DLSU v. DLSU Employees Association20200821-10-Q8qh9i
DLSU v. DLSU Employees Association20200821-10-Q8qh9i
DLSU v. DLSU Employees Association20200821-10-Q8qh9i
SYNOPSIS
On the first issue involving the scope of the bargaining unit, the voluntary
arbitrator ruled that the computer operators assigned at the University's
Computer Services Center and the University's discipline officers are not
confidential employees. Hence, they should be included in the bargaining unit
of rank-and-file employees. With respect to employees of the College of St.
Benilde, the voluntary arbitrator found that the College of St. Benilde has a
personality separate and distinct from the Dela Salle University and thus, they
should be excluded from the bargaining unit of the rank-and-file employees of
the University.
On the third issue regarding the Union's proposal for the use of the last-in-
first-out method in case of lay-off, termination due to retrenchment and transfer
of employees, the voluntary arbitrator upheld the right and prerogative of the
management to select and transfer or reassign its employees.
On the fourth issue concerning salary increases for the second and third
years of the CBA, the voluntary arbitrator ruled that on the basis of the
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University's proposed budget, the University can no longer be required to grant
a second round of wage increases for the school years 1991-92 and 1992-93
and charge the same to the incremental proceeds.
On the fifth issue involving the Union's proposal for the reduction of the
workload of the union president, improved leave benefits and indefinite union
leave with pay, the voluntary arbitrator rejected the same.
The Supreme Court agreed with voluntary arbitrator's assailed decision
except that involving salary increases for the second and third years of the
CBA. The Court held that financial capability of a company cannot be based on
its proposed budget because a proposed budget does not reflect the true
financial condition of a company, unlike audited financial statements, and more
importantly, the use of a proposed budget as proof of a company's financial
condition would be susceptible to abuse by scheming employers who might be
merely feigning dire financial condition in their business ventures in order to
avoid granting salary increases and fringe benefits to their employees.
The assailed decision of the voluntary arbitrator is affirmed with the
modification that the issue on salary increases for the second and third years of
the CBA be remanded to the voluntary arbitrator for definite resolution on the
basis of the externally audited financial statements of the University.
SYLLABUS
DECISION
BUENA, J : p
Filed with this Court are two petitions for certiorari, 1 the first petition with
preliminary injunction and/or temporary restraining order, 2 assailing the
decision of voluntary arbitrator Buenaventura Magsalin, dated January 19,
1993, as having been rendered with grave abuse of discretion amounting to
lack or excess of jurisdiction. These two petitions have been consolidated
inasmuch as the factual antecedents, parties involved and issues raised therein
are interrelated. 3
In the said decision, the voluntary arbitrator, on the first issue involving
the scope of the bargaining unit, ruled that "…the Computer Operators
assigned at the CSC [Computer Services Center], just like any other Computer
Operators in other units, [should be] included as members of the bargaining
unit," 13 after finding that "[e]vidently, the Computer Operators are presently
doing clerical and routinary work and had nothing to do with [the] setting of
management policies for the University, as [may be] gleaned from the duties
and responsibilities attached to the position and embodied in the CSC
[Computer Services Center] brochure. They may have, as argued by the
University, access to vital information regarding the University’s operations but
they are not necessarily confidential." 14 Regarding the discipline officers, the
voluntary arbitrator ". . . believes that this type of employees belong (sic) to the
rank-and-file on the basis of the nature of their job." 15 With respect to the
employees of the College of St. Benilde, the voluntary arbitrator found that the
College of St. Benilde has a personality separate and distinct from the
University and thus, held ". . . that the employees therein are outside the
bargaining unit of the University’s rank-and-file employees." 16
On the third issue with respect to the use of the "last-in-first-out" method
in case of retrenchment and transfer to other schools or units, the voluntary
arbitrator upheld the ". . . elementary right and prerogative of the management
of the University to select and/or choose its employees, a right equally
recognized by the Constitution and the law. The employer, in the exercise of
this right, can adopt valid and equitable grounds as basis for lay-off or
separation, like performance, qualifications, competence, etc. Similarly, the
right to transfer or reassign an employee is an employer’s exclusive right and
prerogative." 18
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Regarding the fourth issue concerning salary increases for the second and
third years of the collective bargaining agreement, the voluntary arbitrator
opined that the ". . . proposed budget of the University for SY 1992-93 could
not sufficiently cope up with the demand for increases by the Union. . . With the
present financial condition of the University, it cannot now be required to grant
another round of increases through collective bargaining without exhausting its
coffers for other legitimate needs of the University as an institution," 19 thus, he
ruled that ". . . the University can no longer be required to grant a second
round of increase for the school years under consideration and charge the
same to the incremental proceeds." 20
On the fifth issue as to the Union's demand for a reduction of the
workload of the union president, special leave benefits and indefinite union
leave with pay, the voluntary arbitrator rejected the same, ruling that unionism
". . . is no valid reason for the reduction of the workload of its President," 21 and
that there is ". . . no sufficient justification to grant an indefinite leave." 22
Finding that the Union and the Faculty Association are not similarly situated,
technically and professionally, 23 and that "[w]hile professional growth is highly
encouraged on the part of the rank-and-file employees, this educational
advancement would not serve in the same degree as demanded of the faculty
members," 24 the voluntary arbitrator denied the Union's demand for special
leave benefits. LexLib
"3. The significant role which the University assumes in the admission
of students at the CSB is revealed in the following provisions of
the CSB’s Bulletin for Arts and Business Studies Department for
the schoolyear 1992-1993, thus:
'Considered in the process of admission for a (sic) high
school graduate applicants are the following criteria: results of
DLSU College Entrance Examination . . .
"4. The academic programs offered at the CSB are likewise presented
in the University’s Undergraduate Prospectus for schoolyear
1992-1993 (Annex "D" of the Union’s Consolidated Reply and
Rejoinder).
"5. The Leave Form Request (Annex "F" of the Union’s Position Paper)
at the CSB requires prior permission from the University anent
leaves of CSB employees, to wit:
II.
"WHETHER OR NOT GRAVE ABUSE OF DISCRETION WAS COMMITTED
BY THE VOLUNTARY ARBITRATOR WHEN HE UPHELD THE UNION’S
DEMAND FOR THE INCLUSION OF A UNION SHOP CLAUSE IN THE
PARTIES’ COLLECTIVE BARGAINING AGREEMENT.
III.
"WHETHER OR NOT GRAVE ABUSE OF DISCRETION WAS COMMITTED
BY THE VOLUNTARY ARBITRATOR WHEN HE DENIED THE UNION’S
PROPOSAL FOR THE "LAST-IN-FIRST-OUT" METHOD OF LAY-OFF IN
CASES OF RETRENCHMENT. cdphil
IV.
"WHETHER OR NOT GRAVE ABUSE OF DISCRETION WAS COMMITTED
BY THE VOLUNTARY ARBITRATOR WHEN HE RULED THAT THE
UNIVERSITY CAN NO LONGER BE REQUIRED TO GRANT A SECOND
ROUND OF WAGE INCREASES FOR THE SCHOOL YEARS 1991-92 AND
1992-93 AND CHARGE THE SAME TO THE INCREMENTAL PROCEEDS.
V.
"WHETHER OR NOT GRAVE ABUSE OF DISCRETION WAS COMMITTED
BY THE VOLUNTARY ARBITRATOR WHEN HE DENIED THE UNION’S
PROPOSALS ON THE DELOADING OF THE UNION PRESIDENT, IMPROVED
LEAVE BENEFITS AND INDEFINITE UNION LEAVE WITH PAY."
The Union, on the other hand, raised the following issues, in its
memorandum, 39 filed pursuant to Supreme Court Resolution dated February 9,
1 9 9 4 , 40 to wit; that the voluntary arbitrator committed grave abuse of
discretion in:
"(1) FAILING AND/OR REFUSING TO PIERCE THE VEIL OF CORPORATE
FICTION OF THE COLLEGE OF ST. BENILDE-DLSU DESPITE THE
PRESENCE OF SUFFICIENT BASIS TO DO SO AND IN FINDING THAT
THE EMPLOYEES THEREAT ARE OUTSIDE OF THE BARGAINING
UNIT OF THE DLSU'S RANK-AND-FILE EMPLOYEES. HE ALSO
ERRED IN HIS INTERPRETATION OF THE APPLICATION OF THE
DOCTRINE;
"(2) DENYING THE PETITIONER’S PROPOSAL FOR THE 'LAST-IN FIRST-
OUT’ METHOD OF LAY-OFF IN CASE OF RETRENCHMENT AND IN
UPHOLDING THE ALLEGED MANAGEMENT PREROGATIVE TO
SELECT AND CHOOSE ITS EMPLOYEES DISREGARDING THE BASIC
TENETS OF SOCIAL JUSTICE AND EQUITY UPON WHICH THIS
PROPOSAL WAS FOUNDED;
"(3) FINDING THAT THE MULTISECTORAL COMMITTEE IN THE
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RESPONDENT UNIVERSITY IS THE LEGITIMATE GROUP WHICH
DETERMINES AND SCRUTINIZES ANNUAL SALARY INCREASES
AND FRINGE BENEFITS OF THE EMPLOYEES;
"(4) HOLDING THAT THE 70% SHARE IN THE INCREMENTAL TUITION
PROCEEDS IS THE ONLY SOURCE OF SALARY INCREASES AND
FRINGE BENEFITS OF THE EMPLOYEES;
"(5) FAILING/REFUSING/DISREGARDING TO CONSIDER THE
RESPONDENT UNIVERSITY’S FINANCIAL STATEMENTS FACTUALLY
TO DETERMINE THE FORMER’S CAPABILITY TO GRANT THE
PROPOSED SALARY INCREASES OVER AND ABOVE THE 70%
SHARE IN THE INCREMENTAL TUITION PROCEEDS AND IN GIVING
WEIGHT AND CONSIDERATION TO THE RESPONDENT
UNIVERSITY’S PROPOSED BUDGET WHICH IS MERELY AN
ESTIMATE.
"(6) FAILING TO EQUATE THE POSITION AND RESPONSIBILITIES OF THE
UNION PRESIDENT WITH THOSE OF THE PRESIDENT OF THE
FACULTY ASSOCIATION WHICH IS NOT EVEN A LEGITIMATE
LABOR ORGANIZATION AND IN SPECULATING THAT THE
PRESIDENT OF THE FACULTY ASSOCIATION SUFFERS A
CORRESPONDING REDUCTION IN SALARY ON THE ACCOUNT OF
THE REDUCTION OF HIS WORKLOAD; IN FAILING TO APPRECIATE
THE EQUAL RIGHTS OF THE MEMBERS OF THE UNION AND OF
THE FACULTY FOR PROFESSIONAL ADVANCEMENT AS WELL AS
THE DESIRABLE EFFECTS OF THE INSTITUTIONALIZATION OF THE
SPECIAL LEAVE AND WORKLOAD REDUCTION BENEFITS." 41
With the foregoing rules in mind, we shall now proceed to discuss the
merit of these consolidated petitions.
As to the discipline officers, the University maintains that ". . . they are
likewise excluded from the bargaining unit of the rank-and-file employees
under the parties' 1986 CBA. The Discipline Officers are clearly alter egos of
management as they perform tasks which are inherent in management [e. g.
enforce discipline, act as peace officers, secure peace and safety of the
students inside the campus, conduct investigations on violations of University
regulations, or of existing criminal laws, committed within the University or by
University employees] . . ." 49 The University also alleges that "the Discipline
Officers are privy to highly confidential information ordinarily accessible only to
management." 50
With regard to the employees of the College of St. Benilde, the Union,
supported by the Solicitor General at this point, asserts that the veil of
corporate fiction should be pierced, thus, according to the Union, the University
and the College of St. Benilde should be considered as only one entity because
the latter is but a mere integral part of the University. 51
The University's arguments on the first issue fail to impress us. The Court
agrees with the Solicitor General that the express exclusion of the computer
operators and discipline officers from the bargaining unit of rank-and-file
employees in the 1986 collective bargaining agreement does not bar any re-
negotiation for the future inclusion of the said employees in the bargaining unit.
During the freedom period, the parties may not only renew the existing
collective bargaining agreement but may also propose and discuss
modifications or amendments thereto. With regard to the alleged confidential
nature of the said employees’ functions, after a careful consideration of the
pleadings filed before this Court, we rule that the said computer operators and
discipline officers are not confidential employees. As carefully examined by the
Solicitor General, the service record of a computer operator reveals that his
duties are basically clerical and non-confidential in nature. 52 As to the
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discipline officers, we agree with the voluntary arbitrator that based on the
nature of their duties, they are not confidential employees and should therefore
be included in the bargaining unit of rank-and-file employees.
The Court also affirms the findings of the voluntary arbitrator that the
employees of the College of St. Benilde should be excluded from the bargaining
unit of the rank-and-file employees of Dela Salle University, because the two
educational institutions have their own separate juridical personality and no
sufficient evidence was shown to justify the piercing of the veil of corporate
fiction. 53
The Union, on the other hand, counters that the Labor Code, as amended,
recognizes the validity of a union shop agreement in Article 248 thereof which
reads:
"ARTICLE 248. Unfair labor practices of employers. —
On the fifth issue involving the Union’s proposals on the deloading of the
union president, improved leave benefits and indefinite union leave with pay,
we agree with the voluntary arbitrator’s rejection of the said demands, there
being no justifiable reason for the granting of the same.
On the sixth issue regarding the finding that the multi-sectoral committee
in the University is the legitimate group which determines and scrutinizes the
annual salary increases and fringe benefits of the employees of the University,
the Court finds that the voluntary arbitrator did not gravely abuse his discretion
on this matter. From our reading of the assailed decision, it appears that during
the parties’ negotiations for a new collective bargaining agreement, the Union
demanded for a 25% and 40% salary increase for the second and third years,
respectively, of the collective bargaining agreement. 65 The University’s
counter-proposal was for a 10% increase for the third year. 66 After the meeting
of the multi-sectoral committee on budget, which is composed of students,
parents, faculty, administration and union, the University granted across-the-
board salary increases of 11.3% and 19% for the second and third years,
respectively. 67 While the voluntary arbitrator found that the said committee ". .
. decided to grant the said increases based on the University’s viability which
were exclusively sourced from the tuition fees. . .," no finding was made as to
the basis of the committee’s decision. Be that as it may, assuming for the sake
of argument that the said committee is the group responsible for determining
wage increases and fringe benefits, as ruled by the voluntary arbitrator, the
committee’s determination must still be based on duly audited financial
statements following our ruling on the fourth issue.
On the seventh and last issue involving the ruling that the 70% share in
the incremental tuition proceeds is the only source of salary increases and
fringe benefits of the employees, the Court deems that any determination of
this alleged error is unnecessary and irrelevant, in view of our rulings on the
fourth and preceding issues and there being no evidence presented before the
voluntary arbitrator that the University held incremental tuition fee proceeds
from which any wage increase or fringe benefit may be satisfied.
SO ORDERED.
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Bellosillo, Mendoza, Quisumbing and De Leon, Jr., JJ., concur.
Footnotes
1. Docketed as G.R. Nos. 109002 and 110072.
3. As per Resolution dated August 11, 1993 in Rollo (G.R. No. 109002), p. 131; and
Resolution dated August 18, 1993 in Rollo (G.R. No. 110072), p. 99.
4. Rollo (G.R. No. 109002), p. 3.
5. Ibid., p. 23.
6. Ibid.
7. Ibid.
8. Ibid.
9. Ibid., p. 25.
10. Ibid.
11. Ibid.
12. Ibid.
13. Ibid.
14. Ibid., p. 24.
15. Ibid.
16. Ibid.
18. Ibid.
19. Ibid., p. 26.
20. Ibid.
21. Ibid.
22. Ibid.
23. Ibid.
24. Ibid., p. 27.
25. Ibid.
26. Ibid.
27. Ibid., p. 28.
31. Resolution dated August 11, 1993 in Rollo (G.R. No. 109002), p. 131; and
Resolution dated August 18, 1993 in Rollo (G.R. No. 110072), p. 99.
32. Rollo (G.R. No. 110072), p. 107.
40. The Resolution dated February 9, 1994 was issued by the Second Division of
this Court.
41. Rollo (G.R. No. 109002), pp. 233-234.
55. Ibid.
63. Ibid.
64. Saballa vs. National Labor Relations Commission, 260 SCRA 697, 709, (1996).
67. Ibid.