[G.R. No. 124678. July 31, 1997.

DELIA BANGALISAN, LUCILIN CABALFIN, EMILIA DE

GUZMAN, CORAZON GOMEZ, CORAZON GREGORIO,
LOURDES LAREDO, RODOLFO MARIANO, WILFREDO
MERCADO, LIGAYA MONTANCES and CORAZON
PAGPAGUITAN, petitioners, vs. HON. COURT OF APPEALS,
THE CIVIL SERVICE COMMISSION and THE SECRETARY OF
THE DEPARTMENT OF EDUCATION, CULTURE AND
SPORTS, respondents.

Froilan M. Bacungan & Associates for petitioners.

The Solicitor General for respondents.

SYNOPSIS

Petitioners were charged by the Secretary of the Department of Education

Culture and Sports (DECS) with various offenses in violation of the Civil Service
Law. They were all placed under preventive suspension. The controversy arose
in connection with a "mass action" staged by a number of public school teachers
allegedly to dramatize their grievances against public school authorities. Acting
on appeal, the Civil Service Commission issued a resolution finding the
petitioners guilty of conduct prejudicial to the best interest of the service and
meted them a six months suspension with automatic reinstatement in service but
without payment of backwages. Rodolfo Mariano, however, was found guilty only
of violation of office rules and regulations because of his failure to inform the
school of intended absence and to file an application for leave, for which he was
given a penalty of reprimand. A petition for certiorari was filed by the public
school teachers with the Court of Appeals but it was dismissed due to lack of
merit, hence, this appeal by certiorari.
The Supreme Court affirmed the decision of the Court of Appeals with
modification that Rodolfo Mariano be given backwages from the time he was
suspended until his actual reinstatement. The Court ruled that the right of the
government employees to organize is limited to the formation of unions or
associations, without including the right to strike. The basis of the charges
against herein petitioners was within the competence of the Secretary of DECS
to place them under preventive suspension.

SYLLABUS
 1. CONSTITUTIONAL LAW; CIVIL SERVICE; RIGHT TO SELF-
ORGANIZATION; LIMITED TO THE FORMATION OF UNIONS OR
ASSOCIATIONS WITHOUT INCLUDING THE RIGHT TO STRIKE. — It is the
settled rule in this jurisdiction that employees in the public service may not
engage in strikes. While the Constitution recognizes the right of government
employees to organize, they are prohibited from staging strikes, demonstrations,
mass leaves, walk-outs and other forms of mass action which will result in
temporary stoppage or disruption of public services. The right of government
employees to organize is limited only to the formation of unions or associations,
without including the right to strike. The ability to strike is not essential to the right
of association. In the absence of statute, public employees do not have the right
to engage in concerted work stoppages for any purpose. As a general rule, even
in the absence of express statutory prohibition like Memorandum Circular No. 6,
public employees are denied the right to strike or engage in a work stoppage
against a public employer. The right of the sovereign to prohibit strikes or work
stoppages by public employees was clearly recognized at common law. Indeed,
it is frequently declared that modern rules which prohibit such strikes, either by
statute or by judicial decision, simply incorporate or reassert the common law
rule. To grant employees of the public sector the right to strike, there must be a
clear and direct legislative authority therefor. In the absence of any express
legislation allowing government employees to strike, recognizing their right to do
so, or regulating the exercise of the right, employees in the public service may
not engage in strikes, walkouts and temporary work stoppages like workers in the
private sector.
2. ID.; ID.; ID.; ID.; WHEN MASS ACTION LAUNCHED BY PUBLIC
SCHOOL TEACHERS MAY BE DEEMED A STRIKE; CASE AT BAR. — The
issue of whether or not the mass action launched by the public school teachers
during the period from September up to the first half of October, 1990 was a
strike has been decided by this Court in a resolution, dated December 18, 1990,
in the herein cited case of Manila Public School Teachers Association et
al. vs. Laguio, Jr., G.R. Nos. 95445 and 95590, August 6, 1991, 200 SCRA 323.
It was there held "that from the pleaded and admitted facts, these 'mass actions'
were to all intents and purposes a strike, they constituted a concerted and
unauthorized stoppage of, or absence from, work which it was the teachers' duty
to perform, undertaken for essentially economic reasons." It is an undisputed fact
that there was a work stoppage and that petitioners' purpose was to realize their
demands by withholding their services. The fact that the conventional term
"strike" was not used by the striking employees to describe their common course
of action is inconsequential, since the substance of the situation, and not its
appearance, will be deemed to be controlling.
3. ID.; ID.; ID.; ID.; ID.; RATIONALE FOR THE DENIAL OF THE RIGHT
TO STRIKE FOR GOVERNMENT EMPLOYEES. — As aptly stated by the
Solicitor General, "It is not the exercise by the petitioners of their constitutional
right to peaceably assemble that was punished, but the manner in which they
exercised such right which resulted in the temporary stoppage or disruption of
public service and classes in various public schools in Metro Manila. For, indeed,
there are efficient but non-disruptive avenues, other than the mass actions in
question, whereby petitioners could petition the government for redress of
grievances." It bears stressing that suspension of public services, however
temporary, will inevitably derail services to the public, which is one of the reasons
why the right to strike is denied government employees. It may be conceded that
the petitioners had valid grievances and noble intentions in staging the "mass
actions," but that will not justify their absences to the prejudice of innocent school
children. Their righteous indignation does not legalize an illegal work stoppage.
4. ADMINISTRATIVE LAW; PUBLIC OFFICERS; PREVENTIVE
SUSPENSION; IMPOSITION AND EXECUTION THEREOF; WHEN PROPER;
CASE AT BAR. — Section 51 of Executive Order No. 292 provides that "(t)he
proper disciplining authority may preventively suspend any subordinate officer or
employee under his authority pending an investigation, if the charge against such
officer or employee involves dishonesty, oppression or grave misconduct, or
neglect in the performance of duty, or if there are reasons to believe that the
respondent is guilty of charges which would warrant his removal from the
service." Under the aforesaid provision, it is the nature of the charge against an
officer or employee which determines whether he may be placed under
preventive suspension. In the instant case, herein petitioners were charged by
the Secretary of the DECS with grave misconduct, gross neglect of duty, gross
violation of Civil Service law, rules and regulations, and reasonable office
regulations, refusal to perform official duty, gross insubordination, conduct
prejudicial to the best interest of the service and absence without official leave
(AWOL), for joining the teachers' mass actions held at Liwasang Bonifacio on
September 17 to 21, 1990. Hence, on the basis of the charges against them, it
was within the competence of the Secretary to place herein petitioners under
preventive suspension. As to the immediate execution of the decision of the
Secretary against petitioners, the same is authorized by Section 47, paragraph
(2), of Executive Order No. 292, thus: "The Secretaries and heads of agencies
and instrumentalities, provinces, cities and municipalities shall have jurisdiction to
investigate and decide matters involving disciplinary action against officers and
employees under their jurisdiction. Their decisions shall be final in case the
penalty imposed is suspension for not more than thirty days or fine in an amount
not exceeding thirty days' salary. In case the decision rendered by a bureau or
office head is appealable to the Commission, the same shall be executory except
when the penalty is removal, in which case the same shall be executory only
after confirmation by the Secretary concerned."
 5. ID.; ID.; ADMINISTRATIVE DUE PROCESS; ESSENCE THEREOF;
CASE AT BAR. — Petitioners' claim of denial of due process must also fail. The
records of this case clearly show that they were given opportunity to refute the
charges against them but they failed to avail themselves of the same. The
essence of due process is simply an opportunity to be heard or, as applied to
administrative proceedings, an opportunity to seek reconsideration of the action
or ruling complained of. For as long as the parties were given the opportunity to
be heard before judgment was rendered, the demands of due process were
sufficiently met.
6. ID.; ID.; PAYMENT OF BACK SALARIES DURING THE PERIOD OF
SUSPENSION; WHEN PROPER; CASE AT BAR. — The issue regarding
payment of back salaries during the period of suspension of a member of the civil
service who is subsequently ordered reinstated, is already settled in our
jurisdiction. Such payment of salaries corresponding to the period when an
employee is not allowed to work may be decreed if he is found innocent of the
charges which caused the suspension and when the suspension is unjustified.
Under Section 23 of the Rules Implementing Book V of Executive Order No.
292 and other pertinent civil service laws, in violations of reasonable office rules
and regulations, the first offense is punishable by reprimand. To deny petitioner
Mariano his back wages during his suspension would be tantamount to punishing
him after his exoneration from the charges which caused his dismissal from the
service.
7. ID.; ID.; DENIAL OF SALARY DURING THE PERIOD OF
SUSPENSION; WHEN PROPER; RATIONALE. — The denial of salary to an
employee during the period of his suspension. if he should later be found guilty,
is proper because he had given ground for his suspension. It does not impair his
constitutional rights because the Constitution itself allows suspension for cause
as provided by law and the law provides that an employee may be suspended
pending an investigation or by way of penalty. Moreover, the general proposition
is that a public official is not entitled to any compensation if he has not rendered
any service. As he works, he shall earn.

DECISION

REGALADO, J : p

This is an appeal by certiorari from the judgment of the Court of Appeals in

CA-G.R. SP No. 38316, which affirmed several resolutions of the Civil Service
Commission finding petitioners guilty of conduct prejudicial to the best interest of
the service, as well as its resolution on April 12, 1996 denying petitioners' motion
for reconsideration. 1
Petitioners, except Rodolfo Mariano, were among the 800 public school
teachers who staged "mass actions" on September 17 to 19, 1990 to dramatize
their grievances concerning, in the main, the alleged failure of the public
authorities to implement in a just and correct manner certain laws and measures
intended for their material benefit.
On September 17, 1990, the Secretary of the Department of Education,
Culture and Sports (DECS) issued a Return-to-Work Order. Petitioners failed to
comply with said order, hence they were charged by the Secretary with "grave
misconduct; gross neglect of duty; gross violation of Civil Service law, rules and
regulations and reasonable office regulations; refusal to perform official duty;
gross insubordination; conduct prejudicial to the best interest of the service; and
absence without official leave in violation of PD 807, otherwise known as the Civil
Service Decree of the Philippines." They were simultaneously placed under
preventive suspension.
Despite due notice, petitioners failed to submit their answer to the
complaint. On October 30, 1990, the DECS Secretary rendered a decision
finding petitioners guilty as charged and dismissing them from the service
effective immediately.
Acting on the motions for reconsideration filed by petitioners Bangalisan,
Gregorio, Cabalfin, Mercado, Montances and Pagpaguitan, the Secretary
subsequently modified the penalty of dismissal to suspension for nine months
without pay.
Petitioner Gomez likewise moved for reconsideration with DECS and then
appealed to the Merit Systems Protection Board (MSPB). The other petitioners
also filed individual appeals to the MSPB, but all of their appeals were dismissed
for lack of merit.
Not satisfied with the aforestated adjudication of their respective cases,
petitioners appealed to the Civil Service Commission (CSC). The appeals of
petitioners Cabalfin, Montances and Pagpaguitan were dismissed for having
been filed out of time. On motion for reconsideration, however, the CSC decided
to rule on the merits of their appeal in the interest of justice.
cdasia

Thereafter, the CSC issued Resolution No. 94-1765 finding Cabalfin guilty
of conduct prejudicial to the best interest of the service and imposing on him a
penalty of six months suspension without pay. The CSC also issued Resolutions
Nos. 94-2806 and 94-2384 affirming the penalty of nine months suspension
without pay therefore imposed on petitioners Montances and Pagpaguitan.
 With respect to the appeals of the other petitioners, the CSC also found
them guilty of conduct prejudicial to the best interest of the service. It, however,
modified the penalty of nine months suspension previously meted to them to six
months suspension with automatic reinstatement in the service but without
payment of back wages.
All the petitioners moved for reconsideration of CSC resolutions but these
were all denied, 2 except that of petitioner Rodolfo Mariano who was found guilty
only of a violation of reasonable office rules and regulations because of his
failure to inform the school of his intended absence and to file an application for
leave therefor. This petitioner was accordingly given only a reprimand. 3
Petitioners then filed a petition for certiorari with this Court but, on August
29, 1995, their petition was referred to the Court of Appeals pursuant to Revised
Administrative Circular No. 1-95. 4
On October 20, 1995, the Court of Appeals dismissed the petition for lack
of merit. 5 Petitioners' motion for reconsideration was also denied by respondent
court, 6 hence the instant petition alleging that the Court of Appeals committed
grave abuse of discretion when it upheld the resolutions of the CSC (1) that
penalized petitioners whose only offense was to exercise their penalized
petitioners whose only offense was to exercise their constitutional right to
peaceably assemble and petition the government for redress of grievances; (2)
that penalized petitioner Mariano even after respondent commission found out
that the specific basis of the charges that former Secretary Cariño filed against
him was a falsehood; and (3) that denied petitioners, their right to back wages
covering the period when they were illegally not allowed to teach. 7
It is the settled rule in this jurisdiction that employees in the public service
may not engage in strikes. While the Constitution recognizes the right of
government employees to organize, they are prohibited from staging strikes,
demonstrations, mass leaves, walk-outs and other forms of mass action which
will result in temporary stoppage or disruption of public services. The right of
government employees to organize is limited only to the formation of unions or
associations, without including the right to strike. 8
Petitioners contend, however, that they were not on strike but were merely
exercising their constitutional right peaceably to assemble and petition the
government for redress of grievances. We find such pretension devoid of merit.
The issue of whether or not the mass action launched by the public school
teachers during the period from September up to the first half of October, 1990
was a strike has been decided by this Court in a resolution, dated December 18,
1990, in the herein cited case of Manila Public School Teachers Association, et
al. vs. Laguio, Jr., supra. It was there held "that from the pleaded and admitted
facts, these 'mass actions' were to all intents and purposes a strike; they
constituted a concerted and unauthorized stoppage of, or absence from, work
which it was the teachers' duty to perform, undertaken for essentially economic
reasons."
It is an undisputed fact that there was a work stoppage and that petitioners'
purpose was to realize their demands by withholding their services. The fact that
the conventional term "strike" was not used by the striking employees to describe
their common course of action is inconsequential, since the substance of the
situation, and not its appearance, will be deemed to be controlling. 9
The ability to strike is not essential to the right of association. In the
absence of statute, public employees do not have the right to engage in
concerted work stoppage for any purpose. 10
Further, herein petitioners, except Mariano, are being penalized not
because they exercised their right of peaceable assembly and petition for redress
of grievances but because of their successive unauthorized and unilateral
absences which produced adverse effects upon their students for whose
education they are responsible. The actuations of petitioners definitely
constituted conduct prejudicial to the best interest of the service, punishable
under the Civil Service law, rules and regulations.
As aptly stated by the Solicitor General, "It is not the exercise by the
petitioners of their constitutional right to peaceably assemble that was punished,
but the manner in which they exercised such right which resulted in the
temporary stoppage or disruption of public service and classes in various public
schools in Metro Manila. For, indeed, there are efficient but non-disruptive
avenues, other than the mass actions in question, whereby petitioners could
petition the government for redress of grievances." 11
It bears stressing that suspension of public services, however temporary,
will inevitably derail services to the public, which is one of the reasons why the
right to strike is denied government employees. 12 It may be conceded that the
petitioners had valid grievances and noble intentions in staging the "mass
actions," but that will not justify their absences to the prejudice of innocent school
children. Their righteous indignation does not legalize an illegal work
stoppage. aisadc

As expounded by this Court in its aforementioned resolution of December

18, 1990, in the Manila Public School Teachers Association case, ante:
"It is, of course, entirely possible that petitioners and their
member-teachers had and have some legitimate grievances. This much
may be conceded. After all, and for one thing, even the employees of the
Court have found reason to complain about the manner in which the
provisions of the salary standardization law on pay adjustments and
position classification have been, or are being, implemented.
 Nonetheless, what needs to be borne in mind, trite though it may be, is
that one wrong cannot be righted by another, and that redress, for even
the most justifiable complaints, should not be sought through proscribed
or illegal means. The belief in the righteousness of their cause, no matter
how deeply and fervently held, gives the teachers concerned no license
to abandon their duties, engage in unlawful activity, defy constituted
authority and set a bad example to their students."
Petitioners also assail the constitutionality of Memorandum Circular No.
6 issued by the Civil Service Commission. The resolution of the said issue is not
really necessary in the case at bar. The argument of petitioners that the said
circular was the basis of their liability is off tangent.
As a general rule, even in the absence of express statutory prohibition
like Memorandum Circular No. 6, public employees are denied the right to strike
or engage in a work stoppage against a public employer. 13 The right of the
sovereign to prohibit strikes or work stoppages by public employees was clearly
recognized at common law. Indeed, it is frequently declared that modern rules
which prohibit such strikes, either by statute or by judicial decision, simply
incorporate or reassert the common law rule. 14
To grant employees of the public sector the right to strike, there must be a
clear and direct legislative authority therefor. 15 In the absence of any express
legislation allowing government employees to strike, recognizing their right to do
so, or regulating the exercise of the right, employees in the public service may
not engage in strikes, walkouts and temporary work stoppages like workers in the
private sector. 16
On the issue of back wages, petitioners' claim is premised on the
allegation that their preventive suspension, as well as the immediate execution of
the decision dismissing or suspending them, are illegal. These submissions are
incorrect.
Section 51 of Executive Order No. 292 provides that "(t)he proper
disciplining authority may preventively suspend any subordinate officer or
employee under his authority pending an investigation, if the charge against such
officer or employee involves dishonesty, oppression or grave misconduct, or
neglect in the performance of duty, or if there are reasons to believe that the
respondent is guilty of charges which would warrant his removal from the
service."
Under the aforesaid provision, it is the nature of the charge against an
officer or employee which determines whether he may be placed under
preventive suspension. In the instant case, herein petitioners were charged by
the Secretary of the DECS with grave misconduct, gross neglect of duty, gross
violation of Civil Service law, rules and regulations, and reasonable office
regulations, refusal to perform official duty, gross insubordination, conduct
prejudicial to the best interest of the service and absence without official leave
(AWOL), for joining the teachers' mass actions held at Liwasang Bonifacio on
September 17 to 21, 1990. Hence, on the basis of the charges against them, it
was within the competence of the Secretary to place herein petitioners under
preventive suspension.
As to the immediate execution of the decision of the Secretary against
petitioners, the same is authorized by Section 47, paragraph (2), of Executive
Order No. 292, thus: "The Secretaries and heads of agencies and
instrumentalities, provinces, cities and municipalities shall have jurisdiction to
investigate and decide matters involving disciplinary action against officers and
employees under their jurisdiction. Their decisions shall be final in case the
penalty imposed is suspension for not more than thirty days or fine in an amount
not exceeding thirty days salary. In case the decision rendered by a bureau or
office head is appealable to the Commission, the same shall be executory except
when the penalty is removal, in which case the same shall be executory only
after confirmation by the Secretary concerned."
Petitioners' claim of denial of due process must also fail. The records of
this case clearly show that they were given opportunity to refute the charges
against them but they failed to avail themselves of the same. The essence of due
process is simply an opportunity to be heard or, as applied to administrative
proceedings, an opportunity to seek reconsideration of the action or ruling
complained of. 17 For as long as the parties were given the opportunity to be
heard before judgment was rendered, the demands of due process were
sufficiently met. 18
Having ruled that the preventive suspension of petitioners and the
immediate execution of the DECS decision are in accordance with law, the next
query is whether or not petitioners may be entitled to back wages.
The issue regarding payment of back salaries during the period of
suspension of a member of the civil service who is subsequently ordered
reinstated, is already settled in our jurisdiction. Such payment of salaries
corresponding to the period when an employee is not allowed to work may be
decreed if he is found innocent of the charges which caused the suspension and
when the suspension is unjustified. 19
With respect to petitioner Rodolfo Mariano, payment of his back wages is
in order. A reading of the resolution of the Civil Service Commission will show
that he was exonerated of the charges which formed the basis for his
suspension. The Secretary of the DECS charged him with and he was later found
guilty of grave misconduct, gross neglect of duty, gross violation of the Civil
Service Law, rules and regulations and reasonable office regulations, refusal to
perform official duty, gross insubordination, conduct prejudicial to the best
interest of the service, and absence without official leave, for his participation in
the mass actions on September 18, 20 and 21, 1990. It was his alleged
participation in the mass actions that was the basis of his preventive suspension
and later, his dismissal from the service.
However, the Civil Service Commission, in the questioned resolution,
made a finding that Mariano was not involved in the "mass actions" but was
absent because he was in Ilocos Sur to attend the wake and interment of his
grandmother. Although the CSC imposed upon him the penalty of reprimand, the
same was for his violation of reasonable office rules and regulations because he
failed to inform the school of his intended absence and neither did he file an
application for leave covering such absences. 20
Under Section 23 of the Rules Implementing Book V of Executive Order
No. 292 and other pertinent civil service laws, in violations of reasonable office
rules and regulations, the first offense is punishable by reprimand. To deny
petitioner Mariano his back wages during his suspension would be tantamount to
punishing him after his exoneration from the charges which caused his dismissal
from the service. 21
However, with regard to the other petitioners, the payment of their back
wages must be denied. Although the penalty imposed on them was only
suspension, they were not completely exonerated of the charges against them.
The CSC made specific findings that, unlike petitioner Mariano, they indeed
participated in the mass actions. It will be noted that it was their participation in
the mass actions that was the very basis of the charges against them and their
subsequent suspension. cdasia

The denial of salary to an employee during the period of his suspension, if

he should later be found guilty, is proper because he had given ground for his
suspension. It does not impair his constitutional rights because the Constitution
itself allows suspension for cause as provided by law and the law provides that
an employee may be suspended pending an investigation or by way of
penalty. 22
Moreover, the general proposition is that a public official is not entitled to
any compensation if he has not rendered any service. As he works, he shall
earn. Since petitioners did not work during the period for which they are now
claiming salaries, there can be no legal or equitable basis to order the payment
of such salaries. 23
It is also noteworthy that in its resolutions, the Civil Service Commission
expressly denied petitioners' right to back wages. In the case of Yacia vs. City of
Baguio, 24 the decision of the Commissioner of Civil Service ordering the
dismissal of a government employee on the ground of dishonesty was
immediately executed pending appeal, but, on appeal, the Civil Service Board of
Appeals modified that penalty to a fine equivalent to six months pay. We ruled
that the claim of an employee for back wages, for the period during which he was
not allowed to work because of the execution of the decision of the
Commissioner, should be denied.
The appeal board's modified decision did not exonerate the employee nor
did it affect the validity of his dismissal or separation from work pending appeal,
as ordered by the Civil Service Commissioner. Such separation from work
pending his appeal remained valid and effective until it was set aside and
modified with the imposition of the lesser penalty by the appeals board. If the
Civil Service Appeals Board had intended to grant him back salaries and to
reduce his penalty to six months fine deductible from such unearned back
salaries, the board could and should have so expressly stated in its decision.
WHEREFORE, the decision of the Court of Appeals is hereby AFFIRMED,
but with the MODIFICATION that petitioner Rodolfo Mariano shall be given back
wages without deduction or qualification from the time he was suspended until
his actual reinstatement which, under prevailing jurisprudence, should not
exceed five years.
SO ORDERED.
Padilla, Davide, Jr., Romero, Bellosillo, Melo, Puno, Vitug, Kapunan,
Mendoza, Francisco, Hermosisima, Jr., andPanganiban, JJ ., concur.
Narvasa, C .J . and Torres, J., are on official leave.
(Bangalisan v. Court of Appeals, G.R. No. 124678, [July 31, 1997], 342 PHIL
|||

586-600)

[G.R. No. 103560. July 6, 1995.]

GOLD CITY INTEGRATED PORT SERVICE, INC.

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

[G.R. No. 103599. July 6, 1995.]

ADELO EBUNA, WILFREDO DAHAN, RICARDO LAURETO,

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

SYLLABUS

1. LABOR AND SOCIAL LEGISLATION; LABOR CODE; STRIKE;

DEFINED; PRESENT IN CASE AT BAR. — A strike, considered as the most
effective weapon of labor, is defined as any temporary stoppage of work by the
concerted action of employees as a result of an industrial or labor dispute. A
labor dispute includes any controversy or matter concerning terms or conditions
of employment or the association or representation of persons in negotiating,
fixing, maintaining, changing or arranging the terms and conditions of
employment, regardless of whether or not the disputants stand in the proximate
relation of employers and employees. Private respondents and their co-workers
stopped working and held the mass action on April 30, 1985 to press for their
wages and other benefits. What transpired then was clearly a strike, for the
cessation of work by concerted action resulted from a labor dispute.
2. ID.; ID.; ID.; ILLEGAL IN CASE AT BAR. — The strike was illegal for
failure to comply with the requirements of Article 264 (now Article 263)
paragraphs (c) and (f) of the Labor Code. The individual notices of strike filed by
the workers did not conform to the notice required by the law to be filed since
they were represented by a union (MLU-FFW) which even had an existing
collective bargaining agreement with INPORT. Neither did the striking workers
observe the strike vote by secret ballot, cooling-off period and reporting
requirements.
3. ID.; EMPLOYMENT; ILLEGAL DISMISSAL; REINSTATEMENT AND
BACKWAGES. — Private respondents are dismissed when INPORT refused to
accept them back to work after the former refused to submit to the "screening"
process. Reinstatement means restoration to a state or condition from which one
had been removed or separated. Reinstatement and backwages are separate
and distinct reliefs given to an illegally dismissed employee. Backwages, is a
form of relief that restores the income that was lost by reason of unlawful
dismissal. Under the law, an employee is entitled to reinstatement and to his full
backwages when he is unjustly dismissed.
4. ID.; ID.; SEPARATION PAY, WHEN PROPER. — Where reinstatement
is not possible or when dismissal is due to valid causes, separation pay may be
granted. Separation pay is awarded when reinstatement is not possible, due, for
instance, to strained relations between employer and employee. It is also given
as a form of financial assistance when a worker is dismissed in cases such as
the installation of labor saving devices, redundancy, retrenchment to prevent
losses, closing or cessation of operation of the establishment, or in case the
employee was found to have been suffering from a disease such that his
continued employment is prohibited by law. Separation pay is a statutory right
defined as the amount that an employee receives at the time of his severance
from the service and is designed to provide the employee with the wherewithal
during the period that he is looking for another employment. It is oriented towards
the immediate future, the transitional period the dismissed employee must
undergo before locating a replacement job. Hence, an employee dismissed for
causes other than those cited above is not entitled to separation pay. Well-settled
is it that separation pay shall be allowed only in those instances where the
employee is validly dismissed for causes other than serious misconduct or those
reflecting on his moral character.
5. ID.; LABOR RELATIONS; ILLEGAL STRIKE; EFFECTS ON
PARTICIPATING WORKERS AND UNION OFFICERS, DISTINGUISHED. —
The effects of illegal strikes, outlined in Article 265 (now Article 264) of the Labor
Code, make a distinction between workers and union officers who participate
therein. A union officer who knowingly participates in an illegal strike and any
worker or union officer who knowingly participates in the commission of illegal
acts during a strike may be declared to have lost their employment status. An
ordinary striking worker cannot be terminated for mere participation in an illegal
strike. There must be proof that he committed illegal acts during a strike. A union
officer, on the other hand, may be terminated from work when he knowingly
participates in an illegal strike, and like other workers, when he commits an illegal
act during a strike. Here, there appears no proof that the union members
committed illegal acts during the strike; hence, they cannot be dismissed. The
striking union members among private respondents are thus entitled to
reinstatement, there being no just cause for their dismissal However, considering
that a decade has already lapsed from the time the disputed strike occurred, we
find that to award separation pay in lieu of reinstatement would be more practical
and appropriate. No backwages will be awarded to private respondent-union
members as a penalty for their participation in the illegal strike. Their continued
participation in said strike, even after most of their co-workers had returned to
work, can hardly be rewarded by such an award. The fate of private respondent-
union officers is different. Their Insistence on unconditional reinstatement or
separation pay and backwages is unwarranted and unjustified. For knowingly
participating in an illegal strike, the law mandates that a union officer may be
terminated from employment. Notwithstanding the fact that INPORT previously
accepted other union officers and that the screening required by it was uncalled
for, still it cannot be gainsaid that it possessed the right and prerogative to
terminate the union officers from service. The law, in using the word may, grants
the employer the option of declaring a union officer who participated in an illegal
strike as having lost his employment. Moreover, an illegal strike which, more
often than not. brings about unnecessary economic disruption and chaos in the
workplace should not be countenanced by a relaxation of the sanctions
prescribed by law. The union officers are, therefore, not entitled to any relief.

DECISION

ROMERO, J : p

Should separation pay and backwages be awarded by public

respondent NLRC to participants of an illegal strike? This is the core issue to
be decided in these two petitions.
Gold City Integrated Port Service, Inc. (INPORT) filed a petition for
certiorari against the National Labor Relations Commission (NLRC) assailing
the latter's decision in "Gold City Integrated Port Services, Inc. v. Adelo
Ebuna, et al." (NLRC RABX Case No. 5-0405-85) with twenty-seven private
respondents (G.R. No. 103599). 1 This petition has been consolidated with
G.R. No. 103599 where the petitioners are the private respondents in instant
case and the private respondent in INPORT. For the sake of clarify, INPORT
shall be denominated in the case at bench as the petitioner and the
employees as private respondents.
Instant case arose from the following facts:
 Early in the morning of April 30, 1985, petitioner's employees stopped
working and gathered in a mass action to express their grievances regarding
wages, thirteenth month pay and hazard pay. Said employees were all
members of the Macajalar Labor Union-Federation of Free Workers (MLU-
FFW) with whom petitioner had an existing collective bargaining agreement.
Petitioner was engaged in stevedoring and arrastre services at the port
of Cagayan de Oro. The strike paralyzed operations at said port.
On the same morning, the strikers filed individual notices of strike
("Kaugalingon nga Declarasyon sa Pag-Welga") with the then Ministry of
Labor and Employment.
With the failure of conciliation conferences between petitioner and the
strikers, INPORT filed a complaint before the Labor Arbiter for Illegal Strike
with prayer for a restraining order/preliminary injunction.
On May 7, 1985, the National Labor Relations Commission issued a
temporary restraining order. Thereafter, majority of the strikes returned to
work, leaving herein private respondents who continued their protest. 2
Counsel for private respondents filed a manifestation that petitioner
required prior screening conducted by the MLU-FFW before the remaining
strikers could be accepted back to work.
Meanwhile, counsel for the Macajalar Labor Union (MLU-FFW) filed a
"Motion to Drop Most of the Party Respondents From the Above Entitled
Case." The 278 employees on whose behalf the motion was filed, claimed
that they were duped or tricked into signing the individual notices of strike.
After discovering this deception and verifying that the strike was staged by a
minority of the union officers and members and without the approval of, or
consultation with, majority of the union members, they immediately withdrew
their notice of strike and returned to work.
The petitioner INPORT, not having interposed any objection, the Labor
Arbiter, in his decision dated July 23, 1985, granted their prayer to be
excluded as respondents in the complainant for illegal strike. Moreover,
petitioner's complaint was directed against the 31 respondent who did not
return to work and continued with the strike.
For not having complied with the formal requirements in Article 264 of
the Labor Code, 3 the strike staged by petitioner's workers on April 30, 1985
was found by the Labor Arbiter to be illegal. 4 The workers who participated in
the illegal strike did not, however lose their employment, since there was no
evidence that they participated in illegal acts. After noting that petitioner
accepted the other striking employees back to work, the Labor Arbiter held
that the private respondents should similarly be allowed to return to work
without having to undergo the required screening to be undertaken by their
union (MLU-FFW).
As regards the six private respondents who were union officers, the
Labor Arbiter ruled that they could not have possibly been "duped or tricked"
into signing the strike notice for they were active participants in the
conciliation meetings and were thus fully aware of what was going on. Hence,
said union officers should be accepted back to work after seeking
reconsideration from herein petitioner. 5
The dispositive portion of the decision reads:
"IN VIEW OF THE FOREGOING, it is hereby ordered that the
strike undertaken by the officers and majority union members of
Macajalar Labor Union-FFW is ILLEGAL contrary to Article 264 of the
Labor Code, as amended. Our conclusion on the employment status of
the illegal strikers is subject to our discussion above." 6
Both petitioner and private respondents filed motions for
reconsideration, which public respondent NLRC treated as appeals. 7
On January 14, 1991, the NLRC affirmed with modification 8 the
Arbiter's decision. It held that the concerted action by the workers was more of
a "protest action" than a strike. Private respondents, including the six union
officers, should also be allowed to work unconditionally to avoid
discrimination. However, in view of the strained relations between the parties,
separation pay was awarded in lieu of reinstatement. The decretal portion of
the Resolution reads: prcd

"WHEREFORE, the decision appealed from is Affirmed with

modification in accordance with the foregoing resolution. Complainant
INPORT is hereby ordered, in lieu of reinstatement, to pay respondents
the equivalent of twelve (12) months salaries each as separation pay.
Complainant is further ordered to pay respondents two (2) years
backwages based on their last salaries, without qualification or
deduction. The appeal of complainant INPORT is Dismissed for lack of
merit." 9
Upon petitioner's motion for reconsideration, public respondent modified
the above resolution on December 12, 1991. 10
The Commission ruled that since private respondents were not actually
terminated from service, there was no basis for reinstatement. However, it
awarded six months' salary as separation pay or financial assistance in the
nature of "equitable relief." The award for backwages was also deleted for
lack of actual and legal basis. In lieu of backwages, compensation equivalent
to P1,000.00 was given.
The dispositive portion of the assailed Resolution reads:
 "WHEREFORE, the resolution of January 14, 1991
is Modified reducing the award for separation pay to six (6) months each
in favor of respondents, inclusive of lawful benefits as well as those
granted under the CBA, if any based on the latest salary of respondents,
as and by way of financial assistance while the award for backwages
is Deleted and Set Aside. In lieu thereof, respondent are granted
compensation for their sudden loss of employment in the sum of
P1,000.00 each. The motion of respondents to implead PPA as third-
party respondent is Noted. Except for this modification the rest of the
decision sought to be reconsidered shall stand." 11
In the instant petitions for certiorari, petitioner alleges that public
respondent Commission committed grave abuse of discretion in awarding
private respondents separation pay and backwages despite the declaration
that the strike was illegal.
On the other hand, private respondents, in their petition, assail the
reduction of separation pay and deletion of backwages by the NLRC as
constituting grave abuse of discretion.
They also allege that the Resolution of January 14, 1991 could not be
reconsidered after the unreasonable length of time of eleven months.
Before proceeding with the principal issues raised by the parties, it is
necessary to clarify public respondent's statements concerning the strike
staged by INPORT's employees.
In its resolution dated January 14, 1991, The NLRC held that the facts
prevailing in the case at bench require a relaxation of the rule that the formal
requisites for a declaration of a strike are mandatory. Furthermore, what the
employees engaged in was more of a spontaneous protest action than a
strike. 12
Nevertheless, the Commission affirmed the Labor Arbiter's decision
which declared the strike illegal.
A strike, considered as the most effective weapon of labor, 13 is defined
as any temporary stoppage of work by the concerted action of employees as
a result of an industrial or labor dispute. 14 A labor dispute includes any
controversy or matter concerning terms or conditions of employment or the
association or representation of persons in negotiating, fixing, maintaining,
changing or arranging the terms and conditions of employment, regardless of
whether or not the disputants stand in the proximate relation of employers and
employees. 15
Private respondents and their co-workers stopped working and held the
mass action on April 30, 1985 to press for their wages and other benefits.
What transpired then was clearly a strike, for the cessation of work by
concerted action resulted from a labor dispute.
 The complainant before the Labor Arbiter involved the legality of said
strike. The Arbiter correctly ruled that the strike was illegal for failure to
comply with the requirements of Article 264 (now Article 263) paragraph (c)
and (f) of the Labor Code. 16
The individual notices of strike filed by the workers did not conform to
the notice required by the law to be filed since they were represented by a
union (MLU-FFW) which even had an existing collective bargaining
agreement with INPORT.
Neither did the striking workers observe the strike vote by secret ballot,
cooling-off period and reporting requirements.
As we stated in the case of National Federation of Sugar Workers v.
Ovejera, 17 the language of the law leaves no room for doubt that the cooling-
off period and the seven-day strike ban after strike-vote report were intended
to be mandatory. 18
Article 265 of the Labor Code reads, inter alia:
"(i)t SHALL be unlawful for any labor organization . . . to declare a
strike . . . without first having filed the notice required in the preceding
Article or without the necessary strike vote first having been obtained
and reported to the Ministry." (Emphasis ours)
In explaining the above provision, we said:
"In requiring a strike notice and a cooling-off period, the avowed
intent of the law is to provide an opportunity for mediation and
conciliation. It thus directs the Mole to exert all efforts at mediation and
conciliation to effect a voluntary settlement' during the cooling-off period.
...
xxx xxx xxx
The cooling-off period and the 7-day strike ban after the filing of a
strike-vote report, as prescribed in Art. 264 of the Labor Code, are
reasonable restrictions and their imposition is essential to attain the
legitimate policy objectives embodied in the law. We hold that they
constitute a valid exercise of the police power of the state." 19
From the foregoing, it is patent that the strike on April 30, 1985 was
illegal for failure to comply with the requirements of the law.
The effects of such illegal strikes, outlined in Article 265 (now Article
264) of the Labor Code, make a distinction between workers and union
officers who participate therein.
A union officer who knowingly participates in an illegal strike and any
worker or union officer who knowingly participates in the commission of illegal
acts during a strike may be declared to have lost their employment
status. 20 An ordinary striking worker cannot be terminated for mere
participation in an illegal strike. There must be proof that he committed illegal
acts during a strike. A union officer, on the other hand, may be terminated
from work when he knowingly participates in an illegal strike, and like other
workers, when he commits an illegal strike.
In the case at bench, INPORT accepted the majority of the striking
workers, including union officers, back to work. Private respondents were left
to continue with the strike after they refused to submit to the "screening"
required by the company. 21
The question to be resolved now is what these remaining strikers,
considering the circumstances of the case, are entitled to receive under the
law, if any.
Are they entitled, as they claim, to reinstatement or separation pay and
backwages?
In his decision, the Labor Arbiter ordered INPORT to reinstate/accept
the remaining workers as well as to accept the remaining union officers after
the latter sought reconsideration from INPORT. 22
The NLRC on January 14, 1991, modified the above decision by
ordering INPORT to pay private respondents the equivalent of twelve months
in salary as separation pay in lieu of reinstatement and two years'
backwages. 23
On reconsideration, public respondent modified its original award and
reduced the separation pay to six months, deleted the award for backwages
and instead awarded P1,000.00 as compensation for their sudden loss of
employment. 24
Under the law, an employee is entitled to reinstatement and to his full
backwages when he is unjustly dismissed. 25
Reinstatement means restoration to a state or condition from which one
had been removed or separated. Reinstatement and backwages are separate
and distinct reliefs given to an illegally dismissed employee. 26
Separation pay is awarded when reinstatement is not possible, due, for
instance, to strained relations between employer and employee.
It is also given as a from of financial assistance when a worker is
dismissed in cases such as the installation of labor saving devices,
redundancy, retrenchment to prevent losses, closing or cessation of operation
of the establishment, or in case the employee was found to have been
suffering from a disease such that his continued employment is prohibited by
law. 27
Separation pay is a statutory right defined as the amount that an
employee receives at the time of his severance from the service and is
designed to provide the employee with the wherewithal during the period that
he is looking for another employment. 28 It is oriented towards the immediate
future, the transitional period the dismissed employee must undergo before
locating a replacement job. 29
Hence, an employee dismissed for causes other than those cited above
is not entitled to separation pay. 30 Well-settled is it that separation pay shall
be allowed only in those instances where the employee is validly dismissed
for causes other than serious misconduct or those reflecting on his moral
character. 31
Backwages, on the other hand, is a form of relief that restores the
income that was lost by reason of unlawful dismissal. 32
It is clear from the foregoing summary of legal provisions and
jurisprudence that there must generally be unjust or illegal dismissal from
work, before reinstatement and backwages may be granted. And in cases
where reinstatement is not possible or when dismissal is due to valid causes,
separation pay may be granted. cdphil

Private respondents contend that they were terminated for failure to

submit to the controversial "screening" requirement.
Public respondent Commission took the opposite view and held:
"As the evidence on the record will show, respondents were not
actually terminated from the service. They were merely made to submit
to a screening committee as a prerequisite for readmission to work.
While this condition was found not wholly justified, the fact remains that
respondents who are resistant to such procedure are partly responsible
for the delay in their readmission back to work. Thus, We find justifiable
basis in further modifying our resolution of January 14, 1991 in
accordance with the equities of the case.
We shall therefore recall the award for backwages for lack of
factual and legal basis. The award for separation pay shall likewise (be)
reasonably reduced. Normally, severance benefit is granted as an
alternative remedy to reinstatement. And since there is no dismissal to
speak of, there is no basis for awarding reinstatement as a legal remedy.
In lieu thereof, We shall grant herein respondents separation pay as and
by way of financial assistance in the nature of an equitable relief.'" 33
We find that private respondents were indeed dismissed when INPORT
refused to accept them back to work after the former refused to submit to the
"screening" process.
Applying the law (Article 264 of the Labor Code) which makes a
distinction, we differentiate between the union members and the union officers
among private respondents in granting the reliefs prayed for.
 Under Article 264 of the Labor Code, a worker merely participating in an
illegal strike may not be terminated from his employment. It is only when he
commits illegal acts during a strike that he may be declared to have lost his
employment status. Since there appears no proof that these union members
committed illegal acts during the strike, they cannot be dismissed. The striking
union members among private respondents are thus entitled to reinstatement,
there being no just cause for their dismissal.
However, considering that a decade has already lapsed from the time
the disputed strike occurred, we find that to award separation pay in lieu of
reinstatement would be more practical and appropriate.
No backwages will be awarded to private respondent-union members
as a penalty for their participation in the illegal strike. Their continued
participation in said strike, even after most of their co-workers had returned to
work, can hardly be rewarded by such an award.
The fate of private respondent-union officers is different. Their
insistence on unconditional reinstatement or separation pay and backwages is
unwarranted and unjustified. For knowingly participating in an illegal strike, the
law mandates that a union officer may be terminated from employment. 34
Notwithstanding the fact that INPORT previously accepted other union
officers and that the screening required by it was uncalled for, still it cannot be
gainsaid that it possessed the right and prerogative to terminate the union
officers from service. The law, in using the word may, grants the employer the
option of declaring a union officer who participated in an illegal strike as
having lost his employment. 35
Moreover, an illegal strike which, more often than not, brings about
unnecessary economic disruption and chaos in the workplace should not be
countenance by a relaxation of the sanctions prescribed by law.
The union officers are, therefore, not entitled to any relief.
However, the above disquisition is now considered moot and academic
and cannot be effected in view of a manifestation filed by INPORT dated May
15, 1987. 36 In said Manifestation, it attached a Certification by the President
of the Macajalar Labor Union (MLU-FFW) to the effect that the private
respondents/remaining strikers have ceased to be members of said union.
The MLU-FFW had an existing collective bargaining agreement with INPORT
containing a union security clause. Article 1 Section 2 (b) of the CBA provides:
"The corporation shall discharge, dismiss or terminate any
employee who may be a member of the Union but losses his good
standing with the Union and or corporation, upon proper notice of such
fact made by latter; provided, however, . . . after they shall have received
the regular appointment as a condition for his continued employment
with the corporation. . . . " 37
 Since private respondents (union members) are no longer members of
the MLU, they cannot be reinstated. In lieu of reinstatement, which was a
proper remedy before May 1987 when they were dismissed from the union,
we award them separation pay. We find that to award one month salary for
every year of service until 1985, after April of which year they no longer
formed part of INPORT's productive work force partly through their own fault,
is a fair settlement.
Finally, there is no merit in INPORT's statement that a Resolution of the
NLRC cannot be modified upon reconsideration after the lapse of an
unreasonable period of time. Under the present circumstance, a period of
eleven months is not an unreasonable length of time. The Resolution of the
public respondent dated January 14, 1991 did not acquire finality in view of
the timely filing of a motion for reconsideration. Hence, the Commission's
modified Resolution issued on December 12, 1991 is valid and in accordance
with law.cdrep

In sum, reinstatement and backwages or, if no longer feasible,

separation pay, can only be granted if sufficient bases exist under the law,
particularly after a showing of illegal dismissal. However, while the union
members may thus be entitled under the law to be reinstated or to receive
separation pay, their expulsion from the union in accordance with the
collective bargaining agreement renders the same impossible.
The NLRC's award of separation pay as "equitable relief" and
P1,000.00 as compensation should be deleted, these being incompatible with
our findings detailed above.
WHEREFORE, from the foregoing premises, the petition in G.R.
No. 103560 ("Gold City Integrated Port Service, Inc. v. National Labor
Relations Commission, et al.") is GRANTED. One month salary for each year
of service until 1985 is awarded to private respondents who were not union
officer as separation pay. The petition in G.R. No. 103599 ("Adelo Ebuna, et
al. v. National Labor Relations Commission, et al.") is DISMISSED for lack of
merit. No costs.
SO ORDERED.
(Gold City Integrated Port Service, Inc. v. National Labor Relations Commission,
|||

G.R. Nos. 103560 & 103599, [July 6, 1995], 315 PHIL 698-716)

[G.R. No. 142824. December 19, 2001.]

 INTERPHIL LABORATORIES EMPLOYEES UNION-FFW,
ENRICO GONZALES and MA. THERESA
MONTEJO,petitioners, vs. INTERPHIL LABORATORIES, INC.,
AND HONORABLE LEONARDO A. QUISUMBING, SECRETARY
OF LABOR AND EMPLOYMENT, respondents.

Allan S. Montano for petitioners.

Castillo Laman Tan Pantaleon & San Jose Law Offices for private
respondent.

SYNOPSIS

Interphil Laboratories Employees Union-FFW is the sole and exclusive

bargaining agent of the rank and file employees of Interphil Laboratories, Inc.
The company had a Collective Bargaining Agreement (CBA) effective from 01
August 1990 to 31 July 1993. A few months before the expiration of the CBA,
some union officers wanted to discuss with the company vice-president for
human resources the details of a new CBA. Upon failure to have a positive
reaction, all the rank-and-file employees of the company started a work
slowdown and an overtime boycott. Later on, the company filed with the National
Labor Relations Commission (NLRC) a petition to declare illegal the union's
overtime boycott and work slowdown, which the company considered to be an
illegal strike. Meanwhile, the parties tried to settle things, but failed. The
Petitioner union staged a strike. The Secretary of Labor issued an assumption
order over the labor dispute and issued a return-to-work order. In the meantime,
the labor arbiter submitted his recommendation on the case filed by the
Company. The Secretary of Labor adopted the recommendation declaring the
overtime boycott and work slowdown as an illegal strike and declared the union
officers concerned to have lost their employment status. Petitioners moved for its
reconsideration, but was denied. The union went to the Court of Appeals, but the
appellate court dismissed the petition. Hence, this petition for certiorari before the
Supreme Court.
The petition was denied due course and the decision of the Court of
Appeals was affirmed. According to the Court, the members of the union
admitted in their petition that they decided not to render overtime. Such
admission confirmed the allegation of respondent company that petitioners
engaged in overtime boycott and work slowdown which, according to the labor
arbiter, was taken as a means to coerce the company to yield to their
unreasonable demands. More importantly, such acts by the employees
constituted a violation of their CBA. Also, the Court could not agree with the
petitioners that in extending substantial separation package to some officers of
the union, the respondent company in effect condoned the illegal acts they
committed. The Court viewed the gesture of the respondent company as an act
of generosity for which it should not be punished. CaDSHE

SYLLABUS

1. LABOR AND SOCIAL LEGISLATIONS; LABOR CODE; SECRETARY

OF LABOR AND EMPLOYMENT; VESTED WITH JURISDICTION OVER
LABOR AND LABOR-RELATED DISPUTES; CONSTRUED. — The appellate
court also correctly held that the question of the Secretary of Labor and
Employment's jurisdiction over labor and labor-related disputes was already
settled inInternational Pharmaceutical, Inc. vs. Hon. Secretary of Labor and
Associated Labor Union (ALU) where the Court declared: In the present case,
the Secretary was explicitly granted by Article 263(g) of the Labor Code the
authority to assume jurisdiction over a labor dispute causing or likely to cause a
strike or lockout in an industry indispensable to the national interest, and decide
the same accordingly. Necessarily, this authority to assume jurisdiction over the
said labor dispute must include and extend to all questions and controversies
arising therefrom, including cases over which the labor arbiter has exclusive
jurisdiction. Moreover, Article 217 of the Labor Code is not without, but
contemplates, exceptions thereto. This is evident from the
opening proviso therein reading '(e)xcept as otherwise provided under this Code .
. . .' Plainly, Article 263(g) of the Labor Code was meant to make both the
Secretary (or the various regional directors) and the labor arbiters share
jurisdiction, subject to certain conditions. Otherwise, the Secretary would not be
able to effectively and efficiently dispose of the primary dispute. To hold the
contrary may even lead to the absurd and undesirable result wherein the
Secretary and the labor arbiter concerned may have diametrically opposed
rulings. As we have said, '(i)t is fundamental that a statute is to be read in a
manner that would breathe life into it, rather than defeat it. In fine, the issuance of
the assailed orders is within the province of the Secretary as authorized by
Article 263(g) of the Labor Code and Article 217(a) and (5) of the same Code,
taken conjointly and rationally construed to subserve the objective of the
jurisdiction vested in the Secretary.
2. REMEDIAL LAW; EVIDENCE; FACTUAL FINDINGS OF THE LABOR
ARBITER; WHEN ACCORDED DUE RESPECT BY THE SUPREME COURT;
CASE AT BAR. — Anent the alleged misappreciation of the evidence proffered
by the parties, it is axiomatic that the factual findings of the Labor Arbiter, when
sufficiently supported by the evidence on record, must be accorded due respect
by the Supreme Court. Here, the report and recommendation of Labor Arbiter
Caday was not only adopted by then Secretary of Labor Quisumbing but it was
likewise affirmed by the Court of Appeals. DAESTI
 3. ID.; ID.; PAROL EVIDENCE RULE; NOT APPLICABLE IN LABOR
CASES; EFFECT THEREOF; CASE AT BAR. — The reliance on the parol
evidence rule is misplaced. In labor cases pending before the Commission or the
Labor Arbiter, the rules of evidence prevailing in courts of law or equity are not
controlling. Rules of procedure and evidence are not applied in a very rigid and
technical sense in labor cases. Hence, the Labor Arbiter is not precluded from
accepting and evaluating evidence other than, and even contrary to, what is
stated in the CBA. In any event, the parties stipulated: Section 1. Regular
Working Hours — A normal workday shall consist of not more than eight (8)
hours. The regular working hours for the Company shall be from 7:30 A.M. to
4:30 P.M. The schedule of shift work shall be maintained; however the company
may change the prevailing work time at its discretion, should such change be
necessary in the operations of the Company. All employees shall observe such
rules as have been laid down by the company for the purpose of effecting control
over working hours. It is evident from the foregoing provision that the working
hours may be changed, at the discretion of the company, should such change be
necessary for its operations, and that the employees shall observe such rules as
have been laid down by the company. In the case before us, Labor Arbiter Caday
found that respondent company had to adopt a continuous 24-hour work daily
schedule by reason of the nature of its business and the demands of its clients. It
was established that the employees adhered to the said work schedule since
1988. The employees are deemed to have waived the eight-hour schedule since
they followed, without any question or complaint, the two-shift schedule while
their CBA was still in force and even prior thereto. The two-shift schedule
effectively changed the working hours stipulated in the CBA. As the employees
assented by practice to this arrangement, they cannot now be heard to claim that
the overtime boycott is justified because they were not obliged to work beyond
eight hours.

DECISION

KAPUNAN, J : p

Assailed in this petition for review on certiorari are the decision,

promulgated on 29 December 1999, and the resolution, promulgated on 05 April
2000, of the Court of Appeals in CA-G.R. SP No. 50978.
Culled from the questioned decision, the facts of the case are as follows:
Interphil Laboratories Employees Union-FFW is the sole and exclusive
bargaining agent of the rank-and-file employees of Interphil Laboratories, Inc., a
company engaged in the business of manufacturing and packaging
pharmaceutical products. They had a Collective Bargaining Agreement (CBA)
effective from 01 August 1990 to 31 July 1993.
Prior to the expiration of the CBA or sometime in February 1993,
Allesandro G. Salazar, 1 Vice-President-Human Resources Department of
respondent company, was approached by Nestor Ocampo, the union president,
and Hernando Clemente, a union director. The two union officers inquired about
the stand of the company regarding the duration of the CBA which was set to
expire in a few months. Salazar told the union officers that the matter could be
best discussed during the formal negotiations which would start soon.
In March 1993, Ocampo and Clemente again approached Salazar. They
inquired once more about the CBA status and received the same reply from
Salazar. In April 1993, Ocampo requested for a meeting to discuss the duration
and effectivity of the CBA. Salazar acceded and a meeting was held on 15 April
1993 where the union officers asked whether Salazar would be amenable to
make the new CBA effective for two (2) years, starting 01 August 1993. Salazar,
however, declared that it would still be premature to discuss the matter and that
the company could not make a decision at the moment. The very next day, or on
16 April 1993, all the rank-and-file employees of the company refused to follow
their regular two-shift work schedule of from 6:00 a.m. to 6:00 p.m., and from
6:00 p.m. to 6:00 a.m. At 2:00 p.m. and 2:00 a.m., respectively, the employees
stopped working and left their workplace without sealing the containers and
securing the raw materials they were working on. When Salazar inquired about
the reason for their refusal to follow their normal work schedule, the employees
told him to "ask the union officers." To minimize the damage the overtime boycott
was causing the company, Salazar immediately asked for a meeting with the
union officers. In the meeting, Enrico Gonzales, a union director, told Salazar that
the employees would only return to their normal work schedule if the company
would agree to their demands as to the effectivity and duration of the new CBA.
Salazar again told the union officers that the matter could be better discussed
during the formal renegotiations of the CBA. Since the union was apparently
unsatisfied with the answer of the company, the overtime boycott continued. In
addition, the employees started to engage in a work slowdown campaign during
the time they were working, thus substantially delaying the production of the
company. 2
On 14 May 1993, petitioner union submitted with respondent company its
CBA proposal, and the latter filed its counter-proposal.
On 03 September 1993, respondent company filed with the National Labor
Relations Commission (NLRC) a petition to declare illegal petitioner union's
"overtime boycott" and "work slowdown" which, according to respondent
company, amounted to illegal strike. The case, docketed NLRC-NCR Case No.
00-09-05529-93, was assigned to Labor Arbiter Manuel R. Caday.
 On 22 October 1993, respondent company filed with the National
Conciliation and Mediation Board (NCMB) an urgent request for preventive
mediation aimed to help the parties in their CBA negotiations. 3 The parties,
however, failed to arrive at an agreement and on 15 November 1993, respondent
company filed with the Office of the Secretary of Labor and Employment a
petition for assumption of jurisdiction.
On 24 January 1994, petitioner union filed with the NCMB a Notice of
Strike citing unfair labor practice allegedly committed by respondent company.
On 12 February 1994, the union staged a strike.
On 14 February 1994, Secretary of Labor Nieves Confesor issued an
assumption order 4 over the labor dispute. On 02 March 1994, Secretary
Confesor issued an order directing respondent company to "immediately accept
all striking workers, including the fifty-three (53) terminated union officers, shop
stewards and union members back to work under the same terms and conditions
prevailing prior to the strike, and to pay all the unpaid accrued year end benefits
of its employees in 1993." 5 On the other hand, petitioner union was directed to
"strictly and immediately comply with the return-to-work orders issued by (the)
Office . . .." 6 The same order pronounced that "(a)ll pending cases which are
direct offshoots of the instant labor dispute are hereby subsumed herewith." 7
In the interim, the case before Labor Arbiter Caday continued. On 16
March 1994, petitioner union filed an "Urgent Manifestation and Motion to
Consolidate the Instant Case and to Suspend Proceedings" seeking the
consolidation of the case with the labor dispute pending before the Secretary of
Labor. Despite objection by respondent company, Labor Arbiter Caday held in
abeyance the proceedings before him. However, on 06 June 1994, Acting Labor
Secretary Jose S. Brillantes, after finding that the issues raised would require a
formal hearing and the presentation of evidentiary matters, directed Labor
Arbiters Caday and M. Sol del Rosario to proceed with the hearing of the cases
before them and to thereafter submit their report and recommendation to his
office.
On 05 September 1995, Labor Arbiter Caday submitted his
recommendation to the then Secretary of Labor Leonardo A. Quisumbing. 8 Then
Secretary Quisumbing approved and adopted the report in his Order, dated 13
August 1997, hence:
WHEREFORE, finding the said Report of Labor Arbiter Manuel R.
Caday to be supported by substantial evidence, this Office hereby
RESOLVES to APPROVE and ADOPT the same as the decision in this
case, and judgment is hereby rendered:
(1) Declaring the 'overtime boycott' and 'work slowdown' as illegal
strike;
 (2) Declaring the respondent union officers namely:
Nestor Ocampo President
Carmelo Santos Vice-President
Marites Montejo Treasurer/Board Member
Rico Gonzales Auditor
Rod Abuan Director
Segundino Flores Director
Hernando Clemente Director
who spearheaded and led the overtime boycott and work
slowdown, to have lost their employment status; and
(3) Finding the respondents guilty of unfair labor practice for
violating the then existing CBA which prohibits the union or
any employee during the existence of the CBA from
staging a strike or engaging in slowdown or interruption of
work and ordering them to cease and desist from further
committing the aforesaid illegal acts.
Petitioner union moved for the reconsideration of the order but its motion
was denied. The union went to the Court of Appeals via a petition for certiorari. In
the now questioned decision promulgated on 29 December 1999, the appellate
court dismissed the petition. The union's motion for reconsideration was likewise
denied.
Hence, the present recourse where petitioner alleged:
THE HONORABLE FIFTH DIVISION OF THE COURT OF
APPEALS, LIKE THE HONORABLE PUBLIC RESPONDENT IN THE
PROCEEDINGS BELOW, COMMITTED GRAVE ABUSE OF
DISCRETION, AMOUNTING TO LACK AND/OR EXCESS OF
JURISDICTION WHEN IT COMPLETELY DISREGARDED "PAROL
EVIDENCE RULE" IN THE EVALUATION AND APPRECIATION OF
EVIDENCE PROFERRED BY THE PARTIES.
THE HONORABLE FIFTH DIVISION OF THE COURT OF
APPEALS COMMITTED GRAVE ABUSE OF DISCRETION,
AMOUNTING TO LACK AND/OR EXCESS OF JURISDICTION, WHEN
IT DID NOT DECLARE PRIVATE RESPONDENT'S ACT OF
EXTENDING SUBSTANTIAL SEPARATION PACKAGE TO ALMOST
ALL INVOLVED OFFICERS OF PETITIONER UNION, DURING THE
PENDENCY OF THE CASE, AS TANTAMOUNT TO CONDONATION,
IF INDEED, THERE WAS ANY MISDEED COMMITTED.
THE HONORABLE FIFTH DIVISION OF THE COURT OF
APPEALS COMMITTED GRAVE ABUSE OF DISCRETION,
AMOUNTING TO LACK AND/OR EXCESS OF JURISDICTION WHEN
IT HELD THAT THE SECRETARY OF LABOR AND EMPLOYMENT
HAS JURISDICTION OVER A CASE (A PETITION TO DECLARE
 STRIKE ILLEGAL) WHICH HAD LONG BEEN FILED AND PENDING
BEFORE THE LABOR ARBITER. 9
We sustain the questioned decision.
On the matter of the authority and jurisdiction of the Secretary of Labor and
Employment to rule on the illegal strike committed by petitioner union, it is
undisputed that the petition to declare the strike illegal before Labor Arbiter
Caday was filed long before the Secretary of Labor and Employment issued the
assumption order on 14 February 1994. However, it cannot be denied that the
issues of "overtime boycott" and "work slowdown" amounting to illegal strike
before Labor Arbiter Caday are intertwined with the labor dispute before the
Labor Secretary. In fact, on 16 March 1994, petitioner union even asked Labor
Arbiter Caday to suspend the proceedings before him and consolidate the same
with the case before the Secretary of Labor. When Acting Labor Secretary
Brillantes ordered Labor Arbiter Caday to continue with the hearing of the illegal
strike case, the parties acceded and participated in the proceedings, knowing
fully well that there was also a directive for Labor Arbiter Caday to thereafter
submit his report and recommendation to the Secretary. As the appellate court
pointed out, the subsequent participation of petitioner union in the continuation of
the hearing was in effect an affirmation of the jurisdiction of the Secretary of
Labor.
The appellate court also correctly held that the question of the Secretary of
Labor and Employment's jurisdiction over labor and labor-related disputes was
already settled in International Pharmaceutical, Inc. vs. Hon. Secretary of Labor
and Associated Labor Union (ALU) 10 where the Court declared:
In the present case, the Secretary was explicitly granted by Article
263(g) of the Labor Code the authority to assume jurisdiction over a
labor dispute causing or likely to cause a strike or lockout in an industry
indispensable to the national interest, and decide the same accordingly.
Necessarily, this authority to assume jurisdiction over the said labor
dispute must include and extend to all questions and controversies
arising therefrom, including cases over which the labor arbiter has
exclusive jurisdiction.
Moreover, Article 217 of the Labor Code is not without, but
contemplates, exceptions thereto. This is evident from the opening
proviso therein reading '(e)xcept as otherwise provided under this Code .
. .' Plainly, Article 263(g) of the Labor Code was meant to make both the
Secretary (or the various regional directors) and the labor arbiters share
jurisdiction, subject to certain conditions. Otherwise, the Secretary would
not be able to effectively and efficiently dispose of the primary dispute.
To hold the contrary may even lead to the absurd and undesirable result
wherein the Secretary and the labor arbiter concerned may have
diametrically opposed rulings. As we have said, '(i)t is fundamental that a
 statute is to be read in a manner that would breathe life into it, rather
than defeat it.
In fine, the issuance of the assailed orders is within the province
of the Secretary as authorized by Article 263(g) of the Labor Code and
Article 217(a) and (5) of the same Code, taken conjointly and rationally
construed to subserve the objective of the jurisdiction vested in the
Secretary. 11
Anent the alleged misappreciation of the evidence proffered by the parties,
it is axiomatic that the factual findings of the Labor Arbiter, when sufficiently
supported by the evidence on record, must be accorded due respect by the
Supreme Court. 12 Here, the report and recommendation of Labor Arbiter Caday
was not only adopted by then Secretary of Labor Quisumbing but was likewise
affirmed by the Court of Appeals. We see no reason to depart from their findings.
Petitioner union maintained that the Labor Arbiter and the appellate court
disregarded the "parol evidence rule" 13when they upheld the allegation of
respondent company that the work schedule of its employees was from 6:00 a.m.
to 6:00 p.m. and from 6:00 p.m. to 6:00 am. According to petitioner union, the
provisions of their CBA on working hours clearly stated that the normal working
hours were "from 7:30 a.m. to 4:30 p.m." 14 Petitioner union underscored that the
regular work hours for the company was only eight (8) hours. It further contended
that the Labor Arbiter as well as the Court of Appeals should not have admitted
any other evidence contrary to what was stated in the CBA.
The reliance on the parol evidence rule is misplaced. In labor cases
pending before the Commission or the Labor Arbiter, the rules of evidence
prevailing in courts of law or equity are not controlling. 15 Rules of procedure and
evidence are not applied in a very rigid and technical sense in labor
cases. 16 Hence, the Labor Arbiter is not precluded from accepting and
evaluating evidence other than, and even contrary to, what is stated in, the CBA.
In any event, the parties stipulated:
Section 1. Regular Working Hours — A normal workday shall
consist of not more than eight (8) hours. The regular working hours for
the Company shall be from 7:30 A.M. to 4:30 P.M. The schedule of shift
work shall be maintained; however the company may change the
prevailing work time at its discretion, should such change be necessary
in the operations of the Company. All employees shall observe such
rules as have been laid down by the company for the purpose of
effecting control over working hours. 17
It is evident from the foregoing provision that the working hours may be
changed, at the discretion of the company, should such change be necessary for
its operations, and that the employees shall observe such rules as have been
laid down by the company. In the case before us, Labor Arbiter Caday found that
respondent company had to adopt a continuous 24-hour work daily schedule by
reason of the nature of its business and the demands of its clients. It was
established that the employees adhered to the said work schedule since 1988.
The employees are deemed to have waived the eight-hour schedule since they
followed, without any question or complaint, the two-shift schedule while their
CBA was still in force and even prior thereto. The two-shift schedule effectively
changed the working hours stipulated in the CBA. As the employees assented by
practice to this arrangement, they cannot now be heard to claim that the overtime
boycott is justified because they were not obliged to work beyond eight hours.
As Labor Arbiter Caday elucidated in his report:
Respondents' attempt to deny the existence of such regular
overtime schedule is belied by their own awareness of the existence of
the regular overtime schedule of 6:00 A.M. to 6:00 P.M. and 6:00 P.M. to
6:00 A.M. of the following day that has been going on since 1988. Proof
of this is the case undisputedly filed by the union for and in behalf of its
members, wherein it is claimed that the company has not been
computing correctly the night premium and overtime pay for work
rendered between 2:00 A.M. and 6:00 A.M. of the 6:00 P.M. to 6:00 A.M.
shift. (tsn pp. 9-10, testimony of Alessandro G. Salazar during hearing
on August 9, 1994). In fact, the union Vice-President Carmelo C. Santos,
demanded that the company make a recomputation of the overtime
records of the employees from 1987 (Exh. "P"). Even their own witness,
union Director Enrico C. Gonzales, testified that when in 1992 he was
still a Quality Control Inspector at the Sucat Plant of the company, his
schedule was sometime at 6:00 A.M. to 6:00 P.M., sometime at 6:00
A.M. to 2:00 P.M., at 2:00 P.M. to 10:00 P.M. and sometime at 6:00 P.M.
to 6:00 A.M., and when on the 6 to 6 shifts, he received the
commensurate pay (t.s.n. pp. 7-9, hearing of January 10, 1994).
Likewise, while in the overtime permits, dated March 1, 6, 8, 9 to 12,
1993, which were passed around daily for the employees to sign, his
name appeared but without his signatures, he however had rendered
overtime during those dates and was paid because unlike in other
departments, it has become a habit to them to sign the overtime
schedule weekly (t.s.n. pp. 26-31, hearing of January 10, 1994). The
awareness of the respondent union, its officers and members about the
existence of the regular overtime schedule of 6:00 A.M. to 6:00 P.M. and
6:00 P.M. to 6:00 A.M. of the following day will be further shown in the
discussion of the second issue. 18
As to the second issue of whether or not the respondents have
engaged in "overtime boycott" and "work slowdown" from April 16, 1993
up to March 7, 1994, both amounting to illegal strike, the evidence
presented is equally crystal clear that the "overtime boycott" and "work
slowdown" committed by the respondents amounted to illegal strike.
 As undisputably testified to by Mr. Alessandro G. Salazar, the
company's Vice-President-Human Resources Department, sometime in
February, 1993, he was approached by the union President Nestor
Ocampo and Union Director Hernando Clemente who asked him as to
what was the stand of the company regarding the duration of the CBA
between the company and which was set to expire on July 31, 1993. He
answered that the matter could be best discussed during the formal
renegotiations which anyway was to start soon. This query was followed
up sometime in March, 1993, and his answer was the same. In early
April, 1993, the union president requested for a meeting to discuss the
duration and effectivity of the CBA. Acceding to the request, a meeting
was held on April 15, 1993 wherein the union officers asked him if he
would agree to make the new CBA effective on August 1, 1993 and the
term thereof to be valid for only two (2) years. When he answered that it
was still premature to discuss the matter, the very next day, April 16,
1993, all the rank and file employees of the company refused to follow
their regular two-shift work schedule of 6:00 A.M. to 6:00 P.M. and 6:00
P.M. to 6:00 A.M., when after the 8-hours work, they abruptly stopped
working at 2:00 P.M. and 2:00 A.M., respectively, leaving their place of
work without sealing the containers and securing the raw materials they
were working on. When he saw the workers leaving before the end of
their shift, he asked them why and their reply was "asked (sic) the union
officers." Alarmed by the overtime boycott and the damage it was
causing the company, he requested for a meeting with the union officers.
In the meeting, he asked them why the regular work schedule was not
being followed by the employees, and union Director Enrico Gonzales,
with the support of the other union officers, told him that if management
would agree to a two-year duration for the new CBA and an effectivity
date of August 1, 1993, all employees will return to the normal work
schedule of two 12-hour shifts. When answered that the management
could not decide on the matter at the moment and to have it discussed
and agreed upon during the formal renegotiations, the overtime boycott
continued and the employees at the same time employed a work
slowdown campaign during working hours, causing considerable delay in
the production and complaints from the clients/customers (Exh. "O",
Affidavit of Alessandro G. Salazar which formed part of his direct
testimony). This testimonial narrations of Salazar was, as earlier said,
undisputed because the respondents' counsel waived his cross
examination (t.s.n. p. 15, hearing on August 9, 1994).
Aside from the foregoing undisputed testimonies of Salazar, the
testimonies of other Department Managers pointing to the union officers
as the instigators of the overtime boycott and work slowdown, the
testimony of Epifanio Salumbides (Exh. "Y") a union member at the time
the concerted activities of the respondents took place, is quoted
hereunder:
 "2. Noon Pebrero 1993, ipinatawag ng Presidente ng
Unyon na si Nestor Ocampo ang lahat ng taga-maintenance ng
bawat departamento upang dumalo sa isang miting. Sa miting na
iyon, sinabi ni Rod Abuan, na isang Direktor ng Unyon, na
mayroon ilalabas na memo ang Unyon na nag-uutos sa mga
empleyado ng Kompanya na mag-imbento ng sari-saring dahilan
para lang hindi sila makapagtrabaho ng "overtime". Sinabihan rin
ako ni Tessie Montejo na siya namang Treasurer ng Unyon na
'Manny, huwag ka na lang pumasok sa Biyernes para hindi ka
masabihan ng magtrabaho ng Sabado at Linggo' na siya namang
araw ng "overtime" ko . . .
"3. Nakalipas ang dalawang buwan at noong unang bahagi
ng Abril 1993, miniting kami ng Shop Stewards namin na sina
Ariel Abenoja, Dany Tansiongco at Vicky Baron. Sinabihan kami
na huwag ng mag-overtime pag nagbigay ng senyas ang Unyon
ng "showtime."
"4. Noong umaga ng ika-15 ng Abril 1993, nagsabi na si
Danny Tansiongco ng "showtime". Dahil dito wala ng
empleyadong nag-overtime at sabay-sabay silang umalis,
maliban sa akin. Ako ay pumasok rin noong Abril 17 at 18, 1993
na Sabado at Linggo.
"5. Noong ika-19 ng Abril 1993, ako ay ipinatawag ni Ariel
Abenoja Shop Steward, sa opisina ng Unyon. Nadatnan ko doon
ang halos lahat ng opisyales ng Unyon na sina:
Nestor Ocampo Presidente
Carmelo Santos Bise-Presidente
Nanding Clemente Director
Tess Montejo Chief Steward
Segundo Flores Director
Enrico Gonzales Auditor
Boy Alcantara Shop Steward
Rod Abuan Director
at marami pang iba na hindi ko na maala-ala. Pagpasok
ko, ako'y pinaligiran ng mga opisyales ng Unyon. Tinanong ako ni
Rod Aguan kung bakit ako "nag-overtime" gayong "Binigyan ka
na namin ng instruction na huwag pumasok, pinilit mo pa ring
pumasok." "Management ka ba o Unyonista." Sinagot ko na ako
ay Unyonista. Tinanong niya muli kung bakit ako pumasok. Sinabi
ko na wala akong maibigay na dahilan para lang hindi pumasok at
"mag-overtime." Pagkatapos nito, ako ay pinagmumura ng mga
opisyales ng Unyon kaya't ako ay madaliang umalis.
xxx xxx xxx
 Likewise, the respondents' denial of having a hand in the work
slowdown since there was no change in the performance and work
efficiency for the year 1993 as compared to the previous year was even
rebuffed by their witness Ma. Theresa Montejo, a Quality Control
Analyst. For on cross-examination, she (Montejo) admitted that she
could not answer how she was able to prepare the productivity reports
from May 1993 to February 1994 because from April 1993 up to April
1994, she was on union leave. As such, the productivity reports she had
earlier shown was not prepared by her since she had no personal
knowledge of the reports (t.s.n. pp. 32-35, hearing of February 27,
1995). Aside from this admission, the comparison made by the
respondents was of no moment, because the higher production for the
years previous to 1993 was reached when the employees regularly
rendered overtime work. But undeniably, overtime boycott and work
slowdown from April 16, 1993 up to March 7, 1994 had resulted not only
in financial losses to the company but also damaged its business
reputation.

Evidently, from all the foregoing, respondents' unjustified

unilateral alteration of the 24-hour work schedule thru their concerted
activities of "overtime boycott" and "work slowdown" from April 16, 1993
up to March 7, 1994, to force the petitioner company to accede to their
unreasonable demands, can be classified as a strike on an installment
basis, as correctly called by petitioner company . . . . 19
It is thus undisputed that members of the union by their own volition
decided not to render overtime services in April 1993. 20 Petitioner union even
admitted this in its Memorandum, dated 12 April 1999, filed with the Court of
Appeals, as well as in the petition before this Court, which both stated that
"(s)ometime in April 1993, members of herein petitioner, on their own volition and
in keeping with the regular working hours in the Company . . . decided not to
render overtime." 21 Such admission confirmed the allegation of respondent
company that petitioner engaged in "overtime boycott" and "work slowdown"
which, to use the words of Labor Arbiter Caday, was taken as a means to coerce
respondent company to yield to its unreasonable demands.
More importantly, the "overtime boycott" or "work slowdown" by the
employees constituted a violation of their CBA, which prohibits the union or
employee, during the existence of the CBA, to stage a strike or engage in
slowdown or interruption of work. 22 In Ilaw at Buklod ng Manggagawa
vs. NLRC, 23 this Court ruled:
. . . (T)he concerted activity in question would still be illicit
because contrary to the workers' explicit contractual commitment "that
there shall be no strikes, walkouts, stoppage or slowdown of work,
 boycotts, secondary boycotts, refusal to handle any merchandise,
picketing, sit-down strikes of any kind, sympathetic or general strikes, or
any other interference with any of the operations of the COMPANY
during the term of . . . (their collective bargaining) agreement."
What has just been said makes unnecessary resolution of SMC's
argument that the workers' concerted refusal to adhere to the work
schedule in force for the last several years, is a slowdown, an inherently
illegal activity essentially illegal even in the absence of a no-strike clause
in a collective bargaining contract, or statute or rule. The Court is in
substantial agreement with the petitioner's concept of a slowdown as a
"strike on the installment plan;" as a willful reduction in the rate of work
by concerted action of workers for the purpose of restricting the output of
the employer, in relation to a labor dispute; as an activity by which
workers, without a complete stoppage of work, retard production or their
performance of duties and functions to compel management to grant
their demands. The Court also agrees that such a slowdown is generally
condemned as inherently illicit and unjustifiable, because while the
employees "continue to work and remain at their positions and accept
the wages paid to them," they at the same time "select what part of their
allotted tasks they care to perform of their own volition or refuse openly
or secretly, to the employer's damage, to do other work;" in other words,
they "work on their own terms." . . . 24
Finally, the Court cannot agree with the proposition that respondent
company, in extending substantial separation package to some officers of
petitioner union during the pendency of this case, in effect, condoned the illegal
acts they committed.
Respondent company correctly postured that at the time these union
officers obtained their separation benefits, they were still considered employees
of the company. Hence, the company was merely complying with its legal
obligations. 25Respondent company could have withheld these benefits pending
the final resolution of this case. Yet, considering perhaps the financial hardships
experienced by its employees and the economic situation prevailing, respondent
company chose to let its employees avail of their separation benefits. The Court
views the gesture of respondent company as an act of generosity for which it
should not be punished.
WHEREFORE, the petition is DENIED DUE COURSE and the 29
December 1999 decision of the Court of Appeals is AFFIRMED.
SO ORDERED.
(Interphil Laboratories Employees Union v. Interphil Laboratories, Inc., G.R. No.
|||

142824, [December 19, 2001], 423 PHIL 948-965)

 [G.R. No. 119293. June 10, 2003.]

SAN MIGUEL CORPORATION, petitioner, vs. NATIONAL

LABOR RELATIONS COMMISSION, Second Division, ILAW AT
BUKLOD NG MANGGAGAWA (IBM), respondents.

Office of the General Counsel for petitioner.

Solicitor General for public respondent.
Potenciano A. Flores, Jr. for Ilaw at Buklod ng Manggagawa.

SYNOPSIS

Petitioner sought a permanent injunction to enjoin the respondent's strike.

The NLRC initially issued a temporary restraining order. Subsequently, despite
lack of a valid notice of strike and the union's failure to observe the CBA
provisions on grievance and arbitration, the NLRC denied the petition for
injunction for lack of factual basis.
On certiorari, the Supreme Court held that the NLRC committed grave
abuse of discretion when it denied the petition for injunction. Contrary to the
NLRC'S finding, at the time the injunction was being sought, there existed a
threat to revive the unlawful strike. Art. 264 (a) of the Labor Code explicitly states
that a declaration of strike without first having filed the required notice is a
prohibited activity, which may be prevented through an injunction in accordance
with Article 254 of the Labor Code.

SYLLABUS

1. LABOR AND SOCIAL LEGISLATION; LABOR CODE; LABOR

DISPUTE; NLRC HAS POWER TO ENJOIN OR RESTRAIN ACTUAL OR
THREATENED COMMISSION OF UNLAWFUL ACTS, OR TO REQUIRE
PERFORMANCE OF PARTICULAR ACTS THEREIN. — Article 254 of the Labor
Code provides that no temporary or permanent injunction or restraining order in
any case involving or growing out of labor disputes shall be issued by any court
or other entity except as otherwise provided in Articles 218 and 264 of the Labor
Code. Under the first exception, Article 218 (e) of the Labor Code expressly
confers upon the NLRC the power to "enjoin or restrain actual and threatened
commission of any or all prohibited or unlawful acts, or to require the
performance of a particular act in any labor dispute which, if not restrained or
performed forthwith, may cause grave or irreparable damage to any party or
render ineffectual any decision in favor of such party . . . ." The second
exception, on the other hand, is when the labor organization or the employer
engages in any of the "prohibited activities" enumerated in Article 264. Pursuant
to Article 218 (e), the coercive measure of injunction may also be used to restrain
an actual or threatened unlawful strike.
2. ID.; ID.; ID.; STRIKE; LACK OF VALID NOTICE TO STRIKE RENDERS
A STRIKE ILLEGAL; CASE AT BAR. — To be valid, a strike must be pursued
within legal bounds. One of the procedural requisites that Article 263 of the Labor
Code and its Implementing Rules prescribe is the filing of a valid notice of strike
with the NCMB. Imposed for the purpose of encouraging the voluntary settlement
of disputes, this requirement has been held to be mandatory, the lack of which
shall render a strike illegal. In the present case, NCMB converted IBM's notices
into preventive mediation as it found that the real issues raised are non-
strikeable. Such order is in pursuance of the NCMB's duty to exert "all efforts at
mediation and conciliation to enable the parties to settle the dispute amicably,"
and in line with the state policy of favoring voluntary modes of settling labor
disputes. In accordance with the Implementing Rules of the Labor Code, the said
conversion has the effect of dismissing the notices of strike filed by respondent.
A case in point is PAL v. Drilon, where we declared a strike illegal for lack of a
valid notice of strike, in view of the NCMB's conversion of the notice therein into a
preventive mediation case.
3. REMEDIAL LAW; SPECIAL CIVIL ACTIONS; CERTIORARI; GRAVE
ABUSE OF DISCRETION; NLRC's DENIAL OF INJUNCTIVE RELIEF TO
PREVENT UNION FROM DECLARING AN UNLAWFUL STRIKE, A CASE OF.
— It bears stressing that Article 264(a) of the Labor Code explicitly states that a
declaration of strike without first having filed the required notice is a prohibited
activity, which may be prevented through an injunction in accordance with Article
254. Clearly, public respondent should have granted the injunctive relief to
prevent the grave damage brought about by the unlawful strike . . . In the case
ofSan Miguel Corporation v. NLRC, where the same issue of NLRC's duty to
enjoin an unlawful strike was raised, we ruled that the NLRC committed grave
abuse of discretion when it denied the petition for injunction to restrain the union
from declaring a strike based on non-strikeable grounds. CAIaDT

DECISION

AZCUNA, J : p
 Before us is a petition for certiorari and prohibition seeking to set aside the
decision of the Second Division of the National Labor Relations Commission
(NLRC) in Injunction Case No. 00468-94 dated November 29, 1994, 1 and its
resolution dated February 1, 1995 2 denying petitioner's motion for
reconsideration.
Petitioner San Miguel Corporation (SMC) and respondent Ilaw at Buklod
ng Manggagawa (IBM), exclusive bargaining agent of petitioner's daily-paid rank
and file employees, executed a Collective Bargaining Agreement (CBA) under
which they agreed to submit all disputes to grievance and arbitration
proceedings. The CBA also included a mutually enforceable no-strike no-lockout
agreement. The pertinent provisions of the said CBA are quoted hereunder:
ARTICLE IV
GRIEVANCE MACHINERY
Section 1. The parties hereto agree on the principle that all
disputes between labor and management may be solved through friendly
negotiation; . . . that an open conflict in any form involves losses to the
parties, and that, therefore, every effort shall be exerted to avoid such an
open conflict. In furtherance of the foregoing principle, the parties hereto
have agreed to establish a procedure for the adjustment of grievances
so as to (1) provide an opportunity for discussion of any request or
complaint and (2) establish procedure for the processing and settlement
of grievances.
xxx xxx xxx
ARTICLE V
ARBITRATION
Section 1. Any and all disputes, disagreements and controversies
of any kind between the COMPANY and the UNION and/or the workers
involving or relating to wages, hours of work, conditions of employment
and/or employer-employee relations arising during the effectivity of this
Agreement or any renewal thereof, shall be settled by arbitration through
a Committee in accordance with the procedure established in this Article.
No dispute, disagreement or controversy which may be submitted to the
grievance procedure in Article IV shall be presented for arbitration until
all the steps of the grievance procedure are exhausted.
xxx xxx xxx
ARTICLE VI
STRIKES AND WORK STOPPAGES
Section 1. The UNION agrees that there shall be no strikes,
walkouts, stoppage or slowdown of work, boycotts, secondary boycotts,
 refusal to handle any merchandise, picketing, sit-down strikes of any
kind, sympathetic or general strikes, or any other interference with any of
the operations of the COMPANY during the term of this Agreement.
Section 2. The COMPANY agrees that there shall be no lockout
during the term of this Agreement so long as the procedure outlined in
Article IV hereof is followed by the UNION. 3
On April 11, 1994, IBM, through its vice-president Alfredo Colomeda, filed
with the National Conciliation and Mediation Board (NCMB) a notice of strike,
docketed as NCMB-NCR-NS-04-180-94, against petitioner for allegedly
committing: (1) illegal dismissal of union members, (2) illegal transfer, (3)
violation of CBA, (4) contracting out of jobs being performed by union members,
(5) labor-only contracting, (6) harassment of union officers and members, (7)
non-recognition of duly-elected union officers, and (8) other acts of unfair labor
practice. 4
The next day, IBM filed another notice of strike, this time through its
president Edilberto Galvez, raising similar grounds: (1) illegal transfer, (2) labor-
only contracting, (3) violation of CBA, (4) dismissal of union officers and
members, and (5) other acts of unfair labor practice. This was docketed as
NCMB-NCR-NS-04-182-94. 5
The Galvez group subsequently requested the NCMB to consolidate its
notice of strike with that of the Colomeda group,6 to which the latter opposed,
alleging Galvez's lack of authority in filing the same. 7
Petitioner thereafter filed a Motion for Severance of Notices of Strike with
Motion to Dismiss, on the grounds that the notices raised non-strikeable issues
and that they affected four corporations which are separate and distinct from
each other.8
After several conciliation meetings, NCMB Director Reynaldo Ubaldo found
that the real issues involved are non-strikeable. Hence on May 2, 1994, he
issued separate letter-orders to both union groups, converting their notices of
strike into preventive mediation. The said letter-orders, in part, read:
During the conciliation meetings, it was clearly established that
the real issues involved are illegal dismissal, labor-only contracting and
internal union disputes, which affect not only the interest of the San
Miguel Corporation but also the interests of the MAGNOLIA-NESTLE
CORPORATION, the SAN MIGUEL FOODS, INC., and the SAN
MIGUEL JUICES, INC.
Considering that San Miguel Corporation is the only impleaded
employer-respondent, and considering further that the aforesaid
companies are separate and distinct corporate entities, we deemed it
wise to reduce and treat your Notice of Strike as Preventive Mediation
 case for the four (4) different companies in order to evolve voluntary
settlement of the disputes. . . . 9 (Italics supplied)
On May 16, 1994, while separate preventive mediation conferences were
ongoing, the Colomeda group filed with the NCMB a notice of holding a strike
vote. Petitioner opposed by filing a Manifestation and Motion to Declare Notice of
Strike Vote Illegal, 10 invoking the case of PAL v. Drilon, 11 which held that no
strike could be legally declared during the pendency of preventive mediation.
NCMB Director Ubaldo in response issued another letter to the Colomeda Group
reiterating the conversion of the notice of strike into a case of preventive
mediation and emphasizing the findings that the grounds raised center only on
an intra-union conflict, which is not strikeable, thus:
xxx xxx xxx
A perusal of the records of the case clearly shows that the basic
point to be resolved entails the question of as to who between the two
(2) groups shall represent the workers for collective bargaining
purposes, which has been the subject of a Petition for Interpleader case
pending resolution before the Office of the Secretary of Labor and
Employment. Similarly, the other issues raised which have been
discussed by the parties at the plant level, are ancillary issues to the
main question, that is, the union leadership . . . 12 (Italics supplied)
Meanwhile, on May 23, 1994, the Galvez group filed its second notice of
strike against petitioner, docketed as NCMB-NCR-NS-05-263-94. Additional
grounds were set forth therein, including discrimination, coercion of employees,
illegal lockout and illegal closure. 13 The NCMB however found these grounds to
be mere amplifications of those alleged in the first notice that the group filed. It
therefore ordered the consolidation of the second notice with the preceding one
that was earlier reduced to preventive mediation. 14 On the same date, the group
likewise notified the NCMB of its intention to hold a strike vote on May 27,
1994. CDHSac

On May 27, 1994, the Colomeda group notified the NCMB of the results of
their strike vote, which favored the holding of a strike. 15 In reply, NCMB issued a
letter again advising them that by virtue of the PAL v. Drilon ruling, their notice of
strike is deemed not to have been filed, consequently invalidating any
subsequent strike for lack of compliance with the notice requirement. 16 Despite
this and the pendency of the preventive mediation proceedings, on June 4, 1994,
IBM went on strike. The strike paralyzed the operations of petitioner, causing it
losses allegedly worth P29.98 million in daily lost production. 17
Two days after the declaration of strike, or on June 6, 1994, petitioner filed
with public respondent NLRC an amended Petition for Injunction with Prayer for
the Issuance of Temporary Restraining Order, Free Ingress and Egress Order
and Deputization Order. 18 After due hearing and ocular inspection, the NLRC on
June 13, 1994 resolved to issue a temporary restraining order (TRO) directing
free ingress to and egress from petitioner's plants, without prejudice to the
union's right to peaceful picketing and continuous hearings on the injunction
case. 19
To minimize further damage to itself, petitioner on June 16, 1994, entered
into a Memorandum of Agreement (MOA) with the respondent-union, calling for a
lifting of the picket lines and resumption of work in exchange of "good faith talks"
between the management and the labor management committees. The MOA,
signed in the presence of Department of Labor and Employment (DOLE) officials,
expressly stated that cases filed in relation to their dispute will continue and will
not be affected in any manner whatsoever by the agreement. 20 The picket lines
ended and work was then resumed.
Respondent thereafter moved to reconsider the issuance of the TRO, and
sought to dismiss the injunction case in view of the cessation of its picketing
activities as a result of the signed MOA. It argued that the case had become
moot and academic there being no more prohibited activities to restrain, be they
actual or threatened. 21 Petitioner, however, opposed and submitted copies of
flyers being circulated by IBM, as proof of the union's alleged threat to revive the
strike. 22 The NLRC did not rule on the opposition to the TRO and allowed it to
lapse.
On November 29, 1994, the NLRC issued the challenged decision,
denying the petition for injunction for lack of factual basis. It found that the
circumstances at the time did not constitute or no longer constituted an actual or
threatened commission of unlawful acts. 23 It likewise denied petitioner's motion
for reconsideration in its resolution dated February 1, 1995. 24
Hence, this petition.
Aggrieved by public respondent's denial of a permanent injunction,
petitioner contends that:
A.
THE NLRC GRAVELY ABUSED ITS DISCRETION WHEN IT FAILED
TO ENFORCE, BY INJUNCTION, THE PARTIES' RECIPROCAL
OBLIGATIONS TO SUBMIT TO ARBITRATION AND NOT TO STRIKE.
B.
THE NLRC GRAVELY ABUSED ITS DISCRETION IN WITHHOLDING
INJUNCTION WHICH IS THE ONLY IMMEDIATE AND EFFECTIVE
SUBSTITUTE FOR THE DISASTROUS ECONOMIC WARFARE THAT
ARBITRATION IS DESIGNED TO AVOID.
C.
 THE NLRC GRAVELY ABUSED ITS DISCRETION IN ALLOWING THE
TRO TO LAPSE WITHOUT RESOLVING THE PRAYER FOR
INJUNCTION, DENYING INJUNCTION WITHOUT EXPRESSING THE
FACTS AND THE LAW ON WHICH IT IS BASED AND ISSUING ITS
DENIAL FIVE MONTHS AFTER THE LAPSE OF THE TRO. 25
We find for the petitioner.
Article 254 of the Labor Code provides that no temporary or permanent
injunction or restraining order in any case involving or growing out of labor
disputes shall be issued by any court or other entity except as otherwise provided
in Articles 218 and 264 of the Labor Code. Under the first exception, Article 218
(e) of the Labor Code expressly confers upon the NLRC the power to "enjoin or
restrain actual and threatened commission of any or all prohibited or unlawful
acts, or to require the performance of a particular act in any labor dispute which,
if not restrained or performed forthwith, may cause grave or irreparable damage
to any party or render ineffectual any decision in favor of such party . . . ." The
second exception, on the other hand, is when the labor organization or the
employer engages in any of the "prohibited activities" enumerated in Article 264.
Pursuant to Article 218 (e), the coercive measure of injunction may also be
used to restrain an actual or threatened unlawful strike. In the case of San Miguel
Corporation v. NLRC 26 where the same issue of NLRC's duty to enjoin an
unlawful strike was raised, we ruled that the NLRC committed grave abuse of
discretion when it denied the petition for injunction to restrain the union from
declaring a strike based on non-strikeable grounds. Further, in IBM
v. NLRC, 27 we held that it is the "legal duty and obligation" of the NLRC to enjoin
a partial strike staged in violation of the law. Failure promptly to issue an
injunction by the public respondent was likewise held therein to be an abuse of
discretion.
In the case at bar, petitioner sought a permanent injunction to enjoin the
respondent's strike. A strike is considered as the most effective weapon in
protecting the rights of the employees to improve the terms and conditions of
their employment. However, to be valid, a strike must be pursued within legal
bounds. 28 One of the procedural requisites thatArticle 263 of the Labor Code
and its Implementing Rules prescribe is the filing of a valid notice of strike with
the NCMB. Imposed for the purpose of encouraging the voluntary settlement of
disputes, 29 this requirement has been held to be mandatory, the lack of which
shall render a strike illegal. 30
In the present case, NCMB converted IBM's notices into preventive
mediation as it found that the real issues raised are non-strikeable. Such order is
in pursuance of the NCMB's duty to exert "all efforts at mediation and conciliation
to enable the parties to settle the dispute amicably," 31 and in line with the state
policy of favoring voluntary modes of settling labor disputes. 32 In accordance
with the Implementing Rules of the Labor Code, the said conversion has the
effect of dismissing the notices of strike filed by respondent. 33 A case in point
is PAL v. Drilon, 34 where we declared a strike illegal for lack of a valid notice of
strike, in view of the NCMB's conversion of the notice therein into a preventive
mediation case. We ruled, thus:
The NCMB had declared the notice of strike as "appropriate for
preventive mediation." The effect of that declaration (which PALEA did
not ask to be reconsidered or set aside) was to drop the case from the
docket of notice of strikes, as provided in Rule 41 of the NCMB Rules, as
if there was no notice of strike. During the pendency of preventive
mediation proceedings no strike could be legally declared . . . The strike
which the union mounted, while preventive mediation proceedings were
ongoing, was aptly described by the petitioner as "an ambush."(Italics
supplied)
Clearly, therefore, applying the aforecited ruling to the case at bar, when
the NCMB ordered the preventive mediation on May 2, 1994, respondent had
thereupon lost the notices of strike it had filed. Subsequently, however, it still
defiantly proceeded with the strike while mediation was ongoing, and
notwithstanding the letter-advisories of NCMB warning it of its lack of notice of
strike. In the case of NUWHRAIN v. NLRC, 35 where the petitioner-union therein
similarly defied a prohibition by the NCMB, we said:
Petitioners should have complied with the prohibition to strike
ordered by the NCMB when the latter dismissed the notices of strike
after finding that the alleged acts of discrimination of the hotel were not
ULP, hence not "strikeable." The refusal of the petitioners to heed said
proscription of the NCMB is reflective of bad faith.
Such disregard of the mediation proceedings was a blatant violation of the
Implementing Rules, which explicitly oblige the parties to bargain
collectively in good faith and prohibit them from impeding or disrupting the
proceedings. 36
The NCMB having no coercive powers of injunction, petitioner sought
recourse from the public respondent. The NLRC issued a TRO only for free
ingress to and egress from petitioner's plants, but did not enjoin the unlawful
strike itself. It ignored the fatal lack of notice of strike, and five months after came
out with a decision summarily rejecting petitioner's cited jurisprudence in this
wise:
Complainant's scholarly and impressive arguments, formidably
supported by a long line of jurisprudence cannot however be
appropriately considered in the favorable resolution of the instant case
for the complainant. The cited jurisprudence do not squarely cover and
apply in this case, as they are not similarly situated and the remedy
sought for were different. 37
 Unfortunately, the NLRC decision stated no reason to substantiate the above
conclusion.
Public respondent, in its decision, moreover ruled that there was a lack of
factual basis in issuing the injunction. Contrary to the NLRC's finding, we find that
at the time the injunction was being sought, there existed a threat to revive the
unlawful strike as evidenced by the flyers then being circulated by the IBM-NCR
Council which led the union. These flyers categorically declared: "Ipaalala n'yo sa
management na hindi iniaatras ang ating Notice of Strike (NOS) at anumang
oras ay pwede nating muling itirik ang picket line." 38 These flyers were not
denied by respondent, and were dated June 19, 1994, just a day after the union's
manifestation with the NLRC that there existed no threat of commission of
prohibited activities.
Moreover, it bears stressing that Article 264(a) of the Labor
Code 39 explicitly states that a declaration of strike without first having filed the
required notice is a prohibited activity, which may be prevented through an
injunction in accordance with Article 254. Clearly, public respondent should have
granted the injunctive relief to prevent the grave damage brought about by the
unlawful strike.
Also noteworthy is public respondent's disregard of petitioner's argument
pointing out the union's failure to observe the CBA provisions on grievance and
arbitration. In the case of San Miguel Corp. v. NLRC 40 we ruled that the union
therein violated the mandatory provisions of the CBA when it filed a notice of
strike without availing of the remedies prescribed therein. Thus we held:
. . . For failing to exhaust all steps in the grievance machinery and
arbitration proceedings provided in the Collective Bargaining Agreement,
the notice of strike should have been dismissed by the NLRC and private
respondent union ordered to proceed with the grievance and arbitration
proceedings. In the case of Liberal Labor Union vs. Phil. Can Co., the
court declared as illegal the strike staged by the union for not complying
with the grievance procedure provided in the collective bargaining
agreement . . . (Citations omitted)
As in the abovecited case, petitioner herein evinced its willingness to
negotiate with the union by seeking for an order from the NLRC to compel
observance of the grievance and arbitration proceedings. Respondent
however resorted to force without exhausting all available means within its
reach. Such infringement of the aforecited CBA provisions constitutes further
justification for the issuance of an injunction against the strike. As we said
long ago: "Strikes held in violation of the terms contained in a collective
bargaining agreement are illegal especially when they provide for conclusive
arbitration clauses. These agreements must be strictly adhered to and
respected if their ends have to be achieved." 41
 As to petitioner's allegation of violation of the no-strike provision in the
CBA, jurisprudence has enunciated that such clauses only bar strikes which are
economic in nature, but not strikes grounded on unfair labor practices. 42 The
notices filed in the case at bar alleged unfair labor practices, the initial
determination of which would entail fact-finding that is best left for the labor
arbiters. Nevertheless, our finding herein of the invalidity of the notices of strike
dispenses with the need to discuss this issue.
We cannot sanction the respondent-union's brazen disregard of legal
requirements imposed purposely to carry out the state policy of promoting
voluntary modes of settling disputes. The state's commitment to enforce mutual
compliance therewith to foster industrial peace is affirmed by no less than our
Constitution. 43 Trade unionism and strikes are legitimate weapons of labor
granted by our statutes. But misuse of these instruments can be the subject of
judicial intervention to forestall grave injury to a business enterprise. 44
WHEREFORE, the instant petition is hereby GRANTED. The decision and
resolution of the NLRC in Injunction Case No. 00468-94 are REVERSED and
SET ASIDE. Petitioner and private respondent are hereby directed to submit the
issues raised in the dismissed notices of strike to grievance procedure and
proceed with arbitration proceedings as prescribed in their CBA, if necessary. No
pronouncement as to costs. ACDIcS

SO ORDERED.
(San Miguel Corp. v. National Labor Relations Commission, G.R. No. 119293,
|||

[June 10, 2003], 451 PHIL 514-528)

[G.R. No. L-37687. March 15, 1982.]

PEOPLE'S INDUSTRIAL AND COMMERCIAL EMPLOYEES

AND WORKERS ORGANIZATION (FFW), ERNESTO
PAGAYATAN, ANTONIO ERIÑO, RODRIGO BOADO AND LINO
FRANCISCO, petitioners, vs. PEOPLE'S INDUSTRIAL AND
COMMERCIAL CORPORATION, FEDERATION OF TENANTS
AND LABORERS ORGANIZATION, and THE COURT OF
INDUSTRIAL RELATIONS, respondents.

Romeo P. Torres for petitioners.

Jose M. Omega, David Rigor Advincula, Jr. and Ceferino Padua for
respondents.
 SYNOPSIS

Individual Petitioners, employees of respondent People's Industrial and

Commercial Corporation (PINCOCO) and members of the Federation of Tenants
and Laborers Organization, FTLO, with Pagayatan as President, disaffiliated
themselves together with 51 employees from the mother federation and certified
that they formed a new union called People's Industrial and Commercial
Employees and Workers Organization (PICEWO) which they have affiliated with
the Federation of Free Workers. Then, Pagayatan as Chapter President of FTLO
notified PINCOCO in writing of the union's desire to terminate their working
agreement and as President of PICEWO sent PINCOCO a set of proposals for a
collective bargaining agreement to which no reply was made. Individual
petitioners were expelled by FTLO for disloyalty and were dismissed by
PINCOCO from their employment. On the belief that respondent company
refused to bargain collectively with PICEWO, the latter struck. The next day a
new collective bargaining agreement was signed by respondent company and
the FTLO. Three separate cases filed by both FTLO against individual petitioners
and by PICEWO against PINCOCO and FTLO for unfair labor practices were
dismissed by respondent Court of Industrial Relations on the findings of its
Hearing Examiner that no unfair labor practice was committed.
On review by certiorari, the Supreme Court held that petitioners do not merit
dismissal as the act of disaffiliation is not disloyalty to the union. Neither is the
strike illegal where the union believes that respondent company committed unfair
labor practices and the circumstances warranted such belief, although later such
allegations were proven to be untrue.
Decision appealed from, set aside.

SYLLABUS

1. REMEDIAL LAW; PLEADINGS AND PRACTICE; PERIOD FOR FILING;

TECHNICALITIES OF PROCEDURE SHOULD BE DISREGARDED TO
PROTECT SUBSTANTIAL RIGHTS. — Where the last day for filing the motion
for reconsideration was April 9, 1973 which was a holiday (BATAAN DAY), and
the last day for filing the arguments in support of the motion for reconsideration,
ten days after, was April 19, 1973, also a holiday (MAUNDY THURSDAY) and
petitioners have filed their pleadings on the next respective business days, that is
April 10, 1973 for the motion for reconsideration and April 23, for the arguments
in support thereof (April 20 to 22 not being business days), the respondent court
erred in holding that the Motion for Reconsiderations and the Memorandum in
support of the Motion for Reconsideration were filed out of time. It is the policy of
the law to disregard technicalities in procedure so as not to deprive the litigant's
pursuit of his substantial rights under the Rules.
2. CIVIL LAW; EFFECT AND APPLICATION OF LAWS; COMPUTATION OF
PERIOD. — Under Article 13, last paragraph. of the Civil Code in computing the
period. the first day shall be excluded, and the last day included.
3. LABOR AND SOCIAL LEGISLATION; LABOR CODE; UNFAIR LABOR
PRACTICE; DISAFFILIATION FROM THE MOTHER FEDERATION; NOT
DISLOYALTY IN THE ABSENCE OF PROHIBITION IN THE UNION'S
CONSTITUTION. BY-LAWS AND CHARTER; CASE AT BAR.— The right of the
local members to withdraw from the federation and to form a new local depends
upon the provisions of the union's constitution, by-laws and charter. In the
absence of enforceable provisions in the federation's constitution preventing
disaffiliation of a local union, a local may sever its relationship with its parent. In
the case at bar, there is nothing shown in the records nor is it claimed by
respondent federation that the local union was expressly forbidden to disaffiliate
from the federation. Fifty-one out of sixty employees is equivalent to eighty five
percent (85%) of the total working Force. This is not a case where one or two
members of the old union decided to organize another union in order to topple
down the former, but it is a case where majority of the union members decided to
reorganize the union and to disaffiliate from the mother Federation.
4. ID.; ID.; ID.; ID.; ID.; FORMATION OF NEW UNION IS THE VERY ESSENCE
OF SELF-ORGANIZATION. — The federation and the union are two different
entities and it was the federation which actively initiated the dismissal of the
individual petitioners. A local union does not owe its existence to the federation to
which it is affiliated. It is a separate and distinct voluntary association owing its
creation and continued existence to the will of its members. The very essence of
self-organization is for the workers to form a group for the effective enhancement
and protection of their common interests.
5. ID.; ID.; ID.; STRIKE; WHEN IT MAY BE CONSIDERED LEGAL.— A strike
may be considered legal when the union believed that the respondent company
committed unfair labor acts and the circumstances warranted such belief in good
faith although subsequently such allegation of unfair labor practices are found out
as not true.
6. ID.; ID.; ID.; ID.; ID.; RIGHTS OF THE STRIKING MEMBERS, UNDER THE
FERRER RULING AND UNDER THE PEPITO RULING; CASE AT BAR. —
Where the strike of the union was in response to what it was warranted in
believing in good faith to be unfair labor practice on the part of the management,
said strike following the Ferrer ruling (Ferrer, et al. vs. CIR, et al., L-242678, May
31,1966, 17 SCRA 532) did not result in the termination of the striking members'
status as employees and therefore, they are still entitled to reinstatement without
backwages. The Ferrer ruling was also upheld in Shell Oil Workers Union vs.
Shell Company of the Phil. Ltd. (L-28607, May 31, 1971, 39 SCRA 276). In the
case of Pepito vs. Secretary of Labor, L-49418, Feb. 29, 1980, the petitioner
therein was separated for having been implicated in a pilferage case by a co-
employee but was later absolved from a charge, the Supreme Court thru Chief
Justice Fernando ruled that the cause for His dismissal was proved non-existent
or false and thus ordered his reinstatement with three years backwages, without
deduction and qualification. In the case at bar, following the Pepito ruling the
Supreme Court held that petitioners are entitled not only to reinstatement but
also to three years backwages without deduction and qualification. This is
justified and proper since the strike was proved to be not illegal but was induced
in the honest belief that management had committed unfair labor practices and,
therefore, the cause of their dismissal from employment was non-existent.
7. CONSTITUTIONAL LAW; PROTECTION OF LABOR PROVISIONS;
ASSURES RIGHTS OF WORKERS TO SELF-ORGANIZATION. COLLECTIVE
BARGAINING AND SECURITY OF TENURE; CIRCUMSTANCES IN CASE AT
BAR DESERVING WORKERS PROTECTION. — It has been twelve years since
petitioners were dismissed from their employment and in their destitute and
deplorable condition, to them the benign provisions of the New Constitution for
the protection of labor, assuring the rights of workers to self-organizaton,
collective bargaining and security of tenure would be useless and meaningless.
Labor, being the weaker in economic power and resources than capital, deserve
protection that is actually substantial and material.

DECISION

GUERRERO, J : p

Petition for review of the decision and en banc resolution of the Court of
Industrial Relations dated April 2, 1973 and October 3, 1973, respectively,
promulgated in three (3) consolidated cases. 1
The decision penned by Associate Judge Alberto S. Veloso adopting in full the
report of CIR Hearing Examiner Atty. Francisco de los Reyes made the following
dispositive portion, thus —
"After a careful review, scrutiny and evaluation of the records of these
cases, as well as of every piece of evidence adduced by the parties, pro
and con, this court finds the findings of facts and conclusions of law
contained in the aforequoted Report to be amply substantiated, and,
therefore, adopts the same as its own.
 "WHEREFORE, in view of all the foregoing, above-entitled cases should
therefore be, as they are hereby ordered DISMISSED.
SO ORDERED."
This petition limits itself to the controversy in Case No. 4498-ULP filed by
People's Industrial and Commercial Employees and Workers Organization
against People's Industrial and Commercial Corporation and the Federation of
Tenants and Laborers Organization. LexLib

On the basis of the Examiner's Report, the following facts appear: On April 30,
1964, the Federation of Tenants and Laborers Organization, Rizal Chapter,
FTLO for short, entered into a collective bargaining agreement with respondent
People's Industrial and Commercial Corporation, hereafter referred to as
PINCOCO, (Exhibits "2" and "G"). At the time the agreement was consummated,
herein individual petitioners, Ernesto Pagayatan, Antonio Eriño, Rodrigo Boado
and Lino Francisco, who were also the individual complainants in Case No.
4498-ULP, together with those mentioned in Annex "A" of the complaint (List of
some forty-five [45] other employees), were employees of PINCOCO and
members of FTLO. The relevant portions of the working agreement stipulate:
xxx xxx xxx
"Art. II — Union Security Maintenance Shop. Those who are members in
good standing of the Union before the signing of this working agreement,
shall continue to be union members in good standing as a prerequisite
for continued employment in the company.
xxx xxx xxx
Any employee covered by this agreement who during its term, should
resign from the union or shall be expelled therefrom according to its
normal procedures for any of the causes hereafter enumerated, shall
upon written notice by the union directorate, be discharged from
employment, provided that the causes for expulsion from the Union be
any of the following:

1. Working in the interest of any labor organization other than the Union
which claims or exercises jurisdiction similar to that claimed or exercised
by the Union;
2. Refusal to pay or non-payment of Union dues and Assessment;
3. Disloyalty to the Union;
4. Separation from the Union for cause.
xxx xxx xxx
 "Art. VIII. No Strike, No Lockout. For the duration of the Agreement, the
COMPANY shall not lockout its employees, nor shall the UNION or any
employee stage any strike, picket or other concerted activity other than
in protest of unfair labor practice, and the court decision in the case that
may be filed in this connection shall determine the propriety of such
concerted activity under the Agreement. Violation of this paragraph shall
be treated as subject to the same sanctions as a violation of the duty to
bargain collectively.
A stoppage of work or cessation of operation due to poor sales, lack of
raw material, or any other business reason, or toforce majeure, shall not
be deemed a lockout for the purpose of the preceding paragraph. In any
case that the COMPANY should stop operations due to any of the
foregoing reasons, adequate notice shall be given to the UNION
whenever possible.
xxx xxx xxx
"Art. XI. Duration of the Agreement. This Agreement shall take effect this
___ day of April, 1964 and shall only be in effect for a period of one (1)
year thereafter. Unless written notice of a desire to terminate or modify
the same is given by either party to the other at least thirty (30) days
before its expiration, this agreement shall be deemed to be renewed for
another year."
xxx xxx xxx
On October 18, 1964, it appears that with the knowledge of PINCOCO, an
election of union officers of the Rizal Chapter of FTLO was conducted by virtue of
a resolution (Exhibit "2-FFW," t.s.n., pp. 24-31, October 10, 1969) and that
individual petitioners were elected as the new officers with Ernesto Pagayatan as
chapter president (Exhibits "4-FFW" and "5-FFW"). On January 10, 1965,
individual petitioners together with fifty-one (51) other employees executed a
Certification (Exhibit "3-FFW") stating that they are members of the Federation of
Tenants and Laborers Organization, but as of the above date, they have
changed the name of their union to People's Industrial and Commercial
Employees and Workers Organization (PICEWO) and have affiliated this new
union with the Federation of Free Workers. Ernesto Pagayatan was again made
the president of the new union (PICEWO) together with the set of officers elected
with him in the last election retaining their respective positions. Further, in the
same certification, the union counsel of FTLO, Atty. David Advincula, was
disauthorized to represent the signatories. The certification contains no specific
reason or cause for the change of union name. On February 10, 1965, the new
union was granted a certificate of registration by the Department of Labor (Exhibit
"1-FFW").
On March 23, 1965, Ernesto Pagayatan, assuming the capacity of chapter
president of FTLO and not as a president of PICEWO, notified in writing
respondent PINCOCO of their desire to terminate the working agreement. Later,
a set of collective bargaining proposals was sent in the name of PICEWO
(Exhibits "E," "10" and "11"). PINCOCO replied this wise:
xxx xxx xxx
"That in view of the study effected by the management as to its stand
with regard to the said proposals and further submission of the same to
our legal counsel for consultation and advice and considering that April
15, 1965 is a legal holiday we cannot serve you, our formal reply within
the period specified by existing statute.
"However, we assure you of our formal reply to your proposal on April
14, 1965 and that management will endeavor to avail of the remedies
within the financial capacity of the company and other factors to be
considered to meet the terms of your proposal."
On April 13, 1965, FTLO passed a resolution expelling petitioners Ernesto
Pagayatan, Antonio Eriño, Rodrigo Boado and Lino Francisco from the
Federation of Tenants and Laborers Organization (FTLO) on grounds of
disloyalty and working for the interest of another labor federation (Exhibit "F"). On
April 22, 1965, Ernesto Pagayatan, this time as president of PICEWO filed a
notice of strike, alleging as cause thereof respondent employer's refusal to
bargain. (Exhibit "9-H"). On April 29, 1965, prompted by the demand of the
majority of the FTLO directorate to enforce the maintenance of membership shop
of the working agreement, respondent PINCOCO dismissed Ernesto Pagayatan
and his companions from employment (Exhibits "12-FFW," "12-A-FFW" to 12-C-
FFW"). On May 1, 1965, the FTLO and respondent PINCOCO executed a
collective bargaining agreement for a period of three (3) years (Exhibits "A-CO"
and "D").
Meanwhile, on April 30, 1965, PICEWO, led by individual petitioners struck.
Thereafter, at the behest of the FTLO, respondent PINCOCO posted a notice for
the strikers to return to work within a period of five (5) or ten (10) days or else
they shall be considered to have abandoned their work. None of the strikers
returned and picketing went on for a period of six (6) months. Later, PINCOCO
again posted a notice that it had decided to resume operation on March 9, 1966,
and between March 7 and 8 of the same year, all employees were advised to
signify their ability to work at which time they will be required to submit police
clearances and to medical and physical examination by the company physician,
otherwise their failure to return within the period shall be considered as
abandonment of work. On March 31, 1966 petitioner-union, through its president,
signified the intention to return to work beginning April 4, 1966. None of the
strikers, however, were allowed to work.
From the preceding developments, three separate cases were filed with the
Court of Industrial Relations. In Case No. 4428-ULP, FTLO indicted herein
individual petitioners for unfair labor practice in staging an illegal strike after they
were already dismissed from the company. In Case No. 167-INJ, FTLO sought
for the issuance of a permanent injunction to stop the alleged illegal strike. In
Case No. 4498-ULP, PICEWO sued PINCOCO and FTLO for unfair labor
practice, alleging that by illegally dismissing petitioners, the company
discriminated against them in regard to hire, tenure and/or other conditions of
employment by unlawfully acceding and effecting the request of FTLO without
proper investigation thereof, with no just reason but to encourage membership in
the FTLO; and that respondent federation, in recommending and insisting on the
dismissal of individual petitioners, had interfered in their right to self-organization
(Annex "C," p. 39, Rollo).
After the reception of evidence, the Hearing Examiner designated by the Court of
Industrial Relations reported that the petitioners were, beyond doubt, members of
the FTLO when the Working Agreement of April 30, 1964 took effect and that the
working agreement required in Article II thereof maintenance of membership in
the federation as condition for continued employment in the company. Since the
specific causes for expulsion from membership have been enumerated,
particularly that of working for the interest of another organization and disloyalty
to the union, the Hearing Examiner concluded that petitioners' conduct is within
the said causes expressed in the agreement. The Report also established that
FTLO is the sole and exclusive bargaining representative of the employees which
entered into a bona fide agreement, putting a limitation of petitioners' right to
leave the union and join another. The Examiner found no unfair labor practice
committed by either the FTLO or PINCOCO, and that the strike staged by
petitioners was not on account of any unfair labor practice, but, rather, done to
force recognition.
Based on the above findings, respondent court dismissed the three cases. On
April 10, 1973, petitioners filed their motion for reconsideration; same was denied
in the en banc resolution of October 3, 1973. Petitioners now raise the following
assignment of errors:
a) The respondent court erred in holding that the Motion for Reconsideration and
the Memorandum in support of the Motion for Reconsideration were filed out of
time;
b) The respondent court erred in holding that the strike declared by herein
petitioners was intended only to force recognition;.
c) The respondent court erred in not declaring both respondent Corporation and
respondent Federation guilty of committing unfair labor practice;
d) The respondent court erred in not declaring as illegal the dismissal from
employment of individual petitioners; and
e) Respondent court erred in not ordering the return to work of the striking
members of petitioner Union with backwages and other fringe benefits from April
30, 1965 until their actual reporting for work.
The last day for filing the motion for reconsideration was April 9, 1973 which was
a holiday (BATAAN DAY), and the last day for filing the arguments in support of
the motion for reconsideration, ten days after, was April 19, 1973, also a holiday
(MAUNDY THURSDAY). Since petitioners have filed their pleadings on the next
respective business days, that is, April 10, 1973, for the motion for
reconsideration and April 23 for the arguments in support thereof (April 20 to 22
not being business days), the pleadings were, therefore, filed on time. On this
procedural aspect, the resolution of October 3, 1973 has erred. It is the policy of
the law to disregard technicalities in procedure so as not to deprive the litigant's
pursuit of his substantial rights under the Rules.
Under Article 13, last paragraph, of the Civil Code, in computing the period, the
first day shall be excluded, and the last day included. And under Rule 28 of the
Rules of Court, Section 1, time is computed thus —

"Sec 1. How to compute time. — In computing any period of time

prescribed or allowed by these rules, by order of court, or by any
applicable statute, the day of the act, event, or default after the
designated period of time begins to run is not to be included. The last
day of the period so computed is to be included, unless it is a Sunday or
a legal holiday, in which event the time shall run until the end of the next
day which is neither a Sunday nor a holiday."
Under the second assignment of error, the question to be resolved is whether or
not the petitioners' act of disaffiliating themselves from the mother federation
constitutes an act of disloyalty to the union which would warrant their expulsion
and consequently their dismissal from the company in pursuance to the union
security clause embodied in the CBA.
Petitioners contend that no disloyalty is involved since what they did on January
10, 1965 was merely to change, as they did change, the name of Rizal Chapter
of the Federation of Tenants and Laborers Organization (FTLO) to People's
Industrial and Commercial Employees and Workers Organization (PICEWO). LexLib

While We are not convinced with the petitioners' argument that the only act that
they have done was to change the name of their union for they have registered
the new union and affiliated it with the Federation of Free Workers, We rule that
individual petitioners do not merit the dismissals meted by the company.
In Liberty Cotton Mills Workers Union vs. Liberty Cotton Mills, 2 We held that the
validity of the dismissals pursuant to the security clause of CBA hinges on the
validity of the disaffiliation of the local union from the federation. It was further
held in this case that PAFLU (the federation) had the status of an agent while the
local union remained the basic unit of association free to serve the common
interest of all its members including the freedom to disaffiliate when the
circumstances warrant such an act. The Supreme Court, speaking thru Justice
Esguerra, said:
"All these questions boil down to the single issue of whether or not the
dismissal of the complaining employees, petitioners herein, was justified
or not. The resolution of this question hinges on a precise and careful
analysis of the Collective Bargaining Agreements. (Exhs. "H" and "I"). In
these contracts it appears that PAFLU has been recognized as the sole
bargaining agent for all the employees of the Company other than its
supervisors and security guards. Moreover it likewise appears that
"PAFLU, represented in this Act by its National Treasurer, and duly
authorized representative, .. (was) acting for and in behalf of its affiliate,
the Liberty Cotton Mills Workers Union and the employees of the
Company, etc." In other words, the PAFLU, acting for and in behalf of its
affiliate, had the status of an agent while the local union remained the
basic unit of the association free to serve the common interest of all its
members including the freedom to disaffiliate when the circumstances
warrant. This is clearly provided in its Constitution and By-laws,
specifically Article X on Union Affiliation, supra. At this point, relevant is
the ruling in an American case. (Harker et al. vs. Mckissock, et al., 81A
2d 480, 482).
"The locals are separate and distinct units primarily designed to secure
and maintain an equality of bargaining power between the employer and
their employee-members in the economic struggle for the fruits of the
joint productive effort of labor and capital; and the association of the
locals into the national union (as PAFLU) was in furtherance of the same
end. These associations are consensual entities capable of entering into
such legal relations with their members. The essential purpose was the
affiliation of the local unions into a common enterprise to increase by
collective action the common bargaining power in respect of the terms
and conditions of labor. Yet the locals remained the basic units of
association, free to serve their own and the common interest of all,
subject to the restraints imposed by the Constitution and By-laws of the
Association, and free also to renounce the affiliation for mutual welfare
upon the terms laid down in the agreement which brought it into
existence."
The right of the local members to withdraw from the federation and to form a new
local depends upon the provisions of the union's constitution, by laws and
charter. In the absence of enforceable provisions in the federation's constitution
preventing disaffiliation of a local union, a local may sever its relationship with its
parent.
There is nothing shown in the records nor is it claimed by respondent federation
that the local union was expressly forbidden to disaffiliate from the federation.
Except for the union security clause, the federation claims no other ground in
expelling four of the fifty-one who signed the certification.
Fifty-one out of sixty employees is equivalent to eighty five percent (85%) of the
total working force. This is not a case where one or two members of the old union
decided to organize another union in order to topple down the former, but it is a
case where majority of the union members decided to reorganize the union and
to disaffiliate from the mother federation.
There is no merit to the contention of the respondent federation that the act of
disaffiliation is disloyalty to the union. The federation and the union are two
different entities and it was the federation which actively initiated the dismissal of
the individual petitioners. A local union does not owe its existence to the
federation to which it is affiliated. It is a separate and distinct voluntary
association owing its creation and continued existence to the will of its members.
The very essence of self-organization is for the workers to form a group for the
effective enhancement and protection of their common interests.
The third, fourth and fifth assignment of errors maybe resolved on the same
issue which is the legality of the strike and the consequences thereof.
Petitioners allege that the strike which was started on April 30, 1965 was staged
because of the unfair labor practice of the respondent company in refusing to
bargain collectively with PICEWO and in dismissing individual petitioners. The
Hearing Officer in his Report which was adopted in full by the Court of Industrial
Relations settled the legality of the strike in the following manner:
xxx xxx xxx
"While the reply of respondent PINCOCO to the proposal of the new
union evokes ambiguity, the same may not be treated as a refusal to
bargain. At the time the letter proposal was sent, the presumed
bargaining agent was the FTLO. No showing had been made that the
PICEWO, upon its organization was and should have been accorded the
status of a majority bargaining representative. The letter reply of
PINCOCO, although it seem to cast doubt as to its motivation, should
not be held and taken against it as a positive design to discriminate in
the absence of any additional or corroborative showing that the new
union actually represented the majority of the employees in the unit and
that this fact was known to the management.
The strike therefore of the PICEWO was not on account of any unfair
labor practice acts committed by the respondent PINCOCO. It seem to
have been more of a strike to force recognition."
xxx xxx xxx
We do not agree with the finding of the Hearing Officer that the strike was staged
to force recognition. The chain of events which preceded the strike belie this
conclusion. On April 5 , 1965, Ernesto Pagayatan, the president of PICEWO sent
to the management a set of proposals for a collective bargaining agreement. The
management on April 13, 1965 replied that the formal reply to the proposals
cannot be made within the reglementary period because they will submit the said
proposals to their legal counsel for further study and instead their reply would be
made on April 19, 1965. No reply was made on that date. On April 29, 1965,
individual petitioners were dismissed. A strike was staged the next day. One day
after the petitioners struck, a new collective bargaining agreement was signed by
the respondent company and the FTLO.
The respondent company knew that a new union was formed composed of about
85% of the total number of its employees. It was furnished a copy of the
certification that the majority of the FTLO members are forming a new union
called PICEWO. The set of bargaining proposals were in the name of the new
union. While a company cannot be forced to sit down and bargain collectively
with the new union since it had no notice of the union's official capacity to act as
the bargaining agent, the respondent company cannot deny that it had factual
knowledge of the existence of a majority union. It could have asked for further
proof that the new union was indeed the certified bargaining agent. It did not.
Instead, it dismissed individual petitioners and signed a new CBA the day after
the expiration of the old CBA, on the pretext that FTLO was presumed to be the
certified bargaining agent. Such pretext does not seem justified nor reasonable in
the face of the established fact that a new union enjoyed a majority status within
the company.
On the belief that the respondent company refused to bargain collectively with
PICEWO, individual petitioners together with the other members staged a strike.
We have in several cases ruled that a strike may be considered legal when the
Union believed that the respondent company committed unfair labor acts and the
circumstances warranted such belief in good faith although subsequently such
allegation of unfair labor practice are found out as not true.
Thus, in Norton and Harrison Co. and Jackbilt Blocks Company Labor Union
(NLU) vs. Norton and Harrison, et al., 3 We held that "the act of the company in
dismissing Arcaina, done without the required fair hearing, and, therefore, not
tenable even under strict legal ground, induced the union and its members to
believe that said company was guilty of unfair labor practice although viewed
now in retrospect said act would fall short of unfair labor practice. Since the strike
of the union was in response to what it was warranted in believing in good faith to
be unfair labor practice on the part of the management, said strike following
the Ferrer ruling 4 did not result in the termination of the striking members' status
as employees and therefore, they are still entitled to reinstatement without
backwages."

The Ferrer ruling was also upheld in Shell Oil Workers Union vs. Shell Company
of the Phil. Ltd. 5 where We stated that "(i)t is not even required that there be in
fact an unfair labor practice committed by the employer. It suffices, if such a
belief in good faith is entertained by labor as the inducing factor for staging a
strike. So it was clearly stated by the present Chief Justice while still an
Associate Justice of this Court: 'As a consequence, we hold that the strike in
question had been called to offset what petitioners were warranted in believing in
good faith to be unfair labor practices on the part of Management, that petitioners
were not bound, therefore, to wait for the expiration of thirty (30) days from notice
of strike before staging the same, that said strike was not, accordingly, illegal and
that the strikers had not thereby lost their status as employees of respondents
herein.'"
The Ferrer ruling was promulgated in 1966, that in the Shell Oil case in 1971. In
1980, there was the case of Pepito vs. Secretary of Labor, L-49418, Feb. 29,
1980, where petitioner therein was separated for having been implicated in a
pilferage case by a co-employee but was later absolved from the charge. The
Supreme Court thru Chief Justice Fernando ruled that the cause for his dismissal
was proved non-existent or false and thus ordered his reinstatement with three
years backwages, without deduction and qualification.
We adopt the Pepito ruling and We hold that the petitioners in the case at bar are
entitled not only to reinstatement but also to three years backwages without
deduction and qualification. This is justified and proper since the strike was
proved and We held the same to be not illegal but was induced in the honest
belief that management had committed unfair labor practices and, therefore, the
cause of their dismissal from employment was nonexistent. It is clear that
management gave cause or reason to induce the staging of the strike by
improperly refusing to recognize the new union formed by petitioners. It has been
twelve (12) years since petitioners were dismissed from their employment and in
their destitute and deplorable condition, to them the benign provisions of the New
Constitution for the protection of labor, assuring the rights of workers to self-
organization, collective bargaining and security of tenure would be useless and
meaningless. Labor, being the weaker in economic power and resources than
capital, deserve protection that is actually substantial and material.
cdrep

WHEREFORE, IN VIEW OF THE FOREGOING, the decision under review is

hereby SET ASIDE. The respondent company is hereby ordered to reinstate
individual petitioners and other striking members within thirty (30) days from
notice of this decision, with backwages equivalent to three (3) years at the rates
actually received by them before their dismissal without deduction and
qualification.
In view of the length of time that this dispute has been pending, this decision
shall be immediately executory upon promulgation and notice to the parties.
Without pronouncement as to costs.
SO ORDERED.
(People's Industrial and Commercial Employees and Workers Organization v.
|||

People's Industrial and Commercial Corp., G.R. No. L-37687, [March 15, 1982],
198 PHIL 166-183)

[G.R. No. 123276. August 18, 1997.]

MARIO TIU and JONATHAN HAYUHAY, petitioner, vs.

NATIONAL LABOR RELATIONS COMMISSION and REPUBLIC
BROADCASTING SYSTEM, INC. (CHANNEL 7), respondent.

Sentro ng Alternatibong Lingap Panlegal (SALIGAN) for petitioners.

Belo Gozon Elma Parel Asuncion & Lucila for private respondent.

SYNOPSIS

This is a petition for certiorari under Rule 65 of the Rules of Court.

Petitioners herein prayed to annul and set aside the resolution of the National
Labor Relations Commission affirming the decision of labor arbiter. The labor
arbiter held that the strike conducted by GMA Channel 7 Employees Union:
(GMAEU) was illegal and declared fourteen of its officers who knowingly
participated in the illegal strike to have lost their employment status. Ten officers
involved in the strike did not appeal the labor arbiter's decision and opted to avail
of the optional retirement benefits under the collective bargaining agreement with
the Republic Broadcasting System Inc. (RBS). The remaining four union officers
appealed to the NLRC. From the NLRC decision, Virgilio Santoyo filed a
separate opinion for certiorari before the Supreme Court, which the latter
dismissed. In contrast to Santoyo's petition, which was procedural in character,
the present petition raised substantive issues concerning the legality of the strike
conducted by GMAEU. ITEcAD
 The Court, however, also found no merit in the petition at bar. The Court
affirmed the factual finding of the labor arbiter and the NLRC that there was no
strikeable issue to support the subject strike. The evidence showed that the
union anchored its position on alleged unfair labor practices in order to evade not
only the grievance machinery but also the strike clause in their collective
bargaining agreement with RBS.

SYLLABUS

1. LABOR AND SOCIAL LEGISLATION; LABOR RELATIONS; STRIKES;

IT IS NOT ENOUGH THAT THE UNION BELIEVED THAT THE EMPLOYER
COMMITTED ACTS OR UNFAIR LABOR PRACTICE WHEN THE
CIRCUMSTANCES CLEARLY NEGATE EVEN APRIMA FACIE SHOWING TO
WARRANT SUCH A BELIEF. — Petitioners plead that their contemporaneous
acts, reckoned from their 26 June 1991 letter to RBS up to the actual strike held
on 2 August 1991, were justified based on its honest belief that RBS was
committing unfair labor practices. Stated otherwise, "the presumption of legality
(of the strike) prevails even if the allegations of unfair labor practices are
subsequently found out to be untrue." (citing Master Iron Labor Union v.
NLRC, 219 SCRA 47) The Court is not unmindful of this rule, but in the case at
bar the facts and the evidence did not establish even at least a rational basis why
the union would wield a strike based on alleged unfair labor practices it did not
even bother to substantiate during the conciliation proceedings. It is not enough
that the union believed that the employer committed acts of unfair labor practice
when the circumstances clearly negate even a prima facie showing to warrant
such a belief.
2. ID.; ID.; ID.; IN DISREGARDING THE GRIEVANCE MACHINERY THE
UNION LEADERS WHO KNOWINGLY PARTICIPATED IN THE LEGAL STRIKE
HAVE ACTED UNREASONABLY AND AS SUCH, THE LAW CANNOT
INTERPOSE ITS HAND TO PROTECT THEM FROM THE CONSEQUENCES
OF THEIR BEHAVIOR. — Even assuming arguendo that in the issuance of said
guidelines RBS may have violated some provisions in the collective bargaining
agreement, there was no palpable showing that the same was
a flagrant and/or malicious refusal to comply with its economic provisions. (Book
V Implementing Rules of the Labor Code, Rule XIII, Section 1) Hence, the law
mandates that said violation "shall not be considered unfair labor practice and
shall not be strikeable." The bottom line is that the union should have
immediately resorted to the grievance machinery established in their agreement
with RBS. In disregarding said procedure the union leaders who knowingly
participated in the illegal strike "have acted unreasonably, and, as such, the law
cannot interpose its hand to protect them from the consequences of their
behavior." (National Labor Union v. Philippine Match Factory, 70 Phil.
300; United Seamen's Union v. Davao Shipowner's Association, 20 SCRA 1226).

DECISION

PADILLA, J : p

This is a petition for certiorari under Rule 65 of the Rules of Court to annul
and set aside the resolution of the National Labor Relations Commission
(NLRC) dated 28 November 1994 in NCR Case No. 00-08-0453-91 which
affirmed the decision of labor arbiter Edgardo Madriaga dated 18 February
1994 holding the strike held by GMA Channel 7 Employees Union (GMAEU)
on 2 August 1991 as illegal and declaring the fourteen (14) GMAEU union
officers who knowingly participated in the illegal strike to have lost their
employment status. cdphil

The records show that of the fourteen (14) GMAEU officers involved in the
strike, ten (10) officers did not appeal the labor arbiter's decision and opted to
avail of the optional retirement benefits under the collective bargaining
agreement with private respondent Republic Broadcasting System Inc. (RBS).
The remaining four (4) union officers, namely: Mario Tiu, Nani Hayuhay, Bong
Cerezo and Virgilio Santoyo, appealed to the NLRC.
From the NLRC decision, Virgilio Santoyo filed a separate petition for
certiorari before this Court, docketed as G.R. No. 122613. In a resolution dated
31 January 1996, the Court dismissed Santoyo's petition "for failure to sufficiently
show that the respondent Commission (NLRC) had committed a grave abuse of
discretion in rendering the questioned judgment."
Considering that Santoyo and herein petitioners were dismissed under the
same factual circumstance, the Court reviewed the records of G.R. No. 122613
to determine whether the ruling laid therein applies in the case at bar. The Court
notes that the issues raised by Santoyo in his petition were procedural in
character. Santoyo alleged that he was never represented by counsel in the
proceedings both before the labor arbiter and the NLRC and was denied the
opportunity to present his evidence. This allegation, however, had no factual
basis as the records showed that he was represented by counsel during the
entire proceedings below. In contrast, the present petition raised substantive
issues concerning the legality or illegality of the strike conducted by GMAEU on 2
August 1991.
The Court required both public and private respondents to file their
comment on the petition. Private respondent RBS filed its comment on 23 April
1996 and public respondent NLRC filed its own comment on 9 December 1996.
Petitioners filed a reply to both comments on 4 March 1997. Since the parties
have exhaustively argued their position in their respective pleadings, the Court
dispensed with the filing of memoranda and considered this case submitted for
resolution.
The material and relevant facts are as follows:
RBS had a collective bargaining agreement with GMAEU which took effect
on 2 July 1989. After the first quarter of 1991, RBS management noted the huge
amount of overtime expense it incurred during the said period, which averaged to
P363,085.26 monthly. To streamline its operations, the president of RBS created
a committee to formulate guidelines on the availment of leaves and rendering of
overtime work.
On 11 June 1991, RBS, through its personnel department, furnished
GMAEU a copy of the new guidelines and requested the letter to comment
thereon. The union did not file any comment. On 25 June 1991, RBS officially
issued the implementing guidelines "on the availment of leaves and rendering of
overtime services." The following day, GMAEU sent a letter to the president of
RBS wherein it argued that:
1. The union was not consulted in the formulation of said guidelines
which was a clear violation under Sec. 3(c) of the collective
bargaining agreement;
2. The guidelines would render nugatory the collective bargaining
agreement provisions on the same subject;
3. The diminution of benefits being enjoyed by all employees with
respect to the mid-year bonuses (from 2-1/2 months to 1 1/2
months constitutes a withdrawal of an existing company policy).
Thereafter, RBS management and GMAEU officials met on 3 July 1991
and on 10 July 1991 to thresh out the issues raised by GMAEU in its 26 June
1991 letter. Both talks, however, were short lived as the union refused to hold
further talks with RBS.
On 12 July 1991, GMAEU filed, a Notice of Strike with the National
Conciliation and Mediation Board (NCMB) based on unfair labor practices
allegedly committed by RBS, as follows:
1. Gross violation of the existing collective bargaining agreement;
2. Employees (members and officers) coercion;
3. Union interference; and
4. Discrimination.
 The NCMB set a conciliation meeting on 19 July 1991, but as early as 16
July 1991 the Union held a strike vote among its members and submitted the
results thereof to the NCMB on 18 July 1991 which showed that majority of the
union members voted to go on strike.
During the conciliation meeting held on 19 July 1991, RBS, through
counsel, informed GMAEU's officers that RBS did not violate any provision in the
collective bargaining agreement since the issuance of the guidelines was a
management prerogative duly recognized in their agreement. As regards
GMAEU's charges of coercion, union interference and discrimination, RBS
argued that these alleged unfair labor practices were neither raised by the union
in its 26 June 1991 letter nor during their 3 July and 10 July 1991 talks. RBS'
counsel requested GMAEU's officers to name the persons or officers of RBS
involved in the alleged unfair labor practices and to state the specific act or acts
complained of so that RBS management could adequately refute said allegations
or impose appropriate disciplinary actions against its erring officers. GMAEU's
officers, however, ignored both RBS' and the labor conciliator's requests for a bill
of particulars.
In a second conciliation meeting held on 25 July 1991, RBS reiterated its
request to GMAEU's officers to furnish RBS the details of the alleged unfair labor
practices committed by RBS' officers. Again, the Union denied RBS' request and
refused to hold any further talks with RBS management. On the same day, RBS
filed a motion to dismiss GMAEU's notice of strike and forewarned the Union
about the consequences of an illegal strike.
On 2 August 1991, the union struck. On the same day, RBS filed a
complaint for illegal strike and unfair labor practice against GMAEU and its
fourteen (14) officers (hereafter, illegal strike case). The case was docketed as
NLRC Case 00-08-04531-91. Meanwhile, the Secretary of Labor immediately
assumed jurisdiction over the case, issued a return-to-work order, and certified
the case to the NLRC for compulsory arbitration (hereafter, certified case). The
case was docketed as NCMB-NCR-050-7-488-91.
In the certified case, the labor arbiter found no factual and legal ground to
hold RBS guilty of unfair labor practices against the Union. On appeal (docketed
as NLRC-NCR CC No. 00076-01), the NLRC affirmed the labor arbiter's decision
in a resolution dated 31 July 1992.
Meanwhile, the labor arbiter continued to hear the illegal strike case filed
by RBS against GMAEU. On 18 February 1994, the labor arbiter rendered
judgment declaring the strike illegal and the union officers who knowingly
participated in the illegal strike to have validly lost their employment status based
on the following reasons:
 a. "The notice of strike did not specifically charge the company (RBS) of
unfair labor practices, only pro formaallegations of gross violation
of the collective bargaining agreement, employees coercion,
union interference, and discrimination." It is "defective as it
consisted of vague and general charges which could not be
substantiated and which the company could not properly defend
itself against."
b. "The absence of evidence on record that the mandatory cooling-off
period and strike vote under the law were complied which renders
the strike staged by the respondents illegal per se on technical
grounds." LexLib

c. "On the merits . . . there are no strikeable grounds as there was no

bargaining deadlock between the parties. The alleged gross
violation of the collective bargaining agreement cannot constitute
an unfair labor practice because said charges were bereft of
factual and legal basis. There being no unfair labor practice, it
follows that there is no strikeable issue to support the strike
conducted by herein respondents (the Union)."
d. The union violated the no strike-no lockout clause of the CBA with
RBS; thus rendering the strike held on 2 August 1991 illegal. As
aforementioned, the NLRC affirmed the labor arbiter's decision in
a resolution dated 28 November 1994.
In their petition, petitioner raised six (6) alleged NLRC errors which
ultimately narrow down to one issue —
WHETHER OR NOT THE NLRC COMMITTED GRAVE ABUSE OF
DISCRETION WHEN IT UPHELD THE LABOR ARBITER'S DECISION
THAT PETITIONERS STAGED AN ILLEGAL STRIKE ON 2 AUGUST
1991.
Petitioners argue that any defect in their pro-forma notice of strike was
cured when the NCMB took cognizance of the case and conducted conciliation
proceedings on 19 July and 25 July 1991. In addition, upon assumption by the
Secretary of Labor of jurisdiction over the dispute and certification of the same for
compulsory arbitration, it is presumed that the union had complied with the
procedural requirements under the labor code for a valid notice of strike.
Anent the alleged unfair labor practice committed by RBS, petitioners
assert that this issue was thoroughly discussed with sufficient particularity in their
position papers filed in the certified case and in the illegal strike case; hence,
"their notice of strike was sufficient in form and in substance."
Petitioners further argue that they believed in good faith that RBS had
committed acts of unfair labor practice which induced them to proceed with the
strike on 2 August 1991. Since it was an unfair labor practice strike, the no-strike
clause in the collective bargaining agreement with RBS does not apply. They
also showed good faith by their immediate compliance with the return-to-work
order issued by the Secretary of Labor upon assuming jurisdiction over the case.
Private respondent RBS refutes these arguments and asserts that the
factual findings of the labor arbiter and the NLRC, being supported by substantial
evidence, should be upheld by this Court. This means that petitioners cannot
invoke the protective mantle of the good faith strike doctrine because the alleged
issues in the notice of strike were never substantiated by the union either before
or during the conciliation proceedings. The union violated the no-strike clause
under the collective bargaining agreement and should be held accountable for
their acts by considering them validly dismissed from their employment with RBS.
We find no merit in the petition at bar.
The notice of strike filed by the union before the NCMB on 12 July 1991
contained general allegations that RBS management committed unfair labor
practices by its gross violation of the economic provisions in their collective
bargaining agreement and by alleged acts of coercion, union interference and
discrimination which amounted to union busting. It is the union, therefore, who
had the burden of proof to present substantial evidence to support these
allegations.
It is not disputed that prior to 12 July 1991, the union treated RBS'
issuance of the "guidelines on the availment of leaves and rendering of overtime
services" as "gross" violations of the existing collective bargaining agreement. In
its talks with the union, RBS painstakingly explained that the said allegation was
unfounded because the issuance of said guidelines was RBS' management
prerogative. Up to that point, the union never raised the issue of unfair labor
practices allegedly committed by RBS' officials under Article 248 of the Labor
Code. But in its notice of strike filed two days later, the union raised issues of
coercion, discrimination, and union interference for the first time.
Significantly, the union had two (2) conciliatory meetings arranged by the
NCMB at which it could have substantiated these additional allegations.
However, the fact that it had submitted the results of the strike vote even ahead
of the conciliatory meetings, and continuously refused to substantiate its
allegations in its notice of strike thereafter, lends credence to the NLRC's
observation that these charges were indiscriminately hurled against RBS to give
a semblance of validity to its notice of strike.
Under Rule XIII Sec. 4 Book V of the Implementing Rules of the Labor
Code. —
". . . In cases of unfair labor practices, the notice of strike shall as
far as practicable, state the acts complained of and the efforts to resolve
the dispute amicably."
 Upon the other hand, Rule III Sec. 6 provides that
"xxx xxx xxx
During the (conciliation) proceeding, the parties shall not do any
act which may disrupt or impede the early settlement of the dispute.
They are obliged, as part of their duty to bargain collectively in good
faith, to participate fully and promptly in the conciliation meetings called
by the regional branch of the board . . ." (emphasis supplied)
Petitioners plead that their contemporaneous acts, reckoned from their 26
June 1991 letter to RBS up to the actual strike held on 2 August 1991, were
justified based on its honest belief that RBS was committing unfair labor
practices. Stated otherwise, "the presumption of legality (of the strike) prevails
even if the allegations of unfair labor practices are subsequently found out to be
untrue." (citing Master Iron Labor Union v. NLRC, 219 SCRA 47)
The Court is not unmindful of this rule, but in the case at bar the facts and
the evidence did not establish even at least a rational basis why the union would
wield a strike based on alleged unfair labor practices it did not even bother to
substantiate during the conciliation proceedings. It is not enough that the union
believed that the employer committed acts of unfair labor practice when the
circumstances clearly negate even a prima facie showing to warrant such a
belief.
The Court affirms the factual finding of the labor arbiter and the NLRC that
"there was no strikeable issue to support respondent's (the Union) subject strike."
The evidence show that the union anchored its position on alleged unfair labor
practices in order to evade not only the grievance machinery but also the no
strike clause in their collective bargaining agreement with RBS.
RBS did not issue its implementing guidelines dated 24 June 1991
concerning the availment of leaves and rendering of overtime services in an
arbitrary manner. The union was promptly informed that RBS' decision was
based on its management prerogative to regulate all aspects of employment,
subject of course to well-defined limitations imposed by law or by contract.
Even assuming arguendo that in the issuance of said guidelines RBS may
have violated some provisions in the collective bargaining agreement, there was
no palpable showing that the same was a flagrant and/or malicious refusal to
comply with its economic provisions. (Book V Implementing Rules of the Labor
Code, Rule XIII, Section 1) Hence, the law mandates that said violation "shall not
be considered unfair labor practice and shall not be strikeable."
The bottom line is that the union should have immediately resorted to the
grievance machinery established in their agreement with RBS. In disregarding
said procedure the union leaders who knowingly participated in the illegal strike
"have acted unreasonably, and, as such, the law cannot interpose its hand to
protect them from the consequences of their behavior." (National Labor Union
v. Philippine Match Factory, 70 Phil. 300; United Seamen's Union v. Davao
Shipowner's Association, 20 SCRA 1226) cdasia

WHEREFORE, premises considered, the petition is hereby DISMISSED,

there being no substantial evidence of grave abuse of discretion amounting to
lack or excess of jurisdiction on the part of the NLRC.
SO ORDERED.
(Tiu v. National Labor Relations Commission, G.R. No. 123276, [August 18,
|||

1997], 343 PHIL 478-488)

[G.R. Nos. L-30632-33. April 11, 1972.]

CALTEX FILIPINO MANAGERS AND SUPERVISORS

ASSOCIATION, petitioner, vs. COURT OF INDUSTRIAL
RELATIONS, CALTEX (PHILIPPINES), INC., W. E. MENEFEE
and B. R. EDWARDS, respondents.

Domingo E. de Lara & Associates for petitioner.

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

DECISION

VILLAMOR, J : p

This is an appeal by the Caltex Filipino Managers and Supervisors'

Association from the resolution en banc dated May 16, 1969 of the Court of
Industrial Relations affirming the decision dated February 26, 1969 of
Associate Judge Emiliano G. Tabigne, Associate Judge Ansberto P. Paredes
dissented from the resolution of the majority on the ground that the Industrial
Court in a representation case cannot take cognizance of the issue of illegality
of a strike and proceed to declare the loss of the employee status of
employees inasmuch as that matter ought to be processed as an unfair labor
practice case. Judge Tabigne's decision covers two cases, namely, Case No.
 1484-MC(1) in which he declared the strike staged on April 22, 1965 by the
Association as illegal with the consequent forfeiture of the employee status of
three employees (Jose J. Mapa, President of the Association; Dominador
Mangalino, Vice-President; and Herminigildo Mandanas) and Case No. 4344-
ULP filed against Caltex (Philippines), Inc., Ben F. Edwards and W.E.
Menefee which Judge Tabigne dismissed for lack of merit and substantial
evidence.

The following proceedings gave rise to the present appeal:

The Caltex Filipino Managers and Supervisors' Association is a labor
organization of Filipino managers and supervisors in Caltex (Philippines), Inc.,
respondent Company in this proceeding. After the Association was registered as
a labor organization it sent a letter to the Company on January 21, 1965
informing the latter of the former's registration; the Company replied inquiring on
the position titles of the employees which the Association sought to represent.
On February 8, 1965 the Association sent a set of proposals to the Company
wherein one of the demands was the recognition of the Association as the duly
authorized bargaining agency for managers and supervisors in the Company. To
this the Company countered stating that a distinction exists between
representatives of management and individuals employed as supervisors and
that it is the Company's belief that managerial employees are not qualified for
membership in a labor organization; hence, it suggested that the Association
institute a certification proceeding so as to remove any question with regard to
position titles that should be included in the bargaining unit. The Association felt
disinclined to follow the suggestion of the Company 1 and so on February 22,
1965 the Company initiated a certification proceeding docketed as Case No.
1484-MC.
On March 8, 1965 the Association filed notice to strike giving the following
reasons:
"Refusal to bargain in good faith and to act on demands, a
copy of which is enclosed; resort to union-busting tactics in order to
discourage the activities of the undersigned association and its
members, including discrimination and intimidation of officers and
members of the association and circulation of promises of
immediate benefits to be given by the company to its employees,
officers and members of this association or those intending to join
the same, if the employees concerned in due course will vote
against the selection of this association as the exclusive collective
bargaining unit for managers and supervisors of the Company in
the petition for certification the latter filed." (Annex "A" of Annex "A",
Petition).
On March 29, 1965, during the hearing of the certification proceedings, Judge
Tabigne cautioned the parties to maintain thestatus quo; he specifically advised
the employees not to go on strike, making it clear, however, that in the presence
of unfair labor practices they could go on strike even without any notice. 2
On the basis of the strike notice filed on March 8, 1965 and in view of acts
committed by the Company which the Association considered as constituting
unfair labor practice, the Association struck on April 22, 1965, after the efforts
exerted by the Bureau of Labor Relations to settle the differences between the
parties failed. Then, through an "Urgent Petition" dated April 26, 1965 filed as
Case No 1484-MC(1), or as an incident of the certification election proceedings
(Case No. 1484-MC), the Company prayed as follows:
"WHEREFORE, petitioner respectfully prays this Honorable
Court that:
1. The strike of respondent Caltex Filipino Managers and
Supervisors Association be declared illegal:
2. The officers and members of respondent association who
have instigated, declared, encouraged and/or participated in the
illegal strike be held and punished for contempt of this Honorable
Court and be declared to have lost their employee status;
3. Pending hearing on the merits and upon the filing of a
bond in an amount to be fixed by this Honorable Court, a temporary
injunction be issued restraining respondent association, its officers,
members and representatives acting for and on their behalf from
committing, causing or directing the commission of the unlawful
acts complained of, particularly obstructing and preventing
petitioner, its customers, officers and non-striking employees from
entering and going out of its various offices, in its refinery,
installations, depots and terminals and the use or threat of violence
and intimidation;
4. After trial, said injunction be made permanent;
5. The damages that petitioner has suffered and will suffer
up to the trial of this action be ascertained and judgment be
rendered against respondent association, its officers, members and
representatives jointly and severally for the amount thereof.
"Petitioner prays for such other and further relief as this
Honorable Court may deem just and equitable in the premises."
(Annex "D", Petition)
Such urgent petition was frontally met by the Association with a motion to dismiss
questioning the jurisdiction of the industrial court. The motion to dismiss was
opposed by the Company and on May 17, 1965 the trial court denied the same.
Not satisfied with the order of May 17, 1965, the Association moved for its
reconsideration before respondent court en banc.
Because of the settlement between the parties on May 30, 1965 of some of their
disputes, the Association filed with respondent court under date of June 3, 1965
a manifestation (to which was attached a copy of the return-to-work agreement
signed by the parties on May 30, 1965), to the effect that the issues in Case No.
1484-MC(1) had become moot and academic. Under date of June 15, 1965 the
Company filed a counter-manifestation disputing the representations of the
Association on the effect of the return-to-work agreement. On the basis of the
manifestation and counter-manifestation, respondent court en banc issued a
resolution on August 24, 1965 allowing the withdrawal of the Association's motion
for reconsideration against the order of May 17, 1965, on the theory that there
was justification for such withdrawal.
Relative to the resolution of August 24, 1965 the Company filed a motion for
clarification which the Association opposed on September 22, 1965, for it
contended that such motion was in reality a motion for reconsideration and as
such filed out of time. But respondent court brushed aside the Association's
opposition and proceeded to clarify the resolution of August 24, 1965 to mean
that the Company was not barred from continuing with Case No. 1484-MC(1).
At the hearing on September 1, 1965 of Case No. 1484-MC(1) the Association
insisted that the incident had become moot and academic and must be
considered dismissed and, at the same time, it offered to present evidence, if still
necessary, in order to support its contention. Respondent court thereupon
decided to secure evidence from the parties to enlighten it on the interpretation of
the provisions of the return-to-work agreement relied upon by the Association as
rendering the issues raised in Case No. 1484-MC(1) already moot and academic.
Evidence having been received, the trial court ruled in its order of February 15,
1966 that under the return-to-work agreement the Company had reserved its
rights to prosecute Case No. 1484-MC(1) and, accordingly, directed that the case
be set for hearing covering the alleged illegality of the strike. Within the
prescribed period the Association filed a motion for reconsideration of the
February 15, 1966 order to which motion the Company filed its opposition and, in
due course, respondent court en banc issued its resolution dated March 28, 1966
affirming the order. Appeal from the interlocutory order was elevated by the
Association to this Court in G.R. No. L-25955, but the corresponding petition for
review was summarily "DISMISSED for being premature" under this Court's
resolution of May 13, 1966.
After a protracted preliminary investigation, the Association's charge for unfair
labor practices against the Company and its officials docketed in a separate
proceeding was given due course through the filing by the prosecution division of
respondent court of the corresponding complaint dated September 10, 1965, in
Case No. 4344-ULP against Caltex (Philippines), Inc., W. E. Menefee and B.F.
Edwards. As noted by respondent court in its decision under review, Case No.
4344-ULP was filed by the Association because, according to the latter, the
Company and some of its officials, including B.F. Edwards, inquired into the
organization of the Association and he manifested his antagonism to it and its
President; that another Company official, W.E. Menefee, issued a statement of
policy designed to discourage employees and supervisors from joining labor
organizations; that the Company refused to bargain although the Association
commands majority representation; that due to the steps taken by the Company
to destroy the Association or discourage its members from continuing their union
membership, the Association was forced to file a strike notice; that on April 22,
1965 it declared a strike; and that during the strike the Company and its officers
continued their efforts to weaken the Association as well as its picket lines. The
Company in its answer filed with respondent court denied the charges of unfair
labor practice.

Considering the interrelation of the issues involved in the two cases and by
agreement of the parties, the two cases were heard jointly. This explains why
only one decision was rendered by respondent court covering both Case No.
1484-MC(1), relating to the illegality of the strike as contended by the Company,
and Case No. 4344-ULP, referring to the unfair labor practice case filed by the
Association against the Company, W. E. Menefee and B. F. Edwards.
The Association assigned the following errors allegedly committed by respondent
court:
I
"RESPONDENT COURT ERRED IN ASSUMING
JURISDICTION OVER CASE NO. 1484-MC(1).
II
ASSUMING THAT RESPONDENT COURT HAS
JURISDICTION OVER CASE NO. 1484-MC(1), IT ERRED IN NOT
HOLDING THAT THE SAME ALREADY BECAME MOOT WITH
THE SIGNING OF THE RETURN TO WORK AGREEMENT ON
MAY 30, 1965.
III
ASSUMING LIKEWISE THAT RESPONDENT COURT HAS
JURISDICTION OVER CASE NO, 1484-MC(1) IT ERRED IN
HOLDING THAT CAFIMSA'S STRIKE WAS STAGED FOR NO
OTHER REASON THAN TO COERCE THE COMPANY INTO
RECOGNIZING THE CAFIMSA AND THAT SUCH STRIKE WAS
UNJUSTIFIED, UNLAWFUL AND UNWARRANTED.
 IV
RESPONDENT COURT ERRED IN AFFIRMING THE
TRIAL COURT'S CONCLUSION THAT CAFIMSA'S STRIKE WAS
DECLARED IN OPEN DEFIANCE OF THE MARCH 29, 1965
ORDER IN CERTIFICATION CASE NO. 1484-MC.
V
RESPONDENT COURT ERRED IN AFFIRMING THE
TRIAL COURT'S FINDING, DESPITE THE SUBSTANTIAL
CONTRARY EVIDENCE ON RECORD THAT THE STRIKERS
RESORTED TO MEANS BEYOND THE PALE OF THE LAW IN
THE PROSECUTION OF THE STRIKE AND IN DISREGARDING
THE CONSIDERATION THAT THE STRIKERS MERELY
EMPLOYED LAWFUL ACTS OF SELF-PRESERVATION AND
SELF-DEFENSE.
VI
RESPONDENT COURT ERRED IN AFFIRMING THE
DISMISSAL BY THE TRIAL COURT OF J.J. MAPA, CAFIMSA'S
PRESIDENT, AND OTHERS, OR IN OTHERWISE PENALIZING
THE STRIKERS.
VII
ASSUMING ARGUENDO THAT THE FACTS FOUND BY
THE TRIAL COURT SHOULD BE ACCEPTED, IN DISREGARD
OF THE EVIDENCE PRESENTED BY THE COMPANY
DAMAGING TO ITS CAUSE, OR ALTHOUGH THE TRIAL COURT
DISREGARDED THE SUBSTANTIAL INCRIMINATORY
EVIDENCE AGAINST THE COMPANY, RESPONDENT COURT
ERRED IN NOT APPLYING THE PRINCIPLE OF IN PARI
DELICTO.
VIII
RESPONDENT COURT ERRED IN FAILING TO HOLD
THAT THE COMPANY IS BARRED UNDER SECTION 9(e) OF
THE REPUBLIC ACT NO. 875 FROM SEEKING THE RELIEF
PRAYED FOR IN CASE NO. 1484-MC(1).
IX
RESPONDENT COURT ERRED IN ENTIRELY
ABSOLVING THE COMPANY FROM THE UNFAIR LABOR
PRACTICE CHARGE AND IN DISREGARDING THE
SUBSTANTIAL INCRIMINATORY EVIDENCE RELATIVE
THERETO AGAINST THE COMPANY.
X
 RESPONDENT COURT ERRED IN RENDERING
JUDGMENT FOR THE CAFIMSA IN CASE NO. 4344-ULP AND IN
NOT ORDERING THE COMPANY TO PAY BACK WAGES AND
ATTORNEY'S FEES.
XI
RESPONDENT COURT ERRED IN PREMATURELY
IMPLEMENTING THE TRIAL COURT'S DISMISSAL OF J.J.
MAPA AND DOMINADOR MANGALINO." (Brief for the Petitioner,
pp. 1-4).
To our mind the issues raised in this appeal may be narrowed down to the
following:
1. Whether or not the Court of Industrial Relations has jurisdiction over Case No.
1484-MC(1);
2. Whether or not the strike staged by the Association on April 22, 1965 is illegal
and, incident thereto, whether respondent court correctly terminated the
employee status of Jose Mapa, Dominador Mangalino and Herminigildo
Mandanas and reprimanded and admonished the other officers of the
Association; and
3. Whether or not respondent court correctly absolved the respondents in Case
No. 4344-ULP from the unfair labor practice charge.
Respondent's court's jurisdiction over Case No. 1484-MC(1) has to be tested by
the allegations of the "Urgent Petition" dated April 26, 1965 filed by the Company
in relation to the applicable provisions of law. A reading of said pleading shows
that the same is for injunctive relief under Section 9(d) of Republic Act No. 875
(Magna Charta of Labor); for contempt, obviously pursuant to Sec. 6
of Commonwealth Act No. 103 in conjunction with Sec. 3(b) of Rule 71 of the
Rules of Court; and for forfeiture of the employee status of the strikers by virtue
of their participation in what the Company considered as an "illegal strike."
It is well known that the scheme in Republic Act No. 875 for achieving industrial
peace rests essentially on a free and private agreement between the employer
and his employees as to the terms and conditions under which the employer is to
give work and the employees are to furnish labor, unhampered as far as possible
by judicial or administrative intervention. On this premise the lawmaking body
has virtually prohibited the issuance of injunctive relief involving or growing out of
labor disputes.
The prohibition to issue labor injunctions is designed to give labor a comparable
bargaining power with capital and must be liberally construed to that end (U.S.
vs. Brotherhood of Locomotive Engineers, 79 F. Supp. 485, Certiorari denied, 69
S. Ct. 137, 335 U.S. 867, cause remanded on other grounds, 174 F. 2nd 160, 85
U.S. App. D.C., certiorari denied 70 S. Ct. 140, 338 U.S. 872, 94 L. Ed. 535). It is
said that the prohibition creates substantive and not purely procedural law.
(Oregon Shipbuilding Corporation vs. National Labor Relations Board, 49 F.
Supp. 386). Within the purview of our ruling, speaking through Justice Labrador,
in Social Security Employees Association (PAFLU), et al. vs. The Hon. Edilberto
Soriano, et al. (G.R. No. L-20100, July 16, 1964, 11 SCRA 518, 520), there can
be no injunction issued against any strike except in only one instance, that is,
when a labor dispute arises in an industry indispensable to the national interest
and such dispute is certified by the President of the Philippines to the Court of
Industrial Relations in compliance with Sec. 10 of Republic Act No. 875. As a
corollary to this, an injunction in an uncertified case must be based on the strict
requirements of Sec. 9(d) of Republic Act No. 875; the purpose of such an
injunction is not to enjoin the strike itself, but only unlawful activities. To the
extent, then, that the Company sought injunctive relief under Sec. 9(d)
of Republic Act No. 875, respondent court had jurisdiction over the Company's
"Urgent Petition" dated April 26, 1965.
As to the "contempt aspect" of Case No. 1484-MC(1), the jurisdiction of
respondent court over it cannot be seriously questioned it appearing that Judge
Tabigne in good faith thought that his "advice" to the Association during the
hearing on March 29, 1965 not to strike amounted to a valid order. This is not to
say, however that respondent court did not err in finding that the advice given by
Judge Tabigne during the hearing on March 29, 1965 really constituted an order
which can be the basis of a contempt proceeding. For, in our opinion, what Judge
Tabigne stated during said hearing should be construed what actually it was —
an advice. To say that it was an order would be to concede that respondent court
could validly enjoin a strike, especially one which is not certified in accordance
with Sec. 10 of Republic Act No. 875. To adopt the view of respondent court
would not only set at naught the policy of the law as embodied in the said statute
against issuance of injunctions, but also remove from the hands of labor unions
and aggrieved employees an effective lawful weapon to either secure favorable
action on their economic demands or to stop unfair labor practices on the part of
their employer.
With respect to the alleged "illegality of the strike," as claimed by the Company,
and the consequent forfeiture of the employee status of the strikers, we believe
these are matters which are neither pertinent to nor connected with a certification
case as opined by Judge Paredes, to which we agree. Respondent court,
therefore, initially erred in entertaining this issue in Case No. 1484-MC(1). No
prejudice, however, has resulted since, as correctly pointed out by respondent
court, the illegality for the strike was squarely raised by the Company as a
defense in Case No. 4344-ULP and, in any event, we observe that the
Association was given all the opportunity to put forward its evidence.
We now come to the important issue as to whether the strike staged by the
Association on April 22, 1965 is illegal. From an examination of the records, we
believe that the lower court erred in its findings in this regard.
To begin with, we view the return-to-work agreement of May 30, 1965 as in the
nature of a partial compromise between the parties and, more important, a labor
contract; consequently, in the latter aspect the same "must yield to the common
good" (Art. 1700, Civil Code of the Philippines) and "(I)n case of doubt . . . shall
be construed in favor of the safety and decent living for the laborer" (Art. 1702,
ibid). To our mind when the Company unqualifiedly bound itself in the return-to-
work agreement that all employees will be taken back "with the same employee
status prior to April 22, 1965," the Company thereby made manifest its intention
and conformity not to proceed with Case No. 1484-MC(c) relating the illegality of
the strike incident. For while it is true that there is a reservation in the return-to-
work agreement as follows:
"6. The parties agree that all Court cases now pending shall
continue, including CIR Case No. 1484-MC."
we think the same is to be construed bearing in mind the conduct and
intention of the parties. The failure to mention Case No. 1484-MC (1) while
specifically mentioning Case No. 1484-MC, in our opinion, bars the Company
from proceeding with the former especially in the light of the additional specific
stipulation that the strikers would be taken back with the same employee
status prior to the strike on April 22, 1965. The records disclose further that,
according to Atty. Domingo E. de Lara when he testified on October 9, 1965,
and this is not seriously disputed by private respondents, the purpose of
Paragraph 10 of the return-to-work agreement was, to quote in part from this
witness, "to secure the tenure of employees after the return-to-work
agreement considering that as I understand there were demotions and
suspensions of one or two employees during the strike and, moreover, there
was this incident Case No. 1484-MC(1)" (see Brief for the Petitioner, pp. 41-
42). To borrow the language of Justice J.B.L. Reyes in Citizens Labor Union
Pandacan Chapter vs. Standard Vacuum Oil Company (G.R. No. L-7478, May
6, 1955), in so far as the illegality of the strike is concerned in this proceeding
and in the light of the records.

". . . the matter had become moot. The parties had both
abandoned their original positions and come to a virtual
compromise and agreed to resume unconditionally their former
relations. To proceed with the declaration of illegality would not only
breach this understanding, freely arrived at, but to unnecessarily
revive animosities to the prejudice of industrial peace." (Italics
supplied)
Conceding arguendo that the illegality incident had not become moot and
academic, we find ourselves unable to agree with respondent court to the effect
that the strike staged by the Association on April 22, 1965 was unjustified,
unreasonable and unwarranted that it was declared in open defiance of an older
in Case No. 1484-MC not to strike; and that the Association resorted to means
beyond the pale of the law in the prosecution of the strike. As adverted to above,
the Association filed its notice to strike on March 8, 1965, giving reasons therefor
any one of which is a valid ground for a strike.
In addition, from the voluminous evidence presented by the Association, it is
clear that the strike of the Association was declared not lust for the purpose of
gaining recognition as concluded by respondent court, but also for bargaining in
bad faith on the part of the Company and by reason of unfair labor practices
committed by its officials. But even if the strike were really declared for the
purpose of recognition, the concerted activities of the officers and members of
the Association in this regard cannot be said to be unlawful nor the purpose
thereof be regarded as trivial. Significantly, in the voluntary return-to-work
agreement entered into between the Company and the Association, thereby
ending the strike, the Company agreed to recognize for membership in the
Association the position titles mentioned in Annex "B" of said agreement. 3 This
goes to show that striking for recognition is productive of good result in so far as
a union is concerned.
Besides, one of the important rights recognized by the Magna Charta of Labor is
the right to self-organization and we do not hesitate to say that is the cornerstone
of this monumental piece of labor legislation. Indeed, because of occasional
delays incident to a certification proceeding usually attributable to dilatory tactics
employed by the employer, to a certain extent a union may be justified in
resorting to a strike. We should not be understood here as advocating a strike in
order to secure recognition of a union by the employer. On the whole we are
satisfied from the records that it is incorrect to say that the strike of the
Association was mainly for the purpose of securing recognition as a bargaining
agent.
As will be discussed hereinbelow, the charge of unfair labor practice against the
Company is well-taken. It is, therefore, clear error on the part of the Association
is unjust, unreasonable and unwarranted.
We said earlier that the advice of Judge Tabigne to maintain the status
quo cannot be considered as a lawful order within the contemplation of the
Magna Charta of Labor, particularly Section 10 thereof; to so regard it as an
order would be to grant respondent court authority to forbid a strike in an
uncertified case which it is not empowered to do. The fact that the strike was not
staged until April 22, 1965 is eloquent proof enough of the desire of the
Association and its officers and members to respect the advice of Judge
Tabigne. However, as shown in this case during the pendency of the certification
proceedings unfair labor practices were committed by the Company; hence, the
Association was justified in staging a strike and certainly this is not in violation of
the advice of Judge Tabigne on March 29, 1965.
Respondent court picked out a number of incidents. taking place during the
strike, to support its conclusion that the strikers resulted to means beyond the
pale of the law in the prosecution of a strike. Thus, it made mention on the
blocking by a banca manned by two striking supervisors by the name of
Dominador Mangalino and one Bonecillo of the Caltex M/V Estrella when it was
about to depart; the blocking at the refinery of the Company in Bauan, Batangas
of the LSCO WARA, the Hills Bros Pinatubo, and the Mobil Visayas so that they
could not dock; the blocking by the strikers of incoming vehicles, non-striking
supervisors, and rank-and-file workers to prevent them from entering the refinery
gate in Bauan, Batangas, at the Poro Terminal, at the Company's Padre Faura
office in Manila, and at the Pandacan Terminal; that at the Legaspi and
Mambulao Bulk Depots the striking supervisors refused to surrender to their
superiors the keys to the depots and storage tanks; and that also at the Legaspi
Depot the truck ignition keys were mixed up or thrown at the seats of the trucks
in violation of the Company regulations in order to create confusion and thus
prevent the trucks from being used. 4 To refute these and similar findings of
respondent court the Association, drawing chief y and abundantly from the
Company's own evidence, 5 called attention to the exculpatory declarations of the
Company's own witnesses 6 either establishing or tending to establish that the
picketing by the strikers was generally peaceful and orderly. We find that such,
indeed, was the real situation during the strike and it would be the height of
injustice to rule otherwise in the face of the records before us.
In ignoring strong evidence coming from the witnesses of the Company
damaging to its case as well as that adduced by the Association also damaging
to the Company's case, we believe that respondent court clearly and gravely
abused its discretion thereby justifying us to review or alter its factual findings
(see Philippine Educational Institution vs. MLQSEA Faculty Association, 26
SCRA 272. 278). 7 There is thus here, to employ the language of Justice J.B.L.
Reyes in Lakas ng Pagkakaisa sa Peter Paul vs. Court of Industrial Relations, 96
Phil., 63, "an infringement of cardinal primary rights of petitioner, and justified the
interposition of the corrective powers of this Court (Ang Tibay vs. Court of
Industrial Relations and National Labor Union, 69 Phil., 635):
"(2) Not only must the party be given an opportunity to
present his case and to adduce evidence tending to establish the
rights which he asserts but the tribunal must consider the evidence
presented. (Chief Justice Hughes in Morgan vs. U.S., 298 U.S.
468, 56 S. Ct. 906, 80 Law Ed. 1288.) In the language of this Court
in Edwards vs. McCoy, 22 Phil., 598, 'the right to adduce evidence,
 without the corresponding duty on the part of the board to consider
it, is vain. Such right is conspicuously futile if the person or persons
to whom the evidence is presented can thrust it aside without
notice or consideration.'" (Ibid., p. 67) 8
We are convinced from the records that on the whole the means employed by
the strikers during the strike, taking into account the activities of the Company
and the non-striking employees on the same occasion, cannot be labeled as
unlawful; in other words, the Company itself through the provocative, if not
unlawful, acts of the non-striking employees 9 is not entirely blameless for the
isolated incidents relied upon by respondent court as tainting the picketing of the
strikers with illegality. As we said through Justice Fernando in Shell Oil Workers'
Union vs. Shell Company of the Philippines, Ltd., L-28607, May 31, 1971, 39
SCRA 276:
"6. Respondent court was likewise impelled to consider the
strike illegal because of the violence that attended it. What is
clearly within the law is the concerted activity of cessation of work
in order that a union's economic demands may be granted or that
an employer cease and desist from the unfair labor practice. That
the law recognizes as a right. There is though a disapproval of the
utilization of force to attain such an objective. For implicit in the very
concept of a legal order is the maintenance of peaceful ways. A
strike otherwise valid, if violent, in character, may be placed beyond
the pale. Care is to be taken, however, especially where an unfair
labor practice is involved, to avoid stamping it with illegality just
because it is tainted by such acts. To avoid rendering illusory the
recognition of the right to strike, responsibility in such a case should
be individual and not collective. A different conclusion would be
called for, of course, if the existence of force while the strike lasts is
pervasive and widespread, consistently and deliberately resorted to
as a matter of policy. It could be reasonably concluded then that
even if justified as to end, it becomes illegal because of the means
employed." (Ibid., p. 292; italics supplied).
In the same case we further observed:
". . . Barely four months ago. in Insular Life Assurance Co.,
Ltd. Employees Association vs. Insular Life Assurance Co., Ltd.,
there is the recognition by this Court, speaking through Justice
Castro, of picketing as such being inherently explosive. It is thus
clear that not every form of violence suffices to affix the seal of
illegality on a strike or to cause the loss of employment of the guilty
party." (Ibid., pp. 293-294; italics supplied)
In the cited case of Insular Life Assurance Co., Ltd. Employees Association-
NATO, FGU Insurance Group Workers & Employees Association-NATU and
Insular Life Building Employees Association-NATU vs. The Insular Life
Assurance Co., Ltd., FGU Insurance Group, et al., L-25291, January 30, 1971,
37 SCRA 244, we held through Justice Castro, and this is here applicable to the
contention of the Association, as follows:
". . . Besides, under the circumstances the picketers were
not legally bound to yield their grounds and withdraw from the
picket lines. Being where the law expects them to be in the
legitimate exercise of their rights, they had every reason to defend
themselves and their rights from any assault or unlawful
transgression, . . ." (Ibid., p. 271)

In this cited case, by the way, we reversed and set aside the decision of the
Court of Industrial Relations and ordered the Company to reinstate the
dismissed workers with backwages.
Let us now examine the charge of unfair labor practice which respondent court
dismissed for lack of merit and substantial evidence.
Under Sec. 14(c) of Republic Act No. 875, the parties themselves are required
"to participate fully and promptly in such meetings and conferences as the
(Conciliation) Service may undertake." In this case, the parties agreed to meet on
April 21, 1965 and yet, notwithstanding this definite agreement, the Company
sent no representatives. The Company's claim to bargaining in good faith cannot
be given credence in the face of the fact that W.E. Menefee, the Company's
Managing Director, conveniently left Manila for Davao on April 17 or 18, 1965, as
admitted by W.E. Wilmarth. 10
Nowhere is there serious claim on the part of the Company that it entertains real
doubt as to the majority representation of the Association. Consider further that
admittedly the certification election proceeding for the Cebu Supervisors Union in
the Company had been pending for six (6) years already. From all appearances,
therefore, and bearing in mind the deliberate failure of the Company to attend the
conciliation meetings on April 19 and 21, 1965, it is clear that the Company
employed dilatory tactics doubtless to discredit CAFIMSA before the eyes of its
own members and prospective members as an effective bargaining agent,
postpone eventual recognition of the Association, and frustrate its efforts towards
securing favorable action on its economic demands.
It is likewise not disputed that on March 4, 1965, the Company issued its
statement of policy (Exh. B). At that time the Association was seeking recognition
as bargaining agent and has presented economic demands for the improvement
of the terms and conditions of employment of supervisors. The statement of
policy conveyed in unequivocal terms to all employees the following message:
"We sincerely believe that good employee relations can be
maintained and essential employee needs fulfilled through sound
 management administration without the necessity of employee
organization and representations. We respect an employee's right
to present his grievances, regardless of whether or not he is
represented by a labor organization." (Italics supplied)
An employee reading the foregoing would at once gain the impression that
there was no need to join the Association. For he is free to present his
grievances regardless of whether or not he is represented by a labor
organization.
The guilty conduct of the Company before, during and after the strike of April 22,
1965 cannot escape the Court's attention. It will suffice to mention typical
instances by way of illustration. Long prior to the strike, the Company had
interfered with the Cebu Supervisors' Union by enticing Mapa into leaving the
Union under the guise of a promotion in Manila; shortly before the strike, B. R.
Edwards, Manager-Operations, had inquired into the formation and organization
of the petitioner Association in this case. During the strike, in addition to the
culpable acts of the Company already narrated above, due significance must be
given to the inclusion initially of J. J. Mapa and A. Buenaventura, the
Association's President and Vice-President, respectively, in 1965, in two coercion
cases filed at that time and their subsequent elimination from the charges at the
initiative of the Company after the settlement of the strike; 11 the cutting off of
telephone facilities extended to Association members in the refinery; and the use
of a member of the Association to spy for the company. 12 The discriminatory
acts practiced by the Company against active unionists after the strike furnish
further evidence that the Company committed unfair labor practices as
charged. 13 Victims of discrimination are J. J. Mapa, A. E. Buenaventura, E. F.
Grey, Eulogio Manaay, 14 Pete Beltran, Jose Dizon, Cipriano Cruz, F. S. Miranda
and many others. The discrimination consisted in the Company's preferring non-
members of the Association in promotions to higher positions and humiliating
active unionists by either promoting junior supervisors over them or by reduction
of their authority compared to that assigned to them before the strike, or
otherwise downgrading their positions. 15
Then, effective July 1, 1969, the Company terminated the employment of J. J.
Mapa and Dominador Mangalino, President and Vice-President, respectively, of
the Association at that time, And this the Company did not hesitate to do
notwithstanding the Association's seasonable appeal from respondent court's
decision. We perceive in this particular action of the Company its anti-union
posture and attitude. In this connection, we find merit in the claim of petitioner
that the dismissal of Mapa and Mangalino was premature considering that
respondent court did not expressly provide that such dismissal might be effected
immediately despite the pendency of the appeal timely taken by the Association.
The situation would have been different had respondent court ordered the
dismissal of Mapa and Mangalino immediately. As the decision is silent on this
matter the dismissal of said officers of the Association ought to have been done
only upon the finality of the judgment. Because appeal was timely taken, the
Company's action is patently premature and is furthermore evidence of its desire
to punish said active unionists.
Verily, substantial, credible and convincing evidence appear on record
establishing beyond doubt the charge of unfair labor practices in violation of Sec.
4 (a), Nos. (1), (3), 1(4), (5) and (6), of Republic Act No. 875. And pursuant to the
mandate of Art. 24 of the Civil Code of the Philippines that courts must be vigilant
for the protection of one at a disadvantage — and here the Association appears
to be at a disadvantage in its relations with the Company as the records show —
adequate affirmative relief, including backwages, must be awarded to the
strikers. It is high-time and imperative that in order to attain the laudable
objectives of Republic Act 875 calculated to safeguard the rights of employees,
the provisions thereof should be liberally construed in favor of employees and
strictly against the employer, unless otherwise intended by or patent from the
language of the statute itself.
The Court takes judicial notice of the considerable efforts exerted by both parties
in the prosecution of their respective cases and the incidents thereof both before
the lower court and this Court since 1965 to date. Under the circumstances and
in conformity with Art. 2208, No. 11, of the Civil Code of the Philippines, it is but
just, fair and equitable that the Association be permitted to recover attorney's
fees as claimed in its tenth assignment of error.
WHEREFORE, respondent court's resolution en banc dated May 16, 1969,
together with the decision dated February 26, 1969, is reversed and judgment is
hereby rendered as follows:
1. In Case No. 1484-MC(1), the Court declares the strike of the Caltex Filipino
Managers and Supervisors' Association as legal in all respects and,
consequently, the forfeiture of the employee status of J. J. Mapa, Dominador
Mangalino and Herminigildo Mandanas is set aside. The Company is hereby
ordered to reinstate J. J. Mapa and Dominador Mangalino to their former
positions without loss of seniority and privileges, with backwages from the time of
their dismissal on July 1, 1969. Since Herminigildo Mandanas appears to have
voluntarily left the Company, no reinstatement is ordered as to him.
2. In Case No. 4344-ULP, the Court finds the Company, B. F. Edwards and W. E.
Menefee guilty of unfair labor practices and they are therefore ordered to cease
and desist from the same. In this connection, the Company is furthermore
directed to pay backwages to the striking employees from April 22, 1965 to May
30, 1965 and to pay attorney's fees which are hereby fixed at P20,000.00.
Costs against private respondents.
 (Caltex Filipino Managers and Supervisors Association v. Court of Industrial
|||

Relations, G.R. Nos. L-30632-33, [April 11, 1972], 150-A PHIL 144-166)

[G.R. No. 120505. March 25, 1999.]

ASSOCIATION OF INDEPENDENT UNIONS IN THE

PHILIPPINES (AIUP), JOEL DENSING, HENEDINO
MIRAFUENTES, CHRISTOPHER PATENTES, AND ANDRES
TEJANA, petitioners, vs. NATIONAL LABOR RELATIONS
COMMISSION (NLRC), CENAPRO CHEMICAL CORPORATION
and/or GO SING CHAN in his capacity as Managing
Director, respondents.

Audie C. Arnado for petitioners.

Angara Abello Concepcion Regala & Cruz for Cenapro Chem. Corp.

SYNOPSIS

The case under consideration is a petition for review seeking to reinstate

the decision of the Labor Arbiter insofar as it ordered the reinstatement and
payment of backwages of the four petitioners herein. The said decision was
affirmed in toto by the NLRC. On February 21, 1995, however, upon motion for
reconsideration of the respondent company, the NLRC came out with a
Resolution modifying its decision, by deleting therefrom the award of backwages,
ordering payment of separation pay in lieu of reinstatement and declaring the
loss of employment status of petitioner Joel Densing. In this present petition,
herein petitioners contended that respondent NLRC acted with grave abuse
amounting to lack or excess of jurisdiction in entertaining the second appeal of
the respondent company dated 6 April 1994 which was based on similar grounds
and reversing its earlier resolution of the first appeal promulgated on August 15,
1994 by way of another contradictory and baseless ruling promulgated on
February 21, 1995. Likewise, herein petitioners claimed that Mirafuentes,
Patentes and Tejana were deprived of their right to reinstatement and
backwages while petitioner Joel Densing was deprived of his right to
reinstatement or separation pay with backwages.
The Supreme Court found the petition partially meritorious. The Court ruled
that the strike staged by the petitioner union was illegal because the strikers
committed illegal acts in the course of the strike and violated the temporary
restraining order enjoining the union from obstructing the company premises.
However, the Court was not convinced that the quantum of proof on record
hurdled the substantiality of evidence test to support a decision that the
petitioners committed illegal acts during the strikes. In the present case, the
uncorroborated testimony of the respondent's witness does not suffice to support
a declaration of loss of employment status of petitioner Joel Densing. Thus, the
NLRC gravely abused its discretion in declaring the loss of employment status of
Joel Densing. As regards the other petitioners, the Court found their
reinstatement and payment of salaries warranted. In view thereof, the Court set
aside the assailed decision of the NLRC and reinstated the decision of the Labor
Arbiter, with the modification that the individual petitioners be paid full backwages
from October 15, 1993 until full payment of their separation pay.

SYLLABUS

1. LABOR AND SOCIAL LEGISLATION; LABOR CODE; STRIKES AND

LOCKOUTS; UNION-RECOGNITION-STRIKE; DEFINED HEREOF. — The
court is not persuaded by petitioners' allegation of union busting. The NLRC
correctly ruled that the strike staged by petitioners was in the nature of a union-
recognition-strike. A union-recognition-strike, as its legal designation implies, is
calculated to compel the employer to recognize one's union, and not the other
contending group, as the employees' bargaining representative to work out a
collective bargaining agreement despite the striking union's doubtful majority
status to merit voluntary recognition and lack of formal certification as the
exclusive representative in the bargaining unit. cdasia

2. ID.; ID.; ID.; PETITION FOR CERTIFICATION ELECTION ON MOTION

FOR INTERVENTION MAY BE ENTERTAINED ONLY WITHIN SIXTY (60)
DAYS PRIOR TO THE EXPIRY DATE OF SAID AGREEMENT; CASE AT BAR.
— It is undisputed that at the time the petition for certification election was filed
by AIUP, the petitioner union, there was an existing CBA between the
respondent company and CCEA, the incumbent bargaining representative of all
rank and file employees. The petition should have not been entertained because
of the contract bar rule. When a collective bargaining agreement has been duly
registered in accordance with Article 231 of the Labor Code, a petition for
certification election or motion for intervention may be entertained only within
sixty (60) days prior to the expiry date of the said agreement. Outside the said
period, as in the present case, the petition for certification election or motion for
intervention cannot be allowed. Hence, the conclusion that the respondent
company did not commit the alleged union busting.
 3. ID.; ID.; ID.; STRIKE; LIMITATIONS THEREOF. — A strike is a
legitimate weapon in the universal struggle for existence. It is considered as the
most effective weapon in protecting the rights of the employees to improve the
terms and conditions of their employment. But to be valid, a strike must be
pursued within legal bounds. The right to strike as a means for the attainment of
social justice is never meant to oppress or destroy the employer. The law
provides limits for its exercise. Among such limits are the prohibited activities
under Article 264 of the Labor Code, particularly paragraph (e), which states that
no person engaged in picketing shall: a) commit any act of violence, coercion, or
intimidation or b) obstruct the free ingress to or egress from the employer's
premises for lawful purposes or c) obstruct public thoroughfares.
4. ID.; ID.; ID.; ID.; EVEN IF THE STRIKE IS VALID BECAUSE ITS
OBJECTIVE IS LAWFUL, THE STRIKE MAY STILL BE DECLARED INVALID
WHERE THE MEANS EMPLOYED ARE ILLEGAL; CASE AT BAR. — Even if
the strike is valid because its objective or purpose is lawful, the strike may still be
declared invalid where the means employed are illegal. For instance, the strike
was considered illegal as the "strikers formed a human cordon along the side of
the Sta. Ana wharf and blocked all the ways and approaches to the launches and
vessels of Petitioners."
5. ID.; ID.; ID.; BACKWAGES; EMPLOYEES ARE ENTITLED FULL
BACKWAGES WITHOUT DEDUCTIONS; CASE AT BAR. — The unmeritorious
appeal interposed by the respondent company, let alone the failure to execute
with dispatch the award of reinstatement delayed the payroll reinstatement of
petitioners. But their long waiting is not completely in vain, for the court holds that
their (petitioners') salaries and backwages must be computed from October 15,
1993 until full payment of their separation pay, without any deduction. This is in
consonance with the ruling in the case of Bustamante vs. NLRC, where payment
of full backwages without deductions was ordered. The four petitions herein are
entitled to reinstatement absent any just ground for their dismissal. Considering
however, that more than eight (8) years have passed since subject strike was
staged, an award of separation pay equivalent to one (1) month pay for every
year of service, in lieu of reinstatement, is deemed more practical and
appropriate to all the parties concerned. HEAcDC

DECISION

PURISIMA, J : p

The Petition for review on Certiorari at bar seeks to reinstate the

Decision 1 of the Labor Arbiter insofar as it ordered the reinstatement and
payment of backwages of the four petitioners herein. The said decision was
affirmed 2 in toto by the NLRC. On February 21, 1995, however, upon motion for
reconsideration of the respondent company, the NLRC came out with a
Resolution 3 modifying its decision, by deleting therefrom the award of
backwages, ordering payment of separation pay in lieu of reinstatement, and
declaring the loss of employment status of petitioner Joel Densing.
The antecedent facts are as follows:
Joel Densing, Henedino Mirafuentes, Christopher Patentes, and Andres
Tejana, the petitioners herein, were casual employees of respondent CENAPRO
Chemicals Corporation. In the said company, the collective bargaining
representative of all rank and file employees was CENAPRO Employees
Association (CCEA), with which respondent company had a collective bargaining
agreement (CBA). Their CBA excluded casual employees from membership in
the incumbent union. The casual employees who have rendered at least one to
six years of service sought regularization of their employment. When their
demand was denied, they formed themselves into an organization and affiliated
with the Association of Independent unions in the Philippines (AIUP). Thereafter,
AIUP filed a petition for certification election, which petition was opposed by the
respondent company. The CCEA anchored its opposition on the contract bar
rule.
On May 4 and July 3, 1990, the union filed a notice of strike, minutes of
strike vote, and the needed documentation, with the Department of Labor and
Employment. The notice of strike cited as grounds therefor the acts of
respondent company constituting unfair labor practice, more specifically coercion
of employees and systematic union busting.
On July 23, 1992, the union proceeded to stage a strike, in the course of
which, the union perpetrated illegal acts. The strikers padlocked the gate of the
company. The areas fronting the gate of the company were barricaded and
blocked by union strikers. The strikers also prevented and coerced other non-
striking employees from reporting for work. Because of such illegal activities, the
respondent company filed a petition for injunction with the NLRC, which granted
a Temporary Restraining Order (TRO), enjoining the strikers from doing further
acts of violence, coercion, or intimidation and from blocking free ingress and
egress to the company premises. prLL

Subsequently, or on July 25, 1990, to be precise, the respondent company

filed a complaint for illegal strike. The day before, July 24, 1990, petitioners filed
a complaint for unfair labor practice and illegal lockout against the respondent
company.
In a consolidated Decision, dated September 10, 1993, the Labor Arbiter
declared as illegal the strike staged by the petitioners, and dismissed the charge
of illegal lockout and unfair labor practice. The dispositive portion of the Labor
Arbiter's decision was to the following effect:
"WHEREFORE, premises considered, judgment is hereby
rendered finding the strike illegal and as a consequence thereto, the
officers who participated in the illegal strike namely: Oscar Enicio, Jaime
dela Piedra, Lino Isidro, Ariel Jorda, and Jose Catnubay are declared to
have lost their employment status. CENAPRO is directed however to
reinstate the other workers, except Ireneo Sagaral, Artemio Guinto,
Ruben Tulod, Marcelo M. Matura, Gilbert Holdilla, Cesar Buntol, Rey
Siarot, Lucio Nuneza, Jose Basco, Gervacio Baldespinosa, Jr.,
Cresecente Buntol, Dennis Pepito, Florencio Pepito, Edwin Ramayrat,
Daniel Canete, and Vivencio Sinadjan who executed quitclaims in favor
of CENAPRO and cenapro is being absolved from the charges of illegal
lockout and unfair labor practice.
SO ORDERED." 4
In short, five ( 5 ) union officers were declared to have lost their
employment status, fifteen (15) union members were not reinstated because they
executed quit claims in favor of the respondent company, and six (6) workers,
Rosalito Bantulan, Edward Regner, Joel Densing, Henedino Mirafuentes,
Christopher Patentes, and Andres Tejana, were ordered to be reinstated. LexLib

On October 8, 1993, the Labor Arbiter issued an Order excluding Rosalito

Bantulan and Edward Regner from the list of those to be reinstated and to be
paid backwages. The remaining four (4) workers, Joel Densing, Henedino
Mirafuentes, Christopher Patentes, and Andres Tejana, are the petitioners here.
On October 5, 1993, the respondent company appealed the aforesaid
decision insofar as it ordered the reinstatement of some of the strikers.
On October 7, 1993, the petitioners also appealed the same decision of
the Labor Arbiter.
Pending resolution of the said appeals, petitioner AUIP filed with the Labor
Arbiter a Motion for Execution of the Labor Arbiter's Decision directing
reinstatement of some of its members. The motion was granted in the Order
dated October 15, 1993.
On December 7, 1993, respondent company presented a
Manifestation/Motion praying that instead of reinstatement, it be allowed to pay
separation pay to petitioners.
On December 16, 1993, petitioners presented a motion for payroll
reinstatement, which motion was opposed by the respondent company, alleging
mainly that the circumstances of the case have strained the relationship of the
parties herein, rendering their reinstatement unwise and inappropriate. But such
opposition was overruled by the Labor Arbiter. In his Order of March 23, 1994,
the same Labor Arbiter issued a second writ of execution directing actual, if not
payroll reinstatement of the strikers.
On April 6, 1994, respondent company appealed the second order for the
reinstatement of the strikers, placing reliance on the same grounds raised in
support of its first appeal.
LLjur

In its Decision dated August 15, 1994, the NLRC affirmed in toto the Labor
Arbiter's decision, dismissed both the appeal of private respondent and that of
petitioners, and reiterated the Labor Arbiter's Order for the reinstatement of the
herein petitioners, Joel Densing, Henedino Mirafuentes, Christopher Patentes,
and Andres Tejana. The said decision disposed and directed as follows:
"WHEREFORE, premises considered, these appeals are
DISMISSED, and the decision of the Labor Arbiter is AFFIRMED in its
entirety.
Appellant Cenapro Chemical Corporation is hereby ordered to
immediately comply with the Labor Arbiter's Order dated March 23, 1994
and to release the salaries of four (4) appellant-workers namely Joel
Densing, Henedino Mirafuentes, Christopher Patentes, and Andres
Tejana from October 15, 1993 and continue paying them up to the time
this decision has become final and executory, less earnings earned
elsewhere.
SO ORDERED." 5
Respondent company moved for reconsideration of that portion of the
NLRC's decision ordering the reinstatement of the said strikers. Acting
thereupon, the NLRC modified its Decision of August 15, 1994, by ordering the
payment of separation pay in lieu of the reinstatement of the petitioners, deleting
the award of backwages, and declaring the loss of employment status of Joel
Densing. The dispositive portion of the said Amendatory Resolution, ruled thus:
"WHEREFORE, the decision of the Commission promulgated on
August 15, 1994 is hereby MODIFIED. In view of reinstatement to
complainants Henedino Mirafuentes, Christopher Patentes, and Andres
Tejana, appellant-movant CENAPRO Chemicals Corporation is directed
to pay them the amount equivalent to one (1) month pay for every year
of service and without backwages. As regards Joel Densing, he is
declared to have lost his employment status.
SO ORDERED." 6
Hence, the present petition, theorizing that respondent NLRC acted with
grave abuse of discretion amounting to lack or excess of jurisdiction in:cda
 1) Entertaining the second appeal of the respondent company dated 6
April 1994 (the first appeal dated 5 October 1993) which was based on similar
grounds.
2) Reversing its earlier Resolution of the first appeal promulgated 15
August 1994 by way of another contradictory and baseless ruling promulgated on
21 February 1995.
3) Depriving Henedino Mirafuentes, Christopher Patentes, and Andres
Tejana of their right to reinstatement and backwages; and
4) Depriving Joel Densing of his right to reinstatement or separation pay
with backwages.
It is decisively clear that although the grounds invoked in the two appeals
were the same, the said appeals were separate and distinct remedies. Filed on
October 5, 1993, the first appeal was from the decision of Labor Arbiter Nicasio
Aninon, dated September 10, 1993, seeking loss of employment status of all the
union members who participated in the illegal strike. The second appeal, dated
April 6, 1994, was, in effect, an opposition to the second writ of execution issued
on March 23, 1994. The second writ pertained to the order to effect immediate
actual or payroll reinstatement of the four petitioners herein. The said appeals
were acted upon separately by the NLRC, which did not act with grave abuse of
discretion in entertaining such appeals.
When they filed the notice of strike, petitioners cited as their grounds
therefor unfair labor practice, specifically coercion of employees and systematic
union busting. But the said grounds were adjudged as baseless by the Labor
Arbiter. The court quotes with approval the following findings of Labor Arbiter
Aninon, to wit:cdll

". . . In fact, in the undated Joint Affidavit of Oscar Enecio,

Edgardo Regner, Christopher Patentes, Edgar Sanchez, Ariel Jorda, and
Jaime dela Piedra, the workers stated that what they considered as
harassments and insults are those when they were scolded for little
mistakes and memoranda for tardiness. These acts, if really committed
cannot be considered as harassment and insults but were ordinary acts
which employers have to do as part of their administrative supervision
over their employees. Moreover, Oscar Enecio's testimony that some of
his fellow union members like vice-president Jaime dela Piedra,
Christopher Potentes and Herodino Mirafuentes, were also harass when
they were made to work another eight (8) hours after their tour of duty
deserves scant consideration not only because it is uncorroborated but
he could not even give the dates when these workers were made to
work for sixteen (16) hours, how many instances these happened and
whether or not the workers have actually worked." 7
 The court discerns no basis for altering the aforesaid findings which have
been affirmed by the NLRC.
The court is not persuaded by petitioners' allegation of union busting. The
NLRC correctly ruled that the strike staged by petitioners was in the nature of a
union-recognition-strike. A union-recognition-strike, as its legal designation
implies, is calculated to compel the employer to recognize one's union, and not
the other contending group, as the employees' bargaining representative to work
out a collective bargaining agreement despite the striking union's doubtful
majority status to merit voluntary recognition and lack of formal certification as
the exclusive representative in the bargaining unit. It is undisputed that at the
time the petition for certification election was filed by AIUP, the petitioner union,
there was an existing CBA between the respondent company and CCEA, the
incumbent bargaining representative of all rank and file employees. The petition
should have not been entertained because of the contract bar rule. When a
collective bargaining agreement has been duly registered in accordance
with Article 231 of the Labor Code, a petition for certification election or motion
for intervention may be entertained only within sixty (60) days prior to the expiry
date of the said agreement. 8 Outside the said period, as in the present case, the
petition for certification election or motion for intervention cannot be allowed.
Hence, the conclusion that the respondent company did not commit the alleged
union busting.
From the gamut of evidence on hand, it can be gathered that the strike
staged by the petitioner union was illegal for the reasons, that:
1) The strikers committed illegal acts in the course of the strike. They
formed human barricades to block the road, prevented the passage of the
respondent company's truck, padlocked the company's gate, and prevented co-
workers from entering the company premises. 9
2) And violated the Temporary Restraining Order (TRO) 10 enjoining the
union and/or its members from obstructing the company premises, and ordering
the removal therefrom of all the barricades. cdasia

A strike is a legitimate weapon in the universal struggle for existence. 11 It

is considered as the most effective weapon in protecting the rights of the
employees to improve the terms and conditions of their employment. 12 But to be
valid, a strike must be pursued within legal bounds. The right to strike as a
means for the attainment of social justice is never meant to oppress or destroy
the employer. The law provides limits for its exercise. Among such limits are the
prohibited activities under Article 264 of the Labor Code, particularly paragraph
(e), which states that no person engaged in picketing shall:
a) commit any act of violence, coercion, or intimidation or
 b) obstruct the free ingress to or egress from the employer's premises for
lawful purposes or
c) obstruct public thoroughfares.
Even if the strike is valid because its objective or purpose is lawful, the
strike may still be declared invalid where the means employed are illegal. For
instance, the strike was considered illegal as the "strikers formed a human
cordon along the side of the Sta. Ana wharf and blocked all the ways and
approaches to the launches and vessels of Petitioners". 13
It follows therefore that the dismissal of the officers of the striking union
was justified and valid. Their dismissal as a consequence of the illegality of the
strike staged by them finds support in Article 264(a) of the Labor Code, pertinent
portion of which provides: ". . . Any union officer who knowingly participates in an
illegal strike and any . . . union officer who knowingly participates in the
commission of illegal acts during a strike may be declared to have lost his
employment status. . . ."
Union officers are duty bound to guide their members to respect the law. If
instead of doing so, the officers urge the members to violate the law and defy the
duly constituted authorities, their dismissal from the service is a just penalty or
sanction for their unlawful acts. The officers' responsibility is greater than that of
the members. 14 cdtai

The court finds merit in the finding by the Labor Arbiter and the NLRC that
the respondent company committed no illegal lockout. Lockout means temporary
refusal of the employer to furnish work as a result of an industrial or labor
dispute.15
As observed by the Labor Arbiter, it was the appellant-workers who
voluntarily stopped working because of their strike. In fact, the appellant workers
admitted that non-striking workers who wanted to return to work were allowed to
do so. Their being without work could not therefore be attributed to the
employer's refusal to give them work but rather, to the voluntary withdrawal of
their services in order to compel the company to recognize their union. 16
The next aspect of the case to consider is the fate of the four petitioners
herein. Decisive on the matter is the pertinent provision of Article 264(a) of the
Labor Code that: ". . . any worker . . . who knowingly participates in the
commission of illegal acts during a strike may be declared to have lost his
employment status. . . ." It can be gleaned unerringly from the aforecited
provision of law in point, however, that an ordinary striking employee can not be
terminated for mere participation in an illegal strike. There must be proof that he
committed illegal acts during the strike 17 and the striker who participated in the
commission of illegal act must be identified. But proof beyond reasonable doubt
is not required. Substantial evidence available under the attendant
circumstances, which may justify the imposition of the penalty of dismissal, may
suffice.
In the landmark case of Ang Tibay vs. CIR, 18 the court ruled "Not only
must there be some evidence to support a finding or conclusion, but the evidence
must be "substantial". Substantial evidence is more than a mere scintilla. It
means such relevant evidence that a reasonable mind might accept as sufficient
to support a conclusion."
Respondent company contends that sufficient testimonial, documentary
and real evidence, including the photographs supposedly taken by a certain Mr.
Ponce, were presented at the arbitration level. It is argued that the said pictures
best show the participation of the strikers in the commission of illegal acts in the
course of the strike. In connection therewith, it is worthy to point out the sole
basis of the NLRC for declaring the loss of employment status of petitioner Joel
Densing, to wit: cdrep

"ATTY. PINTOR:
Q: Now, Mr. Ponce, on page 1 of your affidavit, paragraph 4 thereof, you
alleged that: "While in the gate, I saw several strikers of Cenapro
blocked its gate and prevented the truck from proceeding to its
destination." Who were these several workers you referred to, in
this affidavit of yours?
WITNESS:
A. The strikers.
HON. LABOR ARBITER:
Q. Are you referring to the complainants in this case who are now
present?
WITNESS:
A. Yes sir, I am referring to AIU members.
HON. LABOR ARBITER:
Make it of record that the witness is referring to the five persons
inside the court namely: Rosalito Bentulan, Ariel Jorda, Ranulfo
Cabrestante, Jose Catnubay and Joel Densing." 19 (emphasis
supplied)
All things studiedly considered, the court is not convinced that the quantum
of proof on record hurdled the substantiality of evidence test 20 to support a
decision, a basic requirement in administrative adjudication. If the said pictures
exhibited before the Labor Arbiter portrayed the herein petitioners performing
prohibited acts during the strike, why were these pictures not exhibited for
identification of petitioners? Petitioners could have been identified in such
pictures, if they were reflected therein, in the same manner that the lawyer who
examined Mr. Ponce, asked witness Armamento to identify the Sheriff, Mr.
Leahmon Tolo, thus:
"ATTY. PINTOR:
Q I refer your attention Mr. Armamento to Exhibit "16". There is a person
here wearing a short sleeve barong tagalog. Can you please tell
the Honorable office if you will be able to identify this person?
WITNESS:
A Yes, this is the Sheriff, Mr. Leahmon Tolo." 21
The identification of the alleged pictures of the strikers, if properly made,
could have been categorized as substantial evidence, which a reasonable mind
may accept as adequate to support a conclusion that Joel Densing participated in
blocking the gate of respondent company. prcd

Verily, the uncorroborated testimony of Mr. Ponce does not suffice to

support a declaration of loss of employment status of Joel Densing. This could be
the reason why the Labor Arbiter and the NLRC, in its decision dated August 15,
1994, upheld the reinstatement of Joel Densing.
The contention of petitioners that the factual findings by the Labor Arbiter,
as trial officer in the case, deserve much weight is tenable. The NLRC is bound
by the factual findings of the Labor Arbiter as the latter was in a better position to
observe the demeanor and deportment of the witnesses. "Absent any substantial
proof that the trial court's decision was based on speculation, the same must be
accorded full consideration and should not be disturbed on appeal." 22
Premises studiedly considered, we are of the ineluctable conclusion, and
hold, that the NLRC gravely abused its discretion in declaring the loss of
employment status of Joel Densing.
As regards the other petitioners, Henedino Mirafuentes, Christopher
Patentes, and Andres Tejana, their reinstatement is warranted. In its resolution,
the NLRC adjudged petitioners as "not entirely faultless" in light of the following
revelation of Mr. Ponce, to wit:
"ATTY. PINTOR:
Q. Mr. Ponce, I will refer you to a picture previously marked as our
Annex "H". Showing to you the said picture. In said picture, there
are persons who are lying on the road. Can you please identify
who are these persons?
WITNESS:
 A. They are the strikers.
ATTY. PINTOR:
Q. Are you referring to the AIU strikers the complainants in this case?
WITNESS:
A. Yes, Sir." 23
For the severest administrative penalty of dismissal to attach, the erring
strikers must be duly identified. Simply referring to them as "strikers", "AIU
strikers" complainants in this case" is not enough to justify their dismissal. llcd

On the issue of reinstatement and payment of salaries, the court also find
for petitioners. Telling on the monetary award is Article 223 of the Labor Code,
the pertinent of which reads:
". . . In any event, the decision of the labor arbiter reinstating a
dismissed employee shall be immediately executory, even pending
appeal. The employee shall either be admitted back to work under the
same terms and conditions prevailing prior to his dismissal or separation
or, at the option of the employer, merely reinstated in the payroll. The
posting of bond shall not stay the execution of the reinstatement
provided therein. . . ."
The NLRC Resolution of February 21, 1995 does not state any plausible
ground or basis for deleting the award for backwages. The mere fact that the
petitioners were "not entirely faultless" is of no moment. Such finding below does
not adversely affect their entitlement to backwages. As opined by the NLRC in its
Decision of August 15, 1994, affirming in its entirety the conclusion arrived at by
the Labor Arbiter "the only option left to the appellant-company is whether to
physically reinstate appellant workers or to reinstate them on the payroll."
The unmeritorious appeal interposed by the respondent company, let
alone the failure to execute with dispatch the award of reinstatement delayed the
payroll reinstatement of petitioners. But their long waiting is not completely in
vain, for the court holds that their (petitioners') salaries and backwages must be
computed from October 15, 1993 until full payment of their separation pay,
without any deduction. This is in consonance with the ruling in the case
of Bustamante vs. NLRC, 24where payment of full backwages without deductions
was ordered. The four petitioners herein are entitled to reinstatement absent any
just ground for their dismissal. Considering, however, that more than eight (8)
years have passed since subject strike was staged, an award of separation pay
equivalent to one (1) month pay for every year of service, in lieu of reinstatement,
is deemed more practical and appropriate to all the parties concerned. prLL

WHEREFORE, the petition is GRANTED; the Resolution of NLRC, dated

February 21, 1995, is SET ASIDE, and the Decision of the Labor Arbiter of
October 8, 1993 REINSTATED, with the modification that the petitioners, Joel
Densing, Henedino Mirafuentes, Christopher Patentes, and Andres Tejana, be
paid full backwages computed from October 15, 1993 until full payment of their
separation pay. The payment of separation pay in lieu of reinstatement, is hereby
authorized. No pronouncement as to costs.
SO ORDERED.
(Association of Independent Unions in the Phil. v. National Labor Relations
|||

Commission, G.R. No. 120505, [March 25, 1999], 364 PHIL 697-713)

[G.R. No. 153664. July 18, 2003.]

GRAND BOULEVARD HOTEL (formerly known as SILAHIS

INTERNATIONAL HOTEL, INC.), petitioner, vs. GENUINE
LABOR ORGANIZATION OF WORKERS IN HOTEL,
RESTAURANT AND ALLIED INDUSTRIES
(GLOWHRAIN), respondent.

[G.R. No. 153665. July 18, 2003.]

GRAND BOULEVARD HOTEL (formerly known as SILAHIS

INTERNATIONAL HOTEL, INC.), petitioner, vs. EDNA B.
DACANAY, respondent.

Soo Gutierrez Leogardo and Lee for petitioner.

Potenciano A. Flores, Jr. for private respondent.
Adriano E. Dacanay for respondent Dacanay.

SYNOPSIS

Petitioner herein filed a complaint for illegal strike against the respondent
union and its officers and some of its members. The labor arbiter rendered a
decision in favor of petitioner and declared the respondents guilty of illegal strike
and declared the union officers to have lost and forfeited their employment. The
respondent union interposed an appeal to the NLRC. The NLRC rendered a
decision affirming the decision of the labor arbiter but urged the petitioner, on
humanitarian considerations, to pay the respondents financial assistance.
Dissatisfied, the respondent union filed a petition for certiorariafter their motion
for reconsideration was denied by the NLRC. The Court of Appeals granted the
petition and rendered a decision in favor of the respondents. The strike was
declared legal and the dismissal of the union officers was declared without legal
basis, hence, the case was remanded to the labor arbiter for computation of
backwages and separation pay. Hence this petition where the petitioner assailed
the decision and resolution of the CA.
According to the Supreme Court, a strike that is undertaken despite the
issuance by the Secretary of Labor and Employment (SOLE) of an assumption or
certification order, becomes a prohibited activity and, thus, illegal pursuant to
Article 264 of the Labor Code, as amended. In this case, the labor union filed its
notice of strike with the Department of Labor and Employment and on the same
day staged a picket on the hotel premises, in violation of the law. The
respondents cannot argue that since the notice of strike was for the same
grounds as those contained in their previous strike that complied with the
requirements of the law; the later strike was also lawful. The SOLE had already
taken the matters contained in their previous notice of strike when it issued
a status quo ante bellum order enjoining the respondent union from intending or
staging a strike. Despite the SOLE order, the respondent union staged a strike in
violation of the law. The Supreme Court reversed and set aside the decision of
the Court of Appeals and the decision of the labor arbiter was reinstated. Petition
was granted. CAaSHI

SYLLABUS

1. REMEDIAL LAW; CIVIL PROCEDURE; APPEAL FROM COURT OF

APPEALS TO SUPREME COURT; PETITIONER IS NOT REQUIRED TO
APPEND COPIES OF ALL PLEADINGS AND DECISIONS FILED BY THE
PARTIES; APPLICATION IN CASE AT BAR. — Barren of merit is the
respondents' contention that the petition at bar should be denied due course for
failure of the petitioner to append to its petition copies of pleadings, such as
petitions, complaint, answer, resolutions, orders, and decisions filed with the
Labor Arbiter, the NLRC and the CA as required by Section 4, Rule 45 of the
Revised Rules of Court. What the rule merely requires is for the petition to be
accompanied by a clearly legible and duplicate original or a certified true copy of
the judgment or final order or resolution of the court a quo and the requisite
number of plain copies thereof and such material portions of the record as would
support the petition. The said rule does not require the petitioner to append
copies of all pleadings and decisions filed by the parties with the Labor Arbiter,
the NLRC and the CA. After all, under Section 7 of the Rule, the Court may
require the parties to file pleadings or other documents as the Court deems
necessary, and if the petition is given due course, the Court may require the
elevation of a complete record of the case as provided for under Section 8 of the
Rule.
2. LABOR AND SOCIAL LEGISLATION; LABOR CODE; LABOR
RELATIONS; LAWFUL STRIKES; PROCEDURAL REQUIREMENTS. — Under
the aforequoted provisions, the requisites for a valid strike are as follows: (a) a
notice of strike filed with the DOLE thirty days before the intended date thereof or
fifteen days in case of ULP; (b) strike vote approved by a majority of the total
union membership in the bargaining unit concerned obtained by secret ballot in a
meeting called for that purpose; (c) notice given to the DOLE of the results of the
voting at least seven days before the intended strike. The requisite seven-day
period is intended to give the DOLE an opportunity to verify whether the
projected strike really carries the approval of the majority of the union members.
The notice of strike and the cooling-off period were intended to provide an
opportunity for mediation and conciliation. The requirements are mandatory and
failure of a union to comply therewith renders the strike illegal. A strike
simultaneously with or immediately after a notice of strike will render the requisite
periods nugatory. aEcSIH

3. ID.; ID.; ID.; ID.; ID.; CANNOT BE DISPENSED WITH BY CLAIMING

GOOD FAITH; RATIONALE. — The respondents' claim of good faith is not a
valid excuse to dispense with the procedural steps for a lawful strike. As this
Court held in National Federation of Labor v. NLRC: Arguing that despite its
failure to comply with the statutory requirements necessary for a valid strike, NFL
asserts that the same can be declared legal for it was done in good faith, citing
the cases of People's Industrial and Commercial Employees and Workers
Organization (FFW) v. People's Industrial and Commercial Corp. and Philippine
Metal Foundries, Inc. v. Court of Industrial Relations. The reliance is
misplaced. People's Industrial did not rule that the procedural steps can be
dispensed with even if the union believed in good faith that the company was
committing an unfair labor practice. While, it is true that Philippine Metal held that
a strike cannot be declared as illegal for lack of notice, however, it is important to
note that said case was decided in 1979. At this juncture, it must be stressed that
with the enactment ofRepublic Act No. 6715 which took effect on March 21,
1989, the rule now is that such requirements as the filing of a notice of strike,
strike vote, and notice given to the Department of Labor are mandatory in nature.
Thus, even if the union acted in good faith in the belief that the company was
committing an unfair labor practice, if no notice of strike and a strike vote were
conducted, the said strike is illegal. In Lapanday Workers Union v. NLRC, we
held that a strike is the most preeminent of the economic weapons of workers
which they unsheathe to force management to agree to an equitable sharing of
the joint product of labor and capital. But we also emphasized that strikes exert
some disquieting effects not only on the relationship between labor and
management, but also on the general peace and progress of society, not to
mention the economic well-being of the State. It is a weapon that can either
breathe life to or destroy the union and members in their struggle with
management for a more equitable due of their labors. Hence, the decision to
wield the weapon of strike must therefore rest on a rational basis, free from
emotionalism, unswayed by the tempers and tantrums of a few hotheads, and
firmly focused on the legitimate interest of the union which should not however
be antithetical to the public welfare. In every strike staged by a union, the general
peace and progress of society and public welfare are involved. cEaDTA

4. ID.; ID.; ID.; ID.; STRIKE UNDERTAKEN DESPITE THE ISSUANCE BY

THE SOLE OF AN ASSUMPTION OR CERTIFICATION ORDER BECOMES A
PROHIBITED ACTIVITY PURSUANT TO ARTICLE 284 OF THE LABOR
CODE OF THE PHILIPPINES. — Moreover, a strike that is undertaken, despite
the issuance by the SOLE of an assumption or certification order, becomes a
prohibited activity and, thus, illegal pursuant to Article 264 of the Labor Code of
the Philippines, as amended. As this Court ruled in Union of Filipro Employees v.
Nestle Philippines, Inc., under Article 264(a) of the said code, once an
assumption certification order is issued by the SOLE, strikes are enjoined or if
one has already taken place, all strikers shall immediately return to work: We
also wish to point out that an assumption and/or certification order of the
Secretary of Labor automatically results in a return-to-work of all striking workers,
whether or not a corresponding order has been issued by the Secretary of Labor.
Thus, the striking workers erred when they continued with their strike alleging
absence of a return-to-work order. Article 264(g) (sic) is clear. Once an
assumption/certification order is issued, strikes are enjoined, or if one has
already taken place, all strikers shall immediately return to work. A strike that is
undertaken despite the issuance by the Secretary of Labor of an assumption or
certification order becomes a prohibited activity and thus illegal, pursuant to the
second paragraph of Art. 264 of the Labor Code as amended (Zamboanga Wood
Products, Inc. v. NLRC, G.R. 82088, October 13, 1989; 178 SCRA 482). The
Union officers and members, as a result, are deemed to have lost their
employment status for having knowingly participated in an illegal act. In this case,
the respondent union filed its notice of strike with the DOLE on November 16,
1990 and on the same day, staged a picket on the premises of the hotel, in
violation of the law. Police operatives of the Western Police District had to
disperse the picketers and take into custody Union President Rogelio Soluta and
the other officers of respondent union, Henry Babay and Dennis Cosico. The
respondents cannot argue that since the notice of strike on November 16, 1990
were for the same grounds as those contained in their notice of strike on
September 27, 1990 which complied with the requirements of the law on the
cooling-off period, strike ban, strike vote and strike vote report, the strike staged
by them on November 16, 1990 was lawful. The matters contained in the notice
of strike of September 27, 1990 had already been taken cognizance of by the
SOLE when he issued on October 31, 1990 a status quo ante bellum order
enjoining the respondent union from intending or staging a strike. Despite the
SOLE order, the respondent union nevertheless staged a strike on November 16,
1990 simultaneously with its notice of strike, thus violating Article 264(a) of
the Labor Code of the Philippines, as amended, which reads: Art. 264. . . . No
strike or lockout shall be declared after assumption of jurisdiction by the
President or the Secretary or after certification or submission of the dispute to
compulsory or voluntary arbitration or during the pendency of cases involving the
same grounds for the strike or lockout.

DECISION

CALLEJO, SR., J : p

Before us is a petition for review on certiorari of the Decision 1 of the Court

of Appeals in CA-G.R. SP Nos. 53284 & 53285 dated January 9, 2002 and its
Resolution 2 dated May 27, 2002 denying the petitioner's motion for
reconsideration of the said decision.
The Antecedents
On February 27, 1987, Genuine Labor Organization of Workers in Hotel,
Restaurant and Allied Industries — Silahis International Hotel Chapter
(GLOWHRAIN-Silahis) (respondent union for brevity) and the petitioner Grand
Boulevard Hotel (then Silahis International Hotel, Inc.) executed a Collective
Bargaining Agreement (CBA) covering the period from July 10, 1985 up to July 9,
1988. The petitioner thereafter dismissed some of its employees and suspended
others who were members of the respondent union. On May 26, 1987, the
respondent union filed a notice of strike with the Department of Labor and
Employment, National Capital Region (DOLE-NCR), based on the following
grounds:
a) Illegal dismissal
b) Illegal suspension
c) CBA violations
d) Harassments 3
On June 4, 1987, the then Acting Secretary of Labor and Employment
(SOLE for brevity) issued a status quo ante bellumorder certifying the labor
dispute to the National Labor Relations Commission (NLRC) for compulsory
arbitration pursuant toArticle 263(g) of the Labor Code; and further directing the
employees to return to work within forty-eight hours from receipt of the
order, 4 and for the petitioner to accept all returning employees under the same
terms and conditions prevailing prior to the labor dispute. The respondent union
complied with the order of the SOLE. On May 9, 1990, the respondent union filed
another notice of strike against the petitioner on account of alleged violations of
the CBA and the illegal dismissal of nine employees. The matter was docketed
as NCMB-NCR Case No. 06-400-90. On May 23, 1990, the SOLE issued
another status quo ante bellum order certifying the case to the NLRC for
compulsory arbitration, directing the nine employees to return to work and
enjoining both parties from engaging in any strike or lockout that would
exacerbate the situation. The parties were also directed to sign a CBA within
fifteen days from notice of the said order. 5
On June 15, 1990, the petitioner and the respondent union entered into
and signed a third CBA covering the period of July 10, 1988 to July 9, 1991. On
August 22, 1990, Union President Rogelio Soluta wrote the petitioner, calling its
attention to and protesting the following violations of the CBA:
1. Union dues and other assessments deducted from CBU and
union members' salary for July 15, 1990 payday.
2. Union dues and other assessments deducted from CBU and
union member's salary for July 31, 1990 payday.
3. Union dues and other assessments deducted from CBU and
union members' salary for August 15, 1990 payday. 6
On September 6, 1990, the petitioner placed the respondent union's
Director for Grievances Apolonio Bondoc, Jr. under preventive suspension. On
September 13, 1990, the respondent union filed a manifestation and motion in
NCMB-NCR-NS Case No. 06-400-90 praying that the petitioner be held in
contempt for violating the May 23, 1990 Order of the SOLE. On September 22,
1990, the petitioner suspended Francisco Pineda, a union counselor.
On September 27, 1990, the respondent union filed a notice of strike
based on the following grounds:
a. Violation of CBA;
b. Coercion of employees;
c. Harassment;
d. Arbitrary transfer of employees; and
e. Illegal termination and suspension of employees 7

The matter was docketed as NCMB-NCR-NS-09-807-90. On October 10,

1990, the respondent union moved that the SOLE reconsider the May 23,
1990 Return-to-Work Order.
 On October 16, 1990, Michael Wilson, the petitioner's general manager,
wrote the SOLE informing him of the petitioner's decision to retrench seventeen
less senior employees on a staggered basis, spread over a period of sixty days,
to lessen the daily financial losses being incurred by the petitioner. A portion of
the letter reads:
Due to the present continued downturn in tourism, we at the
Silahis International Hotel are about to undertake a retrenchment
program. As you know the other hotels have also invoked this
management prerogative in order to lessen their financial losses incurred
these last few months.
Due to our unique situation/relationship with the KMU, I am writing
to you and appealing to your good sense of fair play on case of problems
arising from unruly elements. We plan to retrench on a staggered basis
one hundred seventy-one (171) less senior employees over a period of
sixty (60) days, in order to stem the huge losses being incurred by us
daily, during this unfortunate period.
Therefore, on behalf of my staff we ask fairness in this situation
and hope the above actions can be taken smoothly and peacefully. 8
The next day, the respondent union, through its president, informed the
DOLE-NCR that the union will conduct a strike vote referendum on October 23
and 24, 1990. The members of the respondent union voted to stage a strike. On
October 25, 1990, the respondent union informed the DOLE-NCR of the results
of the strike vote referendum. On October 31, 1990, the SOLE issued
another status quo ante bellum order certifying the case to the NLRC for
compulsory arbitration and enjoining the parties from engaging in any strike or
lockout. The decretal portion of the order reads:
WHEREFORE, ABOVE PREMISES CONSIDERED, this Office
hereby certifies the labor disputes at Silahis International Hotel, Inc., to
the National Labor Relations Commission for compulsory arbitration.
Accordingly, any strike or lockout, whether actual or intended, is hereby
enjoined.
Consequently, pending resolution of the legality of the alleged
dismissal of Apolonio Bondoc, Jr., the Company is directed to effect
payroll reinstatement and accord him free access to the union office so
that his duties as union officer will not be impaired. 9
The petitioner wrote the SOLE of its decision to implement its
retrenchment program to stem its huge losses. On November 5, 1990, the
petitioner disseminated a circular to all the employees, informing them that the
personnel plantilla would be decreased by two hundred employees to be
implemented on a staggered and "last in, first out" basis. It terminated the
employment of sixty employees and two officers of the respondent
union effective December 6, 1990. Moreover, the said employees, including the
two union officers, were immediately barred from working. On November 7, 1990,
the respondent union protested the actions of the petitioner invoking Section 15,
Article VI of the CBA. The respondent union filed an urgent motion for a
reconsideration by the SOLE of the Certification Order dated October 31, 1990.
On November 14, 1990, the petitioner terminated the employment of eighty-six
more employees effective December 14, 1990. The remaining employees were
also informed that it will close in six months. On November 14, 1990, the
petitioner terminated the employment of Kristoffer So, effective December 14,
1990.
By way of riposte, the respondent union filed on November 16, 1990
another notice of strike because of what it perceived as the petitioner's continuing
unfair labor practices (ULP). On the same day, at about 12:00 noon, the officers
of the respondent union and some members staged a picket in the premises of
the hotel, obstructing the free ingress and egress thereto. At 3:00 p.m., the police
operatives of the Western Police District arrived and dispersed the picket line.
Police officers detained the respondent union's president Rogelio Soluta, Henry
Baybay and Dennis Cosico. On November 17, 1990, the petitioner sent identical
letters to the officers and members of the respondent union terminating their
employment effective that day on the following grounds: DIAcTE

Management found that you have willingly and knowingly

participated in the illegal strike and concerted activity which was staged
against the Hotel beginning on 16 November 1990. Management also
found that you have, singly and collectively with others, committed illegal
acts in the course of the said illegal strike such as, among others,
obstructing the free ingress and egress to and from the hotel's premises.
In addition, Management has determined that you have grossly
and glaringly violated existing company rules on peace and order such
as, Rule V, and on promotion of goodwill such as Rule IV of the
Company Rules. Worse, you have violated the Company Rule against
abandonment of work under Rule VII, thus, adversely affecting the hotel
operations.
Your foregoing acts are not only serious violations of the law but
also constitute grave misconduct and blatant disregard of company
rules, any or all of which, justify your dismissal from the company.
In view of the foregoing, notice is hereby given upon you that
effective today, 17 November 1990, your employment with the company
is terminated for cause. 10
On November 28, 1990, the SOLE issued an order certifying the labor
dispute to the NLRC for consolidation with the previously certified case (Certified
Case No. NCMB-NCR-NS-09-807-90). The SOLE issued a return-to-work order,
excluding those who were retrenched, and enjoined all parties from committing
any act that would aggravate the already tense situation. The SOLE further
stated that the validity and propriety of the retrenchment program of the petitioner
should be ventilated before and resolved by the NLRC. The SOLE denied the
respondent union's motion to reconsider its October 31, 1990 Cease and Desist
Order, thus:
WHEREFORE, PREMISES CONSIDERED, and pursuant to
Article 263 (g) of the Labor Code, as amended, this Office hereby
certifies the instant labor dispute at the Company to the National Labor
Relations Commission for consolidation with Certified Case No. NCMB-
NCR-NS-09-807-90.
Accordingly, all striking employees including those who were
terminated for participation in the alleged illegal strike, but excluding
those workers affected by the retrenchment program, are directed to
return to work within twenty-four (24) hours from receipt hereof and for
the Company to accept them under the same terms and conditions of
employment prevailing prior to the work stoppage.
The validity and propriety of the Company's retrenchment
program shall be ventilated and adjudicated by the NLRC.
The directive for the parties to cease and desist from committing
any act that will aggravate the situation is hereby reiterated.
The union's Motion for Reconsideration is hereby denied.
Finally, the Superintendent of the Western Police District is
hereby deputized to assist in the orderly and peaceful implementation of
this Order. 11
In his order, the SOLE made the succinct observation that both the
petitioner and the respondent union were to blame for the current labor conflict:
. . . From the series of events that occurred from the time this
Office issued the Order on 31 October 1990 up to the declaration of the
strike, it is very apparent that several acts were committed by both
parties that caused the further deterioration of their relationship despite
this Office's admonition to desist from engaging in ay (sic) form of
lockout or strike, whether actual or intended. Likewise, it is also very
obvious that the current labor conflict is deeply rooted in an (sic)
intertwined with the earlier dispute on account of the nature of the acts
committed by both parties. Unfair labor practices, by its nature, could be
committed through series of continuing acts, and allegations of
commission of unfair labor practice acts should be ventilated in the
forum earlier tasked to resolve the dispute at the Company. 12
 The respondent officers and members complied with the order of the
SOLE and returned to work. On January 15, 1991, the SOLE issued an order for
the reinstatement of the thirty-five dismissed employees with full backwages.
On February 1, 1991, the petitioner filed a complaint 13 with the Regional
Arbitration Office of the NLRC for illegal strike against the union, its members
and officers, namely: Rogelio M. Soluta, Elmer C. Labor, Joselito A. Santos,
Florentino P. Matilla, Edna B. Dacanay, Henry N. Babay, Ray Antonio E.
Rosaura, Dennis C. Cosico, Vicente M. Delola, Irene B. Ragay, Apolonio
Bondoc, Jr., Quintos B. Barra, Alfredo S. Bautista, Richard T. Galigo, John Does
and Jane Does. The petitioner allegedinter alia that the union members and
officers staged a strike on November 16, 1990 which lasted until November 29,
1990 without complying with the requirements provided under Articles 263 and
264 of the Labor Code. The petitioner alleged inter alia that:
1. The strike staged by the respondents from 16 to 29 November 1990 is
illegal for failure of the strikers to comply with the requirements
provided for by law;
2. Individual respondents who are the union officers and respondent
John Does and Jane Does knowingly participated in the
commission of illegal acts during the strike;
3. As a consequence of the illegal strike and concerted activities by the
respondents the company suffered actual damages; and
4. Complainant Hotel was constrained to engage the services of counsel
and, therefore, should be paid attorney's fees. 14
It further alleged that the officers and members of the respondent union
blocked the main ingress to and egress from the hotel.
The petitioner prayed that, after due proceedings, judgment be rendered in
its favor declaring the strike staged by the respondent union illegal, that it be
awarded damages, and that the officers and members of the union who
participated in the strike be dismissed from their employment.
The respondents denied the material allegations of the complaint and
alleged that the petitioner committed unfair labor practices prior to the filing of the
November 16, 1990 notice of strike. Hence, there was no need for the
respondent union to comply with Articles 263 and 264 of the Labor Code, as the
notice filed by the union on September 27, 1990 was sufficient compliance with
the law. The view posited by the respondent union was summarized by its
president Rogelio M. Soluta in his affidavit:
a. after the execution of the CBA on June 15, 1990 he wrote on
August 22, 1990 the company protesting its violations [Exh. 8];
 b. on September 13, 1990 their union wrote the Secretary of
Labor and Employment praying that the company be cited in contempt
for violation of his May 23, 1990 order [Exh. 10] which enjoined the
parties from engaging in strike or lockout [Exh. 7].
c. on September 27, 1990 the union filed a notice of strike on
grounds of unfair labor practices as enumerated in par. 19 of Soluta's
affidavit, acting on which the Secretary of Labor certified the labor
dispute to the NLRC for compulsory arbitration and enjoining any strike
or lockout-again [Exh. 16]. In violation of said order, the company on
November 5, 1990 issued a circular to all employees that it will decrease
its personnel plantilla by 200 employees [Exh. 17] and on November 6,
1990 it again issued a memorandum terminating 60 employees including
2 union officers, while effective still December 6, 1990 were not allowed
to work already on November 6, 1990, to which the union on November
7, 1990 protested invoking Sec. 15, Art. VI, 2nd par. of the CBA, only to
be confirmed by the Hotel in a letter that it will undertake a retrenchment
of 200 employees [Exh. 19]. Union president Soluta sought for a
dialogue with the management but he was only insulted and rebuffed by
the Hotel when it issued a memorandum terminating 86 employees
effective December 14, 1990 [Exh. 20] and not satisfied, the Hotel's
Executive Vice-President issued a memorandum to all department
heads that the Hotel will close for a period of six months. [Exh. 21]
(Italics ours, Record, pp. 396-397) 15
The respondent union and its officers filed on October 14, 1991 a motion to
suspend the proceedings, alleging inter aliathat:
8. In the determination of the validity or legality of a strike, three
(3) essential factors are to consider:
a) The purpose or objective of the strike;
b) The means employed;
c) Compliance with the requirements of the law provided for under
Article 263 of the Labor Code of the Philippines, as amended. 16
On February 12, 1992, Labor Arbiter Cornelio L. Linsangan rendered a
decision in favor of the petitioner, the decretal portion of which reads:
WHEREFORE, finding the respondents guilty of illegal strike as
charged, judgment is hereby rendered declaring the union officers to
have lost and forfeited their employment. 17
The Labor Arbiter, although sympathetic with the respondent union, held
that for the latter's failure to comply with the requirements laid down in Articles
263 and 264 of the Labor Code, the strike that was staged on November 16,
1990 up to November 29, 1990 was illegal. Considering the admissions of the
individual respondents that they participated in the said strike, the termination of
their employment by the petitioner was legal. The Labor Arbiter noted that if as
alleged by the respondent union the petitioner was guilty of ULP, it should have
filed a complaint therefor against the petitioner and/or its officials for which the
latter could have been meted penal and administrative sanctions as provided for
in Article 272 of theLabor Code. The respondent union failed to do so.
When the petitioner learned of the decision of the Labor Arbiter on
February 14, 1992, it forthwith barred the officers and members of the
respondent union from entering the hotel. On February 22, 1992, the SOLE
ordered the petitioner to accept the dismissed officers and employees, but the
petitioner refused. On February 27, 1992, the officers of the union filed a very
urgent petition for the issuance of a writ of preliminary injunction against the
petitioner under Article 218 (e) of theLabor Code. On March 11, 1992, the NLRC
issued a minute resolution in favor of the officers/employees ordering the
petitioner to reinstate them. The petitioner filed a motion for reconsideration of
the said resolution but the said motion was denied. The petitioner forthwith filed
with this Court on March 11, 1992 a petition for certiorari and prohibition against
the respondent union and its officers for the nullification of the said resolution. 18
In the meantime, the respondent union and the individual respondents
therein interposed an appeal from the decision of the Labor Arbiter to the NLRC.
The respondent union pointed out in its appeal that it had complied with the
requirements laid down in Articles 263 and 264 of the Labor Code because its
November 16, 1990 notice of strike was a mere reiteration of its September 27,
1990 notice of strike, which, in turn, complied with all the requirements of the
aforementioned articles, i.e.,the cooling-off period, the strike ban, the strike vote
and the strike vote report:
9. As above shown it is not disputed that the union filed a notice
of strike on September 27, 1990 [Exh. 12]; par. 5 (c) and for this
purpose, the union conducted a strike vote referendum and informed the
Department of Labor of the result of the strike vote, acting on which said
office issued its order of October 31, 1990 certifying the labor dispute to
the Honorable Commission for compulsory arbitration and enjoining the
parties from going on strike lockout [same par.; Exh. 16]. But then
despite said order the Hotel intended to decrease its plantilla by 200
employees [Exh. 17]; terminated 60 employees, including 2 union
officers, despite the vehement protests from the union; also terminating
on November 14, 1990, 86 employees effective December 14, 1990
[Exh. 20] and to put fear upon the union members, circularized that the
Hotel will close for a period of six months. So at this point in time,
November 14, 1990 their notice of strike of September 27, 1990 [Exh.
12] has not been withdrawn nor resolved one way or another such that
notice 'continued then as a warning that anyday (sic) after' the 15-day
cooling-off period a strike impends (Morabe, The Law on Strikes, 1962
First Ed. p. 187) as it happened on November 16, 1990. The notice of
 strike filed on this date is a mere reiteration of that earlier notice of strike
of September 27, 1990. Thus Union President Soluta declared in his
affidavit:
"36. The requirements of the law relative to the Notice of
Strike filed on September 27, 1990 having been complied with,
the union declared a strike against the company on November 16,
1990 based on grounds stated in the Notice of Strike filed on
September 27, 1990." 19
On August 4, 1993, this Court rendered a Decision in G.R. No. 104513
granting the petition and annulling the Resolution of the NLRC dated March 11,
1992. 20
Shortly thereafter, on September 30, 1993, the NLRC rendered a decision
affirming the decision of the labor arbiter, the decretal portion of which reads:
WHEREFORE, the respondents' appeal is hereby dismissed. The
complainant Hotel is however urged, on humanitarian consideration, to
pay the respondents a financial assistance computed at one month pay
for every year of service. 21
The NLRC ratiocinated that the compliance by therein respondents of the
requirements laid down in Articles 263 and 264 of the Labor Code respecting the
September 27, 1990 notice of strike filed by the union cannot be carried over to
the November 16, 1990 notice of strike. Resultantly, for failure of the union to
comply with the aforementioned requirements for its November 16, 1990 notice
of strike, the strike staged on November 16 up to November 29, 1990 was illegal.
The NLRC likewise cited the ruling of this Court in Union of Filipino Employees v.
Nestle Philippines, Inc. 22 However, the NLRC appealed to the petitioner to grant
separation pay to the members/officers of the respondent union who joined the
strike in this language:
This notwithstanding, we have deliberated on the question of
whether or not the complainants should receive financial assistance. And
while we are unanimously inclined to grant all the respondents
separation pay equivalent to one month for every year of service, we
however are so intimidated by the ruling of the Supreme Court in the
case of Benito D. Chua v. NLRC (G.R. No. 105775, February 8, 1993,
2nd Div., Feliciano, J.) where, despite the company's willingness to pay
financial assistance to complainant who was found guilty of participating
in an illegal strike at Nestle Philippines, the Supreme Court deleted the
NLRC's award thereon. And, taking cue from the Supreme Court ruling
that the company is not precluded from "making a grant on a
voluntary ex gratia basis' (but not through an award from this
Commission) we appeal to the complainant company that such a
financial assistance, for humanitarian reasons, be extended all the
respondents whose dismissals are hereby affirmed. 23
 The respondents filed a motion for reconsideration of the decision but the
NLRC issued an Order dated November 16, 1994 denying the same. 24
Dissatisfied, the respondents filed a petition for certiorari under Rule 65
before this Court docketed as G.R. No. 153664. Edna Dacanay, another officer
of the union, filed a similar petition before this Court docketed as G.R. No.
153665. Upon motion of the petitioner, the petitions were consolidated. Pursuant
to the ruling of this Court in St. Martin Funeral Homes v. NLRC, 25 the petitions
were remanded to the Court of Appeals (CA) and re-docketed as CA-G.R. SP
No. 53284 and CA-G.R. SP No. 53285, respectively. On January 9, 2002, the CA
rendered a decision giving due course to and granting the petitions; and ordering
the remand of the case to the labor arbiter for the determination of backwages
due to the respondent officers under the said decision. The decretal portion of
the decision reads:
WHEREFORE, premises considered, the instant petitions
for certiorari are hereby GIVEN DUE COURSE and GRANTED.
Consequently, the subject strike being LEGAL under the
prevailing circumstances then the DISMISSALS which ensued by virtue
of the assailed Decisions of Arbiter Linsangan and respondent NLRC are
UNJUSTIFIED and WITHOUT LEGAL BASIS.
Resultantly, the dismissed petitioners are entitled to
reinstatement, if this is feasible, otherwise to separation pay and
backwages plus disturbance compensation of P10,000.00 each, moral
damages of P50,000.00 each and exemplary damages of another
P10,000.00 each.
On the strength of the Supreme Court ruling in Serrano vs. NLRC,
et al. (G.R. No. 117040, January 27, 2000), except for the backwages
and the separation pays which would be determined by the LABOR
ARBITER, the Grand Boulevard Hotel, formerly known as Silahis
International Hotel, Inc., is ORDERED to pay immediately the
disturbance compensation, moral and exemplary damages.
Upon finality hereof, lest it be forgotten that justice delayed is
justice denied, the subject petitions should be REMANDED with dispatch
to the Labor Arbiter for immediate computation and payment of
backwages and separation pay due to petitioners. 26
In reversing the decisions of the NLRC and the Labor Arbiter, the CA took
into account the observation of the Solicitor General that the petitioner (Silahis)
retrenched employees pending the resolution of the certified cases respecting
the alleged illegal suspension and dismissals effected by the petitioner during
and prior to the notices of strike filed by the union. The Solicitor General opined
that even if the strike was staged without the proper notice and compliance with
the cooling-off period, resort thereto was simply triggered by the petitioners' belief
in good faith that respondent Silahis was engaged in ULP.27 The CA cited the
Order of the SOLE dated November 28, 1990 and the rulings of this Court
in Bacus v. Ople; 28 Bisig ng Manggagawa Sa Concrete Aggregates, Inc. v.
NLRC; 29 and Silahis International Hotel, Inc. v. NLRC. 30
Dissatisfied, the petitioner filed a motion for reconsideration of the said
decision. On May 27, 2002, the CA issued a resolution denying the said
motion. 31
In its petition at bar, the petitioner assails the decision and resolution of the
CA and prays for the reversal thereof, contending that:
I. The findings of fact of the Court of Appeals, particularly those
with respect to the unfair labor practice of petitioner Hotel were not
supported by the real facts and circumstances attendant to the instant
case.
II. The Court of Appeals' finding of legality of the union's strike
was a clear disregard of the requirements for a legal and valid strike as
prescribed by law and jurisprudence. 32
Private respondent Dacanay, in her comment on the petition in G.R. No.
153665, alleges that the retrenchment program of the petitioner was without
basis. The strike staged by the respondent union was sanctioned by its officers,
and was not a wildcat strike. The requirements provided for in Articles 263 and
264 of the Labor Code had been complied with; the issues posed by the
petitioner are factual; hence, not proper in a court petition. The petition should
thus be dismissed and the decision of the CA affirmed.
The respondent union, for its part, argues that the strike staged on
November 16, 1990 was lawful, considering the unfounded and illegal
retrenchment undertaken by the petitioner and the unfair labor practices
committed by the petitioner during the pendency of the resolution of the
certification cases. The petitioner failed to show that the CA committed a grave
abuse of its discretion amounting to excess or lack of jurisdiction in reversing the
decisions of the Labor Arbiter and NLRC. ICAcHE

The respondent union likewise expostulated that the certificate of non-

forum shopping embedded in the petition is defective because Jose Ma. Nuñez,
who executed the certification, was not authorized by board resolution to
specifically file the instant petition. The private respondent likewise asserted that
the petition should not be given due course for failure of the petitioner to attach
copies of relevant pleadings filed by the parties before the Labor Arbiter and the
NLRC.
The issues submitted for resolution are two-fold, namely: (1)
PROCEDURAL, to wit: (a) whether or not the certificate of non-forum shopping is
defective, and (b) whether or not the petition is insufficient in form for failure of
the petitioner to attach relevant pleadings that form part of the decision; and (2)
SUBSTANTIVE, to wit: (a) whether or not the strike staged by the respondent
union on November 16 up to 29, 1990 is legal, and (b) whether or not the
dismissals of the private respondents officers of the respondent union as a
consequence of the strike on November 16 to 29, 1990 are valid.
On the Procedural Issues
The respondents (except respondent Edna Dacanay) aver that the
certification of non-forum shopping embedded in the resolution of the Board of
Directors failed to specifically authorize Jose Ma. Nuñez to file the petition at bar
for and in behalf of the petitioner. A reading of the comment of the said
respondents reveals that they do not assail the sufficiency of the certification of
non-forum shopping submitted by the petitioner; rather, they aver that the
resolution of the Board of Directors of the petitioner appended to the petition
does not specifically authorize Jose Ma. Nuñez to file the petition at bar for and in
its behalf.
We do not agree. The resolution adverted to by the respondents reads:
RESOLVED, That the Board of Directors of Grand Boulevard
Hotel hereby authorize Mr. Jose Ma. Nuñez to do any and all of the
following acts: 1. to cause the filing of the proper legal actions, cases,
proceedings in the appropriate court; 2. to represent the Corporation in
any capacity in all suits of whatever kind and nature brought for or
against it and empowering him to engage the services of counsel as it
deems fit; and 3. to sign for and verify as well as authenticate such
petition, pleadings, documents, record and other papers necessary in
the successful prosecution of such suits, including the verification of
such petitions and pleadings. 33
There is no doubt that the resolution of the Board of Directors is broad enough
as to authorize Jose Ma. Nuñez to file the petition at bar for and in behalf of
the petitioner.
Likewise, barren of merit is the respondents' contention that the petition at
bar should be denied due course for failure of the petitioner to append to its
petition copies of pleadings, such as petitions, complaint, answer, resolutions,
orders, and decisions filed with the Labor Arbiter, the NLRC and the CA as
required by Section 4, Rule 45 of the Revised Rules of Court. What the rule
merely requires is for the petition to be accompanied by a clearly legible and
duplicate original or a certified true copy of the judgment or final order or
resolution of the court a quo and the requisite number of plain copies thereof and
such material portions of the record as would support the petition. The said rule
does not require the petitioner to append copies of all pleadings and decisions
filed by the parties with the Labor Arbiter, the NLRC and the CA. After all,
under Section 7 of the Rule, the Court may require the parties to file pleadings or
other documents as the Court deems necessary, and if the petition is given due
course, the Court may require the elevation of a complete record of the case as
provided for under Section 8 of the Rule.
On the Substantive Issues
The petitioner contends that the CA erred in its ruling that the petitioner
committed (ULP) and acted oppressively against the respondents; and in
concluding that the strike staged by the respondents on November 16, 1990 up
to November 29, 1990 was legal, and the termination of employment of the
respondents officers unlawful. The CA likewise erred in finding that even if the
strike staged by the respondents on November 16 to 29, 1990 was defective, the
same was cured when they staged the strike in good faith in the light of the
oppressive and unfair labor practices of the petitioner.
A striker cannot invoke good faith where assumption orders of the SOLE,
which operate as an injunction against a prospective strike, are disregarded. The
respondents failed to prove that the petitioner had committed any ULP on the
respondents and its employees. The testimony of respondent Rogelio Soluta and
the other officers of the respondent union before the Labor Arbiter did not
constitute sufficient proof of ULP. If the respondents perceived that the petitioner
committed ULP, the matter should have been threshed out with the appropriate
labor tribunal (NLRC or CA). Instead, the respondents staged a strike. Thus, the
retrenchment by the petitioner of its employees was within its prerogative and
was necessitated by —
The years 1989 and 1990 were particularly harsh to petitioner
Hotel. Serious financial reverses were brought about by the increase in
operational costs and a marked decline in its room occupancy rate. It
was also at this time that petitioner Hotel's business was threatened by
the emergence of more modern and refurbished hotels in Metro Manila.
It was in order to forestall the imminent threat of a partial or a total
closure of the business that petitioner Hotel, after a thorough study and
review of its corporate structure and financial set-up, decided to
implement the retrenchment program. Certainly, the employees were not
unaware of this situation. 34
The respondents assert that the issues posed by the petitioner in its
petition at bar involve questions of facts which are improper in a petition for
review on certiorari under Rule 45 of the Revised Rules of Court. Under the said
Rule, questions of facts should not be raised in a petition for review. However,
this rule admits of exceptions, such as where the findings of facts of the Labor
Arbiter and the NLRC and those of the CA are contradictory; when the
conclusions of the CA are based on speculations, surmises and conjectures;
where the judgment of the CA is premised on misapprehension of facts; or when
the CA failed to take into account and consider facts which if properly considered
would justify a different conclusion.
The CA did not commit any error in ruling that the petitioner was guilty of
ULP when it dismissed all the officers of the respondent union despite the
certificate orders of the SOLE and in defiance of the said orders; and the
respondents believed in good faith that indeed the petitioner committed ULP
which belief cured whatever defects there may have been in the November 16 to
29, 1990 strike staged by the respondents. The findings of the CA, and its
conclusions anchored on the said findings are supported by the evidence on
record, thus:
In the case at bar, petitioners staged the strike because of alleged
unfair labor practices committed by respondent Silahis, to wit,
termination of two hundred (200) employees in the guise of retrenchment
program, despite the certification order of then Secretary Ruben Torres
(Order dated October 31, 1990) enjoining a strike lockout. However, the
Labor Arbiter and the respondent NLRC did not rule on petitioners' claim
of unfair labor practices committed by respondent Silahis but merely
declared the strike illegal for not complying with the required notice and
cooling-off period and the certification order. But whether or not the
retrenchment program was valid or not, is not material in this case. The
issue is whether or not there was warranted belief in good faith on the
part of petitioners that respondent Silahis was then committing acts of
unfair labor practices.
It is established on record that on September 27, 1990, petitioner
Union filed a notice of strike against respondent Silahis for harassment,
arbitrary transfer of employees and illegal dismissal and suspension.
Subsequently, respondent Silahis informed the Office of' the Secretary of
its plan to retrench on a staggered basis one hundred seventy-one (171)
least senior employees over a period of sixty (60) days. On October 31,
1990, the Secretary certified the issues to the NLRC for compulsory
arbitration. The Order likewise enjoined any strike or lockout, whether
actual or intended.
On November 6, 1990, petitioner Union filed an Urgent Motion for
Reconsideration objecting to the certification order. On even date,
respondent Silahis informed the Secretary about its decision to
implement the retrenchment program as previously stated. On account
of this action of respondent Silahis terminating the services of some
union officers and members, petitioner union immediately filed a notice
of strike on November 16, 1990 and on the same day stated an actual
strike (which strike lasted up to November 29, 1990).
On November 23, 1990, respondent Silahis further effected the
retrenchment of one hundred ten (110) employees allegedly due to
 financial reverses and seventy-two (72) additional workers due to their
participation in the strike. 35
According to the respondents, the petitioner enforced its retrenchment
program at a time when there was an ongoing dispute between the petitioner
and the respondent union regarding the dismissal and suspension of
employees. This engendered an honest belief on the part of the respondents
that the petitioner was indeed committing ULP which impelled them to stage a
strike to protect their basic rights.
The petition is meritorious.
The relevant provision of Article 263 of the Labor Code reads:
Article 263. . . . (c). In cases of bargaining deadlocks, the duly
certified or recognized bargaining agent may file a notice of strike or the
employer may file a notice of lockout with the Ministry at least 30 days
before the intended date thereof. In cases of unfair labor practice, the
period of notice shall be 15 days and in the absence of a duly certified or
recognized bargaining agent, the notice of strike may be filed by any
legitimate labor organization in behalf of its members. However, in case
of dismissal from employment of union officers duly elected in
accordance with the union constitution and by-laws, which may
constitute union busting where the existence of the union is threatened,
the 15-day cooling-off period shall not apply and the union may take
action immediately.
xxx xxx xxx
(f) A decision to declare a strike must be approved by a majority
of the total union membership in the bargaining unit concerned, obtained
by secret ballot in meetings or referenda called for that purpose. A
decision to declare a lockout must be approved by a majority of the
board of directors of the corporation or association or of the partners in a
partnership, obtained by secret ballot in a meeting called for the
purpose. The decision shall be valid for the duration of the dispute based
on substantially the same grounds considered when the strike or lockout
vote was taken. The Department may at its own initiative or upon the
request of any affected party, supervise the conduct of the secret
balloting. In every case, the union or the employer shall furnish the
Ministry the voting at least seven days before the intended strike or lock-
out, subject to the cooling-off period herein provided. 36
Under the aforequoted provisions, the requisites for a valid strike are as
follows: (a) a notice of strike fled with the DOLE thirty days before the intended
date thereof or fifteen days in case of ULP; (b) strike vote approved by a majority
of the total union membership in the bargaining unit concerned obtained by
secret ballot in a meeting called for that purpose; (c) notice given to the DOLE of
the results of the voting at least seven days before the intended strike. 37 The
requisite seven-day period is intended to give the DOLE an opportunity to verify
whether the projected strike really carries the approval of the majority of the
union members. The notice of strike and the cooling-off period were intended to
provide an opportunity for mediation and conciliation. The requirements are
mandatory and failure of a union to comply therewith renders the strike
illegal. 38 A strike simultaneously with or immediately after a notice of strike will
render the requisite periods nugatory.
Moreover, a strike that is undertaken, despite the issuance by the SOLE of
an assumption or certification order, becomes a prohibited activity and, thus,
illegal pursuant to Article 264 of the Labor Code of the Philippines, as amended.
As this Court ruled in Union of Filipro Employees v. Nestle Philippines,
Inc., 39 under Article 264(a) of the said code, once an assumption certification
order is issued by the SOLE, strikes are enjoined or if one has already taken
place, all strikers shall immediately return to work:
We also wish to point out that an assumption and/or certification
order of the Secretary of Labor automatically results in a return-to-work
of all striking workers, whether or not a corresponding order has been
issued by the Secretary of Labor. Thus, the striking workers erred when
they continued with their strike alleging absence of a return-to-work
order. Article 264(g) (sic) is clear. Once an assumption/certification order
is issued, strikes are enjoined, or if one has already taken place, all
strikers shall immediately return to work.
A strike that is undertaken despite the issuance by the Secretary
of Labor of an assumption or certification order becomes a prohibited
activity and thus illegal, pursuant to the second paragraph of Art. 264 of
the Labor Code as amended (Zamboanga Wood Products, Inc. v. NLRC,
G.R. 82088, October 13, 1989; 178 SCRA 482). The Union officers and
members, as a result, are deemed to have lost their employment status
for having knowingly participated in an illegal act.40
In this case, the respondent union filed its notice of strike with the DOLE
on November 16, 1990 and on the same day, staged a picket on the premises of
the hotel, in violation of the law. Police operatives of the Western Police District
had to disperse the picketers and take into custody Union President Rogelio
Soluta and the other officers of respondent union, Henry Babay and Dennis
Cosico. The respondents cannot argue that since the notice of strike on
November 16, 1990 were for the same grounds as those contained in their notice
of strike on September 27, 1990 which complied with the requirements of the law
on the cooling-off period, strike ban, strike vote and strike vote report, the strike
staged by them on November 16, 1990 was lawful. The matters contained in the
notice of strike of September 27, 1990 had already been taken cognizance of by
the SOLE when he issued on October 31, 1990 a status quo ante bellum order
enjoining the respondent union from intending or staging a strike. Despite the
SOLE order, the respondent union nevertheless staged a strike on November 16,
1990 simultaneously with its notice of strike, thus violating Article 264(a) of
the Labor Code of the Philippines, as amended, which reads:
Art. 264. . . .
No strike or lockout shall be declared after assumption of
jurisdiction by the President or the Secretary or after certification or
submission of the dispute to compulsory or voluntary arbitration or during
the pendency of cases involving the same grounds for the strike or
lockout.
While it may be true that the petitioner itself barred the officers of the
respondent union from working and had terminated the employment of Kristoffer
So, and sent out circulars of its decision to retrench its employees effective
December 16, 1990, the same were not valid justifications for the respondents to
do away with the statutory procedural requirements for a lawful strike. It
behooved the respondents to avail themselves of the remedies under the CBA or
file an illegal dismissal case in the office of the Labor Arbiter against the
petitioner or by agreement of the parties, submit the case to the grievance
machinery of the CBA so that the matter may be subjected to voluntary arbitrary
proceedings instead of resorting to an immediate strike. 41 There was no
immediate and imperative need for the respondents to stage a strike on the very
day that the notice of strike on November 16, 1990 was filed because the
retrenchment envisaged by the petitioner had yet to take effect on December 14,
1990. The grievances of the respondent union could still very well be ordered
and acted upon by the SOLE before December 14, 1990.
The respondents' claim of good faith is not a valid excuse to dispense with
the procedural steps for a lawful strike. As this Court held in National Federation
of Labor v. NLRC: 42
Arguing that despite its failure to comply with the statutory
requirements necessary for a valid strike, NFL asserts that the same can
be declared legal for it was done in good faith, citing the cases
of People's Industrial and Commercial Employees and Workers
Organization (FFW) v. People's Industrial and Commercial Corp. and
Philippine Metal Foundries, Inc. v. Court of Industrial Relations. The
reliance is misplaced. People's Industrial did not rule that the procedural
steps can be dispensed with even if the union believed in good faith that
the company was committing an unfair labor practice. While, it is true
that Philippine Metal held that a strike cannot be declared as illegal for
lack of notice, however, it is important to note that said case was
decided in 1979. At this juncture, it must be stressed that with the
enactment ofRepublic Act No. 6715 which took effect on March 21,
1989, the rule now is that such requirements as the filing of a notice of
 strike, strike vote, and notice given to the Department of Labor are
mandatory in nature.
Thus, even if the union acted in good faith in the belief that the
company was committing an unfair labor practice, if no notice of strike
and a strike vote were conducted, the said strike is illegal.
In Lapanday Workers Union v. NLRC 43 we held that a strike is the most
preeminent of the economic weapons of workers which they unsheathe to force
management to agree to an equitable sharing of the joint product of labor and
capital. But we also emphasized that strikes exert some disquieting effects not
only on the relationship between labor and management, but also on the general
peace and progress of society, not to mention the economic well-being of the
State. It is a weapon that can either breathe life to or destroy the union and
members in their struggle with management for a more equitable due of their
labors. Hence, the decision to wield the weapon of strike must therefore rest on a
rational basis, free from emotionalism, unswayed by the tempers and tantrums of
a few hotheads, and firmly focused on the legitimate interest of the union which
should not however be antithetical to the public welfare. In every strike staged by
a union, the general peace and progress of society and public welfare are
involved. Indeed, in his Order dated October 31, 1990, the SOLE stated:
"The Company is one of the biggest hotels in the country and
contributes substantially to the tourism industry. It is recognized as one
of the major sources of foreign exchange earnings of the country,
housing a government-owned and controlled income generating agency
financing vital development projects of the government. Clearly, the
threatened work stoppage will result in huge financial losses not only to
the hotel but likewise the country. The ongoing development projects
of the government will be severely jeopardized and the economic
recovery program of the government will be unduly hampered.
Moreover, the security of employment of the more or less seven hundred
(700) employees is in grave state not to mention other workers who are
equally dependent on the continuous operations of the Company."
These considerations have in the past guided this Office in
consistently exercising its powers under Article 263(g) of the Labor
Code, as amended, in addressing and handling labor disputes in the
hotel industry. 44
Hence, the need for a union to adhere to and comply strictly with the
procedural conditions sine qua non provided for by the law in staging a strike.
IN LIGHT OF ALL THE FOREGOING, the petition is GRANTED. The
Decision of the Court of Appeals in CA-G.R. SP No. 53284 45 and its Resolution
in the same case Annex "B" of the petition are REVERSED AND SET ASIDE.
The Decision of the Labor Arbiter 46 is REINSTATED. TSacID
 Costs against the respondents.
SO ORDERED.
(Grand Boulevard Hotel v. Genuine Labor Organization of Workers in Hotel,
|||

G.R. Nos. 153664 & 153665, [July 18, 2003], 454 PHIL 463-492)

[G.R. No. 100158. June 29, 1992.]

ST. SCHOLASTICA'S COLLEGE, petitioner, vs. HON. RUBEN

TORRES, in his capacity as SECRETARY OF LABOR AND
EMPLOYMENT, and SAMAHAN NG MANGGAGAWANG PANG-
EDUKASYON SA STA. ESKOLASTIKA-NAFTEU, respondents.

Ernesto R. Arellano for private respondent.

William T. Chua for petitioner.

SYLLABUS

1. LABOR AND SOCIAL LEGISLATION; SECRETARY OF LABOR

AND EMPLOYMENT; SCOPE OF POWER TO ASSUME JURISDICTION
OVER LABOR DISPUTES CAUSING OR LIKELY TO CAUSE STRIKE OR
LOCKOUT IN AN INDUSTRY INDISPENSABLE TO THE NATIONAL
INTEREST. — The issue on whether respondent SECRETARY has the power
to assume jurisdiction over a labor dispute and its incidental controversies,
causing or likely to cause a strike or lockout in an industry indispensable to
the national interest, was already settled in International Pharmaceuticals,
Inc. v. Secretary of Labor and Employment (G.R. Nos. 92981-83, 9 January
1992). Therein, We ruled that: ". . . [T]he Secretary was explicitly granted by
Article 263 (g) of the Labor Code the authority to assume jurisdiction over a
labor dispute causing or likely to cause a strike or lockout in an industry
indispensable to the national interest, and decide the same accordingly.
Necessarily, this authority to assume jurisdiction over the said labor dispute
must include and extend to all questions and controversies arising therefrom,
including cases over which the Labor Arbiter has exclusive jurisdiction." And
rightly so, for, as found in the aforesaid case, Article 217 of the Labor
Code did contemplate of exceptions thereto where the SECRETARY is
authorized to assume jurisdiction over a labor dispute otherwise belonging
exclusively to the Labor Arbiter. This is readily evident from its opening
proviso reading "(e)xcept as otherwise provided under this Code . . ."
2. ID.; ID.; ID.; REQUISITES BEFORE THE SECRETARY MAY TAKE
COGNIZANCE OF AN INCIDENTAL ISSUE OF A LABOR DISPUTES. —
Previously, We held that Article 263 (g) of the Labor Code was broad enough
to give the Secretary of Labor and Employment the power to take jurisdiction
over an issue involving unfair labor practice. (Meycauayan College v. Drilon,
G.R. No. 81144, 7 May 1990; 185 SCRA 50) At first glance, the rulings above
stated seem to run counter to that of PAL v. Secretary of Labor and
Employment, (193 SCRA 223), which was cited by petitioner. But the conflict
is only apparent, not real. To recall, We ruled in the latter case that the
jurisdiction of the Secretary of Labor and Employment in assumption and/or
certification cases is limited to the issues that are involved in the disputes or
to those that are submitted to him for resolution. The seeming difference is,
however, reconcilable. Since the matter on the legality or illegality of the strike
was never submitted to him for resolution, he was thus found to have
exceeded his jurisdiction when he restrained the employer from taking
disciplinary action against employees who staged an illegal strike. Before the
Secretary of Labor and Employment may take cognizance of an issue which
is merely incidental to the labor dispute, therefore, the same must be involved
in the labor dispute itself, or otherwise submitted to him for resolution. If it was
not, as was the case in PAL v. Secretary of Labor and Employment, supra,
and he nevertheless acted on it, that assumption of jurisdiction is tantamount
to a grave abuse of discretion. Otherwise, the ruling in International
Pharmaceuticals, Inc. v. Secretary of Labor and Employment, supra, will
apply. The submission of an incidental issue of a labor dispute, in assumption
and/or certification cases, to the Secretary of Labor and Employment for his
resolution is thus one of the instances referred to whereby the latter may
exercise concurrent jurisdiction together with the Labor Arbiters.
3. ID.; ID.; ID.; ACADEMIC INSTITUTIONS COVERED. — The
assumption of jurisdiction by the Secretary of Labor and Employment over
labor disputes involving academic institutions was already upheld in Philippine
School of Business Administration v. Noriel (G.R. No. 80648, 15 August 1988,
164 SCRA 402) where We ruled thus: "There is no doubt that the on-going
labor dispute at the school adversely affects the national interest. The school
is a duly registered educational institution of higher learning with more or less
9,000 students. The on-going work stoppage at the school unduly prejudices
the students and will entail great loss in terms of time, effort and money to all
concerned. More important, it is not amiss to mention that the school is
engaged in the promotion of the physical, intellectual and emotional well-
being of the country's youth." Respondent UNION's failure to immediately
comply with the return-to-work order of 5 November 1990, therefore, cannot
be condoned.
4. ID.; ID.; ID.; ID.; PURPOSE THEREOF; CASE AT BAR. — In the
instant petition, the COLLEGE in its Manifestation, dated 16 November 1990,
asked the "Secretary of Labor to take the appropriate steps under the said
circumstances." It likewise prayed in its position paper that respondent
SECRETARY uphold its termination of the striking employees. Upon the other
hand, the UNION questioned the termination of its officers and members
before respondent SECRETARY by moving for the enforcement of the return-
to-work orders. There is no dispute then that the issue on the legality of the
termination of striking employees was properly submitted to respondent
SECRETARY for resolution. Such an interpretation will be in consonance with
the intention of our labor authorities to provide workers immediate access to
their rights and benefits without being inconvenienced by the arbitration and
litigation process that prove to be not only nerve-wracking, but financially
burdensome in the long run. Social justice legislation, to be truly meaningful
and rewarding to our workers, must not be hampered in its application by
long-winded arbitration and litigation. Rights must be asserted and benefits
received with the least inconvenience. For, labor laws are meant to promote,
not defeat, social justice (Maternity Children's Hospital v. Hon. Secretary of
Labor, G.R. No. 78909, 30 June 1989; 174 SCRA 632). After all, Art. 4 of
the Labor Code does state that all doubts in the implementation and
interpretation of its provisions, including its implementing rules and
regulations, shall be resolved in favor of labor.
5. ID.; ID.; RETURN TO WORK ORDER THEREOF; IMMEDIATELY
EFFECTIVE AND EXECUTORY NOTWITHSTANDING THE FILING OF THE
MOTION FOR RECONSIDERATIONS; RATIONALE; CASE AT BAR. —
Article 263 (g) of the Labor Codeprovides that if a strike has already taken
place at the time of assumption, "all striking . . . employees shall immediately
return to work." This means that by its very terms, a return-to-work order is
immediately effective and executory notwithstanding the filing of a motion for
reconsideration (University of Sto. Tomas v. NLRC, G.R. No. 89920, 18
October 1990; 190 SCRA 759). It must be strictly complied with even during
the pendency of any petition questioning its validity (Union of Filipro
Employees v. Nestle' Philippines, Inc., 192 SCRA 396). After all, the
assumption and/or certification order is issued in the exercise of respondent
SECRETARY's compulsive power of arbitration and, until set aside, must
therefore be immediately complied with. The rationale for this rule is explained
in University of Sto. Tomas v. NLRC, supra, citing Philippine Air Lines
Employees Association v. Philippine Air Lines, Inc., 38 SCRA 372 (1971) thus
— "To say that its (return-to-work order) effectivity must wait affirmance in a
motion for reconsideration is not only to emasculate it but indeed to defeat its
import, for by then the deadline fixed for the return to work would, in the
ordinary course, have already passed and hence can no longer be affirmed
insofar as the time element is concerned."
6. ID.; ID.; ID.; ID.; STRIKES DECLARED IN DEFIANCE THERETO;
CONSIDERED ILLEGAL; LIABILITY OF PARTICIPANTS. — The respective
liabilities of striking union officers and members who failed to immediately
comply with the return-to-work order is outlined in Art. 264 of the Labor
Code which provides that any declaration of a strike or lockout after the
Secretary of Labor and Employment has assumed jurisdiction over the labor
dispute is considered an illegal act. Any worker or union officer who knowingly
participates in a strike defying a return-to-work order may, consequently, "be
declared to have lost his employment status." Section 6, Rule IX, of the New
Rules of Procedure of the NLRC, which provides the penalties for defying a
certification order of the Secretary of Labor or a return-to-work order of the
Commission, also reiterates the same penalty. It specifically states that non-
compliance with the aforesaid orders, which is considered an illegal act, "shall
authorize the Secretary of Labor and Employment or the Commission . . . to
enforce the same under pain of loss of employment status." Under the Labor
Code, assumption and/or certification orders are similarly treated. Thus, we
held in Sarmiento v. Tuico, 162 SCRA 676, that by insisting on staging the
restrained strike and defiantly picketing the company premises to prevent the
resumption of operations, the strikers have forfeited their right to be
readmitted, having abandoned their positions, and so could be validly
replaced.
7. ID.; ID.; ID.; ID.; ID.; ID.; EFFECTIVE FROM THE MOMENT THE
EMPLOYEE DEFIES THE ORDER. — It is clear from the provisions above
quoted that from the moment a worker defies a return-to-work order, he is
deemed to have abandoned his job. It is already in itself knowingly
participating in an illegal act. Otherwise, the worker will just simply refuse to
return to his work and cause a standstill in the company operations while
retaining the positions they refuse to discharge or allow the management to fill
(Sarmiento v. Tuico, supra). Suffice it to say, in Federation of Free Workers v.
Inciong, supra, the workers were terminated from work after defying the
return-to-work order for only nine (9) days. It is indeed inconceivable that an
employee, despite a return-to-work order, will be allowed in the interim to
stand akimbo and wait until five (5) orders shall have been issued for their
return before they report back to work. This is absurd.
8. ID.; CONSTRUCTION OF THE RULES THEREOF IN FAVOR OF
LABOR; DOES NOT APPLY IN CASE OF WILLFUL DISOBEDIENCE
THERETO. — The sympathy of the Court which, as a rule, is on the side of
the laboring classes (Reliance Surety & Insurance Co., Inc. v. NLRC, G.R.
No. 86917-18, 25 January 1991; 193 SCRA 365), cannot be extended to the
 striking union officers and members in the instant petition. There was willful
disobedience not only to one but two return-to-work orders. Considering that
the UNION consisted mainly of teachers, who are supposed to be well-
lettered and well-informed, the Court cannot overlook the plain arrogance and
pride displayed by the UNION in this labor dispute. Despite containing threats
of disciplinary action against some union officers and members who actively
participated in the strike, the letter dated 9 November 1990 sent by the
COLLEGE enjoining the union officers and members to return to work on 12
November 1990 presented the workers an opportunity to return to work under
the same terms and conditions prior to the strike. Yet, the UNION decided to
ignore the same. The COLLEGE, correspondingly, had every right to
terminate the services of those who chose to disregard the return-to-work
orders issued by respondent SECRETARY in order to protect the interests of
its students who form part of the youth of the land.

DECISION

BELLOSILLO, J : p

The principal issue to be resolved in this recourse is whether striking

union members terminated for abandonment of work after failing to comply
with return-to-work orders of the Secretary of Labor and Employment
(SECRETARY, for brevity) should by law be reinstated. LexLib

On 20 July 1990, petitioner St. Scholastica's College (COLLEGE, for

brevity) and private respondent Samahan ng Manggagawang Pang-
Edukasyon sa Sta. Eskolastika — NAFTEU (UNION, for brevity) initiated
negotiations for a first-ever collective bargaining agreement. A deadlock in the
negotiations prompted the UNION to file on 4 October 1990 a Notice of Strike
with the Department of Labor and Employment (DEPARTMENT, for brevity),
docketed as NCMB-NCR-NS-10-826-90.
On 5 November 1990, the UNION declared a strike which paralyzed the
operations of the COLLEGE. Affecting as it did the interest of the students,
public respondent SECRETARY immediately assumed jurisdiction over the
labor dispute and issued on the same day, 5 November 1990, a return-to-
work order. The following day, 6 November 1990, the UNION was served the
Order. On 7 November 1990, instead of returning to work, the UNION filed a
motion for reconsideration of the return-to-work order questioning inter alia the
assumption of jurisdiction by the SECRETARY over the labor dispute.
On 9 November 1990, the COLLEGE sent individual letters to the
striking employees enjoining them to return to work not later than 8.00 o'clock
A.M. of 12 November 1990 and, at the same time, giving notice to some
twenty-three (23) workers that their return would be without prejudice to the
filing of appropriate charges against them. In response, the UNION presented
a list of six (6) demands to the COLLEGE in a dialogue conducted on 11
November 1990. The most important of these demands was the unconditional
acceptance back to work of the striking employees. But these were flatly
rejected.
Likewise, on 9 November 1990, respondent SECRETARY denied
reconsideration of his return-to-work order and sternly warned the striking
employees to comply with its terms. On 12 November 1990, the UNION
received the Order.
Thereafter, particularly on 14 and 15 November 1990, the parties held
conciliation meetings before the National Conciliation and Mediation Board
where the UNION pruned down its demands to three (3), viz.: that striking
employees be reinstated under the same terms and conditions before the
strike; that no retaliatory or disciplinary action be taken against them; and, that
CBA negotiations be continued. However, these efforts proved futile as the
COLLEGE remained steadfast in its position that any return-to-work offer
should be unconditional.
On 16 November 1990, the COLLEGE manifested to respondent
SECRETARY that the UNION continued to defy his return-to-work order of 5
November 1990 so that "appropriate steps under the said circumstances" may
be undertaken by him. 1
On 23 November 1990, the COLLEGE mailed individual notices of
termination to the striking employees, which were received on 26 November
1990, or later. The UNION officers and members then tried to return to work
but were no longer accepted by the COLLEGE.
On 5 December 1990, a Complaint for Illegal Strike was filed against
the UNION, its officers and several of its members before the National Labor
Relations Commission (NLRC), docketed as NLRC Case No. 00-12-06256-
90.
The UNION moved for the enforcement of the return-to-work order
before respondent SECRETARY, citing "selective acceptance of returning
strikers" by the COLLEGE. It also sought dismissal of the complaint. Since
then, no further hearings were conducted.
Respondent SECRETARY required the parties to submit their
respective position papers. The COLLEGE prayed that respondent
SECRETARY uphold the dismissal of the employees who defied his return-to-
work order.
 On 12 April 1991, respondent SECRETARY issued the assailed Order
which, inter alia directed the reinstatement of striking UNION members,
premised on his finding that no violent or otherwise illegal act accompanied
the conduct of the strike and that a fledgling UNION like private respondent
was "naturally expected to exhibit unbridled if inexperienced enthusiasm, in
asserting its existence". 2 Nevertheless, the aforesaid Order held UNION
officers responsible for the violation of the return-to-work orders of 5 and 9
November 1990 and, correspondingly, sustained their termination.
Both parties moved for partial reconsideration of the Order, with
petitioner COLLEGE questioning the wisdom of the reinstatement of striking
UNION members, and private respondent UNION, the dismissal of its officers.
On 31 May 1991, in a Resolution, respondent SECRETARY denied
both motions. Hence, this Petition for Certiorari, with Prayer for the Issuance
of a Temporary Restraining Order.
On 26 June 1991, We restrained the SECRETARY from enforcing his
assailed Orders insofar as they directed the reinstatement of the striking
workers previously terminated. prcd

Petitioner questions the assumption by respondent SECRETARY of

jurisdiction to decide on termination disputes, maintaining that such
jurisdiction is vested instead in the Labor Arbiter pursuant to Art. 217 of
the Labor Code, thus —
"Art. 217. Jurisdiction of Labor Arbiters and the Commission. — (a)
Except as otherwise provided under this Code, the Labor Arbiters shall
have original and exclusive jurisdiction to hear and decide, within thirty
(30) calendar days after the submission of the case by the parties for
decision without extension, the following cases involving all workers,
whether agricultural or non-agricultural: . . . 2. Termination disputes . . .
5. Cases arising from any violation of Article 264 of this Code, including
questions on the legality of strikes and lock-outs . . ."
In support of its position, petitioner invokes Our ruling in PAL v.
Secretary of Labor and Employment 3 where We held:
"The Labor Secretary exceeded his jurisdiction when he restrained PAL
from taking disciplinary measures against its guilty employees, for, under
Art. 263 of the Labor Code, all that the Secretary may enjoin is the
holding of the strike but not the company's right to take action against
union officers who participated in the illegal strike and committed illegal
acts."
Petitioner further contends that following the doctrine laid down
in Sarmiento v. Tuico 4 and Union of Filipro Employees v. Nestle Philippines,
Inc., 5 workers who refused to obey a return-to-work order are not entitled to
be paid for work not done, or to reinstatement to the positions they have
abandoned by reason of their refusal to return thereto as ordered.
Taking a contrary stand, private respondent UNION pleads for
reinstatement of its dismissed officers considering that the act of the UNION
in continuing with its picket was never characterized as a "brazen disregard of
successive legal orders", which was readily apparent in Union Filipro
Employees v. Nestle' Philippines, Inc., supra, nor was it a willful refusal to
return to work, which was the basis of the ruling in Sarmiento v. Tuico, supra.
The failure of UNION officers and members to immediately comply with the
return-to-work orders was not because they wanted to defy said orders;
rather, they held the view that academic institutions were not industries
indispensable to the national interest. When respondent SECRETARY denied
their motion, for reconsideration, however, the UNION intimated that efforts
were immediately initiated to fashion out a reasonable return-to-work
agreement with the COLLEGE, albeit, it failed.
The issue on whether respondent SECRETARY has the power to
assume jurisdiction over a labor dispute and its incidental controversies,
causing or likely to cause a strike or lockout in an industry indispensable to
the national interest, was already settled in International Pharmaceuticals, Inc.
Secretary of Labor and Employment. 6 Therein, We ruled that:
". . . [T]he Secretary was explicitly granted by Article 263 (g) of the Labor
Code the authority to assume jurisdiction over a labor dispute causing or
likely to cause a strike or lockout in an industry indispensable to the
national interest, and decide the same accordingly. Necessarily, this
authority to assume jurisdictional over the said labor dispute must
include and extend to all questions and controversies arising therefrom,
including cases over which the Labor Arbiter has exclusive jurisdiction."
And rightly so, for, as found in the aforesaid case, Article 217 of
the Labor Code did contemplate of exceptions thereto where the
SECRETARY is authorized to assume jurisdiction over a labor dispute
otherwise belonging exclusively to the Labor Arbiter. This is readily evident
from its opening proviso reading "(e)xcept as otherwise provided under this
Code . . ."
Previously, We held that Article 263 (g) of the Labor Code was broad
enough to give the Secretary of Labor and Employment the power to take
jurisdiction over an issue involving unfair labor practice. 7
At first glance, the rulings above stated seem to run counter to that
of PAL v. Secretary or Labor and Employment, supra,which was, cited by
petitioner. But the conflict is only apparent, not real.
 To recall, We ruled in the latter case that the jurisdiction of the
Secretary of Labor and Employment in assumption and/or certification cases
is limited to the issues that are involved in the disputes or to those that are
submitted to him for resolution. The seeming difference is, however,
reconcilable. Since the matter on the legality or illegality of the strike was
never submitted to him for resolution, he was thus found to have exceeded his
jurisdiction when he restrained the employer from taking disciplinary action
against employees who staged an illegal strike.
Before the Secretary of Labor and Employment may take cognizance of
an issue which is merely incidental to the labor dispute, therefore, the same
must be involved in the labor dispute itself, or otherwise submitted to him for
resolution. If it was not, as was the case in PAL v. Secretary of Labor and
Employment, supra, and he nevertheless acted on it, that assumption of
jurisdiction is tantamount to a grave abuse of discretion. Otherwise, the ruling
in International Pharmaceuticals, Inc. v. Secretary of Labor and Employment,
supra, will apply.
The submission of an incidental issue of a labor dispute, in assumption
and/or certification cases, to the Secretary of Labor and Employment for his
resolution is thus one of the instances referred to whereby the latter may
exercise concurrent jurisdiction together with the Labor Arbiters.
In the instant petition, the COLLEGE in its Manifestation, dated 16
November 1990, asked the "Secretary of Labor to take the appropriate steps
under the said circumstances." It likewise prayed in its position paper that
respondent SECRETARY uphold its termination of the striking employees.
Upon the other hand, the UNION questioned the termination of its officers and
members before respondent SECRETARY by moving for the enforcement of
the return-to-work orders. There is no dispute then that the issue on the
legality of the termination of striking employees was properly submitted to
respondent SECRETARY for resolution.
Such an interpretation will be in consonance with the intention of our
labor authorities to provide workers immediate access to their rights and
benefits without being inconvenienced by the arbitration and litigation process
that prove to be not only nerve-wracking, but financially burdensome in the
long run. Social justice legislation, to be truly meaningful and rewarding to our
workers, must not be hampered in its application by long-winded arbitration
and litigation. Rights must be asserted and benefits received with the least
inconvenience. For, labor laws are meant to promote, not defeat, social justice
(Maternity Children's Hospital v. Hon. Secretary of Labor). 8 After all, Art. 4 of
the Labor Code does state that all doubts in the implementation and
interpretation of its provisions, including its implementing rules and
regulations, shall be resolved in favor of labor.
 We now come to the more pivotal question of whether striking union
members, terminated for abandonment of work after failing to comply strictly
with a return-to-work order, should be reinstated.
We quote hereunder the pertinent provisions of law which govern the
effects of defying a return-to-work order:
1. Article 263 (g) of the Labor Code —
"Art. 263. Strikes, picketing, and lockouts. — . . . (g) When, in his
opinion, there exists a labor dispute causing or likely to cause a strike or
lockout in an industry indispensable to the national interest, the
Secretary of Labor and Employment may assume jurisdiction over the
dispute and decide it or certify the same to the Commission for
compulsory arbitration. Such assumption or certification shall have the
effect of automatically enjoining the intended or impending strike or
lockout as specified in the assumption or certification order. If one has
already taken place at the time of assumption or certification, all striking
or locked out employees shall immediately return to work and the
employer shall immediately resume operations and readmit all workers
under the same terms and conditions prevailing before the strike or
lookout. The Secretary of Labor and Employment or the Commission
may seek the assistance of law enforcement agencies to ensure
compliance with this provision as well as with such orders as he may
issue to enforce the same . . ." (as amended by Sec. 27, R.A. 6715;
emphasis supplied).
2. Article 264, same Labor Code —
"Art. 264. Prohibited activities. — (a) No labor organization or employer
shall declare a strike or lockout without first having bargained collectively
in accordance with Title VII of this Book or without first having filed the
notice required in the preceding Article or without the necessary strike or
lockout vote first having been obtained and reported to the Ministry.
"No strike or lockout shall be declared after assumption of jurisdiction by
the President or the Minister or after certification or submission of the
dispute to compulsory or voluntary arbitration or during the pendency of
cases involving the same grounds for the strike or lockout . . . (emphasis
supplied).
"Any worker whose employment has been terminated as a consequence
of an unlawful lockout shall be entitled to reinstatement with full back
wages. Any union officer who knowingly participates in 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 . . ." (emphasis supplied).
3. Section 6, Rule IX, of the New Rules of Procedure of the NLRC
(which took effect on 31 August 1990) —
"Section 6. Effects of Defiance. — Non-compliance with the certification
order of the Secretary of Labor and Employment or a return to work
order of the Commission shall be considered an illegal act committed in
the course of the strike or lookout and shall authorize the Secretary of
Labor and Employment or the Commission, as the case may be, to
enforce the same under pain or loss of employment status or entitlement
to full employment benefits from the locking-out employer or backwages,
damages and/or other positive and/or affirmative reliefs, even to criminal
prosecution against the liable parties . . ." (emphasis supplied).
Private respondent UNION maintains that the reason they failed ko
immediately comply with the return-to-work order of 5 November 1990 was
because they questioned the assumption of jurisdiction of respondent
SECRETARY. They were of the impression that being an academic
institution, the school could not be considered an industry indispensable to
national interest, and that pending resolution of the issue, they were under no
obligation to immediately return to work.
This position of the UNION is simply flawed. Article 263 (g) Labor
Code provides that if a strike has already taken place at the time of
assumption, "all striking . . . employees shall immediately return to work." This
means that by its very terms, a return-to-work order is immediately effective
and executory notwithstanding the filing of a motion for reconsideration
(University of Sto. Tomas v. NLRC). 9 It must be strictly complied with even
during the pendency of any petition questioning its validity (Union of Filipro
Employees v. Nestle' Philippines, Inc., supra) After all, the assumption and/or
certification order is issued in the exercise of respondent SECRETARY's
compulsive power of arbitration and, until set aside, must therefore be
immediately complied with.
The rationale for this rule is explained in University of Sto. Tomas
v. NLRC, supra, citing Philippine Air Lines Employees Association
v. Philippine Air Lines, Inc., 10 thus —
"To say that its (return-to-work order) effectivity must wait affirmance in a
motion for reconsideration is not only to emasculate it but indeed to
defeat its import, for by then the deadline fixed for the return to work
would, in the ordinary course, have already passed and hence can no
longer be affirmed insofar as the time element is concerned."
Moreover, the assumption of jurisdiction by the Secretary of Labor and
Employment over labor disputes involving academic institutions was already
upheld in Philippine School of Business Administration v. Noriel 11 where We
ruled thus:
"There is no doubt that the on-going labor dispute at the school
adversely affects the national interest. The school is a duly registered
educational institution of higher learning with more or less 9,000
students. The on-going work stoppage at the school unduly prejudices
the students and will entail great loss in terms of time, effort and money
to all concerned. More important, it is not amiss to mention that the
school is engaged in the promotion of the physical, intellectual and
emotional well-being of the country's youth."
Respondent UNION's failure to immediately comply with the return-to-
work order of 5 November 1990, therefore, cannot be condoned.
The respective liabilities of striking union officers and members who
failed to immediately comply with the return-to-work order is outlined in Art.
264 of the Labor Code which provides that any declaration of a strike or
lockout after the Secretary of Labor and Employment has assumed
jurisdiction over the labor dispute is considered an illegal act. Any worker or
union officer who knowingly participates in a strike defying a return-to-work
order may, consequently, "be declared to have lost his employment status."
Section 6, Rule IX, of the New Rules of Procedure of the NLRC, which
provides the penalties for defying a certification order of the Secretary of
Labor or a return-to-work order of the Commission, also reiterates the same
penalty. It specifically states that non-compliance with the aforesaid orders,
which is considered an illegal act, "shall authorize the Secretary of Labor and
Employment or the Commission . . . to enforce the same under pain of loss of
employment status." Under the Labor Code, assumption and/or certification
orders are similarly treated.
Thus, we held in Sarmiento v. Tuico, supra, that by insisting on staging
the restrained strike and defiantly picketing the company premises to prevent
the resumption of operations, the strikers have forfeited their right to be
readmitted, having abandoned their positions, and so could be validly
replaced.Cdpr

We recently reiterated this stance in Federation of Free Workers

v. Inciong, 12 wherein we cited Union of Filipro Employees
v. Nestle' Philippines, Inc., supra, thus —
"A strike undertaken despite the issuance by the Secretary of Labor of
an assumption or certification order becomes a prohibited activity and
thus illegal, pursuant to the second paragraph of Art. 264 of the Labor
Code as amended . . . The union officers and members, as a result, are
deemed to have lost their employment status for having knowingly
participated in an illegal act."
 Despite knowledge of the ruling in Sarmiento v. Tuico, supra, records of
the case reveal that private respondent UNION opted to defy not only the
return-to-work order of 5 November 1990 but also that of 9 November 1990.
While they claim that after receiving copy of the Order of 9 November
1990 initiatives were immediately undertaken to fashion out a return-to-work
agreement with management, still, the unrebutted evidence remains that the
striking union officers and members tried to return to work only eleven (11)
days after the conciliation meetings ended in failure, or twenty (20) days after
they received copy of the first return-to-work order on 5 November 1990.
The sympathy of the Court which, as a rule, is on the side of the
laboring classes (Reliance Surety & Insurance Co., Inc. v. NLRC), 13 cannot
be extended to the striking union officers and members in the instant petition.
There was willful disobedience not only to one but two return-to-work orders.
Considering that the UNION consisted mainly of teachers, who are supposed
to be well-lettered and well-informed, the Court cannot overlook the plain
arrogance and pride displayed by the UNION in this labor dispute. Despite
containing threats of disciplinary action against some union officers and
members who actively participated in the strike, the letter dated 9 November
1990 sent by the COLLEGE enjoining the union officers and members to
return to work on 12 November 1990 presented the workers an opportunity to
return to work under the same terms and conditions prior to the strike. Yet, the
UNION decided to ignore the same. The COLLEGE, correspondingly, had
every right to terminate the services of those who chose to disregard the
return-to-work orders issued by respondent SECRETARY in order to protect
the interests of its students who form part of the youth of the land.
Lastly, the UNION officers and members also argue that the doctrine
laid down in Sarmiento v. Tuico, supra, andUnion of Filipro Employees
v. Nestle' Philippines, Inc., supra, cannot be made applicable to them because
in the latter two cases, workers defied the return-to-work orders for more than
five (5) months. Their defiance of the return-to-work order, it is said, did not
last more than a month.
Again, this line of argument must be rejected. It is clear from the
provisions above quoted that from the moment a worker defies a return-to-
work order, he is deemed to have abandoned his job. It is already in itself
knowingly participating in an illegal act. Otherwise, the worker will just simply
refuse to return to his work and cause a standstill they refused to discharge or
allow the management to fill (Sarmiento v. Tuico, supra). Suffice it to say,
in Federation of Free Workers v.Inciong, supra, the workers were terminated
from work after defying the return-to-work order for only nine (9) days. It is
indeed inconceivable that an employee, despite a return-to-work order, will be
 allowed in the interim to stand akimbo and wait until five (5) orders shall have
been issued for their return before they report back to work. This is absurd.
In fine, respondent SECRETARY gravely abused his discretion when
he ordered the reinstatement of striking union members who refused to report
back to work after he issued two (2) return-to-work orders, which in itself is
knowingly participating in an illegal act. The Order in question is, certainly,
contrary to existing law and jurisprudence.
WHEREFORE, the Petition for Certiorari is hereby GRANTED. The
Order of 12 April 1991 and the Resolution of 31 May 1991 both issued by
respondent Secretary of Labor and Employment are SET ASIDE insofar as
they order the reinstatement of striking union members terminated by
petitioner, and the temporary restraining order We issued on June 26, 1991, is
made permanent.
No costs.
SO ORDERED.
(St. Scholastica's College v. Torres, G.R. No. 100158, [June 29, 1992], 285
|||

PHIL 1103-1119)

[G.R. No. L-25878. March 28, 1969.]

PHILIPPINE ASSOCIATION OF FREE LABOR UNIONS

(PAFLU), petitioner, vs. JUDGE GAUDENCIO CLORIBEL OF
THE COURT OF FIRST INSTANCE OF MANILA; WELLINGTON
INVESTMENT & MANUFACTURING CORPORATION; and
METROPOLITAN BANK & TRUST COMPANY, respondents.

Cipriano Cid and Associates; Israel Bacobo for petitioner.

Angel C . Sepidoza for respondent Wellington Investment and
Manufacturing Corporation.
Tañada, Carreon and Tañada for respondent Metropolitan Bank and
Trust Co.

SYLLABUS
 1. LABOR LAWS; INDUSTRIAL PEACE ACT; LABOR DISPUTE; NON-
EXISTENCE THEREOF IN INSTANT CASE. — A cursory examination of the
record reveals that there exists no labor dispute between petitioner PAFLU
and either of the two complainants in the court a quo, namely, Wellington in
Civil Case No. 64831 and Galang in Civil Case No. 64909. It is an admitted
fact that the strike and the picket are directed against METBANK, an entirely
different and separate entity without connection whatsoever with Wellington
and Galang other than the incidental fact that they are the bank's landlord and
co-lessee in the Wellington Building, respectively. Their relationship is so
remote that there is no indicium of said complainants' interests in the labor
dispute between the union and METBANK as to make the two cases below
fall within the purview of Section 2 of Republic Act No. 975 which provides
that a labor dispute exist "regardless of whether disputants stand in the
proximate relation of employer and employee."
2. ID; ID; ID; CASE OF ASSOCIATED WATCHMEN AND SECURITY
UNION DISTINGUISHED FROM INSTANT CASE. — In the case of
Associated Watchmen and Security Union (PTWO), et al., vs. United States
Lines, et al. (supra), there was found a "labor dispute" between the striking
watchmen and the steamship agency although the former (who were
assigned to guard the latter's ships) were contracted for by a watchmen
agency because, in the last analysis, their services were availed of and their
compensation paid by the steamship agency. There is no analogous nexus
between the parties in the instant case. And the convenient inclusion of
METBANK as one of the present respondents does not, to our mind, provide
the necessary link between said parties as to transform this into a labor
dispute case.
3. ID; ID; ID; PICKETING; REGULATION BY INJUNCTION. — The
proper relief to protect the rights of Wellington and Galang, who are innocent
bystanders in the labor case between the union and METBANK, is an
injunction, issued in accordance with Rule 58 of the Rules of Court.
4. ID; ID; ID; ID; ID; ISSUANCE THEREOF IRREGULAR WHERE
NECESSARY BONDS WERE NOT FILED. — Where there was a failure on
the part of the respondent judge to require Wellington and Galang to file the
necessary bonds before issuing the two preliminary injunctions, the issuance
thereof is attended by irregularity for under Sec. 4 of Rule 58, the filing of said
bonds is a mandatory requirement. Such failure, being a disregard of plain
legal mandate, amounts to a grave abuse of discretion.
5. CONSTITUTIONAL LAW; BILL OF RIGHTS; FREEDOM OF
SPEECH; RIGHT TO PICKET, A PHASE OF THE RIGHT OF FREE
UTTERANCE. — The right to picket as a means of communicating the facts
of a labor dispute is a phase of the freedom of speech guaranteed by the
 constitution. If peacefully carried out, it cannot be curtailed even in the
absence of employer- employee relationship.
6. ID; ID; ID; ID; RIGHT NOT ABSOLUTE. — The right to picket is not
an absolute one. While peaceful picketing is entitled to protection as an
exercise of free speech, the courts are not without power to confine or localize
the sphere of communication or the demonstration to the parties to the labor
dispute, including those with related interest, and to insulate establishments or
persons with no industrial connection or having interest totally foreign to the
context of the dispute. The right may be regulated at the instance of third
parties or "innocent bystanders" if it appears that the inevitable result of its
exercise is to create an impression that a labor dispute with which they have
no connection or interest exists between them and the picketing union or
constitute an invasion of their rights.
7. ID; ID; ID; ID; ID; REGULATION BY INJUNCTION. — The proper
relief to protect the rights of Wellington and Galang who are innocent
bystanders in the case between the union and METBANK is an injunction,
issued in accordance with Rule 58 of the Rules of Court.

DECISION

REYES, J.B.L., J :p

Petition for certiorari with preliminary injunction to annul, and in the

meantime check, enforcement of two identical orders issued ex parte by
former Judge Gaudencio Cloribel of the Court of First Instance of Manila
directing the Philippine Association of Free Labor Unions, otherwise known as
PAFLU, and its members to cease and desist, among other acts, from
demonstrating or picketing in front or along the common passageway of the
six-storey Wellington Building in Plaza Calderon, Binondo, Manila, owned by
the Wellington Investment and Manufacturing Corporation, hereinafter
referred to as Wellington, and tenanted by different persons and business
firms.
Picketed by PAFLU was Metropolitan Bank and Trust Company,
METBANK for short, located at the ground floor of the Wellington Building.
Wellington complained, however, that the picketers were annoyingly blocking
the common passageway of the building, the only ingress and egress being
used by the occupants of the second to the sixth floors thereof as well as by
their respective employees, clients and customers; that besides giving the
disconcerting impression that a strike had been declared against it or any of
the aforementioned occupants of the second to the sixth floors of the building,
the picketing of the passageway in question placed it in an embarrasing
position as the same occupants, mostly affected business firms, demanded
protection of their peaceful enjoyment of, and free access to and from, the
premises respectively leased by them; and that by reason of the picket it
sustained damages in the amount of P15,000.00, plus P2,000.00 attorney's
fees, and would continue to sustain damages unless the picketers were
restrained from carrying on their harassing acts. Thus this litigation started
with Wellington charging in court the picketing PAFLU and some twenty-four
named individuals and twenty- five John Does, who were employees of
neither the corporation nor any of its tenants occupying the second to the
sixth floors of the building, of undue interference not only with its enjoyment of
its property and business of leasing and administering the same but also with
the businesses of said neutral tenants.
And as prayed for by Wellington, then Vice Executive Judge Cloribel of
the Court of First Instance of Manila issued ex parte the following order: 1
"This is a complaint for injunction with a prayer for the issuance of
a writ of preliminary injunction filed by plaintiff against the defendants.
"Pending the assignment of this case to the corresponding branch
of this Court in accordance with the New Rules of Court which may take
some time and, in order to prevent further injury or damage to the
plaintiff and/or its tenants, defendants, their agents, representatives and
others acting for them and/or their behalf, are directed to cease and
desist from perpetrating their nuisance activities, from demonstrating
and/or picketing in front of and/or along that passageway known as '624
Plaza Calderon, Binondo, Manila' and/or from resorting to disorderly
conduct in and about plaintiff's premises and from leaving their signs and
placards unattended along the side of plaintiff's premises.
"This order shall be without prejudice to whatever action or
disposition the Presiding Judge of the branch to which this case may be
assigned and may take on the matter.
"SO ORDERED."
Immediately thereafter, PAFLU filed the present petition in the Supreme
Court, alleging that respondent Judge Cloribel acted without jurisdiction and
with grave abuse of discretion in issuing the foregoing order, in violation of the
strict jurisdictional requirements of Section 9 (d) on labor injunctions
of Republic Act No. 875, also known as the Industrial Peace Act, as well as of
Section 9 (a) of the same Act. Nowhere in the complaint, PAFLU pointed out,
were there allegations of, much less testimony proving, the matters prescribed
by subsections 1 to 5 of said Section 9 (d). Neither was there an allegation
nor a showing by testimony under oath of the unavoidable, substantial, and
irreparable injury to complainant Wellington's property as would justify the
issuance of the temporary restraining order without notice. And neither was
there a bond filed by Wellington sufficient to recompense those enjoined for
any loss, expense, or damage caused by the improvident or erroneous
issuance of the same order. Such omissions, coupled with the grave injustice
occasioned by said restraining order allegedly prohibiting, in effect, the union's
right to picket METBANK's premises, place of work of its members who were
striking employees of said bank against which, incidentally, a case for unfair
labor practice had already been filed in the Court of Industrial Relations,
purportedly divested respondent Judge of his jurisdiction. Hence, PAFLU's
claim to a right to the writ of certiorari with preliminary injunction previously
intimated, there being, it further avouched, no appeal nor any plain, speedy
and adequate remedy in the ordinary course of law.
In a resolution dated 30 March 1966, the Supreme Court granted the
temporary restraining order but limited its effectivity until 12 April 1966.
In compliance with the same resolution, Judge Cloribel's co-
respondents Wellington and METBANK filed their answers to the petition,
separately but actually advancing the same defenses, to wit: That since Civil
Case No. 64831 of the Court of First Instance of Manila did not involve nor
arise out of a labor dispute between the parties thereto, namely, Wellington,
alone as plaintiff, and PAFLU, et al., as defendants, conformance with the
provisions of Section 9 of Republic Act No. 875 was not necessary; that since
the same case was primarily for an injunction with damages, as shown by the
averments in Wellington's complaint, said lower court had the jurisdiction; that
the mere inclusion of METBANK as one of the present respondents, although
it was not an original party below, did not convert the case into a labor
injunction suit; and that for the foregoing reasons, in addition to the failure of
PAFLU to first seek reconsideration of the order in question, the petition
should be dismissed and respondent judge's injunction made permanent or, at
least, according to METBANK, it should be dropped as a respondent for
having been improperly included as such. 2
In another resolution dated 11 April 1966, the Supreme Court extended
"until further notice" the time limit of its restraining order. This time, however, it
restricted the operation thereof to only such extent as respondent judge's
injunction prohibited the demonstration or the picketing in front of the common
passageway identified as "624 Plaza Calderon, Binondo, Manila." In all other
respects, said respondent judge's injunction remained unaffected.
Subsequently, PAFLU filed a supplemental petition for certiorari in the
Supreme Court protesting the issuance on 31 March 1966, in a different
case 3 but by the same respondent judge, of another injunction couched in
exactly the same words as the first. Allegedly requested by PAFLU to withhold
enforcement thereof, Judge Cloribel issued instead, on 1 April 1966, an order
clarifying that said injunction covered only the common passageway and did
not in any manner seek to restrain picketing or similar activities outside of its
area. PAFLU thus prayed for a second restraining order believing that it had a
right to picket even said passageway to give publicity and enlist sympathy to
its strike and that said injunction was similarly issued not only without
jurisdiction and with grave abuse of discretion but also in defiance of the first
order of the Supreme Court.
On 25 April 1966, the Supreme Court issued its third resolution
admitting the supplemental petition. PAFLU's prayer for issuance of a writ of
preliminary injunction was, however, denied.
Answering the supplemental petition, Emmanuel T. Galang, the person
in whose favor the second injunction was issued, interposed defenses not
different from those of Wellington and METBANK. He warded off PAFLU's
accusation that the second injunction transgressed the Supreme Court's
restraining order of 30 March 1966 by arguing that the same was no longer
effective, it having been superseded by said Court's resolutions dated 11 and
25 April 1966; and that, assuming that said restraining order was still effective,
it would not bar respondent judge from issuing in Civil Case No. 64909 his
orders dated 30 March and 1 April 1966, subject matter of the supplemental
petition, as said restraining order was issued in connection with Civil Case No.
64831, a different and separate case. He also contended that neutral
employers or persons not involved in a labor dispute should not be made to
suffer the adverse effects of a picket directed against another.
The first question that strikes us to be of determinative significance to
this controversy is whether the two cases below involve, or grow out of, a
labor dispute. If they do, then, certainly, Section 9 of Republic Act No.
875 applies, otherwise, the converse is true. 4
A cursory examination of the record before us reveals that there exists
no labor dispute between petitioner PAFLU and either of the two complainants
in the court a quo, namely, Wellington in Civil Case No. 64831 and Galang in
Civil Case No. 64909. It is an admitted fact that the strike and the picket are
directed against METBANK, an entirely different and separate entity without
connection whatsoever with Wellington and Galang other than the incidental
fact that they are the bank's landlord and co-lessee in the Wellington Building,
respectively. Their relationship is so remote that we fail to discern any
indicium of said complainants' interests in the labor dispute between the union
and METBANK as to make the two cases below fall within the purview of
Section 2 of Republic Act No. 975 which provides that a labor dispute exist
"regardless of whether the disputants stand in the proximate relation of
employer and employee." In the case of Associated Watchmen and Security
Union (PTWO), et al., vs. United States Lines, et al. (supra), for example, we
found a "labor dispute" between the striking watchmen and the steamship
agency although the former (who were assigned to guard the latter's ships)
were contracted for by a watchmen agency because, in the last analysis, their
services were availed of and their compensation paid by the steamship
agency. We find no analogous nexus between the parties in the instant case.
And the convenient inclusion of METBANK as one of the present respondents
does not, to our mind, provide the necessary link between said parties as to
transform this into a labor dispute case.
The applicable law, therefore, is Rule 58 of the Rules of Court on
injunction. 5 Section 4 thereof reads:
"SECTION 4. Verified complaint and bond for preliminary
injunction. — A preliminary injunction may be granted only when:
"(a) The complaint in the action is verified, and shows facts
entitling the plaintiff to the relief demanded, and
"(b) The plaintiff files with the clerk or judge of the court in which
the action is pending a bond executed to the party enjoined, in an
amount to be fixed by the court, to the effect that the plaintiff will pay to
such party all damages which he may sustain by the reason of the
injunction if the court should finally decide that the plaintiff was not
entitled thereto." (Emphasis supplied.)
We have also examined the complaints filed in the lower court and
found the same as both verified and showing facts that entitled plaintiffs to the
relief demanded.
The right to picket as a means of communicating the facts of a labor
dispute is a phase of the freedom of speech guaranteed by the
constitution. 6 If peacefully carried out, it can not be curtailed even in the absence
of employer-employee relationship. 7
The right is, however, not an absolute one. While peaceful picketing is
entitled to protection as an exercise of free speech, we believe that courts are
not without power to confine or localize the sphere of communication or the
demonstration to the parties to the labor dispute, including those with related
interest, and to insulate establishments or persons with no industrial
connection or having interest totally foreign to the context of the
dispute. 8 Thus the right may be regulated at the instance of third parties or
"innocent bystanders" if it appears that the inevitable result of its exercise is to
create an impression that a labor dispute with which they have no connection
or interest exists between them and the picketing union 9 or constitute an
invasion of their rights. 10 In one case 11 decided by this Court, we upheld a
trial court's injunction prohibiting the union from blocking the entrance to a
feed mill located within the compound of a flour mill with which the union had
a dispute. Although sustained on a different ground, no connection was found
between the two mills owned by two different corporations other than their
being situated in the same premises. It is to be noted that in the instances
cited, peaceful picketing has not been totally banned but merely regulated.
And in one American case, 12 a picket by a labor union in front of a motion
picture theater with which the union had a labor dispute was enjoined by the
court from being extended in front of the main entrance of the building
housing the theater wherein other stores operated by third persons were
located.
The present case squarely fits into the foregoing legal setting.
Wellington and Galang are mere "innocent bystanders." They are entitled to
seek protection of their rights from the courts and the courts may, accordingly,
legally extend the same. Moreover, PAFLU's right to peacefully picket
METBANK is not curtailed by the injunctions issued by respondent judge. The
picket is merely regulated to protect the rights of third parties. And the reason
for this is not farfetched. If the law fails to afford said protection, men will
endeavor to safeguard their rights by their own might, take the law in their
own hands, and commit acts which lead to breaches of peace, bloodshed,
and ultimately the final subversion of the law. This should not be allowed to
happen.
In Thornhill vs. Alabama, 36 L. Ed. 1143, the United States Supreme
Court had occasion to rule on this question:
"'It is true that by peaceful picketing workingmen communicate
their grievances. As a means of communicating the facts of a labor
dispute may be a phase of the constitutional right of free utterance. But
recognition of peaceful picketing as an exercise of free speech does not
imply that the states must be without power to confine the sphere of
communication to that directly related to the dispute. Restriction of
picketing to the area of the industry within which a labor dispute arises
leaves open to the disputants other traditional modes of
communication. To deny to the states the power to draw the line is to
write into the constitution the notion that every instance of peaceful
picketing — anywhere and under any circumstances — is necessarily a
phase of the controversy which provoked the picketing. Such a view of
the due process clause would compel the states to allow the disputants
in a particular industrial episode to conscript neutrals having no relation
to either the dispute or the industry in which it arose.
"'In forbidding such conscription of neutrals in the circumstances
of the case before us, Texas represents the prevailing, and probably the
unanimous policy of the states. 13 We hold that the constitution does
not forbid Texas to draw the line which has been drawn here. To
hold otherwise would transmute vital constitutional liberties into
doctrinal dogma. We must be mindful that 'the rights of employers
 and employees to conduct their economic affairs and to compete
with others for a share in the products of industry are subject to
modification or qualification in the interests of the society in which
they exist. This is but an instance of the power of the State to set
the limits of permissible contest open to industrial combatants.'
Thornill v. Alabama, 310 U.S. 88, 103, 84 L. ed. 1093, 1102, 1103,
60 S. Ct. 736. [315 U.S. 722, at 727-728, 86 L. ed. 1143, at 1147-
1148, (1942)] (Emphasis supplied)'"
While we concede, however, that Wellington and Galang are entitled to
injunctions, we are constrained to annul the same. There is no question that
the Court of First Instance of Manila has jurisdiction over Civil Cases Nos.
64831 and 64909 because they are purely injunction suits and outside the
scope of Republic Act No. 875. But the issuance of the injunctions is attended
by irregularity and, as far as the second injunction is concerned, by violation
of our restraining order dated 30 March 1966.
There is a failure on the part of respondent judge to require Wellington
and Galang to file the necessary bonds before issuing the two preliminary
injunctions. The filing of said bonds is a mandatory requirement. 14 This is
evident in Section 4 of Rule 58 elsewhere quoted. It provides that "(a)
preliminary injunction may be granted only when: (a) The complaint. . .is
verified, and shows facts entitling the plaintiff to the relief demanded; and (b)
the plaintiff files. . .a bond executed to the party enjoined . . ." Such failure,
being a disregard of plain legal mandate, amounts to a grave abuse of
discretion.
IN VIEW OF THE FOREGOING, certiorari is hereby granted annulling
the two preliminary injunctions issued below, without prejudice to the right of
respondents Wellington and Galang to secure other ones a
(Philippine Association of Free Labor Unions v. Cloribel, G.R. No. L-25878,
|||

[March 28, 1969], 137 PHIL 287-298)

[G.R. No. L-19778. September 30, 1964.]

CROMWELL COMMERCIAL EMPLOYEES AND LABORERS

UNION (PTUC), petitioner, vs. COURT OF INDUSTRIAL
RELATIONS and CROMWELL COMMERCIAL CO.,
INC., respondents.
 Vicente T. Ocampo for petitioner.
Jalandoni & Jamir for respondent Cromwell Commercial Company, Inc.
Vidal C. Magbanua for respondent Court of Industrial Relations.

SYLLABUS

1. COURT OF INDUSTRIAL RELATIONS; UNFAIR LABOR PRACTICE

CASES; POWER TO ORDER REINSTATEMENT OF STRIKERS WITH OR
WITHOUT BACKPAY; TWO TYPES OF EMPLOYEES INVOLVED. — Two
types of employees involved in unfair labor practice cases should be
distinguished, namely, those who were discriminatorily dismissed for union
activities and those who voluntarily went on strike even if it is in protest of an
unfair labor practice. Both types of employees are entitled to reinstatement.
2. ID.; ID.; ID.; EXCEPTION TO RULE; EMPLOYEES GUILTY OF
UNLAWFUL CONDUCT OF VIOLENCE. — From the rule that employees
who strike because of unfair labor practice are entitled to reinstatement,
however, must be excepted those who, although discriminatorily discharged,
must nevertheless be denied reinstatement because of (1) unlawful conduct
or (2) because of violence.
3. ID.; ID.; ID.; ID.; C.I.R. TO DETERMINE EFFECT OF MISCONDUCT
OF STRIKERS. — It is not for the Supreme Court to judge the effect of
misconduct by the striking employees. That is primarily for the Court of
Industrial Relations to determine.
4. ID.; ID.; ID.; ID.; C.I.R. TO DETERMINE WHETHER STRIKERS
WHO FOUND OTHER EMPLOYMENT SHOULD BE REINSTATED. — It is
for the Court of Industrial Relations to determine primarily whether to deny
reinstatement to those of the strikers who might have found substantial
employment elsewhere.
5. ID.; ID.; ID.; DISCRIMINATORILY DISMISSED EMPLOYEES TO
RECEIVE BACKPAY. — Discriminatorily dismissed employees receive back
pay from the date of the act of discrimination, that is from the day of their
discharge.
6. ID.; ID.; ID.; VOLUNTARY STRIKERS NOT ENTITLED TO
BACKPAY. — Those employees who voluntarily went on strike even if in
protest against what they considered unfair labor practices of the company
are not entitled to backpay. The stoppage of their work was not the direct
consequence of the company's unfair labor practice. Hence, their economic
loss should not be shifted to the employer. (See Dinglasan vs. National Labor
Union, 106 Phil., 671).
 7. ID.; ID.; ID.; OFFER TO RETURN TO WORK MUST BE
UNCONDITIONAL TO ENTITLE STRIKERS TO BACKPAY UPON REFUSAL
OF EMPLOYER TO READMIT THEM. — To be effective so as to entitle the
strikers to backpay, the offer must have been unconditional. The strikers must
have offered to return to work under the same conditions under which they
worked just before their strike so that the company's refusal would have
placed on the latter the blame for their economic loss.
8. LABOR RELATIONS; HALF BACK WAGES TO REINSTATED
EMPLOYEES HELD PROPER WHILE THEIR ACTS ARE NOT FULLY
JUSTIFIED. — Half backwages instead of full backwages to some of the
reinstated employees is proper where said employees who were salesmen
were not exactly justified in refusing to turn over their collections to the
company.
9. ID.; NO BACKPAY IN VOLUNTARY STRIKE EVEN IF IN PROTEST
AGAINST UNFAIR LABOR PRACTICE; EXCEPTION WHERE STRIKERS
ABANDON STRIKE BUT ARE REFUSED REINSTATEMENT. — Those who
strike voluntarily, even if in protest of unfair labor practice, are entitled to
backpay only, when the strikers abandon the strike and apply for
reinstatement despite the unfair labor practice and the employer either
refuses to reinstate them or imposes upon their reinstatement new conditions
that constitutes unfair labor practice.

DECISION

REGALA, J : p

On July 10, 1956, Cromwell Commercial Co. and the Cromwell

Commercial Employees and Laborers Union (PTUC) signed a collective
bargaining agreement which provided, among other things, for the following:
"3. The Company agrees to consider as permanent
employees and workers all those who have rendered three (3)
months continuous, satisfactory service, and as such shall be
entitled to all privileges enjoyed by all permanent and regular
employees; provided, however, that the COMPANY reserves the
right to dismiss any employee for cause;"
"6. A 'Grievance Committee' composed of three (3)
representatives appointed by the COMPANY and three (3) UNION
members elected by the UNION shall be immediately constituted.
This Committee shall meet not more than once a week as may be
called by proper notice of any three (3) members of said committee
 to hear and decide any differences on labor-management relations.
The committee shall hear the grievance and the witnesses of the
parties concerned, if any, and shall submit its recommendation to
the President of the COMPANY who shall decide the same, within
thirty (30) days from transmittal of said recommendation by the
President's representative in the Philippines:
"7. Considering that the COMPANY has put into effect,
effective April 16, 1956, a minimum wage of P140.00 a month to
permanent employees in its office and has given merit increase to a
few others, the COMPANY agrees in principle to the demand of the
UNION for a general increase of salaries and wages, if the financial
position of the COMPANY shows that it can afford to give an
increase after the second quarter of 1956 but reserves its decision
as to the amount. The COMPANY further reserves its right as to
whether to give or not to give increases to those who already
received merit increases effective April 16, 1956, provided,
however, that those whose salaries were slashed in 1956 and were
restored on April 16, 1956, shall not be considered as having
received a merit increase;"
"10. That the COMPANY shall restore all salesmen to the
status of salary basis effective May 1, 1956 and shall also restore
the helpers allowance of provincial salesmen effective the same
date;"
"12. The COMPANY agrees in principle to consider the
giving of a share of its profits to its employees and workers, the
amount and the time to depend in the sale discretion of the
management of the COMPANY."
However, it appears that, contrary to paragraph 7, the company gave
no salary increase to its employees, except to three who were not union
members, despite the fact that it had made a P90,000 profit at the close of the
second quarter of 1956.
With respect to paragraph 10 of the agreement, it appears that
salesmen of the company used to be paid on a straight salary basis. Some
were receiving P300, others P320 while still others were getting P350 a
month. In addition, those assigned to the provinces were given a so-called
helper's allowance of P120 a month, a per diem of P8 and an allowance for
postage and other expenses incurred in remitting their collections. For some
reason, however, the company reduced the salary of salesmen to P200 a
month and their helper's allowance from P120 to P60 a month, although it
paid them a commission of 1 per cent of their collections.
This is the reason why paragraph 10, which provided for the restoration
of cuts in the salaries and allowances of salesmen, was inserted in the
agreement. But instead of restoring the salaries in full, the company merely
paid P300 even to those who, before salaries were reduced, were already
receiving P320 or P350 a month. The so-called helper's allowance, which as
already stated had been reduced from P120 to P60 a month, was not restored
at all.
What is worse, effective March 1, 1957, the company reverted all
salesmen to salary and commission basis, stopped their helper's allowance
altogether and discontinued the payment of per diem and other allowances to
provincial salesmen, so much so that the latter found themselves again in the
same situation they were in before the signing of the collective bargaining
agreement. Worst of all, the company increased the quotas of some salesmen
and threatened them with dismissal if they could not fill their quotas.
These changes in the working conditions in the company and the
latter's failure to carry out its part of the agreement became a source of
complaint among the employees. But beyond promising that the matter would
be looked into as soon as its President arrived from the United States, the
company did nothing. The grievance machinery set up in the agreement could
not function on account of the company's- refusal to name its representatives
in the committee.
Meanwhile, daily wage employees in the shipping department began
agitating for the application of paragraph 10 to them. In a letter sent to the
company on March 2, 1957, Jose J. Hernandez of the Philippine Trade Union
Council asked that these employees be put on a monthly salary basis. He
also called attention to the failure of the company to send representatives to
the grievance committee.
Three days after, the company dismissed Francisco Gaddi and
Cresenciano Andrada, leaders of the shipping department employees. And so
on March 7, the union dispatched another letter to the company, calling
attention to the contents of its March 2 letter and protesting the dismissal of
Gaddi and Andrada. It gave the company 48 hours within which to act on its
grievance and reinstate the dismissed employees.
On March 6, the company President replied, stating in part that —
". . . Effective March 1st, I reduced all salesmen's salaries, I
discontinued the helper's allowance and, in the case of provincial
salesmen, I discontinued the payment of any per diems."
In another letter sent the following day, the company explained that the
relief of Gaddi and Andrada was in line with its policy of laying off extra
employees.
From then on the relation between the company and the union steadily
deteriorated.
 On March 8, the company took back the keys from the warehouseman
and ordered the salesmen to put their trucks in the garage.
On March 9, the parties met to resolve their differences only to part
ways later — still poles apart.
Finally, on March 11, the union struck and picketed the premises of the
company.
The company in turn gave the strikers until 8 a.m. of March 14, 1957
within which to return to work otherwise they would be considered dismissed
for cause. It warned them that the strike was illegal for being against the no-
strike clause of the collective bargaining agreement.
In a conference called by the Department of Labor, the strikers offered
to return to work provided the company observed the provisions of the
bargaining contract. But the company insisted that the strikers could be taken
back only under the terms of its March 1 order. As already stated, this order
reverted salesmen to salary and commission basis, abolished their helper's
allowance and stopped the payment of per diem and other allowances to
provincial salesmen.
In addition, the company set as price for continued conciliation
conference the remittance by the salesmen of their collections and the return
of delivery trucks and stocks on hand. The union replied that the strikers had
not lost their employee status and that at any rate they were bonded. It
offered though to deposit with the Conciliation Service of the Department of
Labor the things demanded by the company, but the company was unyielding
in its demand. Anyway, nothing came out of the conference. The employees
gradually gave up the strike and the salesmen later settled their accounts and
returned the property of the company.
On September 19, 1957 this case was filed in the Court of Industrial
Relations, charging the company, together with its President and Vice
President, with unfair labor practice. After trial, the court rendered judgment
as follows:
"IN VIEW OF ALL THE FOREGOING, the Respondent and
all its officers and agents are hereby ordered:
"(1) To cease and desist from:
a) refusing to bargain collectively in good faith with the
Union.
b) refusing to bargain collectively in good faith with
respect to the grievance of the Union by
appointing its representatives to the grievance
committee as provided for in the said agreement.
 c) making changes in the working conditions of the
salesmen who are members of the Union with
respect to their salaries and the helper's
allowance of provincial salesmen without
complying with the requirements of Sec. 13
of Republic Act 875.
"(2) To take the following affirmative acts which the Court finds
will effectuate the policy of the Act:
a) to reinstate Francisco Gaddi with half back pay from
March 5, 1957 to actual data of his
reinstatement, minus whatever salaries he might
have earned during the pendency of this case,
unless he has found a substantial employment
elsewhere. And with respect to Cresenciano
Andrada, his one half back wages shall be from
March 5, 1957 until the date he committed illegal
acts in the picket line. Angel Dario is not entitled
to reinstatement.
b) to reinstate salesmen Antonio Jacinto, Celestino
Gualberto, Constantino Atienza, Elias Berrova,
and Pedro del Rosario with half back wages from
the date they have cleared their accountabilities
or responsibilities with the Company, minus what
they have earned during the pendency of the
dispute unless they have found substantial
employment elsewhere. The case of Teofilo
Nuñez is dismissed as heretofore indicated. With
respect to Roberto Dijamco as also mentioned,
there is a pending separate unfair labor practice
in the Court (Case No. 1271-ULP).
c) To reinstate all the strikers listed in Annex 'A' of the
complaint, without backwages, in view of the
circumstances, as explained on the subject of
the strike, unless they have found substantial
employment elsewhere during the pendency of
this case.
"In addition, respondent is hereby ordered to post a copy of
this order in the company's bulletin board, if any or in default
thereof, in any conspicuous place at company's premises and
report to the Court as soon as possible its compliance."
The union moved for a reconsideration of the decision, contending that
the trial judge erred (1) in awarding only half back wages to Francisco Gaddi
and the five salesmen, (2) in awarding no back wages to the rest of the
strikers and (3) in denying reinstatement to Cresenciano Andrada and Angel
Dario and to those who might have found substantially equivalent employment
elsewhere. The court en banc affirmed the decision. Hence, this appeal.
The issues in this appeal relate to the power of the Court of Industrial
Relations to order reinstatement and the payment of back wages in unfair
labor practice cases as a means of effectuating the policy of the law.
Section 5 (c) of the Industrial Peace Act states:
". . . If, after investigation, the Court shall be of the opinion
that any person named in the complaint has engaged in or is
engaging in any unfair labor practice, then the Court shall state its
findings of fact and shall issue and cause to be served on such
person an order requiring such person to cease and desist from
such unfair labor practice and take such affirmative action as will
effectuate the policies of this Act, including (but not limited to)
reinstatement of employees with or without back-pay and including
rights of the employees prior to dismissal including seniority. . . "
At the outset, two types of employees involved in this case must be
distinguished, namely, those who were discriminatorily dismissed for union
activities and those who voluntarily went on strike. To the first class belong
Francisco Gaddi and Cresenciano Andrada, both of whom, as earlier shown,
had been dismissed for union activities, and the five salesmen who were
virtually locked out by the company when they were ordered to put their trucks
in the garage. To the second class belong those who declared a strike on
March 11, 1957, following the failure of the company-union conference to
settle their dispute.
Both types of employees are entitled to reinstatement. Indeed, it is said
that striking employees are entitled to reinstatement whether or not the strike
was the consequence of the employer's unfair labor practice, unless, where
the strike was not due to any unfair labor practice, the employer has hired
others to take the place of the strikers and has promised them continued
employment. (Teller, 2 Labor Disputes and Collective Bargaining, Sec. 371,
pp. 396-397).
From this rule, however, must be excepted those who, although
discriminatorily discharged, must nevertheless be denied reinstatement
because of (1) unlawful conduct or (2) because of violence. For while the
Court of Industrial Relations has indeed discretion in determining the remedy
in case of unfair labor practice, its discretion is not unbounded. (Big Five
Products Workers Union-CLP vs. Court of Industrial Relations, et al., G.R. No.
L-17600, July 31, 1963) It cannot exercise its right beyond the point which the
object of "effectuation" of the Act requires. It can not order the reinstatement
of those convicted of violence upon the employer's property. (Rothenberg on
Labor Relations, 573-574; Philippine Education Co., Inc. vs. Court of Industrial
Relations, et al., G.R. No. L-7156, May 31, 1955; Consolidated Labor Ass'n.
of the Phils. vs.Marsman & Co., Inc., et al., G.R. No. L-17038, July 31, 1964)
Such is the case of Cresenciano Andrada and Angel Dario who were
found guilty of acts of violence consisting of hurling stones which smashed
glass windows of the building of the company and the headlights of a car and
the utterance of obscenities such as "Putang ina."
But the union contends that the acts committed by Andrada and Dario
were not so serious as to call for the forfeiture of their rights to reinstatement.
It is not for Us to judge the effect of misconduct by employees. That is
primarily for the Court of Industrial Relations to determine. (See
NLRB vs. Weissman Co., 170 F(24) 952). In the absence of proof of abuse of
discretion on the part of the Court of Industrial Relations, this Court will not
interfere with the exercise of that discretion.
The same thing may be said of the denial of reinstatement to those who
might have found substantial employment elsewhere. We agree with the
union that under the ruling of Phelps Dodge Corp. vs. NLRB, 313 U.S. 177, 85
L, ed. 1271 (See also Cox and Bok, Cases on Labor Law, 259, 5th ed.), the
mere fact that strikers or dismissed employees have found such employment
elsewhere is not necessarily a bar to their reinstatement. 1 But it is just as true
to say that the Phelps Dodgecase did not rule that in any
event discriminatorily dismissed employees must be ordered reinstated even
though they have in the meanwhile found substantially equivalent employment
somewhere else. While denying that employees who have obtained
equivalent employment are ineligible as a matter of law to reinstatement, the
Supreme Court of the United States at the same time denied also that the
definition of the term "employee" can be disregarded by the National Labor
Relations Board in exercising its powers under Section 10(c) of the Wagner
Act, which corresponds to Section 5 (c) of ourIndustrial Peace Act, to direct
the taking of affirmative action by an employer to remedy unfair labor
practices. According to the Court, it is for the Board in each case to weigh the
particular facts and to determine, in the exercise of wise administrative
discretion, whether the Act would best be effectuated by directing
reinstatement despite the fact that the given employee has found equivalent
employment.
Obviously it was after considering the facts in this case that the Court of
Industrial Relations predicated the reinstatement of the employees concerned
on the fact that they had not found substantially equivalent employment
elsewhere. Thus, it made clear in the dispositive portion of its decision that it
was ordering the taking of affirmative acts "which the Court finds will
effectuate the policy of the Act." The union has not shown that in so doing the
Court of Industrial Relations abused its discretion.
Coming now to the question of backpay, the decision under review
directs the company "to reinstate all the strikers listed in Annex 'A' of the
complaint, without back wages, in view of the circumstances, as explained on
the subject of the strike, unless they have found substantial employment
elsewhere during the pendency of this case." The union assails this order as
erroneous. According to the union, it is unfair to deny backwages to the
strikers after finding that the strike declared by them was legal because it was
provoked by unfair labor practices of the company. Indeed a reading of the
46-page decision of the Court of Industrial Relations fails to yield the reason
that impelled the court to deny backwages to the strikers.
Nevertheless, We believe that the denial of backpay may be justified,
although on a different ground. For this purpose, We shall advert again to the
distinction earlier made between discriminatorily dismissed employees and
those who struck, albeit in protest against the company's unfair labor practice.
Discriminatorily dismissed employees receive back pay from the date of the
act of discrimination, that is from the day of their discharge. On this score, the
pay from the date of the act of discrimination, that is from the day of their
discharge. On this score, the award of backpay to Gaddi, Andrada and the
salesmen may be justified. The salesmen, as already stated, were practically
locked out when they were ordered to put their trucks in the garage; they did
not voluntarily strike. (See Macleod & Co. of the Phils. vs. Progressive
Federation of Labor, G.R. No. L-7887, May 31, 1955) Hence, the award of
backwages.
In contrast, the rest of the employees struck as a voluntary act of
protest against what they considered unfair labor practices of the company.
The stoppage of their work was not the direct consequence of the company's
unfair labor practice. Hence their economic loss should not be shifted to the
employer. (See Dinglasan vs. National Labor Union, G.R. No. L-14183, Nov.
28, 1959). As explained by the National Labor Relations Board in the case of
American Manufacturing Co., 5 NLRB 443, "When employees voluntarily go
on strike, even if in protest against unfair labor practices, it has been our
policy not to award them back pay during the strike. However, when the
strikers abandon the practices and the employer either refuses to reinstate
them or imposes upon their reinstatement new conditions that constitute
unfair labor practices, We are of the opinion that the considerations impelling
our refusal to award back pay are no longer controlling. Accordingly, We hold
that where, as in this case, an employer refuses to reinstate strikers except
upon their acceptance of new conditions that discriminate against them
because of their union membership or activities, the strikers who refuse to
accept the conditions and are consequently refused reinstatement are entitled
 to be made whole for any losses of pay they may have suffered by reason of
the respondent's discriminatory acts." (Quoted in Teller, 2 Labor Disputes and
Collective Bargaining Sec. 371, pp. 997-998)
While it is true that the strikers in this case offered to return to work on
March 14, 1957, We find that their offer was conditional. Their offer was
predicated on the company's observance of the provisions of the collective
bargaining agreement — the very bone of contention between the parties by
reason of which the union walked out. To be effective so as to entitle the
strikers to backpay, the offer must have been unconditional. The strikers must
have offered to return to work under the same conditions under which they
worked just before their strike so that the company's refusal would have
placed on the latter the blame for their economic loss. But that is not the case
here. Indeed the offer of the company to accept the strikers under the
conditions obtaining before the strike (without prejudice of course to taking up
the grievances of the strikers) can be considered in its favor in denying
backwages to strikers. (Dinglasan vs. National Labor Union, G. R. No. L-
14183, Nov. 28, 1959.)
Nor may it be said that the strikers could not have offered to return to
work because the company dismissed them upon their failure to return to
work on March 14, 1957. For the notice given by the company was merely a
"tactical" threat designed to break the strike and not really to discharge the
striking employees. (Majestic Mfg. Co., et al., 64 NLRB 961; Rockwood Stove
Works, 63 NLRB 1297; American Mfg Co., 7 NLRB 553)
WHEREFORE, the decision and resolution of the Court of Industrial
Relations appealed from are hereby affirmed, without pronouncements as to
costs.
Bengzon, C.J., Bautista Angelo, Paredes, Dizon, Makalintal, Bengzon,
J .P. and Zaldivar, JJ., concur.
(Cromwell Commercial Employees and Laborers Union v. Court of Industrial
|||

Relations, G.R. No. L-19778, [September 30, 1964], 120 PHIL 918-937)

[G.R. No. L-10327. September 30, 1958.]

UNITED EMPLOYEES WELFARE ASSOCIATION, petitioner, vs.

ISAAC PERAL BOWLING ALLEYS, respondent.
 Jose C. Concepcion for petitioner.
Felix S. Falgui for respondent.

SYLLABUS

1. EMPLOYER AND EMPLOYEE; BACKPAY; RIGHT TO BACKPAY

NOT ABSOLUTE BUT SUBJECT TO DISCRETION OF INDUSTRIAL
COURT. — The right to backpay is not absolute but subject to the discretion
of the Court of Industrial Relations. Being empowered — by section 5 (c)
of Republic Act 875 — to order the reinstatement of an employee "with or
without backpay", that court must be deemed to have also the lesser power of
mitigating the backpay where backpay is allowed.
2. ID.; ID.; MITIGATION OF BACKPAY; CASE AT BAR. — In the case
at bar, appellant Union contends that the dismissed pinboys were entitled to
back wages until actually reinstated and not only up to the day the case was
submitted for decision. However, it appears that there was a long delay in the
disposal of the case and the Industrial Court was aware that the financial
condition of the bowling alleys was not very sound. These circumstances call
for the mitigation of backpay and the Industrial Court committed no error in
allowing backpay only up to the day the case was submitted for decision.

DECISION

REYES, J : p

This is an appeal by certiorari from an order of the Court of Industrial

Relations.
On October 10, 1952, thirty-six pinboys of the Isaac Peral Bowling
Alleys, an enterprise owned and operated by the Philippine Advertising
Corporation, declared a strike for the reasons stated in a petition filed in their
behalf by their Union (the United Employees Welfare Association) with the
Department of Labor. But through the mediation of the Court of Industrial
Relations to which the case was certified and where it was docketed as Case
No. 751-V, the parties entered into a temporary agreement on the basis of
which that court issued an order on October 22, 1952, providing that —
". . . members of petitioning union, during pendency of case, are
enjoined not to declare any strike, and respondent on the other hand, is
refrained from accepting new pinboys other than those whose names
appear in abovementioned payrolls without express authority of Court,
 and shall permit under last terms and conditions existing before the
strike of October 10, 1952, continuation of the 36 pinboys in the service."
In view of this order, the striking pinboys immediately returned to work.
But on November 11, 1952, with the said case No. 751-V still pending
trial, the management of the bowling alleys dismissed four of the pinboys,
named Ramon Arevalo, Claro Bordones, Petronio Beriña and Carlos
Menodiado "on grounds of grave and willful insubordination . . . and grave
misconduct" and on the further ground of "drunkenness" in the case of the last
two.
Alleging that the dismissal was a violation of the above order, the Union
filed a motion to declare the manager and directors of the bowling alleys guilty
of contempt, later a ending, the motion by also asking that the dismissed
pinboys be reinstated with backpay.
After hearing, the court handed down its order, dated December 9,
1955, denying the motion for contempt but ordering the reinstatement of the
four pinboys —
" . . . with back wages from November 11, 1952 up to December
22, 1954 when this case was submitted for decision. Provided, however,
that such back wages shall be based on the average earnings of each
and every one of said 4 pinboys one month prior to their dismissal, or on
November 11, 1952."
Not satisfied with the above order, both parties sought relief from this
Court, one through a petition for certiorari and the other through appeal by
certiorari. The petition for certiorari, which is that filed by the bowling Alleys,
assails the order in so far as it directs the reinstatement of the pinboys and
awards them backpay. On the other hand, the appeal by the other party, the
Union, rests on the contention that the order was erroneous (1) in so far as it
allows back wages only up to the date the case was submitted for decision
and (2) in so far as it directs that the back wages shall be based on the
dismissed pinboys average earnings "one month prior to their dismissal.
The petition for certiorari filed by the Bowling Alleys having been
already dismissed for lack of merit (See resolution dated March 21, 1956 in G.
R. No. L-10331), the order complained of is now before us only for the
purposes of the appeal interposed by the Union.
With reference to the first ground of appeal, it is the contention of the
appellant Union that the dismissed pinboys were entitled to back wages until
actually reinstated and not only up to the day the case was submitted for
decision. This contention fails to reckon with the fact that the right to backpay
is not absolute but subject to the discretion of the Industrial Court (Antamok
Goldfields Mining Company vs. Court of Industrial Relations, et al., 70 Phil.
340; Union of Philippine Education Employees vs. Philippine Education
 Company, 91 Phil., 93). Being empowered — by section 5 (c) ofRepublic Act
875 — to order the reinstatement of an employee 'with or without backpay",
that court must be deemed to have also the lesser power of mitigating the
backpay where backpay is allowed. And we note that in the present case
there are circumstances calling for mitigation. For it appears that there was a
long delay in the disposal of the case — decision did not come down until one
year after the case was submitted — and as we had occasion to note in our
decision in the main case (102 Phil., 219) the Industrial Court was aware that
the financial condition of the bowling alleys was "not very sound due to losses
reported during the years 1952-1953." In view of those circumstances, we are
not for disturbing the order appealed from in so far as it allows backpay only
up to the day the case was submitted for decision.
We are, however, with the appellant in the view that in determining the
earnings of the dismissed pinboys for the month preceding their dismissal,
account must be taken of the fact that the pinboys were on strike for 12 days
of that month. The order below must, therefore, be clarified in the sense that
the month referred to means a full working month,i.e., excluding the period of
the strike, so that the backpay awarded to the dismissed pinboys is to be
based on their earnings for such month.
With this only clarification, the order appealed from is affirmed, without
pronouncement as to costs.
(United Employees Welfare Association v. Isaac Peral Bowling Alleys, G.R. No.
|||

L-10327, [September 30, 1958], 104 PHIL 640-643)

[G.R. No. L-17038. July 31, 1964.]

CONSOLIDATED LABOR ASSOCIATION OF THE

PHILS., petitioner, vs. MARSMAN & CO., INC., and the COURT
OF INDUSTRIAL RELATIONS, respondents.

[G.R. No. L-17057. July 31, 1964.]

MARSMAN & CO.

INC., petitioner, vs. CONSOLIDATED LABOR ASSOCIATION OF
THE PHILIPPINES, HON. JOSE S. BAUTISTA, HON. ARSENIO
I. MARTINEZ, HON. BALTAZAR M. VILLANUEVA, and HON.
EMILIANO C. TABIGNE, respondents.
 Salvador H. Laurel and Apolonio V. Santiago for petitioner.
Jose C. Espinas & Associates for
respondent Consolidated Labor Association of the Philippines.
CIR Legal Division for respondent Judges.

SYLLABUS

1. LABOR RELATIONS; UNFAIR LABOR PRACTICE; REFUSAL TO

READMIT STRIKERS BECAUSE OF UNION ACTIVITIES. — The denial of
readmittance to striking employees not because of business exigency but due
to a desire to discourage union activities in unfair labor practice on the part of
the employer.
2. SAME; SAME; RIGHT OF REINSTATEMENT SHOULD NOT BE
DENIED TO EMPLOYEES INNOCENT OF ILLEGAL ACTS AGAINST
COMPANY. — Where it appears that illegal acts committed by individual
strikers against the company were neither authorized nor impliedly sanctioned
by the union, the other strikers who were innocent of and did not participate in
said acts should not be punished by being deprived of their right of
reinstatement.
3. SAME; ECONOMIC STRIKE; NO RIGHT TO BACKPAY. — In an
economic strike, the strikers are not entitled to backpay, since the employer
should get the equivalent days work for what he pays his employees.
4. SAME; SAME; DEFINITION OF ECONOMIC STRIKE. — An
economic strike is defined as one which is to force wage or other concessions
from the employer which he is not required by law to grant.
5. SAME; SAME; WHEN CHANGED TO UNFAIR LABOR PRACTICE
STRIKE. — An economic strike changes in character to one for
unfair labor practice from the time a company refuses to reinstate some of its
striking employees because of their union activities after it had offered to
readmit all the strikers and in fact did readmit the others.

DECISION

MAKALINTAL, J : p

In the Court of Industrial Relations, Marsman & Co., Inc., hereinafter

referred to as the Company, was charged with unfair labor practice committed
against sixty-nine officers and members of the Marsman & Company
Employees and Laborers Association (hereinafter referred to as MARCELA or
simply as the Union). The Court (Judge Jose S. Bautista), after hearing, found
the Company guilty of the charge and ordered it to reinstate 60 of the
aforementioned 69 complainants to their former positions or to similar ones
with the same rate of pay, without back wages. On motions for
reconsideration filed by the Union and by the Company, respectively, the
Court en banc affirmed the decision — with Judge Arsenio I. Martinez
concurring in the result; Judge Baltazar M. Villanueva concurring in the result
in a special opinion; Judge Emiliano C. Tabigne filing a separate concurring
and dissenting opinion; and Judge Amando C. Bugayong taking no part.
Both the Union and the Company appealed. The former claims that the
60 reinstated employees should be granted backpay (G.R. No. L-17038) while
the latter questions the Industrial Court's finding of unfair labor practice (G.R.
No L-17057).
The facts, as found by the Industrial Court, are: The Company had in its
employ approximately 320 persons, about 140 of whom were members of
MARCELA and about 20 of the National Labor Union. On December 23, 1953
the Industrial Court named MARCELA as the employees' bargaining agent in
regard to rates of pay, terms and conditions of employment. At that time
MARCELA was affiliated with the Federation of Free Workers, or FFW, a
national LaborOrganization. On March 17, 1954 MARCELA-FFW submitted to
the Company a set of proposals for collective bargaining, which the Company
answered on March 24, 1954. In spite of negotiations held between the
Company and the Union, they failed to reach an agreement; so on April 8,
1954 the Union filed a notice of strike with the Department of Labor. Mediation
by the Conciliation Service of that Department proved fruitless.
On June 4, 1954 the Union declared a strike and at the same time
placed a "round-the-clock" picket line around the Company's premises in
Intramuros, Manila. The tense situation in the strike zone prompted the Manila
Police Department to send policemen thereto to preserve peace. Meanwhile
the Labor Department's Conciliation Service continued to mediate between
the representatives of the Union and of the Company.
On July 21, 1954 some 50 employees, of whom nine were members of
the National Labor Union and one a member of MARCELA, entered the
Company premises under police escort in order to return to work.
On July 30, 1954, in a conference called by Eleuterio Adevoso, then
Secretary of Labor, the Union officials and members then present were
prevailed upon by Adevoso to accept the proposal of Antonio de las Alas,
Company vice-president, that they stop the strike and go back to work, and
that when they were already working the company would discuss with them
their demands. Upon being informed of the Union's acceptance of the
proposal the strikers returned to work. The Company admitted back sixteen
picketing strikers on August 9, 1954 and later on, it also reemployed non-
union employees and a majority of the strikers. However, complainants herein
were refused admittance and were informed by Company officials that they
would not be reinstated unless they ceased to be active Union members and
that in any case the Company already had enough men for its business
operations.
As a result the strike and the picketing were resumed, because of which
employees who had been admitted to work since July 21, 1954 had to stay
inside the Company premises, where the Company furnished them food and
quarters up to October 1954. Nevertheless some of those employees could
go in and out after office hours to visit their families.
During the strike, some of the picketers and some non-strikers were
arrested within the strike zone for having committed unlawful acts, and were
duly charged therewith.
A petition for writ of injunction filed by the Company against MARCELA
and its president, Buenaventura Bacay, on the ground that the strike and
picket were being maintained illegally, was denied by the Court of First
Instance of Manila, which pointed out that proper criminal complaints should
have been filed against the individual strikers in the corresponding courts.
Because of the Company's consistent refusal to reinstate the 69
complainants even after repeated requests, the Confederation
of Labor Associations of the Philippines (CLAP), to which the Union had
affiliated after seceding from the FFW, initiated the present charge for
unfair labor practice.
Initially the strike staged by the Union was meant to compel the
Company to grant it certain economic benefits set forth in its proposal for
collective bargaining. The strike was an economic one, 1 and the striking
employees would have a right to be reinstated if, in the interim, the employer
had not hired other permanent workers to replace them. For it is recognized
that during the pendency of an economic strike an employer may take steps
to continue and protect his business by supplying places left vacant by the
strikers, and is not bound to discharge those hired for that purpose upon
election of the strikers to resume their employment. 2 But the strike changed
its character from the time the Company refused to reinstate complainants
because of their union activities after it had offered to admit all the strikers and
in fact did readmit the others. It was then converted into an
unfair labor practice strike.
The Company disputes the Industrial Court's findings that (1) it offered
to reinstate all the strikers; (2) the complainants made a timely acceptance of
the offer; and (3) the Company's refusal to reinstate complainants was for the
purpose of discouraging union activities.
Substantial evidence supports the findings of fact of the Court of
Industrial Relations. Complainants Teodoro Bacalzo, Raymundo Mostoles-
Cruz, Mariano Bautista, and Godofredo Garcia testified thus: They were all
present at the July 30, 1954 conference called by then Labor Secretary
Eleuterio Adevoso in order to settle the differences between the Company
and the Union. It was during this conference that Antonio de las Alas, then the
Company's vice-president, offered to take back all the strikers if they would
only stop the strike and as further inducement promised that the Union's
demands would be discussed when the strikers were already working.
Adevoso convinced the Union Officers and members who were present to
accept De las Alas' proposal.
The lower court's reasons, we think, amply answer the Company's
contention that De las Alas could not, by his offer, have bound the Company
because it was Velilla, and not he, who had the authority to deal with the
strikers:
"The denial of respondent that Antonio de las Alas was not
authorized by the Company but Amando L. Velilla to deal with the union
with respect to the strike is not worthy of belief. First because then De
las Alas was an executive Vice-President while Velilla was only the
Secretary of the Company; second, while respondent wants to impress
this Court that Velilla's authority to deal with the strikers was by virtue of
the Board resolution, such document was not presented in Court; and
third not even De las Alas was presented to make the denial."
The Company claims that the complainants applied for readmission
only on June 7, 1955, more than a year after the offer, when the CLAP, in
their behalf, wrote the Company asking for their reinstatement. Prior to said
letter, however, complainants had, by various means, sought readmission.
After De las Alas' invitation to return to work was accepted by the Union
officers and members, they informed all the other strikers accordingly.
Thereupon the strikers terminated the strike and presented themselves for
work at the Company's premises. Eighty one of the strikers were allowed to
come back. But the Company's security guards, upon instructions of the
Company officials, barred the entrance when complainants attempted to
enter, and informed them that they had to write individual letters of
application. So complainants complied with this requirement. It appears that
the applications were scrutinized by a committee of employees composed of
Salvador Bantique, assistant accountant of the mines division; Mariano Lee,
purchasing agent; Juan de Vera, paymaster; and Regino Cruz, accountant.
Then the applications were further screened by a personnel committee
composed of Jan H. Marsman, Antonio de las Alas, Charles G. Herdman and
Amando Velilla. None of the sixty-nine applications met with favorable action
by either committee.

In addition to writing formal letters of application a member of the

complainants phoned while others personally approached their respective
chiefs of department in the Company. Some also went to see Salvador
Bantique, chairman of the screening committee, and expressed their desire to
work. Bantique, however, upon learning that the strikers, among them Eulogio
Labrador, were still active union members, informed them that they should
first disaffiliate from the union in order to be reinstated. Furthermore, Amando
Velilla, when approached by a group of complainants, told the latter that they
had been away for a long time; that the Company had enough employees and
did not need additional help; that some of those whom he had invited to return
refused; and that by that time (August, 1954) it was already too late for them
to wish to return.
The Company alleges that it was economic reasons, i. e., its policy of
retrenchment, not labor discrimination, which prevented it from rehiring
complainants. This is disproved, however, by the fact that it not only
readmitted the other strikers, but also hired new employees and even
increased the salaries of its personnel by almost 50%. We are convinced that
it was not business exigency but a desire to discourage union activities which
prompted the Company to deny readmittance to complainants. This is an
indubitable case of unfair labor practice.
The strike was illegal of purpose, the Company insists, first, because it
was staged for a trifling reason; and second, the union demands, which had
participated the strike, were already covered by an Industrial Court judgment,
for the alteration, modification or setting aside of which a certain procedure
has to be followed.
The Union began the strike because it believed in good faith that
settlement of their demands was at an impasse and that further negotiations
would only come to naught. It stopped the strike upon the belief they could go
back to work. Then it renewed the strike (or it started a new strike) as a
protest against the discrimination practiced by the Company. Both are valid
grounds for going on a strike.
It is true that on August 14, 1952 the Industrial Court promulgated a
decision in CIR Case No. 571-V, Marsman and Company Employees and
Laborer Association (MARCELA-FFW) vs. Marsman and Company, Inc.
However, except for demand for general salary increases, the demands in
said labor case were different from the demands which the Union made
before it went on strike. For this reason, it did not have to ask for modification
 of the aforementioned judgment. It had only to give the proper strike notice, as
in fact it did.
The Company further argues that since the methods used by the
strikers were illegal, it had the right to refuse them readmission. Of the 69
complainants, nine, namely Alejandro Mojar, Manuel Mazo, Esteban Borja,
Cecilio Walo, Eugenio Valenzuela, Elias Matic, Marcos Buccat, Malisimo
Vargas and Ricardo Antonio were charged with and convicted of various
crime like coercion, malicious mischief, physical injuries, breach of the peace,
light threats, and damage to property, all committed during the period from
September 4, 1954 to October 12, 1954. Admittedly, the Company could not
have condoned those acts which were committed after it had offered to
reinstate the strikers. Nevertheless, as the lower court reasoned out, it does
not appear that the aforementioned individual acts were authorized or even
impliedly sanctioned by the Union. Hence, the other strikers who were
innocent of and did not participate in the illegal acts should not be punished
by being deprived of their right of reinstatement. It is only those who had been
found guilty who should be penalized by the loss of the right. 3
We now come to the question of backpay. In an economic strike, the
strikers are not entitled to backpay, since the employer should get the
equivalent day's work for what he pays his employees. During the time that
the strike was an economic one, complainants had no right to back pay. The
Industrial Court could not have made a finding of unfair laborpractice with
respect to such time, as none had so far been committed. This being an
unfair labor practice case, it cannot, therefore, order reinstatement much less
back pay for that period. 4
On the other hand, even after the court has made a finding of
unfair labor practice, it still has the discretion to determine whether or not to
grant back pay. Such discretion was not abused when it denied back wages
to complainants, considering the climate of violence which attended the strike
and picket that the complainants conducted. While the complainants ordered
reinstated did not actively take part in the acts of violence, their minatory
attitude towards the Company may be gathered from the fact that from the
very first day of the strike policemen had to patrol the strike zone in order to
preserve peace. dctai

WHEREFORE, the judgment appealed from is affirmed, without costs.

(Consolidated Labor Association of the Phils. v. Marsman & Co., Inc., G.R. No.
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L-17038, L-17057, [July 31, 1964], 120 PHIL 573-581)