T&H Shopfitters Corp. V. T&H Shopfitters Corp.

Workers Union 1
February 26, 2014| MENDOZA, J.
By: Justin

SUMMARY:

FACTS:
 On September 7, 2004, the T&H Shopfitters Corporation/ Gin Queen Corporation workers union
(THS-GQ Union) filed their Complaint for Unfair Labor Practice (ULP) by way of union busting, and
Illegal Lockout, with moral and exemplary damages and attorney’s fees, against T&H Shopfitters
Corporation (T&H Shopfitters) and Gin Queen Corporation before the Labor Arbiter (LA).
 1st CAUSE: In their desire to improve their working conditions, respondents and other employees of
held their first formal meeting on November 23, 2003 to discuss the formation of a union. The
following day, seventeen (17) employees were barred from entering petitioners’ factory premises
located in Castillejos, Zambales, and ordered to transfer to T&H Shopfitters’ warehouse at Subic Bay
Freeport Zone (SBFZ) purportedly because of its expansion. Afterwards, the said seventeen (17)
employees were repeatedly ordered to go on forced leave due to the unavailability of work.
 Respondents contended that the affected employees were not given regular work assignments, while
subcontractors were continuously hired to perform their functions. Respondents sought the
assistance of the National Conciliation and Mediation Board. Subsequently, an agreement between
petitioners and THS-GQ Union was reached. Petitioners agreed to give priority to regular employees
in the distribution of work assignments. Respondents averred, however, that petitioners never
complied with its commitment but instead hired contractual workers. Instead, Respondents claimed
that the work weeks of those employees in the SBFZ plant were drastically reduced to only three (3)
days in a month.
 2nd CAUSE: On March 24, 2004, THS-GQ Union filed a petition for certification election and an order
was issued to hold the certification election in both T&H Shopfitters and Gin Queen.
 On October 10, 2004, petitioners sponsored a field trip to Iba, Zambales, for its employees. The
officers and members of the THS-GQ Union were purportedly excluded from the field trip. On the
evening of the field trip, a certain Angel Madriaga, a sales officer of petitioners, campaigned against
the union in the forthcoming certification election.
 When the certification election was scheduled on October 11, 2004, the employees were escorted
from the field trip to the polling center in Zambales to cast their votes. The remaining employees
situated at the SBFZ plant cast their votes as well. Due to the heavy pressure exerted by petitioners,
the votes for “no union” prevailed.
 3rD CAUSE: A memorandum was issued by petitioner Ben Huang (Huang), Director for Gin Queen,
informed its employees of the expiration of the lease contract between Gin Queen and its lessor in
Castillejos, Zambales and announced the relocation of its office and workers to Cabangan, Zambales.
 When the respondents, visited the site in Cabangan, discovered that it was a “talahiban” or grassland.
The said union officers and members were made to work as grass cutters in Cabangan, under the
supervision of a certain Barangay Captain Greg Pangan. Due to these circumstances, the employees
assigned in Cabangan did not report for work. The other employees who likewise failed to report in
Cabangan were meted out with suspension.
 In its defense, Petitioners also stress that they cannot be held liable for ULP for the reason that there
is no employer-employee relationship between the former and respondents. Further, Gin Queen
avers that its decision to implement an enforced rotation of work assignments for respondents was a
management prerogative permitted by law, justified due to the decrease in orders from its
customers, they had to resort to cost cutting measures to avoid anticipated financial losses. Thus, it
assigned work on a rotational basis. It explains that its failure to present concrete proof of its
decreasing orders was due to the impossibility of proving a negative assertion. It also asserts that the
transfer from Castillejos to Cabangan was made in good faith and solely because of the expiration of

1
 its lease contract in Castillejos. It was of the impression that the employees, who opposed its
economic measures, were merely motivated by spite in filing the complaint for ULP against it.

ISSUES/HELD:
1. Whether or not ULP acts were committed by petitioners against respondents.
ULP were committed by petitioners against respondents.Petitioners are being accused of violations of
paragraphs (a), (c), and (e) of Article 257 (formerly Article 248) of the Labor Code,13 to wit:

Article 257. Unfair labor practices of employers.—It shall be unlawful for an employer to commit any of the
following unfair labor practices:

(a) To interfere with, restrain or coerce employees in the exercise of their right to self-organization;

xxxx

© To contract out services or functions being performed by union members when such will interfere with,
restrain, or coerce employees in the exercise of their right to self-organization;

xxxx

(e) To discriminate in regard to wages, hours of work, and other terms and conditions of employment in order to
encourage or discourage membership in any labor organization. x x x

 The questioned acts of petitioners, namely: 1) sponsoring a field trip to Zambales for its employees,
to the exclusion of union members, before the scheduled certification election; 2) the active campaign
by the sales officer of petitioners against the union prevailing as a bargaining agent during the field
trip; 3) escorting its employees after the field trip to the polling center; 4) the continuous hiring of
subcontractors performing respondents’ functions; 5) assigning union members to the Cabangan site
to work as grass cutters; and 6) the enforcement of work on a rotational basis for union members,
taken together, reasonably support an inference that, indeed, such were all orchestrated to restrict
respondents’ free exercise of their right to self-organization.

 The Court is of the considered view that petitioners’ undisputed actions prior and immediately
before the scheduled certification election, while seemingly innocuous, unduly meddled in the affairs
of its employees in selecting their exclusive bargaining representative.

Dispositive: CA Ruling Affirmed. Except: ATTY’s fees deleted

THE INSULAR LIFE ASSURANCE CO., LTD., EMPLOYEES ASSOCIATION-NATU,
FGU INSURANCE GROUP WORKERS and EMPLOYEES ASSOCIATION-NATU, and
INSULAR LIFE BUILDING EMPLOYEES ASSOCIATION-NATU
vs.
THE INSULAR LIFE ASSURANCE CO., LTD., FGU INSURANCE GROUP, JOSE M.
OLBES and COURT OF INDUSTRIAL RELATIONS

FACTS: The Insular Life Assurance Co., Ltd., Employees Association-NATU, FGU Insurance
Group Workers & Employees Association-NATU, and Insular Life Building Employees
Association-NATU (hereinafter referred to as the Unions), while still members of the Federation
of Free Workers (FFW), entered into separate CBAs with the Insular Life Assurance Co., Ltd.
and the FGU Insurance Group (hereinafter referred to as the Companies).

Two of the lawyers of the Unions then were Felipe Enaje and Ramon Garcia; the latter was
formerly the secretary-treasurer of the FFW and acting president of the Insular Life/FGU unions
and the Insular Life Building Employees Association. Garcia, as such acting president, in a
circular issued in his name and signed by him, tried to dissuade the members of the Unions
from disaffiliating with the FFW and joining the National Association of Trade Unions (NATU),
to no avail.
Enaje and Garcia soon left the FFW and secured employment with the Anti-Dummy Board of
the Department of Justice. Thereafter, the Companies hired Garcia in the latter part of 1956 as
assistant corporate secretary and legal assistant in their Legal Department. Enaje was hired as
personnel manager of the Companies, and was likewise made chairman of the negotiating panel
for the Companies in the collective bargaining with the Unions.
Unions jointly submitted proposals to the Companies; negotiations were conducted on the
Union’s proposals, but these were snagged by a deadlock on the issue of union shop, as a result
of which the Unions filed on January 27, 1958 a notice of strike for “deadlock on collective
bargaining.” The issue was dropped subsequently (in short, nagkasundo). But, the parties
negotiated on the labor demands but with no satisfactory result due to a stalemate on the matter
of salary increases.

Meanwhile, 87 unionists were reclassified as supervisors without increase in salary nor in

responsibility while negotiations were going on in the Department of Labor after the notice to strike
was served on the Companies. These employees resigned from the Unions.
On May 21, 1958 the Companies through their acting manager and president, sent to each of the
strikers a letter (exhibit A) quoted verbatim as follows:
We recognize it is your privilege both to strike and to conduct picketing.

However, if any of you would like to come back to work voluntarily, you may:

1. Advise the nearest police officer or security guard of your intention to do so.
2. Take your meals within the office.
3. Make a choice whether to go home at the end of the day or to sleep nights at the office where
comfortable cots have been prepared.
4. Enjoy free coffee and occasional movies.
5. Be paid overtime for work performed in excess of eight hours.
6. Be sure arrangements will be made for your families.
 7. The decision to make is yours — whether you still believe in the motives of the strike or in
the fairness of the Management.
 

Unions, however, continued on strike, with the exception of a few unionists who were convinced
to desist by the aforesaid letter

From the date the strike was called on May 21, 1958, until it was called off on May 31, 1958, some
management men tried to break thru the Unions’ picket lines xxx succeeded in penetrating the
picket lines in front of the Insular Life Building, thus causing injuries to the picketers and also to
the strike-breakers due to the resistance offered by some picketers.
Alleging that some non-strikers were injured and with the use of photographs as evidence, the
Companies then filed criminal charges against the strikers with the City Fiscal’s Office of
Manila.xxx
Another letter was sent by the company to the individual strikers:

The first day of the strike was last 21 May 1958.

Our position remains unchanged and the strike has made us even more convinced of our
decision.

We do not know how long you intend to stay out, but we cannot hold your positions open for
long. We have continued to operate and will continue to do so with or without you.

If you are still interested in continuing in the employ of the Group Companies, and if there are
no criminal charges pending against you, we are giving you until 2 June 1958 to report for work
at the home office. If by this date you have not yet reported, we may be forced to obtain your
replacement.

Before, the decisions was yours to make.

So it is now.

Incidentally, all of the more than 120 criminal charges filed against the members of the Unions,
except 3, were dismissed by the fiscal’s office and by the courts . These three cases involved “slight
physical injuries” against one striker and “light coercion” against two others.
At any rate, because of the issuance of the writ of preliminary injunction against them as well as
the ultimatum of the Companies giving them until June 2, 1958 to return to their jobs or else be
replaced, the striking employees decided to call off their strike and to report back to work on
June 2, 1958.

* However, before readmitting the strikers, the Companies required them not only to secure
clearances from the City Fiscal’s Office of Manila but also to be screened by a management
committee among the members of which were Enage and Garcia. The screening committee
initially rejected 83 strikers with pending criminal charges. However, all non-strikers with
pending criminal charges which arose from the breakthrough incident were readmitted
immediately by the Companies without being required to secure clearances from the fiscal’s
office. Subsequently, when practically all the strikers had secured clearances from
the fiscal’s office, the Companies readmitted only some but adamantly refused
readmission to 34 officials and members of the Unions who were most active in
the strike, on the ground that they committed “acts inimical to the interest of the
respondents,” without however stating the specific acts allegedly committed. Some
24 of the above number were ultimately notified months later that they were being dismissed
retroactively as of June 2, 1958 and given separation pay checks computed under Rep. Act 1787,
while others (ten in number) up to now have not been readmitted although there have been no
formal dismissal notices given to them.

CIR prosecutor filed a complaint for unfair labor practice against the Companies under Republic
Act 875. The complaint specifically charged the Companies with (1) interfering with the
members of the Unions in the exercise of their right to concerted action, by sending out
individual letters to them urging them to abandon their strike and return to work, with a
promise of comfortable cots, free coffee and movies, and paid overtime, and, subsequently, by
warning them that if they did not return to work on or before June 2, 1958, they might be
replaced; and (2) discriminating against the members of the Unions as regards readmission to
work after the strike on the basis of their union membership and degree of participation in the
strike.

ISSUE: Whether or not respondent company is guilty of ULP

HELD: YES

The act of an employer in notifying absent employees individually during a strike following
unproductive efforts at collective bargaining that the plant would be operated the next day and
that their jobs were open for them should they want to come in has been held to be an unfair
labor practice, as an active interference with the right of collective bargaining through dealing with
the employees individually instead of through their collective bargaining representatives.
Although the union is on strike, the employer is still under obligation to bargain with the union
as the employees’ bargaining representative.

Individual solicitation of the employees or visiting their homes, with the employer or his
representative urging the employees to cease union activity or cease striking, constitutes unfair
labor practice. All the above-detailed activities are unfair labor practices because they tend to
undermine the concerted activity of the employees, an activity to which they are entitled free
from the employer’s molestation.

Indeed, when the respondents offered reinstatement and attempted to “bribe” the strikers with
“comfortable cots,” “free coffee and occasional movies,” “overtime” pay for “work performed in
excess of eight hours,” and “arrangements” for their families, so they would abandon the strike
and return to work, they were guilty of strike-breaking and/or union-busting and, consequently,
of unfair labor practice. It is equivalent to an attempt to break a strike for an employer to offer
reinstatement to striking employees individually, when they are represented by a union, since
the employees thus offered reinstatement are unable to determine what the consequences of
returning to work would be.
ULP also: (super short cut na to) Hiring of Enage and Garcia with attractive compensations;
respondents reclassified 87 employees as supervisors without increase in salary or in
responsibility, in effect compelling these employees to resign from their unions; respondents,
thru their president and manager, respondent Jose M. Olbes, brought three truckloads of non-
strikers and others, escorted by armed men, who, despite the presence of eight entrances to the
three buildings occupied by the Companies, entered thru only one gate less than two meters
wide and in the process, crashed thru the picket line posted in front of the premises of the
Insular Life Building. This resulted in injuries on the part of the picketers and the strike-
breakers; respondents brought against the picketers criminal charges, only three of which were
not dismissed, and these three only for slight misdemeanors. As a result of these criminal
actions, the respondents were able to obtain an injunction from the court of first instance
restraining the strikers from stopping, impeding, obstructing, etc. the free and peaceful use of
the Companies’ gates, entrance and driveway and the free movement of persons and vehicles to
and from, out and in, of the Companies’ buildings.
Verily, the above actuations of the respondents before and after the issuance of the letters,
exhibit A and B, yield the clear inference that the said letters formed of the respondents scheme
to preclude if not destroy unionism within them.

II. The respondents did not merely discriminate against all the strikers in general. They
separated the active from the less active unionists on the basis of their militancy, or lack of it, on
the picket lines. Unionists belonging to the first category were refused readmission even after
they were able to secure clearances from the competent authorities with respect to the criminal
charges filed against them.

It is noteworthy that — perhaps in an anticipatory effort to exculpate themselves from charges of

discrimination in the readmission of strikers returning to work — the respondents delegated the
power to readmit to a committee.

III. Anent the third assignment of error, the record shows that not a single dismissed striker was
given the opportunity to defend himself against the supposed charges against him. As earlier
mentioned, when the striking employees reported back for work on June 2, 1958, the
respondents refused to readmit them unless they first secured the necessary clearances; but
when all, except three, were able to secure and subsequently present the required clearances, the
respondents still refused to take them back.

Indeed, the individual cases of dismissed officers and members of the striking unions do not
indicate sufficient basis for dismissal.

REN Transport
FACTS: Samahan ng Manggagawa sa Ren Transport (SMART) is a registered union, which had a
five-year collective bargaining agreement (CBA) with Ren Transport Corp. (Ren Transport) set
to expire on 31 December 2004. The 60-day freedom period of the CBA passed without a
challenge to SMART’s majority status as bargaining agent. SMART thereafter conveyed its
willingness to bargain with Ren Transport, to which it sent bargaining proposals. Ren
Transport, however, failed to reply to the demand.

Subsequently, two members of SMART wrote to the Department of Labor and Employment —
National Capital Region (DOLE-NCR). The office was informed that a majority of the members
of SMART had decided to disaffiliate from their mother federation to form another union, Ren
Transport Employees Association (RTEA). SMART contested the alleged disaffiliation through a
letter dated 4 April 2005.

During the pendency of the disaffiliation dispute at the DOLE-NCR, Ren Transport stopped the
remittance to SMART of the union dues that had been checked off from the salaries of union
workers as provided under the CBA. Further, on 19 April 2005, Ren Transport voluntarily
recognized RTEA as the sole and exclusive bargaining agent of the rank-and-file employees of
their company.

On 6 July 2005, SMART filed with the labor arbiter a complaint for unfair labor practice against
Ren Transport.

HELD:

Ren Transport violated its duty to bargain collectively with SMART.

Ren Transport concedes that it refused to bargain collectively with SMART. It claims, though,
that the latter ceased to be the exclusive bargaining agent of the rank-and-file employees
because of the disaffiliation of the majority obits members.

The argument deserves no consideration.

Violation of the duty to bargain collectively is an unfair labor practice under Article 258 (g) of
the Labor Code. An instance of this practice is the refusal to bargain collectively as held in
General Milling Corp. v. CA. In that case, the employer anchored its refusal to bargain with and
recognize the union on several letters received by the former regarding the withdrawal of the
workers’ membership from the union. We rejected the defense, saying that the employer had
devised a flimsy excuse by attacking the existence of the union and the status of the union’s
membership to prevent any negotiation. It bears stressing that Ren Transport had a duty to
bargain collectively with SMART. Under Article 263 in relation to Article 267 of the Labor Code,
it is during the freedom period — or the last 60 days before the expiration of the CBA — when
another union may challenge the majority status of the bargaining agent through the filing of a
petition for a certification election. If there is no such petition filed during the freedom period,
then the employer “shall continue to recognize the majority status of the incumbent bargaining
agent where no petition for certification election is filed.”
In the present case, the facts are not up for debate. No petition for certification election
challenging the majority status of SMART was filed during the freedom period, which was from
November 1 to December 31, 2004 — the 60-day period prior to the expiration of the five-year
CBA. SMART therefore remained the exclusive bargaining agent of the rank-and-file employees.

Given that SMART continued to be the workers’ exclusive bargaining agent, Ren Transport had
the corresponding duty to bargain collectively with the former. Ren Transport’s refusal to do so
constitutes an unfair labor practice.

Consequently, Ren Transport cannot avail itself of the defense that SMART no longer represents
the majority of the workers. The fact that no petition for certification election was filed within
the freedom period prevented Ren Transport from challenging SMART’s existence and
membership.

Moreover, it must be stressed that, according to the labor arbiter, the purported disaffiliation
from SMART was nothing but a convenient, self-serving excuse. This factual finding, having
been affirmed by both the CA and the NLRC, is now conclusive upon the Court. We do not see
any patent error that would take the instant case out of the general rule.

Ren Transport interfered with the exercise of the employees’ right to self- organize.

Interference with the employees’ right to self-organization is considered an unfair labor practice
under Article 258 (a) of the Labor Code. In this case, the labor arbiter found that the failure to
remit the union dues to SMART and the voluntary recognition of RTEA were clear indications of
interference with the employees’ right to self-organization. It must be stressed that this finding
was affirmed by the NLRC and the CA; as such, it is binding on the Court, especially when we
consider that it is not tainted with any blatant error. As aptly pointed out by the labor arbiter,
these acts were ill-timed in view of the existence of a labor controversy over membership in the
union.

Ren Transport also uses the supposed disaffiliation from SMART to justify the failure to remit
union dues to the latter and the voluntary recognition of RTEA. However, for reasons already
discussed, this claim is considered a lame excuse that cannot validate those acts.

SMART is not entitled to an award of moral damages.

We hold that the CA correctly dropped the NLRC’s award of moral damages to SMART. Indeed,
a corporation is not, as a general rule, entitled to moral damages. Being a mere artificial being, it
is incapable of experiencing physical suffering or sentiments like wounded feelings, serious
anxiety, mental anguish or moral shock. Although this Court has allowed the grant of moral
damages to corporations in certain situations. it must be remembered that the grant is not
automatic. The claimant must still prove the factual basis of the damage and the causal relation
to the defendant’s acts. In this case, while there is a showing of bad faith on the part of the
employer in the commission of acts of unfair labor practice, there is no evidence establishing the
factual basis of the damage on the part of SMART.
 ARELLANO UNIVERSITY EMPLOYEES AND WORKERS UNION

VS

COURT OF APPEALS

502 SCRA 219 (2006)

An ordinary striking worker may not be declared to have lost his employment status by
mere participation in an illegal strike.

The Arellano University Employees and Workers Union (the Union), the exclusive

bargaining representative of about 380 rank-and-file employees of Arellano University,
Inc. (the University), filed with the National Conciliation and Mediation Board (NCMB)
a Notice of Strike charging the University with Unfair Labor Practice (ULP). After
several controversies and petitions, a strike was staged.

A. Violation of Collective Bargaining Agreement (CBA), Art. V - withholding of union and

death benefits;

b. Violation of CBA, Art. VI - non-granting of ten (10%) percent salary increase to some
union members;

c. Illegal/unauthorized deductions in the payroll;

d. Union interference - circulating letters against the union; and cralawlibrary

e. Non-implementation of the retirement plan as approved by the BIR

Upon the lifting of the strike, the University filed a Petition to Declare the Strike Illegal
before the National Labor Relations Commission (NLRC). The NLRC issued a
Resolution holding that the University was not guilty of ULP. Consequently, the strike
was declared illegal. All the employees who participated in the illegal strike were
thereafter declared to have lost their employment status.

ISSUE:

Whether or not an employee is deemed to have lost his employment by mere

participation in an illegal strike

HELD:

Under Article 264 of the Labor Code, an ordinary striking worker may not be declared to
have lost his employment status by mere participation in an illegal strike. There must be
proof that he knowingly participated in the commission of illegal acts during the strike.
While the University adduced photographs showing strikers picketing outside
the university premises, it failed to identify who they were. It thus failed to meet the
\substantiality of evidence test. applicable in dismissal cases.

With respect to the union officers, as already discussed, their mere participation in the
illegal strike warrants their dismissal.

Digital Telecommunications Philippines v.

Digitel Employees Union
FACTS:

Digitel Employees Union and Digitel commenced collective bargaining negotiations which resulted in a
bargaining deadlock. On despite the order of the Labor Secretary to execute a CBA, still, no CBA was forged
between Digitel and the Union. Some Union members abandoned their employment with Digitel. The Union
later became dormant. 10 years thereafter, Digitel received the President of the Union, a letter containing the
list of officers, CBA proposals and ground rules. Digitel was reluctant to negotiate with the Union and
demanded that the latter show compliance with the provisions of the Union’s Constitution and By-laws on
union membership and election of officers.

The faction filed a case for Preventive Mediation before the NCMB based on Digitel’s violation of the duty to
bargain. During the pendency, Interactive Technology Solutions, Inc. (I-tech) was incorporated. Then, Labor
Secretary assumed jurisdiction over the labor dispute.

During the pendency of the controversy, Digitel Service, Inc. (Digiserv) filed with the DOLE an Establishment
Termination Report stating that it will cease its business operation. The closure affected at least 100
employees, 42 of whom are members of the herein respondent Union.

ISSUE:

Whether or not an employer commits ULP when it closed down one of its enterprises resulting to the
dismissal of the union members pending the assumption order of the Secretary of Labor regarding its duty to
bargain.

RULING:

Yes. Bad faith was manifested by the timing of the closure of Digiserv and the rehiring of some employees to
Interactive Technology Solutions, Inc. (I-tech), a corporate arm of Digitel. The timing of the creation of I-tech
is dubious. It was incorporated while the labor dispute within Digitel was pending. I-tech’s primary purpose
was to provide call center/customer contact service, the same service provided by Digiserv. It conducts its
business inside the Digitel office. The former head of Digiserv is also an officer of I-tech. Thus, when Digiserv
was closed down, some of the employees presumably non-union members were rehired by I-tech.

Thus, the closure of Digiserv pending the existence of an assumption order coupled with the creation of a new
corporation performing similar functions as Digiserv leaves no iota of doubt that the target of the closure are
the union member-employees. These factual circumstances prove that Digitel terminated the services of the
affected employees to defeat their security of tenure. The termination of service was not a valid
retrenchment; it was an illegal dismissal of employees.

It needs to be mentioned too that the dismissal constitutes an unfair labor practice under Article 248(c) of the
Labor Code which refers to contracting out services or functions being performed by union members when
such will interfere with, restrain or coerce employees in the exercise of their rights to self-organization. At the
height of the labor dispute, occasioned by Digitel’s reluctance to negotiate with the Union, I-tech was formed
to provide, as it did pro

BPI EMPLOYEES UNION-DAVAO CITY-FUBU v. BANK OF THE PHILIPPINE ISLANDS

G.R. No. 174912. July 24, 2013 – BARREDO

Petitioner: BPI Employees Union-Davao City-FUBU (BPIEU-Davao City-FUBU)

Respondents: Bank of the Philippine Islands (BPI), and BPI Officers Claro M. Reyes, Cecil Conanan and Gemma Velez

TOPIC: Managerial Prerogatives - change of work hours

Employers Bank of the Philippine Islands

Employee BPI Employees Union-Davao City-FUBU
Unfair labor practice for employer to outsource the positions in the existing
Labor Issue
bargaining unit

DOCTRINE: It is to be emphasized that contracting out of services is not illegal  per se. It is an exercise of business judgment or management
prerogative. Absent proof that the management acted in a malicious or arbitrary manner, the Court will not interfere with the exercise of
judgment by an employer. 

FACTS:

 BOMC, which was primarily engaged in providing and/or handling support services for banks and other financial institutions, is a
subsidiary of the Bank of Philippine Islands operating and functioning as an entirely separate and distinct entity.
 A service agreement between BPI and BOMC was initially implemented in BPI's Metro Manila branches. In this agreement, BOMC
undertook to provide services such as check clearing, delivery of bank statements, fund transfers, card production, operations accounting
and control, and cash servicing, conformably with BSP Circular No. 1388.
 Not a single BPI employee was displaced and those performing the functions, which were transferred to BOMC, were given other
assignments. 
 The Manila chapter of BPI Employees Union then filed a complaint for unfair labor practice. The Labor Arbiter decided the case in
favor of the union. The decision was, however, reversed on appeal by the NLRC. BPIEU-Metro Manila-FUBU filed a petition
for certiorari before the CA which denied it, holding that BPI transferred the employees in the affected departments in the pursuit of its
legitimate business. The employees were neither demoted nor were their salaries, benefits and other privileges diminished. 
 The service agreement was likewise implemented in Davao City.
 Later, a merger between BPI and Far East Bank and Trust Company took effect with BPI as the surviving corporation.
 Thereafter, BPI's cashiering function and FEBTC's cashiering, distribution and bookkeeping functions were handled by BOMC.
 Consequently, twelve (12) former FEBTC employees were transferred to BOMC to complete the latter's service complement.
 BPI Davao's rank and file collective bargaining agent, BPI Employees Union-Davao City-FUBU, objected to the transfer of the
functions and the twelve (12) personnel to BOMC contending that the functions rightfully belonged to the BPI employees and that the
Union was deprived of membership of former FEBTC personnel who, by virtue of the merger, would have formed part of the bargaining
unit represented by the Union pursuant to its union shop provision in the CBA. 
  The Union then filed a formal protest addressed to BPI Vice Presidents Claro M. Reyes and Cecil Conanan reiterating its objection. It
requested the BPI management to submit the BOMC issue to the grievance procedure under the CBA, but BPI did not consider it as
"grievable." Instead, BPI proposed a Labor Management Conference between the parties. 
 During the LMC, BPI invoked management prerogative stating that the creation of the BOMC was to preserve more jobs and to
designate it as an agency to place employees where they were most needed.
 On the other hand, the Union charged that BOMC undermined the existence of the union since it reduced or divided the bargaining unit.
While BOMC employees perform BPI functions, they were beyond the bargaining unit's coverage. In contracting out FEBTC functions
to BOMC, BPI effectively deprived the union of the membership of employees handling said functions as well as curtailed the right of
those employees to join the union.
 Thereafter, the Union demanded that the matter be submitted to the grievance machinery as the resort to the LMC was unsuccessful. As
BPI allegedly ignored the demand, the Union filed a notice of strike before the National Conciliation and Mediation Board.
 BPI then filed a petition for assumption of jurisdiction/certification with the Secretary of the Department of Labor and Employment, who
subsequently issued an order certifying the labor dispute to the NLRC for compulsory arbitration.

CONTENTION OF PETITIONER:

 The outsourcing of jobs included in the existing bargaining unit to BOMC is a breach of the union-shop agreement in the CBA.
 In transferring the former employees of FEBTC to BOMC instead of absorbing them in BPI as the surviving corporation in the merger,
the number of positions covered by the bargaining unit was decreased, resulting in the reduction of the Union's membership.
 The CBA covers the agreement with respect, not only to wages and hours of work, but to all other terms and conditions of work. The
union shop clause, being part of these conditions, states that the regular employees belonging to the bargaining unit, including those
absorbed by way of the corporate merger, were required to join the bargaining union "as a condition for employment."
 While they admitted that BPI has the prerogative to determine what should be done to meet the exigencies of business, the exercise of
management prerogative is not absolute, thus, requiring good faith and adherence to the law and the CBA.
 It is unfair labor practice for an employer to outsource the positions in the existing bargaining unit. 

CONTENTION OF RESPONDENTS:

 The service agreement with BOMC is valid on three (3) grounds: 1] that it was pursuant to the prevailing law at that time, CBP Circular
No. 1388; 2] that the creation of BOMC was within management prerogatives intended to streamline the operations and provide focus
for BPI's core activities; and 3] that the Union recognized, in its CBA, the exclusive right and prerogative of BPI to conduct the
management and operation of its business. 

RULING OF THE LOWER TRIBUNAL:

 NLRC – upheld the validity of the service agreement between BPI and BOMC and dismissing the charge of ULP
o The engagement by BPI of BOMC to undertake some of its activities was clearly a valid exercise of its management
prerogative. 
o The spinning off by BPI to BOMC of certain services and functions did not interfere with, restrain or coerce employees in the
exercise of their right to self-organization.
 CA – affirmed the NLRC's Resolution
o Considering the ramifications of the corporate merger, it was well within BPI's prerogatives "to determine what additional tasks
should be performed, who should best perform it and what should be done to meet the exigencies of business." 

ISSUE: Whether the act of BPI to outsource the cashiering, distribution and bookkeeping functions to BOMC is in conformity with the law and
the existing CBA. – YES.

RULING + RATIO:

The Union claims that a union shop agreement is stipulated in the existing CBA, citing the case of Shell Oil Workers' Union v. Shell Company of
the Philippines, Ltd.; however, the Union's reliance on the case is misplaced. The rule now is covered by Article 261 of the  Labor Code,which
took effect on November 1, 1974.  Article 261 provides:

ART. 261. Jurisdiction of Voluntary Arbitrators or panel of Voluntary Arbitrators. — . . .

Accordingly, violations of a Collective Bargaining Agreement, except those which are gross in character, shall no
longer be treated as unfair labor practice and shall be resolved as grievances under the Collective Bargaining
Agreement. For purposes of this article, gross violations of Collective Bargaining Agreement shall mean flagrant
and/or malicious refusal to comply with the economic provisions of such agreement. [Emphases supplied]

Clearly, only gross violations of the economic provisions of the CBA are treated as ULP. Otherwise, they are mere grievances.
In the present case, the alleged violation of the union shop agreement in the CBA, even assuming it was malicious and flagrant, is not a violation
of an economic provision in the agreement. The provisions relied upon by the Union were those articles referring to the recognition of the union
as the sole and exclusive bargaining representative of all rank-and-file employees, as well as the articles on union security, specifically, the
maintenance of membership in good standing as a condition for continued employment and the union shop clause. It failed to take into
consideration its recognition of the bank's exclusive rights and prerogatives, likewise provided in the CBA, which included the hiring of
employees, promotion, transfers, and dismissals for just cause and the maintenance of order, discipline and efficiency in its operations. 

The Union, however, insists that jobs being outsourced to BOMC were included in the existing bargaining unit, thus, resulting in a reduction of a
number of positions in such unit. The reduction interfered with the employees' right to self-organization because the power of a union primarily
depends on its strength in number. 

It is incomprehensible how the "reduction of positions in the collective bargaining unit" interferes with the employees' right to self-organization
because the employees themselves were neither transferred nor dismissed from the service. As the NLRC clearly stated: In the case at hand, the
union has not presented even an iota of evidence that petitioner bank has started to terminate certain employees, members of the union. In fact,
what appears is that the Bank has exerted utmost diligence, care and effort to see to it that no union member has been terminated . In the process
of the consolidation or merger of the two banks which resulted in increased diversification of functions, some of these non-banking functions
were merely transferred to the BOMC without affecting the union membership.  BPI also stresses that not a single employee or union member
was or would be dislocated or terminated from their employment as a result of the Service Agreement.  Neither had it resulted in any diminution
of salaries and benefits nor led to any reduction of union membership.

It is to be emphasized that contracting out of services is not illegal per se. It is an exercise of business judgment or management prerogative.
Absent proof that the management acted in a malicious or arbitrary manner, the Court will not interfere with the exercise of judgment by an
employer. In this case, bad faith cannot be attributed to BPI because its actions were authorized by CBP Circular No. 1388, Series of 1993  issued
by the Monetary Board of the then Central Bank of the Philippines.

GERARDO F. RIVERA, ET. AL, VS. EDGARDO ESPIRITU, ET. AL.

Justice Quisumbing, 23 January 2002

FACTS:
On June 1998, PAL pilots affiliated with the Airline Pilots Association of the Philippines (ALPAP) went on a strike, causing
serious losses to the financially beleaguered flag carrier. Faced with bankruptcy, PAL adopted a rehabilitation plan and downsized
its labor force by more than one-third.
On July 1998, the PAL Employees Association (PALEA) went on strike to protest the retrenchment measures adopted by
the airline, which affected 1,899 union members. The strike ended four days later, when PAL and PALEA agreed to a more
systematic reduction in PAL’s work force and the payment of separation benefits to all retrenched employees.
On August 1998, then President Estrada issued A.O. 16 creating an Inter-Agency Task Force (Task Force) to address the
problems of the ailing flag carrier. The Task Force was composed of different departments. Edgardo Espiritu, then the Secretary of
Finance, was designated chairman of the Task Force. Conciliation meetings were then held between PAL management and the
three unions representing the airline’s employees, with the Task Force as mediator.
On September 1998, PAL management submitted to the Task Force an offer by Lucio Tan, Chairman and CEO of PAL, of
a plan to transfer shares of stock to its employees. The Directors of PALEA voted to accept Tan’s offer and requested the Task
Force’s assistance in implementing the same. Union members, however, rejected Tan’s offer. Under intense pressure from PALEA
members, the union’s directors subsequently resolved to reject Tan’s offer.
PAL informed the Task Force that it was shutting down its operations preparatory to liquidating its assets and paying off
its creditors. The airline claimed that given its labor problems, rehabilitation was no longer feasible, and hence, the airline had no
alternative but to close shop. PALEA sought the intervention of the Office of the President in immediately convening the parties to
prevent the imminent closure of PAL.
PALEA informed DOLE that it had no objection to a referendum on the Tan’s offer. However, the votes rejecting the offer
won. Consequently, PAL ceased its operations and sent notices of termination to its employees.
The PALEA board wrote President Estrada anew, seeking his intervention. PALEA offered a 10-year moratorium on
strikes and similar actions and a waiver of some of the economic benefits in the existing CBA . Tan, however, rejected this counter-
offer.
 On 27 September 1998, the PALEA board again wrote the President proposing another set of terms and conditions,
subject to ratification by the general membership. Among the signatories to the letter were herein petitioners Rivera, Ramiso, and
Aranas, as officers and/or members of the PALEA Board of Directors. PAL management accepted the PALEA proposal and the
necessary referendum was scheduled.
On October 2, 1998, 5,324 PALEA members cast their votes in a DOLE-supervised referendum. Of the votes cast, 61%
were in favor of accepting the PAL-PALEA agreement, while 34% rejected it. So, PAL resumed domestic operations.
On the same date, seven officers and members of PALEA filed this instant petition to annul the September 27, 1998
agreement entered into between PAL and PALEA.

Petitioner’s Allegations
 The controverted PAL-PALEA agreement is void because it abrogated the right of workers to self-organization and their right to
collective bargaining
 The agreement was not meant merely to suspend the existing PAL-PALEA CBA, which expires on September 30, 2000, but
also to foreclose any renegotiation or any possibility to forge a new CBA for a decade or up to 2008. It violates the “protection
to labor” policy laid down by the Constitution.

ISSUE AND HOLDING:

Whether or not the PAL-PALEA agreement of 27 September 1998, stipulating the suspension of the PAL-PALEA CBA
unconstitutional and contrary to public policy. NO, the agreement is a valid exercise of the freedom to contract

RATIO:

Discussion
A CBA is “a contract executed upon request of either the employer or the exclusive bargaining representative
incorporating the agreement reached after negotiations with respect to wages, hours of work and all other terms and conditions of
employment, including proposals for adjusting any grievances or questions arising under such agreement.” The primary purpose of
a CBA is the stabilization of labor-management relations in order to create a climate of a sound and stable industrial peace. In
construing a CBA, the courts must be practical and realistic and give due consideration to the context in which it is
negotiated and the purpose which it is intended to serve.

In the case at hand…

The assailed PAL-PALEA agreement was the result of voluntary collective bargaining negotiations undertaken in the light
of the severe financial situation faced by the employer, with the peculiar and unique intention of not merely promoting industrial
peace at PAL, but preventing the latter’s closure. The Court finds no conflict between said agreement and Article 253-A of the
Labor Code.
Article 253-A has a two-fold purpose. One is to promote industrial stability and predictability. Inasmuch as the agreement
sought to promote industrial peace at PAL during its rehabilitation, said agreement satisfies the first purpose of Article 253-A. The
other is to assign specific timetables wherein negotiations become a matter of right and requirement. Nothing in Article 253-A,
prohibits the parties from waiving or suspending the mandatory timetables and agreeing on the remedies to enforce the
same.

In the instant case, it was PALEA, as the exclusive bargaining agent of PAL’s ground employees, that voluntarily entered into the
CBA with PAL. It was also PALEA that voluntarily opted for the 10-year suspension of the CBA. Either case was the union’s
exercise of its right to collective bargaining. The right to free collective bargaining, after all, includes the right to suspend it.
The acts of public respondents in sanctioning the 10-year suspension of the PAL-PALEA CBA did not contravene the
“protection to labor” policy of the Constitution. The agreement afforded full protection to labor; promoted the shared responsibility
between workers and employers; and the exercised voluntary modes in settling disputes, including conciliation to foster industrial
peace."

Petitioner’s Argument: The 10-year suspension of the CBA under the PAL-PALEA agreement virtually installed PALEA as a
company union for said period, amounting to unfair labor practice, in violation of Article 253-A of the Labor Code mandating that an
exclusive bargaining agent serves for five years only.

The questioned proviso of the agreement reads:

a. PAL shall continue recognizing PALEA as the duly certified-bargaining agent of the regular rank-and-file ground
employees of the Company;
b. The ‘union shop/maintenance of membership’ provision under the PAL-PALEA CBA shall be respected.

SC: The aforesaid provisions, taken together, clearly show the intent of the parties to maintain “union security” during the period of
the suspension of the CBA. Its objective is to assure the continued existence of PALEA during the said period. The Court is unable
to declare the objective of union security an unfair labor practice. It is State policy to promote unionism to enable workers to
negotiate with management on an even playing field and with more persuasiveness than if they were to individually and separately
bargain with the employer. For this reason, the law has allowed stipulations for “union shop” and “closed shop” as means of
encouraging workers to join and support the union of their choice in the protection of their rights and interests vis-à-vis the employer.

Petitioner’s Argument: The agreement installs PALEA as a virtual company union

SC: This is untenable.
 Under Article 248 (d) of the Labor Code, a company union exists when the employer acts “[t]o initiate, dominate, assist or
otherwise interfere with the formation or administration of any labor organization, including the giving of financial or other
support to it or its organizers or supporters.” The case records are bare of any showing of such acts by PAL.

Petitioner’s Argument: The agreement violates the five-year representation limit mandated by Article 253-A.
SC: No, it does not.
 Under Article 235-A, the representation limit for the exclusive bargaining agent applies only when there is an extant
CBA in full force and effect. In the instant case, the parties agreed to suspend the CBA and put in abeyance the
limit on the representation period.

In sum, we are of the view that the PAL-PALEA agreement dated September 27, 1998, is a valid exercise of the freedom to
contract. Under the principle of inviolability of contracts guaranteed by the Constitution, the contract must be upheld.

Great Pacific Life Employees Union v. Great Pacific Life Assurance Corporation

Facts: 

 Prior to the expiration of the CBA, the Parties submitted their respective proposals for its projected renewal. However,
it ended to a deadlock. Thus, the Union proceeded to stage a strike employing some violence and blocking all points
of ingress and egress of the Company’s premises.
 In view thereof, the GREPALIFE directed the Union to explain why no disciplinary action, including possible
dismissal from employment, should be taken against them for committing illegal acts against the company in the
course of the strike. In response, the Union asserted that they were just exercising their right to strike, while the other
striking employees ignored the same.
 The GREPALIFE found Union’s explanations unacceptable, thus terminating its officers and employees.
 Eventually, the Parties entered into a MOA, where GREPALIFE requested, among others, for the voluntary resignation
of President and Vice-President of the Union, Mr. Domingo and Mr. Dela Rosa, respectively, in exchange for the
reinstatement of all other strikers. Thus, prompting Mr. Dela Rosa to file a complaint against GREPALIFE for illegal
dismissal and ULP. The Labor Arbiter sided for the Union’s Officers, while the NLRC reversed the former’s
decision, contending that a just cause for dismissal had been sufficiently established.  However, it agreed that
GREPALIFE failed to comply strictly with the requirements of due process prior to termination, thus awarding the
Union‘s Officers its monetary benefits. Hence, Mr. Dela Rosa’s Petition.
 Issue: Whether the NLRC erred in its decision.

Held: No. The NLRC did not err and GREPALIFE is not guilty of the acts charged.

Ratio: The Supreme Court holds that the NLRC did not commit grave abuse of discretion.  The right to strike, while
constitutionally recognized, is not without legal constrictions. The Labor Code is emphatic against the use of violence,
coercion and intimidation during a strike and to this end prohibits the obstruction of free passage to and from the
employer’s premises for lawful purposes.  The sanction provided in par. (a) of Art. 264 thereof is so severe that  “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.

GREPALIFE submitted before the Labor Arbiter several affidavits of its employees which de la Rosa did not
refute.  With these documents, two (2) specifically described the incidents that transpired during the strike that the
Union’s Officers and Employees had participated and employed such illegal acts. Thus, declaring the staged strike
illegal and from that will not constitute ULP.

Fallo: The petition is DISMISSED.  The decision of respondent National Labor Relations Commission dated 14 May
1996 (a) finding that petitioner Rodel P. de la Rosa was legally dismissed, and, (b) ordering respondent Great Pacific
Life Assurance Corporation to pay petitioner his one (1) month salary for its failure to comply strictly with due
process prior to the latter’s termination and his one (1) month salary per year of service based on the new CBA rates
as separation pay, as well as its Resolution dated 16 August 1996 denying reconsideration, is  AFFIRMED.

A.C. RANSOM LABOR UNION vs. NLRC, A.C. AUTHOR: CHA

RANSOM PHILS. CORP., RUBEN HERNANDEZ ET. NOTES:
AL. [G.R. No. L-69494, June 10, 1986] Article 265 of the LC: Any worker whose employment has
been terminated as a consequence of an unlawful lockout
TOPIC: Definition: Employer & Employee shall be entitled to reinstatement with full back wages.
PONENTE: Melencio-Herrera - Article 273 of the LC: Any person violating any of the
provisions of Article 265 of this Code shall be punished by a
fine of not exceeding five hundred pesos and/or
imprisonment for not less than one (1) day nor more than six
(6) months.
FACTS:
- A. C. RANSOM (Phils.) Corp. (RANSOM), was established in 1933 by Maximo Hernandez Sr. It was a family
corporation so stockholders are members of Hernandez family and engaged in manufacture mainly of ink and articles
related to ink.
- In 1961, employees of RANSOM, most members of herein petitioner UNION, went on strike and established a picket
line. When it was lifted, most were allowed to resume to work except for the 22 workers, which the Company refused to
reinstate.
- In 1969, Hernandez family organized Rosario Industrial Corp. (ROSARIO) in same compound and nature of business
with RANSOM. In 1972, the Court of Industrial Relations ordered RANSOM, its officers and agents to reinstate the 22
workers, but in 1973, RANSOM applied for clearance to close, which was granted by the Ministry of Labor and
Employment without prejudice to the right of employees to seek redress of grievance.
- In 1974, backwages of the 22 workers were computed (164K) so petitioner UNION filed motions for execution (up to 10
motions) but could not be implemented for failure to find leviable assets of RANSOM.
- Hence, last Motion of Execution filed asked its officers and agents to be held personally liable for the payment of
backwages. LA (GENILO ORDER) granted and ordered 7 officers and directors of the Company liable (herein private
respondents). NLRC affirmed LA with modification that in absence of proof that the officers exceeded their authority, writ
of execution cannot be enforced against them. Hence, this petition.
ISSUE: WON the judgment against the Corporation to reinstate employees with backwages enforceable against its agents
and officers in their individual, private and personal capacities?

HELD: YES. Court set aside NLRC ruling and reinstated GENILO ORDER with modification that personal liability for
the backwages of the 22 strikers be limited to Ruben Hernandez (President of RANSOM in 1974), jointly and severally
with other Presidents of RANSOM from 1972 up to the time corporate life was terminated.
RATIO:
- If the employer is a corporation, Article 212 (c) of the Labor Code provides: 'Employer includes any person acting in
the interest of an employer directly or indirectly. The term shall not include any labor organization or any of its
officers or agents except when acting as employer.
- Since RANSOM is an artificial person, it must have an officer who can be presumed to be the employer, being the
"person acting in the interest of employer". The responsible officer of an employer corporation can be held
personally, not to say even criminally, liable for non-payment of back wages, which is provided in the Minimum
Wage Law, Section 15(b): If any violation of this Act is committed by a corporation, trust, partnership or
association, the manager or in his default, the person acting as such when the violation took place, shall be
responsible. In the case of a government corporation, the managing head shall be made responsible, except when
shown that the violation was due to an act or commission of some other person, over whom he has no control, in
which case the latter shall be held responsible.
- In PD 525, where a corporation fails to pay the emergency allowance therein provided, the prescribed penalty "shall
be imposed upon the guilty officer or officers" of the corporation.
- The record does not clearly Identify "the officer or officers" of RANSOM directly responsible for failure to pay the back
wages of the 22 strikers. In the absence of definite proof in that regard, we believe it should be presumed that the
responsible officer is the President of the corporation who can be deemed the chief operation officer thereof. Thus, in
RA 602, criminal responsibility is with the "Manager" or in his default, the person acting as such. In RANSOM, the
President appears to be the Manager.
- Since non-payment of the back wages of the 22 strikers has been a continuing situation, personal liability of the
RANSOM President, at the time the back wages were ordered should also be a continuing joint and several personal
liabilities of all who may have thereafter succeeded to the office of president. Otherwise, the 22 strikers may be deprived
of their rights by the election of a president without leviable assets.
CASE LAW/ DOCTRINE:
DISSENTING/CONCURRING OPINION(S):
STANDARD CHARTERED BANK EMPLOYEES UNION (NUBE) vs. The Honorable MA. NIEVES R. CONFESOR,
in her capacity as SECRETARY OF LABOR AND EMPLOYMENT; and the STANDARD CHARTERED BANK

G.R.No. 114974 June 16, 2004

FACTS: Before the commencement of the negotiation for the new CBA between the bank and the Union,
the Union, through Divinagracia, suggested to the Bank’s Human Resource Manager and head of the
negotiating panel, Cielito Diokno, that the bank lawyers should be excluded from the negotiating team.
The Bank acceded. Meanwhile, Diokno(head of the negotiating team for the bank) suggested to
Divinagracia that Jose P. Umali, Jr., the President of the National Union of Bank Employees (NUBE), the
federation to which the Union was affiliated, be excluded from the Union’s negotiating panel. However,
Umali was retained as a member thereof.

There was deadlock in the negotiations. Both parties alleged ULP. Bank alleged that the Union violated
its no strike- no lockout clause by filing a notice of strike before the NCMB. Considering that the filing of
notice of strike was an illegal act, the Union officers should be dismissed. Union alleged unfair labor
practice when the bank allegedly interfered with the Union’s choice of negotiator. It argued that,
Diokno’s suggestion that the negotiation be limited as a “family affair” was tantamount to suggesting
that Federation President Jose Umali, Jr. be excluded from the Union’s negotiating panel. It further
argued that, damage or injury to the public interest need not be present in order for unfair labor
practice to prosper. The Union also contended that the Bank merely went through the motions of
collective bargaining without the intent to reach an agreement

ISSUE:

WON there was interference

WON the bank committed “surface bargaining”

HELD:

NONE

Article 248(a) of the Labor Code, considers it an unfair labor practice when an employer interferes,
restrains or coerces employees in the exercise of their right to self-organization or the right to form
association. The right to self-organization necessarily includes the right to collective bargaining.
Parenthetically, if an employer interferes in the selection of its negotiators or coerces the Union to
exclude from its panel of negotiators a representative of the Union, and if it can be inferred that the
employer adopted the said act to yield adverse effects on the free exercise to right to self-organization
or on the right to collective bargaining of the employees, ULP under Article 248(a) in connection with
Article 243 of the Labor Code is committed.

In order to show that the employer committed ULP under the Labor Code, substantial evidence is
required to support the claim. Substantial evidence has been defined as such relevant evidence as a
reasonable mind might accept as adequate to support a conclusion. In the case at bar, the Union bases
its claim of interference on the alleged suggestions of Diokno to exclude Umali from the Union’s
negotiating panel.

The circumstances that occurred during the negotiation do not show that the suggestion made by
Diokno to Divinagracia is an anti-union conduct from which it can be inferred that the Bank consciously
adopted such act to yield adverse effects on the free exercise of the right to self-organization and
collective bargaining of the employees, especially considering that such was undertaken previous to the
commencement of the negotiation and simultaneously with Divinagracia’s suggestion that the bank
lawyers be excluded from its negotiating panel.

The records show that after the initiation of the collective bargaining process, with the inclusion of
Umali in the Union’s negotiating panel, the negotiations pushed through. The complaint was made only
on August 16, 1993 after a deadlock was declared by the Union on June 15, 1993.

It is clear that such ULP charge was merely an afterthought. The accusation occurred after the
arguments and differences over the economic provisions became heated and the parties had become
frustrated. It happened after the parties started to involve personalities. As the public respondent
noted, passions may rise, and as a result, suggestions given under less adversarial situations may be
colored with unintended meanings. Such is what appears to have happened in this case.
NO. Surface bargaining is defined as “going through the motions of negotiating” without any legal intent
to reach an agreement.”

The Union alleges that the Bank violated its duty to bargain; hence, committed ULP under Article 248(g)
when it engaged in surface bargaining. It alleged that the Bank just went through the motions of
bargaining without any intent of reaching an agreement, as evident in the Bank’s counter-proposals. It
explained that of the 34 economic provisions it made, the Bank only made 6 economic
counterproposals. Further, as borne by the minutes of the meetings, the Bank, after indicating the
economic provisions it had rejected, accepted, retained or were open for discussion, refused to make a
list of items it agreed to include in the economic package.

The minutes of meetings from March 12, 1993 to June 15, 1993 do not show that the Bank had any
intention of violating its duty to bargain with the Union. Records show that after the Union sent its
proposal to the Bank on February 17, 1993, the latter replied with a list of its counter-proposals on
February 24, 1993. Thereafter, meetings were set for the settlement of their differences. The minutes of
the meetings show that both the Bank and the Union exchanged economic and non-economic proposals
and counter-proposals.

The Union has not been able to show that the Bank had done acts, both at and away from the
bargaining table, which tend to show that it did not want to reach an agreement with the Union or to
settle the differences between it and the Union. Admittedly, the parties were not able to agree and
reached a deadlock. However, it is herein emphasized that the duty to bargain “does not compel either
party to agree to a proposal or require the making of a concession.”

Hence, the parties’ failure to agree did not amount to ULP under Article 248(g) for violation of the duty
to bargain.

NOTE: (on the allegation of the bank’s refusal to give certain information) The Union, did not, as the
Labor Code requires, send a written request for the issuance of a copy of the data about the Bank’s rank
and file employees. Moreover, as alleged by the Union, the fact that the Bank made use of the aforesaid
guestimates, amounts to a validation of the data it had used in its presentation.
Employees Union of Bayer v. Bayer
FACTS:

During the negotiations, EUBP rejected Bayer’s 9.9% wage-increase proposal resulting in a bargaining
deadlock. And the former staged a strike, prompting the Secretary of DOLE to assume jurisdiction over
the dispute. Pending the resolution of the dispute, respondent Avelina Remigio (Remigio) and 27 other
union members, without any authority from their union leaders, accepted Bayer’s wage-increase
proposal. EUBP’s grievance committee questioned Remigio’s action and reprimanded Remigio and her
allies. After a while, the DOLE Secretary issued an arbitral award ordering EUBP and Bayer to execute a
CBA.

Meanwhile, barely six months from the signing of the new CBA, during a company-sponsored seminar,6
Remigio solicited signatures from union members in support of a resolution. containing the decision of
the signatories to: (1) disaffiliate from FFW, (2) rename the union as Reformed Employees Union of
Bayer Philippines (REUBP), (3) adopt a new constitution and by-laws for the union, (4) abolish all existing
officer positions in the union and elect a new set of interim officers, and (5) authorize REUBP to
administer the CBA between EUBP and Bayer.7 The said resolution was signed by 147 of the 257 local
union members. A subsequent resolution was also issued affirming the first resolution.

A tug-of-war then ensued between the two rival groups, with both seeking recognition from Bayer and
demanding remittance of the union dues collected from its rank-and-file members. Bayer remitted the
union dues to REUBP and later on they agreed to sign a new CBA. LA and NLRC dismissed the complaints
for ULP on the ground of lack of jurisdiction

ISSUE:

Whether or not an employer commits ULP when it signed a new CBA with a new union considering there
is an existing valid CBA

RULING:

Yes. In the case at bar, the Supreme Court ruled that it must be remembered that a CBA is entered into
in order to foster stability and mutual cooperation between labor and capital. An employer should not
be allowed to rescind unilaterally its CBA with the duly certified bargaining agent it had previously
contracted with, and decide to bargain anew with a different group if there is no legitimate reason for
doing so and without first following the proper procedure. If such behavior would be tolerated,
bargaining and negotiations between the employer and the union will never be truthful and meaningful,
and no CBA forged after arduous negotiations will ever be honored or be relied upon.

On the matter of damages prayed for by the petitioners, we have held that as a general rule, a
corporation cannot suffer nor be entitled to moral damages. A corporation, and by analogy a labor
organization, being an artificial person and having existence only in legal contemplation, has no feelings,
no emotions, no senses; therefore, it cannot experience physical suffering and mental anguish. Mental
suffering can be experienced only by one having a nervous system and it flows from real ills, sorrows,
and griefs of life – all of which cannot be suffered by an artificial, juridical person.

NUWHRAIN Dusit Hotel v. Court of

Appeals
FACTS:

The Union is the certified bargaining agent of the regular rank-and-file employees of Dusit Hotel Nikko
(Hotel).

On October 24, 2000, the Union submitted its Collective Bargaining Agreement (CBA) negotiation
proposals to the Hotel. As negotiations ensued, the parties failed to arrive at mutually acceptable terms
and conditions. Due to the bargaining deadlock, the Union, on December 20, 2001, filed a Notice of
Strike on the ground of the bargaining deadlock with the National Conciliation and Mediation Board
(NCMB)

Thereafter, conciliation hearings were conducted which proved unsuccessful.

Soon thereafter, in the afternoon of January 17, 2002, the Union held a general assembly at its office
located in the Hotels basement, where some members sported closely cropped hair or cleanly shaven
heads.
The next day, or on January 18, 2002, more male Union members came to work sporting the same hair
style. The Hotel prevented these workers from entering the premises claiming that they violated the
Hotels Grooming Standards.

In view of the Hotels action, the Union staged a picket outside the Hotel premises. Later, other workers
were also prevented from entering the Hotel causing them to join the picket. For this reason the Hotel
experienced a severe lack of manpower which forced them to temporarily cease operations in three
restaurants.

Consequently, the Hotel issued notices to Union members, preventively suspending them and charging
them with the following offenses: (1) violation of the duty to bargain in good faith; (2) illegal picket; (3)
unfair labor practice; (4) violation of the Hotels Grooming Standards; (5) illegal strike; and (6)
commission of illegal acts during the illegal strike.

The next day, the Union filed with the NCMB a second Notice of Strike on the ground of unfair labor
practice and violation of Article 248(a) of the Labor Code on illegal lockout

The Hotel terminated the services of 29 Union officers and 61 members; and suspended 81 employees
for 30 days, forty-eight 48 employees for 15 days, 4) employees for 10 days, and 3 employees for five
days. On the same day, the Union declared a strike. Starting that day, the Union engaged in picketing the
premises of the Hotel. During the picket, the Union officials and members unlawfully blocked the ingress
and egress of the Hotel premises.

The Union filed its third Notice of Strike with the NCMB, this time on the ground of unfair labor practice
and union-busting.

NLRC Decision: It ordered the Hotel and the Union to execute a CBA within 30 days from the receipt of
the decision. NLRC ruled that the strike conducted was illegal.

ISSUE: W/N the Union is guilty for illegal strike

RULING: YES.

First, the Unions violation of the Hotels Grooming Standards was clearly a deliberate and concerted
action to undermine the authority of and to embarrass the Hotel and was, therefore, not a protected
action. The appearances of the Hotel employees directly reflect the character and well-being of the
Hotel, being a five-star hotel that provides service to top-notch clients. It can be gleaned from the
records before us that the Union officers and members deliberately and in apparent concert shaved
their heads or cropped their hair. This was shown by the fact that after coming to work on January 18,
2002, some Union members even had their heads shaved or their hair cropped at the Union office in the
Hotels basement. Clearly, the decision to violate the company rule on grooming was designed and
calculated to place the Hotel management on its heels and to force it to agree to the Unions proposals.
This Court is of the opinion, therefore, that the act of the Union was not merely an expression of their
grievance or displeasure but, indeed, a calibrated and calculated act designed to inflict serious damage
to the Hotels finances or its reputation. Thus, we hold that the Unions concerted violation of the Hotels
Grooming Standards which resulted in the temporary cessation and disruption of the Hotels operations
is an unprotected act and should be considered as an illegal strike.

Second, the Unions concerted action which disrupted the Hotels operations clearly violated the CBAs No
Strike, No Lockout provision. The facts are clear that the strike arose out of a bargaining deadlock in the
CBA negotiations with the Hotel. The concerted action is an economic strike upon which the afore-
quoted no strike/work stoppage and lockout prohibition is squarely applicable and legally binding.

RELEVANT TO THE TOPIC REGARDING CONCILITION: Third, the Union officers and members concerted
action to shave their heads and crop their hair not only violated the Hotels Grooming Standards but also
violated the Unions duty and responsibility to bargain in good faith. By shaving their heads and cropping
their hair, the Union officers and members violated then Section 6, Rule XIII of the Implementing Rules
of Book V of the Labor Code. This rule prohibits the commission of any act which will disrupt or impede
the early settlement of the labor disputes that are under conciliation. Since the bargaining deadlock is
being conciliated by the NCMB, the Unions action to have their officers and members heads shaved was
manifestly calculated to antagonize and embarrass the Hotel management and in doing so effectively
disrupted the operations of the Hotel and violated their duty to bargain collectively in good faith.

Fourth, the Union failed to observe the mandatory 30-day cooling-off period and the seven-day strike
ban before it conducted the strike on January 18, 2002. The NLRC correctly held that the Union failed to
observe the mandatory periods before conducting or holding a strike. Records reveal that the Union
filed its Notice of Strike on the ground of bargaining deadlock on December 20, 2001. The 30-day
cooling-off period should have been until January 19, 2002. On top of that, the strike vote was held on
January 14, 2002 and was submitted to the NCMB only on January 18, 2002; therefore, the 7-day strike
ban should have prevented them from holding a strike until January 25, 2002. The concerted action
committed by the Union on January 18, 2002 which resulted in the disruption of the Hotels operations
clearly violated the above-stated mandatory periods.

Last, the Union committed illegal acts in the conduct of its strike. The NLRC ruled that the strike was
illegal since, as shown by the pictures presented by the Hotel, the Union officers and members formed
human barricades and obstructed the driveway of the Hotel. There is no merit in the Unions argument
that it was not its members but the Hotels security guards and the police officers who blocked the
driveway, as it can be seen that the guards and/or police officers were just trying to secure the entrance
to the Hotel. The pictures clearly demonstrate the tense and highly explosive situation brought about by
the strikers presence in the Hotels driveway.
Interphil Laboratories Ee Union vs Interphil Laboratories

Facts:

Petitioner is the sole and exclusive bargaining agent of the rank-and-file employees of Respondent. They
had a CBA.

Prior to the expiration of the CBA, respondent company was approached by the petitioner, through its
officers. The Union 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.

All the rank-and-file employees of the company refused to follow their regular two-shift work schedule.
The employees stopped working and left their workplace without sealing the containers and securing
the raw materials they were working on.

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.

Respondent company filed with the National NLRC a petition to declare illegal petitioner union’s
“overtime boycott” and “work slowdown” which, according to respondent company, amounted to illegal
strike. It also filed with Office Secretary of Labor a petition for assumption

of jurisdiction. Secretary of Labor Nieves Confesor issued an assumption order over the labor dispute.

Labor Arbiter Caday submitted his recommendation to the then Secretary of Labor Leonardo A.
Quisumbing. Then Secretary Quisumbing approved and adopted the report in his Order, finding illegal
strike on the part of petitioner Union.

Issue: WON the Labor Secretary has jurisdiction to rule over an illegal strike.

Held:

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 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.

The appellate court also correctly held that the question of the Secretary of Labor and Employment’s
jurisdiction over labor-related disputes was already settled in International 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 x x x.’
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, ‘it 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.
1. YES. Petitioner union maintained that the Labor Arbiter and the appellate court
disregarded the “parol evidence rule” when 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 a.m. 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. 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. 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 case, the CBA said that the work hours could change at the company’s discretion.
Also, the employees were aware, and in fact complied with the 12 hours shifts. Their
own witnesses show this.

As stated in the facts, it’s clear that the actions taken by the union amounted to illegal
strike. They also cited a testimony of a union member where he said that the union
officers called for a stop to the overtime activities. When he disregarded it and actually
went to work, he was branded a traitor by the union officers and was shouted at.
The union also claimed that they had no hand in the work slowdown – there was no
change in performance/efficiency for the year 1993. This was rebutted by their own
witness. She could not answer how she prepared the productivity reports, because she
was on union leave. She had no knowledge of some of the reports. Even then, the
comparison is undeniably of no moment. The boycott and work slowdown resulted in
financial loss and damage to its reputation.
The SC classified the acts by the union as a ‘strike on installment basis.’ 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. In Ilaw at Buklod ng Manggagawa vs.
NLRC, the court ruled that Slowdown is an inherently illegal activity wherein the workers
purposely remain at their positions and accept wages, but at the same time, select what
parts of their allotted task they want to perform, and refuse to do other work.
Ramirez vs. Polyson Industries, Inc.
G.R. No. 207898
October 19, 2016

Petitioners: ERROL RAMIREZ, JULITO APAS, RICKY ROSELO and ESTEBAN MISSION, JR.

Respondents: POLYSON INDUSTRIES, INC. and WILSON S. YU

Ponente: PERALTA, J.

FACTS
1. Petitioners, on the other hand, were employees of Polyson and were officers of Obrero Pilipino
(Obrero), the union of the employees of Polyson
2. Labor dispute certified by SOLE to NLRC for compulsory arbitration
3. In its position paper, the Company alleged:
a. It received a notice of hearing for PCE from DOLE
 b. Company and Union officers met, led by petitioner Union President Ramirez
c. Union asked that it be voluntarily recognized by Polyson as the exclusive bargaining
agent of the rank-and-file employees of Polyson
i. Company refused and asked for PCE instead
d. Union officers threatened management that the union will show its collective strength
in the coming days
e. A few days later, the Company received a rush order for production of 100k plastic bags
f. Management informed the operators of its Cutting Section that they would be needing
workers to work OT because of the said order
i. Based on the usual practice of the company, those who intend to perform OT
work were expected to sign the “time sheet” indicating their willingness to work
after their shift
g. The supervisors approached the operators but were told that they would be unable to
work overtime because they have other commitments after their shift
i. Supervisors then requested that the operators set aside their time for the
following day to work beyond their regular shift
h. The following day, 5 operators indicated their desire to work OT;
i. However, after their regular shift, 3 of the 5 workers didn’t work OT which
resulted in the delay in delivery of the client’s order and eventually resulted in
the cancellation of the said order
i. When management asked the workers, who initially manifested their desire to work OT,
to indicate in the time sheet the reason for their failure to do so, 2 of the 3 workers,
namely, Leuland Visca (Visca) and Samuel Tuting (Tuting) gave the same reason
i. “Ayaw nila/ng iba na mag-OT [overtime]ako”
j. Management then conducted an investigation and a hearing where Visca affirmed his
previous claim that petitioners were the ones who pressured him to desist from rendering
overtime work
k. Tuting executed a written statement claiming that herein petitioners induced or threatened
them not to work overtime
l. Management then gave notices to petitioners asking them to explain why no disciplinary
action would be taken against them
i. Petitioners denied liability
m. Management informed petitioners that it has decided to terminate petitioners’
employment on the ground that they instigated an illegal concerted activity resulting in
losses to the company
4. Petitioners’ position paper: dismissed for establishing a union, not for not working overtime
5. Union filed a Notice of Strike
a. Grounds: illegal dismissal
6. SOLE certified dispute to NLRC for compulsory arbitration
7. NLRC: illegal dismissal
a. MR: reversed
8. CA: affirmed NLRC MR

ISSUE: W/N petitioners are guilty of an illegal act and, if so, whether such act is a valid ground for their
termination from employment

1. The evidence presented by Polyson has proven that petitioners are indeed guilty of instigating
two employees to abstain from working overtime
 2. In the Cutting Section Overtime Sheet, employees Visca and Tuting indicated that “ayaw nila/ng
iba na mag-OT [overtime] ako” as the reason why they did not render overtime work despite
having earlier manifested their desire to do so
3. In the administrative hearing, Visca identified petitioners as the persons who pressured them not
to work overtime
4. In the same manner, Tuting, in his written statement, also pointed to petitioners as the ones who
told him not to work overtime
5. Petitioners: statements of Visca and Tuting are self-serving
a. SC: nothing on record to indicate any ulterior motive on the part of Visca and Tuting to
fabricate their claim
6. The Court finds no error in the findings of the NLRC in its questioned Resolution that, contrary
to petitioners’ claims, the slowdown was indeed planned
a. In incident report, upon inquiry by respondent Yu as regards the reason for non-rendering
of overtime, petitioner Ramirez said: “[DI BA] SABI NINYO EIGHT (8) HOURS LANG
KAMI. EH DI EIGHT (8) NA LANG. KUNG MAG[-]OOVERTIME KAMI DAPAT
LAHAT MAY OVERTIME. AYAW KO

G.R. No. 193789 : September 19, 2012 VELASCO, JR., J.:

ALEX Q. NARANJO, DONNALYN DE GUZMAN, RONALD V. CRUZ, ROSEMARIE P. PIMENTEL, and ROWENA B. BARDAJE,Petitioners, v.
BIOMEDICA HEALTH CARE, INC. and CARINA "KAREN" J. MOTOL, Respondents.

FACTS: Petitioners Alex Naranjo (Naranjo), Ronald Allan Cruz, Rowena Bardaje, Donnalyn De Guzman and Rosemarie Pimentel were all
employees of Biomedica Health Care, Inc. (Biomedica).

On November 7, 2006, Naranjo, et al. were all absent for various personal reasons. The next day, Naranjo, et al. came in for work but were not
allowed to enter the premises. Carina Motol (Motol), Biomedicas president, informed them using foul language, to just find other employment.

Subsequently, Biomedica issued notices to Naranjo, et al. accusing them of having conducted an illegal strike and were accordingly directed to
explain within twenty-four (24) hours to explain why they should not be held guilty of and dismissed for violating the company policy against
illegal strikes under Article XI, Category Four, Sections 6, 8, 12, 18 and 25 of the Company Policy.Biomedica, however, failed to furnish them
with the copy of the said company policy.

Naranjo, et al. failed to submit their written explanation. Thus, Biomedica served Notices of Termination stating that Naranjo, et al. engaged in
illegal strike. Consequently, Naranjo et al. filed a complaint for illegal dismissal. The LA dismissed the complaint. The NLRC reversed the LA.
On appeal to the CA, the CA reinstated the decision of the LA.

ISSUE: Whether or not Naranjo, et al. were illegally dismissed?

HELD: The petition is meritorious.

LABOR LAW: illegal dismissal; mass leave; strike

Petitioners were not afforded procedural due process.Thus, the Court elaborated in King of Kings Transport, Inc. v. Mamac that a mere general
description of the charges against an employee by the employer is insufficient to comply with the above provisions of the law. Clearly,
petitioners were charged with conducting an illegal strike, not a mass leave, without specifying the exact acts that the company considers as
constituting an illegal strike or violative of company policies.
Further, while Biomedica cites the provisions of the company policy which petitioners purportedly violated, it failed to quote said provisions in
the notice so petitioners can be adequately informed of the nature of the charges against them and intelligently file their explanation and
defenses to said accusations.

Moreover, the period of 24 hours allotted to petitioners to answer the notice was severely insufficient and in violation of the implementing rules
of the Labor Code. Under the implementing rule of Art. 277, an employee should be given "reasonable opportunity" to file a response to the
notice. King of Kings Transport, Inc. elucidates in this wise: " Reasonable opportunity under the Omnibus Rules means every kind of
assistance that management must accord to the employees to enable them to prepare adequately for their defense. This should be construed
as a period of at least five (5) calendar days from receipt of the notice to give the employees an opportunity to study the accusation against
them, consult a union official or lawyer, gather data and evidence, and decide on the defenses they will raise against the complaint."

In addition, Biomedica did not set the charges against petitioners for hearing or conference in accordance with Sec. 2, Book V, Rule XIII of the
Implementing Rules and Regulations of the Labor Code and in line with ruling in King of Kings Transport, Inc., where the Court explained:
"After serving the first notice, the employers should schedule and conduct a hearing or conference wherein the employees will be given the
opportunity to: (1) explain and clarify their defenses to the charge against them; (2) present evidence in support of their defenses; and (3) rebut
the evidence presented against them by the management."

Petitioners were denied substantive due process. Clearly, to justify the dismissal of an employee on the ground of serious misconduct, the
employer must first establish that the employee is guilty of improper conduct, that the employee violated an existing and valid company rule or
regulation, or that the employee is guilty of a wrongdoing. In the instant case, Biomedica failed to even establish that petitioners indeed violated
company rules, failing to even present a copy of the rules and to prove that petitioners were made aware of such regulations.

Petitioners did not stage a mass leave. The term "Mass Leave" has been left undefined by the Labor Code. Plainly, the legislature intended that
the terms ordinary sense be used. "Mass" is defined as "participated in, attended by, or affecting a large number of individuals; having a large-
scale character." While the term "Leave" is defined as "an authorized absence or vacation from duty or employment usually with pay." Thus,
the phrase "mass leave" may refer to a simultaneous availment of authorized leave benefits by a large number of employees in a company. It is
undeniable that going on leave or absenting ones self from work for personal reasons when they have leave benefits available is an employees
right. Here, the five (5) petitioners were absent on November 7, 2006. The records are bereft of any evidence to establish how many workers
are employed in Biomedica. There is no evidence on record that 5 employees constitute a substantial number of employees of Biomedica.

Petitioners did not go on strike. Art. 212(o) of the Labor Code defines a strike as "any temporary stoppage of work by the concerted action of
employees as a result of any industrial or labor dispute." "Concerted" is defined as "mutually contrived or planned" or "performed in unison." In
the case at bar, the 5 petitioners went on leave for various reasons.Petitioners were in different places on November 7, 2006 to attend to their
personal needs or affairs. They did not go to the company premises to petition Biomedica for their grievance. This shows that there was NO
intent to go on strike.

Dismissal is not the proper penalty. But setting aside from the nonce the facts established above, the most pivotal argument against the
dismissal of petitioners is that the penalty of dismissal from employment cannot be imposed even if we assume that petitioners went on an
illegal strike. It has not been shown that petitioners are officers of the Union. On this issue, the NLRC correctly cited Gold City Integrated Port
Service, Inc. v. NLRC, wherein We ruled that: "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."

The CA is REVERSED and SET ASIDE. The NLRC is REINSTATED with MODIFICATION.
Lapanday vs NLRC

1995 Sept 07

By:  Zendy Garcia-Budhi

Facts:   Lapanday Agricultural and Development Corporation (LADECO) and Cadeco Argo Development Phils Inc. are
sister companies engaged in the production of bananas. Their agricultural establishments are located in Davao City.
They agreed to a Collective Bargaining Agreement (CBA) covering the period from December 5, 1985 to November
30, 1988 with Lapanday Workers’ Union (Union). Said union  is the duly certified bargaining agent of the rank and file
employees and is affiliated with the KMU-ANGLO.

Before the expiration of the CBA, the management policies were initiated by the sister companies  which changed the
relationship of the parties:

 Sister companies contracted with Philippine Eagle Protectors and Security Agency, Inc., to provide security services.
But there was an allegation that guards intimidated and harassed the union members.
 Seminars on Human Development and Industrial Relations (HDIR) for their managerial and supervisory employees and
the rank-and-file were conducted which the Union claimed that the ANGLO (Alliance of Nationalist and Genuine
Labor Organization) was considered belonging to other outlawed labor organizations such as the National
Democratic Front or other leftist groups.
A  labor-management meeting was held on August 2, 1988 where the labor group  represented by its President
Arquilao Bacolod, and its legal counsel raised unfair labor practices such as coercion of employees,  intimidation of
the union members and union busting. They agreed to allow its members to attend the seminar for the rank-and-file
employees.  But,  the Union directed its members not to attend the seminars and picketed the premises of the
Philippine Eagle Protectors to show their displeasure on the hiring of the guards.
The Union filed on August 25, 1988, a Notice of Strike with the National Conciliation and Mediation Board (NCMB)
accusing the company of the same issues raised during the August 2, 1988 labor-management meeting. A
conciliation conference was called for where it was agreed that union officers would attend the HDIR seminar
deleting the discussion on KMU-ANGLO and guidelines governing the guards would be established.
On September 8, 1988, Danilo Martinez, a member of the Board of Directors of the Sister companies charged the
Union with economic sabotage through slowdown to which they filed charges against the Union and its members for
illegal strike, unfair labor practice and damages, with prayer for injunction.

City Mayor Rodrigo Duterte intervened but the dialogues proved fruitless as sister companies refused to withdraw the
cases earlier filed with the Union. Thereafter, a strike vote was conducted among the members of the Union and
those in favor of the strike won overwhelming support from the workers. The result of the strike vote was then
submitted to the NCMB on October 10, 1988. Two days later, or on October 12, 1988, the Union struck.

The gunman was later identified as Eledio Samson, an alleged member of the new security forces of sister
companies. This incident resulted to:

 most of the members of the Union refused to report for work

 they did not comply with the “quota system” adopted by the management to bolster production output
 there were allegations that the Union instructed the workers to reduce their production to thirty per cent (30%).
Tomas Basco and 25 other workers, filed a complaint for unfair labor practice and illegal suspension
against LADECO.
Another complaint for unfair labor practice and illegal dismissal was filed by the Union, together with Arquilao
Bacolod and 58 other complainants. These cases were heard by Labor Arbiter Newton Sancho.

With the case filed by the sister companies, Labor Arbiter Antonio Villanueva ruled that the Union staged an illegal
strike and declared the employees listed as respondents in the complaint to have lost their employment status with
Lapanday Agricultural and Development Corporation and Cadeco Agro Development Philippines, Inc.; and ordered
respondents (petitioners in this case) to desist from further committing an illegal strike.

Petitioners appealed the Villanueva decision to public respondent NLRC.

Before the NLRC could resolve the appeal on the Villanueva decision,  Labor Arbiter Sancho rendered a decision in
the two (2) cases filed by the Union against private
respondents LADECO and CADECO declaring LADECO and CADECO guilty of unfair labor practices and illegal
dismissal and ordered the reinstatement of the dismissed employees of private respondents, with backwages and
other benefits. It considered the refusal of the workers to report for work on September 9, 1988, justified by the
circumstance then prevailing which is the killing of Danilo Martinez on September 8,1988.
NLRC upheld the decision of Labor Arbiter Villanueva. The Union filed its MR but to no avail. Hence, this petition
claiming that NLRC gravely abused its discretion in: a) declaring that their activities, from September 9, 1988 to
October 12, 1988, were strike activities; and b) declaring that the strike staged on October 12, 1988 was illegal.

ISSUE: Whether strike staged on October  12, 1988 illegal

HELD:  Yes, as it was held within the seven (7) day waiting period provided for by paragraph (f), Article 263 of the
Labor Code, as amended. The haste in holding the strike prevented the Department of Labor and Employment from
verifying whether it carried the approval of the majority of the union members.  Hence, there was no grave abuse of
discretion committed.
RATIO: The applicable laws are Articles 263 and 264 of the Labor Code, as amended by E.O. No. 111, dated
December 24, 1986. 

Paragraphs (c) and (f) of Article 263 of the Labor Code, as amended by E.O. 111, provides:

(c) In cases of bargaining deadlocks, the duly certified or recognized bargaining agent may file anotice of strike or the
employer may file, notice of lockout with the Ministry at least 30 days before the intended date thereof. In cases of
unfair labor practice, the 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-daycooling-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 that 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 Ministry may, at its own initiative or upon the request of any affected party, supervise the conduct of
secret balloting. In every case, the union or the employer shall furnish the Ministry the results of the votingat least
seven (7) days before the intended strike or lockout subject to the cooling-off period herein provided.
Article 264 of the same Code reads:

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.
xxx xxx xxx

. . . . 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 ours).
DISPOSITIVE: The petition is dismissed for failure to show grave abuse of discretion on the part of the public
respondent. Costs against the petitioners.
TOYOTA MOTOR PHILIPPINES CORP. WORKERS ASSOCIATION (TPCWA) vs. NATIONAL LABOR
RELATIONS COMMISSION, et al.
G.R. Nos 158798-99 19 October 2007

FACTS:

The Union is the sole and exclusive bargaining agent of all Toyota rank and file employees. After the
holding of a certification election, and the issuance of an Order certifying the Union as the sole and
exclusive bargaining agent of all the Toyota rank and file employees, Toyota challenged said Order via
appeal to the DOLE Secretary. Thus, Toyota refused to negotiate CBAs with the Union pending said
appeal. The Union’s subsequent notice to strike was converted into a preventive mediation case.

The 21 February 2001 hearing on the exclusion of the votes of alleged supervisory employees from the
votes cast during the certification election was cancelled and reset to the next day The Union requested
that its members be absent on 22 February, but the same was denied. Despite said denal, more than
200 employees staged mass actions on 22 and 23 February in front of the BLR and DOLE offices, to
protest the partisan and anti-union stance of Toyota. Due to the loss of the said number of employees,
Toyota experienced losses due to inability to meet production goals. Soon thereafter, Toyota sent
individual letters to some 360 employees requiring them to explain within 24 hours why they should not
be dismissed for their obstinate defiance of the company’s directives. The letters specifically cited the
Company’s Code of Conduct wherein “inciting or participating in riots, disorders, alleged strikes, or
concerted actions detrimental to Toyota’s interest” wherein the first offense would amount to dismissal.

In response to the letters, the Union circulated a Manifesto which urged its members to participate in a
strike/picket and to abandon their posts. The Union members explained that their refusal to work on
their scheduled work time for two consecutive days was simply an exercise of their constitutional right
to peaceably assemble and to petition the government for redress of grievances. On 16 March 2001,
Toyota terminated 227 employees for participation in concerted actions in violation of its Code of
Conduct and for misconduct under Article 282 of the Labor Code. In reaction to the dismissal of its
union members and officers, the Union went on strike on 17 March, 28 March ad 12 April. In the latter
dates, the Union intensified its strike by barricading the gates of Toyota’s Bicutan and Sta. Rosa plants.
The strikers prevented workers who reported for work from entering the plants.

ISSUE(S):

1. Whether the mass actions committed by the Union on different occasions are illegal strikes; and
2. Whether separation pay should be awarded to the Union members who participated in the
illegal strikes.

HELD:

1. Yes. The alleged protest rallies in front of the offices of BLR and DOLE Secretary and at the
Toyota plants constituted illegal strikes. Even if the Union claims that the said acts were not
strikes, there was a lack of permit from the City of Manila to hold “rallies”, nor were there any
filing of a notice in the two-day walk-out. Shrouded by demonstrations, they were in reality
temporary stoppages of work perpetrated through the converted action of the employees who
deliberately failed to report for work on the convenient excuse that they will hold a rally at the
BLR and DOLE offices in Intramuros, Manila. It is obvious that the real and ultimate goal of the
Union is to coerce Toyota to finally acknowledge the Union as the sole bargaining agent of the
company. This is not a legal and valid exercise of the right of assembly and to demand redress
of grievance.

A valid strike should comply with the prerequisites under Article 263 of the Labor Code. These
requisites were not complied with by the Union. Furthermore, the February 2001 strikes are in
blatant violation of Toyota’s Code of Conduct to which the Union and its members are bound to.
To make matters worse, the barricade done during the March and April strikes are in palpable
violation of Article 264(e) of the Labor Code, which proscribes acts of violence, coercion, or
intimidation, or which obstruct the free ingress to and egress from the company premises.

2. No. There can be no good faith in intentionally incurring absences in a collective fashion from
work just to attend DOLE hearings. The Union members should know from common sense that
the company will incur substantial amounts of losses. In a slew of cases, the Court refrained
from awarding separation pay or financial assistance to union officers and members who were
separated from service due to their participation in or commission of illegal acts during strikes.
Samahang Manggagawa-NAFLU v. Sulpicio Lines

Facts:

- The Union filed a notice of strike due to deadlock with the NCMB-NCR after the renegotiation
for a CBA with Sulpicio Lines remained a stalemate
- Sulpicio in response filed with the SOLE a petition praying that the Secretary assume jurisdiction
over the controversy
- SOLE Confesor issued an Order assuming jurisdiction over the labor dispute and enjoined any
strike or lockout by the parties
- The Union filed a second notice of strike alleging that Sulpicio Lines committed acts constituting
ULP amounting to union busting
- The Union immediately conducted a strike vote on the same day
- As a result, 167 rank-and-file employees, officers and members did not report for work and
instead gathered in front of Pier 12, North Harbor
- SOLE Confesor issued another order directing the employees to return to work and certifying
the labor dispute to the NLRC for compulsory arbitration
- Sulpicio Lines filed a complaint for illegal strike/clearance for termination with the NLRC
- NLRC: strike was illegal; Sulpicio has the option to terminate the Union officers
- CA: affirmed NLRC
Issue(1):

w/n strike was illegal

Held:

Yes. The Union did not observe the 7-day waiting out period. Neither were the results of the strike vote
submitted to the DOLE at least 7 days before the strike.
The language of the law leaves no room for doubt that the cooling-off period and the 7-day strike ban
(waiting out period) after the strike-out report were intended to be mandatory.

The Union cannot invoke good faith to justify its holding of a strike. Its allegation of acts constituting ULP
amounting to union busting is bereft of any proof. It is still the Union’s burden to prove using substantial
evidence its allegation of ULP. It is not enough that the union sincerely believe that the employer
committed such acts when the circumstances clearly negate even a prima facie showing to warrant such
a belief.

Issue(2):

w/n there really was a strike

Held:

In a desperate attempt to justify its position, petitioner insists that what transpired on May 20, 1994 was
not a strike but merely a "one-day work absence" or a "simple act of absenteeism".

A strike, as defined in Article 212 (o) of the Labor Code, as amended, means "any temporary stoppage of
work by the concerted action of employees as a result of an industrial or labor dispute." The term
"strike" shall comprise not only concerted work stoppages, but also slowdowns, mass leaves, sitdowns,
attempts to damage, destroy or sabotage plant equipment and facilities, and similar activities.

The basic elements of a strike are present in the case at bar:

First, petitioner’s officers and members numbering 167, in a concerted manner, did not report for work
on May 20, 1994;

Second, they gathered in front of respondent’s office at Pier 12, North Harbor at Manila to participate in
a strike voting conducted by petitioner; and

Third, such union activity was an aftermath of petitioner’s second notice of strike by reason of
respondent’s unfair labor practice/s.

Issue(3):

w/n the Union officers should be terminated

Held:

Yes. Under Art. 264 of LC

"x xx. 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.

Amid the findings in (Issue 1), the participation of the union officers in an illegal strike forfeits their
employment status.
Issue(4):

w/n the NLRC had jurisdiction over the dispute

Held:

Petitioner maintains that the Labor Arbiter, not the NLRC, should have taken cognizance of the case at
bar. The Court did not agree.

International Pharmaceuticals, Inc. v. Secretary of Labor and Employment:

‘x xx [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’ (underscoring
supplied).

"In the same manner, when the Secretary of Labor and Employment certifies the labor dispute to the
NLRC for compulsory arbitration the latter is concomitantly empowered to resolve all questions and
controversies arising therefrom including cases otherwise belonging originally and exclusively to the
Labor Arbiter."
BIFLEX PHILS. INC. LABOR UNION (NAFLU) Et. al vs. FILFLEX INDUSTRIAL AND MANUFACTURING
CORPORATION AND BIFLEX (PHILS.), INC

FACTS:

 Petitioners Villanueva et.al were officers of the Biflex Union, while petitioners Dela Torre et.al were officers
of the Filflex Union. The 2 unions were affiliated with National Federation of Labor Unions (NAFLU), and
were the respective collective bargaining agents of their corporations.
 Biflex and Filfex (Companies) are sister companies engaged in garment business which were situated in
one compound (with one entrance) along with another sister company GGC.
 October 1990, the labor sector stages a welga ng bayan to protest accelerating prices of oil. The union, led
by their officers staged a work stoppage for several days. The companies filed a petition to declare the work
stoppage as illegal for failure to comply with procedural requirements.
 The companies resumed operations. The union claimed that they were illegally locked out by the companies
and were prevented from reporting for work.
o They assert that the companies were "slighted" by the workers' no-show, and as a punishment, the
workers as well as petitioners were barred from entering the company premises.
 The union (claiming that they filed a notice of strike), put up tents, tables and chairs in front of the main gate
of the companies’ premises, and explain that those were for the convenience of the union members who
reported every morning to check if the management would allow them to report for work.
 Company: work stoppage was illegal. work stoppage was illegal since the following requirements for the
staging of a valid strike were not complied with: (1) filing of notice of strike; (2) securing a strike vote, and (3)
submission of a report of the strike vote to DOLE.
 Labor Arbiter: The strike was illegal. Declared that the union officers lost their employment status.
 NLRC: Reversed. There was no strike to speak of as no labor or industrial dispute existed between the
parties.
 CA: Reversed. LA is right. There’s no copy of notice of strike.

ISSUE:

Whether there was indeed an illegal strike.

HELD:

YES.
  Stoppage of work due to welga ng bayan is in the nature of a general strike, an extended sympathy strike. It
affects numerous employers including those who do not have a dispute with their employees regarding their
terms and conditions of employment.
 Employees who have no labor dispute with their employer but who, on a day they are scheduled to work,
refuse to work and instead join a welga ng bayan commit an illegal work stoppage.
 Even if petitioners' joining the welga ng bayan were considered merely as an exercise of their freedom of
expression, freedom of assembly or freedom to petition the government for redress of grievances, the
exercise of such rights is not absolute.For the protection of other significant state interests such as the "right
of enterprises to reasonable returns on investments, and to expansion and growth" enshrined in the 1987
Constitution must also be considered.
o There being no showing that petitioners notified respondents of their intention, or that they were
allowed by respondents, to join the welga ng bayan on October 24, 1990, their work stoppage is
beyond legal protection.
 If there was illegal lockout, why, indeed, did not petitioners file a protest with the management or a complaint
therefor against respondents? As the Labor Arbiter observed, "[t]he inaction of [petitioners] betrays the
weakness of their contention for normally a locked-out union will immediately bring management before the
bar of justice."
 Even assuming arguendo that in staging the strike, petitioners had complied with legal formalities, the strike
would just the same be illegal, for by blocking the free ingress to and egress from the company premises,
they violated Article 264(e) of the Labor Code which provides that "[n]o person engaged in picketing shall ...
obstruct the free ingress to or egress from the employer's premises for lawful purposes, or obstruct public
thoroughfares."
 In fine, the legality of a strike is determined not only by compliance with its legal formalities but also by the
means by which it is carried out.

WHEREFORE, the petition is DENIED.

Abaria vs. National Labor Relations Commission

Note: Abria is one of the 90 complaining Employees in this case I

NTRA-UNION PARTIES: LOCAL CHAPTER - Nagkahiusang Mamumuo sa MCCH (NAMA-MCCH-NFL), NOT

INDEPENDENTLY REGISTERED NATIONAL FEDERATION –

NFL Note: Metro Cebu Community Hospital, Inc. (MCCHI) later changed its name to Visayas Community
Medical Center (VCMC),

EMERGENCY: MCCHI is a hospital owned by UCCP. The NFL is a National Federation which acts as the
exclusive bargaining representative of the rank-and-file employees of the MCCHI. NFL is represented by
Atty. Alforque. NFL has a LOCAL chapter called NAMAMCCH-NFL, which is NOT INDEPENDENTLY
REGISTERED. The local chapter’s President is NAVA. In 1995, since the CBA was about to expire NAVA
wrote the administrator of MCCHI, REV. IYOY, expressing the UNION’s desire to renew the CBA,
attaching to her letter a statement of proposals signed/endorsed by 153 union members. Before
responding to NAVA, MCCHI first checked with Atty. Alforque as NFL representative whether NFL
endorses NAVA’s proposal. MCCHI found out from Atty. Alforque that the proposed CBA submitted by
NAVA was never referred to NFL and that NFL has not authorized any other legal counsel or any person
for collective bargaining negotiations. Atty. Alforque communicated with NAVA and other UNION
officers that they were suspended from the union membership for serious violation of the CBL of NFL.
The letter revealed that NAVA and other UNION officers of the local chapter openly declared during a
General Membership Meeting of the Union that they submit to the authority of another union— KMU
and no longer to NFL. The next day, several union members led by NAVA and her group launched a
series of mass actions such as wearing black and red armbands/headbands, marching around the
hospital premises and putting up placards, posters and streamers. NFL disowned the concerted
activities. On March 13 and 19, 1996, the DOLE Regional Office issued certifications stating that there is
nothing in their records which shows that NAMA-MCCH-NFL is a registered labor organization, and that
said union submitted only a copy of its Charter Certificate on January 31, 1995. Because of this MCCHI
then sent individual notices to all union members asking them to submit within 72 hours a written
explanation why they should not be terminated for having supported the illegal concerted activities of
NAMA-MCCH-NFL which has no legal personality as per DOLE records. The Local Chapter filed a Notice
of Strike with NCMB but this was denied. Despite such denial, NAVA and her group still conducted a
strike. The striking Union members failed to attend the investigations of MCCHI. Hence, MCCHI sent
termination letters to union leaders and other members who participated in the strike and picketing
activities. For their continued picketing activities despite the said warning, more than 100 striking
employees were dismissed. Unfazed, the striking union members held more mass actions. The means of
ingress to and egress from the hospital were blocked, patients and employees were barred from
entering the premises; Placards were placed at the hospital’s entrance gate stating: “Please proceed to
another hospital” and “we are on protest.”; Employees and patients reported acts of intimidation and
harassment perpetrated by union leaders and members. Because of this, MCCHI suffered heavy losses
due to low patient admission rates

(1) WON MCCHI is guilty of unfair labor practice? NO ULP. Records of the NCMB and DOLE Region 7
confirmed that NAMA-MCCH-NFL had not registered as a labor organization, having submitted only its
charter certificate as an affiliate or local chapter of NFL. Not being a legitimate labor organization,
NAMAMCCH-NFL is not entitled to those rights granted to a legitimate labor organization under Art. 242.
Aside from the registration requirement, it is only the labor organization designated or selected by the
majority of the employees in an appropriate collective bargaining unit which is the exclusive
representative of the employees in such unit for the purpose of collective bargaining, as provided in Art.
255. NAMA-MCCH-NFL is not the labor organization certified or designated by the majority of the rank-
and-file hospital employees to represent them in the CBA negotiations but the NFL, as evidenced by
CBAs concluded in 1987, 1991 and 1994. To prove majority support of the employees, NAMA-MCCH-NFL
presented the CBA proposal allegedly signed by 153 union members. However, the petition signed by
said members showed that the signatories endorsed the proposed terms and conditions without stating
that they were likewise voting for or designating the NAMA-MCCH-NFL as their exclusive bargaining
representative. Even assuming that NAMA-MCCH-NFL had validly disaffiliated from its mother union,
NFL, it still did not possess the legal personality to enter into CBA negotiations. A local union which is not
independently registered cannot, upon disaffiliation from the federation, exercise the rights and
privileges granted by law to legitimate labor organizations; thus, it cannot file a petition for certification
election. Besides, the NFL as the mother union has the right to investigate members of its local chapter
under the federation’s Constitution and By-Laws, and if found guilty to expel such members. MCCHI
therefore cannot be faulted for deferring action on the CBA proposal submitted by NAMA-MCCH-NFL in
view of the union leadership’s conflict with the national federation. We have held that the issue of
disaffiliation is an intra-union dispute which must be resolved in a different forum in an action at the
instance of either or both the federation and the local union or a rival labor organization, not the
employer.

(2) WON petitioning employees were illegally dismissed? Union officers – legal, Union members –
illegal. The termination of UNION OFFICERS NAVA, Alsado, Bañez, Bongcaras, Canen, Gerona and
Remocaldo was valid and justified. BUT with respect to the dismissed UNION MEMBERS, although
MCCHI submitted photographs taken at the picket line, it did not individually name those striking
employees and specify the illegal act committed by each of them. Hence, the dismissal of union
members who merely participated in the illegal strike was illegal.
GRAND BOULEVARD HOTEL vs. GENUINE LABOR ORGANIZATION
G.R. No. 153664. July 18, 2003

FACTS:
Petitioner and respondent union entered into and signed a CBA covering the period of July 10, 1988 to
July 9, 1991. 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. On October 16, 1990, the
petitioner's general manager, wrote the Acting Secretary of Labor and Employment (SOLE for brevity)
informing him of the petitioner's decision to retrench 171 employees on a staggered basis, spread over a
period of 60 days, to lessen the daily financial losses being incurred by the petitioner. The next day, the
respondent union informed the DOLE-NCR that the union will conduct a strike vote referendum. The
members of the respondent union voted to stage a strike. DOLE-NCR was thereafter informed of the
results of the strike vote referendum. On October 31, 1990, the SOLE issued a 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 petitioner wrote the SOLE of its decision to implement its retrenchment program to stem its huge
losses. Subsequently, the petitioner terminated the employment of 148 employees. The remaining
employees were also informed that it will close in six months. The respondent union protested the
actions of the petitioner invoking Section 15, Article VI of the CBA. 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, 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. The following day, petitioner terminated the employment of the officers and members
of the respondent union. On November 28, 1990, the SOLE issued an order certifying the labor dispute
to the NLRC. The SOLE issued a return-to-work order, which the respondent officers and members
complied.

Petitioner however filed a complaint with the Regional Arbitration Office of the NLRC for illegal strike
against the respondents on the ground that the latter failed to comply with the requirements provided
under Arts. 263 and 264 of the Labor Code. In their answer, the respondents alleged that the petitioner
committed ULP prior to the filing of the November 16, 1990 notice of strike. Hence, there was no need
for the respondent union to comply with Arts. 263 and 264 of the Labor Code, as the notice filed by the
union on September 27, 1990 was sufficient compliance with the law.

After due trial, the Labor Arbiter rendered a decision in favor of the petitioner and declared the union
officers to have lost and forfeited their employment. When the petitioner learned of said decision, it
forthwith barred the officers and members of the respondent union from entering the hotel. The
respondent union appealed the decision to the NLRC, alleging that it had complied with the
requirements laid down in Arts. 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. After trial, the NLRC affirmed the decision of the LA. It ratiocinated that
the compliance by respondents of the requirements laid down in Arts. 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. Thereafter, the respondents appealed NLRC’s decision to the CA
and the latter ruled that the strike was legal, hence, the dismissal of respondents were unjustified and
without legal basis. Hence, this petition.

ISSUE: Whether the strike staged by the respondent union on November 16 was legal?

HELD: NO. 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; and (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. 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 Art. 264 of the Labor Code, as amended. Consequently, the union officers and members 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. 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 Art. 264(a) of the Labor Code, as amended, which provides that “ x x x 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 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. 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. 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. 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.

No Backwages during the Strike Rule

PHILIPPINE DIAMOND HOTEL AND RESORT, INC. (MANILA DIAMOND HOTEL)
VS. MANILA DIAMOND HOTEL EMPLOYEES UNION
G.R. NO. 158075, June 30, 2006
FACTS: Respondent union filed a Petition for Certification Election seeking certification as the
exclusive bargaining representative of its members. The DOLE-NCR denied the union's petition
as it failed to comply with legal requirements and was seen to fragment the employees of
petitioner. Through its president Kimpo, the union later notified petitioner of its intention to
negotiate a Collective Bargaining Agreement for its members. Acting on the notice, the Hotel
advised the union that since it was not certified by the DOLE as the exclusive bargaining agent,
it could not be recognized as such. By Notice to its members, the union announced that its
executive officers as well as its directors decided to go on strike in view of the management's
refusal to bargain collectively, and thus called for the taking of strike vote. The union went on to
file a Notice of Strike due to unfair labor practice in that the Hotel refused to bargain with it and
the rank-and-file employees were being harassed and prevented from joining it. Conciliation
conferences were immediately conducted. In the early morning of November 29, 1997, however,
the union suddenly went on strike.  The following day, the National Union of Workers in the
Hotel, Restaurant and Allied Industries joined the strike and openly extended its support to the
union. At about this time, Hotel supervisors Agustin and Rowena failed to report for work and
were, along with another supervisor, Mary Grace, seen participating in and supporting the strike.
Petitioner thus filed a petition for injunction before the National Labor Relations Commission to
enjoin further commission of illegal acts by the strikers. Despite the efforts of the NCMB to
conciliate the parties, the same proved futile. The DOLE Acting Secretary by Order directed the
Hotel to just reinstate the strikers to its payroll, and ordering that all cases between the parties
arising out of the labor disputes which were pending before different Labor Arbiters be
consolidated with the case earlier certified to the NLRC for compulsory arbitration.  It appears
that the said order of the Acting Secretary was carried out. The NLRC declared that the strike
was illegal and that the union officers and members who were reinstated to the Hotel's payroll
were deemed to have lost their employment status. On appeal by the union, the Court of Appeals
affirmed the NLRC Resolution
ISSUE: Whether the union members are entitled to their backwages.
RULING: NO. For the general rule is that backwages shall not be awarded in an economic
strike on the principle that "a fair day's wage" accrues only for a "fair day's labor." This Court
must thus hearken to its policy that "when employees voluntarily go on strike, even if in protest
against unfair labor practices," no backwages during the strike is awarded. Jurisprudential law,
however, recognizes several exceptions to the "no backwages rule," to wit: when the employees
were illegally locked to thus compel them to stage a strike; when the employer is guilty of the
grossest form of ULP; when the employer committed discrimination in the rehiring of strikers
refusing to readmit those against whom there were pending criminal cases while admitting
nonstrikers who were also criminally charged in court; or when the workers who staged a
voluntary ULP strike offered to return to work unconditionally but the employer refused to
reinstate them.  Not any of these or analogous instances is, however, present in the instant case.
Solidbank Corporation v. Gamier
November 15, 2010 | J. Villarama Jr.

G.R. No.159460
Petitioner: Solidbank Corporation (now known as First Metro Investment Corp.)
Respondents: Ernesto U. Gamier, Elena R. Condevillamar, Janice L. Arriola & Ophelia C. De Guzman
[RESPONDENTS 1]

G.R. No.159461
Petitioners: Solidbank Corporation and/or its successor-in-interest, First Metro Investment Corporation, Deogracias
N. Vistan & Edgardo Mendoza, Jr.
Respondents: Solidbank Union & Its Dismissed Officers and Members (129 names) [RESPONDENTS 2]

FACTS:
 Solidbank and Solidbank Employees’ Union (Union) were set to renegotiate the economic provisions of their
1997-2001 CBA to cover the remaining 2 years (2000-2001). Negotiations commenced but seeing that an
agreement was unlikely, the Union declared a deadlock and filed a Notice of Strike on December 29, 1999.
 In view of the impending actual strike, then DOLE Sec. Laguesma assumed jurisdiction over the labor dispute
and in an Assumption Order dated January 18, 2000 directed the parties “to cease and desist from committing
any and all acts that might exacerbate the situation”. In another Order dated March 24, 2000, Sec. Laguesma
resolved all economic and non-economic issues submitted by the parties.
 Dissatisfied with the ruling, the Union held a rally in front of the DOLE Office in Intramuros, Manila, simultaneous
with the filing of their MR. On April 3, 2000, an overwhelming majority of employees, Union officers and
members, joined the “mass leave” and “protest action” while the bank’s provincial branches in Cebu, Iloilo,
Bacolod and Naga followed suit and “boycotted regular work.” The union members also picketed the bank’s
Head Office in Binondo on April 6, 2000, and Paseo de Roxas branch on April 7, 2000.
 The employees’ work abandonment/boycott lasted for 3 days (April 3 to 5). On the 3rd day, President of
Solidbank Vistan issued a memorandum declaring that the bank is prepared to take back employees who will
report for work starting April 6, 2000 “provided these employees were/are not part of those who led or instigated
or coerced their co-employees into participating in this illegal act.” Out of the 712 employees, 513 returned to
work and were accepted by the bank. The remaining 199 employees insisted on defying Vistan’s directive (which
includes the 3 respondents in the 1st GR No. and the 129 individual respondents in the 2nd GR No.) They then
filed separate complaints for illegal dismissal, ULP and damages, which were then consolidated.
 Labor Arbiter: Dismissed the complaints of RESPONDENTS 1. But decided in favor of RESPONDENTS 2.
 NLRC: Reversed both.
 CA: Decided that the dismissal of ALL respondents were illegal. REASON: the mass action was a legitimate
exercise of their right to free expression, and not a strike proscribed when the Secretary of Labor assumed
jurisdiction over the impassé between Solidbank and the Union in the collective bargaining negotiations.

MAIN ISSUE: WON the protest rally and concerted work abandonment/boycott is equivalent to a strike. (my own
words) – YES.
RATIO:
 Art. 212 LC defines strike 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 and
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. The term “strike” shall comprise not only concerted work
stoppages, but also slowdowns, mass leaves, sitdowns, attempts to damage, destroy or sabotage plant
equipment and facilities and similar activities. The substance of the situation, and not its appearance, will be
deemed to be controlling.
 In the case at bar, considering that the mass actions stemmed from a bargaining deadlock and an order of
assumption of jurisdiction had already been issued by the Secretary of Labor to avert an impending strike, there
is no doubt that the concerted work abandonment/boycott was the result of a labor dispute.
 Toyota Motor Phils. Corp. Workers Association (TMPCWA) v. National Labor Relations Commission  Union
contends that the protests conducted are not within the ambit of strikes as defined in the LC, since they were
legitimate exercises of their right to peaceably assemble and petition the government for redress of grievances
relying on the doctrine laid down in the case of Philippine Blooming Mills Employees Organization. However, the
Union fails to realize one major difference [in the factual antecedents]: there was no labor dispute in Philippine
Blooming Mills. In the present case, there was an on-going labor dispute arising from Toyota’s refusal to
recognize and negotiate with the Union, which was the subject of the notice of strike filed by the Union. Thus,
the Union’s reliance on Philippine Blooming Mills is misplaced. (applicable in here as well)
 Moreover, Sec. Laguesma in his 1st order already directed that the Union and its members should refrain from
committing “any and all acts that might exacerbate the situation which certainly includes concerted actions. For
all intents and purposes, therefore, the respondents staged a strike ultimately aimed at realizing their economic
demands.
 Note that a strike that is undertaken despite the issuance by the Secretary of Labor of an assumption order
and/or certification is a prohibited activity under Art. 264(a) of the LC and thus illegal.
C. Alcantara & Sons, Inc vs. CA G.R. 155109, September 29, 2010

Facts: The Company and the Union entered into a Collective Bargaining Agreement (CBA) that bound
them to hold no strike and no lockout in the course of its life. At some point the parties began
negotiating the economic provisions of their CBA but this ended in a deadlock, prompting the Union to
file a notice of strike. After efforts at conciliation by the Department of Labor and Employment (DOLE)
failed, the Union conducted a strike vote that resulted in an overwhelming majority of its members
favoring it. The Union reported the strike vote to the DOLE and, after the observance of the mandatory
cooling-off period, went on strike. During the strike, the Company filed a petition for the issuance of a
writ of preliminary injunction with prayer for the issuance of a temporary restraining order (TRO) Ex
Parte with the National Labor Relations Commission (NLRC) to enjoin the strikers from intimidating,
threatening, molesting, and impeding by barricade the entry of non-striking employees at the Companys
premises. On June 29, 1999 the Labor Arbiter rendered a decision, declaring the Unions strike illegal for
violating the CBAs no strike, no lockout, provision. As a consequence, the Labor Arbiter held that the
Union officers should be deemed to have forfeited their employment with the Company and that they
should pay actual damages. With respect to the striking Union members, finding no proof that they
actually committed illegal acts during the strike, the Labor Arbiter ordered their reinstatement without
backwages.

Issues:

1. Whether or the strike conducted is illegal?

2. Whether or not the union members should also be terminated?

Held:

1. Yes, a strike may be regarded as invalid although the labor union has complied with the strict
requirements for staging one as provided in Article 263 of the Labor Code when the same is held
contrary to an existing agreement, such as a no strike clause or conclusive arbitration clause. Here, the
CBA between the parties contained a no strike, no lockout provision that enjoined both the Union and
the Company from resorting to the use of economic weapons available to them under the law and to
instead take recourse to voluntary arbitration in settling their disputes. No law or public policy prohibits
the Union and the Company from mutually waiving the strike and lockout maces available to them to
give way to voluntary arbitration. The Court finds no compelling reason to depart from the findings of
the Labor Arbiter, the NLRC, and the CA regarding the illegality of the strike. Social justice is not one-
sided. It cannot be used as a badge for not complying with a lawful agreement.

2. Yes, given that their illegal acts of threatening, coercing and intimidating non-strikers, obstructing the
free ingress and egress from the company premises and resisted and defied the implementation of the
writ of preliminary injunction issued against the strikers, their employment can no longer reinstated.
However, the records also fail to disclose any past infractions committed by the dismissed Union
members. Taking these circumstances in consideration, the Court regards the award of financial
assistance to these Union members in the form of one-half month salary for every year of service to the
company up to the date of their termination as equitable and reasonable.

International Pharma VS. Secretary of Labor

FACTS: Prior to the expiration of the CBA agreement between petitioner International
Pharmaceuticals, Inc. (Company) and the Associated Labor Union (union), the latter
submitted to the company its economic and political demands. However, these were not
met by the company, hence a deadlock ensued.

the Union filed a notice of strike with the National Conciliation and Mediation Board,
Department of Labor and Employment, After all conciliation efforts had failed, the Union
went on strike and the company’s operation were completely paralyzed.

Subsequently, three other labor cases involving the same parties were filed with the
National Labor Relations Commission (NLRC) to wit:

1. a petition for injunction and damages filed by the company against union for picketing
the company’s establishment

2. a complaint for unfair labor practice.

3. a petition to declare the strike illegal with prayer for damages.

Considering that the company belong to an industry indispensible to national interest, it

being engaged in the manufacture of drugs and pharmaceuticals and employing around
600 workers, the Acting Secretary of Labor assumed jurisdiction over the labor dispute
and issued an order directing the parties to return to the status quo before the work
stoppage invoking Article 263 (g) of the Labor Code.
The union filed a motion, they questioned the power of the Sec. of Labor to assumed
jurisdiction

ISSUE: whether or not the Secretary of the Department of Labor and Employment has
the power to assume jurisdiction over a labor dispute and its incidental controversies,
including unfair labor practice cases, causing or likely to cause a strike or lockout in an
industry indispensable to the national interest.

HELD:

Yes, 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.

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) (1) and (5) of the
same Code, taken conjointly and rationally construed to subserve the objective of the
jurisdiction vested in the Secretary.

In the present case, however, by virtue of Article 263(g) of the Labor Code, the
Secretary has been conferred jurisdiction over cases which would otherwise be under
the original and exclusive jurisdiction of labor arbiters. There was an existing labor
dispute as a result of a deadlock in the negotiation for a collective bargaining agreement
and the consequent strike, over which the Secretary assumed jurisdiction pursuant to
Article 263(g) of the Labor Code. The three NLRC cases were just offshoots of the
stalemate in the negotiations and the strike. We, therefore, uphold the Secretary's order
to consolidate the NLRC cases with the labor dispute pending before him and his
subsequent assumption of jurisdiction over the said NLRC cases for him to be able to
competently and efficiently dispose of the dispute in its totality.
Petitioner's thesis that Section 6, Rule V of the Revised Rules of the NLRC is null and
void has no merit. The aforesaid rule has been promulgated to implement and enforce
Article 263(g) of the Labor Code. The rule is in harmony with the objectives sought to be
achieved by Article 263(g) of the Labor Code, particularly the Secretary's assumption
jurisdiction over a labor dispute and his subsequent disposition of the same in the most
expeditious and conscientious manner. To be able to completely dispose of a labor
dispute, all its incidents would have to be taken into consideration. Clearly, the purpose
of the questioned regulation is to carry into effect the broad provisions of Article 263(g)
of the Labor Code.
By and large, Section 6, Rule V of the Revised Rules of the NLRC is germane to the
objects and purposes of Article 263(g) of the Labor Code, and it is not in contradiction
with but conforms to the standards the latter requires. Thus, we hold that the terms of
the questioned regulation are within the statutory power of the Secretary to promulgate
as a necessary implementing rule or regulation for the enforcement and administration
of the Labor Code, in accordance with Article 5 of the same Code.
Besides, to uphold petitioner Company's arguments that the NLRC cases are alien and
totally separate and distinct from the deadlock in the negotiation of the collective
bargaining agreement is to sanction split jurisdiction which is obnoxious to the orderly
administration of justice.

TELEFUNKEN SEMICONDUCTORS EMPLOYEES UNION-FFW and individual union members

DANILO G. MADARA and ROMEO L. MANAYAO, petitioners, vs., THE COURT OF APPEALS, HON.
BIENVENIDO LAGUESMA, as Secretary of Labor and Employment, and TEMIC TELEFUNKEN
MICROELECTRONICS, (PHILS.), INC., respondents.

DE LEON, JR., J.: [G.R. NOS. 143013-14.  December 18, 2000]

FACTS:

 Company and Union reached a deadlock in their negotiations and Union filed a Notice of Strike
with the NCMB.

 Acting Secretary of the DOLE, Brilliantes, intervened and assumed jurisdicaiton over the
dispute. He issued an Order enjoining any strike or lockout whether actual or intended between
the parties. His Notice of the Assumption Order was personally served on the representatives of
the Company, namely, on Atty. Allan Montañ o, counsel of the Union-FFW, on September 9, 1995
at 1:25 p.m. and twice on Ms. Liza Dimaano, Union President, first on September 8, 1995 at 7:15
p.m. and again on September 11, 1995 at 9:30 a.m. but both union representatives refused to
acknowledge receipt thereof.

 Despite the assumption Order, the Union struck on September 14, 1995.  

 Two (2) days later, the Acting Secretary of Labor issued an Order directing the striking workers
to return to work within twenty-four (24) hours and for the Company to admit them back to
 work under the terms and conditions prevailing prior to the strike.  Notice of the Return-to-
Work Order dated September 16, 1995 of the Acting Secretary of Labor was sent to the striking
Union members but still some of them refused to heed the order and continued with their
picket.  The Federation of Free Workers (FFW) received and acknowledged receipt of the said
Return to Work Order on September 18, 1995.  On September 23, 1995, violence erupted in the
picket lines.  The service bus ferrying non-striking workers was stoned, causing injuries to its
passengers.  Thereafter, complaints for threats, defamation, illegal detention and physical
injuries were filed against the strikers.

 On October 2, 1995, the Company issued letters of termination for cause to the workers who did
not report back to work despite the Notice of Assumption and Return-to-Work Orders issued

 On October 27, 1995, the Acting Secretary of Labor issued another Order directing the Company
to reinstate all striking workers “except the Union Officers, shop stewards, and those with
pending criminal charges, x x x” while the resolution of the legality of the strike was
pending.  This exclusion Order was reaffirmed with some modifications in an Order dated
November 24, 1995.

 In compliance with the SC order to the Secretary of Labor and Employment “to determine with
dispatch the legality of the strike,” marathon hearings were conducted at the DOLE Office with
Atty. Lita V. Aglibut as hearing officer.  On September 22, 1998, both the Union and the
Company complied with the order to submit their respective position papers.  The Company
adduced evidence and submitted its case for decision.  The Union did not adduce
evidence.  Instead, the Union manifested that it would file a motion to dismiss for failure of the
Company to prove its case with the request that it be allowed to present evidence should its
motion be denied.

 Secretary of Labor declared the strike illegal because it was in defiance of the assumption order
and asked the Company to pay backwages.

 CA reversed the ruling on backwages and ruled in favour of the company.

ISSUE:

1) WON strike was illegal – YES

RATIO:

1) Evidence and position paper adduced by Company had sufficient probative value to
overthrow the constitutional presumption of the legality of the strike.

The need to determine the individual liabilities of the striking workers, the union officers and
members alike, was correctly dispensed with by the Secretary of Labor after he gave sufficient
opportunity to the striking workers to cease and desist from continuing with their picket. LC 263
(g)

It is clear from LC 263 (g) that the moment the Secretary of Labor assumes jurisdiction over a labor
dispute in an industry indispensable to national interest, such assumption shall have the effect of
automatically enjoining the intended or impending strike.  It was not even necessary for the
Secretary of Labor to issue another order directing them to return to work.   The mere issuance of
an assumption order by the Secretary of Labor automatically carries with it a return-to-work order,
even if the directive to return to work is not expressly stated in the assumption order. However,
petitioners refused to acknowledge this directive of the Secretary of Labor on September 8, 1995
thereby necessitating the issuance of another order expressly directing the striking workers to
cease and desist from their actual strike, and to immediately return to work but which directive the
herein petitioners opted to ignore.  Article 264(a) of the Labor Code (Prohibited Activities)

The rationale of this prohibition is that once jurisdiction over the labor dispute has been properly
acquired by the competent authority, that jurisdiction should not be interfered with by the
application of the coercive processes of a strike. We have held in a number of cases that defiance to
the assumption and return-to-work orders of the Secretary of Labor after he has assumed
jurisdiction is a valid ground for loss of the employment status of any striking union officer or
member.

PHIMCO INDUSTRIES, INC., petitioner, vs. HONORABLE ACTING SECRETARY OF LABOR

JOSE BRILLANTES and PHIMCO INDUSTRIES LABOR ASSOCIATION, respondents.
PURISIMA, J.: | [G.R. No. 120751.  March 17, 1999]

FACTS:
 March 9, 1995 - the private respondent, Phimco Industries Labor Association (PILA), duly certified
collective bargaining representative of the daily paid workers of the petitioner, Phimco Industries Inc.
(PHIMCO), filed a notice of strike with the NCMB, against PHIMCO, a corporation engaged in the
production of matches, after a deadlock in the collective bargaining and negotiation.  
 April 21, 1995 - after several failed conciliation conferences, PILA, composed of 352 members,
staged a strike.
 June 7, 1995 - PILA presented a petition for the intervention of the Secretary of Labor in the
resolution of the labor dispute, to which petition PHIMCO opposed.  Pending resolution of the said
petition or on June 26, 1995, to be precise, PHIMCO sent notice of termination to some 47 workers
including several union officers.
 July 7, 1995 - the then Acting Secretary of Labor Jose Brillantes assumed jurisdiction over the labor
dispute and issued his Order that striking workers except those terminated to return to work and the
company to receive them. Parties are further ordered to cease and desist from aggravating the
situation.
 July 12, 1995 - petitioner brought the present petition for Certiorari.
 July 31, 1995 – the Secretary of Labor issued another Order temporarily holding in abeyance the
implementation of the questioned Order dated July 7, 1995 for a period of thirty (30) days.
ISSUE:
WON the public respondent acted with grave abuse of discretion amounting to lack or excess of
jurisdiction in assuming jurisdiction over subject labor dispute. - Yes

RATIO:
“(g) When, in his opinion, there exist 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 x x x.” [LC Art 263 (g)]

 Upon the determination by the SoL that such industry is indispensable to the national interest, he
will assume jurisdiction over the labor dispute.“Batas Pambansa Blg. 130 cannot be any clearer, the
coverage being limited to “strikes or lockouts adversely affecting the national interest.” [Limitation set
by legislature on the power of the Secretary]

“While the case at bar appears on its face not to fall within the strict categorization of cases imbued with
“national interest”, this office believes that the obtaining circumstances warrant the exercise of the
powers under Article 263 (g) of the Labor Code, as amended.” [Very admission of the SoL]

The Secretary did not even make any effort to touch on the indispensability of the match factory to
the national interest.  It must have been aware that a match factory, though of value, can scarcely be
considered as an industry  “indispensable to the national interest” as it cannot be in the same category as
“generation and distribution of energy, or those undertaken by banks, hospitals, and export-oriented
industries.” Yet, the public respondent assumed jurisdiction thereover, ratiocinating that prolonged work
disruption would cause loss of employment and consequent social problems [unemployment problem]
Secretary’s assumption of jurisdiction grounded on the alleged “obtaning circumstances” and not
on a determination that the industry involved in the labor dispute is one indispensable to the “national
interest”, the standard set by the legislature, constitutes grave abuse of discretion amounting to lack of or
excess of jurisdiction.  To uphold the action of the public respondent under the premises would be
stretching too far the power of the Secretary of Labor as every case of a strike or lockout where there are
inconveniences in the community, or work disruptions in an industry though not indispensable to the
national interest, would then come within the Secretary’s power.  It would be practically allowing the
Secretary of Labor to intervene in any Labor dispute at his pleasure.  This is precisely why the law sets
and defines the standard: even in the exercise of his power of compulsory arbitration under Article 263
(g) of the Labor Code, the Secretary must follow the law. For “when an overzealous official by-passes the
law on the pretext of retaining a laudable objective, the intendment or purpose of the law will lose its
meaning as the law itself is disregarded”