female cabin crews challenged the aforementioned CBA provision on compulsory retirement averring that the provision is discriminatory, and demanded for an equal treatment with their male counterparts. On July 29, 2004, petitioners filed a Special Civil Action for Declaratory Relief with Prayer for the Issuance of Temporary Restraining Order and Writ of Preliminary Injunction with the Regional Trial Court UNIVERSITY OF SAN CARLOS SCHOOL OF LAW AND GOVERNANCE

The main issue thispetitioners' case is whether RTC has  jurisdiction overinthe actionthe challenging the legality or constitutionality of the provisions on the compulsory retirement age contained in the CBA  between respondent respondent PAL and FASAP. FASAP.

Ruling: The petition is meritorious. meritorious. Jurisdiction of the court is determined on the basis of the material allegations  of the complaint and the character of the relief prayed for  irrespective of whether plaintiff is entitled to such relief.

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In the case at bar, the allegations in the petition for declaratory relief plainly show that petitioners' cause of action is the annulment of Section 144, Part A of the PAL-FASAP CBA. The Supreme Court held that from the petitioners' allegations and relief prayed for in its petition it was clear that isthe issue Section raised 144, by the flight attendants whether Part women A of the PALFASAP CBA is unlawful and unconstitutional. Therefore the subject of litigation is incapable of pecuniary estimation, hence, exclusively cognizable  by the RTC, pursuant to Section 19 (1) of Batas PambansaBlg. 129, as amended. Being an ordinary civil action, the same is beyond the jurisdiction of labor tribunals. The jurisdiction of labor arbiters  and the NLRC  under Article 217 of the Labor Code is limited to disputes arising from an employer-employee relationship which can only be resolved by reference to the Labor Code, other labor statutes, or their collective bargaining agreement. Not all controversy or money claim by an employee against the employer or vice-versa is within the exclusive jurisdiction of the labor arbiter. Actions between employees and employer where the employer-employee relationship is merely incidental and the cause of action precedes from a different source of obligation  is within the exclusive jurisdiction of the regular court .

Thus, where the principal relief sought is to be resolved not by reference to the Labor Code or other labor relations statute or a collective bargaining agreement but by the general civil law, the  jurisdiction over the dispute belongs to the regular courts of justice and not to the labor arbiter and the  NLRC. Here in the instant case, the employer-employee relationship between the parties is merely incidental and the cause of action ultimately arose from different sources of obligation, i.e., the Constitution and Convention on the Elimination of All Forms of Discrimination Discrimin ation Against Women (CEDAW). The Supreme alsoarbitrators holds thatdothe machinery and Court voluntary notgrievance have the UNIVERSITY OF SAN CARLOS SCHOOL OF LAW AND GOVERNANCE

 power to determine and settle the issues at hand. They have no jurisdiction and competence to decide constitutional issues relative to the questioned compulsory retirement age . Their exercise of  jurisdiction is futile, as it is like vesting power to someone who cannot wield it. Although provides for a procedure adjustmenttheofCBA grievances, such referral for to the the grievance machinery and thereafter to voluntary arbitration would be inappropriate to the petitioners,  because the union and the management have unanimouslyagreed to the terms of the CBA and their interest is unified.   WHEREFORE, the Decision of the Court of Appeals, are hereby REVERSED and SET ASIDE .

13. Okol vs. Slimmer’s World International, et al,

G.R. No. 160146, December 11, 2009 Facts:

Respondent, Slimmers World International, International, employed petitioner Leslie Okol initially as a management trainee. She rose up the ranks to become Head Office Manager and then Director and Vice President until her dismissal. Prior to her dismissal, respondent preventively suspended Okol which arose from the seizure by the Bureau of Customs of seven Precor P recor Elliptical Machines and seven Precor Treadmills belonging to or consigned to Slimmers World. Okol received a memorandum extending her suspension until pending the outcome of the investigation on the Precor P recor equipment importation. Okol received another memorandum requiring her to explain why no disciplinary action should be taken against her. Thereafter, Okol filed her written explanation but respondents found it to be unsatisfactory.Through unsatisfactory.Through a letter signed by its president Ronald Joseph Moy, Slimmers World terminated Okol‘s employment.  employment.   Okol filed a complaint with the Arbitration branch of the NLRC against respondents for illegal suspension, illegal dismissal, unpaid commissions, damages and attorney‘s fees, with prayer for reinstatement and  payment of back wages. Respondents Respondents filed a motion motion to dismiss on the ground that NLRC had no  jurisdiction over over the subject matter matter of the the complaint, with a reservation of their right to file a Position 23

 

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Paper at the proper time. The Labor Arbiter granted the motion to dismiss ruling that Okol was the vice  president, and since it involved involved a corporate officer, officer, the dispute was an intra-corporate controversy falling outside the jurisdiction of the Arbitration branch. Okol filed an appeal with the NLRC, and it reversed and set aside the labor arbiter‘s decision, ordering orde ring the reinstatement of indemnities. Okol with payment of full back wages and other Respondents filed a Motion for Reconsideration with the NLR, contending that the relief prayed for was confined only to the question of jurisdiction j urisdiction.. However, the NLRC not only decided the case on the merits but did so in the absence of position papers from both parties. Respondents then filed an appeal with the Court of of Appeals which set aside the NLRC‘s Resolution and affirmed the Labor Arbiter‘s order. The Court of Appeals ruled that the case, being an intra-corporate dispute, falls within the jurisdiction of the regular courts pursuant to Republic Act No. was 8799.denied, Okol filed a motion for Reconsideration which hence this petition for Review on Certiorari. Issue:

WON the NLRC has jurisdiction over the illegal dismissal case filed by the petitioner Ruling:

The petition lacks merit. Petitioner insists that even as vice president, the work she performed conforms to that of an employee. Mere title or o r designation in a corporation will not, by itself, determine the existence of an employer-employ etest. mployer-employee It is the ―four -fold‖ Respondents,eeonrelationship. the other hand, maintain that petitioner was a corporate officer at the time of her dismissal. Sec 25 of the Corporation Code enumerates corporate officers as the president, secretary, treasurer and such other officers as may be provided for in the by-laws. In Tabang v. NLRC, 12 we held that an "office" is created by the charter of the corporation and the officer is elected by the directors or stockholders. On the other hand, an "employee" usually occupies no office and generally is employed not by action of the directors or stockholders but by the managing officer of the corporation who also determines the compensation to be paid to such employee.

UNIVERSITY OF SAN CARLOS SCHOOL OF LAW AND GOVERNANCE

Clearly, from the documents submitted by respondents, petitioner was a director and officer of Slimmers World. The charges of illegal suspension, illegal dismissal unpaid commissions, reinstatement and back wages imputed by petitioner against respondent falls squarely within the ambit of intracorporation disputes. It is not a simple labor problem  but a matter matter that comes within within the area of corporate affairs and management and isofa the corporate controversy in contemplation Corporation Code, subject to the jurisdiction of the regular courts. Thus the appellate court correctly ruled that it is not the NLRC but the regular courts which have  jurisdiction over over the present case.

14.) Hugo et al., vs. Light Rail Transit Authority, G.R. No. 181866, March 18, 2010 Facts:

Respondent Light Rail Transit Authority (LRTA), a government-owned and controlled corporation, constructed a light rail transit system which traverses from Baclaran in Parañaque City to Monumento in Kalookan City, Metro Manila pursuant to its mandate under its charter, Executive Order No. 603, Series of 1980, as amended. To effectively carry out its mandate, LRTA entered into a ten-year Agreement for the Management and Operation of the Metro Manila Light Rail Transit System (the Agreement) from June 8, 1984 until June 8, 1994 with Metro Transit Organization, Inc. (METRO). One of the stipulations in the Agreement was: METRO shall be free to employ such employees and officers as it shall deem necessary in order to carry out the requirements of the Agreement. Such employees and officers shall be the employees of METRO and not of LRTA. METRO shall prepare a compensation schedule for the salaries and fringe benefits of its personnel (Article 3, par. 3.05).

METRO thus hired its own employees including herein petitioners-members of the Pinag-

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isangLakasngManggagawasa METRO, Inc.-National

Federation of Labor, otherwise known as PIGLASMETRO, INC.-NFL-KMU (the Union), the certified exclusive collective bargaining representative of METRO's rank-and-file employees. When the Agreement expired on July 31, 2000, LRTA did not it. It of instead tookrail over the management andrenew operations the light transit system, hiring new personnel for the purpose. METRO thus considered the employment of all its  personnel terminated terminated effective effective September 30, 2000. 2000. Petitioners filed a complaint for illegal dismissal and unfair labor practice with prayer for reinstatement and damages against METRO and LRTA before the  NCR Arbitration Branch, National Labor Relations Commission (NLRC).

Issue:  



Whether or not the Labor Arbiter's decision against LRTA was rendered without  jurisdiction. 

Ruling:

The Labor Arbiter and the NLRC do not have  jurisdiction over LRTA. Petitioners themselves admitted in their complaint that LRTA "is a government agency organized and existing pursuant to anoriginal charter (Executive Order No. 603)," and that they are employees of METRO.  Light Rail Transit Authority v. Venus, Jr.,

which has a similar factual backdrop, holds that LRTA, being a government-owned or controlled corporation created  by an original charter, is beyond the reach of the Department of Labor and Employment which has  jurisdiction over workers in in the private sector, sector, viz : . . . [E]mployees of petitioner METRO MET RO cannot be considered as employees of  petitioner LRTA. The employees hired by METRO are covered by the Labor Code and are under the jurisdiction of the Department of Labor and Employment, whereas the employees of petitioner government-owned and

LRTA, a controlled

UNIVERSITY OF SAN CARLOS SCHOOL OF LAW AND GOVERNANCE

corporation with original charter, are covered by civil service rules. Herein private respondent workers cannot have the best of two worlds, e.g., be considered government employees of  petitioner LRTA, yet allowed to strike as  private employees under our labor laws. x

xx. x xxx . . . [I]t is inappropriate to pierce the corporate veil of petitioner METRO. x xx. In the instant case, petitioner METRO, formerly Meralco Transit Organization, Inc., was originally owned by the Manila Electric Company and registered with the Securities and than Exchange Commission more a decade  before the labor dispute. It then entered into a ten-year agreement with petitioner LRTA in 1984. And, even if petitioner LRTA eventually purchased METRO in 1989, both parties maintained their separate and distinct juridical  personality and allowed the agreement to proceed. In 1990, this Court, in Light Rail Transit  Authority v. Commission on  Audit  (G.R.   (G.R. No. 88365, January 9,

1990), even upheld the validity of the said agreement. Consequently, the agreement was extended  beyond its ten-year period. In 1995, METRO's separate juridical identity was again recognized when it entered into a collective  bargaining agreement with the workers' union. All these years, METRO's distinct corporate  personality continued quiescently, separate and apart from the  juridical personality of petitioner LRTA.

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The labor dispute only arose in 2000, after a deadlock occurred during the collective bargaining  between petitioner METRO METRO and the workers' union. This alone is not a  justification to pierce the corporate veil of petitioner METRO and make petitioner LRTA liable to  private respondent workers. There are no badges of fraud or any wrongdoing to pierce the corporate veil of petitioner METRO. x xxx In sum, petitioner LRTA cannot be held liable to the employees of petitioner METRO. IN FINE, the Labor Arbiter's decision against LRTA was rendered without jurisdiction, hence, it is void, thus rendering it improper for the remand of the case to the NLRC, as ordered by the appellate court, for it (NLRC) to give due course to LRTA's appeal. A final word. It bears emphasis that this Court's  present Decision treats treats only with respect to the Labor Arbiter's decision against respondent LRTA.

15. Matling Industrial Corporation vs. Coros

This is a petition for certiorari assailing the decisionin entitled Matling Industrial and

review on the case

Commercial Corporation, et al. v. Ricardo R. Coros and National  Labor Relations Commission, whereby by the Court

of Appeals (CA) sustained the ruling of the National Labor Relations Commission (NLRC) to the effect that the LA had jurisdiction because the respondent was not a corporate officer of petitioner Matling Industrial and Commercial Corporation (Matling). FACTS: Respondent, Vice-President for Finance and Administration of Matling was dismissed, thus, he filed a complaint for illegal suspension and illegal dismissal against Matling and some of its corporate officers (petitioners) in the NLRC, Sub-Regional Arbitration Branch XII, Iligan City. UNIVERSITY OF SAN CARLOS SCHOOL OF LAW AND GOVERNANCE

The petitioners moved to dismiss the complaint   contending that the complaint pertained to the  jurisdiction of the Securities and Exchange Commission (SEC) due to the controversy being intra-corporate inasmuch as the respondent was a member of Matling‘s Board of Directors aside from  being its Vice-President for Finance and Administration prior to his termination. Administration The respondent opposed the petitioners‘  petitioners‘ motion to dismiss, insisting that his status as a member of Matling‘s Board of Directors was doubtful, considering that he had not been formally elected as such; that he did not own a single share of stock in Matling, considering that he had been made to sign in  blank an undated indorsement of the certificate of stock he had been given in 1992; that Matling had taken back and retained the certificate of stock in its custody; and that even assuming that he had been a Director of Matling, he had been removed as the Vice President for Finance and Administration, not as a Director, a fact that the notice of his termination dated April 10, 2000 showed. The petitioners‘  petitioners‘ motion to dismiss was granted by the Labor Arbiter ruling that the respondent was a corporate officer because he was occupying the  position of Vice President for Finance and Administration and at the same time was a Member of the Board of Directors of Matling; and that his removal was a corporate act of Matling and the controversy resulting from such removal was under the jurisdiction of the SEC, pursuant to Section 5,  paragraph (c) of Presidential Decree Decree No. 902. Respondent appealed appealed to the NLRC, which which set aside the dismissal, concluding that the respondent‘s  complaint  for illegal dismissal was respondent‘s  properly cognizable by the LA, not by the SEC,  because he was not a corporate officer by virtue of his position in Matling, albeit high ranking and managerial, not being among the positions listed in Matling‘s Constitution and By-Laws. By-Laws. The petitioners sought reconsideration reiterating that the respondent, being a member of the Board of Directors, was a corporate officer whose removal was not within the LA‘s  jurisdiction.  Nonetheless, on April April 30, 2001, the NLRC denied denied the  petitioners‘ motion for reconsideration.  petitioners‘  Thus, the petitioners elevated the issue to the CA by petition for certiorari, contending that the 26

 

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 NLRC committed grave abuse of discretion amounting to lack of jurisdiction in reversing the correct decision of the LA. The CA dismissed the  petition contending contending that: The position of vice-president for administration and finance, which Coros used to hold in the corporation, was not created by the the corporation‘s board of directors but only by or the executive vice president pursuant to its thepresident by-laws b y-laws of corporation. Moreover, Coros‘ appointment to said position was not made through any act of the board of directors or stockholders of the corporation. Consequently, the  position to which Coros was appointed and later on removed from, is not a corporate office despite its nomenclature, but an ordinary office in the corporation.

the controversy involves the election or appointment of a director, trustee, officer, or manager of such corporation, partnership, partnership, or association. Such controversy, among others, is known as an intracorporate dispute. The petitioners contend that the position of Vice President for Finance and Administration was a corporate office, having beenNo. created President pursuant to By-Law V. by Matling‘s The respondent counters that Matling‘s ByByLaws did not list his position as Vice President for Finance and Administration as one of the corporate offices; that Matling‘s By-Law By-Law No. III listed only four corporate officers, namely: President, Executive Vice President, Secretary, and Treasurer; that the corporate offices contemplated in the phrase ― and

Coros‘ alleged illegal dismissal therefrom is, therefore, within the jurisdiction of the labor arbiter.

 such other officers as may be provided for in tthe he by laws‖ found in Section 25 of the  the Corporation Code  should be clearly and expressly stated in the

The

By-Laws; that the fact that Matling‘s By-Law By-Laws; By-Law No. III Offi cers while its By-Law No. dealt with Directors & Officers

CA

denied the petitioners‘  petitioners‘ motion reconsideration on April 2, 2003.

for

ISSUES: Whether or not respondent Coros was a corporate officer of Matling Whether or not the Labort Arbiter has  jurisdiction over the case RULING: First Issue As a rule, the illegal dismissal of an officer or other employee of a private employer is properly cognizable by the LA. This is provided for in Article 217 (a) 2 of the Labor Code.  Where the complaint  for illegal dismissal concerns a corporate officer, however, the controversy falls under the jurisdiction of the Securities and Exchange Commission (SEC), because the controversy arises out of intra-corporate or  partnership relations between and among stockholders, members, or associates, or between any or all of them and the corporation, partnership, or association of which they are stockholders, members, or associates, respectively; and between such corporation, partnership, or association and the State insofar as the controversy concerns their individual franchise or right to exist as such entity; or because UNIVERSITY OF SAN CARLOS SCHOOL OF LAW AND GOVERNANCE

Officers the V dealt withbetween proved thatmentioned there was differentiation officers in thea two provisions, with those classified under By-Law  No. V being ordinary or non-corporate officers; and that the officer, to be considered as a corporate officer, must be elected by the Board of Directors or the stockholders, for the President could only appoint an employee to a position pursuant to By-Law No. V.

The court favors the respondents contention. Section 25 of the Corporation Code provides that a  position must be expressly expressly mentioned in the the By-Laws in order to be considered as a corporate office. Thus, the creation of an office pursuant to or under a ByLaw enabling provision is not enough to make a  position a corporate office. Moreover, Moreover, the Board of Directors of Matling could not validly delegate the  power to create a corporate office to the President, in light of Section 25 of the Corporation Code requiring the Board of Directors itself to elect the corporate officers. Verily, the power to elect the corporate officers was a discretionary power that the law exclusively vested in the Board of Directors, and could not be delegated to subordinate officers or agents. The office of Vice President President for Finance and Administration created by Matling‘s President  pursuant to By Law No. V was an ordinary, not a corporate, office. The power to create new offices and the power to appoint the officers to occupy them vested by ByLaw No. V merely allowed Matling‘s President to create non-corporate offices to be occupied by 27

 

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ordinary employees of Matling. Such powers were incidental to the President‘s duties as the executive head of Matling to assist him in the daily operations of the business. Second Issue Petitioners further content that because the respondent of Matling, the was NLRC a hadDirector/stockholder no jurisdiction over his complaint , considering that any case for illegal dismissal brought by a stockholder/officer stockholder/officer against the corporation was an intra-corporate matter that must fall under the jurisdiction of the SEC conformably with the context of PD No. 902-A. This contention also has no merit. The criteria for distinguishing between corporate officers who may be ousted from office at will, on one hand, and ordinary corporate employees who may only be terminated for just cause, on the other hand, do not depend on the nature of the services performed, on the mannercase, of creation of the office. In the butrespondent‘s he was supposedly at once an employee, a stockholder, and a Director of Matling. The circumstances surrounding his appointment to office must be fully considered to determine whether the dismissal constituted an intracorporate controversy or a labor termination dispute. We must also consider whether his status as Director and stockholder had any relation at all to his appointment and subsequent dismissal as Vice President for Finance and Administrat Administration. ion. The respondent was not appointed as Vice President for Finance and Administration because of his being a stockholder or Director of Matling. He had started working for Matling on September 8, 1966, and had been employed continuously for 33 years until his termination on April 17, 2000, first as a bookkeeper, and his climb in 1987 to his last  position as Vice President for Finance and Administration Administra tion had been gradual but steady.

WHEREFORE, the on certiorari is denied.

petition for

review

16.) Manila Electric Co. et al., vs. Lim, GR No. 184769, Oct. 5, 201056.

Facts: Rosario G. Lim (respondent), also known as Cherry Lim, is an administrative clerk at the Manila Electric Company (MERALCO). Her workplace received threats through letter and it was directed to her, thus the human resource in her workplace directed her transfer to other other branch. branch. From bulacan she was was transferred to muntinlupa. Respondent appealed the transfer through letter, she requested for voice dialogue with the head of HR administration. She wanted to voice out her concerns on the matter of her transfer and that there was no due process when the direct order was issued, and the grueling effort to travel from her home to the place where she was transferred were not considered and also it violates the CBA with regards to the job security, and she also expressed her thoughts on the letter, for her the letter was suspicious, doubtful or  just mere jokes jokes if the letter letter ever existed. existed. She received no response from the company, thus she filed a petition for habeas data, in RTC of bulacan. Where she got a favorable decision, The trial court  justified its ruling by declaring that, inter alia, recourse to a writ of habeas data should extend not only to victims of extra-legal killings and political activists but also to ordinary citizens, like respondent whose rights to life and security are jeopardized by  petitioners‘ refusal refusal to provide her with information information or data on the reported threats to her person.. Thus, this petition for review in Supreme S upreme Court.

Even though he might have become a stockholder of Matling in 1992, his promotion to the  position of Vice President for Finance and Administration Administra tion in 1987 was by virtue of the length of quality service he had rendered as an employee of Matling. His subsequent acquisition of the status of Director/stockholder had no relation to his  promotion. Besides, his status of Director/stoc Director/stockholder kholder was unaffected by his dismissal from employment as Vice President for Finance and Administration. Administration.

 No, the habeas data rule, in general, is designed to  protect by means of judicial complaint the image,

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Issue: Whether or not, writ of habeas data is applicable in the case at bar. Ruling:

 

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 privacy, honor, information, and freedom of information of an individual. It is meant to provide a forum to enforce one‘s right to the truth and to informational privacy, thus safeguarding the constitutional guarantees of a person‘s right to life, liberty and security against abuse in this age of information technology. Respondent‘s plea that she be spared from complying with MERALCO‘s Memorandum directing her reassignment to the Alabang Sector, under the guise of a quest for information or data allegedly in  possession of petitioners, does not fall within the  province of a writ of habeas data.Respondent trivializes these threats and accusations from unknown individuals in her earlier-quoted portion of her July 10, 2008 letter as ―highly suspicious, doubtful or are just mere jokes if they existed at all.‖ all.‖   18.) Real vs. Sangu Phils., Inc., et al., G.R. No. 168757, January 19, 2011 Facts:

Renato Real was the Manager of respondent corporation Sangu Philippines. Heclaimed to have been illegaly dismissed through Board Resolution 2001-

Manager, he committed gross acts of misconduct detrimental to the company since 2000. He was almost always absent, and neglected to supervise the employees resulting in complaints from various clients about employees‘ perf ormance. ormance. The Labor Arbiter (2003)found no convincing  pr  proo ooff of th thee cau cause sess for for whi hich ch pet petit itio ione nerr was was te term rmin inat ated ed and and noted that there was complete absence of due process in the manner of his termination. It declared petitioner as having  beenn ill  bee illeg egal ally ly di dism smis isse sedd and and or orde dere redd ffor or hi hiss rei reins nsta tatm tmen entt to to hisformer positions without loss of seniority rights and other privileges and to pay their full backwages from the time of dismissal until actually reinstated, plus attorney‘s fees. On appeal, the NLRC dismissed the pe the peti titi tion oner er‘s ‘s complaint established petitioner‘s status as a stockholder and as a corporate officer and hence, his action against respondent corporation is an intra-corporate controversy over which the Labor Arbiter has no jurisdiction.

03adopted by respondentcorporation‘s Board of Directors removing him from his position as manager. manager. Petitioner complained that he was neither notified of the Board

Issues: 

Meeting during which said board resolution was passed nor formally charged with with any infraction. infraction. He just received from respondents a letterdated March 26, 2001 stating that

Whether or not petitioner‘s complaint for illegal dismissal

he has been terminated from service effective March 25,

constitutes an intra-corporate controversy and thus, beyond

2001 for the following reasons: (1) continuous absences at

the jurisdiction of the Labor Arbiter.

his post at Ogino Philippines Inc. for several months which was detrimental detrimental to the corporation‘s operation; (2) loss of trust and confidence; and, (3) to cut down operational expenses to reduce further losses being experienced by

Ruling:   No in intr tra-c a-cor orpor porate ate relat relatio ions nshi hip pb betw etwee een n tthe he pa parti rties es..

respondent corporation. Respondentsrefuted petitioner‘s claim of illegal

[A]n intra-corporate controversy is one which arises between a stockholder and

dismissal by alleging that after petitioner was appointed

the corporation. There is no distinction, distinction, qualification nor any exemption

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whatsoever. The provision is broad and covers all kinds of controversies  betwe  bet ween en stock stockho hold lder erss and and corp corpor orat atio ions ns..

However, the better policy in determining whether a dispute is intra-corporate or not is to consider consider concu concurr rent ffactors actors s such uch as the status status or rrelation elationship ship of the parti es or th the e natur e o off the que ques stion that i s subject of the th eir controversy  .

Two-tier test in determining the existence of intracorporate controversy 

Under the nature of the controversy test, the incidents of that relationship must also be considered for the purpose of ascertaining whether the controversy itself is intra-corporate. The controversy must not only be rooted in the existence of an intracorporate relationship, but must as well  pert  pertai ainn to th thee enfo enforc rcem emen entt of th thee  part  partie ies‘ s‘ corr correl elat ativ ivee ri righ ghts ts and and obligations under the Corporation Code and the internal and intra-corporate regulatory rules rules of the corporation. corporation. If the relationship and its incidents are merely incidental to the controversy or if there will still be conflict even if the relationship does not exist, then no intra-corporate controversy exists.

The Court then combined the two tests and declared that jurisdiction should be determined by considering not only the status or relationship of the  part  partie ies, s, bu butt al also so th thee na natu ture re of th thee question under controversy.

‗To determine whether a case involves an intra-corporate controversy, and is to be heard and decided by the branches of the RTC specifically designated by the Court to try and decide such cases, two elements must concur: (a) the status or relationship of the  part  partie ies, s, and and (2) the the natur naturee of the question that is the subject of their controversy.

The first element requires that the controversy must arise out of intracorporate or partnership relations between any or all of the parties and the corporation, partnership, or association of which they are not stockholders, members or associates, between any or all of them and the corporation,  part  partne ners rshi hipp or associ associat atio ionn of which they are stockholders, members or associates, respectively; and between such corporation, partnership, or association and the State insofar as it concerns the individual franchises. The second element requires that the dispute among the parties  be in intr trin insi sica call llyy conne connect cted ed with the regulation of the corporation. If the nature of the controversy involves matters that are purely civil in character, necessarily, the case does not involve an intra-corporate intracorporate controversy.‘ [Citations omitted.] There is no merit in respondents‘ contention that the fact alone that petitioner is a stockholder and director of

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respondent corporation automatically classifies this case as an intra-corporate controversy.

RULING:

To reiterate, reiterate, not all

conflicts between the stockholders and the corporation are classified as intra-corporate. There are other other factors to consider in determining whether the dispute involves corporate matters as to consider them as intra-corporate controversies.

To determine whether a case involves an intracorporate controversy, and is to be heard and decided  by the branches of the RTC specifically designated  by the Court to try and decide such cases, two elements must concur: (a) the status or relationship of the parties, and (2) the nature of the question that is the subject of their controversy.

18.  RENATO REAL, Petitioner, vs. SANGU PHILIPPINES, INC. and/ or KIICHI ABE, Respondents. [G.R. No. 168757, January 19, 2011]

DEL CASTILLO, J.: FACTS:

Renato Real was the Manager of respondent corporation Sangu Philippines, Inc. which is engaged in the business of providing manpower for general services. He filed a complaint for illegal dismissal against the respondents stating that he was neither notified of the Board meeting during which his removal was discussed nor was he formally charged with any infraction.

Respondents, on the other hand, said that Real committed gross acts of misconduct detrimental to the company since 2000. The LA declared petitioner as having been illegally dismissed. Sangu appealed to  NLRC  NLRC and established petitioner‘s status as a stockholder and as a corporate officer and hence, his action against respondent corporation is an intracorporate controversy over which the Labor Arbiter has no jurisdiction. NLRC modified the LA‘s decision. On appeal, the CA affirmed the decision of  NLRC. Hence, this petition.

ISSUE: WON petitioner‘s complaint for illegal dismissal constitutes an intra-corporate controversy.

The first element requires that the controversy must arise out of intra-corporate or partnership relations  between any or all of the parties and the corporation x x . The second element requires that the dispute among the parties be intrinsically connected with the regulation of the corporation. If the nature of the controversy involves matters that are purely civil in character, necessarily, the case does not involve an intra-corporate controversy.

Guided by this recent jurisprudence, we thus find no merit in respondents‘ contention that the fact alone that petitioner is a stockholder and director of respondent corporation automatically classifies this case as an intra-corporate controversy. To reiterate, not all conflicts between the stockholders and the corporation are classified as intra-corporate. There are other factors to consider in determining whether the dispute involves corporate matters as to consider them as intra-corporate controversies.

19. PORTILLO VS. RUDOLF LIETZ, INC. ET AL. G.R. NO. 196539, OCTOBER 10, 2012

Petition for certiorari assailing the Resolutionll dated 14 October 2010 of the Court of Appeals in CA-G.R. SP No. I 065g I which modified its Decisionl dated 31 March 2009, thus allowing the legal compensation co mpensation or petitioner Marietta N. Portillo's (Portillo) monetary claims against respondent corporation Rudolf Lietz, Inc.'s (Lietz Inc.)ςrνll claim for liquidated damages arising from Portillos alleged violation of the "Goodwill executed by Clause" the parties.in the employment contract

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Facts In a letter agreement dated 3 May 1991, signed by individual respondent Rudolf Lietz (Rudolf) and conformed to by Portillo, the latter was hired by the former under the following terms and conditions:

A copy of [Lietz Inc.s] work rules and policies on personnel is enclosed and an inherent part of the terms and conditions of employment.

We acknowledge your proposal in your application specifically to the effect that you will not engage in any other gainful employment by yourself or with any other company either directly or indirectly without written consent of [Lietz Inc.], and we hereby accept and henceforth consider your  proposal an undertaking on your part, a  breach of which will render you liable to [Lietz Inc.] for liquidated damages. da mages. On her tenth year with Lietz Inc., specifically on 1 February 2002, Portillo was  promoted to Sales Representative and received a corresponding increase in basic monthly salary and sales quota. In this regard, Portillo signed another letter agreement containing a "Goodwill Clause:" Three years thereafter, on 6 June 2005, Portillo resigned from Lietz Inc. During her exit interview, Portillo declared that she intended to engage in businessa rice dealership, selling rice in wholesale. On 15 June 2005, Lietz Inc. accepted Portillos resignation and reminded her of the "Goodwill Clause" in the last letter agreement she had signed. Upon receipt thereof, Portillo jotted a note thereon that the latest contract she had signed in February 2004 did not contain any "Goodwill Clause" referred to by Lietz Inc. In response thereto, Lietz Inc. categorically wrote Please be informed that the standard  prescription of prohibiting employees from engaging in business or seeking employment with organizations that directly or indirectly compete against [Lietz Inc.] for three (3) years after resignation remains in effect. e ffect. Subsequently, Lietz Inc. learned that Portillo had been hired by Ed Keller Philippines, Limited to head its Pharma Raw Material Department. Ed Keller Limited is purportedly a direct competitor of Lietz Inc.

UNIVERSITY OF SAN CARLOS SCHOOL OF LAW AND GOVERNANCE

14 September 2005, Portillo filed a complaint with the National Labor Relations Commission (NLRC) for non-payment of 1 months salary two (2) months commission, 13th month pay,  plus moral, exemplary and actual damages and attorney‘s fees. In its position paper, Lietz Inc. admitted liability for Portillos money claims in the total amount of P110,662.16. However, Lietz Inc. raised the defense of legal compensation: Portillos money claims should be offset against her liability to Lietz Inc. for liquidated damages in the amount of ₱869,633.09l for Portillos alleged breach of the "Goodwill Clause" in the employment contract when she became employed with Ed Keller Philippines, Limited. On 25 May 2007, Labor Arbiter granted Portillos complaint ordering respondents Rudolf Lietz, Inc. to pay complainant Marietta N. Portillo the amount of Php110,662.16 representing her salary and commissions, including 13th month pay.‚rνll  pay.‚rνll  Lietz Inc. filed a petition for certiorari  before the Court of Appeals, alleging grave abuse of discretion in the labor tribunal‘s rulings. The CA initially affirmed the labor tribunals, but on motion for reconsideration, modified its previous decision. While upholding the monetary award in favor of Portillo in the aggregate sum P110, 662.16, the CA allowed legal compensation or set-off of such award of monetary claims by her liability to Lietz Inc. for liquidated damages arising from her violation of the ―Goodwill Clause‖ in her employment contract contra ct with them. denied. Portillo‘s Hence, thismotion petitionforfor reconsideration certiorari before was the SC.

Issue Whether Portillo‘s money claimes for unpaid salaries may be offset against Lietz Inc.‘s claim for liquidated damages

Ruling Paragraph 4 of Article 217 of the Labor 32

 

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Code appears to have caused the reliance by the Court of Appeals on the "causal connection between Portillo‘s monetary claims against respondents and the latter‘s claim from liquidated damages against the former." Art. 217. Jurisdiction of Labor Arbiters and the Commission.

(a) Except as otherwise provided under this code, the Arbiters shall have original and exclusive jurisdiction to hear and decide, within thirty (30) calendar days after the submission of the case by the parties for decision without extension, even in the absence of stenographic notes, the following case involving all workers, whether agricultural or nonagricultural 4. Claims for actual, moral, exemplary and other forms of damages arising from the employer-employee employer-empl oyee relations; (Underscoring supplied) Evidently, the Court of Appeals is convinced that thetheclaim for liquidated emanates from "Goodwill Clause damages of the employment contract and, therefore, is a claim for damages arising from the employeremployee relations. Singapore Airlines Limited v. Pa ,

we established that not all disputes between an employer and his employee(s) fall within the jurisdiction of the labor tribunals. We differentiated between abandonment  per se and the manner and consequent effects of such abandonment and ruled that the first, is a labor case, while the second, is a civil law case. Stated differently, petitioner seeks protection under the civil laws and claims no benefitsisunder the Labor damages Code. Thefor primary sought for liquidated breachrelief of a contractual obligation. The other items demanded are not labor benefits demanded by workers generally taken cognizance of in labor disputes, such as payment of wages, overtime compensation or separation pay. The items claimed are the natural consequences flowing from breach of an obligation, intrinsically a civil dispute.  The Court, therefore, believes and so holds that the "money claims of workers" referred to in paragraph 3 of Article 217 embraces money claims which arise out of or in connection with the employer-employee relationship, or some aspect or incident of such

original and exclusive jurisdiction of Labor Arbiters are those money claims which have some reasonable causal connection with the employeremployee relationship. 

In  Dai-Chi

Electronics Manufacturing Corporation v. Villarama, Jr. ,νwhich reiterated the San Miguel ruling and allied jurisprudence, we

 pronounced that a non-compete clause, as in the "Goodwill Clause" referred to in the present case, with a stipulation that a violation thereof makes the employee liable to his former employer for liquidated damages, refers to post-employment relations of the  parties That the "Goodwill Clause" in this case is likewise a postemployment issue should brook no argument. There is no dispute as to the cessation of Portillos employment with Lietz Inc. She simply claims her unpaid salaries and commissions, which Lietz Inc. does not contest. At that juncture, Portillo was no longer an employee of Lietz Inc. The "Goodwill Clause" or the "Non-Compete Clause" is a contractual undertaking effective after the cessation of the employment relationship between the parties. In accordance with jurisprudence, breach of the undertaking is a civil law dispute, not a labor law case. It is clear, therefore, that while Portillos claim for unpaid salaries is a money claim that arises out of or in connection with an employer-employee relationship, Lietz Inc.s claim against Portillo for violation of the goodwill clause is a money claim  based on an act done after the cessation of the employment relationship. And, while the jurisdiction over Portillos claim is vested in the labor arbiter, the  jurisdiction over Lietz Inc.s Inc.s claim rests on the regular courts. Thus:

As it is, petitioner does not ask for any relief under the Labor Code. It merely seeks to recover damages based on the  parties' contract of employment as redress for respondent's breach thereof. Such cause of action is within the realm of Civil Law, and jurisdiction over the controversy  belongs to the regular courts. More so must this be in the present case, what with the reality that the stipulation refers to the  postemployment  postemployme nt relations of the parties.

The Court of Appeals was misguided. Its conclusion was incorrect.

relationship. Put a little money claims of workers whichdifferently, now fall that within the

is no claim causalfor connection between  petitionerThere employees unpaid wages and the the

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respondent employers claim for damages for the alleged "Goodwill Clause" violation. Portillos claim for unpaid salaries did not have anything to do with her alleged violation of the employment contract as, in fact, her separation from employment is not "rooted" in the alleged contractual violation. She resigned from her employment. She was not dismissed. Portillos entitlement to the unpaid u npaid salaries is not even contested. Indeed, Lietz Inc.s argument about legal compensation necessarily admits that it owes the money claimed by Portillo. Indeed, the application of compensation in this case is effectively barred by Article 113 of the Labor Code which prohibits wage deductions except in three circumstances: ART. 113. Wage Deduction. No employer, in his own behalf or in behalf of any person, shall make any deduction from wages of his employees, except:chanroblesvirtuallawlibrary (a) In cases where the worker is insured with his consent by the employer, and the deduction is to recompense the employer for the amount paid by him as premium on the insurance; (b) For union dues, in cases where the right of the worker or his union to check-off has  been recognized by the employer or authorized in writing by the individual worker concerned; and (c) In cases where the employer is authorized by law or regulations issued by the Secretary of Labor. WHEREFORE, the petition is GRANTED.  20.)G.R. No. 197309: October 10, 2012 ACE NAVIGATION CO., INC., VELA INTERNATIONAL MARINE LTD., and/or RODOLFO PAMINTUAN, Petitioners  Petitioners, v. TEODORICO FERNANDEZ, assisted by GLENITA FERNANDEZ, Respondent   Respondent .

damages, plus attorneys fees, against 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 the dispute. 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  POEA-SEC ), Contract ( POEA-SEC  ), since the parties are covered  by the AMOSUP-TCC or AMOSUP-V AMOSUP-VELA ELA collective bargaining agreement (CB A ). Under Section 14 of the CBA, a dispute between a seafarer and the company shall be settled through the grievance machinery and mandatory voluntary arbitration. Fernandez opposed the motion. He argued that inasmuch as his complaint involves a money claim, original and exclusive jurisdiction over the case is vested with the labor arbiter. The Compulsory Arbitration Rulings On December 9, 2008, Labor Arbiter Romelita N. Rioflorido denied the motion to dismiss, holding that under Section 10 of Republic Act ( R.A.)  No. 8042, the Migrant Workers and Overseas Filipinos Act of 1995, the labor arbiter has original and exclusive jurisdiction over money claims arising out of an employer-employee relationship or by virtue of any law or contract, notwithstanding any  provision of law law to the contrary. contrary. The petitioners appealed to the NLRC, but the labor agency denied the appeal. It agreed with the labor arbiterthethatjurisdiction the case involves moneyarbiter, claim and is within of thea labor in accordance with Section 10 of R.A. No. 8042. Additionally,, it declared that the denial of the motion Additionally to dismiss is an interlocutory order which is not appealable. Accordingly, it remanded the case to the labor arbiter for further proceedings. The petitioners moved for reconsideration, but the NLRC denied 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.

Facts: Issues:

On October 9, 2008, seaman Teodorico  Fernandez ), Fernandez ( Fernandez  ), assisted by his wife, Glenita

Whether or not

the challenge to the labor

Fernandez, with) the  NLRC  disability Commissionfiled ( NLRC  a National complaintLabor for Relations benefits  , with prayer for moral and exemplary

arbiter‘s theirismotion to dismiss by way of of an appealdenial to the of NLRC proper?(negative)

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Ruling:

 No appeal from an interlocutory order shall  be entertained. To discourage frivolous or dilatory appeals, including those taken from interlocutory orders, the Commission may censure or cite in contempt the erring parties and their counsels, or subject them to reasonable fine or penalty. In Indiana Aerospace University v. Comm. on Higher Educ.,ll the Court declared that "[a]n order denying a motion to dismiss is interlocutory"; the  proper remedy in this situation is to appeal after a decision has been rendered. Clearly, the denial of the  petitioner‘s motion motion to dismiss in the present case was an interlocutory order and, therefore, not subject to appeal.

the interpretation or implementation of their Collective Bargaining Agreement and those arising from the interpretation or enforcement of company  personnel policies. policies. Article 261  of the Labor Code (Jurisdiction of Voluntary Arbitrators or panel of Voluntary Arbitrators):

The Voluntary Arbitrator or panel of Voluntary Arbitrators shall have original and exclusive jurisdiction to hear and decide all unresolved grievances arising from the interpretation or implementation of the Collective Bargaining Agreement and those arising from the interpretation or enforcement of company personnel policies. Article 262  of the Labor Code (Jurisdiction over other labor disputes) declares:

The Voluntary Arbitrator or panel of Voluntary Arbitrators, upon agreement of the parties, Issues: 

Who has the original and exclusive  jurisdiction over Fernandez disability claim the labor arbiter under Section 10 of R.A. No. 8042, or the voluntary arbitration mechanism as prescribed in the  parties CBA and the POEA-SEC?(latter) POEA-SEC?(latter) Ruling:

The answer lies in the States labor relations  policy laid down in the Constitution and fleshed out in the enabling statute, the Labor Code. Section 3, Article XIII (on Social Justice and Human Rights) of the Constitution declares: The State shall promote the principle of shared responsibility between workers and employers and the preferential use of voluntary modes in settling disputes, including conciliation, and shall enforce their mutual compliance therewith to foster industrial peace. Article 260 of the Labor Code (Grievance machinery and voluntary arbitration) states:

shall also hear decide all otherand laborbargaining disputes including unfairandlabor practices deadlocks. Further, the POEA-SEC, which governs the employment of Filipino seafarers, provides in its Section 29 on Dispute Settlement procedure: In cases of claims and disputes arising from this employment, the parties covered by a collective bargaining agreement shall submit the claim or dispute to the original and exclusive jurisdiction of the voluntary arbitrator or panel of voluntary arbitrators. If the parties are not covered by a collective bargaining agreement, the parties may at

their option the claim or dispute to either the original andsubmit exclusive jurisdiction of the National Labor Relations Commission (NLRC), pursuant to Republic Act (RA) 8042 otherwise known as the Migrant Workers and Overseas Filipinos Act of 1995 or to the original and exclusive jurisdiction of the voluntary arbitrator or panel of voluntary arbitrators. If there is no provision as to the voluntary arbitrators to be appointed by the parties, the same shall be appointed from the accredited voluntary arbitrators of the National Conciliation and Mediation Board of the Department of Labor and Employment.

The parties to a Collective Bargaining Agreement shall include therein provisions that will ensure the mutual observance of its terms and

Under the above-quoted constitutional and legal provisions, the voluntary arbitrator or panel

conditions. and Theyresolution shall establish machinery forfrom the adjustment of grievances arising

of voluntary arbitrators has original and exclusive  jurisdiction over Fernandezs disability claim.

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There is no dispute that the claim arose out of Fernandezs employment with the petitioners and that their relationship is covered by a CBA the AMOSUP/TCC or the AMOSUP-VELA CBA. The CBA provides for a grievance procedure for the resolution of grievances or disputes which occur during the employment relationship and, like the grievance machinery created under Article 261 of the Labor Code, it is a two-tiered mechanism, with voluntary arbitration as the last step. Consistent with this finding, Fernandezs contention that his complaint for disability benefits is a money claim that falls within the original and exclusive jurisdiction of the labor arbiter under Section 10 of R.A. No. 8042 is untenable. We likewise reject his argument that he never referred his claim to the grievance machinery (so that no unresolved grievance exists as required under Article 261 of the Labor Code), and that the parties to the case are not the union and the employer.ll Needless to state, no such distinction exists in the parties CBA and the POEA-SEC. It bears stressing at this point that we are upholding 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, importantly, we so uphold the voluntary arbitrators 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 a dispute to voluntary arbitration then that procedure should be strictly observed.

its incorporators was Cosare, having been assigned 100 shares of stock. In October 2001, Cosare was promoted to the  position of Assistant Vice President for Sales and Head of the Technical Coordination. In 2009, however, Cosare was asked to tender his resignation in exchange for ―financial ―financial assistance‖ assistance‖ in t h e a m o u n t o f ₱300,000.00. He refused to comply with the directive. Thereafter, Cosare received a memo charging him of serious misconduct and willful breach of trust and was, thus, suspended from having access to any and all company files/records and use of company assets. He was likewise barred from entering the company  premises and prevented from retrieving his personal  belongings. Aggrieved, Cosare filed a labor complaint against Broadcom claiming that he was constructively dismissed from his employment. The Labor Arbiter dismissed the complaint on the ground that Cosare failed to establish that he was constructively dismissed. On appeal, the NLRC reversed the Labor Arbiter‘s decision. Broadcom assailed the NLRC‘s ruling, raising the new ne w argument that the case involved an intra-corporate controversy and thus, within the jurisdiction of the RTC and not of the Labor Arbiter. The CA granted Broadcom‘s petition and agreed that the case involved an intra-corporate controversy which, pursuant to Presidential Decree No. 902-A, as amended, was within the exclusive jurisdiction of the RTC. The CA found that Cosare was indeed a stockholder of Broadcom, and that he was listed as one of the directors. Moreover, he held the position of AVP for Sales which is listed as a corporate office. Hence, aggrieved by the decision of the CA, he raised it to the SC.

21 G .R. No. 201298 February 5, 2014

ISSUE:

Cosare vs. Broadcom Asia Inc .

Whether or not this involved a n intra-corporate controversy.

FACTS: RULING:

Broadcom Asia Inc. (Broadcom) is engaged in the  business of selling b r o a d c a s t equipment needed  by television networks networks and production production houses. One of

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The Supreme Court held that the mere fact that an employee was a stockholder and an officer at the time he was illegally dismissed will not necessarily make the case an intra-corporate dispute. The Supreme Court reversed the CA and explained the definition of corporate officers for the  purpose of identifying an intra-corporate intra-corporate controversy. Citing Garcia v. Eastern Telecommunications Telecommunications Philippines Inc. (G.R. No. 173115, April 16, 2009), the Court said that corporate officers, in the context of PD 902-A, are those officers of the corporation who are given that character by the Corporation Code or by the corporation‘s by-laws. by -laws. The Court further held that an ―office‖ is created by the charter of the corporation and the officer is elected by the directors and stockholders of the corporation. The Court explained that two circumstances must concur in order for an individual to be considered a corporate officer, namely: (1) the creation of the position is under the corporation‘s bybylaws; and (2) the election of the officer is by the directors or stockholders. It is only when the officer claiming to have been illegally dismissed is classified as such corporate officer that the issue is deemed an intra-corporate dispute which falls within the  jurisdiction of the trial courts. Broadcom failed to sufficiently establish that the position of AVP for Sales was created by virtue of an act of its board of directors, and that Cosare was specifically elected or appointed to such  position by the directors. Considering that the

the Third Aircraft Generation Squadron (3 AGS) at Clark Air Base, Pampanga. On August 10, 1988, 3 AGS terminated the contract for the maintenance and upkeep of the dormitories with the De Guzman Custodial Services. The employees thereof, including private respondents, were allowed to continue working for 3 AGS. It was left to the new contractor, the JAC Maintenance Services owned by Joselito Cunanan, to decide whether it would retain their services. Joselito Cunanan, however, chose to bring in his own o wn workers. As a result, the workers of the De Guzman Custodial Services were requested to surrender their  base passes to Lt. Col. Frankhauser Frankhauser or to petitioner. petitioner. On August 12, 1988, private respondents filed a complaint with the Regional Arbitration Branch No. III of the NLRC, San Fernando, Pampanga, against  petitioner, Lt. Col. Frankhauser, and Cunanan for illegal dismissal and underpayment of wages. On September 9, 1988, private respondents amended their complaint and added therein claims for emergency cost of living allowance, thirteenth-month  pay, service incentive leave pay and holiday  premiums. Petitioner and Lt. Col. Frankhauser failed to answer the complaint and to appear at the hearings. They, likewise, failed to submit their position paper, which the Labor Arbiter deemed a waiver on their part to do so. The case was therefore submitted for decision on the basis of private respondents' position paper and supporting documents. On November 21, 1988, the Labor Arbiter rendered a

dispute particularly relates to ofCosare‘s to rights and obligations as a regular officer Broadcom, instead of a stockholder of the corporation, the controversy cannot be deemed intra-corporate, the Court concluded

decision granting claims of private respondents. He foundallboththe Lt. Col. Frankhauser and  petitioner "guilty of illegal dismissal" and ordered them to reinstate private respondents with full back wages, or if that is no longer possible, to pay private respondents' separation pay.

22. T/SGP Larkins vs. NLRC, G.R. No. 92432, February 23, 1995

Petitioner appealed to the NLRC claiming that the Labor Arbiter never acquired jurisdiction over her  person because no summons or copies of the complaints, both original and amended, were ever served on her.

Facts: Issue: 

Petitioner was a member of the United States Air Force (USAF) assigned to oversee the dormitories of

Whether or not Labor Arbiter acquired jurisdiction over petitioners‘ person because no summons or

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copies of the complaints, both original and amended, were ever served.

Ruling:

Labor no jurisdiction over the case and theArbiter person acquired of petitioner. Firstly, the "Agreement Between the Republic of the Philippines and the United States of America Concerning Military Bases," otherwise known as the R.P. —  R.P.  —  U.S.  U.S. Military Bases Agreement, governed the rights, duties, authority, and the exercise thereof by Philippine and American nationals inside the U.S. military bases in the country. Article XIV is the governing procedure for service of summons on persons inside U.S. military bases. Summonses and other processes issued by Philippine courts and administrative agencies for United States Armed Forces personnel within any U.S. base in the Philippines could be served therein only with the  permission of the Base Commander. If he withholds giving his permission, he should instead designate another person to serve the process, and obtain the server's affidavit for filing with the appropriate court. Respondent Labor Arbiter did not follow said  procedure. He instead, addressed the summons to Lt. Col. Frankhauser and not the Base B ase Commander. Secondly, under Base Labor Agreement of May 27, 1968, any dispute or disagreement between the United States Armed Forces and Filipino employees should be settled under grievance or labor relations  procedures established established therein (Art. II) or by the arbitration process provided in the RomualdezBosworth Memorandum of Agreement dated September 5, 1985. If no agreement was reached or if the grievance procedure failed, the dispute was appealable by either party to a Joint Labor Committee established in Article III of the Base Labor Agreement. Therefore, no jurisdiction was ever acquired by the Labor Arbiter over the case and the person of  petitioner and the judgment rendered is null and void (Filmerco Commercial Co. v. Intermediate Appellate  supra.; Sy v. Navarro, 81 SCRA 458 [1978]). Court, supra

Lastly, notices of hearing are not summonses. It is  basic that the Labor Arbiter cannot acquire  jurisdiction over the person without being served with summons. In the absence of service of summons or a valid waiver thereof, the hearings and judgment rendered by the Labor Arbiter are null and void  supra.) (cf. Vda. de Macoy v. Court of o f Appeals, supra Petitioner, in the case at bench, appealed to the  NLRC and participated in the oral argument before the said body. This, however, does not constitute a waiver of the lack of summons and a voluntary submission of her person to the jurisdiction of the Labor Arbiter. If an appearance before the NLRC is  precisely to question the jurisdiction of the said agency over the person of the defendant, then this appearance is not equivalent to service of summons (De los Santos v. Montera, 221 SCRA 15 [1993]). The petition for certiorari is GRANTED.

23. UERM Memorial Medical Center vs. NLRC, G.R. No. 110419, March 3, 1997

FACTS:

On 12 April 1988, Policy Instruction No. 54 was issued by the SOLE, which reads:

―the personnel in subject hospitals and clinics are entitled to a full weekly wage of seven days if they have completed the 40-hour/5-day workweek in any given work week.‖  week.‖  

Petitioners challenged the validity of said Policy Instruction and refused to pay the salaries of the  private respondents respondents for Saturdays and Sundays. 

Within the reglementary period for appeal, the  petitioners filed their Notice and Memorandum of Appeal with a Real Estate Bond consisting of land and various P102,345,650.

UNIVERSITY OF SAN CARLOS SCHOOL OF LAW AND GOVERNANCE

improvements

therein

worth

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 Relations Commission  (246

The private respondents moved to dismiss the appeal on the ground that Article 223 of the Labor Code, as amended, requires the posting of a cash or surety  bond. The NLRC directed petitioners to post a cash or surety bond of P17,082,448.56 with a warning that failure to do so would cause the dismissal of the appeal.

The NLRC directed petitioners to post a cash or surety bond of P17,082,448.56 with a warning that failure to do so would cause the dismissal of the appeal.

ISSUE: whether or not in perfecting an appeal to the  National Labor Relations Commission (NLRC) a

 property is excluded two forms formsinof Article appeal  bond  —   bond cash or surety  — by   asthe  as enumerated 223 of the Labor Code.

HELD: The applicable law is Article 223 of the Labor Code, as amended by Republic Act No. 6715, which provides: "In 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." We have given a liberal interpretation to this provision. In YBL (Your Bus  Line) v . NLRC , 190 SCRA 164 (1990) we ruled: ". . . that while Article 223 of the Labor Code, as amended  by Republic Act No. 6715, requiring a cash or surety  bond in the amount equivalent to the monetary award in the judgment appealed from for the appeal to be  perfected, may be considered a jurisdictional requirement, nevertheless, adhering to the principle that substantial justice is better served by allowing the appeal on the merits threshed out by the NLRC, the Court finds and so holds that the foregoing requirement of the law should be given a liberal interpretation." Then  Electric Cooperative,

too, Inc . inv. Oriental NationalMindoro Labor

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SCRA 801 [1995]), we held: "The intention of the lawmakers to make the  bond an indispensable requisite for the perfection of an appeal by the employer is underscored by the  provision that an appeal by the employer may be  perfected "only upon the posting of o f a cash or surety  bond." The word "only" " only" makes it perfectly clear, that the lawmakers intended the posting of a cash or surety bond by the employer to be the exclusive means by which an employer's appeal may be  perfected. The requirement is intended to discourage employers from using an appeal to delay, or even evade, their obligation to satisfy their employees' just and lawful claims. Considering, however, that the current policy is not to strictly follow technical rules  but rather to take into account the spirit and intention of the Labor Code, it would be prudent for us to look into the merits of the case, especially since petitioner disputes the allegation that private respondent was illegally dismissed."

In the case at bar, b ar, the judgment involved is more than P17 million and its precipitate execution can adversely affect the existence of petitioner medical center. Likewise, the issues involved are not insignificant and they deserve a full discourse by our quasi-judicial and judicial authorities. We are also confident that the real property bond posted by the  petitioners sufficiently protects the interests of  private respondents should they finally prevail. It is not disputed that the real property offered by  petitioners is worth P102,345,650. The judgment in favor of private respondent is only a little more than P17 million. The case is remanded to the NLRC for continuation of proceedings.

24. PHIL. TRANCO SERVICES VS. NLRC  April 1, 1998, G.R. No. 124100   Facts:

 Nieva was employed as a driver by  petitioner assigned to the Legaspi City-Pasay City route. Nieva sideswiped sideswiped an owner-type jeep jeep and a criminal complaint complaint was filed filed against him. Philtranco  posted a bail bond for Nieva. After having been 39

 

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suspended, he was told to wait until his case was settled. The case was finally settled settled he was requested requested to file a new application as he was no longer considered an employee of Philtranco, allegedly for  being absent without leave from October 19 to  November 20, 1989. 1989.  Nieva filed a complaint for illegal dismissal and demanded for 13th month pay with the NLRC‘s  National Capital Region Arbitration Branch in Manila. Philtranco filed a motion to dismiss on the ground of improper venue, stating that the complaint should have been been lodged with the NLRC‘s Regional Arbitration Branch in Legaspi City, not only because  Nieva was a resident thereof, but also because the latter was hired, assigned, and based in Legaspi City. Issue:

Whether or not NLRC‘s NCR Arbitration Branch in Manila was a proper venue for the filing of  Nieva‘s complaints complaints for illegal illegal dismissal dismissal  Ruling:

The filing of the complaint co mplaint with the National Capital Arbitration asBranch proper, Manila Region being considered part was of Nieva‘s workplace by reason of his plying the Legaspi CityPasay City route. In fact, Section 1(a), Rule IV of the  New Rules of Procedure of the NLRC is merely  permissive. Provisions on venue are intended to assure convenience for the employee and his witnesses and to promote the ends of justice provided that it is not oppressive to the employer.

25 St. Martin Funeral Homes vs. NLRC, G.R. No. 142351, Nov. 22, 2006  Facts: The owner of petitioner St. Martin Funeral Homes, Inc. (St. Martin) Martin) is AmelitaMalabed. AmelitaMalabed. Prior to January 1996, Amelita‘s mother mot her managed the funeral  parlor. In 1995, Aricayos was granted financial assistance by Amelita‘s mother.  mother.   As a sign of appreciation, respondent extended assistance in managing St. Martin Martin without without compensation compensation and no written employment contract between Amelita‘s Amelita‘s mother and respondent Aricayos; furthermore, respondent Aricayos was not even listed as an employee in the Company‘s payroll.  payroll.  When Amelita‘s mother died in January 1996, Amelita took over as manager of St. Martin. Much to her chagrin, she found out that St. Martin had arrearages in the payment of BIR taxes and other fees owing to the government, but company records tended to show that payments were made thereon. UNIVERSITY OF SAN CARLOS SCHOOL OF LAW AND GOVERNANCE

As a result, Amelita removed the authority from respondent Aricayos and his wife from taking part in managing St. Martin‘s operations. operations.   Aggrieved, respondent Aricayos accused St. Martin of his illegal dismissal as Operations Manager of the company. He believed that that the cause of his termination was Amelita‘s suspicion that he pocketed PhP 38,000.00 which was set aside for payment to the BIR of St. Martin‘s valued added taxes.On October 25, 1996, the Labor Arbiter rendered a Decision, in favor of petitioner declaring that his office had no jurisdiction over the case.  NLRC issued a Resolution annulling the Arbiter‘s Decision and remanded the case to him for appropriate proceedings, to determine the factual issue of the existence of employer-employee relationship between the parties. When its motion for reconsideration was rejected by the NLRC, petitioner filed a petition for certiorari under Rule 65 before this Court, docketed as G.R. No. 130866. On September 16, 1998, this Court through Justice Jose Vitug, rendered the landmark Decision in this case then docketed as G.R. No. 130866, holding for time that petitionsoffor under Rulethe65first assailing the all decisions thecertiorari NLRC should henceforth be filed with the CA Issue: WON a petitioner can file his petition for certiorari under Rule65 to assail the decision of a lower court like NLRC.   Ruling:

A petition for certiorari under Rule65 must first be filed at the Court of Appeals. Said court has a concurrent jurisdiction on petitions for certiorari, mandamus, prohibitions. This is in consonance with the hierarchy of courts. 26. Ludo & Luym Corp., vs. Saornido, G.R. No. 140960, January 20, 2003

Facts: Petitioner LUDO & LUYM CORPORATION (LUDO for brevity) is a domestic corporation engaged in the manufacture of coconut oil, corn starch, glucose and related products. It operates a manufacturing manufact uring  plantt located  plan located at Tupas Street, Cebu City and a wharf where raw materials and finished products are shipped out

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In the course of its business operations, LUDO engaged the arrastre services of Cresencio Lu Arrastre Services (CLAS) for the loading and unloading of its finished products at the wharf. Accordingly, Accordingl y, several arrastre workers were deployed by CLAS to perform the services needed by LUDO

AND SIXTY ONE (P5,707,261.61)  petitioner raises raises the following following issues:  



These arrastre workers were subsequently hired, on different dates, as regular rank-and-file employees of LUDO every time the latter needed additional manpower services. services. Said employees thereafter thereafter joined respondent union, the LUDO Employees Union (LEU), which acted as the exclusive bargaining agent of the rank-and-file employees. On April 13, 1992, respondent union entered into a collective bargaining agreement with LUDO which  provides certain benefits to the employees, the amount of which vary according to the length of service rendered by the availing employee.

 

WHETHER OR NOT BENEFITS CONSISTING OF SALARY INCREASES, VACATION LEAVE AND SICK LEAVE BENEFITS FOR THE YEARS 1977 TO 1987 ARE ALREADY BARRED BY PRESCRIPTION WHEN PRIVATE RESPONDENTS FILED THEIR CASE IN JANUARY 1999

Petitioner contends that the appellate court gravely erred when it upheld the award of  benefits which were beyond the terms of



the union requested LUDO to include in its members‘  period of service the the time during which they rendered arrastre services to LUDO through the CLAS so that they could get higher benefits. LUDO failed to act on the request. Thus, the matter was submitted for voluntary arbitration.

CENTAVOS

decision dated April 18, 1997, the Voluntary Arbitrator ruled that: (1) the respondent employees were engaged in activities necessary and desirable to the business of petitioner, and (2) CLAS is a laboronly contractor of petitioner .[2] It disposed of the case

submission Petitioner asserts that the arbitratoragreement. must confine its adjudication to those issues submitted by the parties for arbitration, which in this case is the sole issue of the date of regularization of the workers. Hence, the award of benefits by the arbitrator was done in excess of jurisdiction   Respondents, for their part, aver that the three-year prescriptive period is reckoned only from the time the obligor declares his refusal to comply with his obligation in clear and unequivocal terms. In this case, respondents maintain that LUDO merely promised to review the company records in response to respondents‘ demand for adjustment in the date of their

thus:

regularization without making a categorical statement of refusal

The parties accordingly executed a submission agreement raising the sole issue of the date of regularization of the workers for resolution by the Voluntary Arbitrator.

 

the 214 complainants, as listed in the Annex A, shall be considered regular employees of the respondents six (6) months from the first day of service at CLAS;   the said complainants, being entitled to the CBA benefits during the regular employment, are awarded a) sick leave,  b) vacation leave & c) annual wage and salary increases during such period in the amount of FIVE MILLION SEVEN HUNDRED SEVEN THOUSAND TWO HUNDRED SIXTY ONE PESOS







Ruling  



we held in  in San Jose vs. NLRC , that the  jurisdiction of the Labor Arbiter and the Voluntary Arbitrator or Panel of Voluntary Arbitrators over the cases enumerated in the Labor Code, Articles 217, 261 and 262, can  possibly include money claims in one form or another .]  Comparatively, in Reformist in   Reformist Union of R.B. Liner, Inc. vs. NLRC  

compulsory arbitration has been defined  both as ―the process of settlement of labor disputes by a government agency which has the authority to make an award which to is investigate binding on and all the parties,

and as a mode of arbitration where the UNIVERSITY OF SAN CARLOS SCHOOL OF LAW AND GOVERNANCE

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 parties are compelled to accept the resolution of their dispute through arbitration by a third party   In general, the arbitrator is expected to decide those questions expressly stated and limited in the submission agreement. However, since since arbitration is is the final resort for the adjudication of disputes, the arbitrator can assume that he has the  power to make make a final settlement settlement   While the submission agreement mentioned only the determination of the date or regularization, law and jurisprudence give the voluntary arbitrator enough leeway of authority as well as adequate prerogative to accomplish the reason for which the law on voluntary arbitration was created  –   speedy labor justice.   Since the parties had continued their negotiations even after the matter was raised  before the Grievance Procedure and the voluntary arbitration, the respondents had not refused to comply comply with their duty. duty. They

In April 1998, 712 employees filed complaints for illegal dismissal and for payment of benefits against  petitioners, before the NLRC. The complainants averred that they were regular employees of Hanjin and that they were separated from employment without any lawful or just cause. Only 521 of the complainants affixed their signatures in the

 just wanted the complainants to present some proofs. The complainant‘s cause of action had not therefore accrued yet. Besides, in the earlier voluntary arbitration case aforementioned involving exactly the same issue and employees similarly situated as the complainants‘, the same defense was raised and dismissed by Honorable Thelma Jordan, Voluntary Arbitrator.

 project. documentHowever, to supportpetitioners their claim.failed to append any







27. Hansin Engineering & Construction vs. CA, G.R. No. 165910, April 10, 2006

Facts:

complaints. Petitioners alleged that the complainants were mere  project employees in its Bohol Irrigation Project and that 2 of the workers were charged with qualified theft before the RTC. Some of the complainants had already migrated to USA or had died, while 117 of them were still under the employ of Hanjin. Petitioner stated that some of the complainants had voluntarily resigned; 14 were absent without prior approved leave; 15 had signed a Motion to Withdraw from the complaint; and many of the complainants were separated on account of the completion of the

Labor Arbiter rendered judgment in favor of the 428 complainants, granting separation pay and attorney's fees to each of them stating that the complainants were regular employees of petitioner and their claims for underpayment, holiday pay, premium pay for holiday and rest day, 13th month pay, and service incentive leave would be computed after sufficient data were made available. Petitioners appealed the decision to the NLRC, which affirmed with modification the Labor Arbiter's ruling. Petitioners filed a Motion for the Reconsideration of the decision (with a motion to conduct clarificatory hearings)

Hanjin is a construction company that had been contracted by the Philippine Government for the construction of various foreign-financed projects. Hanjin and the Philippine Government entered into contracts for the construction of the Malinao Dam at Pilar, Bohol, with a projected completion period of 1,050 calendar days, including main canal and lateral  projects for 750 days. From August 1995 to August 1996, Hanjin contracted the services of 712 carpenters, masons, truck drivers, helpers, laborers, heavy equipment operators, leadmen, engineers, steelmen, mechanics, electricians electricians and others.

 NLRC partially granted petitioners' motion. Unsatisfied, petitioners filed a Petition for Certiorari under Rule 65 of the Revised Rules of Court in the CA. CA dismissed dismissed the the petition and affirmed affirmed the  NLRC's ruling that the dismissed employees were regular employees. The CA stressed that petitioners failed to refute the claim of the respondents that they were regular employees. Petitioners moved to reconsider the decision, which the CA denied.

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Issue: WON respondents are project employees.

 

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Ruling: While respondent alleged that "complainants all signed a contract of employment at the time they were hired indicating therein the particular project

Complainants herein were, therefore, non-project employees, but regular employees. Admittedly, being a duly licensed contractor firm in the Philippines, respondent is the awardee of several construction  projects and in many occasions it has been given the  priority in the the awarding of subsequent projects.

they will beprovided working inon, their the period and which other conditions contracts complainants fully knew and understood," nowhere in the records can the said contracts be found. Moreover, let it be stressed that under DO No. 19, Series of 1993 on project employment, six (6) indicators are enumerated therein and one of which is that: "(T)he termination of his employment in the  particular project/undertaking project/undertaking is reported to the Department of Labor and Employment (DOLE) Regional Office having jurisdiction over the workplace within 30 days following the date of his separation from work x x x."

In the light of the above facts and circumstances, the respondent's main defense that completion of the  project worked on by the complainants constitute a valid cause of termination is unsustainable. To repeat, there is no substantial evidence on record to sustain this contention. The mere allegation of the respondents that under their employment contracts the complainants were made to understand that they were project employees is definitely not persuasive or unworthy of credence. The best evidence of which would have been the alleged contracts. These employees signed duly notarized waivers/quitclaims and who did not recant later. In the absence of

In this particular case, the records do not show that a similar report was ever made by respondent to the Department of Labor and Employment. Such failure of respondent employer to report to the nearest employment office of the Department of Labor, the termination of the workers it claimed as project employees at the time it completed the project, is  proof that complainants complainants were not project employees. employees.

evidence the contrary, said quitclaims executed showing voluntarily and without any forcewere or intimidation.

The principal test for determining whether particular employees are properly characterized as project employees is: whether or not the project employees were assigned to carry out a specific project or

Petitioners submitted to the NLRC dubious machine copies of only some of respondents? contracts, including alleged employment termination reports submitted to the DOLE. The NLRC found the contracts barren of probative weight and utterly insufficient to buttress the contention of petitioners that respondents were only project employees. Contrary to the representation of respondent's counsel, the original copies of the reports made to

undertaking, the duration of engaged which were specified at the time the employees were for that project. Predetermination of the duration or period of project employment is essential in resolving whether one is a  project employee or not. In the instant case, the completion of the project for which the complainants were hired was not determined at the start of their employment, there being no substantial proof thereof. The fact that complainants had rendered more than one year of service at the time of their dismissal and there being no substantial evidence to support that they were engaged to work on a specific project or undertaking, overturns respondent‘s allegation that complainants were project employees hired for a specific fixed project for a limited period of time.

The actual continuous employment of complainants  by respondent Hanjin since 1991 until 1995 overcomes the piecemeal "appointments" covering for periods of six (6) months or less. From these short term but repeated "appointments," it is apparent that the periods have been imposed to preclude the acquisition of tenurial security by the employee and which kind of employment contracts should be disregarded for being contrary to public policy.

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DOLE were never produced and submitted to this Commission. Neither were they presented for comparison with the machine copies. These machine copies were not also certified as true copies by the DOLE.

 

LABOR STANDARDS LAW

The appellate court, the NLRC and the Labor Arbiter are thus one in finding that respondents were not  project employees, and in sustaining respondents' claim of illegal dismissal due to petitioners? failure to adduce contrary evidence. Well-settled is the rule that findings of fact of quasi-judicial agencies, like the  NLRC, are accorded not only respect but at times

Thereafter, the parties executed a Compromise Agreement  dated July 9, 2001, where PJI undertook to reinstate the 31 complainant-employees effective July 1, 2001 without loss of seniority rights and  benefits; 17 of them who were previously retrenched were agreed to be given full and complete payment of

even finality if such findings are supported by substantial evidence. Such findings of facts can only  be set aside upon showing of grave abuse of discretion, fraud or error of law, none of which have  been shown in this case.

their respective monetary claims, while 14 others would be paid their monetary claims minus what they received by way of separation pay. The compromise agreement was submitted to the NLRC for approval. The compromise agreement was approved and was deemed closed and terminated.

28. ) G.R. No. 166421 PHILIPPINE JOURNALISTS, INC., BOBBY DELA CRUZ, ARNOLD BANARES and ATTY. RUBY RUIZ BRUNO, petitioners,  petitioners, vs. NATIONAL LABOR RELATIONS COMMISSION, HON. COMMS. LOURDES JAVIER, TITO GENILO and ERNESTO VERCELES, JOURNAL EMPLOYEES UNION, and THE COURT OF APPEALS,  respondents

The Philippine Journalists, Inc. (PJI) is a domestic corporation engaged in the publication and sale of newspapers and magazines. The exclusive bargaining agent of all the rank-and-file employees in the company is the Journal Employees Union (Union for  brevity). Sometime in April 2005, the Union filed a notice of strike before the National Conciliation and Mediation Board (NCMB), claiming that PJI was guilty of unfair labora retrenchment practice. PJIprogram was then to implement due going to "overstaffing or bloated work force and continuing actual losses sustained by the company for the past three years resulting in negative stockholders equity of P127.0 million. After submitting their respective papers, in its resolution dated May 31, 2001, the NLRC declared that the 31 complainants were illegally dismissed and that there was no basis for the petitioners retrenchment program thus it ordered their reinstatement to their former position without loss of seniority rights and other other benefits, with  payment of unpaid unpaid salaries, bonuses bonuses and backwages. backwages.

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The Union filed another Notice of Strike on July 1, 2002 claiming that 29 employees where illegally dismissed. After the retrenchment program was implemented, the members-employees who continued working were made to sign 5 month contract and was threatened to be dismissed if they refused to conform to 40% to 50% salary deduction. The NLRC forthwith issued another Resolution on July 25, 2002, declaring that the Clarificatory Motion of complainants Floro Andrin, Jr. and Jazen M. Jilhani had been mooted by the compromise agreement as they appeared to be included in  paragraph 2.c and paragraph paragraph 2.d, respectively thereof. thereof. As to the seven others who had filed a motion for clarification, the NLRC held that they should have filed individual affidavits to establish their claims or moved to consolidate their cases with the certified case. Thus, the NLRC granted the computation of their benefits as shown in the individual affidavits of the complainants. However, as to the prayer to declare the Union guilty of unfair labor practice, to continue with the CBA negotiation and to pay moral and exemplary damages, the NLRC ruled that there was no sufficient factual and legal basis to modify its resolution. Thus, the compromise agreement was approved and NCMB-NCR-NS-03-087-00 deemed closed and terminated .

was

In its Resolution dated July 31, 2003, the NLRC ruled that the complainants were not illegally dismissed. The May 31, 2001 Resolution declaring the retrenchment program illegal did not attain finality as "it agreement had been academically the compromise entered into mooted betweenbyboth

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 parties on July 9, 2001." According to the Commission, it was on the basis of this agreement that the July 25, 2002 Resolution which declared the case closed and terminated was issued. Thus, the May 31, 2001 Resolution could not be made the basis to justify the alleged continued employment regularity of the 29 complainants subsequent to their retrenchment. The NLRC also declared that by their separate acts of entering into fixed-term employment contracts with  petitioner after their separation from employment by virtue of retrenchment, they are deemed to have admitted the validity of their separation from employment and are thus estopped from questioning it. The NLRC dismissed the case for lack of merit,  but directed the company to "give preference to the separated 29 complainants should they apply for reemployment." In its Decision dated August 17, 2004, the appellate court held that the NLRC gravely abused its discretion in ruling for PJI. The compromise agreement referred only to the award given by the  NLRC to the complainants in the said case, that is, the obligation of the employer to the complainants. The CA also ru ruled led that the dismissed dismissed employees were not barred from pursuing their monetary claims despite the fact that they had accepted their separation pay and signed their quitclaims. Issue: The primary issue which before includes the Court is whether an  NLRC Resolution, a pronouncement that the members of a union had been illegally dismissed, is abandoned or rendered ―moot and academic‖ by a compromise agreement subsequently  subsequently   entered into between the dismissed employees and the employer and if such a compromise agreement constitutes res judicata to a new complaint later filed  by other union members-employees, members-employees, not part parties ies to the agreement, who likewise claim to have been illegally dismissed. Held:

agreed upon by the parties, in conformity with the  basic policy of the State "to promote and emphasize the primacy of free collective bargaining and negotiations, including voluntary arbitration, mediation and conciliation, as modes of settling labor or industrial disputes. ART. 227 Compromise Agreements.  –   Any compromise settlement, including those involving labor standard laws, voluntarily agreed upon by the  parties with the assistance of the Bureau or the regional office of the Department of Labor, shall be final and binding upon the parties. The National Labor Relations Commission or any court shall not assume jurisdiction over issues involved therein except in case of noncompliance thereof or if there is  prima facie evidence that the settlement settlement was obtained through fraud, misrepresentation, or coercion. Thus, a judgment rendered in accordance with a compromise agreement is not appealable, and is immediately executory unless a motion is filed to set aside the agreement on the ground of fraud, mistake, or duress, in which case an appeal may be taken against the order denying the motion. Under Article 2037 of the Civil Code, "a compromise has upon the  parties the effect and authority of res judicata," even when effected without judicial approval; and under the principle of res judicata, an issue which had already been laid to rest by the parties themselves can no longer be relitigated. Adjective law governing judicial compromises annunciate that once approved by the court, a judicial compromise is not appealable and it thereby becomes immediately executory but this rule must be understood to refer and apply only to those who are  bound by the compromise and, on the assumption that they are the only parties to the case, the litigation comes to an end except only as regards to its compliance and the fulfillment by the parties of their respective obligations thereunder. The reason for the rule, said the Court in Domingo v. Court of Appeals [325 Phil. 469], is that when both parties so enter into the agreement to put a close to a pending litigation between them and ask that a decision be

Article 227 of the Labor Code of the Philippines authorizes compromise agreements voluntarily

rendered in conformity therewith, it would only be "natural to presume that such action constitutes an

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implicit waiver of the right to appeal" against that decision. The order approving the compromise agreement thus becomes a final act, and it forms part

Clearly, the situation in the case at bar is one of the things the provision on security of tenure seeks to  prevent.

and parcel of the judgment that can be enforced by a writ of execution unless otherwise enjoined by a restraining order . Thus, contrary to the allegation of petitioners, the execution and subsequent approval by the NLRC of the agreement forged between it and the respondent Union

did

not

render

the

NLRC

resolution

ineffectual, nor rendered it "moot and academic." The agreement becomes part of the judgment of the court or tribunal, and as a logical consequence, there is an implicit waiver of the right to appeal.  

In any event, the compromise agreement cannot bind a party who did not voluntarily take part in the

Lastly, it could not be said that the employees in this case are barred from pursuing their claims because of their acceptance of separation pay and their signing of quitclaims. It is settled that ―quitclaims, waivers and/or complete releases executed by employees do not stop them from pursuing their claims  –  if  if there is a showing of undue pressure or duress. The basic reason for this is that such quitclaims, waivers and/or complete releases being figuratively exacted through the barrel of a gun, are against public policy and therefore null and void ab initio (ACD Investigation Security Agency, Inc. v. Pablo D. Daquera, G.R. No. 147473, March 30, 2004).‖  2004).‖   In the case at bar, the employees were faced with impending termination.

settlement itself and gave specific individual consent. It must be remembered that a compromise agreement is also a contract; it requires the consent of the  parties, and it is only then that the agreement may bbee considered as voluntarily entered into.

As such, it was but natural for them to accept whatever monetary benefits that they could get.

A careful perusal of the wordings of the compromise agreement will show that the parties agreed that the only issue to be resolved was the question of the monetary claim of several employees.

Facts:

The findings of the appellate court are in accord with the evidence pronouncement: on record, and we note with approval the following

29. Balagtas Multi Purpose Coop. vs. CA, G.R. No. 159268, Oct. 27, 2006

Balagtas Multi-Purpose Cooperative, Inc. is a duly organized and existing cooperative under the laws of the Philippines. Sometime in April 1991, Balagtas hired Josefina G. Hipolito-Herrero, as part time manager in its office. Subsequently, Josefina made known of her intention to take a leave of absence. Her proposal was immediately approved. However, after the lapse of her leave of absence, Josefina did not report for work anymore. Later on, she filed her resignation. Consequently Josefina filed a complaint with the Provincial Office of the Department of Labor in Malolos, Bulacan for illegal dismissal, and non-payment of 13th month pay or Christmas Bonus. She also prayed for reinstatement and paid  backwages as well well as moral damages. The Labor Arbiter rendered judgment in favor of complainant and against respondents and ordered the latter to pay the former 13th month pay,

Respondents alleged that it hired contractual employees majority of whom were those retrenched  because of the increased but uncertain demand for its  publications. Respondent Respondent did this almost immediately immediately after its alleged retrenchment program. Another telling feature in the scheme of respondent is the fact that these contractual employees were given contracts of five (5) month durations and thereafter, were offered regular employment with salaries lower than their previous salaries. The Labor Code explicitly  prohibits the diminution of employee‘s benefits.

 backwages appealed and separation pay. toAggrieved,  petitioners the decision NLRC but herein failed

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to post either a cash or surety bond as required by Article 223 of the Labor Code. They filed a manifestation and motion instead, stating, that under Republic Act No. 6938, Article 62(7) of the Cooperative Code of the Philippines, petitioners are exempt from putting up a bond in an appeal from the decision of the inferior court. NLRC ordered

cited by petitioners cannot be taken in isolation and must be interpreted in relation to the Cooperative Code in its entirety. Exceptions are to be strictly but reasonably construed; they extend only so far as their language warrants, and all doubts should be resolved in favor of the general provision

respondents to post a cash or surety bond in the amount of P218,000.00, within 10 inextendible days from receipt receipt of the Order, failure of which shall shall constitute a waiver and non-perfection of the appeal. Balagtas appealed to CA, which dismissed the  petition holding that the exemption from putting up a  bond by a cooperative applies to cases decided by inferior courts only.

rather than the exceptions. 2.   No. Article 119 of the Cooperative Code itself expressly embodies the legislative intention to extend the coverage of labor statutes to cooperatives. For this reason,  petitioners must comply with the requirement set forth in Article 223 of the Labor Code in order to perfect their appeal to the NLRC. It must be pointed out that the right to appeal is not a constitutional, natural or inherent right. It is a privilege of statutory origin and, therefore, available only if granted or provided by statute. The law may

Issues: 1.  WON cooperatives are exempted from filing a cash or surety bond required to perfect an employer‘s appeal under Section 223 of

Presidential Decree No. 442 (the Labor Code); 2.  WON a certification issued by the Cooperative Development Authority constitutes substantial compliance with the requirement for the posting of a bond.   Ruling: 1.   No. Petitioners argue that there are certain  benefits and privileges expressly granted to cooperative under the Cooperative Code. It invoked the provision on Article 62

regarding the exemption from payment of an appeal bond, to wit: (7)All cooperatives shall be exempt from putting up a bond for  bringing an appeal against the decision of an inferior court or for seeking to set aside any third party claim: Provided, That a certification of the Authority showing that the net assets of the cooperative are in excess of the amount of the bond required  by the court in similar cases shall be accepted by the court as a sufficient bond.

validly provide limitations or qualifications thereto or relief to the prevailing party in the event an appeal is interposed by the losing  party. In this case, the obvious and logical  purpose of an appeal bond is to insure, during the period of appeal, against any occurrence that would defeat or diminish recovery by the employee under the  judgment if the latter is subsequently affirmed. Therefore, no error can be ascribed to the CA for holding that the phrase ―inferior courts‖ appearing in Article 62  paragraph (7) of the Cooperative Code does not extend to ―quasi―quasi- judicial  judicial agencies‖ and  and  that, petitioners are not exempt from posting the appeal bond required under Article 223 of the Labor Code.

However, it is only one among a number of such privileges which appear under the article entitled ―Tax and Other Exemptions‖ of the code. The provision UNIVERSITY OF SAN CARLOS SCHOOL OF LAW AND GOVERNANCE

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. 30.  ST. MARTIN FUNERAL HOMES  vs  NATIONAL LABOR RELATIONS COMMISSION (NLRC) (Nov. 22, 2006) FACTS:

Complainant, herein private respondent Aricayos, illegalofdismissal withand prayer for filed a petition, for reinstatement payment back wages damages against petitioner St. Martin Funeral Homes. The initiatory pleading was filed before the NLRC RAB.

The owner of St. Marting Funeral Homes is Amelita Malabed. Amelita‘s mother managed the funeral  parlor. Respondent Aricayos, on the other hand, was formerly an overseas contract worker. Aricayos, in 1995, was granted financial assistance by Amelita’s mother. As a sign of appreciation, Aricayos extended assistance to Amelita’s mother

in managing St. Martin without compensation. There was no written employment contract between them, Aricayos was not even listed as an employee in the Company‘s payroll.

Petitioner asserts that LA already concluded that there was no EE-ER relationship based on the  position papers and memoranda of the parties. parties. On the other hand, respondent Aricayos supports the  pronouncement of the NLRC as affirmed by the CA that there was no determination of the existence of EE-ER relationship. Thus, this is petition for review on certiorari under Rule 45 seeking to reverse the decision of the CA which affirmed the NLRC in remanding the complaint of respondent Aricayos to the Labor Arbiter. ISSUE:

WON the LA made a determination of the presence of an EE-ER relationship between St. Martin and Aricayos based on the evidence on record. Further, WON it is within the authority of the LA to set the labor case for hearing to be able to determine the veracity of the conflicting positions of the parties.

When Amelita Amelita took over, after her mother‘s death, she saw that there were some arrears in the payment of BIR taxes. Thus, Amelita removed the authority from Aricayos and his wife from taking part in managing St. Martin’s operations. Thus, Aricayos accused St. Martin of his illegal dismissal as Operations Manager on the ground of Amelita‘s suspicion that he pocketed money for payment of BIR taxes.

RULING:

LA rendered a decision in favor of St. Martins stating that it had no jurisdiction over the case, citing  Dela Salle University vs. NLRC , as it is the civil court which has jurisdiction to determine whether there is an employer-employee relationship. NLRC, however, reversed the decision stating that LA is so authorized to threshed out the issue of the existence of employer-employee relationship when the facts are not too clear so as the ends of justice would better be served. MR of petitioner was denied by NLRC. P filed for certiorari under Rule 65. The case was remanded to the CA and CA affirmed the decision of  NLRC.

APPLICATION:

While a formal trial or hearing is discretionary on the part of the Labor Arbiter, when there are factual issues that require a formal presentation of evidence in a hearing, the Labor Arbiter cannot simply rely on the position papers, more so, on mere unsubstantiated claims of parties.

In In the case at bar, there are certain admissions by  petitioner St. Martin that should have prodded the Labor Arbiter to conduct a hearing for a more indepth examination of the contrasting positions of the  parties, namely: namely: 1.  That respondent helped Amelita's mother manage the funeral parlor business by running errands for her, 2.  Overseeing the business from 1995 up to January 1996 when the mother died, 3.   business And that operation, after Amelita maderespondent changes in and the private

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his wife were no longer allowed to  participate in the management of St. Martin. Martin. These facts, as admitted by the petitioner and the affidavits of St. Martin's witnesses, could have been examined more in detail by the Labor Arbiter in a hearing to convince himself that there was indeedasnoheemployment relationship between the parties originally found .

CA decision affirmed. Petition DENIED.

damages and attorney‘s fees. Petitioner denied that respondents were its employees. It explained that it found the need to engage external services to augment its regular workforce, which was affected by  peaks in operation, work backlogs, absenteeism, and a nd excessive leaves. leaves. It used to engage the the services of individual workers for definite periods specified in their employment contracts and never exceeding one year. However, such an arrangement arrangement became became the subject of a labor case, in which petitioner was accused of preventing the regularization of such workers. ISSUES:

FACTS:

1. Whether or not the court of appeals was correct when it made its own factual findings and disregarded the factual findings of the labor arbiter and the  NLRC.

Petitioner is a corporation engaged  principally in the production and processing of

2. Whether or not CAMPCO was a mere labor-only contractor.

31. DOLE Philippines, Inc. vs. Medel Esteva, et al. [GR No. 161115 November 30, 2006]

 pineapple exportMulti-Purpose market. Respondents are members offorthethe Cannery Cooperative (CAMPCO). CAMPCO was organized in accordance with Republic Act No. 6938, otherwise known as the Cooperative Code of the Philippines. Pursuant to the Service Contract, CAMPCO members rendered services services to petitioner. petitioner. The number of CAMPCO members that report for work and the type of service they performed depended on the needs of  petitioner at any given time. Although the Service Contract specifically stated that it shall only be for a  period of six months, i.e., from 1 July to 31 December 1993, the parties had apparently extended or renewed the same for the succeeding years without executing another another written contract. contract. It was under these circumstances that respondents came to work for petitioner. DOLE organized a Task Force that conducted an investigation into the alleged labor-only contracting activities of the cooperatives. The Task Force identified six cooperatives that were engaged in labor-only contracting, one of which was CAMPCO. In this case, respondents alleged that they started working for petitioner at various times in the years 1993 and 1994, by virtue of the Service Contract executed between CAMPCO and petitioner. All of the respondents had already rendered more than one year of service service to petitioner. petitioner. While some of the respondents were still working for petitioner, others were put on ―stay home status‖ on varying dates in the years 1994, 1995, and 1996 and were no longer furnished furnished with work thereafter. thereafter. Together, respondents filed a Complaint with the NLRC for illegal dismissal, regularization, wage differentials, UNIVERSITY OF SAN CARLOS SCHOOL OF LAW AND GOVERNANCE

RULING:

Yes. The Court in the exercise of its equity  jurisdiction may look into the records of the case and re-examine the questioned findings. As a corollary, this Court is clothed with ample authority to review matters, even if they are not assigned as errors in their appeal, if it finds that their consideration is necessary to arrive at a just decision of the case. The same principles are now necessarily adhered to and are applied by the Court of Appeals in its expanded  jurisdiction over labor cases elevated through a  petition for certiorari; certiorari; thus, we see no no error on its part when it made anew a factual determination of the matters and on that basis reversed the ruling of the  NLRC. Yes. CAMPCO was a mere labor-only contractor.  First, although petitioner touts the multimillion pesos assets of CAMPCO, it does well to remember that such were amassed in the years following its its establishment. In 1993, whe whenn CAMPCO was established and the Service Contract  between petitioner and CAMPCO was entered into, CAMPCO only had P6,600.00 paid-up capital, which could hardly be considered substantial. It only managed to increase its capitalization and assets in the succeeding years by continually and defiantly engaging in what had been declared by authorized DOLE officials as labor-only contracting. Second,  CAMPCO did not carry out an independent business from petitioner. It was precisely established established to render 49

 

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services to petitioner to augment its workforce during  peak seasons. Petitioner was its only client. Even as CAMPCO had its own office and office equipment, these were mainly used for administrative purposes; the tools, machineries, and equipment actually used  by CAMPCO members when rendering services to the petitioner belonged to the latter. Third, petitioner exercised control over the CAMPCO members, including respondents. respondents. Petitioner attempts attempts to refute control by alleging the presence of a CAMPCO supervisorr in the work premises. Yet, the mere superviso  presence within the the premises of a supervisor from the cooperative did not necessarily mean that CAMPCO had control over its members. members. Section 8(1), Rule VIII, Book III of the implementing rules of the Labor Code, as amended, required for permissible job contracting that the contractor undertakes the contract work on his account, under his own responsibility, according to his own manner and method, free from the control and direction of his employer or principal in all matters connected with the performance of the work except as to the results thereof. thereof. As alleged by the respondents, and unrebutted by petitioner, CAMPCO had members, before working  petitioner, to undergo instructions and for pass the the training provided by petitioner‘s personnel.  personnel.  It was  petitioner who determined and prepared the work assignments of the CAMPCO members. members. CAMPCO members members worked within petitioner‘s plantation and  processing plants alongside regular employees  performing identical jobs, a circumstance recognized as an indicium of a labor-only contractorship. Fourth,  CAMPCO was not engaged to perform a specific and special job or service. service. In the Service Contract of 1993, CAMPCO agreed to assist petitioner in its daily operations, and perform odd jobs as may be assigned. CAMPCO complied complied with this venture venture by assigning members members to petitioner. Apart from that, no other particular job, service with was required from CAMPCO, andwork it is or apparent, such an arrangement, that CAMPCO merely acted as a recruitment agency for petitioner. petitioner. Since the undertaking of CAMPCO did not involve the  performance of a specific job, but rather the supply of manpower only, CAMPCO clearly conducted itself as a labor-only contractor.  Lastly,  CAMPCO members, including respondents, performed activities directly related to the principal business of  petitioner. They worked as can c an processing attendant, feeder of canned pineapple and pineapple processing, nata de coco processing attendant, fruit cocktail  processing attendant, and etc., functions which were, not only directly related, but were very vital to  petitioner‘s business of production and processing proc essing of  pineapple products for export. The declaration that CAMPCO is indeed engaged in the prohibited UNIVERSITY OF SAN CARLOS SCHOOL OF LAW AND GOVERNANCE

activities of labor-only contracting, then consequently, an employer-employee relationship is deemed to exist between petitioner and respondents, since CAMPCO shall be considered as a mere agent or intermediary of petitioner. Since respondents are now recognized as employees of petitioner, this Court is tasked to determine the nature nature of their employment. employment. In consideration of all the attendant circumstances in this case, this Court concludes that respondents are regular employees of petitioner. As such, they are entitled to security security of tenure. They could only be removed based on just and authorized causes as  provided for in the Labor Code, as amended, and after they are accorded procedural due process. Therefore, petitioner‘s acts of placing some of the respondents on ―stay home status‖ and not giving them work assignments for more than six months were already tantamount to constructive and illegal dismissal.

32)G.R. No. 151407, February 6, 2007 INTERCONTINENTAL BROADCASTING CORP. VS. PANGANIBAN

FACTS: Ireneo Panganiban (respondent) was employed as Assistant General Manager of the Intercontinental Intercontinental Broadcasting Corporation (petitioner) from May 1986 until his preventive suspension on August 26, 1988. Respondent resigned from his employment on September 2, 1988. On April 12, 1989, respondent filed a civil case with the RTC of Quezon City, Branch 93 against the members of the Board of Administrators (BOA) of  petitioner alleging, alleging, among others, non-payment of his unpaid commissions. A motion to dismiss was filed  by Joselito Santiago, one of the defendants, on the ground of lack of jurisdiction, as respondent‘s claim was a labor money claim, but this was denied by the RTC. Thus, Santiago filed a petition for certiorari with the CA which granted Santiago‘s petition peti tion for lack of jurisdiction and set aside the RTC‘s Orders. Thereafter, respondent was elected by the BOA as Vice-President for Marketing in July 1992. He resigned in April 1993. On July 24, 1996, respondent filed against petitioner a complaint for illegal dismissal, separation pay, retirement benefits, commissions, and damages. The Labor Arbiterunpaid (LA)

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ordered respondent‘s reinstatement with full  backwages, and the payment of his unpaid commission, damages and attorney‘s fees. Petitioner appealed to to the NLRC but due to petitioner‘s failure to post a bond, the appeal was dismissed. The decision was deemed final and executory.

33. G.R. No. 162813, February 12, 2007, Far East Agricultural Supply, Inc. and/or Alexander Uy vs. Jimmy Lebatique and the Honorable Court Of Appeals

ISSUE: WON respondent‘s claim for unpaid commissions has already prescribed. RULING:

FACTS: The case originated from a complaint for illegal dismissal and nonpayment of overtime pay filed by Jimmy Lebatique, a truck driver against his employer, Far East Agricultural Supply Inc.  

Yes. Respondent‘s claim had already pr escribed escribed as of September 1991. In addition, the claims of private respondent for reinstatement, backwages and benefits in conjunction with his employment from 1986 to 1988 have prescribed.

Lebatique was employed March 1996 and was tasked to deliver animal animal feeds to the company‘s clients. 

The applicable law in this case is Article 291 of the Labor Code which which provides that ―all money claims arising from employer-employee relations accruing during the effectivity of this Code shall be filed within three (3) years from the time the cause of

On January 24, 200o, Lebatique complained about not being payed overtime pay. That same day when he complained, he was suspended by Far East‘s General Manager Manuel Uy for his alleged illegal

action accrued; otherwise they shall be forever  barred.‖

use of company vehicle, and was from entering the company premises whenprohibited he reported to work the next day.  

The term ―money claims‖ covers all money claims arising from an employer-employee relation the  prescription of an action is interrupted by (a) the filing of an action, (b) a written extrajudicial demand  by the creditor, and (c) a written acknowledgment of the debt by the debtor. On this point, the Court ruled that although the commencement of a civil action stops stops the running of the statute of prescription or limitations, its dismissal or voluntary abandonment by plaintiff leaves the  parties in exactly the same position as though no action had been commenced at all. Hence, while the

Lebatique sought the assistance of the DOLE Public Assistance and Complaints Unit for the issue on the nonpayment of his Overtime pay.  Two days after seeking the assistance of the DOLE, he received a telegram from Far East requiring him to report to work. Upon his return, Alexander Uy confronted him about his complaint and after talking to Manuel, Alexander terminated Lebatique. 

filing Case couldprescriptive have interrupted runningofofCivil the three-year period, the its consequent dismissal by the CA due to lack of  jurisdiction effectively canceled the tolling of the  prescriptive period within which to file his money claim, leaving respondent in exactly the same  position as though no civil case had been filed at all. The running of the three-year prescriptive period not having been interrupted by the filing of Civil Case respondent‘s cause of action had already prescribed on September 2, 1991, three years after his cessation of employment on September 2, 1988. Consequently, when respondent filed his complaint for illegal dismissal, separation pay, retirement benefits, and damages in July 24, 1996, his claim, clearly, had

The case revolves around two specific points on (1) whether or not Lebatique was illegally dismissed and on (2) whether or not he is a field personnel who is

already been barred by prescription.

not entitled to overtime pay.

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The Laborwas Arbiter ruled inby favor Lebatique this decision overturned theofNLRC whobut stated that Lebatique was merely suspended and that he is a field personnel not entitled to overtime pay, service incentive leave pay and 13 th month pay. The Court of Appeals reinstated the Arbiter‘s Arbiter‘s ruling so petitioner appealed to the Supreme Court by way of review on certiorari.  ISSUE/S:

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RULING:

The case was remanded to the Labor Arbiter for further proceedings to determine the amount of overtime pay and other monetary  benefits due to Lebatique because: because:  



Lebatique was illegally dismissed

In cases of illegal dismissal, the burden is on the employer to prove that the termination was for a valid cause and in this case the petitioners failed to discharge such burden. As to the petitioner‘s claims that Lebatique was not dismissed but that he abandoned his work after being suspended, ―an employee who takes steps to protest his layoff cannot by any stretch of imagination be said to have abandoned his work‖. Lebatique‘s filing of the complaint is ―proof enough of his desire to return to work, thus negating any suggestion of abandonment.‖   abandonment.‖  



Lebatique is not a field personnel

The definition of a "field personnel" is not merely concerned with the location where the employee regularly performs his duties but also with the fact that the employee‘s performance is unsupervised  by the employer. A field field personnel personnel are those those who who regularly perform their duties away from the  principal place of business of the employer and whose actual hours of work in the field cannot be determined with reasonable certainty. In order to determine whether an employee is a field employee, it is also necessary to ascertain if actual hours of work in the field can be determined with reasonable certainty by the employer. In so doing, an inquiry must be made as to whether or not the employee‘s time and performance are constantly supervised by the employer. Given the above definition, Lebatique is not a field  personnel for the the following reasons: (1) company drivers, including Lebatique, are directed to deliver the goods at a specified time and place; UNIVERSITY OF SAN CARLOS SCHOOL OF LAW AND GOVERNANCE

(2) they are not given the discretion to solicit, select and contact prospective clients; and (3) Far East issued a directive that company drivers should stay at the client‘s premises during truck-ban hours which is from 5:00 to 9:00 a.m. and 5:00 to 9:00 p.m. 34. LETRAN CALAMBA FACULTY and EMPLOYEES ASSOCIATION, petitioner, vs. NATIONAL LABOR RELATIONS COMMISSION and COLEGIO DE SANJUAN DE LETRAN CALAMBA, INC.,respondent.

FACTS: On October 8, 1992, the Letran Calamba Faculty and Employees Association filed with Regional Arbitration Branch No. IV of the NLRC a Complaint against Colegio de San Juan de Letran, Calamba, Inc for collection of various monetary claims due its members. The complaint alleges among many things, that in the computation for 13 th  month pay ofasitsbasis academic personnel respondent does not include therefor their compensation for overloads, that respondent has not paid the wage increase, the salary increase due to the non-academic  personnel as a result of job grading has not been given, that the acts of the respondent has resulted in diminution of benefits of the faculty members. In its  position paper, respondent respondent denied all all the allegations. allegations. Prior to the filing of the above-mentioned complaint, petitioner filed a separate complaint against the respondent for money claims with Regional Office No. IV of the Department of Labor and Employment (DOLE). On the other hand,  pending resolution in another NLRC case, responden school filed with Regional Arbitration Branch No. IV of the NLRC a petition to declare as illegal the strike staged by petitioner. On September 28, 1998, the Labor Arbiter (LA) handling the consolidated cases rendered a Decision dismissing the money claims and declaring the strike illegal. Upon appeal to the NLRC, the  petition was dismissed. Petitioner then availed of an action for certiorari with the CA but was also dismissed. ISSUES: 1.  Whether or nor the CA erred in holding that the factual findings of the NLRCcannot be revied in certiorari proceedings? 2.  Whether or not the teaching overload should  be included in the basis in the computation of their 13th month pay?

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RULING: On the first issue…  issue…  The Court finds no error in the ruling of the CA that since nowhere in the petition is there any acceptable demonstration that the LA or the NLRC acted either with grave abuse of discretion or without or in excess of its jurisdiction, the appellate court has no reason to look into the correctness of the evaluation of evidence which supports the labor tribunals' findings of fact. The findings of the Labor Arbiter, when affirmed by the NLRC and the CA, are binding on the Supreme Court unless patently erroneous. Thus, in a petitioner for review on certiorari, this Court‘s  jurisdiction is limited to reviewing errors of law in the absence of any showing that the factual findings complained of are devoid of support in the records or are glaringly erroneous. In petitions for review on certiorari like the instant case, the Court invariably sustains the unanimous factual findings of the LA, the NLRC and the CA, specially when such findings are supported  by substantial evidence and there is no cogent basis 22

to reverse the same, as in this case. case.   On the second issue Settled is the doctrine that when an administrative or executive agency renders an opinion or issues a statement of policy, it merely interprets a pre-existing law and the administrative interpretation is at best advisory for it is the courts that finally determine what the law means. Hence, while the DOLE order may not be applicable, the Court finds that overload pay should be excluded from the computation of the 13 th  month pay of  petitioner‘s members. members. In the same manner that payment for overtime work and work performed during special holidays is considered additionalregular compensation apart and distinct from anasemployee's wage or  basic salary, an overload pay, owing owing to its very nature nature and definition, may not be considered as part of a teacher's regular or basic salary, because it is being  paid for additional work performed in excess of the regular teaching load.

35. Metro Transit Organization vs. Piglas NFWUKMU et al., G.R. No. 175460, April 14, 2008 Facts:

Petitioner Metro Transit Organization, Inc. (MTO) is a government owned and controlled corporation which entered into a Management and UNIVERSITY OF SAN CARLOS SCHOOL OF LAW AND GOVERNANCE

Operations Agreement (MOA) with the Light Rail Transit Authority (LRTA) for the operation of the Light Rail Transit (LRT) Baclaran-Monumento Baclaran-Monumento Line. For purposes of collective bargaining agreement (CBA), petitioner MTO‘s rank and file employees formed the Pinag-isang Lakas ng Manggagawa sa Metro, Inc.-National Federation of Labor (PIGLAS). Petitioners MTO and PIGLAS entered into a CBA covering the period of 13 February 1995 to 13 February 2000. Thereafter, PIGLAS PIGLAS renegotiated renegotiated the CBA demanding higher benefits. On 25 July 2000, due to a bargaining deadlock, PIGLAS filed a Notice of Strike before the National Conciliation and Mediation Board (NCMB). The striking PIGLAS members refused to accede to the Return to Work Order. Order. Following their their continued non-compliance, on 28 July 2000, the LRTA formally informed petitioner MTO that it had issued a Board Resolution which: (1) allowed the expiration after 31 July 2000 of LRTA‘s MOA with  petitioner MTO; and (2) directed directed the LRTA to take take over the operations and maintenance of the LRT Line. By virtue of said said Resolution, petitioner petitioner MTO sent termination notices to its employees, including herein respondents. Resultantly, respondents filed with the Labor Arbiter Complaints Complaints[4] against petitioners and the LRTA for the following: (1) illegal dismissal; (2) unfair labor practice for union busting; (3) moral and exemplary damages; and (4) attorney‘s fees.  fees.  On 13 September 2004, the Labor Arbiter rendered judgment in favor of respondents. Petitioners appealed to the National Labor Relations Commission Commission (NLRC). In a Resolution dated 19 May 2006, the NLRC dismissed petitioners‘ appeal for non-perfection since it failed to post the required bond. Without filing a Motion for Reconsideration of the afore-quoted NLRC Resolution, petitioners filed a Petition for Certiorari with the Court of Appeals assailing the same. They have not, however, filed a motion for reconsideration of the ruling prior to filing the  petition. This renders the the petition fatally fatally defective. defective. Issue: 53

 

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Whether or not the non-filing of motion of reconsideration to the NLRC is a ground for dismissal of the appeal Held:

We agree in the Court of Appeals‘ finding that petitioners‘ case does not fall under any of the recognized exceptions to the filing of a motion for reconsideration,, to wit: (1) when the issue raised is reconsideration  purely of law; law; (2) when public public interest is involved; (3) in case of urgency; or when the questions raised are the same as those that have already been squarely argued and exhaustively passed upon by the lower court. As the Court of Appeals reasoned, the issue  before the NLRC NLRC is both factual and legal at the same time, involving as it does the requirements of the  property bond for for the perfection perfection of the appeal, appeal, as well as the finding that petitioners failed to perfect the same. Evidently, the burden is on petitioners petitioners seeking exception to the rule to show sufficient justification for dispensing with the requirement.   Certiorari cannot be resorted to as a shield from the

Rules of Court, promulgated by authority of law, have the force and effect of law.[  As borne by the records, petitioners filed a  property bond which which was conditionally conditionally accepted accepted by the NLRC subject to the following conditions specified in its 24 February 2006Order: The conditional acceptance of petitioner‘s petitioner‘s property  bond was subject to the submission submission of the following: following: 1) Certified copy of Board Resolution or a Certificate from the Corporate Secretary of Light Rail Transit Authority stating that the Corporation President is authorized by a Board Resolution to submit title as guarantee of judgment award; 2) Certified Copy of the Titles issued by the Registry of Deeds of Pasay City; 3) Certified Copy of the current tax declarations of Titles; 4) Tax clearance from the City Treasurer of Pasay City; 5) Appraisal report of an accredited appraisal company attesting to the fair market value of property within ten (10) days from receipt of this Order. Failure to comply therewith will result result in the dismissal of the appeal for non-perfection thereof.

adverse consequences of petitioners' own omission of the filing of the required motion for reconsideration.  Nonetheless, even if we are to disregard the the  petitioners‘ procedural  procedural  faux faux pas with the Court of Appeals, and proceed to review the propriety of the 19 May 2006 NLRC Resolution, we still arrive at the conclusion that the NLRC did not err in denying  petitioners‘ appeal for its failure to file file a bond in accordance with the Rules of Procedure of the  NLRC. In cases involving a monetary award, an employer seeking to appeal the decision of the Labor Arbiter to the NLRC is unconditionally required by Article 223of thetoLabor Code toofpost a cash or surety  bond equivalent the amount the monetary award adjudged. It should be stressed that that the intention of lawmakers to make the bond an indispensable requisite for the perfection of an appeal by the employer is underscored by the provision that an appeal by the employer may be perfected only upon the posting of a cash or surety bond. bond. The word ―only‖ makes it perfectly clear that the lawmakers  lawmakers  intended the posting of a cash or surety bond by the employer to be the exclusive means by which an employer‘s appeal may be perfected. Moreover, perfected.  Moreover, it  bears stressing stressing that the perfection perfection of an appeal in the manner and within the period prescribed by law is not only mandatory but jurisdictional, and failure to conform to the rules will render the judgment sought to be reviewed reviewed final and unappealable. unappealable. It cannot be overemphasized that the NLRC Rules, akin to the UNIVERSITY OF SAN CARLOS SCHOOL OF LAW AND GOVERNANCE

36. J. K. MERCADO & SONS AGRICULTURAL ENTERPRISES, INC., vs  . STO. TOMAS  FACTS: 

On December 3, 1993, the Regional Tripartite Wages and Productivity Board, Region XI, issued Wage Order No. RTWPB-XI-03, granting a Cost of Living Allowance (COLA) to covered workers. On January 28, 1994, petitioner filed an application for exemption from the coverage of the aforesaid wage order. Thus, however, was denied by the regional wage board in an Order dated April 11, 1994.  Notwithstanding the said order, private respondents  Notwithstanding were not given the benefits due them under Wage Order No. RTWPB-XI-03. On July 10, 1998, private respondents filed an Urgent  Motion for Writ of Execution, and Writ of Garnishment seeking the enforcement of subject wage order against several entities including herein  petitioner. On October 7, 1998, the OIC-Regional Director, Region XI, issued a  Writ of Execution for the 54

 

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enforcement of the Order dated April 11, 1994 of the Regional Tripartite Wages and Productivity P roductivity Board. On November 17, 1998 and November 23, 1998, respectively, petitioner filed a  Motion to Quash the Writ of Execution and a  Supplemental Motion to the  Motion to Quash.  Petitioner argued that herein  private respondents' right had already prescribed due to their failure to move for the execution of the April 11, 1994 Order within the period provided under Article 291 of the Labor Code, as amended, or within three (3) years from the finality of the said order. Ruling that the benefits which remained unpaid have not prescribed and that the private respondents need not file a claim to be entitled thereto, the Regional Director denied the Motion to Quash in an   Order dated January 7, 1999.  Not satisfied with the denial of its motion to quash,  petitioner filed a  Notice of Appeal on January 29, 1999. Petitioner argued on appeal that the Regional Director abused his discretion in issuing the writ of execution since it was not a party to the case. Petitioner likewise argued that the Regional Director abused his discretion in issuing the writ of execution in the absence of any motion filed by private respondents. Petitioner likewise claimed that since more than three (3) years have already elapsed from the time of the finality of the order dated April 11, 1994, the right of private respondents to claim the  benefits under the same had already already prescribed. prescribed. However, the appeal to the CA was denied. On March 2, 2001, petitioner filed a  Motion for  Reconsideration  but the

same denied for lack of merit by public respondent in was an Order dated March 14, 2002. Hence, this petition. ISSUES:

WON the claim of the private respondents for cost of living allowance (COLA) pursuant to Wage Order  No. RTWPB-XI-03 has has already prescri prescribed bed because of the failure of the respondents to make the appropriate claim within the three (3) year prescriptive period  provided by Article 291 of the Labor Code, as amended. WON a money claim must be filed first by private respondents against petitioner for the latter's refusal to pay the COLA granted under WO UNIVERSITY OF SAN CARLOS SCHOOL OF LAW AND GOVERNANCE

RULING: A.  NO.

Art. 291 of the Labor Code applies to money claims in general and provides for a 3-year prescriptive  period to file file them. On the other hand, respondent employees' money claims in this case had been reduced to a judgment, in the form of a Wage Order, which has become final and executory. The prescription applicable, therefore, is not the general one that applies to money claims,  but the specific one applying to judgments. Thus, the right to enforce the judgment, having been exercised within five years, has not yet prescribed. Stated otherwise, a claimant has three years to press a money claim. Once judgment is rendered in her favor, she has five years to ask for execution of the  judgment, counted from its finality. finality. This is consistent with the rule on statutory construction that a general  provision should yield to a specific one and with the mandate of social justice that doubts should be resolved in favor of labor. B.  NO.

Clearly, petitioner's contention is premised on the mistaken belief that the right of private respondents to recover their wage differential or COLA under Wage Order No. 03 is still a contestable issue. It must be emphasized that the order dated April 11, 1994 had long become final and executory. Petitioner did not appeal the said order. Having failed to avail of the remedy of appeal of the said order, petitioner cannot belatedly avoid its duty to comply with the said order by insisting that a money claim must first  be filed by herein private respondents. A contrary ruling would result to absurdity and would even unjustly benefit petitioner who for quite sometime had exerted every effort to avoid the obligation of giving the wage differential or COLA granted under Wage Order No. 3.

37. J. Phil. Marine Inc., vs. NLRC, G.R. No. 1753661, August 11, 2008 Facts: Warlito E. Dumalaog (respondent), who served as cook aboard vessels plying overseas, filed on March 4, 2002 before the National Labor 55

 

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Relations Commission (NLRC) a pro-forma complaintt1  against petitioners ─ manning agency Jcomplain JPhil Marine, Inc. (J-Phil), its then president Jesus Candava, and its foreign principal Norman Shipping Services ─ for unpaid money claims, moral and exemplary damages, and attorney‘s fees. Respondent thereafter filed two amended  pro forma complaints complaints2   praying for the award of overtime pay, vacation leave pay, sick leave pay, and disability/medical benefits, he having, by his claim, contracted enlargement of the heart and severe thyroid enlargement in the discharge of his duties as cook which rendered him disabled. Respondent‘s total claim against petitioners was P864,343.30 plus P117,557.60 representing interest and P195,928.66 P195,928.66 representing attorney‘s 3 fees..   fees By Decision Decision4  of August 29, 2003, Labor Arbiter Fe Superiaso-Cellan Superiaso-Cellan dismissed respondent‘s complaint for lack of merit. On appeal, appeal,5  the NLRC, by Decision of September 27, 2004, reversed the Labor Arbiter‘s decision and awarded US$50,000.00 disability

case of non-compliance thereof or if there is  prima  facie  evidence that the settlement was obtained through fraud, misrepresentation, or coercion. That a client has undoubtedly the right to compromise a suit without the intervention of his lawyer  lawye r 24  cannot be gainsaid, the only qualification  being that if such compromise compromise is entered entered into with the intent of defrauding the lawyer of the fees justly due him,25the compromise must be subject to the said fees..   In the case at bar, there is no showing that fees respondent intended to defraud his counsel of his fees. In fact, the Quitclaim and Release, the execution of which was witnessed by petitioner J-Phil‘s J-Phil‘s  president Eulalio C. Candava and one Antonio C. Casim, notes notes that the 20% attorney‘s fees would be "paid 12 April 2007 –  2007 –  P90,000."  P90,000."

 benefit to respondent. It dismissed respondent‘s respondent‘s other6 claims, however, for lack of basis or jurisdiction. jurisdiction .   7 Petitioners‘ Motion for Reconsideration Reconsideration   having been denied by the NLRC, NLRC,8  they filed a petition for certiorar i9 before  before the Court Court of Appeals. By Resolution10  of September 22, 2005, the Court of Appeals dismissed petitioners‘ petition for, inter alia, failure to attach to the petition all material documents, and for defective verification and certification. certificati on. Petitioners‘ Motion for Reconsideration of the appellate court‘s Resolution was denied; denied ;11  hence, they filed the present Petition for Review on Certiorari. During the pendency of the case before this Court, respondent, against the advice of his counsel,

Petitioner was hired by respondent corporation ALCII as a supervisor in its purchasing office. She was thereafter assigned to ALCII's construction project in Davao City as business manager and supervisor of the Administrative Division. Her Davao assignment was from May 1997 to April 15, 1999. Petitioner alleged that respondents refused to pay her salary beginning August 1998 and allowances beginning June 1998, despite her almost weekly verbal follow-up. Petitioner filed a complaint  before the labor arbiter for unpaid unpaid salaries and allowances. Despite several notices and warnings, respondents did not file a position paper to controvert  petitioner's claims. claims. The case was was submitted for for

entered into a compromise  petitioners. He thereupon signed agreement a Quitclaim with and Release subscribed and sworn to before the Labor Arbiter. Issues: WON the compromise agreement is valid even without the intervention of the counsel. Held: Yes. The compromise agreement is valid even without the intervention of the counsel. Article 227 of the Labor Code provides: Any compromise settlement, including those involving labor standard laws, voluntarily agreed upon  by the parties with the assistance of the Department of Labor, shall be final and binding bi nding upon the parties. The National Labor Relations Commission or any court shall not assume  jurisdiction over issues involved therein except in

resolution based solely on petitioner's allegations and evidence. In his June 30, 2000 decision, the labor arbiter ordered ALCII and/or Dexter Ceriales to pay  petitioner P282,560 representing her unpaid salary and allowance. Respondents filed an appeal with motion for reduction of bond in the National Labor Relations Commission (NLRC) without posting any cash or surety bond. In a resolution dated September 6, 2001, the NLRC dismissed respondents' appeal. It ruled that respondents failed to adduce substantial evidence to support their arguments of non-liability. non -liability. Moreover, it found no justifiable reason to grant a reduction in the required bond. Respondents were able to file a motion for reconsideration on time, accompanied by a joint undertaking/declaration undertaking/decl aration in lieu of the cash or surety

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38.  Sy vs. ALC Industries, G.R. No. 168339, October 10, 2008 Facts:

 

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 bond. Nevertheless, Nevertheless, respondents' motion motion for reconsideration was denied. On August 2, 2002, respondents filed a motion for clarification but this was likewise denied. Respondents questioned the NLRC's denial of their motion for clarification and reconsideration in the CA via a petition for certiorari and prohibition. In its March 30, 2005 decision, the CA set aside the resolutions of the NLRC and the decision of the labor arbiter and dismissed dismissed petitioner's complaint.

Article 223. APPEAL. - Decisions, awards, or orders of the Labor Arbiter are final and executory unless appealed to the Commission by any or both parties within ten calendar days from receipt of such decisions, awards, or orders. xxx. In case of a judgment involving a monetary award, an appeal by the employer may be  perfected only upon the posting of a cash or

The explanation advanced by respondents for their failure to pay the appeal bond belies their claim. The  NLRC found that respondents did not pay the appeal  bond on the mistaken mistaken notion that that they were not not liable for the monetary award and had already ceased operations due to bankruptcy. Respondents belatedly filed a bond with their motion for reconsideration of the NLRC's dismissal of their appeal. We cannot countenance such flagrant disregard of established rules of procedure on appeals. Moreover, the filing of a joint undertaking/declaration, undertaking/decl aration, filed way beyond the tenday reglementary period for perfecting an appeal and as a substitute for the cash or surety bond, did not operate to validate the lost appeal. The decision of the labor arbiter therefore  became final and executory for failure failure of respondents respondents to perfect their appeal within the reglementary  period. Clearly, Clearly, the CA no longer longer had jurisdiction jurisdiction to entertain respondents' appeal from the labor arbiter's decision. Respondents point out that we have occasionally allowed exceptions to mandatory and

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. (emphasis supplied) Section 1, Rule VI of the Rules of Procedure of the NLRC, as amended, likewise provides that the appeal must be filed within ten days from receipt of the decision, resolution or order of the labor arbiter. Moreover, Section 6 of the same rules provides that an appeal by the employer e mployer may be perfected only upon the posting of a cash or surety bond. As the right to appeal is merely a statutory privilege, it must  be exercised only in the manner and and in accordance with the provisions of the law. Otherwise, the right to

 jurisdictional requirements in in the perfection perfection of appeals, such as disregarding unintended lapses on the basis of strong and compelling co mpelling reasons. This is true. However, the obvious motive behind respondents' plea for liberality is to thwart petitioner's claims. This we cannot allow. Respondents' lapses were far from unintentional. They were deliberate attempts to circumvent established rules. Respondents' other contention that they were deprived of due process is likewise devoid of merit. Due process is satisfied when the parties are afforded fair and reasonable opportunity to explain their respective sides of the controversy. In Mariveles Shipyard Corp. v. CA, we held: The requirements of due process in labor l abor

appeal is In lost. a long line of cases, we have ruled that the payment of the appeal bond is a jurisdictional requisite for the perfection of an appeal to the NLRC. The lawmakers intended to make the posting of a cash or surety bond by the employer the exclusive means by which an employer's appeal may be  perfected. The rationale rationale for this this rule is: is: The requirement that the employer post a cash or surety bond to perfect its/his appeal is apparently intended to assure the workers that if they prevail in the case, they will receive the money judgment in their favor upon the dismissal of the employers' appeal. It was intended to discourage employers from using an appeal to delay, or even evade, their obligation to satisfy their employee's just and lawful claims.

cases a Labor Arbiter when before the parties are given theis satisfied opportunity to submit their position papers to which they are supposed to attach all the supporting documents or documentary evidence that would prove their respective claims, in the event that the Labor Arbiter determines that no formal hearing would be conducted or that such hearing was not necessary. (emphasis supplied). We ruled in Times Transportation Company, Inc. v. Sotelo: To extend the period of appeal is to prolong the resolution of the case, a circumstance which would give the employer the opportunity to wear out the energy and meager resources of the workers to the point

Issue: WON the decision of the Labor Arbiter has  become final and executory. Ruling:

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that they would be constrained to give up for less than what they deserve in law.

shopping was signed by Company‘s President without proof that he is authorized by the corporation to sign it trough resolution.

39.) PCI TRAVEL CORPORATION,petitioner Vs NLRC

Facts:

Sometime in 1994, respondent NUBE-

Issue: WON the CA was correct in dismissing the case based on the aforementioned technical grounds. Ruling.

AMEXPEA/PCI Travel Employees Union filed a

 No. the Court of Appeals erred in its

Complaint for unfair unfair labor practice against against petitioner

decision. The case must be remanded to the CA for

PCI Travel Corporation. It claimed that petitioner

resolution on the merits.

had been filling up positions left by regular rank-and-

Reasoning.

file with contractual employees, but were performing

President of the corporation can sign the verification

work which were usually necessary and desirable in

and certification without need of a board resolution,

the usual business or trade of the petitioner.

there thus exists a compelling reason for the

Respondent prayed that the Labor Arbiter order the

reinstatement of the petition before the Court of

 petitioner to pay the ―contractual employees‖ the differentials between the wages/benefits of regular

Appeals. A perusal of the petition for certiorari would reveal that petitioner intended to

employees and the actual wages/benefits wages/benefits paid to them

show the grave abuse of discretion committed by the

from the first day of their employment, plus moral

labor tribunals in not allowing the petitioner the

and exemplary damages, and attorney‘s fees of not

ample opportunity to submit its position paper on the

less than P300,000.00 per employee.

alleged violation of the CBA. The Labor Arbiter and

Petitioner moved to dismiss the complaint on the

the NLRC viewed it as a waiver on its part and

ground that the Union was not the real party-in-

hastened to rule that ‖since the complainant‘s

interest. Subsequently, petitioner manifested that

allegations remain unrebutted, they are deemed

while it was ready and willing to prove that said

correct and valid.‖  valid.‖  Due process dictates that a person

employees were provided by independent legitimate

should

contractors and that it was not engaged in labor-only contracting in a position paper yet to be submitted,

heard. Unfortunately, this was not accorded to the  petitioner and such right was even foreclosed when

 petitioner prayed that the Labor Arbiter first resolve

the appellate court dismissed the petition before it on

the issues raised in their motion to dismiss.

technical grounds. grounds. The policy of our judicial judicial system system

Labor Arbiter ruled that motion to dismiss is a

is to encourage full adjudication of the merits of an

 prohibited pleading. Labor arbiter decided that the

appeal. Ends of justice are better served when both

 petitioner is guilty of unfair unfair labor practices. practices.

 parties are heard and the controversy decided on its

Petitioner filed petition for certiorari with the Court

merits. Thus, in the exercise of its equity

of Appeals. However, the CA dismissed the appeal

 jurisdiction, the Court will not hesitate to reverse the

for failure of the petitioner to attach the necessary

dismissal of appeals that are grounded merely on

documents and pleading in support for the relief they sought. Additionally, the verification for non-forum

technicalities.

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be

given

the

opportunity

to

be

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40. Lolita Lopez et al. vs. Quezon City Sports Club, Inc.

 provision of the Collective Bargaining Agreement, the strike it staged on August 12, 1998 is hereby declared illegal and consequently, pursuant to Article 264 of the Labor Code, the individual respondents, namely: RONILO C. LEE, EDUARDO V. SANTIA, CECILLE C. PANGAN, ROMEO M. MORGA, GENARO C. BANDO AND ALEX J. SANTIAGO, who admitted in  paragraph 1 of their position paper that they are officers/members of the complaining Union are hereby declared to have lost their employment status.

Facts: In this case, there are two actions. First, the one initiated by the labor organization and the other initiated by the employer. In the first case, the Kasapiang Manggagawa sa Quezon City Sports Club (union) claims that it is a registered independent labor organization and the incumbent incu mbent collective  bargaining agent of Quezon City Sports Club (QCSC). They filed a complaint for unfair labor  practice against against QCSC on 12 November November 1997. The Union averred that it was ordered to submit a new information sheet. It immediately wrote a letter addressed to the general manager, Angel Sadang, to inquire about the information sheet, only to be insulted by the latter. The members of the union were not paid their salaries salaries on 30 June 1997. A QCSC  board member, member, Antonio Chua allegedly allegedly harassed one of the employees and told him not to join the strike and even promised a promotion. promotion. On 4 July 1997, the union wrote a letter to the management for the release of the members‘ salaries for the period 16-30 16 -30 June 1997, implementation of Wage Order No. 5, and granting of wage increases mandated by the Collective Bargaining Bargaining Agreement (CBA). When its letter went unanswered, the union filed a notice of strike on 10 July 1997 for violation of Article 248 (a)(c)(e) of the Labor Code, nonpayment of overtime  pay, refusal to hear its grievances, grievances, and malicious malicious refusal to comply with the economic provisions of the CBA. After conducting conducting a strike vote, it staged a strike on 12 August 1997. On 16 August 1997, the QCSC placed some of its employees e mployees under temporary lay-off status due to redundancy. The second case: It appears that on 22 December 1997, QCSC also filed a petition for cancellation of registration against the union and to declare the union‘s strike on August 12, 1997 as illegal. This action by QCSC is docketed as NLRC CASE NO. 00-09-0663-97. The Labor Arbiter Ernesto Dinopol declared the strike of the union illegal in its decision  Dinopol decision). The dated October 9, 1998 ( Dinopol dispositive reads:

Back to the first case, the Labor Arbiter (Joel Lustria) found QCSC guilty of unfair labor practice. QCSC appealed from the labor arbiter‘s arbiter‘s decision. decision. It also filed a motion for reduction of the appeal bond to P4,000,000.00. The NLRC ordered the posting of an additional P6,000,000.00). QCSC filed a supplement to its appeal, citing the Dinopol decision. Meanwhile, the National Labor Relations Commission (NLRC) rendered a decision granting the appeal and reversing the  Lustria decision. The  NLRC said that the Dinopol  Decision  Decision in the illegal strike case must prevail over the  Lustria Decision  because of the established doctrine doctrine of primacy primacy and finality of decision. In the illegal strike case, Ronilo Lee, Eduardo Santia, Cecille Pangan, Romeo Morga, Genaro Bando and Alex Santiago lost or forfeited their employment on the day the illegal strike was staged. The NLRC said that the forfeiture of their employment status carries with it the extinction of their right to demand for and be entitled to the economic benefits accorded to them by law and the t he existing CBA. The other complainants (petitioners) meanwhile filed a motion for reconsideration, which was denied by the NLRC. They filed a petition for certiorari under Rule 65 before the Court of Appeals but was denied. Issues: 1. Do the simult simultaneous aneous filing of the motion to reduce

WHEREFORE, in view of the Union‘s having violated the no-strike-no-lockout

the appeal bond and posting of the reduced amount of  bond within the the reglementary period for appeal

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constitute substantial compliance with Article 223 of the Labor Code? 2. Whether the NLRC NLRC erred in declaring declaring them to have lost their employment contrary to the Dinopol   decision which only affected a few of the employees who were union members. Ruling: First issue: Under the Rules, appeals involving monetary awards are perfected only upon compliance with the following mandatory requisites, namely: (1) payment of the appeal fees; (2) filing of the memorandum of appeal; and (3) payment of the required cash or surety bond. Thus, the posting of a bond is indispensable to the  perfection of an appeal in cases cases involving monetary monetary awards from the decision decision of the labor arbiter. arbiter. The filing of the bond is not only mandatory but also a  jurisdictionall requirement that must be complied  jurisdictiona complied with in order to confer confer jurisdiction upon the NLRC. Noncompliance with the requirement renders the decision of the labor arbiter final final and executory. This requirement is intended to assure the workers that if they prevail in the case, they will receive the money  judgment in their favor upon the dismissal of the employer‘s appeal. It is intended to discourage employers from using an appeal to delay or evade their obligation to satisfy their employees‘ just and lawful claims. However, Section 6 of the New Rules of o f Procedure of the NLRC also mandates, among others, that no motion to reduce bond shall be entertained except on meritorious grounds and upon the posting of a bond in a reasonable amount in relation to the monetary award. Hence, the NLRC has the full discretion to grant or deny the motion to reduce the amount of the appeal bond. In the case of Nicol v. Footjoy Industrial Corporation ruled that the bond requirement on appeals involving monetary awards had been and could be relaxed in meritorious cases such as: (1) there was substantial compliance with theconstitute Rules; (2) the surrounding facts and circumstances meritorious grounds to

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reduce the bond; (3) a liberal interpretat interpretation ion of the requirement of an appeal bond would serve the desired objective of resolving controversies on the merits; or (4) the appellants, at the very least, exhibited their willingness and/or good faith by  posting a partial partial bond during the the reglementary  period. Applying these these jurisprudential jurisprudential guidelines, we we find and hold that the NLRC did not err in reducing the amount of the appeal bond and considering the appeal as having been filed within the reglementary  period. The posting of the amount of P4,000,000.00 simultaneously with the filing of the motion to reduce the bond to that amount, as well as the filing of the memorandum of appeal, all within the reglementary  period, altogether altogether constitute substantial compliance compliance with the Rules. Second issue: We rule in favor of petitioners. The assailed Dinopol  decision  decision involves a complaint for illegal strike filed by QCSC on the ground of a ―no--strike no lockout‖ provision in the CBA. ―no CB A. The challenged decision was rendered in accordance with law and is supported by factual evidence on record. In the notice of strike, the union did not state in  particular the the acts, which allegedly allegedly constitute constitute unfair labor practice. Moreover, by virtue of the ―no-strike ―no -strike no lockout‖ provision in the CBA, CB A, the union was  prohibited from staging an economic economic strike, i.e., to force wage or other concessions from the employer, which he not required b ythe by lawstrike to grant. However, should beisnoted that while declared by theit union was held illegal, only the union officers were declared as having lost their employment status . In effect, there was a ruling only with respect to some union members while the status of all others had remained disputed.  There is no conflict between the  Dinopol  and  and the  Lustria decisions. While both rulings involve the same parties and same issues, there is a distinction  between the remedies sought by the parties in these these two cases. In the Dinopol  decision,  decision, it was QCSC which filed a petition to declare the illegality of the 12 August 1997 strike by the union. The consequence of the declaration of an illegal strike is termination 60

 

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from employment, which the Labor Arbiter did so rule in said case. However, not all union members were terminated. In fact, only a few union officers were validly dismissed in accordance with Article 264 of the Labor Code (the six named). Corollarily, the other union members who had merely  participated in the strike but had not committed committed any illegal acts were not dismissed from employment. Hence, the NLRC erred in declaring the employment e mployment status of all employees as having been lost or forfeited by virtue of the Dinopol  decision.  decision. On the other hand, the  Lustria decision involved the unfair labor practices alleged by the union with  particularity.. In said case,  particularity case, Labor Arbiter Lustria sided sided with the Union and found QCSC guilty of such  practices. As As a consequence, the affected employees employees were granted backwages and separation pay. The grant of backwages and separation pay however was not premised on the declaration of the illegality of the strike but onwere the finding that these affectedfrom work, employees constructively dismissed as evidenced by the layoffs effected by the company. Therefore, with respect to petitioners and union officers Alex J. Santiago, Ma. Cecilia Pangan, Ronilo E. Lee, and Genaro Bando, who apparently had been substituted by present petitioner Teresita Bando, the  Dinopol  decision  decision declaring them as having lost their employment status still stands. To recapitulate, the NLRC erred in setting aside the  Lustria decision, as well as in deleting the award of  backwages and separation pay, despite despite the finding finding that the affected employees had been constructively dismissed. Based on the foregoing, the  Lustria decision should  be upheld and therefore therefore reinstated reinstated except as regards regards the four petitioners. 41. Lockheed Detective & Watchman Agency vs UP G.R. No. 185918, April 18, 2012

Facts: Petitioner entered into a contract for security services with respondent. An NLRC Decision holding respondent solidarily liable with petitioner to security guards for P12,142,522.69 became final and a nd

A writ of execution was issued by the Labor Arbiter, which was later on quashed upon motion by respondent. The quashal was reversed by the NLRC. Upon reconsideration, the NLRC reconsidered and modified that the satisfaction of the award will be only against the funds of respondent which are not identified as public funds. The NRLC‘s order and resolution having become final, an alias writ of execution was issued. A notice of garnishment was served upon PNB Diliman Branch. Upon learning of the notice, respondent filed an urgent motion to quash garnishment which was dismissed by the Labor Arbiter. Funds from PNB were withdrawn by the sheriff. Respondent filed a petition for certiorari with the Court of Appeals. The CA dismissed the petition ruling that the funds are not public funds but on reconsideration, amended its decision holding still that the funds are not public funds but the petition is granted because of the case of  National  Electrification Administration vs Morales (NEA case) that all money claims against the government must be first filed with the Commission on Audit. Petitioner moved for reconsideration but was denied. The Amended Decision and Resolution are now being assailed in this petition for review on certiorari. Issue: Whether or not the funds of respondent were  properly garnished? garnished? Ruling: No, the funds of respondent were not  properly garnished. garnished. The Court ruled ruled that the CA correctly cited the NEA case. Respondent is a  juridical personality personality separate separate and distinct from the government and has the capacity to sue and be sued. Thus, it cannot evade execution, and its funds may be subject to garnishment or levy. However, before execution may be had, a claim for payment of the  judgment award award must first be filed with COA  pursuant to Commonwealth Commonwealth Act No. 327. 42.  Portillo vs. Rudolf Lietz, Inc. et al., G.R. No. 196539, October 10, 2012

Facts: Portillo was a Sales Representative of Rudolf Lietz, Inc. pharmaceutical business. Portillo signed an employment contract containing a ‗Goodwill Clause‖ as follows:

executory.

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“It remains understood and you agreed tha t, on the termination of your employment by act of either you or [Lietz Inc.], and for a  period of three (3) years thereafter, you  shall not engage directly or indirectly as employee, manager, proprietor, or solicitor  for yourself or others in a similar or competitive business or the same character of work which you were employed by [Lietz  Inc.] to do and perform. Should you breach this good will clause of this Contract, you  shall pay [Lietz Inc.] as liquidated damages the amount of 100% of your gross compensation over the last 12 months, it being agreed that this sum is reasonable and  just.”    just.”

Portillo subsequently resigned from her employment with Lietz. She demanded from Lietz Inc. for the  payment of her her remaining salaries salaries and commissions, commissions, which were not paid to her upon such resignation. Later, and within the 3-year prohibitory period, Lietz learned that Portillo was hired by Ed Keller Philippine as head of its Pharma Raw Material Department.. Ed Keller is direct competitor Department competitor of Lietz. As Portillo‘s demand for fo r remaining salaries and commissions from Lietz still went unheeded, she filed a complaint with the NLRC for non-payment non -payment of 1½ months‘ salary, 2 months‘ commission, 13th month pay, plus moral, exemplary and actual damages and attorney‘s fees.  fees.   In its position paper, Lietz admitted liability for Portillo‘s money claims. However, Lietz raised the defense of legal compensation: co mpensation: Portillo‘s money claims should be offset against her liability to Lietz for liquidated damages for Portillo‘s breach of o f the ―Goodwill Clause‖ in the employment e mployment contract when she became employed with Ed Keller. Issue: Should the claims of Portillo against Lietz for unpaid wages, commissions, etc. be offset against her liability to Lietz for damages from breach of the ―Goodwill Clause‖ in the the contract? Ruling:  No, it should should not be offset. offset.

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While Portillo‘s claim for unpaid salaries is a money claim that arises out of or in connection with an employer-employee relationship, Lietz‘ claim against Portillo for violation of the goodwill clause is a money claim based on an act done after the cessation of the employment relationship . And, while the jurisdiction over Portillo’s claim is

vested in the labor arbiter, the jurisdiction over Lietz Inc.’s claim rests on the regular courts. 

The difference in the nature of the credits that one has against the other, conversely, the nature of the debt one owes another, which difference in turn results in the difference of the forum where the different credits can be enforced, prevents the application of compensation. The labor tribunal does not have jurisdiction over the civil case of breach of contract.

43. Building Care Corp. vs. Macaraeg, G.R. No. 198357, December 10, 2012

Petitioners are in the business of providing security services to their clients. They hired respondent as a security guard beginning August 25, 1996, assigning her at Genato Building in Caloocan City. However, on March 9, 2008, respondent was relieved of her  post. She was re-assigned to Bayview Park Hotel from March 9-13, 2008, but after said period, she was allegedly no longer given any assignment. Thus, on September 9, 2008, respondent filed a complaint against petitioners for illegal dismissal, underpayment of salaries, non-payment of separation  pay and refund of cash bond. Conciliation and mediation proceedings failed, so the parties were ordered to submit their respective position  papers.

Respondent claimed that petitioners failed to give her an assignment for more than nine months, amounting to constructive dismissal, and this compelled her to file the complaint for illegal dismissal.

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On the other hand, petitioners that respondent was relieved from her post as requested by the client  because of her habitual tardiness, persistent  borrowing of money from employees e mployees and tenants of the client, and sleeping on the job. Respondent filed a complaint for illegal dismissal with the Labor Arbiter.

The Labor Arbiter (LA) in favor of petitioners, holding that the dismissal of Macaraeg was valid, but ordered the former to pay a certain sum as financial assistance. The Appeal which respondent filed with the NLRC was for having been filed out of time. Hence, NLRC declared that the LA's Decision had  become final and executory on June June 16, 2009.

Respondent elevated the case to the CA via a petition for certiorari. The CA reversed and set aside the decision of NLRC and declared Macaraeg to have  been illegally dismissed. Petitioners were ordered to reinstate petitioner without loss of seniority rights,  benefits and privileges; and to pay her backwages and other monetary benefits during the period of her illegal dismissal up to actual reinstatement. Petitioners' motion for reconsideration was denied. Hence, the present petition.

ISSUE: Whether the CA erred in liberally applying the rules of procedure and ruling that respondent's appeal should be allowed and resolved on the merits despite having been filed out of time.

RULING: The Court cannot sustain the CA's Decision. It should  be emphasized that the resort to a liberal application, or suspension of the application of procedural rules, must remain as the exception to the well-settled well-settled  principle that rules must be complied with for the

relaxed in the interest of justice, it is well-settled that these are tools designed to facilitate the adjudication of cases. The relaxation of  pr  proc oceedu dura rall ru rulles in the intere resst of ju jusstice was never intended to  be a license for erring litigants to violate the rules with impunity. Liberality in the interpretation and application of the rules can be invoked only in proper cases and under justifiable causes and circumstances. While litigation is not a game of technicalities, every case must be prosecuted in accordance with the prescribed procedure to ensure an orderly and speedy administration of justice.

The later case of Daikoku Electronics Phils., Inc. v. Raza, further explained that:

To be sure, the relaxation of procedural rules cannot be made without any valid reasons proffered for or underpinning it. To merit liberality, petitioner must show reasonable cause justifying its non-compliance with the rules and must convince the Court that the outright dismissal of the petition would defeat the administration of substantial justice. x x x The desired leniency cannot be accorded absent valid and compelling reasons for such a procedural lapse. x x x

In this case, the justifications given by the CA for its liberality by choosing to overlook the belated filing of the appeal are, the importance of the issue raised, i.e., whether respondent was illegally dismissed; and the belief that respondent should be "afforded the amplest opportunity for the proper and just determination of his cause, free from the constraints of technicalities," considering that the belated filing of respondent's appeal before the NLRC was the fault of re resp spon onde dent nt's's former former counse counsel.l. No Note, te, hhow owever ever,, that that nei neithe therr respondent nor her former counsel gave any explanation or reason citing extraordinary circumstances for her lawyer's failure to abide by the rules for filing an appeal. Respondent merely insisted that she had not  been remiss in following up her case with said lawyer. It is, however, an oft-repeated ruling that the negligence and mistakes of counsel bind the client. A departure from this rule would bring b ring about never-ending suits, so long as lawyers could

orderly administration of justice. In Marohomsalic v. Cole, the Court stated: While procedural rules may be

allege their own fault or negligence to support

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the client‘s case and obtain remedies and reliefs already lost by the operation of law.

It should also be borne in mind that the right of the winning party to enjoy the finality of the resolution of the case is also an essential part of public policy and the orderly administration of justice. Hence, such right is just as weighty or equally important as the right of the losing party to appeal or seek reconsideration within the prescribed period.

When the Labor Arbiter's Decision became final,  petitioners attained attained a vested right to said judgment. judgment. 44. PHILIPPINE BANK OF COMMUNICATIONS vs. THE NATIONAL LABOR RELATIONS COMMISSION et al. December 19, 1986     G.R. No. L-66598

FACTS: Petitioner Philippine Bank of Communications and the Corporate Executive Search Inc. (CESI) entered into a letter agreement dated January 1976 under which (CESI) undertook to provide "Tempo[rary] Services" to petitioner Consisting of the "temporary services" of eleven (11) messengers. The contract  period is described described as being "from January 1976 — .."" The petitioner in truth undertook to pay a "daily service rate of P18, " on a per person basis. Attached to the letter agreement was a "List of Messengers assigned at Philippine Bank of Communications"" which list included, as item No. 5 Communications thereof, the name of private respondent Ricardo Orpiada. Ricardo Orpiada was thus assigned to work with the  petitioner bank. bank. As such, he he rendered services services to the  bank, within the premises of the bank and alongside alongside other people also rendering services to the bank. There was some question as to when Ricardo Orpiada commenced rendering services to the bank. As noted above, the letter agreement was dated January 1976. However, the position paper submitted by (CESI) to the National Labor Relations Commission Co mmission stated that (CESI) hired Ricardo Orpiada on 25 June 1975 as a Tempo Service employee, and assigned him to work

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with the petitioner bank "as evidenced by the appointment memo issued to him on 25 June 1975. " Be that as it may, on or about October 1976, the  petitioner requested requested (CESI) to withdraw withdraw Orpiada's Orpiada's assignment because, in the allegation of the bank, Orpiada's services "were no longer needed." Onthe 29Department October 1976, Orpiada instituted a complaint in of Labor (now Ministry of Labor and Employment) against the petitioner for illegal dismissal and failure to pay the 13th month pay  provided for in Presidential Decree Decree No. 851. This complaint was docketed as Case No. R04-1010184R04 -101018476-E.After investigation, investigation, the Office of the Regional Director, Regional Office No. IV of the Department of Labor, issued an order dismissing Orpiada's complaint for failure of Mr.Orpiada to show the existence of an employer-employee employer-employee relationship  between the bank and himself. himself. Despite the foregoing order, Orpiada succeeded in having his complaint certified for compulsory arbitration in CaseOrpiada, No. RB-IV-11187-77 complaint vs. Philippine entitled  "Ricardo  Bank of Communications, respondent."  During  During the compulsory arbitration proceedings, CESI was  brought into the the picture as an additional additional respondent respondent  by the bank. Both the bank and (CESI) stoutly maintained that (CESI) (and not the bank) was the employer of Orpiada. ISSUE: Whether or not an employer-employee relationship existed between the petitioner bank and private respondent Ricardo Orpiada. The petitioner bank maintains that no employer-employee relationship was established andemployee Ricardo Orpiada and that Ricardobetween Orpiadaitself was an e mployee of (CESI) and not of the bank. The second ("payment of wages") and third ("power of dismissal") factors suggest that the t he relevant relationship was that subsisting between (CESI) and Orpiada, a relationship conceded by (CESI) to be one  between employer employer and employee. Upon the other other hand, the first ("selection and engagement") and fourth ("control of employee's conduct") factors indicate that some direct relationship did exist  between Orpiada Orpiada and the bank and that such relationship may be assimilated to employment. Perhaps the most important circumstance which emerges from an examination the facts of the lateral relationship between theofbank, (CESI) andtriOrpiada is that the employer-employee relationship relationship 64

 

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 between (CESI) and Orpiada was was established  precisely in anticipation of, of, and for the very purpose of making possible, the secondment of Orpiada to the  bank. It is therefore necessary necessary to confront the task of determining the appropriate characterization of the relationship between between the bank and (CESI) was that relationship one of employer and job (independent) contractor or one of employer and "labor-only" " labor-only" contractor? Under the general rule set out in the first and second  paragraphs of Article Article 106, an employer employer who enters enters into a contract with a contractor for the performance of work for the employer, does not thereby create an employer-employes employer-empl oyes relationship between himself and the employees of the contractor. Thus, the employees of the contractor remain the contractor's employees and his alone. Nonetheless when a contractor fails to  pay the wages of his employees employees in accordance with with the Labor Code, the employer e mployer who contracted out the  job to the contractor contractor becomes becomes jointly and severally severally liable with his contractor to the employees of the latter "to the extent of the work performed under the contract" as such employer were the employer of the t he contractor's employees. The law itself, in other words, establishes an employer-employ e mployer-employee ee relationship between between the employer and the job contractor's employees for a limited purpose, i.e., in order to ensure that the latter get paid the wages due to them. A similar situation obtains where there is "labor only" contracting. The "labor-only" contractor-i.e "the  person or intermediary" intermediary" is considered considered "merely as an agent of the employer. " The T he employer is made by the statute responsible to the employees of the "labor only" contractor as if such employees had been directly employed by the employer . Thus, where "labor only" contracting exists in a given case, the statute itself implies or establishes an employeremployee relationship between the employer (the owner of the project) and the employees of the "labor only" contractor, this time for a comprehensive purpose: "employer for purposes of this Code, to prevent any violation or circumvention of any provision of  this Code. " The law in effect holds both the employer and the "laboronly" contractor responsible to the latter's employees for the more effective safeguarding of the employees' rights under the Labor Code. Both the petitioner bank and (CESI) have insisted that (CESI) was not a "labor only" contractor. Section 9 of Rule VIII of Book III entitled "Conditions of

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Employment," of the Omnibus Rules Implementing the Labor Code provides as follows: In contrast, job contracting-contracting contracting-contracting out a  particular job to to an independent contractor is defined defined  by the Implementing Implementing Rules as follows: follows: The of the "labor-only" contracting in Rule VIII,definition Book III of Implementing Rules must be read in conjunction with the definition of job contracting given in Section 8 of the same Rules. The undertaking given by CESI in favor of the bank was not the performance of a specific —  specific —  job  job for instance, the carriage and delivery of documents and parcels to the addresses thereof. There appear to be b e many companies today which perform this discrete service, companies with their own personnel who pick up documents and packages from the offices of a client or customer, and who deliver such materials utilizing their own delivery vans or motorcycles to the addresses. In the present case, the undertaking of (CESI) was to provideits client-thebank-with a certain number of persons able to carry the was workcomplied of messengers . Such undertaking ofout CESI

with when the requisite number of persons were assigned or seconded to the petitioner bank. Orpiada utilized the premises and office equipment of the  bank and not those those of (CESI) Messengerial Messengerial work-the delivery of documents to designated persons whether within or without the bank ba nk premises —  premises —  is  is of course directly related to the day-to-day operations of the  bank. Section 9(2) quoted above does does not require require for its applicability that the petitioner must be engaged in the delivery of items as a distinct and separate line of  business. Succinctly put, CESI is not a parcel delivery company: as its name indicates, it is a recruitment and placement corporation placing bodies, as it were, in d ifferent client companies for longer or shorter  periods of time. time. It is this this factor that, that, to our mind, mind, distinguishes this case from American President v. Clave et al, 114 SCRA 826 (1982) if indeed distinguishing way is needed. The bank urged that the letter agreement entered into with CESI was designed to enable the bank to obtain the temporary services of people necessary to enable the bank to cope with peak loads, to replace temporary workers who were out on vacation or sick leave, and to handle specialized work. There is, of course, nothing illegal about hiring persons to carry out "a specific project or undertaking the completion or termination of which [was] determined at the time of the engagement of [the] employee, or where the 65

 

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work or service to be performed is seasonal in nature and the employment is for the duration of the season" nº•1àw>  The letter (Article 281, Labor Code).