Labor Relations Case Digest

November 8, 2017 | Author: Andrade Dos Lagos | Category: Strike Action, Unfair Labor Practice, Attorney's Fee, Collective Bargaining, Employment
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February 18, 2013

FACTS: In 1999, Pepsi adopted a company-wide retrenchment program denominated as Corporate Rightsizing Program. On July 13, 1999, Pepsi notified the DOLE of the initial batch of forty-seven (47) workers to be retrenched.Among these employees were six (6) elected officers and twenty-nine (29) active members of the LEPCEU-ALU, including herein respondents. On July 19, 1999, LEPCEU-ALU filed a Notice of Strike before the National Conciliation and Mediation Board (NCMB) due to Pepsi’s alleged acts of union busting/ULP. It claimed that Pepsi’s adoption of the retrenchment program was designed solely to bust their union so that come freedom period, Pepsi’s company union, the Leyte Pepsi-Cola Employees Union-Union de Obreros de Filipinas - would garner the majority vote to retain its exclusive bargaining status. ISSUE: Whether Pepsi committed ULP in the form of union busting HELD: NO. Under Article 276(c) of the Labor Code, there is union busting when the existence of the union is threatened by the employer’s act of dismissing the former’s officers who have been duly-elected in accordance with its constitution and by-laws. On the other hand, the term unfair labor practice refers to that gamut of offenses defined in the Labor Codewhich, at their core, violates the constitutional right of workers and employees to self-organization, with the sole exception of Article 257(f) (previously Article 248[f]). Unfair labor practice refers to acts that violate the workers' right to organize. The prohibited acts are related to the workers' right to self-organization and to the observance of a CBA. Without that element, the acts, no matter how unfair, are not unfair labor practices. The only exception is Article 257(f).

GOYA, vs. GOYA, INC. EMPLOYEES UNION-FFW, Respondent. G.R. No. 170054

INC., Petitioner,

January 21, 2013

FACTS: Sometime in January 2004, petitioner Goya, Inc. (Company) hired contractual employees from PESO Resources Development Corporation (PESO) to perform temporary and occasional services in its factory. This prompted respondent Goya, Inc. Employees Union–FFW (Union) to request for a grievance conference on the ground that the contractual workers do not belong to the categories of employees stipulated in the existing Collective Bargaining Agreement (CBA). The Union asserted that the hiring of contractual employees from PESO is not a management prerogative and in gross violation of the CBA tantamount to unfair labor practice (ULP). It noted that the contractual workers engaged have been assigned to work in positions previously handled by regular workers and Union members, in effect violating Section 4, Article I of the CBA, which provides for three categories of employees in the Company. ISSUE: Whether the CBA violation constitute a ULP. HELD: NO. If the terms of a contract, as in a CBA, are clear and leave no doubt upon the intention of the contracting parties, 24 the literal meaning of their stipulations shall control. x x x. In this case, Section 4, Article I (on categories of employees) of the CBA between the Company and the Union must be read in conjunction with its Section 1, Article III (on union security). Both are interconnected and must be given full force and effect. Also, these provisions are clear and unambiguous. The terms are explicit and the language of the CBA is not susceptible to any other interpretation. Hence, the literal meaning should prevail. As repeatedly held, the exercise of management prerogative is not unlimited; it is subject to the limitations found in law, collective bargaining agreement or the general principles of fair play and justice. To reiterate, the CBA is the norm of conduct between the parties and compliance therewith is mandated by the express policy of the law. However, while the engagement of PESO is in violation of Section 4, Article I of the CBA, it does not constitute unfair labor practice as it (sic) not characterized under the law as a gross violation of the CBA.


October 10, 2012

The respondents were hired and worked by/for Norkis Trading as skilled workers assigned in the operation of industrial and welding machines owned and used by Norkis Trading for its business, they were not treated as regular employees by Norkis Trading. Instead, they were regarded by Norkis Trading as members of PASAKA, a cooperative, and which was deemed an independent contractor that merely deployed the respondents to render services for Norkis Trading.The respondents,believing that they were regular employees of Norkis Trading, filed on June 9, 1999 with the DOLE a complaint against Norkis Trading and PASAKA for labor-only contracting and nonpayment of minimum wage and overtime pay. The filing of the complaint for labor-only contracting allegedly led to the suspension of the respondents’ membership with PASAKA.On October 13, 1999, the respondents were to report back to work but they were informed by PASAKA that they would be transferred to Norkis Tradings’ sister company, Porta Coeli Industrial Corporation (Porta Coeli). The respondents opposed the transfer as it would allegedly result in a change of employers, from Norkis Trading to Porta Coeli. The respondents also believed that the transfer would result in a demotion since from being skilled workers in Norkis Trading, they would be reduced to being utility workers.These circumstances made the respondents amend their complaint for illegal suspension, to include the charges of unfair labor practice, illegal dismissal, damages and attorney’s fees. ISSUE: Whether the respondents were illegally dismissed by Norkis Trading HELD: YES. Where an entity is declared to be a labor-only contractor, the employees supplied by said contractor to the principal employer become regular employees of the latter. Having gained regular status, the employees are entitled to security of tenure and can only be dismissed for just or authorized causes and after they had been afforded due process. Termination of employment without just or authorized cause and without observing procedural due process is illegal.Considering, that Porta Coeli is an entity separate and distinct from Norkis Trading, the respondents’ employment with Norkis Trading was necessarily severed by the change in work assignment.


FACTS: Solidbank Union and Solidbank negotiated for a new economic package for the remaining two years of the 1997-2001 collective bargaining agreement (CBA). However, the parties reached an impasse. Thus, on January 18, 2000, then Secretary of Labor Bienvenido E. Laguesma (Secretary Laguesma) assumed jurisdiction over the dispute and enjoined the parties from holding a strike or lockout or any activity which might exacerbate the situation. Displeased with Secretary Laguesma’s ruling, members and officers skipped work in the morning of April 3, 2000 and trooped to his office in Intramuros, Manila, not only to accompany their lawyer in filing the Union’s Motion for Reconsideration but also to stage a brief public demonstration. Other rank and file employees in the provincial branches of Solidbank also absented themselves from work that day. Solidbank perceived, themass demonstration conducted by its employees, to be an illegal strike, a deliberate abandonment of work calculated to paralyze its operations. ISSUE: Whether mass demonstration was a legitimate exercise of the constitutional rights to freedom of expression, to peaceful assembly and to petition the government for redress of wrong and not a strike HELD: NO. This issue, however, had already been resolved and passed upon by this Court in its November 15, 2010 Decision in G.R. Nos. 159460 and 159461,which reversed and set aside the March 10, 2003 Decision of the CA’s Twelfth Division in CA-G.R. SP Nos. 67730 and 70820. This Court ruled that complainants’ concerted mass action was actually a strike and not a legitimate exercise of their right to freedom of expression.

De La Salle University vs De La Salle University Employees Association GR 169254 FACTS: This petition involves one of the three notices of strike filed by respondent De La Salle University Employees Association (DLSUEANAFTEU) against petitioner De La Salle University due to its refusal to bargain collectively with it in light of the intra-union dispute between respondent’s two opposing factions. On August 28, 2003, an election of Union officers under the supervision of the DOLE was conducted. The Bañez faction emerged as the winner thereof.The Aliazas faction contested the election results. On March 20, 2001, despite the brewing conflict between the Aliazas and Bañez factions, petitioner entered into a five-year CBA covering the period from June 1, 2000 to May 31, 2005. The Aliazas faction wrote a letter to petitioner requesting it to place in escrow the union dues and other fees deducted from the salaries of employees pending the resolution of the intra-union conflict which was granted. Respondent union asserted that the creation of escrow accounts was not an act of neutrality but was an act of interference with the internal affairs of the union. Labor Arbiter dismissed the complaint for unfair labor practice for lack of merit. The labor arbiter upheld the petitioner's view that there was a void in respondent's leadership. On March 15, 2003, respondent sent a letter to petitioner requesting for the renegotiation of the economic terms for the fourth and fifth years of the then current CBA. On March 20, 2003 petitioner denied respondent’s request saying that No renegotiation can occur given the void in the leadership of [respondent.]. Respondent filed a second notice of strike on April 4 2003. Secretary of Labor assumed jurisdiction and upheld the decision of Labor Arbiter, but finding petitioner guilty of refusing to bargain amounting to unfair labor practice in violation of Article 248(g) in relation to Article 252 of the Labor Code. The issue of union leadership is distinct and separate from the duty to bargain. There is no void in the respondent's leadership. The petitioner is guilty of ULP. Respondent reiterated its demand on petitioner to bargain collectively pursuant to such decision to which petitioner did not accede. On August 27, 2003, respondent filed the third notice of strike citing among others petitioner’s alleged violation of the CBA and continuing refusal to bargain in good faith. The Secretary of Labor again cited the petitioner committed an unfair labor practice.[E]vents have lately turned out in favor of [respondent], thereby obliterating any further justification on the part of [petitioner] not to bargain. On October 29, 2003, the new Regional Director of DOLENCR, Ciriaco E. Lagunzad III, issued a resolution declaring the Bañez group as the duly elected officers of the Union In accordance with the decision, etitioner turned over to respondent the collected union dues and agency fees from employees which were previously placed in escrow. Petitioner filed a petition for certiorari under Rule 65 of Rules of Court with the CA alleging that the Secretary of Labor committed grave abuse of discretion by holding that it (petitioner) was liable for unfair labor practice. CA affirmed decision of Ses of Labor saying that The nonproclamation of the newly elected union officers cannot be used as an excuse to fulfill the duty to bargain collectively ISSUE: Whether of not the petitioner is guilty of Unfair Labor Practice HELD:

the Court of Appeals committed no reversible error in its assailed Decision. The unfair labor practice complaint dismissed by Labor Arbiter Pati questioned petitioner’s actions immediately after the March 19, 2001 Decision of BLR Regional Director Maraan, finding that “the reason for the hold-over [of the previously elected union officers] is already extinguished.” Neither can petitioner seek refuge in its defense that as early as November 2003 it had already released the escrowed union dues to respondent and normalized relations with the latter. The fact remains that from its receipt of the July 28, 2003 Decision of the Secretary of Labor in OS-AJ-0015-2003 until its receipt of the November 17, 2003 Decision of the Secretary of Labor in OS-AJ-0033-2003, petitioner failed in its duty to collectively bargain with respondent union without valid reason.

BILLY M. REALDA vs NEW AGE GRAPHICS, INC. and JULIAN I. MIRASOL, JR. G.R. No. 192190 FACTS: The CA exonerated the petitioner from the charges of destroying Graphics, Inc.’s property and disloyalty to Graphics, Inc. and its objectives. However, the CA ruled that the petitioner’s unjustified refusal to render overtime work, unexplained failure to observe prescribed work standards, habitual tardiness and chronic absenteeism despite warning and non-compliance with the directive for him to explain his numerous unauthorized absences constitute sufficient grounds for his termination. Nonetheless, while the CA recognized the existence of just causes for petitioner’s dismissal, it found the petitioner entitled to nominal damages in the amount of P5,000.00 due to Graphics, Inc.’s failure to observe the procedural requirements of due process. ISSUE: Whether or not the dismissal of the employee was proper and based on just cause HELD: YES This Court finds no cogent reason to reverse the assailed issuances of the CA. First, the petitioner’s arbitrary defiance to Graphics, Inc.’s order for him to render overtime work constitutes willful disobedience. Second, the petitioner’s failure to observe Graphics, Inc.’s work standards constitutes inefficiency that is a valid cause for dismissal. As the operator of Graphics, Inc.’s printer, he is mandated to check whether the colors that would be printed are in accordance with the client’s specifications and for him to do so, he must consult the General Manager and the color guide used by Graphics, Inc. before making a full run. Unfortunately, he failed to observe this simple procedure and proceeded to print without making sure that the colors were at par with the client’s demands The procedure laid down by Graphics, Inc. which the petitioner was bound to observe does not appear to be unreasonable or unnecessarily difficult. Undoubtedly, Graphics, Inc. complied with the substantive requirements of due process in effecting employee dismissal. However, the same cannot be said insofar as the procedural requirements are concerned. As correctly observed by the CA, Graphics, Inc. failed to afford the petitioner with a reasonable opportunity to be heard and defend itself. An administrative hearing set on the same day that the petitioner received the memorandum and the twenty-four (24) – hour period for him to submit a written explanation are far from being reasonable. there is no indication that Graphics, Inc. issued a second notice, informing the petitioner of his dismissal. Nonetheless, while the CA finding that the petitioner is entitled to nominal damages as his right to procedural due process was not respected despite the presence of just causes for his dismissal is affirmed, this Court finds the CA to have erred in fixing the amount that the Company is liable to pay. The CA should have taken cognizance of the numerous cases decided by this Court where the amount of nominal damages was fixed at P30,000.00 if the dismissal was for a just cause.

C. Alcantara & Sons, Inc. vs Court of Appeals, et al. March 14, 2012 G.R. No. 155109 FACTS: The negotiation between CASI and the Union on the economic provisions of the Collective Bargaining Agreement (CBA) ended in a deadlock prompting the Union to stage a strike,[7] but the strike was later declared by the Labor Arbiter (LA) to be illegal having been staged in violation of the CBA’s no strike-no lockout provision.[8] Consequently, the Union officers were deemed to have forfeited their employment with the company and made them liable for actual damages plus interest and attorney’s fees, while the Union members were ordered to be reinstated without backwages there being no proof that they actually committed illegal acts during the strike.[9] Notwithstanding the provision of the Labor Code mandating that the reinstatement aspect of the decision be immediately executory, the LA refused to reinstate the dismissed Union members. On November 8, 1999, the NLRC affirmed the LA decision insofar as it declared the strike illegal and ordered the Union officers dismissed from employment and liable for damages but modified the same by considering the Union members to have been validly dismissed from employment for committing prohibited and illegal acts.[10] On petition for certiorari, the Court of Appeals (CA) annulled the NLRC decision and reinstated that of the LA. Aggrieved, CASI, the Union and the Union officers and members elevated the matter to this Court The union members who were reinstated filed for the computation of their back wages but the LA award only separation pay. On appeal, the NLRC denied the union's claims. The CA held that reinstatement pending appeal applies only to illegal dismissal cases under Article 223 of the Labor Code and not to cases under Article 263. ISSUE: Whether or not the union members commission of prohibited acts tantamounts to a valid dismissal HELD: YES The Court agreed with the CA on the illegality of the strike as well as the termination of the Union officers, but disagreed with the CA insofar as it affirmed the reinstatement of the Union members. The Court, instead, sustained the dismissal not only of the Union officers but also the Union members who, during the illegal strike, committed prohibited acts by threatening, coercing, and intimidating non-striking employees, officers, suppliers and customers; obstructing the free ingress to and egress from the company premises; and resisting and defying the implementation of the writ of preliminary injunction issued against the strikers. The terminated employees who should have been reinstated immediately should be awarded their accrued backwages from the date of the LA decision until the eventual reversal by the NLRC of the order of reinstatement plus separation pay. Article 264 (a) of the Labor Code lays down the liabilities of the Union officers and members participating in illegal strikes and/or committing illegal acts, to wit: ART. 264. PROHIBITED ACTIVITIES (a) x x x

(b) Any worker whose employment has been terminated as a consequence of an unlawful lockout shall be entitled to reinstatement with full backwages. Any Union officer who knowingly participates in an illegal strike and any worker or Union officer who knowingly participates in the commission of illegal acts during a strike may be declared to have lost his employment status: Provided, That mere participation of a worker in a lawful strike shall not constitute sufficient ground for termination of his employment, even if a replacement had been hired by the employer during such lawful strike. Not only did the Court declare the strike illegal, rather, it also found the Union officers to have knowingly participated in the illegal strike. Worse, the Union members committed prohibited acts during the strike The award of separation pay as a form of financial assistance is deleted.

Eden Gladys Abaria,et al. vs NLRC, et al. December 7, 2011 G.R. No. 15411 FACTS: Metro Cebu Community Hospital, Inc. (MCCHI), presently known as the Visayas Community Medical Center (VCMC). is owned by the United Church of Christ in the Philippines (UCCP) and Rev. Gregorio P. Iyoy is the Hospital Administrator. The National Federation of Labor (NFL) is the exclusive bargaining representative of the rank-andfile employees of MCCHI. On December 6, 1995, the union expressed desire to renew the CBA. Atty. Alforque, NFL’s Regional Director suspended union membership of some for serious violation of the Constitution and By-Laws. On February 26, 1996, upon the request of Atty. Alforque, MCCHI granted one-day union leave with pay for 12 union members.[5] The next day, several union members led by Nava and her group launched a series of mass actions such as wearing black and red armbands/headbands, marching around the hospital premises and putting up placards, posters and streamers. MCCHI directed the union officers led by Nava to submit within 48 hours a written explanation why they should not be terminated for having engaged in illegal concerted activities amounting to strike, and placed them under immediate preventive suspension. Responding to this directive, Nava and her group denied there was a temporary stoppage of work, explaining only reiterating their demand for MCCHI to comply with its duty to bargain collectively. Union officers were ordered to appear for investigation in connection with the illegal strike wherein they reportedly uttered slanderous and scurrilous words against the officers of the hospital, threatening other workers and forcing them to join the strike. Said union officers, however, invoked the grievance procedure provided in the CBA With the volatile situation adversely affecting hospital operations and the condition of confined patients, MCCHI filed a petition for injunction in the NLRC to which a TRO was issued. Thereafter, several complaints for illegal dismissal and unfair labor practice were filed by the terminated employees. The complaints for ULP were dismissed. Executive Labor Arbiter Belarmino found no basis for the charge of unfair labor practice and declared the strike and picketing activities illegal having been conducted by NAMA-MCCH-NFL which is not a legitimate labor organization. The termination of union leaders Nava, Alsado, Bañez, Bongcaras, Canen, Gerona and Remocaldo were upheld as valid but MCCHI was directed to grant separation pay equivalent to one-half month for every year of service NLRC denied complainants’ motion for reconsideration. CA reversed the assailed decision. In G.R. No. 187778, petitioners Nava, et al. prayed that the CA decision be set aside and a new judgment be entered by this Court (1) declaring private respondents guilty of unfair labor practice and union busting; (2) directing private respondents to cease and desist from further committing unfair labor practices against the petitioners; (3) imposing upon MCCH the proposed CBA or, in the alternative, directing the hospital and its officers to bargain with the local union; (4) declaring private respondents guilty of unlawfully suspending and illegally dismissing the individual petitionersemployees; (5) directing private respondents to reinstate petitioners-employees to their former positions, or their

equivalent, without loss of seniority rights with full backwages and benefits until reinstatement; and (6) ordering private respondents to pay the petitioners moral damages, exemplary damages, legal interests, and attorney’s fees ISSUE: whether MCCHI is guilty of unfair labor practice; HELD: MCCHI not guilty of unfair labor practice Art. 248 (g) of the Labor Code, as amended, makes it an unfair labor practice for an employer “*t+o violate the duty to bargain collectively” as prescribed by the Code. The applicable provision in this case is Art. 253 which provides: ART. 253. Duty to bargain collectively when there exists a collective bargaining agreement. – When there is a collective bargaining agreement, the duty to bargain collectively shall also mean that neither party shall terminate nor modify such agreement during its lifetime. However, either party can serve a written notice to terminate or modify the agreement at least sixty (60) days prior to its expiration date. It shall be the duty of both parties to keep the status quo and to continue in full force and effect the terms and conditions of the existing agreement during the 60-day period and/or until a new agreement is reached by the parties. Records of the NCMB and DOLE Region 7 confirmed that NAMA-MCCH-NFL had not registered as a labor organization, having submitted only its charter certificate as an affiliate or local chapter of NFL.[37] Not being a legitimate labor organization, NAMA-MCCH-NFL is not entitled to those rights granted to a legitimate labor organization under Art. 242, specifically: (a) To act as the representative of its members for the purpose of collective bargaining; (b) To be certified as the exclusive representative of all the employees in an appropriate collective bargaining unit for purposes of collective bargaining; Aside from the registration requirement, it is only the labor organization designated or selected by the majority of the employees in an appropriate collective bargaining unit which is the exclusive representative of the employees in such unit for the purpose of collective bargaining, as provided in Art. 255.[38] NAMA-MCCH-NFL is not the labor organization certified or designated by the majority of the rank-and-file hospital employees to represent them in the CBA negotiations but the NFL, as evidenced by CBAs concluded in 1987, 1991 and 1994. While it is true that a local union has the right to disaffiliate from the national federation, NAMA-MCCH-NFL has not done so as there was no any effort on its part to comply with the legal requisites for a valid disaffiliation during the “freedom period”[39] or the last 60 days of the last year of the CBA, through a majority vote in a secret balloting in accordance with Art. 241 (d).[40] Nava and her group simply demanded that MCCHI directly negotiate with the local union which has not even registered as one. NAMA-MCCH-NFL at the time of submission of said proposals was not a duly registered labor organization, hence it cannot legally represent MCCHI’s rank-and-file employees for purposes of collective bargaining. Hence, even assuming that NAMA-MCCH-NFL had validly disaffiliated from its mother union, NFL, it still did not possess the legal personality to enter into CBA negotiations. A local union which is not independently registered cannot, upon disaffiliation from the federation, exercise the rights and privileges granted by law to legitimate labor organizations; thus, it cannot file a petition for certification election

Not being a legitimate labor organization nor the certified exclusive bargaining representative of MCCHI’s rankand-file employees, NAMA-MCCH-NFL cannot demand from MCCHI the right to bargain collectively in their behalf.[45] Hence, MCCHI’s refusal to bargain then with NAMA-MCCH-NFL cannot be considered an unfair labor practice to justify the staging of the strike

KAISAHAN AT KAPATIRAN NG MGA MANGGAGAWA AT KAWANI SA MWC-EAST ZONE UNION and EDUARDO BORELA, representing its members,- vs -MANILA WATER COMPANY, INC., G.R. No. 174179 November 16, 2011 FACTS: The Union is the duly-recognized bargaining agent of the rank-and-file employees of the respondent Manila Water Company, Inc. (Company) while Borela is the Union President On February 21, 1997, the Metropolitan Waterworks and Sewerage System (MWSS) entered into a Concession Agreement (Agreement) with the Company to privatize the operations of the MWSS. in 2001, the Union demanded from the Company the payment of the AA and the COLA during the renegotiation of the parties’ Collective Bargaining Agreement (CBA).[10] The Company initially turned down this demand, however, it subsequently agreed to an amendment of the CBA on the matter. Commission on Audit disapproved its payment because the Company had no funds to cover this benefit causing a complaint against the Company for payment. LA ruled in favor of the petitioners and ordered the payment of their AA and COLA. NLRC affirmed with modification the LA’s decision.[15] It set aside the award of the COLA benefits because the claim was not proven and established, but ordered the Company to pay the petitioners their accrued AA of aboutP107,300,000.00 in lump sum and to continue paying the AA starting August 1, 2002. The CA ruled that the facts of the case do not indicate any unlawful withholding of wages or bad faith attributable to the Company. It also held that the additional grant of 10% attorney’s fees violates Article 111 of the Labor Code considering that the MOA between the parties already ensured the payment of 10% attorney’s fees, deductible from the AA and CBA receivables of the Union’s members. The CA thus adjudged the NLRC decision awarding attorney’s fees to have been rendered with grave abuse of discretion. Company argues that the CA correctly ruled that the NLRC acted with grave abuse of discretion when it affirmed the LA’s award of attorney’s fees despite the absence of a finding of any unlawful withholding of wages or bad faith on the part of the Company. ISSUE: whether the NLRC gravely abused its discretion in awarding ten percent (10%) attorney’s fees to the petitioners HELD: Article 111 of the Labor Code, as amended, governs the grant of attorney’s fees in labor cases: Art. 111. Attorney’s fees.- (a) In cases of unlawful withholding of wages, the culpable party may be assessed attorney’s fees equivalent to ten percent of the amount of wages recovered.

(b) It shall be unlawful for any person to demand or accept, in any judicial or administrative proceedings for the recovery of wages, attorney’s fees which exceed ten percent of the amount of wages recovered.

Section 8, Rule VIII, Book III of its Implementing Rules also provides, viz.: Section 8. Attorney’s fees. – Attorney’s fees in any judicial or administrative proceedings for the recovery of wages shall not exceed 10% of the amount awarded. The fees may be deducted from the total amount due the winning party. In its ordinary concept, an attorney’s fee is the reasonable compensation paid to a lawyer by his client for the legal services the former renders; compensation is paid for the cost and/or results of legal services per agreement or as may be assessed. In its extraordinary concept, attorney’s fees are deemed indemnity for damages ordered by the court to be paid by the losing party to the winning party. We also held in PCL Shipping that Article 111 of the Labor Code, as amended, contemplates the extraordinary concept of attorney’s fees and that Article 111 is an exception to the declared policy of strict construction in the award of attorney’s fees. Although an express finding of facts and law is still necessary to prove the merit of the award, there need not be any showing that the employer acted maliciously or in bad faith when it withheld the wages. The award of attorney’s fees is proper, and there need not be any showing that the employer acted maliciously or in bad faith when it withheld the wages. There need only be a showing that the lawful wages were not paid accordingly the CA erred in ruling that a finding of the employer’s malice or bad faith in withholding wages must precede an award of attorney’s fees under Article 111 of the Labor Code. To reiterate, a plain showing that the lawful wages were not paid without justification is sufficient. In the present case, we find it undisputed that the union members are entitled to their AA benefits and that these benefits were not paid by the Company. That the Company had no funds is not a defense as this was not an insuperable cause that was cited and properly invoked. As a consequence, the union members represented by the Union were compelled to litigate and incur legal expenses. On these bases, we find no difficulty in upholding the NLRC’s award of ten percent (10%) attorney’s fees. In the present case, the ten percent (10%) attorney’s fees awarded by the NLRC on the basis of Article 111 of the Labor Code accrue to the Union’s members as indemnity for damages and not to the Union’s counsel as compensation for his legal services, unless, they agreed that the award shall be given to their counsel as additional or part of his compensation; in this case the Union bound itself to pay 10% attorney’s fees to its counsel under the MOA and also gave up the attorney’s fees awarded to the Union’s members in favor of their counsel. The limit to this agreement is that the indemnity for damages imposed by the NLRC on the losing party (i.e., the Company) cannot exceed ten percent the attorney’s fees contracted under the MOA do not refer to the amount of attorney’s fees awarded by the NLRC; the MOA provision on attorney’s fees does not have any bearing at all to the attorney’s fees awarded by the NLRC under Article 111 of the Labor Code. Based on these considerations, it is clear that the CA erred in ruling that the LA’s award of attorney’s fees violated the maximum limit of ten percent (10%) fixed by Article 111 of the Labor Code.

BANK OF THE PHILIPPINE ISLANDS vs. BPI EMPLOYEES UNION-DAVAO CHAPTER-FEDERATION OF UNIONS IN BPI UNIBANK G.R. No. 164301 October 19, 2011 FACTS: Petitioner Bank of the Philippine Islands (BPI) moves for reconsideration holding that former employees of the Far East Bank and Trust Company (FEBTC) "absorbed" by BPI pursuant to the two banks’ merger were covered by the Union Shop Clause in the then existing collective bargaining agreement of BPI with respondent union. The Union Shop Clause: Section 2. Union Shop - New employees falling within the bargaining unit as defined in Article I of this Agreement, who may hereafter be regularly employed by the Bank shall, within thirty (30) days after they become regular employees, join the Union as a condition of their continued employment. It is understood that membership in good standing in the Union is a condition of their continued employment with the Bank. BPI continues to protest the inclusion of FEBTC employees in the Union Shop Clause. BPI insists that the parties to the CBA clearly intended to limit the application of the Union Shop Clause only to new employees who were hired as non-regular employees but later attained regular status at some point after hiring. FEBTC employees cannot be considered new employees as BPI merely stepped into the shoes of FEBTC as an employer purely as a consequence of the merger. Union's comment on the Motion for Reconsideration states the voluntary nature of the merger between BPI and FEBTC, the lack of an express stipulation in the Articles of Merger regarding the transfer of employment contracts to the surviving corporation, and the consensual nature of employment contracts as valid bases for the conclusion that former FEBTC employees should be deemed new employees.The Union argues that the creation of employment relations between former FEBTC employees and BPI occurred after the merger, or to be more precise, after the SEC's approval of the merger. ISSUES: 1. Whether or not the "absorbed" FEBTC employees fell within the definition of "new employees" under the Union Shop Clause, such that they may be required to join respondent union and if they fail to do so, the Union may request BPI to terminate their employment. 2. Whether or not the affirmance of the ruling that former FEBTC employees absorbed by BPI are covered by the Union Shop Clause violate their right to security of tenure. HELD: 1. YES

The Union Shop Clause in the CBA simply states that "new employees" who during the effectivity of the CBA "may be regularly employed" by the Bank must join the union within thirty (30) days from their regularization. There is nothing in the said clause that limits its application to only new employees who possess non-regular

status, meaning probationary status, at the start of their employment. Petitioner likewise failed to point to any provision in the CBA expressly excluding from the Union Shop Clause new employees who are "absorbed" as regular employees from the beginning of their employment. What is indubitable from the Union Shop Clause is that upon the effectivity of the CBA, petitioner's new regular employees, regardless of the manner by which they became employees of BPI, are required to join the Union as a condition of their continued employment. Ordinary meaning of the terms of the Union Shop Clause, it covers employees who (a) enter the employ of BPI during the term of the CBA; (b) are part of the bargaining unit defined in the CBA as comprised of BPI’s rank and file employees; and (c) become regular employees without distinguishing as to the manner theyacquire their regular status. 2. No. It is the policy of the state to assure the right of workers to security of tenure. The guarantee is an act of social justice. Article 280 of the Labor Code has construed security of tenure as meaning that the employer shall not terminate the services of an employee except for a just cause or when authorized by the Code. It is State policy to promote unionism to enable workers to negotiate with management on an even playing field and with more persuasiveness than if they were to individually and separately bargain with the employer. The law has allowed stipulations for 'union shop' and 'closed shop' as means of encouraging workers to join and support the union of their choice in the protection of their rights and interests vis-a-vis the employer. The dismissal should not be done hastily and summarily thereby eroding the employees' right to due process, selforganization and security of tenure. The enforcement of union security clauses is authorized by law provided such enforcement is not characterized by arbitrariness, and always with due process.

MAGDALA MULTIPURPOSE & LIVELIHOOD COOPERATIVE and SANLOR MOTORS CORP., vs. KILUSANG MANGGAGAWA NG LGS, MAGDALA MULTIPURPOSE & LIVELIHOOD CORPERATIVE (KMLMS) and UNION MEMBERS/ STRIKERS G.R. Nos. 191138-39 October 19, 2011 FACTS: KMLMS filed a notice of strike on March 5, 2002 and conducted its strike-vote on April 8, 2002. However, KMLMS only acquired legal personality when its registration as an independent labor organization was granted on April 9, 2002 by the Department of Labor and Employment. On April 19, 2002, it became officially affiliated as a local chapter of the Pambansang Kaisahan ng Manggagawang Pilipino when its application was granted by the Bureau of Labor Relations. On May 6, 2002, KMLMS, now a legitimate labor organization (LLO), staged a strike where several prohibited and illegal acts were committed by its participating members. On the ground of lack of valid notice of strike, ineffective conduct of a strike-vote and commission of prohibited and illegal acts, petitioners filed their Petition to Declare the Strike of May 6, 2002 Illegal before the NLRC. Petitioners prayed, inter alia, that the officers and members of respondent KMLMS who participated in the illegal strike and who knowingly committed prohibited and illegal activities, respectively, be declared to have lost or forfeited their employment status. On the ground of non-compliance with the strict and mandatory requirements for a valid conduct of a strike under Article 263(c), (d) and (f) of the Labor Code and Rule XXII, Book V of the Omnibus Rules Implementing the Labor Code, LA Aglibut found the May 6, 2002 strike illegal and accordingly dismissed all the 14 union officers of KMLMS. LA Aglibut likewise found 27 identified members of KMLMS to have committed prohibited and illegal acts proscribed under Art. 264 of the Labor Code and accordingly declared them to have forfeited their employment. Both parties appealed the Decision of LA Aglibut before the NLRC NLRC affirmed with modification LA Aglibut’s Decision by declaring an additional seven (7) union members to have forfeited their employment status. Both parties again filed their respective appeals before the CA. CA affirmed the NLRC decision. Petitioners prayed to SC for a partial modification of the assailed CA Decision by declaring additional 72 similarly erring KMLMS members to have lost their employment. ISSUE: Whether or not the CA erred in refusing to similarly declare as having lost their employment status the rest of the union strikers who have participated in the illegal strike and commited prohibited / illegal acts, to the prejudice of petitioner's business operations. HELD:

There is no question that the May 6, 2002 strike was illegal, first, because when KMLMS filed the notice of strike, it had not yet acquired legal personality and, thus, could not legally represent the eventual union and its members. And second, similarly when KMLMS conducted the strike-vote, there was still no union to speak of, since KMLMS only acquired legal personality as an independent LLO only on the day after it conducted the strike-vote. These factual findings are undisputed and borne out by the records. Consequently, the mandatory notice of strike and the conduct of the strike-vote report were ineffective for having been filed and conducted before KMLMS acquired legal personality as an LLO, violating Art. 263(c), (d) and (f) of the Labor Code and Rule XXII, Book V of the Omnibus Rules Implementing the Labor Code. When the May 6, 2002 illegal strike was conducted, the members of respondent KMLMS committed prohibited and illegal acts which doubly constituted the strike illegal. Proper sanctions for the conduct of union officers in an illegal strike and for union members who committed illegal acts during a strike. Art. 264 of the Code presents a substantial distinction of the consequences of an illegal strike between union officers and mere members of the union. For union officers, knowingly participating in an illegal strike is a valid ground for termination of their employment. But for union members who participated in a strike, their employment may be terminated only if they committed prohibited and illegal acts during the strike and there is substantial evidence or proof of their participation, that they are clearly identified to have committed such prohibited and illegal acts. The petitioners have substantially proved the identity of 72 other union members who committed prohibited and illegal acts during the May 6, 2002 illegal strike. Thus, the 72 union members who committed prohibited and illegal acts during the May 6, 2002 strike are also declared to have forfeited their employment.

SAN MIGUEL FOODS, INCORPORATED vs. SAN MIGUEL CORPORATION SUPERVISORS and EXEMPT UNION G.R. No. 146206 August 1, 2011 FACTS: DOLE-NCR conducted pre-election conferences. However, there was a discrepancy in the list of eligible voters. Petitioner submitted a list of 23 employees for the San Fernando plant and 33 for the Cabuyao plant, while respondent listed 60 and 82, respectively. The Med-Arbiter issued an order directing the Election Officer to proceed with the conduct of Certification Election. On the date of the election, petitioner filed the Omnibus Objections and Challenge to Voters, questioning the eligibility to vote by some of its employees on the grounds that some employees do not belong to the bargaining unit which respondent seeks to represent or that there is no existence of employer-employee relationship with petitioner. Specifically, it argued that certain employees should not be allowed to vote as they are: (1) confidential employees; (2) employees assigned to the live chicken operations, which are not covered by the bargaining unit; (3) employees whose job grade is level 4, but are performing managerial work and scheduled to be promoted; (4) employees who belong to the Barrio Ugong plant; (5) non-SMFI employees; and (6) employees who are members of other unions. The CE was conducted. Based on the results, Med-Arbiter issued an order stating respondent is certified to be the exclusive bargaining agent of the supervisors and exempt employees of petitioner's Magnolia Poultry Products Plants in Cabuyao, San Fernando, and Otis. Petitioner contends that identifying the specific employees who can participate in the certification election, the supervisors (levels 1 to 4) and exempt employees of San Miguel Poultry Products Plants in Cabuyao, San Fernando, and Otis, the CA erred in expanding the scope of the bargaining unit so as to include employees who do not belong to or who are not based in its Cabuyao or San Fernando plants. It also alleges that the employees of the Cabuyao, San Fernando, and Otis plants of petitioner’s predecessor, San Miguel Corporation, were engaged in "dressed" chicken processing, like handling and packaging of chicken meat, while the new bargaining unit, includes employees engaged in "live" chicken operations, such as those who breed chicks and grow chickens. ISSUE: Whether or not petitioner's contention is correct. HELD: No. Employees of San Miguel Corporation Magnolia Poultry Products Plants of Cabuyao, San Fernando, and Otis constitute a single bargaining unit, which is not contrary to the one-company, one-union policy. An appropriate bargaining unit is defined as a group of employees of a given employer, comprised of all or less than all of the entire body of employees, which the collective interest of all the employees, consistent with equity to the employer, indicate to be best suited to serve the reciprocal rights and duties of the parties under the collective bargaining provisions of the law.

Under the "community or mutuality of interests" test, It held that while the existence of a bargaining history is a factor that may be reckoned with in determining the appropriate bargaining unit, the same is not decisive or conclusive. Other factors must be considered. The test of grouping is community or mutuality of interest. This is so because the basic test of an asserted bargaining unit’s acceptability is whether or not it is fundamentally the combination which will best assure to all employees the exercise of their collective bargaining rights. There may be differences as to the nature of their individual assignments, but the distinctions are not enough to warrant the formation of a separate bargaining unit. Applying the ruling to the present case, SC affirms the finding of the CA that there should be only one bargaining unit for the employees in Cabuyao, San Fernando, and Otis of Magnolia Poultry Products Plant involved in "dressed" chicken processing and Magnolia Poultry Farms engaged in "live" chicken operations. Certain factors, such as specific line of work, working conditions, location of work, mode of compensation, and other relevant conditions do not affect or impede their commonality of interest. Although they seem separate and distinct from each other, the specific tasks of each division are actually interrelated and there exists mutuality of interests which warrants the formation of a single bargaining unit.

ELECTROMAT MANUFACTURING and RECORDING CORPORATION vs. HON. CIRIACO LAGUNZAD G.R. No. 172699 July 27, 2011 FACTS: The private respondent Nagkakaisang Samahan ng Manggagawa ng Electromat-Wasto (union), a charter affiliate of the Workers Advocates for Struggle, Transformation and Organization (WASTO), applied for registration with the BLR. Supporting the application were the following documents: (1) copies of its ratified constitution and bylaws (CBL); (2) minutes of the CBL’s adoption and ratification; (3) minutes of the organizational meetings; (4) names and addresses of the union officers; (5) list of union members; (6) list of rank-and-file employees in the company; (7) certification of non-existence of a collective bargaining agreement (CBA) in the company; (8) resolution of affiliation with WASTO, a labor federation; (9) WASTO’s resolution of acceptance; (10) Charter Certificate; and (11) Verification under oath. The BLR thereafter issued the union a Certification of Creation of Local Chapter, equivalent to the certificate of registration of an independent union, pursuant to Department Order No. (D.O.) 40-03. Petitioner Electromat Manufacturing and Recording Corporation (company) filed a petition for cancellation of the union’s registration certificate, for the union’s failure to comply with Article 234 of the Labor Code. It argued that D.O. 40-03 is an unconstitutional diminution of the Labor Code’s union registration requirements under Article 234. DOLE-NCR dismissed the petition. BLR affirmed the dismissal. Company sought relief from the CA through a petition for certiorari, contending that the BLR committed grave abuse of discretion in affirming the union’s registration despite its non-compliance with the requirements for registration under Article 234 of the Labor Code. It assailed the validity of D.O. 40-03 which amended the rules of Book V (Labor Relations) of the Labor Code. CA dismissed the petition and affirmed the decision of BLR. ISSUE: Whether or not therespondent union was validly registered in accordance with the Labor Code. HELD: Yes The local union in the present case has more than satisfied the requirements the petitioner complains about; specifically, the union has submitted: (1) copies of the ratified CBL; (2) the minutes of the CBL’s adoption and ratification; (3) the minutes of the organizational meetings; (4) the names and addresses of the union officers; (5) the list of union members; (6) the list of rank-and-file employees in the company; (7) a certification of nonexistence of aCBA in the company; (8) the resolution of affiliation with WASTO and the latter’s acceptance; and (9) their Charter Certificate. These submissions were properly verified as required by the rules. In sum, the petitioner has no factual basis for questioning the union’s registration, as even the requirements for registration as an independent local have been substantially complied with.

D.O. 40-03 represents an expression of the government’s implementing policy on trade unionism. SC finds nothing contrary to the law or the Constitution in the adoption by the Secretary of Labor and Employment of D.O. 40-03 as this department order is consistent with the intent of the government to encourage the affiliation of a local union with a federation or national union to enhance the local’s bargaining power. If changes were made at all, these were those made to recognize the distinctions made in the law itself between federations and their local chapters, and independent unions; local chapters seemingly have lesser requirements because they and their members are deemed to be direct members of the federation to which they are affiliated, which federations are the ones subject to the strict registration requirements of the law.

Automotive Engine Rebuilders, Inc. (AER), et al. Vs. Progresibong Unyon Ng Mga Manggagawa sa AER, et al. G.R. No. 160138 July 13, 2011 FACTS: According to the Union, when the management learned that the workers began organizing themselves into a union and received summons regarding the petition for certification election filed by the employees, they retaliated by causing the employees to submit themselves to drug test, and when the results were positive, they were suspended. When the Union sensed that management was going to engage in a runaway shop, it tried to prevent the transfer of the machines which prompted AER to issue a memorandum accusing those involved of gross insubordination, work stoppage and other offenses. After being denied entry into the premises, the affected workers staged a picket in front of company premises hoping that management would accept them back to work. When their picket proved futile, they filed a complaint for ULP, illegal suspension and illegal dismissal. The LA that both parties were in pari delicto and, therefore, must suffer the consequences of the wrong they committed. On appeal by both parties to NLRC, it found that there was no illegal dismissal. On petition, both parties were found by the CA to be in pari delicto and must bear the consequences of their own wrongdoing. On reconsideration, the CA ordered the reinstatement of the petitioners without back wages. Botheparties filed the consolidated petition with the SC. ISSUE: WON the CA erred in ruling for the reinstatement of the complaining employees but without grant of backwages. RULING: This Court likewise affirms the ruling of the CA favoring the reinstatement of all the complaining employees including those who tested positive for illegal drugs, without backwages. The Court is in accord with the ruling of the LA and the CA that neither party came to court with clean hands. Both were in pari delicto. It cannot be disputed that both parties filed charges against each other, blaming the other party for violating labor laws. AER filed a complaint against Unyon and its 18 members for illegal concerted activities. It likewise suspended 7 union members who tested positive for illegal drugs. On the other hand, Unyon filed a countercharge accusing AER of unfair labor practice, illegal suspension and illegal dismissal. In other words, AER claims that Unyon was guilty of staging an illegal strike while Unyon claims that AER committed an illegal lockout. In the case at bar, since both AER and the union are at fault or in pari delicto, they should be restored to their respective positions prior to the illegal strike and illegal lockout.

General Milling Corporation-Independent Labor Union (GMC-ILU), petitioner vs. General Milling Corporation, respondent GR. No. 183122, June 15, 2011 FACTS: On April 28, 1989, GMC and the Union entered into a CBA which provided the latter’s representation of the collective bargaining unit for a 3-year term made to retroact to December 1, 1988. One day before the expiration of the CBA, the Union sent a draft CBA proposal to GMC with a request for counter-proposals for the purpose of renegotiating the existing CBA between the parties. The GMC failed to comply with the said request, the Union commenced the complaint to the Regional Arbitration Branch- VII of the NLRC for unfair labor practice but was th dismissed for lack of merit. On appeal, the dismissal was reversed and set aside by the 4 Division of the NLRC. Union filed a petition for certiorari before the CA which favoured the former. They held that GMC’s refusal to make a counter proposal to the union’s proposal for CBA negotiation is an indication of its bad faith. Where the employer did not even bother to submit an answer to the bargaining proposals of the union, there is a clear evasion of the duty to bargain collectively. With the ensuing finality of the foregoing decision, the Union filed a motion for issuance of a writ of execution to enforce the claims of the covered employees. However, the Union was dissatisfied to the computation of the Executive Labor Arbiter of the claims. Both respondent filed a petitions for certiorari to the CA. Acknowledging the difficulty of computing the benefits demanded by the Union in the absence of evidence upon which to base the same, the CA referred the case to the Grievance Machinery under the imposed CBA. On the other hand, GMC’s petition was dismissed for lack of merit. ISSUE: WON the grievance machinery of the imposed CBA is proper in determining the benefits or claims of the Union. HELD: The extent of the benefits after the expiration of the term of the parties’ original CBA as well as the identity of the employees entitled will be better and more thoroughly threshed out by the parties themselves in accordance with the grievance procedure outlined in Article XII of the imposed CBA. Aside from being already beyond the scope of the decision sought to be enforced, these matters will not be accurately ascertained from the summaries of claims the parties have been wont to submit at the pre-execution conference conducted a quo. Taking into consideration such factors as hiring new employees, personnel movement and/or promotions as well as separations from employment which may have, in the meantime, occurred after the expiration of the remaining term of the original CBA, the identity of the covered employees as well as the extent of the benefits due to them should clearly be reckoned from acquisition and until loss of their status as regular monthly paid employees. Since the computation must likewise necessarily take into consideration the increase in salaries and benefits that may have been given in the intervening period, both GMC and the Union are enjoined to make the pertinent employment and company records available to each other, to facilitate the accurate determination of said benefits.

Yolito Fadriquelan, Arturo Eguna, Armando Malaluan, Danilo Alonzo, Romulo Dimaano, Roel Mayuga, Wilfredo Rizaldo, Romeo Suico, Domingo Escamillas and Domingo Bautro, petitioners VS. Monterey Foods Corporation, respondents GR No. 178409, June 8, 2011 FACTS: On April 30, 2002, the CBA between the union Bukluran ng Manggagawa sa Monterey-Ilaw at Buklod ng Manggagawa and Monterey Foods Corporation (the company) expired. On March 28, 2003 after the negotiation for a new CBA reached a deadlock, the union filed a notice of strike with the NCMB. On April 30, 2003, the company filed with the DOLE a petition for assumption of jurisdiction over the dispute to head off the strike. The DOLE Secretary, in its May 12, 2003 order, assumed the jurisdiction over the dispute and enjoined the union from holding any strike. On May 21, 2003, the union filed a second notice of strike before the NCMB on the ground that the company committed unfair labor practices. On June 10, 2003 the company sent notices to the union officers charging them with intentional acts of slowdown. Six days later, the company sent new notices to the union officers, informing them of their termination from work for defying the DOLE Secretary’s assumption order. The Secretary included the union’s second notice of strike in his earlier assumption order but on the same day, the union filed a third notice of strike on the ground that the company had engaged in union busting and illegal dismissal of union officers. The company then filed a petition for certification of the labor dispute to the NLRC for compulsory arbitration but the DOLE Secretary denied the motion. He, however subsumed the third notice of strike under the first and second notices. On November 20, 2003 the DOLE upheld the company’s termination of the union officers. The union and its officers appealed to the CA. The CA rendered a decision upholding the validity of the termination of 10 union officers but declaring illegal that of the other 7. Hence this petition. ISSUE: WON the CA erred in holding that slowdowns actually transpired at the company’s farms. HELD: Yes. The law is explicit; no strike shall be declared after the Secretary of Labor has assumed jurisdiction over a labor dispute. A strike conducted after such assumption is illegal and any union officer who knowingly participates in the same be declared as having lost his employment. In this case, what is involved is a slowdown strike. Unlike other forms of strike, the employees involved in a slowdown do not walk out of their jobs. They need only to stop work or reduce the rate of their work while generally remaining in their assigned post. The evidence sufficiently shows that the union officers and members simultaneously stopped work at the company’s farms. The union’s contention that it merely held assemblies to inform members of the developments in the CBA negotiation and not protest demonstrations over it is unmeritorious. As the CA correctly observed, if the meetings had already been for the stated reason, why did the union members and officers from separate company farms choose to start and end their meetings at the same time and on the same day? And if they did not intend a slowdown, why did they not hold their meetings after work.

Airline Pilots Association of the Philippines, petitioner vs. Philippine Airlines, Inc., respondent GR No. 168383, June 6, 2011 FACTS: Petitioner ALPAP is a legitimate labor organization and exclusive bargaining agent of all commercial pilots of PAL. Claiming that PAL committed unfair labor practice, the union filed a notice of strike against PAL with the DOLE. Upon PAL’s petition and considering that its continued operation is impressed with public interest, the DOLE Secretary assumed jurisdiction over the labor dispute per order dated December 23, 1997. The order provides that all strikes and lockouts at the PAL, whether actual or impending, are prohibited and the parties are enjoined from committing any act that may exacerbate the situation. Despite such order, ALPAP went on strike on June 5, 1998 but the DOLE issue a return-to-work order on June 7, 1998. However, it was only on June 26, 1998 when ALPAP officers and members reported back to work as shown in a logbook signed by each of them. With this, PAL refused to accept the returning pilots for their failure to comply immediately with the return-to-work order. ALPAP then filed a complaint for illegal lockout against PAL to the Labor Arbiter. They contended that their counsel received a copy of the return-to-work order only on June 25, 1998. On PAL’s motion, the Labor Arbiter consolidated the illegal lockout case pending before the DOLE Secretary since the controversy presented in the lockout case is an offshoot of the labor dispute over which the DOLE Secreatry has assumed jurisdiction. In a resolution, the NLRC sustained the consolidation of the illegal lockout case with the strike case, opining that the DOLE Secretary has the authority to resolve all incidents attendant to his return-to-work order. DOLE Secretary then issued a resolution declaring the strike illegal and pronouncing the loss of employment of its officers and members who participated in the strike. ALPAP filed a motion for reconsideration which was then denied. They appealed to the CA but the latter upheld the DOLE Resolution. They elevated the matter to the SC but their petition was dismissed on April 10, 2002 and attained finality on August 29, 2002. On January 13, 2003, ALPAP filed before the Office of the DOLE Secretary a motion requesting to conduct a legal proceeding to determine who among its officers and members should be reinstated or deemed to lost their employment with PAL for their actual participation in the strike. PAL, in its comment to ALPAP’s motion, argued that the motions cannot legally prosper since the DOLE Secretary has no authority to reopen or review a final judgment of the SC and the requested proceeding is no longer necessary as the CA or the SC did not order the remand of the case to the DOLE Secretary for such determination. The DOLE Secretary then ordered that their case has indeed been resolved with finality by the highest tribunal of the land. Being final and executory, the Office is bereft of authority to reopen an issue that has been passed upon by the SC. Again, they appealed to the CA but was later denied. Hence, this petition. ISSUE: WON there is a need to conduct an appropriate proceeding to determine the participants in the illegal strike and deemed to lost their employment status. HELD: There is no necessity to conduct a proceeding to determine the participants in the illegal strike or those who refused to heed the return-to-work order because the ambiguity can be cured by reference to the body of the decision and the pleadings filed. The DOLE Secretary declared the ALPAP officers and members to have lost their employment status based on either of two grounds: (1) their participation in the illegal strike or (2) their defiance of the return-to-work order of the DOLE Secretary. The records of the case unveil the names of each of these returning pilots. The logbook with the heading “Return to Work Compliance/Returnees” bears their individual signature signifying their conformity that they were among those workers who returned to work only on June 26, 1998 or after the deadline imposed by the DOLE. From this crucial and vital piece of evidence, it is apparent that each of these pilots is bound by the judgment.

Cirtek Employees Labor Union-Federation of Free Workers, petitioner vs. Cirtek Electonics, Inc., respondent GR. No. 190515, June 6, 2011 FACTS: On August 24, 2005, a Memorandum of Agreement (MOA) was entered between the respondent and the petitioner. However, the respondent subsequently question the validity of the MOA alleging that as early as February 5, 2010, petitioner Union had already filed with the DOLE a resolution of disaffiliation from the Federation of Free Workers resulting in the latter’s lack of personality to represent the workers. Petitioner contended that the alleged disaffiliation from the FFW was by virtue of a Resolution signed on February 23, 2010 and submitted to the DOLE Laguna Field Office on March 5, 2010 – two months after the present petition was filed on December 22, 2009. However, the court ruled in favour of the petitioners in a decision dated November 15, 2010. This opted the respondent to file a motion for reconsideration and supplemental motion for reconsideration. ISSUE: WON there was a valid disaffiliation. HELD: At all events, the issue of disaffiliation is an intra-union dispute which must be resolved in a different forum in an action at the instance of either or both the FFW and the Union or a rival labor organization, not the employer. An intra-union dispute refers to any conflict between and among union members, including grievances arising from any violation of the rights and conditions of membership, violation of or disagreement over any provision of the union’s constitution and by-laws, or disputes arising from chartering or disaffiliation of the union. Indeed, a local union may disaffiliate at any time from its mother federation, absent any showing that the same is prohibited under its constitution or rule. Such, however, does not result in its losing its legal personality altogether. A local labor union is a separate and distinct unit primarily designed to secure and maintain an equality of bargaining power between the employer and their employee-members. A local union does not owe its existence to the federation with which it is affiliated. It is a separate and distinct voluntary association owing its creation to the will of its members. The mere act of affiliation does not divest the local union of its own personality, neither does it give the mother federation the license to act independently of the local union.

Leyte Geothermal Power Progressive Employees Union-ALU-TUCP, petitioner vs. Philippine National Oil Company-Energy Development Corporation, respondent GR No. 170351, March 30, 2011 FACTS: Respondent PNOC-EDC is a government-owned and controlled corporation engaged in exploration, development, utilization, generation and distribution of energy like geothermal energy while petitioner is a legitimate labor organization duly registered with the DOLE Tacloban City. Leyte Geothermal Power Project is among respondent’s geothermal project. The said project is composed of the Tongonan 1 Geothermal Project (T1GP) and the Leyte Geothermal Production Field Project (LGFP) which provide the power and electricity needed in Central and Eastern Visayas and Luzon. They employed hundreds of employees on a contractual basis whereby their employment was only good up to the completion or termination of the project and would automatically expire upon the completion of such project. Majority of the employees employed in the project had become members of petitioner and with that, the petitioner demands from the respondent for recognition of it as the collective bargaining agent and for a CBA negotiation with it. However, respondent didn’t heed such demands. When the project was about to be completed, respondent serve Notices of Termination of Employment upon the employees who are members of the petitioner. Petitioner then filed a Notice of Strike against the respondent of unfair labor practice for refusal to bargain collectively, union busting and mass termination. On the same day, the petitioner declared a strike and staged such strike. Secretary of Labor intervened and issued an order directing all striking workers to return to work with 12 hours from the receipt of the order and the respondent to accept them back. However, the petitioner remained adamant in its position. They did not abide by the assumption order issued by the Secretary of th Labor. The respondent filed a complaint for strike illegality where the NLRC 4 Division favoured. Petitioner union filed a MR but was subsequently denied. They appealed to the CA but the latter likewise denied the petition for certiorari. Hence, this petition. ISSUES: (1) WON the officers and members of the petitioner Union are project employees of respondent; and (2) WON the officers and members of the petitioner Union engaged in illegal strike. HELD: (1) Regular employees or those who have been engaged to perform activities which are usually necessary or desirable in the usual business or trade of the employer while project employees or those whose employment has been fixed for a specific project or undertaking, the completion or termination of which has been determined at the time of the engagement of the employee. In the case at bar, the records reveal that the officers and members of the petitioner signed employment contracts indicating the specific project or phase of work for which they were hired, with a fixed period of employment. As clearly shown by petitioner’s own admission, both parties had executed the contracts freely and voluntarily without force, duress etc. Plainly, the litmus test to determine whether an individual is a project employee lies in settling a fixed period of employment involving a specific undertaking which completion or termination has been determined at the time of the particular employee’s engagement. (2) Petitioner engaged in illegal strike. It is quite evident from the records that the petitioner filed a notice of strike with the DOLE on December 28, 1998. On even date, the petitioner declared and staged a strike. Attempts by the NCMB to forge a mutually acceptable solution proved futile. Moreover, the petitioner in its pleading used the word “strike”.

NELSON A. CULILI vs.EASTERN TELECOMMUNICATIONS PHILIPPINES, INC., et al.; G.R. No. 165381;February 9, 2011 FIRST DIVISION; LEONARDO-DE CASTRO, J. Facts: Respondent Eastern Telecommunications Philippines, Inc. (ETPI) is a telecommunications company engaged mainly in the business of establishing commercial telecommunications systems and leasing of international datalines or circuits that pass through the international gateway facility (IGF).7 The other respondents are ETPI’s officers: Salvador Hizon, President and Chief Executive Officer; Emiliano Jurado, Chairman of the Board; Virgilio Garcia, Vice President; and Stella Garcia, Assistant Vice President. Petitioner Nelson A. Culili (Culili) was employed by ETPI as a Technician in its Field Operations Department on January 27, 1981. On December 12, 1996, Culili was promoted to Senior Technician in the Customer Premises Equipment Management Unit of the Service Quality Department and his basic salary was increased.8 In 1998, due to business troubles and losses, ETPI was compelled to implement a Right-Sizing Program which consisted of two phases. Among the departments abolished was the Service Quality Department. The abolition of the Service Quality Department rendered the specialized functions of a Senior Technician unnecessary. As a result, Culili’s position was abolished due to redundancy and his functions were absorbed by Andre Andrada, another employee already with the Business and Consumer Accounts Department On February 8, 2000, Culili filed a complaint against ETPI and its officers for illegal dismissal, unfair labor practice, and money claims before the Labor Arbiter. On April 30, 2001, the Labor Arbiter rendered a decision finding ETPI guilty of illegal dismissal and unfair labor practice. On appeal, the NLRC affirmed the Labor Arbiter’s decision but modified the amount of moral and exemplary damages awarded. The Court of Appeals, on February 5, 2004, partially granted ETPI’s petition. Issue: 1) W/n the Right-Sizing Program initiated by herein company is valid; 2) W/n petitioner’s position had become redundant. Held: Among the requisites of a valid redundancy program are: (1) the good faith of the employer in abolishing the redundant position; and (2) fair and reasonable criteria in ascertaining what positions are to be declared redundant,39 such as but not limited to: preferred status, efficiency, and seniority. In the case at bar, ETPI was upfront with its employees about its plan to implement a Right-Sizing Program. Even in the face of initial opposition from and rejection of the said program by ETEU, ETPI patiently negotiated with ETEU’s officers to make them understand ETPI’s business dilemma and its need to reduce its workforce and streamline its organization. This evidently rules out bad faith on the part of ETPI. There is redundancy when the service capability of the workforce is greater than what is reasonably required to meet the demands of the business enterprise. A position becomes redundant when it is rendered superfluous by any number of factors such as over-hiring of workers, decrease in volume of business, or dropping a particular product line or service activity previously manufactured or undertaken by the enterprise. In deciding which positions to retain and which to abolish, ETPI chose on the basis of efficiency, economy, versatility and flexibility. It needed to reduce its workforce to a sustainable level while maintaining functions necessary to keep it operating. The records show that ETPI had sufficiently established not only its need to reduce its workforce and streamline its organization, but also the existence of redundancy in the position of a Senior Technician. ETPI explained how it failed to meet its business targets and the factors that caused this, and how this necessitated it to reduce its workforce and streamline its organization. ETPI also submitted its old and new tables of organization and sufficiently described how limited the functions of the abolished position of a Senior Technician were and how it decided on whom to absorb these functions

ISLRIZ TRADING/VICTOR HUGO LU vs. EFREN CAPADA; G.R. No. 168501; January 31, 2011; FIRST DIVISION; DEL CASTILLO, J. Facts: Respondents Efren Capada, Lauro Licup, Norberto Nigos and Godofredo Magnaye were drivers while respondents Ronnie Abel, Arnel Siberre, Edmundo Capada, Nomerlito Magnaye and Alberto Dela Vega were helpers of Islriz Trading, a gravel and sand business owned and operated by petitioner Victor Hugo Lu. Claiming that they were illegally dismissed, respondents filed a Complaint3 for illegal dismissal and non-payment of overtime pay, holiday pay, rest day pay, allowances and separation pay against petitioner on August 9, 2000 before the Labor Arbiter. On his part, petitioner imputed abandonment of work against respondents. On December 21, 2001, Labor Arbiter Waldo Emerson R. Gan (Gan) declared that petitioner illegally dismissed said respondents and ordered reinstatement w/o loss of seniority rights and payment of full backwages from date of dismissal to actual reinstatement. The NLRC set aside the Decision of Labor Arbiter Gan in a Resolution7 dated September 5, 2002. Finding that respondents’ failure to continue working for petitioner was neither caused by termination nor abandonment of work, the NLRC ordered respondents’ reinstatement but without backwages. On December 9, 2003, however, respondents filed with the Labor Arbiter an Ex-Parte Motion to Set Case for Conference with Motion.12 They averred therein that since the Decision of Labor Arbiter Gan ordered their reinstatement, a Writ of Execution13 dated April 22, 2002 was already issued for the enforcement of its reinstatement aspect as same is immediately executory even pending appeal. But this notwithstanding and despite the issuance and subsequent finality of the NLRC Resolution which likewise ordered respondents’ reinstatement, petitioner still refused to reinstate them. Thus, respondents prayed that in view of the orders of reinstatement, a computation of the award of backwages be made and that an Alias Writ of Execution for its enforcement be issued. Nevertheless, Labor Arbiter Danna M. Castillon (Castillon) still issued a Writ of Execution16 dated March 9, 2004 to enforce the monetary award in accordance with the abovementioned computation. Accordingly, the Sheriff issued a Notice of Sale/Levy on Execution of Personal Property17 by virtue of which petitioner’s properties were levied and set for auction sale on March 29, 2004. In an effort to forestall this impending execution, petitioner then filed a Motion to Quash Writ of Execution with Prayer to Hold in Abeyance of Auction Sale18 and a Supplemental Motion to Quash/Stop Auction Sale.19 He also served upon the Sheriff a letter of protest.20 All of these protest actions proved futile as the Sheriff later submitted his Report dated March 30, 2004 informing the Labor Arbiter that he had levied some of petitioner’s personal properties and sold them in an auction sale where respondents were the only bidders. After each of the respondents entered a bid equal to their individual shares in the judgment award, the levied properties were awarded to them. Petitioner appealed to the CA but the latter dismissed said motion. Hence this petition. Issue: W/N respondents have the right to collect their accrued salaries during the period between the Labor Arbiter’s Decision ordering their reinstatement pending appeal and the NLRC Resolution overturning the same. Held: Yes, even if the order of reinstatement of the Labor Arbiter is reversed on appeal, it is obligatory on the part of the employer to reinstate and pay the wages of the dismissed employee during the period of appeal until reversal by the higher court or tribunal. It likewise settled the view that the Labor Arbiter’s order of reinstatement is immediately executory and the employer has to either re-admit them to work under the same terms and conditions prevailing prior to their dismissal, or to reinstate them in the payroll, and that failing to exercise the options in the alternative, employer must pay the employee’s salaries. In determining whether an employee is barred from recovering his accrued wages the two-fold test must be applied to wit: 1) there must be actual delay or that the order of reinstatement pending appeal was not executed prior to its reversal; and (2) the delay must not be due to the employer’s unjustified act or omission. If the delay is due to the employer’s unjustified refusal, the employer may still be required to pay the salaries notwithstanding the reversal of the Labor Arbiter’s Decision.

THE UNIVERSITY OF THE IMMACULATE CONCEPTION and MO. MARIA ASSUMPTA DAVID, RVM, vs. NATIONAL LABOR RELATIONS COMMISSION and TEODORA AXALAN; G.R. No. 181146; January 26, 2011; SECOND DIVISION; CARPIO, J.: Facts: Petitioner University of the Immaculate Conception is a private educational institution located in Davao City. Private respondent Teodora C. Axalan is a regular faculty member in the university holding the position of Associate Professor II. Aside from being a regular faculty member, Axalan is the elected president of the employees’ union. From 18 November to 22 November 2002, Axalan attended a seminar in Quezon City on website development. Axalan then received a memorandum6 from Dean Maria Rosa Celestial asking her to explain in writing why she should not be dismissed for having been absent without official leave. In her letter, Axalan claimed that she held online classes while attending the seminar. She explained that she was under the impression that faculty members would not be marked absent even if they were not physically present in the classroom as long as they conducted online classes. In reply, Dean Celestial relayed to Axalan the message of the university president that no administrative charge would be filed if Axalan would admit having been absent without official leave and write a letter of apology seeking forgiveness. Convinced that she could not be deemed absent since she held online classes, Axalan opted not to write the letter of admission and contrition the university president requested. The Dean wrote Axalan that the university president had created an ad hoc grievance committee to investigate the AWOL charge. From 28 January to 3 February 2003, Axalan attended a seminar in Baguio City on advanced paralegal training. Dean Celestial wrote Axalan informing her that her participation in the paralegal seminar in Baguio City was the subject of a second AWOL charge.11 The dean asked Axalan to explain in writing why no disciplinary action should be taken against her. After conducting hearings and receiving evidence, the ad hoc grievance committee found Axalan to have incurred AWOL on both instances and recommended that Axalan be suspended without pay for six months on each AWOL charge. The university president approved the committee’s recommendation.On 1 December 2003, Axalan filed a complaint against the university for illegal suspension, constructive dismissal, reinstatement with backwages, and unfair labor practice with prayer for damages and attorney’s fees. The university moved to dismiss the complaint on the ground that the Labor Arbiter had no jurisdiction over the subject matter of the complaint. The university maintained that jurisdiction lay in the voluntary arbitrator. On 11 October 2004, the Labor Arbiter rendered a Decision holding that the suspension of Axalan amounted to constructive dismissal entitling her to reinstatement and payment of backwages, salary differentials, damages, and attorney’s fees, The NLRC held that the Labor Arbiter, not the voluntary arbitrator, had jurisdiction as the controversy did not pertain to a dispute involving the union and the university. The Court of Appeals affirmed the findings of the Labor Arbiter and the NLRC. In its 13 December 2007 Decision, the Court of Appeals dismissed the university’s petition. Issue: 1) W/N the voluntary arbitrator had jurisdiction over the labor dispute; (2) whether Axalan was constructively dismissed; Held: The University contends that based on the transcript of stenographic notes from the ad hoc grievance committee hearing held on 20 February 2003, the parties agreed that the voluntary arbitrator would have jurisdiction over the labor dispute. In San Miguel Corp. v. NLRC,26 the Court ruled that for the exception to apply, there must be agreement between the parties clearly conferring jurisdiction to the voluntary arbitrator. Such agreement may be stipulated in a collective bargaining agreement. However, in the absence of a collective bargaining agreement, it is enough that there is evidence on record showing the parties have agreed to resort to voluntary arbitration.27 As can be gleaned from the transcript of stenographic notes of the administrative hearing held on 20 February 2003, the parties in this case clearly agreed to resort to voluntary arbitration. Thus, the Labor Arbiter should have immediately disposed of the complaint and referred the same to the voluntary arbitrator when the university moved to dismiss the complaint for lack of jurisdiction Well-settled is the rule that the jurisdiction of this Court in a petition for review on certiorari is limited to reviewing only errors of law, not of fact, unless the factual findings being assailed are not supported by the

evidence on record or the impugned judgment is based on a misapprehension of facts. Patently erroneous findings of the Labor Arbiter, even when affirmed by the NLRC and the Court of Appeals, are not binding on this Court. As to the second issue, constructive dismissal occurs when there is cessation of work because continued employment is rendered impossible, unreasonable, or unlikely as when there is a demotion in rank or diminution in pay or when a clear discrimination, insensibility, or disdain by an employer becomes unbearable to the employee leaving the latter with no other option but to quit. In this case however, there was no cessation of employment relations between the parties.It is unrefuted that Axalan promptly resumed teaching at the university right after the expiration of the suspension period. In other words, Axalan never quit. Hence, Axalan cannot claim that she was left with no choice but to quit, a crucial element in a finding of constructive dismissal. Thus, Axalan cannot be deemed to have been constructively dismissed. Significantly, at the time the Labor Arbiter rendered his Decision on 11 October 2004, Axalan had already returned to her teaching job at the university on 1 October 2004. The Labor Arbiter’s Decision ordering the reinstatement of Axalan, who at the time had already returned to work, is thus absurd. There being no constructive dismissal, there is no legal basis for the Labor Arbiter’s order of reinstatement as well as payment of backwages, salary differentials, damages, and attorney’s fees.30 Thus, the third issue raised in the petition is now moot

PRINCE TRANSPORT, Inc. and Mr. RENATO CLAROS vs. DIOSDADO GARCIA; G.R. No. 167291; January 12, 2011; SECOND DIVISION; PERALTA, J.: Facts: Respondents were employees of herein petitioner company. The latter is engaged in the business of transporting of passengers by land. The controversy begun when the company reduced the commissions of the respondents, this led the latter to hold meetings to discuss the protection of their interests as employees. The company learned about this meetings and suspected that his employees were about to form a union. They made known to its employees his objection in the formation of a union. Later on, the employees requested for a cash advance and the company denied it but allowed some to the employees. Because of this the respondents formed a union, the company then transferred the members of the union and its sympathizers to one of its sub-companies Lubas Transport Inc. The respondents then filed a complaint in the LA against the company. The LA dismissed the same. Respondents appealed to the NLRC, and the latter partially granted that same. The company appealed to the CA and the latter dismissed said petition. Issue: W/N the Company is guilty of ULP in transferring its employees who formed a Union and its sympathizers to its sub-company Lubas. Held: The respondents’ transfer of work assignments to Lubas was designed by petitioners as a subterfuge to foil the former’s right to organize themselves into a union. Under Article 248 (a) and (e) of the Labor Code, an employer is guilty of unfair labor practice if it interferes with, restrains or coerces its employees in the exercise of their right to self-organization or if it discriminates in regard to wages, hours of work and other terms and conditions of employment in order to encourage or discourage membership in any labor organization. Indeed, evidence of petitioners' unfair labor practice is shown by the established fact that, after respondents' transfer to Lubas, petitioners left them high and dry insofar as the operations of Lubas was concerned. The Court finds no error in the findings and conclusion of the CA that petitioners "withheld the necessary financial and logistic support such as spare parts, and repair and maintenance of the transferred buses until only two units remained in running condition." This left respondents virtually jobless.

THE HERITAGE HOTEL MANILA, acting through its owner, GRAND PLAZA HOTEL CORPORATION vs. NATIONAL UNION OF WORKERS IN THE HOTEL, RESTAURANT AND ALLIED INDUSTRIES-HERITAGE HOTEL MANILA SUPERVISORS CHAPTER (NUWHRAIN-HHMSC); G.R. No. 178296; January 12, 2011; SECOND DIVISION; NACHURA, J. Facts: On October 11, 1995, respondent filed with the Department of Labor and Employment-National Capital Region (DOLE-NCR) a petition for certification election.2 The Med-Arbiter granted the petition on February 14, 1996 and ordered the holding of a certification election.3 On appeal, the DOLE Secretary, in a Resolution dated August 15, 1996, affirmed the Med-Arbiter’s order and remanded the case to the Med-Arbiter for the holding of a preelection conference on February 26, 1997. Petitioner filed a motion for reconsideration, but it was denied on September 23, 1996 The preelection conference was not held as initially scheduled; it was held a year later, or on February 20, 1998. Petitioner moved to archive or to dismiss the petition due to alleged repeated non-appearance of respondent. The latter agreed to suspend proceedings until further notice. The preelection conference resumed on January 29, 2000. Subsequently, petitioner discovered that respondent had failed to submit to the Bureau of Labor Relations (BLR) its annual financial report for several years and the list of its members since it filed its registration papers in 1995. Consequently, on May 19, 2000, petitioner filed a Petition for Cancellation of Registration of respondent, on the ground of the non-submission of the said documents. Petitioner prayed that respondent’s Certificate of Creation of Local/Chapter be cancelled and its name be deleted from the list of legitimate labor organizations. It further requested the suspension of the certification election proceedings. On June 1, 2000, petitioner reiterated its request by filing a Motion to Dismiss or Suspend the [Certification Election] Proceedings,5 arguing that the dismissal or suspension of the proceedings is warranted, considering that the legitimacy of respondent is seriously being challenged in the petition for cancellation of registration. Petitioner maintained that the resolution of the issue of whether respondent is a legitimate labor organization is crucial to the issue of whether it may exercise rights of a legitimate labor organization, which include the right to be certified as the bargaining agent of the covered employees. Nevertheless, the certification election pushed through on June 23, 2000. Respondent emerged as the winner. On June 28, 2000, petitioner filed a Protest with Motion to Defer Certification of Election Results and Winner,7 stating that the certification election held on June 23, 2000 was an exercise in futility because, once respondent’s registration is cancelled, it would no longer be entitled to be certified as the exclusive bargaining agent of the supervisory employees. Petitioner also claimed that some of respondent’s members were not qualified to join the union because they were either confidential employees or managerial employees Med-Arbiter held that the pendency of a petition for cancellation of registration is not a bar to the holding of a certification election. Thus, in an Order11 dated January 26, 2001, the Med-Arbiter dismissed petitioner’s protest, and certified respondent as the sole and exclusive bargaining agent of all supervisory employees. Petitioner subsequently appealed the said Order to the DOLE Secretary.12 The appeal was later dismissed by DOLE Secretary Patricia A. Sto. Tomas (DOLE Secretary Sto. Tomas) in the Resolution of August 21, 2002.13 Petitioner moved for reconsideration, but the motion was also denied. In the meantime, Regional Director Alex E. Maraan (Regional Director Maraan) of DOLE-NCR finally resolved the petition for cancellation of registration. While finding that respondent had indeed failed to file financial reports and the list of its members for several years, he, nonetheless, denied the petition, ratiocinating that freedom of association and the employees’ right to self-organization are more substantive considerations. He took into account the fact that respondent won the certification election and that it had already been certified as the exclusive bargaining agent of the supervisory employees. In view of the foregoing, Regional Director Maraan— while emphasizing that the non-compliance with the law is not viewed with favor—considered the belated submission of the annual financial reports and the list of members as sufficient compliance thereof and considered them as having been submitted on time. The dispositive portion of the decision15 dated December 29, 2001 reads: Aggrieved, petitioner appealed the decision to the BLR.17 BLR Director Hans Leo Cacdac inhibited himself from the case because he had been a former counsel of respondent. In view of Director Cacdac’s inhibition, DOLE Secretary Sto. Tomas took cognizance of the appeal. In a resolution18 dated February 21, 2003, she dismissed the appeal, holding that the constitutionally guaranteed

freedom of association and right of workers to self-organization outweighed respondent’s noncompliance with the statutory requirements to maintain its status as a legitimate labor organization. In a Decision dated May 30, 2005, the CA denied the petition. The CA opined that the DOLE Secretary may legally assume jurisdiction over an appeal from the decision of the Regional Director in the event that the Director of the BLR inhibits himself from the case. According to the CA, in the absence of the BLR Director, there is no person more competent to resolve the appeal than the DOLE Secretary. The CA brushed aside the allegation of bias and partiality on the part of the DOLE Secretary, considering that such allegation was not supported by any evidence. Issue: W/N failure to submit reportorial requirements to the Bureau of Labor Relations (BLR) is a ground for cancellation of registration. Held: No. Failure to comply with the above requirements shall not be a ground for cancellation of union registration but shall subject the erring officers or members to suspension, expulsion from membership, or any appropriate penalty. It is undisputed that appellee failed to submit its annual financial reports and list of individual members in accordance with Article 239 of the Labor Code. However, the existence of this ground should not necessarily lead to the cancellation of union registration. Article 239 recognizes the regulatory authority of the State to exact compliance with reporting requirements. Yet there is more at stake in this case than merely monitoring union activities and requiring periodic documentation thereof. The more substantive considerations involve the constitutionally guaranteed freedom of association and right of workers to self-organization. Also involved is the public policy to promote free trade unionism and collective bargaining as instruments of industrial peace and democracy. An overly stringent interpretation of the statute governing cancellation of union registration without regard to surrounding circumstances cannot be allowed.

CENTRAL AZUCARERA DE BAIS EMPLOYEES UNION-NFL [CABEU-NFL], represented by its President, PABLITO SAGURAN vs. CENTRAL AZUCARERA DE BAIS, INC. [CAB], represented by its President, ANTONIO STEVEN L. CHAN; G.R. No. 186605; November 17, 2010; SECOND DIVISION; MENDOZA, J FACTS: Respondent Central Azucarera De Bais, Inc. (CAB) is a corporation duly organized and existing under the laws of the Philippines. It is represented by its President, Antonio Steven L. Chan (Chan), in this proceeding. CABEUNFL is a duly registered labor union and a certified bargaining agent of the CAB rank-and-file employees, represented by its President, Pablito Saguran (Saguran). On January 19, 2004, CABEU-NFL sent CAB a proposed Collective Bargaining Agreement (CBA)6 seeking increases in the daily wage and vacation and sick leave benefits of the monthly employees and the grant of leave benefits and 13th month pay to seasonal workers. On March 27, 2004, CAB responded with a counter-proposal to the effect that the production bonus incentive and special production bonus and incentives be maintained. In addition, respondent CAB agreed to execute a pro-rated increase of wages every time the government would mandate an increase in the minimum wage. CAB, however, did not agree to grant additional and separate Christmas bonuses. On May 21, 2004, CAB received an Amended Union Proposal sent by CABEU-NFL reducing its previous demand regarding wages and bonuses. CAB, however, maintained its position on the matter. Thus, the collective bargaining negotiations resulted in a deadlock. On account of the impasse, "CABEU-NFL filed a Notice of Strike with the National Conciliation and Mediation Board(NCMB). The NCMB then assumed conciliatory-mediation jurisdiction and summoned the parties to conciliation conferences." In its June 2, 2005 Letter sent to CAB (letter-request), CABEU-NFL requested copies of CAB’s annual financial statements from 2001 to 2004 and asked for the resumption of conciliation meetings. CAB replied through its June 14, 2005 Letter (letter-response) to NCMB Regional Director of Dumaguete City Isidro Cepeda, which reads: Mr. Pablito Saguran who is no longer an employee of the Central for he was one of those lawfully terminated due to an authorized cause and the Union which Mr. Saguran purportedly represents has already lost its majority status by reason of the disauthorization and withdrawal of support thereto by more than 90% of the rank and file employees in the bargaining unit of Central sometime in January, 2005, and the workers themselves, acting as principal, after disauthorizing the previous agent CABEU-NFL have organized themselves into a new Union known as Central Azucarera de Bais Employees Labor Association (CABELA) and after obtaining their registration certificate and making due representation that it is a duly organized union representing almost all the rank and file workers in the Central, had concluded a new collective bargaining agreement with the Central on April 21, 2005 in Dumaguete City It appears that the NCMB failed to act on the letter-response of CAB. Neither did it convene CAB and CABEU-NFL to continue the negotiations between them. Reacting from the letter-response of CAB, CABEU-NFL filed a Complaint for Unfair Labor Practice for the former’s refusal to bargain with it. On July 13, 2006, the LA dismissed the complaint. On appeal, the NLRC in its July 18, 2007 Decision reversed the LA’s decision and found CAB guilty of unfair labor practice. Unsatisfied, CAB elevated the matter to the CA by way of a petition for certiorari under Rule 65 alleging grave abuse of discretion on the part of the NLRC in reversing the LA decision and issuing the questioned resolution. On September 26, 2008, the CA found CAB’s petition meritorious and reversed the NLRC decision and resolution. Issue: W/the company is guilty of ULP HELD: No, for a charge of unfair labor practice to prosper, it must be shown that CAB was motivated by ill will, "bad faith, or fraud, or was oppressive to labor, or done in a manner contrary to morals, good customs, or public policy, and, of course, that social humiliation, wounded feelings or grave anxiety resulted x x x" in suspending negotiations with CABEU-NFL. Notably, CAB believed that CABEU-NFL was no longer the representative of the workers. It just wanted to foster industrial peace by bowing to the wishes of the overwhelming majority of its rank and file workers and by negotiating and concluding in good faith a CBA with CABELA." Such actions of CAB are nowhere tantamount to anti-unionism, the evil sought to be punished in cases of unfair labor practices.

CIRTEK EMPLOYEES LABOR UNION-FEDERATION OF FREE WORKERS vs. CIRTEK ELECTRONICS, INC.; G.R. No. 190515; November 15, 2010; THIRD DIVISION; CARPIO MORALES, J. Facts: Cirtek Electronics, Inc. (respondent), an electronics and semi-conductor firm situated inside the Laguna Technopark, had an existing Collective Bargaining Agreement (CBA) with Cirtek Employees Labor Union-Federation of Free Workers (petitioner) for the period January 1, 2001 up to December 31, 2005. Prior to the 3rd year of the CBA, the parties renegotiated its economic provisions but failed to reach a settlement, particularly on the issue of wage increases. Petitioner thereupon declared a bargaining deadlock and filed a Notice of Strike with the National Conciliation and Mediation Board-Regional Office No. IV (NCMB-RO IV) on April 26, 2004. Respondent, upon the other hand, filed a Notice of Lockout on June 16, 2004. While the conciliation proceedings were ongoing, respondent placed seven union officers including the President, a Vice President, the Secretary and the Chairman of the Board of Directors under preventive suspension for allegedly spearheading a boycott of overtime work. The officers were eventually dismissed from employment, prompting petitioner to file another Notice of Strike which was, after conciliation meetings, converted to a voluntary arbitration case. The dismissal of the officers was later found to be legal, hence, petitioner appealed. In the meantime, as amicable settlement of the CBA was deadlocked, petitioner went on strike on June 20, 2005. By Order dated June 23, 2005, the Secretary of Labor assumed jurisdiction over the controversy and issued a Return to Work Order which was complied with. Before the Secretary of Labor could rule on the controversy, respondent created a Labor Management Council (LMC) through which it concluded with the remaining officers of petitioner a Memorandum of Agreement (MOA) providing for daily wage increases of P6.00 per day effective January 1, 2004 and P9.00 per day effective January 1, 2005. Petitioner submitted the MOA via Motion and Manifestation to the Secretary of Labor, alleging that the remaining officers signed the MOA under respondent’s assurance that should the Secretary order a higher award of wage increase, respondent would comply. By Order dated March 16, 2006, the Secretary of Labor resolved the CBA deadlock by awarding a wage increase of fromP6.00 to P10.00 per day effective January 1, 2004 and from P9.00 to P15.00 per day effective January 1, 2005, and adopting all other benefits as embodied in the MOA. By Decision of September 24, 2009, the appellate court ruled in favor of respondent and accordingly set aside the Decision of the Secretary of Labor. Issue: 1) W/N the Secretary of Labor is authorized to give an award higher than that agreed upon in the MOA; 2) W/N the MOA was entered into and ratified by the remaining officers of petitioner under the condition, which was not incorporated in the MOA, that respondent would honor the Secretary of Labor’s award in the event that it is higher. Held: It is well-settled that the Secretary of Labor, in the exercise of his power to assume jurisdiction under Art. 263 (g) of the Labor Code, may resolve all issues involved in the controversy including the award of wage increases and benefits. While an arbitral award cannot per se be categorized as an agreement voluntarily entered into by the parties because it requires the intervention and imposing power of the State thru the Secretary of Labor when he assumes jurisdiction, the arbitral award can be considered an approximation of a collective bargaining agreement which would otherwise have been entered into by the parties, hence, it has the force and effect of a valid contract obligation. While the terms and conditions of a CBA constitute the law between the parties, it is not, however, an ordinary contract to which is applied the principles of law governing ordinary contracts. A CBA, as a labor contract within the contemplation of Article 1700 of the Civil Code of the Philippines which governs the relations between labor and capital, is not merely contractual in nature but impressed with public interest, thus, it must yield to the common good. As such, it must beconstrued liberally rather than narrowly and technically, and the courts must place a practical and realistic construction upon it, giving due consideration to the context in which it is negotiated and purpose which it is intended to serve. (emphasis and underscoring supplied)

SOLIDBANK CORPORATION (now known as FIRST METRO INVESTMENT CORPORATION) vs. ERNESTO U. GAMIER, ELENA R. CONDEVILLAMAR, JANICE L. ARRIOLA and OPHELIA C. DE GUZMAN; G.R. No. 159460; November 15, 2010; THIRD DIVISION; VILLARAMA, JR., J.: Facts: Sometime in October 1999, petitioner Solidbank and respondent Solidbank Employees were set to negotiate the economic provisions of their CBA. Negotiations commenced but seeing that an agreement was unlikely, the union declared a deadlock and filed a notice of strike. During the CBA negotiations, some unioin members staged mass actions. Secretary Laguesmma directed the parties to cease and desists from committing all acts that might exacerbate the situation. On april2, 2003 petitioners filed a motion for reconsideration but was denied by the CA. in view of the illegal strike conducted in violation of the secretary’s assumption order, petitioners maintain that the dismissal of respondents was not illegal. Also m, the CA erred in not finding that respondents were guilty of forum shopping. Petitioners maintained that respondents are not entitled to separation pay even if the dismissal was valid because they committed serious misconduct and for illegal act in defying the Secretary’s assumption order. Issue: W/N the protest rally and concerted work abandonment/boycott staged by the respondents violated the order. Held: The SC held that the Ca erred in concluding that the concerted mass actions staged by the respondents cannot be considered a strike but a legitimate exercise of the respondents right to express their dissatisfaction. It must be stressed that the concerted action of the respondents was not limited to the protests rally infront of the DOLE office. Considering that these mass actions stemmed from a bargaining deadlock and an order of assumption of jurisdiction had already been issued, there is no doubt that the concerted work abandonment/boycott was the result of a labor dispute.

BAGONG PAGKAKAISA NG MANGGAGAWA NG TRIUMPH INTERNATIONAL VS. DOLE AND TRIUMPH INTERNATIONAL FACTS The union and the company had a CBA that expired On july 18, 1999. The union seasonably submitted proposals to the company for its negotiation. The negotiations reached a deadlock leading to a notice of strike. NCMB exerted efforts but failed to resolve the deadlock. Consequently, the company filed a notice of lockout for unfair labor practice due to unions alleged work slowdown. The union went on strike 3 days later. After a few months, several employees attempted to report for work, but the striking employees prevented them from entering the company premises. On june 8 2000, the union and the officers filed a petition to cite the company and its responsible officer for contempt, and moved that a reinstatement order be issued. They claimed that: 1.) the company officials violated the secretary's return to work order; 2.) the company also violated the march 9 2000 order of the labor secretary; and 3.) the company commjtted unfair labor practice and dismissed them without basis. Issue Whether or not the dismissal is illegal. Held The SC affirmed the CA's conclusion that the labor secretary erred when he did not resolve the dismissal issue on the mistaken reading thatthis issue falls within the jurisdiction of the labor arbiter. For having participated in a prohibited activity not once, but twice, the union officers, except the decision can no longer reached because of the amicable settlement they entered into with the company, legally deserve to be dismissed from the service. For failure of the company, however, to prove by substantial evidence the illegal acts allegedly committed by rosalinda onlangar, who is a shop steward but not a union officer the SC find her dismissal without a valid cause.

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