G.R. No.

82918, 11 March 1991

LA SALETTE OF SANTIAGO, INC., petitioner vs. NATIONAL LABOR RELATIONS
COMMISSION and CLARITA JAVIER, respondents.

My Judgement in this case Whether or not she had also acquired permanency, or tenure in the
position of high school principal of the educational system of La Salette of Santiago Inc. when she
accepts the offers of Administrative Assignments and the other commitments in Salette College
she did not intend to sever her professional and business relations and expressed hope in the
High School Department which is it depends upon her. In other words, she was fully aware her
stint as Assistant Principal of the High School was merely temporary and intended to return to the
La Salette College thereafter the fact that she continued to teach part time at La Sallete College
in the first semester of school year.

In regards with the case the usage of rule in private schools or the law must uphold by the faculty
members and teaching staff only for those temporary or non-permanent basis for the said
positions. Those standards by which the service of probationary teacher must be adjudged
satisfactory and should acquire permanence in their employment or the security of tenure in
accordance with the rules and regulations of the Department of Education and Culture and the
school’s own rules and standards to have the right to choose who should teach.

On the other hand, teachers appointed to serve as administrative officials do not normally, and
should not expect to, acquire a second or additional tenure. The acquisition of such an additional
tenure is not normal, is the exception rather than the rule, and should therefore be clearly and
specifically provided by law or contract. Unlike teachers (assistant instructors, instructors,
assistant professors, associate professors, full professors) who aspire for and expect to acquire
permanency, or security of tenure, in their employment, as faculty members, teachers who are
appointed as department heads or administrative officials (e.g., college or department secretaries,
principals, directors, assistant deans, deans) do not normally, and should not expect to, acquire
a second status of permanency, or an additional or second security of tenure, to repeat, is not
consistent with normal practice, constitute the exception rather than the rule, and may take place
only where categorically and explicitly provided by law or agreement of the parties.

Furthermore, in accordance with the law or to the rules of school the acquisition of tenure of the
teacher he/she have the right to remain in employment until he/she reaches the compulsory
retirement age. That tenure, once acquired, cannot be adversely affected or defeated by requiring
the teacher to execute contracts stipulating the termination of his employment upon the expiration
of a fixed period or term. Contracts of that sort are anathema and will be struck down as null and
void
 [G.R. No. L-24224. July 30, 1965.]

MALAYANG MANGGAGAWA SA ESSO (PFPW) and PHILIPPINE FEDERATION OF PETROLEUM

WORKERS, Petitioners, v. ESSO STANDARD EASTERN, INC., and HON. CARMELINO G.
ALVENDIA, Judge of the Court of First Instance of Manila, Respondents.

My defense on the side of the respondent

1. LABOR RELATIONS; EXISTENCE OF LABOR DISPUTE; RIVALRY OF UNIONS AS

TO REPRESENTATION IN COLLECTIVE BARGAINING. — The controversy between
the two rival unions as to which of them should be the recognized bargaining agent for
the employees constitutes a labor dispute within the meaning of the Industrial Peace
Act.
2. ID.; ID.; ID.; EMPLOYER BECOMES DISPUTANT WHEN IT INTERVENES IN CERTIFICATION
CASE. — An employer becomes virtually a disputant when it intervenes in a certification case.

3. ID.; INJUNCTION BY EMPLOYER AGAINST STRIKE AND PICKETING RESULTING FROM

CERTIFICATION ELECTION CONTROVERSY BETWEEN UNIONS TO BE SECURED FROM
INDUSTRIAL COURT. — An injunction sought by the employer against strike and picketing resulting from
a certification election controversy between rival unions may not be secured from the regular courts but
from the Court of Industrial Relations.

4. ID.; ID.; GOODWINS v. HAGEDORN CASE DISTINGUISHED. — the case of Goodwins, Inc. v.
Hagedorn, 101 N.E. (2d) 697, where the New York Court of Appeals enjoined unlawful picketing, is not
applicable to the case at bar where there is no coercion used to accomplish a particular objective by a
labor union.

5. ID.; ID.; ASSOCIATED LABOR UNION v. RAMOLETE CASE DISTINGUISHED. — The case of
Associated Labor Union v. Ramolete, L-23527, March 31, 1965, where the Court held that the CFI had
jurisdiction to issue an injunction writ ex-parte, is not applicable to the case at bar where the employer’s
petition contains no claim for damages and asserts no specific acts on the part of the union members
which are on their face illegal.

defense on the side of the respondents

The respondent, hereinafter to be referred to as ESSO, is a foreign corporation registered in the

Philippines and engaged in the marketing and distribution of petroleum, oil, gas and other allied products.
There are two labor organizations to either of which its employees are affiliated: the Citizens Labor Union
(CLU) and the Malayang Manggagawa sa ESSO (MME). ESSO, however, has its collective bargaining
agreement only with CLU, entered into on April 8, 1963, to expire on July 8, 1966.

On January 7, 1965, MME filed a petition for certification election with the Court of Industrial Relations
(Case No. 1459-MC), claiming to represent a majority of ESSO’s employees at the latter’s terminal plant
in Pandacan, Manila, and praying that after due hearing it be certified as the exclusive bargaining agent
of all said employees. Hearings on the petition were conducted on several dates in February 1965. They
had been scheduled for continuation on the 20th and 22nd of the same month when on February 19 MME
declared a strike at the Pandacan Terminal.
On February 22 ESSO filed a petition for injunction in the Court of First Instance of Manila (Civil Case No.
59942) against MME and the Philippine Federation of Petroleum strikers (PFPW), of which MME is an
affiliate. ESSO asked for a writ of preliminary injunction, which the Court issued ex parte on the same day
on a bond of P1,000.00. The writ commanded the respondents to "refrain from continuing to strike, picket
and engage in other concerted activities, causing stoppage or slow-down of work at the petitioner’s
Pandacan Terminal and other related stations . . . as long as or while the certification election filed by the
(MME) . . . is pending determination by the proper court." cralaw virtua1aw library

On February 24, 1965 MME came to us in this original action for certiorari to have the injunctive order set
aside, and upon proper application we issued a writ of preliminary injunction on February 26, to restrain
its enforcement. The validity of the order of respondent court is assailed by petitioner MME on three
grounds: jgc:chanrobles.com.ph

"(a) The order of injunction is directed not against the commission of illegal acts but against the very right
to strike and the right to picket both of which are protected by law (Sec. 9 (a) (1) (5), R.A. 875) and the
exercise of which cannot be enjoined;"

"(b) The injunction order did not comply with the procedural requirements of R.A. 875 and is therefore null
and void;" and

(c) The respondent court did not have jurisdiction to issue the injunction as this belongs, under the facts
of the case, to the Court of Industrial Relations exclusively." cralaw virtua1aw library

The third ground is, in the opinion of this Court, decisive of this case. At the time ESSO applied for
injunction below there was already pending before the Industrial Court the petition for certification election
initiated by MME. While the controversy as to who should be the exclusive bargaining agent for the
employees was primarily between the two contending unions ESSO became a party when it submitted to
that Court, under date of January 30, 1965, a motion to dismiss MME’s petition for certification election on
the ground that the bargaining agreement between ESSO and CLU was still effective and would not
expire until July 8, 1966. On March 6, 1965 the Industrial Court, over the signature of Associate Judge
Emiliano C. Tabigne, issued an order denying the motion and requesting the Department of Labor to
conduct the certification election prayed for by MME. Concerning the strike declared by MME on February
19, 1965, the following statement of the Industrial Court appears in the said order: jgc:chanrobles.com.ph

"In the course of the hearings, petitioner union called the attention of this Court to the alleged threatened
dismissal or change in the working conditions of the employees which it feared had the effect of
influencing the election. This Court succeeded in getting the parties to agree to maintain the status quo
during the pendency of the case. Unfortunately, before the hearings were terminated, petitioner union
declared a strike allegedly on the ground of unfair labor practices and the alleged violation by the
Company of the agreement in open court that status quo will be maintained . . ." (Emphasis ours)

A similar allegation has been made by MME in its petition and memoranda filed in and during the hearing
of this certiorari case, to the effect that it declared the strike because of certain unfair labor practices
committed by ESSO. This, if true, would mean that the authority to issue an injunction in connection with
that strike pertained exclusively to the Industrial Court in accordance with Republic Act No. 875 and that
respondent Court of First Instance had no such authority, acting under the provisions of the Rules of
Court.

ESSO maintains however, that the question of jurisdiction must be determined in the light of the
allegations in the petition invoking it, and that there is nothing in its petition for injunction below to indicate
the existence of a labor dispute or the commission by it of any unfair labor practice, which in fact is
expressly denied. What is alleged among other things, is that the concerted activities of MME sought to
be enjoined, namely, strike and picketing (and blocking entrance and exit of ESSO’s Pandacan Terminal)
are illegal and unjustified because of the still pending election certification case and the existing collective
bargaining agreement with CLU, and that said activities were "resorted to in order to compel the petitioner
(ESSO) to commit an unlawful act which is to discriminate against the Citizens Labor Union . . . even
before MME is certified by the Court of Industrial Relations." cralaw virtua1aw library

The controversy between the two rival unions as to which of them should be the recognized bargaining
agent for the employees constitutes a labor dispute within the meaning of the Industrial Peace Act
(Balaquezon Transportation Labor Union v. Hon. Muñoz-Palma, 106 Phil. 532, Nov. 27, 1959). Section 2
(j) of said Act defines a labor dispute as including "any controversy concerning terms, tenure, or
conditions of employment, or concerning the association or representation of persons in negotiating,
fixing, maintaining, changing or seeking to arrange terms and conditions of employment, regardless of
whether the disputants stand in the proximate relation of employer and employee." cralaw virtua1aw library

ESSO says the dispute is between the two unions, and suggests that the result of the certification election
between them is to it a matter of indifference. But the fact is ESSO became virtually a disputant when it
intervened in the certification case before the Industrial Court and made common cause with CLU by
asking for the dismissal of MME’s petition. The strike which MME declared after it filed said petition may
be considered as merely an incident in said case, interwoven as it was, according to the allegations of
ESSO itself, with the contest for bargaining supremacy between the two labor organizations. From the
standpoint of both law and expediency the remedy lay with the Industrial Court in the certification case,
and not with the respondent Court of First Instance.

ESSO cites the case of Goodwins, Inc. v. Frank Hagedorn, Et Al., 303 N. Y. 303, 101 N. E. (2d) (697),
where the New York Court of Appeals held that the picketing there in question was unlawful and could be
enjoined by the courts because its purpose was to coerce plaintiff employers "to yield to a demand that
they recognize the defendant union instead of some rival organization as the exclusive collective
bargaining agent for the employees . . . in advance of a certification by the National Labor Relations’
Board in the pending representation proceeding." cralaw virtua1aw library

We do not see that the decision relied upon is here applicable. In the present case no coercion to
accomplish the same particular objective as that found by the New York Court is alleged in ESSO’s
petition below. It would be unjustified to derive gratuitously a similar conclusion from the vague assertion
that MME struck to compel ESSO to discriminate against CLU, the rival union, especially considering the
fact that it was MME that went to the Court of Industrial Relations precisely to ask for a certification
election. Having resorted to such judicial process, as provided by law, MME could hardly be expected to
employ coercive measures to attain the same result. If anything, the allegation that MME declared a strike
to compel ESSO to discriminate against CLU is an allegation of unfair labor practice on the part of MME
under Section 4, b (2) of Republic Act No. 875, which would put the case within the jurisdiction of the
Industrial Court.

The harshness of the remedy resorted to by ESSO may be readily appreciated. The right of employees to
strike and picket is recognized and protected by law. This is part of the right "to engage in concerted
activities for the purpose of collective bargaining and other mutual aid or protection" set forth in section 3
of the Industrial Peace Act. The issuance of a temporary or permanent injunction in a case involving or
growing out of a labor dispute, where it is authorized by said Act, is restricted by indispensable procedural
requisites, among which is a previous hearing wherein certain facts must be established, namely, the
substantial and irreparable injury will be caused to the property of the complainant unless the injunction is
issued; that the injury thus averted is greater than that caused by the injunction to the defendant; that the
complainant has no adequate remedy at law; and that the public officers charged with the duty to protect
the complainant’s property are unable or unwilling to furnish adequate protection (Section 9, d, R.A. 875).
And yet, notwithstanding such safeguards ESSO was able to obtain a preliminary injunction ex-parte not
against specific unlawful acts but against the strike and picketing conducted by the employees affiliated
with MME, by the simple expedient of going to a regular court, alleging in its petition that no labor dispute
existed, and invoking the Rules of Court on injunctions instead of the provisions of the Industrial Peace
Act.

Petitioner, in challenging the jurisdiction of respondent Court to issue the injunction, maintains that the
strike it declared was caused by unfair labor practices committed by ESSO, and in support cites excerpts
from the transcript of the proceedings before the Industrial Court in the certification election case. For
instance, reference is made, quoting from said transcript, to the suspension by ESSO of two of its
employees in violation of a directive by the said court that the status quo should be maintained until the
case was resolved. We make no finding here as to whether the fact referred to is true or not; but it does
suggest quite forcefully that if the injunction had not been issued by respondent court ex-parte and
petitioner here had first been heard the court would have had before it certain facts vital to the basic
question of jurisdiction in the case. As it turned out, in view of the absence of any hearing and only in
accordance with the prayer in the petition before it respondent Court enjoined the strike, the picketing and
other concerted activities of the MME members in their entirety — activities which fundamentally are
recognized and accorded protection by law.

ESSO invites attention to our recent decision in Associated Labor Union Et. Al., v. Judge Ramolete Et.
Al., 121 Phil. 559, March 31, 1965, and submits that the same is controlling in the present case.
Respondent Judge of First Instance there issued a preliminary injunctive writ ex-parte against specific
activities of the Associated Labor Union consisting of allegedly "harassing and coercive tactics, threats,
cajoleries and other overt acts which (were) claimed to be illegal interference in the contractual relations"
between the two other respondents (petitioners below), the Katipunan Lumber Co. and Roque Abellar.
The union applied to us for a writ of certiorari and prohibition, which we denied on the principal ground
that in view of the allegations in the petition for injunction upon which respondent Judge acted he did not
do so without or in excess of jurisdiction or with grave abuse of discretion. We said: "In the case at bar,
the plaintiffs sought the amount of P50,000.00 by way of damages on overt acts, which they considered
illegal, and which had caused them losses. They also asserted that there existed no employer-employee
relationship between them. Generally, therefore, upon such allegations, the CFI had jurisdiction over the
case and it was authorized under the Rules of Court to issue an injunctive writ even ex-parte, upon a valid
showing of the necessity thereof." cralaw virtua1aw library

The case before us is demonstrably different. ESSO’s petition in respondent Court contains no claim for
damages in any stated amount and asserts no specific acts on the part of MME members which are on
their face illegal and to which the injunction is exclusively directed, the same being a blanket one against
continuing to strike, picket and engage in other concerted activities. Those engaged in the strike and
picketing are admittedly employees of ESSO; the existence of a labor dispute between them and the
other labor organization (CLU), in which dispute ESSO became virtually a party, is clearly inferable from
its petition below; and such dispute was already before the Court of Industrial Relations when ESSO went
to respondent Court of First Instance.

It is true petitioner here applied to us for relief in a rather precipitate manner, not having waited until
respondent Court could resolve its motion to reconsider the injunction issued. The excuse given is that
the striking laborers were being arrested in mass (32 of them on February 23, 1965) by the police for
picketing, in violation of the broad terms of the injunction. Ordinarily relief by certiorari is not extended
unless the lower court has been given a chance to correct itself; but under the circumstances of this case,
especially considering that in our opinion said court acted without jurisdiction and the question involved
should go to the Court of Industrial Relations as an incident in the certification election case already filed
there, the procedural prerequisite referred to should be disregarded.

WHEREFORE, the writ prayed for is granted; the order complained of is set aside, and the injunction
issued by this Court is made permanent, with costs against private Respondent.
 [G.R. No. 123276. August 18, 1997.]

MARIO TIU and JONATHAN HAYUHAY, Petitioner, v. NATIONAL LABOR RELATIONS

COMMISSION and REPUBLIC BROADCASTING SYSTEM, INC. (CHANNEL 7), Respondent.

DECISION

PADILLA, J.:

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.chanrobles virtual lawlibrary

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."cralaw virtua1aw library

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:chanrob1es virtual 1aw library

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:chanrob1es virtual 1aw library

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:chanrob1es virtual 1aw
library

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:chanrob1es virtual 1aw library

a. "The notice of strike did not specifically charge the company (RBS) of unfair labor practices, only pro
forma allegations 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."cralaw virtua1aw
library

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." cralawnad

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)."cralaw virtua1aw library

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."cralaw
virtua1aw library

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."cralaw virtua1aw library

Upon the other hand, Rule III Sec. 6 provides that

"x x x

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."cralaw virtua1aw library

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)chanroblesvirtuallawlibrary

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.

[G.R. No. L-25999. February 9, 1967.]

ASSOCIATED LABOR UNION, Petitioner, v. JUDGE AMADOR E. GOMEZ, JUDGE JOSE C.

BORROMEO, and SUPERIOR GAS And Equipment Co. of Cebu, Inc., Respondents.

Sino, Mendoza, Ruiz & Associates for Petitioner.

Paredes, Poblador, Cruz & Nazareno for Respondents.

SYLLABUS

1. LABOR LAW; UNFAIR LABOR PRACTICE; COERCION OF EMPLOYEES BY MANAGEMENT OR

UNION. — The alleged act by management of coercing or instigating members of a union to resign
therefrom is clearly an unfair labor practice under the Industrial Peace Act because it is aimed at crippling
the union, throwing it off balance, destroying its bargaining authority, and is an attack against the Magna
Carta of Labor. By the same token, the charge of management against the union that the latter is
coercing the resigned employees to rejoin the union is no less a case of unfair labor practice.

2. ID.; COURT OF INDUSTRIAL RELATIONS; EXCLUSIVE JURISDICTION OVER UNFAIR LABOR

PRACTICE CASES. — A rule buttressed upon statute and reason and frequently reiterated in
jurisprudence is that labor cases involving unfair labor practice are within the exclusive jurisdiction of the
Court of Industrial Relations.
3. ID.; ID.; AVERMENT OF DAMAGES DOES NOT DEFEAT CIR’S JURISDICTION TO HEAR UNFAIR
LABOR PRACTICE CHARGE REASON THEREFOR. — The averment that the employer has suffered
damages by reason of a strike does not work to defeat the jurisdiction of the Court of Industrial Relations
to hear an unfair labor practice charge, because the right to damages still has to depend on the evidence
in the unfair labor practice case in that court. To hold otherwise is to sanction split jurisdiction which is
obnoxious to the orderly administration of justice.

4. ID.; UNFAIR LABOR PRACTICE CASE INITIATED BY UNION IN THE COURT OF INDUSTRIAL
RELATIONS DOES NOT "DIVEST" THE COURT OF FIRST INSTANCE OF JURISDICTION WHICH
THE LATTER DID NOT ORIGINALLY HAVE. — Where the union filed an unfair labor practice case in the
Court of Industrial Relations on the very same day that management went to the Court of First Instance,
which is without jurisdiction over the subject matter, and previous thereto the union struck precisely
because of the unfair labor practice allegedly indulged in by management, the unfair labor practice case
cannot be said to be an afterthought of the union nor calculated merely to divest the Court of First
Instance of jurisdiction which it did not possess.

5. ID.; PRELIMINARY INJUNCTIONS, ISSUANCE THEREOF BY COURTS OF FIRST INSTANCE NULL

AND VOID IN UNFAIR LABOR PRACTICE CASES. — As the Court of First Instance is without
jurisdiction over an unfair labor practice case, it does not have authority to provide for an ancillary remedy
in the case and the injunction it issues therein is coram non judice, and is void.

DECISION

SANCHEZ, J.:

Following are the facts that spawned the present proceedings:chanrob1es virtual 1aw library

On January 1, 1965, Associated Labor Union 1 and Superior Gas and Equipment Co. of Cebu, Inc. 2
entered into a collective bargaining contract. It was to expire on January 1, 1966. Prior to the contract’s
expiry, union and employer started negotiations for its renewal. Late in February, 1966, while bargaining
was in progress, 12 of Sugeco’s employees resigned from the Union. Negotiations were broken. On
March 1, 1966, the Union wrote Sugeco. There, request was made that unless the 12 resigned
employees 3 could produce a clearance from the Union, they be not allowed in the meantime to report for
work. On the same day, Sugeco’s attorney rejected the request. The reasons given are that irreparable
injury would ensue, that the bargaining contract had lapsed, and that the Company could no longer
demand from its employees the requested clearance. Sugeco made it understood that after the 12 men
would have returned into the Union fold, said company would then be "in a position to negotiate again for
the renewal of the collective bargaining contract." Also on the same day, March 1, the Union wrote
Sugeco, charged the latter with bargaining in bad faith, and its supervisors with "campaigning for the
resignation of members of this Union." The Union there served notice "unless the aforementioned unfair
labor practice acts will immediately be stopped and a collective bargaining agreement be signed between
your company and this union immediately after receipt of this letter, this union will declare a strike against
your management and correspondingly establish picket lines in any place where your business may be
found." On March 3, 1966, counsel for Sugeco wrote the Union stating that, with the resignation of union
members aforesaid, the Union was no longer the representative of the majority of the employees "for
purposes of negotiation and recognition."

On March 4, the Union struck, picketed the Basak (Mandawe) plant of Sugeco.

The next day, March 5, 1966, Sugeco went to the Court of First Instance of Cebu (Case No. R-9221,
entitled "Superior Gas and Equipment Co. of Cebu, Inc., Petitioner, v. Associated Labor Union,
respondent"), praying that the Union be restrained from alleged illegal picketing activities at its Basak
plant, and also from picketing Sugeco’s offices at Juan Luna street, Cebu City, and its other offices
located elsewhere in the Philippines.

On the same date, March 5, 1966, upon a bond of P5,000.00, respondent Judge Amador E. Gomez,
purportedly upon the authority of the Rules of Court, 4 issued ex-parte the writ of preliminary injunction
prayed for. The Union moved to reconsider. Ground, inter alia, is that the court of first instance had no
jurisdiction over the subject-matter — unfair labor practice. It was the turn of the other respondent, Judge
Jose C. Borromeo, to refuse reconsideration.

Meanwhile, on March 5, 1966 — on the same day the Court of First Instance complaint was filed by
Sugeco against the Union — the latter lodged with the Court of Industrial Relations (CIR, for short) a
charge for unfair labor practice against Sugeco, its general manager, Concepcion Y. Lua, and its two
supervisors, Nestor Yu and Mariano Nulla. The Union there averred that said respondents coerced and
exerted pressure upon the union members to resign, as they did resign, from the Union; and that such
resignations were seized upon by Sugeco to refuse further negotiations with the Union. Offshoot is the
complaint for unfair labor practice registered in the CIR on April 29, 1966 by its Acting Prosecutor. 5

On May 9, 1966, the Union came to this Court on certiorari and prohibition. The Union here prays that
respondent judges of the Court of First Instance of Cebu be declared without jurisdiction over the subject
matter of the petition in Civil Case No. R-9221 aforesaid; that the writ of preliminary injunction therein
issued be annulled; and that said judges be directed to dismiss said case. The Union also asks that
pendente lite the respondent judges be stopped from further proceeding with the case just adverted to.

This Court on May 16, 1966, issued the solicited cease-and-desist order.

The quintessence of this case is jurisdiction.

First, we go to the background facts. We take stock of Sugeco’s petition against the Union in the Court of
First Instance of Cebu (Case No. P.-9221). Read as it should be, Sugeco in paragraph 10 thereof
charges the Union with "coercing the resigned employees to rejoin" the same. And this, obviously to
neutralize the Union claim that Sugeco was coercing and cajoling its members to separate therefrom. 6

This charge and countercharge require us to focus attention on the Industrial Peace Act. 7 Section 4(a)
and (b) thereof recite, as follows:chanrob1es virtual 1aw library

(a) It shall be unfair labor practice for an employer:chanrob1es virtual 1aw library

(1) To interfere with, restrain or coerce employees in the exercise of their rights guaranteed in section
three.

x x x

"(b) It shall be unfair labor practice for a labor organization or its agents:chanrob1es virtual 1aw library

(1) To restrain or coerce employees in the exercise of their rights under section three . . ."cralaw
virtua1aw library

And Section 3 referred to in Sections 4(a) and (b), provides:jgc:chanrobles.com.ph

". . . Employees shall have the right to self-organization and to form, join or assist labor organizations of
their own choosing for the purpose of collective bargaining through representatives of their own choosing
and to engage in concerted activities for the purpose of collective bargaining and other mutual aid or
protection . . ."cralaw virtua1aw library

The broad sweep of the law suggests that the coercion or cajolery of employees heretofore described, by
management or union, is unfair labor practice. 8 Therefore, the alleged act of coercing or instigating union
members to resign therefrom is clearly within the coverage of the prescription. It is aimed at crippling the
Union, throwing it off balance, destroying its bargaining authority. It is an attack against the Magna Carta
of Labor. By the same token, the charge levelled by Sugeco against the Union that the latter "is coercing
the resigned employees to rejoin the Union" is no less an unfair labor practice.

Jurisdiction then is exclusively vested in the Court of Industrial Relations. For, explicit in Section 5(a) of
the Industrial Peace Act is the precept that —

"The Court shall have jurisdiction over the prevention of unfair labor practices and as empowered to
prevent any person from engaging in any unfair labor practice. This power shall be exclusive and shall not
be affected by any other means of adjustment or prevention that has been or may be established by an
agreement, code, law or otherwise." [Italics supplied]

Nor will Sugeco’s averment below that it suffers damages by reason of the strike, work to defeat the CIR’s
jurisdiction to hear the unfair labor practice charge. Reason for this is that the right to damages "would still
have to depend on the evidence in the unfair labor practice case" — in the CIR. 9 To hold otherwise is to
sanction split jurisdiction — which is obnoxious to the orderly administration of justice. 10

The stance that the ULP case initiated by the Union in the CIR was an afterthought, will not carry the day
for Sugeco. That case was filed on the very same day Sugeco went to the Court of First Instance —
which anyway, is without jurisdiction over the subject-matter. The Union struck precisely because of the
unfair labor practice allegedly indulged in by Sugeco. So that, the ULP case was not calculated merely to
divest the Cebu court of first instance of jurisdiction which it did not possess. 11 A rule buttressed upon
statute and reason and frequently reiterated in jurisprudence is that labor cases involving labor practice
are within the exclusive jurisdiction of the CIR. By now, this rule has ripened into dogma. It thus
commands adherence, not breach. 12 This Court once pointedly remarked that" [t]he policy of social
justice guaranteed by the Constitution demands that when cases appear to involve labor disputes courts
should take care in the exercise of their prerogatives and discretion." 13

The Court of First Instance of Cebu, we rule, is without jurisdiction over the subject-matter of Case No. R-
9221. Its judges, therefore, did not have the authority to provide for an ancillary remedy in that case.
Hence, the injunction below complained of was issued coram non judice. It is void.

For the reasons given:chanrob1es virtual 1aw library

(1) the petition herein for a writ of certiorari and prohibition is hereby granted, and the writ of preliminary
injunction we issued on May 18, 1966 is declared permanent;

(2) the writ of preliminary injunction issued by the Court of First Instance of Cebu in Case No. R-9221,
entitled "Superior Gas and Equipment Co. of Cebu, Inc., Petitioner, v. Associated Labor Union,"
respondent", is hereby declared null and void; and

(3) the respondent judges, or whoever shall take their place, are hereby directed to dismiss the said Case
No. R-9221.

Costs against respondent Superior Gas and Equipment Co. of Cebu, Inc. So ordered.

D E C I S I O N FERNAN, C.J.: Challenged in this petition for certiorari is the jurisdiction of the Labor
Tribunal over Case No. LRD-ROXII-006-82, a claim for unpaid commissions and reimbursement of
certain sums of money filed by herein private respondent Cerila Agarrado against herein petitioners Dr.
Renato Sara and Romeo Araña. chanroblespublishingcompany Private respondent Cerila Agarrado was
an attendant in the clinic of petitioner Dr. Renato Sara. She quit her job in 1973.
chanroblespublishingcompany Four years later, petitioners Dr. Sara and Romeo Araña, being owners of a
rice mill and having begun to engage in the buy and sell of palay and rice, entered into a verbal
agreement with private respondent Agarrado whereby it was agreed that the latter would be paid P2.00
commission per sack of milled rice sold as well as a commission of 10% per kilo of palay purchased. It
was further agreed that private respondent would spend her own money for the undertaking, but to
enable her to carry out the agreement more effectively, she was authorized to borrow money from other
persons, as in fact she did, subject to reimbursement by petitioners.[1] In 1982, private respondent filed
with the National Labor Relations Commission (NLRC) Regional Arbitration Branch No. XI, Cotabato City,
a complaint against petitioner for unpaid commission of P4,598.00 on milled rice sold, P2,982.80 on palay
sold, reimbursement of P17,500.00 which she had borrowed from various persons and P1,749.00 of her
own money which petitioners allegedly had not reimbursed (LRD-ROXII-006-82). By way of defense,
petitioners raised the issue of lack of jurisdiction on the part of the Labor Arbiter to take cognizance of the
case, there being no employer-employee relationship between the parties. They averred that the claim for
alleged unpaid commission and certain sums of money is governed by the law on agency under the Civil
Code and hence a purely civil obligation cognizable by the regular courts. On January 17, 1973, Labor
Arbiter Magno C. Cruz rendered a decision in favor of private respondent ordering petitioners to pay all
the claims amounting to P26,397.80.[2] Petitioner appealed the decision to the NLRC, which in a
resolution dated June 25, 1986 affirmed the Labor Arbiter’s decision and dismissed the appeal.[3] Their
motion for reconsideration having been denied, petitioners took the present recourse, maintaining lack of
jurisdiction on the part of the Labor Tribunal as well as grave abuse of discretion on its part in finding
them liable to private respondent. chanroblespublishingcompany In his comment, the Solicitor General
agreed with petitioners that there was no employer-employee relationship between the parties and that by
reason thereof the Labor Arbiter had no jurisdiction over the case. The Solicitor General’s comment was
accompanied by a manifestation and motion stating that he was filing the comment on his own behalf and
that the public respondent NLRC had been informed about his contrary stand.[4] The primordial issue in
this case is whether an employer-employee relationship exists between petitioners and private
respondent as to warrant cognizance by the Labor Arbiter of LRD-ROXII-006-82.
chanroblespublishingcompany To determine the existence of an employer-employee relationship, this
Court in a long line of decisions[5] has invariably applied the following four-fold test: [1] the selection and
engagement of the employee; [2] the payment of wages; [3] the power of dismissal; and [4] the power to
control and employee’s conduct. In the case at bar, we find that although there was a selection and
engagement of private respondent in 1977, the verbal agreement between the parties negated the
existence of the other requisites. chanroblespublishingcompany As to the payment of wages, the verbal
agreement entered into by the parties stipulated that parties respondent would be paid a commission of
P2.00 per sack of milled rice sold as well as a 10% commission on palay purchase. The arrangement
thus was explicitly on a commission basis dependent on the volume of sale or purchase. Private
respondent was not guaranteed any minimum compensation nor was she allowed any drawing account or
advance of any kind against unearned commissions. Her right to compensation depended upon and was
measured by the tangible results she produced — the quantity of rice sold and the quantity of palay
purchased. chanroblespublishingcompany The power to terminate the relationship was mutually vested
upon the parties. Either may terminate the business arrangement at will, with or without cause. Finally,
noticeably absent from the agreement between the parties is the element of control. Among the four (4)
requisites, control is deemed the most important that the other requisites may even be disregarded.[6]
Under the control test, an employer-employee relationship exists if the “employer” has reserved the right
to control the “employee” not only as to the result of the work done but also as to the means and methods
by which the same is to be accomplished.[7] Otherwise, no such relationship exists.
chanroblespublishingcompany We observe that the means and methods of purchasing and selling rice or
palay by private respondent were totally independent of petitioners’ control. As established by the NLRC:
Sometime in June 1977, respondent re-engaged the services of herein complainant to sell milled rice to
the customers of the former, as well as to buy palay for and in behalf of Dr. Renato Sara, with the verbal
agreement that to carry out effectively the said task, complainant was duly authorized by respondent, Dr.
Sara to spend her own money, if necessary but subject to reimbursement, and if that would not be
sufficient, to borrow money from other sources with further understanding that Dr. Sara will repay them
thru the complainant; ([Emphasis supplied], p. 21, Rollo) chanroblespublishingcompany Note that private
respondent was never given capital by his supposed employer but relied on her own resources and if
insufficient, she borrowed money from others. Petitioner did not supply private respondent with tools and
appliances needed to enable her to carry her undertaking, except to authorize her to borrow money from
others, subject to reimbursement. The absence of control is made more evident by the fact that private
respondent was not even obliged to sell the palay she purchased to petitioners. She was at liberty to sell
the palay to any trader offering higher buying rates. She was thus free to sell it to anybody whom she
pleased. Moreover, private respondent worked for petitioners at her own pleasure and was not subject to
definite hours or conditions to work. She could even delegate the task of buying and selling to others, if
she so desired, so simultaneously engaged in other means of livelihood while selling and purchasing rice
or palay. chanroblespublishingcompany Under the conditions set forth in their agreement, private
respondent was an independent contractor, who exercising independent employment, contracted to do a
price of work according to her own method and without being subject to the control of her employer
except as to the result of her work. She was paid for the result of her labor, unlike an employee who is
paid for the labor he performs.[8] The verbal agreement devoid as it was of any stipulations indicative of
control leaves no doubt that private respondent was not an employee of petitioners but was rather an
independent contractor. chanroblespublishingcompany The Labor Tribunal’s jurisdiction being primarily
predicated upon the existence of an employer-employee relationship between the parties, the absence of
such element, as in the case at bar, removes the controversy from the scope of its limited jurisdiction.
WHEREFORE, the instant petition for certiorari is granted. Case No. LRD-ROXII-006-82 of the National
Labor Relations Commission is hereby ordered DISMISSED for lack of jurisdiction.
Chanroblespublishingcompany

FERNAN, C.J.:

Challenged in this petition for certiorari is the jurisdiction of the Labor Tribunal over Case No. LRD-ROXII-
006-82, a claim for unpaid commissions and reimbursement of certain sums of money filed by herein
private respondent Cerila Agarrado against herein petitioners Dr. Renato Sara and Romeo Araña.

Private respondent Cerila Agarrado was an attendant in the clinic of petitioner Dr. Renato Sara. She quit
her job in 1973.

Four years later, petitioners Dr. Sara and Romeo Araña, being owners of a rice mill and having begun to
engage in the buy and sell of palay and rice, entered into a verbal agreement with private respondent
Agarrado whereby it was agreed that the latter would be paid P2.00 commission per sack of milled rice
sold as well as a commission of 10% per kilo of palay purchased. It was further agreed that private
respondent would spend her own money for the undertaking, but to enable her to carry out the agreement
more effectively, she was authorized to borrow money from other persons, as in fact she did, subject to
reimbursement by petitioners.[1]

In 1982, private respondent filed with the National Labor Relations Commission (NLRC) Regional
Arbitration Branch No. XI, Cotabato City, a complaint against petitioners for unpaid commission of
P4,598,00 on milled rice sold P2,982.80 on palay sold, reimbursement of P17,500.00 which she had
borrowed from various persons and P1,749.00 of her own money which petitioners allegedly had not
reimbursed (LRD-ROXII-006-82).
By way of defense, petitioners raised the issue of lack of jurisdiction on the part of the Labor Arbiter to
take cognizance of the case, there being no employer-employee relationship between the parties. They
averred that the claim for alleged unpaid commission and certain sums of money is governed by the law
on agency under the Civil Code and hence a purely civil obligation cognizable by the regular courts.

On January 17, 1973, Labor Arbiter Magno C. Cruz rendered a decision in favor of private respondent
ordering petitioners to pay all the claims amounting to P26,397.80). [2]

Petitioner appealed the decision to the NLRC, which in a resolution dated June 25, 1986 affirmed the
Labor Arbiter's decision and dismissed the appeal.[3]

Their motion for reconsideration having been denied, petitioners took the present recourse, maintaining
lack of jurisdiction on the part of the Labor Tribunal as well as grave abuse of discretion on its part in
finding them liable to private respondent.

In his comment, the Solicitor General agreed with petitioners that there was no employer-employee
relationship between the parties and that by reason thereof the Labor Arbiter had no jurisdiction over the
case. The Solicitor General's comment was accompanied by a manifestation and motion stating that he
was filing the comment on his own behalf and that he public respondent NLRC had been informed about
his contrary stand.[4]

The primordial issue in this case is whether an employer-employee relationship exists between petitioners
and private respondent as to warrant cognizance by the Labor Arbiter of LRD-ROXII-006-82.

To determine the existence of an employer-employee relationship, this Court in a long line of

decisions[5] has invariably applied the following four-fold test: [1] the selection and engagement of the
employee; [2] the payment of wages; [3] the power of dismissal; and[4] the power to control the employee's
conduct.

In the case at bar, we find that although there was a selection and engagement of private respondent in
1977, the verbal agreement between the parties negated the existence of the other requisites.

As to the payment of wages, the verbal agreement entered into by the parties stipulated that private
respondent would be paid a commission of P2.00 per sack of milled rice sold as well as a 10%
commission on palay purchase. The arrangement thus was explicitly on a commission basis dependent
on the volume of sale, or purchase. Private respondent was not guaranteed any minimum compensation
nor was she allowed any drawing account or advance of any kind against unearned commissions. Her
right to compensation depended upon and was measured by the tangible results she produced -- the
quantity of rice sold and the quantity of palay purchased.

The power to terminate the relationship was mutually vested upon the parties. Either may terminate the
business arrangement at will, with or without cause.

Finally, noticeably absent from the agreement between the parties is the element of control. Among the
four (4) requisites, control is deemed the most important that the other requisites may even be
disregarded.[6] Under the control test, an employer-employee relationship exists if the "employer" has
reserved the right to control the "employee" not only as to the result of the work done but also as to the
means and methods by which the same is to be accomplished.[7] Otherwise, no such relationship exists.

We observe that the means and methods of purchasing and selling rice or palay by private respondent
were totally independent of petitioners' control. As established by the NLRC:

xxx sometime in June l977, respondent re-engaged the services of herein complainant to sell milled rice
to the customers of the former, as well as to buy palay for and in behalf of Dr. Renato Sara, with the
verbal agreement that to carry out effectively the said task, complainant was duly authorized by
respondent, Dr. Sara to spend her own money, if necessary but subject to reimbursement, and if that
would not be sufficient, to borrow money from other sources with further understanding that Dr. Sara will
repay them thru the complainant; xxx. ([Italics supplied], p.21 Rollo)
Note that private respondent was never given capital by his supposed employer but relied on her own
resources and if insufficient, she borrowed money from others. Petitioners did not supply private
respondent with tools and appliances needed to enable her to carry her undertaking, except to authorize
her to borrow money from others, subject to reimbursement.

The absence of control is made more evident by the fact that private respondent was not even obliged to
sell the palay she purchased to petitioners. She was at liberty to sell the palay to any trader offering
higher buying rates. She was thus free to sell it to anybody whom she pleased.

Moreover, private respondent worked for petitioners at her own pleasure and was not subject to definite
hours or conditions of work. She could even delegate the task of buying and selling to others if she so
desired, or simultaneously engage in other means of livelihood while selling and purchasing rice or palay.

Under the conditions set forth in their agreement, private respondent was an independent contractor, who
exercising independent employment, contracted to do a piece of work according to her own method and
without being subject to the control of her employer except as to the result of her work. She was paid for
the result of her labor, unlike an employee who is paid for the labor he performs. [8]

The verbal agreement devoid as it was of any stipulations indicative of control leaves no doubt that
private respondent was not an employee of petitioners but was rather an independent contractor.

The Labor Tribunal's jurisdiction being primarily predicated upon the existence of an employer-employee
relationship between the parties, the absence of such element, as in the case at bar removes the
controversy from the scope of its limited jurisdiction.

WHEREFORE, the instant petition for certiorari is granted, Case No LRD-RCXII-006-82 of the National
Labor Relations Commission is hereby ordered DISMISSED for lack of jurisdiction.

. SUPREME COURT
Manila

SECOND DIVISION

G.R. No. 78711 June 27, 1990

ABOITIZ SHIPPING EMPLOYEES ASSOCIATION, LAZARO ABAIGAR, VICTORIANO ANIBAN, FELIPE BATERZAL, RUFINO
YAGUIT, JONNIE YAGUIT and EUGENIO BALBUENA, petitioners,
vs.
NATIONAL LABOR RELATIONS COMMISSION and ABOITIZ SHIPPING CORPORATION, respondents.

Rogelio B. De Guzman for petitioners.

Bienvenido A. Salinas, Jr. for private respondent.

PARAS, J.:

This is a petition for certiorari to set aside the Resolutions of the public respondent National Labor Relations Commission (NLRC) dated April 30, 1987 and May 29, 1987
affirming the Decision of August 23, 1985 rendered by Labor Arbiter Julio P. Andres, Jr. holding that:

... respondent Aboitiz Shipping Corporation could not be guilty of said charge (unfair labor practice through
dismissal) for lack of employer-employee relationship between them and the individual complainants at the time
said act was allegedly committed in April 1985. (p. 165, Rollo)

and consequently dismissing the case for lack of merit. Hence, this petition anchored on two grounds:

1. GRAVE ABUSE OF DISCRETION COMMITTED BY THE NATIONAL LABOR RELATIONS COMMISSION

WHICH AMOUNTS TO LACK OF JURISDICTION.
 2. THE RESOLUTIONS SOUGHT TO BE REVIEWED ARE NOT IN ACCORD WITH LAW AND APPLICABLE
DECISIONS OF THIS HONORABLE COURT. (p. 2 Comment, p. 166, Rollo)

The real issue however which surfaces from the allegations and arguments of the parties is whether or not an employer-employee
relationship existed between respondent Aboitiz Shipping Corporation (ABOITIZ, for short) and the petitioners-workers at the time of
the latter's alleged dismissal on April 26, 1985.

The six (6) petitioners herein claimed that they were employed as carpenters by respondent corporation until their illegal dismissal
on April 26, 1985. They alleged that they were all allegedly dismissed by Ben Baguio and his spouse on April 26, 1985 just a day
after the inspection made by Efren Bautista of the National Capital Region of the Ministry of Labor and Employment on respondent
ABOITIZ in connection with LSED-4-408-85, a labor case which same complainants filed with the Ministry of Labor and
Employment. According to the complainants, said act of the Baguios constitute unfair labor practice defined under par. (f) of Article
249 of the Labor Code, as amended, and the resultant dismissal of the individual complainants is illegal as there was allegedly no
just cause nor were they duly afforded due process of law. They thus, pray that the respondent corporation be held liable for unfair
labor practice through dismissal, damages and attorney's fees.

Respondent ABOITIZ denies that the petitioners were their employees at the time of their dismissal but are employees of
respondent Ben Baguio by virtue of a Service Contract dated June 16, 1984. A pertinent portion of which reads as follows:

8. That it is understood and agreed that there is no employer-employee relationship between the FIRST PARTY
(Aboitiz Shipping Corporation) and SECOND PARTY (Narben's Service Contractor) much less any of the
latter's carpenters. The SECOND PARTY shall have the right to hire and fire such employees, exercise general
control as to the time, manner and method of performance of work; that the sole interest of the FIRST PARTY is
that all its properties, cargoes, equipments and other appurtenances be safe and protected from destruction,
pilferage, damage and other losses as envisioned in paragraph 9. The SECOND PARTY shall hold free from
any liability the FIRST PARTY from any claim of whatsoever nature which the carpenters of the SECOND
PARTY may institute either against the FIRST PARTY and SECOND PARTY. (pp. 3-4, NLRC Resolution; pp. 3-
4, Rollo)

On their part, spouses Ben and Leonarda Baguio aver that they are the proprietors of Narben's Service Contractor engaged in
contracting carpentry jobs and has a service contract with respondent Aboitiz Shipping Corporation. Spouses Baguio admit that the
petitioners were indeed their employees whose duties were to do carpentry work, subject to the condition that the moment their
works were finished, their employment would end, and that they would be re-hired once respondent ABOITIZ would enter into
another contract. Petitioners submit the following pieces of evidence in support of the presence of employer-employee relationship
with respondent Aboitiz, viz:

(1) Social Security Numbers:

03-173171-0 — Lazaro Abaigar;

06-112277-9 — Felipe Baterzal;
03-634457-0 — Rufino Yaguit;
03-77089084 — Jonnie Yaguit;
07-4915-8 — Eugenio Balbuena; and
03-78050193 — Victoriano Aniban

(2) Deduction for Social Security Premitims from their salaries;

(3) Company Identification Cards issued to petitioners, examples of which are Annexes "B", "B-1" and "B-2", of
Petition;

(4) Withholding of taxes as evidenced by BIR Form W-2 Annexes "C" to "C-5", of Petition; and

(5) Time Cards and normal conduct of employer-employee relations enumerated in the above Statement of
Facts. (Memorandum of Petitioners, p. 212, Rollo)

They therefore pray that the resolutions of public respondent be set aside; that this Court declare the illegality of dismissal of
individual petitioners; and that their reinstatement with full backwages to private respondent as regular employees thereof be
granted.

In the resolution of April 18, 1988, this Court gave due course to the petition and required the parties to file their simultaneous
memoranda within thirty (30) days from notice.
Records reveal that petitioners are not regular employees of the private respondent at the time of their alleged illegal dismissal. For
one, petitioners, on June 20, 1984, filed individual application for employment with Narben's Service Contractor. They were
eventually issued payslips, deducted SSS premiums, Pag-ibig fund and withholding tax from their salaries by this Contractor.

As held in Mafinco Trading Corporation vs. Ople, 70 SCRA 139 (1976), the existence of employer-employee relationship is
determined by four (4) elements, namely: (1) the selection and engagement of the employee; (2) the payment of wages; (3) the
power of dismissal; and (4) the power to control employees' conduct. From a reading of the provisions of the aforesaid service
contract, the concurrence of these four elements on NARBEN's will easily be noted. For NARBEN's had the right to hire the
necessary number of carpenters to accomplish the carpentry requirements of respondent corporation and to fire them. It had charge
of the payment of wages of its laborers and the power of administrative supervision and general control as to the time, manner and
method of performance of work.

All the above evidences constitute positive proofs that the petitioners-workers were, at the time in question, in the employ of
NARBEN's and not anymore of respondent Corporation. Respondent NLRC, therefore, did not err in refusing to give weight to
petitioners' uncorroborated claim that they were continuously employees of Aboitiz Shipping Corporation.

With regard to the issuance of Id's to petitioners by private respondent, it appears that these Id's were special Id's and is different
from those issued to its regular employees. On these special Identification cards, the following words are written: THIS IS TO
CERTIFY THAT THE BEARER WHOSE PICTURE APPEAR ON THIS CARD IS AUTHORIZED TO HAUL, OPERATE, AND
TRANSACT BUSINESS WITH ABOITIZ SHIPPING CORPORATION. On the other hand, appearing on the regular or probationary
employee's Id cards are the following words: "THIS IS TO CERTIFY THAT THE BEARER WHOSE PICTURE AND PERSONAL
DATA APPEAR ON THIS CARD IS AN EMPLOYEE OF ABOITIZ SHIPPING CORPORATION." (pp. 109-110, Rollo)

Besides, the issue of the existence of employer-employee relationship between the parties in the case at bar is a question of fact
which has already been resolved by the labor arbiter and upheld by the National Labor Relations Commission. Review of labor
cases are confined to questions of jurisdiction or grave abuse of discretion. We find that no grave abuse of discretion W-as
committed by public respondent NLRC in affirming the non-existence of employer-employee relationship between petitioners and
private respondent.

PREMISES CONSIDERED, the petition is hereby DISMISSED for lack of merit.

What Are Unfair Labor Practices?

The term “unfair labor practices” refers to any actions by employers that violate labor laws such
as the National Labor Relations Act (NLRA). These deal specifically with unions and union
rights, and are different from broader employment violations, such as illegal advertising or
“cooking the books." Unfair labor practices may also involve limitations on unions and union
members.

What Are Some Examples of Unfair Labor Practices?

Unfair labor laws prevent employers from taking actions such as:

 Interfering or dominating labor union organization or formation

 Discriminating against employees engaged in union (“concerted”) activities
 Taking action against an employee for filing charges related to unfair labor practices (i.e.
engaging in “retaliatory discharge”)
 Refusing to engage in negotiations or bargaining with union representatives
 Interfere with general employee rights provided for by union labor laws

Unfair labor laws also prevent employers from discriminating against employees who have
refused to participate in union activities.

Certain groups of employees are not covered by the NLRA. They include:

 confidential employees such as company accountants

 farmworkers
 the families of employers
 government workers
 most domestic workers, and
 certain industry groups, such as railroad employees, whose work situations are
regulated by other laws.