2013 Bar Review Materials

MAGNIFICUS JURIS REVIEWS AND SEMINARS, INC.

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2013 Bar Review in Labor RelationsJuly 5, 6 & 7, 2013

Atty. Jefferson M. MarquezPartner, ACCRA Law Offices

Professor, USC School of Law & Governance

Part 1: July 5, 2013 (Friday)5:30 pm-8:30 p.m.

I. Applicable Law and Basic PrinciplesII. Employer-Employee Relationship

A. Power to Hire1) Restrictions prior to hiring

B. Payment of Wages1) Methods of Fixing Wages

III. Employment Status & Classification of Employees

Part 2: July 6, 2013 (Saturday)8:00-12:00/1:30-6:30 p.m.

I. Management PrerogativeII. Security of Tenure

A. Termination of Employment1) Just Cause/s

a) Prior Notice and Hearingb) Imposable Penaltyc) Relief/s and Awardd) Separation Pay in lieu of Reinstatemente) Other Award/s Based on Equity

2) Authorized Cause/s a) Bona Fide Suspension of Operations

a.1) Cost Cutting Measures b) Fair and Reasonable Criteria

c) 30 Day Prior Notice d) Relief/s and Awards e) Disease

3) Liability of Corporate Officer/sIII. Resignation and RetirementIV. Jurisdiction

V. Labor Law Practice and Procedure

Part 3: July 7, 2013 (Sunday)8:00-12:00/1:30-6:30p.m.

I. Right to Self-OrganizationA) Constitutional & Statutory BasisB) Union MembershipC) Ineligible EmployeesD) Registration of a Labor Organization

1) Modes of Acquiring Legal Personality E) Cancellation of Union Registration F) Union member’s obligations

II. Major Rights of Legitimate Labor UnionIII. Voluntary Arbitration

A) Basic PrinciplesB) Jurisdiction of Voluntary Arbitrator

IV. Unfair Labor Practice

1. EMPLOYER-EMPLOYEE RELATIONSHIP

a. People’s Broadcasting (Bombo Radyo Phils., Inc.) vs. Sec. of DOLE et al., G.R. No. 179652, March 6, 2012, En banc Res. J.Velasco – It is clear and beyond debate than an employer-employee relationship must exist for the exercise of the visitorial and enforcement power of the DOLE. The question now arises, may the DOLE make a determination of whether an employer-employee relationship exists, and if so, to what extent? This must be answered in the affirmative. The prior decision of this Court in the present case accepts such answer, but places a limitation upon the power of the DOLE, holding that the determination of the existence of such relationship is still primarily within the power of the NLRC, that is any finding by the DOLE is merely preliminary. This conclusion must be revisited. The law did not say that the DOLE would first seek the NLRC’s determination of the existence of employer-employee relationship, or that should the existence of the employer-employee relationship be disputed, the DOLE would refer the matter to the NLRC. The DOLE must have the power to determine whether or not an employer-employee relationship exists, and from there to decide whether or not to issue a compliance order in accordance with Art. 128 (b) of the Labor Code. The DOLE Secretary or his representative, can utilize the four-fold test in

ATTY. J. M. MARQUEZPage 2 of 37

determining the existence of employer-employee relationship, even in the course of inspection, making use of the same evidence that would have been presented before the NLRC. The DOLE would have no jurisdiction only if the employer-employee relationship has already been terminated, or it appears, upon review, that no employer-employee relationship existed in the first place. The DOLE may well make the determination that no employer-employee relationship exists, thus divesting itself of jurisdiction over the case. In sum, the Labor Secretary or the latter’s authorized representative under Art. 128 of the Code shall have the power to determine the existence of employer-employee relationship, to the exclusion of the NLRC. The prospect of competing conclusions could just as well have been eliminated by according respect to the DOLE findings, to the exclusion of the NLRC, and this, we believe is the more prudent course of action to take. See also Superior Packaging Corp., vs. Balagsay et al., G.R. No. 178909, October 10, 2013 – where the power of the Regional Director/DOLE to make a determination of the existence of employer-employee relationship and find the existence of labor-only contracting under his visitorial and enforcement power, was affirmed, citing People’s Broadcasting (Bombo Radyo Phils., Inc.

b. Tongko vs. Manufacturer Life Insurance Co. (Phils), Inc., et al., G.R. No. 167622, January 25, 2011, En Banc, J.Brion – the complainant was an independent self-employed insurance agent, and not an employee of Manulife despite that he had been a unit manager, branch manager and regional sales manager. He had always been governed by the agreement from the start until the end of his relationship with Manulife. His agency status never changed except to the extent of being a lead agent. A principal-agent relationship existed and not an employer-employee relationship, since there is absence of labor law control. Control over the performance of the task of one providing the service – both with respect to the means and manner, and the results of the service --- is the primary element in determining whether an employment relationship exists. There are built-in elements of control specific to an insurance agency, which do not amount to the elements of control that characterize an employment relationship governed by the Labor Code. The Insurance Code provides definite parameters in the way an agent negotiates for the sale of the company’s insurance products, his collection activities and his delivery of the insurance contract or policy.

c. Legend Hotel (Manila) vs. Realuyo , G.R. No. 153511, July 18, 2012 – Respondent who was employed as a pianist in the establishment’s coffee shop from September 1992 until the termination of his services in July 1999 was an employee as he was under the supervision and control of the


establishment, thus: he could not choose the time of his performance which was fixed from 7:00 p.m. to 10:00 p.m. 3 to 6 times a week; he could not choose the place of his performance; he was required at certain times to perform only tagalong songs or music, or to wear barong tagalong to conform to the Filipiniana motif; he was subjected to the rules on employee’s representation check and chits, a privilege granted to other employees. Moreover, the establishment wielded the power of selection at the time it entered into the service contract with the pianist. The establishment could not seek refuge behind such service contract as it is the law that defines and governs an employment relationship, whose terms are not restricted to those fixed in the written contract, for other factors, like the nature of the work the employee has been called upon to perform, are also considered. There is likewise no denying that the remuneration denominated as talent fees was fixed on the basis of his talent and skill and the quality of the music he played during the hours of performance each night, taking into account the prevailing rate for similar talents in the entertainment industry. His remuneration albeit denominated as talent fees was still considered as included in the term wage in the sense and context of the Labor Code, regardless of how the establishment chose to designate the remuneration. That he worked for less than 8 hours/day does not negate employer-employee relationship, since the Labor Code only sets a maximum number of hours but did not prohibit work of less than 8 hours.

2. TERMINATION OF EMPLOYMENT

a. Asian Terminal vs. NLRC, G.R. No. 158458, December 19, 2007, citing 2005 Standard Electric Mfg. case -- termination of employee who failed to report because under detention for criminal charges which were later dismissed, a case of dismissal for a non-existent or false cause, citing cases of Magtoto & Pedrosa . ; see also Standard Electric Mfg. Co. vs. Standard Electric EE Union, G.R.No. 166111, August 25, 2005 - termination of employee who failed to report because under detention for rape charges which were later dismissed; case of non-existent or false cause, citing Magtoto & Pedrosa.

b. Perez, et al. vs. Phil Telegraph & Telephone Company, et al., G.R. No. 152048, April 7, 2009 – En Banc – Due process, formal conference under IRR mandatory only when requested by employee in writing, or substantial evidentiary disputes exist or a company rule or practice requires it or when similar circumstances require it; ample opportunity to be heard under the Labor Code prevails over the hearing requirement of the IRR.


c. Quimbao vs. Manila Electric Company , G.R. No. 171023, December 18, 2009 – Gross neglect of duty consisting of habitual absences and tardiness becomes serious in character due to frequency of instances. It can be equated to serious misconduct. Even assuming that the ground for dismissal is gross and habitual neglect of duty, the employee is not entitled to separation pay. The constitutional policy to provide full protection to labor is not meant to be an instrument to oppress the employers.

d. Javellana, Jr. vs. Belen , G.R. Nos. 181913 & 182158, March 5, 2010, - when an employee is found to be illegally dismissed, and reinstatement is not possible, he should be awarded as follows: (a) backwages from date of dismissal until finality of decision; (b) separation pay from date of employment until finality of decision (not date of dismissal); (c) 10% attorney’s fees based on the awards computed; and (d) 12% interest per annum on the awards computed from date of finality of decision until they are paid, these monetary claims being equivalent of a forbearance of credit. Note, however, Torres vs. Rural Bank of San Juan, G.R. No. 184520, March 13, 2013 involving a managerial employee who was illegally dismissed for loss of confidence. Aside from the award of separation pay in lieu of reinstatement which was fixed at one (1) month salary for every year of service, he was awarded backwages with legal interest at the rate of 6% per annum from date of his illegal dismissal until finality of the decision of the Court, and thereafter, with 12% legal interest until fully paid in accordance with the guidelines in the 1994 Eastern Shipping Lines, Inc., case.

e. Aro et al., vs. NLRC-4 th Division, et al., G.R. No. 174792, March 7, 2012—for project employees who were illegally dismissed before the expiration of the project, they shall be entitled to reinstatement with full backwages. However if the project or work is completed during the pendency of the ensuing suit for illegal dismissal, the employees shall be entitled to full backwages from the date of termination until the actual completion of the work, and not until the finality of the decision. Illegally dismissed workers are entitled to the payment of their salaries corresponding to the unexpired portion of their employment where the employment is for a definite period. In this case, the Cordova Reef Village Resort project had been completed in October 1996 and the employer had signified its willingness, by way of concession to the workers, to set the date of the completion of the project as of March 18, 1997; hence, the latter date should be considered as the date of the completion of the project for purposes of computing the full backwages of the workers.

f. General Milling Corp vs. Casio, et al. , G.R. No. 149552, March 10, 2010 – In terminating an employment by enforcing


the union security clause in the CBA, the employers needs only to determine and prove that: (a) the union security clause is applicable; (b) the union is requesting for the enforcement of the union security provision in the CBA; and (c) there is sufficient evidence to support the decision of the Union to expel the employees from the union. The employer cannot dispense with the prior and notice requirements even when said dismissal is pursuant to a closed shop provision in the CBA.

g. College of the Immaculate Concepcion vs. NLRC, et al., G.R. No. 167563, March 22, 2010 – an employee who is reinstated in the payroll pending appeal is not required to refund to the employer his salaries and allowances even if such order of reinstatement is reversed by the NLRC, citing Garcia En Banc. And this rule applies even if the Labor Arbiter’s order of reinstatement is incorrect as when the reinstatement is to a position different from what was previously held. Article 223 of the Labor Code is not concerned with the wisdom or propriety of the labor arbiter’s order of reinstatement, for if it was, then it should have provided that the pendency of an appeal should stay its execution. After all, a decision cannot be deemed irrefragable unless it attains finality; see Garcia vs. PAL, G.R. No. 164856, Jan. 20, 2009, En Banc– Employer has no right to demand refund of salary paid pending appeal even if the NLRC reverses the labor arbiter’s order of reinstatement; the social justice principles of labor law outweigh or render inapplicable the civil law doctrine of unjust enrichment espoused by J. Velasco in 2007 Genuino case; placing an employer under corporate rehabilitation has the effect of suspending labor claims, and constitutes an injunction on power of employer to exercise option of reinstatement.

h. WPP Marketing Communications Inc., et al. vs. Galera , G.R. No. 169207, March 25, 2010 – an alien who is working in the Philippines but without an alien employment permit cannot claim employment benefits under the Labor Code even if she is found to be illegally dismissed. Employment permit must be acquired prior to employment. She cannot come to this Court with unclean hands. To grant her prayer is to sanction the violation of the Philippine labor laws requiring aliens to secure work permits before their employment. We hold that the status quo must prevail in the present case and we leave the parties where they are. This ruling, however does not bar her from seeking relief from other jurisdictions.

i. Cercado vs. Uniprom, Inc. , G.R. No. 188154, October 13, 2010 – It is axiomatic that a retirement plan giving the employer the option to retire its employees below the ages provided by law must be assented to an accepted by the latter, otherwise, its adhesive imposition will amount to a deprivation of property without due process of law. Xxx The


plan can either be embodied in a CBA, or established after consultations and negotiations with the employees’ bargaining representative. Here, the employer retired the petitioner under the company’s non-contributory retirement plan which was unilaterally and compulsorily imposed on him. At the time she was hired, the company had no existing retirement plan. The petitioner was forced to participate in the plan, and the only way she could have rejected the same was to resign or lose her job. It is not enough that petitioner was aware of the retirement plan. Implied knowledge, regardless of duration, cannot equate to the voluntary acceptance required by law in granting an early retirement age option to an employer. The law demands more than a passive acquiescence on the part of employees, considering that an employer’s early retirement age option involves a concession of the former’s constitutional right to security of tenure. Retirement is the result of a bilateral act of the parties, a voluntary agreement between the employer and the employee whereby the latter, after reaching a certain age, agrees to sever his or her employment with the former.

j. Robinsons Galleria/Robinsons Supermarket Corp., vs. Ranchez, G.R. No. 177937, January 19, 2011 – when the cashier under probation was suspected of qualified theft, was strip-searched by the company guards, and brought to the police where she was detained, she was deemed constructively dismissed. She was not accorded substantive and procedural due process. The haphazard manner in the investigation of the missing cash, which was left to the determination of the police authorities etc., left the employee with no choice but to cry foul. On the same day that the missing money was reported by the employee, the company already prejudged her guilt. However since she was notified of her termination and/or expiration of probationary employment, she cannot be reinstated anymore but entitled to separation pay instead. Her backwages should be until the end of the probationary contract because as probationary employee, the lapse of her employment without her appointment as a regular employee effectively severed the employer-employee relationship between the parties.

k. Caong, Jr. vs. Regualos, G.R. No. 179428, January 26, 2011 – the policy of jeepney owners/operators of suspending their drivers pending payment of arrears in their boundary obligations is fair and reasonable and does not constitute illegal dismissal. There was no intent to sever the employer-employee relationship. In fact it was made clear that the drivers could put an end to the suspension if they only pay their recent arrears. It would have been different if the drivers complied with the condition and their employer still refused to readmit them to work. That would have been a clear act of dismissal. But such was not the case. Instead of paying, the drivers even filed a complaint for illegal dismissal.


l. Nationwide Security & Allied Services vs. Valderama , G.R. No. 186614, Feb. 23, 2011 – a security agency may place a security guard on floating status or temporary off detail until he is transferred or assigned to a new post or client. Such relief and transfer order in itself does not sever employment relationship. While the guard has the right to security of tenure having been employed for more than 3 years, it does not give him a vested right to his position as would deprive his employer the prerogative to change his assignment or transfer him where his service will be most beneficial to the client. However, such temporary inactivity or floating status should continue only for six months. Otherwise, it constitutes constructive dismissal. If there is a surplus of security guards caused by lack of clients or projects, the security agency may resort to retrenchment upon compliance with the Labor Code. In this way, the agency will not to be held liable for constructive dismissal and be burdened with payment of backwages.

m.Exodus International Construction Corp., vs. Biscocho, et al., G.R. No. 166109, Feb, 23, 2011 – when the employer denies dismissing the complainants as in fact the latter chose not to report for work and sued for illegal dismissal, it is incumbent upon the complainants-employees to first establish the fact of dismissal before the burden is shifted to the employer to prove that the dismissal was legal. If there is no dismissal, then there can be no question as to the legality or illegality thereof. In such case, the Labor Arbiter is correct in ordering reinstatement but without backwages.

n. Pfizer Inc., et al., vs. Velasco, G.R. No. 177467, March 9, 2011 – the delay of the employer for almost 2 years to comply with the order of reinstatement does not excuse it from paying the salary of the reinstated employee for the period until the dismissal was found to be valid by the appellate court, citing Garcia En Banc which abandoned Genuino. Moreover, his reinstatement pending appeal must be for the position he had occupied prior to his dismissal and in Baguio City, and not at the main office in Makati City as this would unnecessarily cause hardship to the reinstated employee more especially since no explanation was offered by the employer for such relocation such as the filling up of the employee’s position and the unavailability of substantially equivalent position in Baguio City. A transfer of work assignment without any justification therefor even if the employee would be presumably doing the same job with the same pay cannot be deemed compliance with the reinstatement order.

o. Mansion Printing Center et al., vs. Bitara, Jr. G.R. No. 168120, January 25, 2012 – There is no merit in complainant’s claim that the notice of explanation and notice of termination,


both of which he allegedly refused to sign, were never served upon him, and hence, he was denied due process. Here, firstly, the employer indicated in the notices the notation that respondent “refused to sign” together with the corresponding dates of service. Second, the employer executed an Affidavit dated 29 July 2000 stating that: (1) he is the General Manager of the company; (2) he personally served each notice upon respondent, when respondent went to the office/factory on 17 March 2000 and 21 March 2000, respectively; and (3) on both occasions, after reading the contents of the memoranda, respondent refused to acknowledge receipt thereof. We are, thus convinced that the notices have been validly served. xxx

p. Bank of Lubao, Inc. vs. Manabat et al. , G.R. No. 188722, February 1, 2012 – Under the “doctrine of strained relations”, the payment of separation pay is considered an acceptable alternative to reinstatement when the latter option is no longer desirable or viable. On one hand, such payment liberates the employee from what could be a highly oppressive work environment. On the other hand it releases the employer from the grossly unpalatable obligation of maintaining in its employ a worker it could no longer trust. In such cases, it should be proved that the employee concerned occupies a position where he enjoys the trust and confidence of his employer; and that it is likely that if reinstated, an atmosphere of antipathy and antagonism may be generated as to adversely affect the efficiency and productivity of the employee concerned. Here, the petitioner’s filing of various criminal complaints against the employee who was a Bank Encoder for qualified theft and the subsequent filing by the latter of the complaint for illegal dismissal against the latter, taken together with the pendency of the instant case for more than six years had caused strained relations between the parties. Even the respondent refused to be re-admitted to work which by itself is indicative of the existence of strained relations between the parties. However the award of backwages should be modified. When there is an order of reinstatement, the computation of backwages shall be reckoned from the time of illegal dismissal up to the time that the employee is actually reinstated to his former position. When the labor arbiter directed respondent’s reinstatement, the petitioner directed the respondent to report back to work on May 4, 2007. However, the respondent opted not to report for work. Thus, it is but fair that the backwages that should be awarded be computed from the time respondent was illegally dismissed until the time when he was required to report for work i.e. from September 1, 2005 until May 4, 2007. It is only during the said period that respondent is deemed to be entitled to the payment of backwages. The fact that the CA, in its April 4, 2009 decision, ordered the payment of separation pay in lieu of reinstatement would not entitle the respondent to backwages as the CA decision unlike that of the LA is not immediately executory.


q. Canadian Opportunities Unlimited, Inc. vs. Dalangin, Jr. G.R. No. 172223, February 6, 2012 – The dismissal of an Immigration and Legal Manager who was hired under probationary employment barely a month on the job was valid. He betrayed his negative attitude and regard for the company, his co-employees and his work. He refused to attend the company’s “Values Formation Seminar” which reflects on the kind of person and employee he was. It highlights his lack of interest in familiarizing himself with the company’s objectives and policies. It also reveals his lack of interest in establishing good working relationship with his co-employees; it betrays an arrogant and condescending attitude on his part towards his co-employees, and a lack of support for the company objective that company managers be examples to the rank-and-file employees. He exhibited negative working habits as he would take prolonged lunch breaks or would go out of the office—without leave of the company—only to call the personnel manager later to inform the latter he would be unable to return as he had to attend to personal matters. We therefore disagree with the CA that the company could not have fully determined his performance barely one month into his employment. As we said in International Catholic Migration Commission, the probationary term or period denotes its purpose but not its length. To our mind, four weeks was enough for the company to assess his fitness for the job and he was found wanting. However, the company violated his right to due process when he was dismissed on the very day the notice of dismissal was given to him on October 27, 2001. It did not give him a reasonable time, from the effective date of his separation, as required by the rules. An award of Php10,000.00 in nominal damages is appropriate.

r. Skippers United Pacific, Inc. et al., vs. Doza, et al., G.R. No. 175558, February 8, 2012 – Art. 285 of the Labor Code recognizes termination by the employee. The law contemplates the requirement of a written notice of resignation. In the absence of a written resignation, it is safe to presume that the employer terminated the seafarers. Since the termination occurred on January 1999 before the passage of the amendatory RA 10022, we shall apply RA 8042 as un-amended, without touching on the constitutionality of Sec. 7 of RA 10022. The declaration on 29 March 2009 in Serrano vs. Gallant Maritime Services of the constitutionality of the clause “or for three months for every year of the unexpired term, whichever is less” in RA 8042 shall however be given retroactive effect to the termination that occurred in January 1999 because an unconstitutional clause in the law confers no rights, imposes no duties and affords no protection. The unconstitutional provision is inoperative, as if it was not passed at all.


s. Ymbong vs. ABS-CBN Broadcasting Corp. , G.R. No. 184885, March 7, 2012 – The policy of ABS-CBN which considers an employee deemed resigned, or require him/her to resign if he/she runs for public office is valid. It is well within its rights to ensure that it maintains its objectivity and credibility and freeing itself from any appearance of impartiality so that the confidence of the viewing and listening public in it will not be in any way eroded. A similar policy is even stated under RA 9006 otherwise known as the “Fair Election Act.” Moreover, there is no violation of due process. The overt act of the complainant running for public office is tantamount to resignation. He was separated by ABS-CBN not because he was dismissed but because he resigned. Since there was no termination to speak of, the requirement of due process in dismissal cases cannot be made to apply.

t. Blue Sky Trading Company Inc. et al., vs. Blas et al. , G.R. No. 190559, March 7, 2012 – The warehouse personnel who were suspected of stealing intensifying screens, made to explain and were placed under preventive suspension on February 3, 2005 pending investigation cannot validly challenge their preventive suspension. Preventive suspension may be imposed on an employee whose alleged violation is the subject of an investigation. Its purpose is to prevent an employee from causing harm or injury to his colleagues and to the employer. Here, they were issued notices to explain on February 3, 2005. They submitted their written explanation the day after and they were dismissed from service on February 5, 2005. While the Court does not agree with the company’s decision to terminate them from the service for lack of proof, there is no impropriety in placing them under preventive suspension since the period did not exceed the maximum posed by law and there was a valid purpose for the same.

u. Jiao et al., vs. NLRC et al., G.R. No. 182331, April 18, 2012 – Under the Deed of Assignments of Assets and Assumption of Liabilities between Globalbank and Metrobank, the latter accepted the former’s assets in exchange for assuming its liabilities such as deposit liabilities, bills payable etc. However, Metrobank did not assume the liability of Globalbank to pay separation pay to its former employees. This must be so because it is understood that the same liabilities ended when the workers were paid the amounts embodied in their respective acceptance letters and quitclaims. Hence, this obligation could not have been passed on to Metrobank even if the latter is the parent company of Globalbank. As a rule, a corporation that purchases the assets of another will not be liable for the debts of the selling corporation, provided the former acted in good faith and paid adequate consideration for such assets, except when any of the following circumstances is present: 1) where the purchaser expressly or


impliedly agrees to assume the debts; 2) where the transaction amounts to a consolidation or merger of the corporations; 3) where the purchasing corporation is merely a continuation of the selling corporation; and 4) where the selling corporation fraudulently enters into the transaction to escape liability for those debts.

v. International Management Service vs. Logarta, G.R. No. 163657, April 18, 2012 – An OFW who was deployed to work in Saudi Arabia for a foreign employer, both he and his employer are subject to the Labor Code provision on retrenchment, notwithstanding RA 8042. The basic policy in this jurisdiction is that all Filipino workers, whether employed locally or overseas, enjoy the protective mantle of Philippine labor and social legislations. As for the notice requirement, proper notice to the DOLE within 30 days prior to the intended date of retrenchment is necessary and must be complied with despite that the worker is an OFW.

w. Waterfront Cebu City Hotel vs. Jimenez et al. , G.R. No. 174214, June 13, 2012 – The closure of a department or division of a company constitutes retrenchment by, and not closure of, the company itself. Verily, retrenchment and not closure was effected to warrant the valid dismissal of the workers. The hotel has not totally ceased its operations. It merely closed down a department. All the elements for a valid retrenchment were successfully proven. First, the huge losses suffered by the club for the past two years had forced the hotel to close it down to avert further losses which would eventually affect the operations of the hotel. Second, all 45 employees working under the club were served with notice of termination. The corresponding notice was likewise served to the DOLE one month prior to retrenchment. Third, the employees were offered separation pay, most of whom accepted and opted not to join in this complaint. Fourth, cessation or withdrawal from business operations was bona fide in character and not impelled by a motive to defeat or circumvent the tenurial rights of employees. As a matter of fact, as of this writing, the club has not resumed operations. Neither is there a showing that the hotel carried out the closure of the business in bad faith. No labor dispute existed between management and the employees when the latter were terminated.

x. Cosmos Bottling Corp vs. Fermin, G.R. No. 193676 & 194303, June 20, 2012 – The act of taking the cellphone of a co-employee without the latter’s knowledge constituted theft. Theft committed against a co-employee is considered as a case analogous to serious misconduct, for which the penalty of dismissal from service may be meted out to the erring employee, citing John Hancock Life Insurance Corp. vs. Davis, G.R. No. 169549, Sept. 3, 2008, where theft committed by an employee against his fellow employee was


held to be a just cause to terminate employment, analogous to serious misconduct; “analogous cause” includes voluntary and/or willful act or omission of the employee, attesting to an employee’s moral depravity.

y. Reyes-Rayel vs. Philippine Luen Thai Holdings Corp., G.R. No. 174892, July 11, 2012 – Neither can there be a denial of due process due to the absence of a hearing or investigation at the company level. It has been held in a plethora of cases that due process requirement is met when there is simply an opportunity to be heard and to explain one’s side even if no hearing is conducted, citing Perez vs. Philippine Telegraph & Telephone Company where an employee may be afforded ample opportunity to be heard by means of any method, verbal or written, whether in a hearing, conference or some other fair, just and reasonable way. Here, the employee’s written response to the prerequisite notice provided her with an avenue to explain and defend her side and thus served the purpose of due process. That there was no hearing, investigation or right to appeal, which the employee opined to be a violation of company policies, is of no moment since the records is bereft of any showing that there is an existing company policy that requires these procedures with respect to the termination of a CHR Director like the employee or that the company practice calls for the same. There was also no request for a formal hearing on the part of the employee.

z. Verdadero vs. Barney Autolines Group of Companies, et al., G.R. No. 195428, August 29, 2012 – The bus conductor cannot be deemed constructively dismissed. Records do not show any demotion in rank or a diminution in pay made against him. Neither was there any act of clear discrimination, insensibility or disdain committed by the employer against the driver which would justify or force him to terminate his employment with the company. The verbal abuse allegedly committed by the company’s disciplinary officer which was corroborated by a witness, does not constitute constructive dismissal as these acts should have been committed by the employer against the employee. Unlawful acts committed by a co-employee will not bring the matter within the ambit of constructive dismissal. The disciplinary officer is not the employer; his functions do not involve the power or authority to dismiss or even suspend an employee. Such power is exclusively lodged in the company’s management. In fact, records show that the management has been urging the conductor to report back to work not only to face the administrative charge against him but also because of the scarcity and necessity of bus conductors in the company.


aa.Mindanao Terminal & Brokerage Service, Inc. et al. vs. Nagkahiusang Mamumuo sa Minterbro-Southern Philippines Federation of Labor et al., G.R. No. 174300, December 5, 2012 – the failure of the arrastre and stevedoring operator to make work available to its workers at the pier after its repair and rehabilitation, for a period of more than six (6) months resulted in the constructive dismissal of its workers. It failed to call the attention of its client on the latter’s obligation under the Contract of Use of Pier. It failed to show any effort on its part to hold its client to its end of the bargain even though its workers were being forced to be laid off. Effectively, when it allowed its client to abandon its agreement for more than six (6) months without holding its client accountable for such breach, it consented to its client unexplained action and the prejudice it caused to its workers. As it is responsible for the lack of work at the pier, and consequently, the lay-off of its workers, it is liable for the separation from employment of its workers on a ground similar to retrenchment. Thus, applying the 1995 case of Sebuguero, the operator must be held liable. Lay-off is essentially retrenchment and under Article 283 of the Labor Code a retrenched employee is entitled to separation pay equivalent to one (1) month salary or one-half (1/2) month salary per year of service, whichever is higher.

bb.The Orchard Golf & Country Club vs. Francisco , G.R. No. 178125, March 18, 2013 – The transfer of the employee from Club Accountant to the position of Cost Controller amounted to demotion in rank, thereby constituting constructive dismissal. Her transfer was occasioned not by a past infraction or a present one which has just been committed, but by her act of filing a complaint for impropriety against her superior. The transfer was made as a penalty on a charge that has not yet been resolved. To punish one for an offense that has not been proved is truly unfair as it deprives one of due process. The fact that the employee continued to report for work does not necessarily suggest that constructive dismissal has not occurred, nor does it operates as a waiver. Constructive dismissal occurs not when the employees ceases to report for work, but when the unwarranted acts of the employer are committed to the end that the employees continued employment will become so intolerable. In these difficult times, an employee may be left with no choice but to continue with his employment despite abuses committed against him by the employer, and even during the pendency of a labor dispute between them. This should not be taken against the employee. Instead, we must share the burden of his plight, ever aware of the precept that necessitous men are not free men.

cc. Cavite Apparel Inc. et al., vs. Marquez , G.R. No. 172044, February 6, 2013 – Even if the employee failed to present a medical certificate for her sick leave on May 8, 2000 in


violation of company rules on leaves of absences, she cannot be dismissed for gross and habitual neglect of duty. Gross negligence implies want of care in the performance of one’s duties. Habitual neglect imparts repeated failure to perform one’s duties for a period of time. Here, the records are bereft of any indication that apart from the four occasions when she did not report for work, the employee had been cited for any infraction since she started her employment in 1994. Four absences in her six years of service cannot be considered gross and habitual neglect of duty especially so since the absences were spread out over a six month period. Moreover, she had already been penalized for the first three absences, the most serious penalty being a six day suspension for her third absence on April 27, 2000. Thus, the penalty of dismissal was too harsh and unjustified. Even when there exist some rules agreed upon between the employer and employee on the subject of dismissal, the same cannot preclude the State from inquiring on whether [their] rigid application would work too harshly on the employee. This Court will not hesitate to disregard a penalty that is manifestly disproportionate to the infraction committed.

dd.Leopard Security & Investigation Agency vs. Quitoy et al., G.R. No. 186344, February 20, 2013 – the security guards who were relieved from duty due to the expiration of the agencies security service contract cannot complain of illegal dismissal especially since they were directed by their agency to report for work at their office ten days after. Applying Article 286 of the labor Code by analogy, this Court has repeatedly recognized that security guards may be temporarily sidelined by their security agency as their assignments primarily depend on the contracts entered into by the latter with third parties. Temporary “off-detail” or “floating status” is the period of time when security guards are in between assignments or when they are made to wait after being relieved from previous post until they are transferred to a new one. It takes place when, as here, the security agency’s clients decide not to renew their contracts with the agency, resulting in a situation where the available posts under its existing contracts are less than the number of guards in its roster. For as long as such temporary activity does not continue for a period exceeding six months, such temporary “off-detail” or “floating status” is not equivalent to dismissal. Thus, the award of backwages, and separation pay in lieu of reinstatement, is inconsistent with a finding that there was no illegal dismissal.

ee.Alilem Credit Coorperative, Inc. et al., vs. Bandiola, G.R. No. 173489, February 25, 2013 – An employee who committed an extra-marital affair with a married woman who is not his fellow worker in the business establishment may be dismissed for violating the cooperative’s Personnel Policy which penalizes with dismissal any employee “who commits


an act that brings discredit to the organization.” While his act of engaging in extra-marital affairs may be considered personal to him and does not directly affect the performance of his assigned task as bookkeeper, aside from the fact that the act was specifically provided for by the cooperative’s Personnel Policy as one of the grounds for termination of employment, said act raised concerns to the organization as the Board received numerous complaints and petitions from the cooperative members themselves asking for the removal of the employee because of his immoral conduct.

ff. Padillo vs. Rural Bank of Nabunturan, Inc. et al ., G.R. No. 199338, January 21, 2013 ---An ailing employee, 55 years of age, who has served the company for twenty nine (29) years of dedicated service is not eligible to retirement pay under the Labor Code. While he was able to comply with the five (5) year tenure requirement, he however fell short with respect to the sixty (60) year age requirement. The age and tenure requirements are cumulative and non-compliance with one negates the employee’s entitlement to retirement benefits especially since there exists no retirement plan, collective bargaining agreement or any other equivalent contract between the parties which set out the terms and condition for the retirement of employees. Neither was it proven that there exists an established company policy of giving early retirement packages to the bank’s aging employees. Nevertheless, the Court concurs with the CA that financial assistance should be awarded but an increased amount. From Php50,000 to Php75,000 owing to the employee’s twenty nine (29) year of dedicated service. Finally, the Labor Code provisions on termination on the ground of disease under Article 297 does not apply considering that it was the employee and not the bank who severed the employment relations

3. CERTIFICATION ELECTION

a. Legend International Resorts Ltd., vs. Kilusang Manggagawa ng Legenda, G.R. No. 169754, Feb. 23, 2011 – a certification election may be conducted during the pendency of the cancellation proceedings. This is because at the time the petition for certification elction was filed, the petitioning union is presumed to possess the legal personality to file the same. There is no basis for the employer’s assertion that the cancellation of the union’s certificate of registration should retroact to the time of its issuance or that it effectively


nullified all of the union’s activities, including its filing of the petition for certification election and its demand to collectively bargain. Moreover, the legitimacy of the legal personality of the union cannot be collaterally attacked in a petition for certification election proceeding but only through a separate action instituted particularly for the purpose of assailing it.

b. San Miguel Foods Inc. vs. San Miguel Corp Supervisors and Exempt Union, G.R. No. 146206, August 1, 2011 – There should be only one bargaining unit for the employees in Cabuyao, San Fernando and Otis of Magnolia Poultry Products Plant involved in “dressed” chicken processing and Magnolia Poultry Farms engaged in “live” chicken operations. Certain factors, such as specific line of work, working conditions, location of work, mode of compensation, and other relevant conditions do not affect or impede their commonality of interest. Although they seem separate and distinct from each other, the specific tasks of each division are actually interrelated and there exists mutuality of interests which warrants the formation of a single bargaining unit. Moreover, the exclusion from bargaining units of employees who, in the normal course of their duties, become aware of management policies relating to labor relations, is the principal objective to be accomplished by the “confidential employee rule”. Finally, the proceedings for certification election are quasi-judicial in nature, and therefore, decisions rendered in such proceedings can attain finality. Applying the doctrine of res judicata, the issue in the present case pertaining to the coverage of the employees who would constitute the bargaining unit is now a foregone conclusion.

c. Lepanto Consolidated Mining Company vs. The Lepanto Capataz Union, G.R. No. 157086, February 18, 2013 – the capatazes in a large-mining company who were supervising and instructing the miners etc., assessing and evaluating their performance, making regular reports and recommending new systems and procedure of work as well as guidelines for the discipline of employees, were performing functions totally different from those performed by the rank-and-file employees. They differ from the rank-and-file and could by themselves constitute a separate bargaining unit. These capatazes or foremen are not rank-and-file employees because they are an extension of the management, and as such they may influence the rank-and-file workers under them to engage in slowdown or similar activities detrimental to the policies, interests or business objectives of the employers.

4. STRIKES


a. GSIS et al., vs. Villaviza et al. , G.R. No. 180291, July 27, 2010, En Banc – CSC Res. No. 02-1316 regulates the political rights of those in the government service by prohibiting concerted activity or mass action if coupled with intent of effecting work stoppage or service disruption in order to realize their demands of force concession. However, not all such activities are prohibited. Otherwise, we would be totally depriving our brothers and sisters in the government service of their constitutional right to freedom of expression. This is true with regard to the employees’ wearing similarly colored shirts, attending a public hearing at the GSIS-IU office, bringing with them recording gadgets, clenching their fists, some even badmouthing the guards and PGM Garcia for just over an hour involving 20 or 30 employees. This is well protected under the broad definition of “public speech concern.” Respondents’ freedom of speech and expression remains intact; see also GSIS vs. Kapisanan ng mga Manggagawa sa GSIS, G.R. No. 170132, December 6, 2006 – involving between 300 and 800 employees each day, staging a walkout and participating in a mass protest or demonstration outside the GSIS for 4 straight days, where the Court citing 1983 Alliance of Government Workers, 1991 MPSTA and 1997 Jacinto, ruled that where the right of government employees to organize is limited to the formation of unions or associations, without including the right to strike. They cannot engage in mass leaves, walkouts and other forms of mass action; whether the mass action was not meant to press for some economic demands, it has however taken a disruptive approach to attain whatever it was they were specifically after. The absence of such economic-related demand, even if true, did not make such mass action less of a prohibited concerted activity.

b. Automotive Engine Rebuilders Inc. et al., vs. Progresibong Unyon ng Mga Manggagawa sa AER et al., G.R. No. 160138 & 160192, July 13, 2011 – the doctrine of in pari delicto applies here where both the employer and the certified union are at fault. Both parties filed charges against each other, blaming the other party for violating labor laws. The company filed a complaint against the union and its 18 members for illegal concerted activities. It likewise suspended 7 union members who tested positive for illegal drugs. On the other hand, the union filed a countercharge accusing the company of unfair labor practice, illegal suspension and illegal dismissal. In other words, the company claims that the union was guilty of staging an illegal strike while the union claims that the company committed an illegal lockout. As the parties are both at fault, they should be restored to their respective positions prior to the illegal strike and illegal lockout. The penalty of dismissal imposed against the striking employees who staged a one day walkout was too severe. Nonetheless, if reinstatement is no longer feasible, the concerned employees should be given separation pay up


to the date set for the return of the complaining employees in lieu of reinstatement. In its Resolution of January 16, 2013, the Supreme Court modified its main decision by ordering the reinstatement with payment of backwages of those union members who were not impleaded by the company in its complaint for illegal strike. This award was not however extended to those union members who failed to write their names and affix their signatures in the membership resolution attached to the petition for certiorari filed with the Court of Appeals.

c. Abaria et al., vs. NLRC et al., G.R. No. 154113 & Nava et al., vs. NLRC, G.R. No. 187778, Metro Cebu Community Hospital vs. Nava et al., G.R. No. 187861 & Visayas Community Medical Center vs. Yballe, G.R. No. 196156, December 7, 2011 – A local union which is not independently registered cannot, upon disaffiliation from the federation, exercise the rights and privileges granted by law to the 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 the local union in view of the union’s leadership conflict with the national federation. 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. Moreover, not being a legitimate labor organization nor the certified exclusive bargaining representative of MCCHI’s rank-and-file employees, the local union cannot demand from MCCHI the right to bargain collectively in their behalf. Hence, MCCHI’s refusal to bargain then with the local cannot be considered an unfair labor practice to justify the staging of the strike. Consequently, the mandatory notice of strike and the conduct of the strike vote report were ineffective for having been filed and conducted by one which has no legal personality as a legitimate labor organization. There is thus no question that the local officers knowingly participated in the illegal strike. Their termination was therefore valid and justified. However as regards the union members, their dismissal was illegal since there is no proof that they committed illegal acts. They are generally entitled to reinstatement but without backwages since they did not render work for the employer during the strike. The 2004 case of Bascon vs. CA where the Court awarded reinstatement plus backwages must be set aside as there is an erroneous application of the law insofar as the award of backwages is concerned. The doctrine of stare decisis is not cast in stone. For the Court, as the highest court of the land, may be guided but is not controlled by precedent. Thus the Court, especially


with a new membership, is not obliged to follow blindly a particular decision that it determines, after re-examination, to call for a rectification. However, considering that 15 years had lapsed from the onset of this labor dispute, and in view of the strained relations that ensued, in addition to the reality of replacements already hired by the hospital which had apparently recovered from its huge losses, and with many of the petitioners either employed elsewhere, already old and sickly, or otherwise incapacitated, separation pay without backwages is the appropriate relief.

d. C. Alcantara & Sons Inc., vs. CA et al. , GR No. 155109 & 155135, March 14, 2012 Resolution, reconsidering its main decision of Sept. 29, 2010 by deleting award of separation pay by way of financial assistance, it appearing that the union officers and members who participated in the illegal strike also committed prohibited acts (i.e. threatening non-striking employees, obstructing the ingress to and egress from company premises & resisting and defying writ of preliminary injunction); thus, making them guilty of serious misconduct. Applying Toyota, the award of separation pay by way of financial assistance must be deleted. Note however with regard to the award of accrued salaries brought about by the failure of the employer to exercise its option pending appeal, whether to physically admit or reinstate the workers in the payroll, the award is affirmed. This award was not given as their salaries during the period of the strike. Rather they constitute the employer’s liability to the employees for its failure to exercise the option following the labor arbiter’s decision to reinstate the union members as mandated by Art. 223 of the Labor Code. The employer must pay the employees salaries during the period from notice of the labor arbiter’s order of reinstatement pending appeal until the reversal thereof by the NLRC.

e. Naranjo et al., vs. Biomedica Health Care, Inc. et al., G.R. No. 193789, September 19, 2012 – the absence on November 7, 2006 taken simultaneously by seven (7) of the company’s employees for various personal reasons i.e. “loose bowel movement”, “ophthalmology check-up”, “migraine”, “not feeling well”, “child’s meeting” seven days after they filed a complaint against their employer with the DOLE for salary increases, failure to remit SSS contributions, etc., did not constitute mass leave amounting to an illegal strike in violation of the company’s rules. Mass leave is not defined by the Labor Code. The phrase “mass leave” may refer to a simultaneous availment of authorized leave benefits by a large number of employees in a company. Going on leave or absenting one’s self from work for personal reasons when they have leave benefits is an employee’s right. Here, the company did not submit a copy of the CBA or a company memorandum or circular showing the authorized sick or


vacation leaves which the employees can avail of. Neither is there any document to show the procedure by which such leaves can be enjoyed. Absent such pertinent documentary evidence, the Court can only conclude that the availment of the employees of their respective leaves on November 7, 2006 was authorized, valid and in accordance with the company or CBA rules on entitlement to and availment of such leaves. Mass leave involves a large number of workers. The records are bereft of evidence to establish how many workers are employed in the company. No evidence that 5 employees constitute a substantial number of employees of the company. The company has the burden to prove existence of just causes, and this includes the duty to prove that the leave was large-scale in character and unauthorized.

5. CLASSIFICATION OF EMPLOYEES

a. William Uy Construction Corp., et al. vs. Trinidad , G.R. No. 183250, March 10, 2010 – a driver who worked for a construction company for 16 years involving 35 separate projects with intervals is a project and not a regular employee. Intervals or gaps separated on contract from another. Generally, length of service provides a fair yardstick for determining when an employee initially hired on a temporary basis becomes a permanent one, entitled to the security and benefits of regularization. But this standard will not be fair, if applied to the construction industry, simply because construction firms cannot guarantee work and funding for its payrolls based beyond the life of each project. And getting projects is not a matter of course. They have no control over the decisions and resources of project proponents or owners.

b. Dacuital et al., vs. L.M. Camus Engineering Corp., et al., G.R. No. 176748, September 1, 2010 – a project employee is assigned to a project which begins and ends at determined or determinable times. Employees who work under different project employment contracts fo several years do not automatically becomes regular employees; they can remain as project employees regardless of the number of years they work. Length of service is not a controlling factor in determining the nature of one’s employment. Their rehiring is only a natural consequence of the fact that experienced construction workers are preferred. In fact, employees who are members of a “work pool’ xxx do not become regular employees by reason of that fact alone. They can either be project employees or regular employees. Here however, the petitioners were regular employees. Even though the absence of a written contract does not by itself grant regular status to


petitioners, such contract is evidence that petitioners were informed of the duration and scope of their work and their status as project employees. In this case, where no other evidence was offered, the absence of the employment contracts raises a serious question of whether the employees were properly informed at the onset of their employment of their status as project employees. Moreover, there was no evidence that the employer submitted a report to the DOLE of the employee’s termination due to completion of a project as required by D.O. No. 19.

c. Exodus International Construction Corp., vs. Biscocho, et al., G.R. No. 166109, Feb, 23, 2011 – there are two types of employees in the construction industry. One type is the non-project employees who are considered regular employees. Here, when one project is completed, the complainants were automatically transferred to the next project awarded to the company. There was no employment agreement given to them which clearly spelled out the duration of their employment, the specific work to be performed and that such is made clear to them at the time of hiring. Even assuming they were initially hired as project employees, they acquire the status of regular employees when they were continuously rehired even after the cessation of a project and the tasks performed are vital, necessary and indispensable to the usual business or trade of the employer.

d. St. Paul College Quezon City et al., vs. Ancheta II, et al., G.R. No. 169905, September 7, 2011 ---The employment on probationary status of teaching personnel is not governed purely by the Labor Code. The Labor Code is supplemented with respect to the period of probation by special rules found in the Manual of Regulations for Private Schools. The common practice is for the employer and the teacher to enter into a contract, effective for one school year. At the end of the school year, the employer has the option not to renew the contract, particularly considering the teacher’s performance. If the contract is not renewed, the employment relationship terminates. If the contract is renewed, usually for another school year, the probationary employment continues. Again, at the end of that period, the parties may opt to renew or not to renew the contract. If renewed, this second renewal of the contract for another school year would then be the last year --- since it would be the third school year—of probationary employment. At the end of this third year, the employer may now decide whether to extend a permanent appointment to the employee, primarily on the basis of the employee having met the reasonable standards of competence and efficiency set by the employer. Foe the entire duration of this three year period, the teacher remains under probation. Upon the expiration of his contract of employment, being simply on probation, he cannot automatically claim security of tenure and compel the employer to renew his employment contract.


e. University of the East et al., vs. Pepanio et al. , G.R. No. 193897, January 23, 2013 – A college teacher who was hired on a semester-to-semester basis, serving for 6 1/3 years of service on a full load cannot acquire regular or permanent status, having lack the postgraduate degree prescribed by the Manual of Regulations for Private Schools. The State through BP No. 232 delegated the administration of the education system and the supervision and regulation of educational institutions to the Department of Education. Accordingly, in promulgating the Manual, DECs was exercising its power of regulation over educational institutions, which includes prescribing the minimum academic qualifications for teaching personnel. In 1994 the legislature transferred the power to the CHEDS. And CHEDS charter authorized it to set minimum standards for programs and institutions of higher learning. The Manual continued to apply to colleges and universities and suppletorily the Joint Order until 2010 when CHED issued a Revised Manual which specifically applies only to institutions involved in tertiary education. The requirement of a masteral degree for tertiary education teachers is not unreasonable. The operation of educational institutions involves public interest. The government has the right to ensure that only qualified persons, in possession of sufficient academic knowledge and teaching skills, are allowed to teach in such institutions. Government regulation in this field of human activity is desirable for protecting, not only the students, but the public as well as from ill-prepared teachers, who are lacking in the required scientific or technical knowledge. They may be required to take an examination or to possess postgraduate degrees as prerequisite to employment.

6. UNFAIR LABOR PRACTICE AND UNION MATTERS

a. Tabigue, et al. vs. International Copra Export Corp., G.R. No. 183335, December 23, 2009 – The right of any employee or group of employees to, at any time, present grievances to the employer under Art. 255 of the Labor Code does not imply the right to submit the same to voluntary arbitration. Only disputes involving the union and the company may be referred to the grievance machinery or voluntary arbitrator. Moreover, the NCMB under E.0. 126 is not a quasi-judicial agency. Hence, the Court of Appeals cannot exercise appellate jurisdiction over the NCMB.

b. General Milling Corp. vs. Casio, et al. , G.R. No. 149552, March 10, 2010 – Aside from just and authorized causes for termination of employment, an employee may be dismissed due to enforcement of the union security clause in the CBA. “Union security” is a generic term, which


comprehends “closed shop”, “union shop”, “maintenance of membership”, or any other form of agreement which imposes upon employees the obligation to acquire or retain union membership as a condition affecting employment. These union security clauses are expressly recognized and allowed under Art. 248 (e) of the Labor Code.

c. PICOP Resources Inc., vs. Taneca et al. , G.R. No. 160828, August 9, 2010 – Art. 253 states the duty of both parties to keep the status quo and to continue in full force and effect the terms and conditions of the existing agreement during the 60 day period and/or until a new agreement is reached by the parties. In conjunction therewith, Art. 256 states that at the expiration of the freedom period, the employer shall continue to recognize the majority status of the incumbent bargaining agent where no petition for certification election is filed. The last sentence of Art 253 which provides for automatic renewal pertains only to the economic provisions of the CBA, and does not include representational aspect of the CBA. An existing CBA cannot constitute a bar to a filing of a petition for certification election. When there is a representational issue, the status quo provision in so far as the need to await the creation of a new agreement will not apply. Otherwise, it will create an absurd situation where the union members will be forced to maintain membership by virtue of the union security clause existing under the CBA and, thereafter, support another union when filing a petition for certification election. If we apply it, there will always be an issue of disloyalty whenever the employees exercise their right to self-organization. Here, there was no disloyalty which could be a ground to dismiss the union members under the existing union security clause because while they signed the petition for certification election before the onset of the freedom period, such petition was filed within such period (cited in PICOP Resources Inc., vs. Dequilla et al., , G.R. No. 172666, December 7, 2011, where the Court ruled that the signing of the petition for certification election before the onset of the freedom period, but filing the same within such period is not enough proof of disloyalty and violation of the union security clause which would warrant dismissal. There is no proof of any contemporaneous acts of resignation or withdrawal of union membership or non-payment of union dues. The fact is, private respondents remained in good standing with their union, NAMAPRI-SPFL.)

d. Bank of the Phil Islands vs. BPI Employees Union- Davao Chapter, G.R. No. 164301, August 18, 2010, En banc – the former FEBTC employees that were absorbed by BPI upon the merger between the two banks should be covered by the Union Shop Clause found in the existing CBA between BPI and respondent Union. As such they are required to join the certified bargaining agent existing in BPI, the surviving


corporation. Their joining the certified union would in fact be in the best interest of the former FEBTC employees for it unites their interests with the majority of employees in the bargaining unit. It encourages employees solidarity and affords sufficient protection to the majority status of the union during the life of the CBA which are precisely the objectives of union security clauses, such as the Union Shop Clause involved herein. Moreover, under the law and jurisprudence, only the following kinds of employees are exempted from its coverage, namely, (i) employees who at the time of the union shop agreement takes effect are bona fide members of a religious organization which prohibits its members from joining labor union on religious grounds; (ii) employees already in the service and already members of a union other than the majority at the time the union shop agreement took effect; (iii) confidential employees who are excluded from the rank-and-file bargaining unit; and (iv) employees excluded from the union shop by express terms of the agreement. The situation of the former FEBTC employees does not fall on any of these exceptions. Finally, although all the “assets and liabilities” of FEBTC were transferred to and absorbed by BPI because of the merger, human beings are never embraced in the term “assets and liabilities”. Xxx Assets and liabilities should be deemed to refer only to property rights and obligations of FEBTC and do not include the employment contracts of its personnel. Nothing prevents the FEBTC’s employees from resigning or retiring and seeking employment elsewhere instead of going along with the proposed absorption. Employment is a personal consensual contract and absorption by BPI of a former FEBTC employee without the consent of the employee is in violation of an individual’s freedom to contract. xxx BPI’s absorption of former FEBTC employees was neither by operation of law nor by legal consequences of contract. There was no government regulation or law that compelled the merger of the two banks or the absorption of the employees of the dissolved corporation by the surviving corporation. Here the merger was voluntarily entered into by both banks presumably for some mutually acceptable consideration. In fact, the Corporation Code does not also mandate the absorption of the employees of the non-surviving corporation by the surviving corporation in case of a merger. Note however Resolution dated October 19, 2011 where the Court adopted the theory of automatic assumption espoused by J.Brion and modified its main decision, holding that BPI is deemed to have assumed the employment contracts of FEBTC employees upon effectivity of the merger without break in the continuity of their employment even without express stipulation in the Articles of Merger. Taking a second look, the Court has come to agree with J.Brion’s view that this view will be more in keeping with the dictates of social justice and the State policy of according full protection to labor. In a complete merger situation where


there is a total takeover by one corporation over another and there is silence in the merger agreement on what the fate of the human resource complement shall be, the latter should not be lft in the legal limbo and should be properly provided for, by compelling the surviving entity to absorb the employees. This is what Section 80 of the Corporation Code commands, as the surviving corporation has the legal obligation to assume all the obligations and liabilities of the merged constituent corporation. Xxx There is a need for the surviving corporation to take responsibility for the affected employees and to absorb them into its workforce where no appropriate provision for the merged corporation’s human resources component is made in the Merger plan. However, there is nothing in the pronouncement shall impair the right of an employer to terminate the employment of absorbed employees for a lawful or authorized cause or the right of such an employee to resign, retire or otherwise sever his employment. Whether before or after the merger, subject to existing contractual obligations. In this manner, J.Brion’s theory of automatic assumption may be reconciled with the majority’s concerns with the successor employer’s prerogative to choose its employees and the prohibition against involuntary servitude.

e. Park Hotel et al., vs. Soriano et al., G.R. No. 171118, September 10, 2012 – there exists unfair labor practice when the employees were unceremoniously dismissed from work by reason of their intent to form and organize a union. One employee was barred from entering the company premises with the company’s General Manager shouting at him for having participated in the formation of a union; the other was coerced to resign by the company’s owner and the General Manager in the presence of their goons, while the other was forced by the same company officials to sign a resignation letter. Article 248 (a) of the Labor Code considers it unfair labor practice when an employer interferes, restrains or coerces employees in the exercise of their to self-organization. The company’s owner and the General Manager are not exempt from liability. Verily, a corporation being a juridical entity may act only through its directors, officers and employees. Obligations incurred by them, while acting as corporate agents, are not their personal liability but the direct accountability of the corporation they represent. However these corporate officers may be deemed solidarily liable with the corporation for the termination of employees if they acted with malice or bad faith as in this case where they acted maliciously in order to suppress the workers’ right to self-organization.


f. Digital Telecommunications Philippines, Inc. vs. Digitel Employees Union et al., G.R. No. 184903-04, October 10, 2012 – It is management prerogative to close a department of a telecommunication company. Its decision to outsource its call center operation is a valid reason to close down the operations of a department under which the affected employees were employed. Such action constitutes retrenchment as it involves a closure of a department, citing the 2012 case of Waterfront Cebu City Hotel, not a closure or cessation of business operations. However, the dismissal of the affected employees was not done in good faith. Prior to the cessation of the department’s operations, the Secretary/DOLE had assumed jurisdiction to enjoin the impending strike. The company defied the assumption order by abruptly closing down its department. The closure of a department is not illegal per se. What makes it unlawful is when the closure is undertaken in bad faith. The assumption order directs employees to return to work, and the employer to reinstate the employees. The existence of the assumption order should have prompted the company to observe the status quo. Instead, it proceeded to close down its department. Moreover, the timing of the creation of I-tech whose primary purpose was to provide call center/customer contact service the same service provided by the company’s closed department is dubious. The target of the closure was the union members-employees. The termination of service was not a valid retrenchment; it was an illegal dismissal of employees.

g. Goya Inc. vs. Goya Inc. Employees Union-FFW, G.R. No. 170054, January 21, 2013 –A collective bargaining agreement may validly delimit the free exercise of management prerogative pertaining to the hiring of contractual employees thru a contractor to perform temporary or occasional services. To emphasize, declaring that a particular act falls within the concept of management prerogative is significantly different from acknowledging that such act is a valid exercise thereof. What the VA and the CA correctly ruled was that the company’s act of outsourcing is within the purview of management prerogative. Both did not say, however, that such act is a valid exercise thereof. Here, the CBA of the parties has already provided for the categories in the establishment. [These] categories of employees particularly with respect to casual employees [serve] as limitation to the [company] prerogative to outsource parts of its operations especially when hiring contractual employees. The work to be performed by the contractor here was similar to that of the casual employees. With the provision on casual employees, the hiring of contractual employees from the agency therefore is not in keeping with the spirit and intent of their CBA.

h. Octavio vs. Philippine Long Distance Telephone Company, G.R. No. 175492, February 27, 2013 – the claim of


an individual employee for salary increase under the terms of the existing collective bargaining agreement (CBA) is a matter subject of the grievance machinery, it involving the interpretation and implementation of the pertinent provisions of the CBA. From the denial of his claim by the Union-Management Grievance Committee, his recourse pursuant to the CBA was to elevate his grievance to the Board of Arbitrators for final decision. Here, he instead filed a complaint with the arbitration branch of the NLRC nine months after the resolution of the Union-Management Grievance Committee. His complaint must therefore fail. By failing to abide with the procedure prescribed by the CBA, he is deemed to have waived his right to question the resolution of the Committee. Clearly, he departed from the grievance procedure mandated in the CBA and denied the Board of Arbitrators the opportunity to pass upon a matter over which it has jurisdiction. That has the effect of making the Committee’s resolution binding upon him. Moreover, the Committee’s resolution is not a modification of the CBA. Said resolution is a product of the grievance procedure outlined in the CBA itself. Finally, the denial of his claim for salary increase did not violate Article 100 of the Labor Code against diminution of benefits. Even assuming there is diminution of benefits, Article 100 does not prohibit a union from offering and agreeing to reduce wages and benefits of the employees as the right to free collective bargaining includes the right to suspend it. Bargaining covers a process of finding a reasonable and acceptable solution to stabilize labor-management relations to promote stable industrial peace.

7. NLRC RULES OF PROCEDURE

a. Pentagon Steel Corp. vs. Court of Appeals, et al. , G.R. No. 174141, June 26, 2009 – Actions and/or agreements made by the parties during the conciliation proceedings before the labor arbiter are treated as privileged communication under Art. 233; thus, an offer of compromise does not constitute an admission against interest.

b. Ramirez vs. Court of Appeals, et al. , G.R. No. 182626, December 4, 2009 – while the bond may be reduced upon motion by the employer, this is subject to the conditions that: (1) the motion to reduce the bond shall be based on meritorious grounds; and (2) a reasonable amount in relation to the monetary award is posted by the appellant; otherwise the filing of such motion shall not stop the running of the period to perfect an appeal. The qualification effectively requires that unless the NLRC grants the reduction of the cash bond within the 10 day reglementary period, the employer is still expected to post the cash or surety bond securing the full


amount within the said 10 day period. Nothing in the Labor Code or the NLRC Rules of Procedure authorizes the posting of a bond that is less than the monetary award in the judgment, or deems such insufficient positing as sufficient to perfect the appeal.

c. Anabe vs. Asian Construction (AsiaKonstrukt), et al. , G.R. No. 183233, December 23, 2009 – Under Art. 291 of the Labor Code, money claims shall be filed within 3 years from the time the case of action accrued; otherwise, they shall be barred forever. In the absence of a specific provision of the Code on when a monetary claim accrues, the time for prescription shall be counted “from the day the action may be brought” using Art. 1150 of the Civil Code, referring to the day a claim started as a “legal possibility”, that is the time the employee received his monthly paychecks.

d. Real vs. Sangu Phils., Inc., et al. , G.R. No. 168757, January 19, 2011 – To determine whether a case involves an intra-corporate controversy, and is to be heard and decided by the RTC designated by the Court xxx, two elements must concur: (a) the status or relationship of the parties, and (2) the nature of the question that is the subject of their controversy. Xxx The second element requires that the dispute among the parties be intrinsically connected with the regulation of the corporation. If the nature of the controversy involves matters that are purely civil in character, necessarily, the case does not involve an intra-corporate controversy. Here the petitioner who was undisputedly a stockholder and director was appointed as Manager. However there was no proof of any board resolution that he was appointed by the Board. An office is created by the charter of the corporation and the officer is elected (or appointed) by the directors or stockholders. There is no intra-corporate relationship between the parties insofar as petitioner’s complaint for illegal dismissal is concerned. Moreover, the reasons for terminating the services of petitioner i.e. absences, loss of trust, cutting down operational expenses have something to do with his being a Manager and nothing with his being a director or stockholder. In sum, petitioner’s removal as Manager by the Board involves an issue of illegal dismissal which is within the jurisdiction of the Labor Arbiter and not the regular court.; see also Matling Industrial and Commercial Corp., et al., vs. Coros, G.R. No. 157802, October 13, 2010 - Under Sec. 25 of the Corporation Code, the corporate officers are the President, Secretary, Treasurer and such other officers as may be provided in the By-laws. Accordingly, the corporate officers in the context of PD 902-A are exclusively those that are given that character either by the Corporation Code or by the corporation’s By-laws. A different interpretation can easily leave the way open for the Board of Directors to circumvent the constitutionally guaranteed security of tenure of the employee by the expedient inclusion in the By-Laws of an


enabling clause on the creation of just any corporate officer position. Moreover, the Board could not validly delegate the power to create a corporate office to the President, in light of Sec. 25 of the Corporation Code requiring the Board itself to elect the corporate officers. Verily, the power to elect the corporate officers was a discretionary power that the law exclusively vested in the Board, and could not be delegated to subordinate officers or agents. Thus the office of Vice President for Finance and Administration created by the corporation’s President pursuant to an enabling clause in the By-laws was an ordinary, not a corporate, office.; see also Okol vs. Slimmer’s World International, et al., G.R. No. 160146, December 11, 2009 – petitioner was a director and officer of Slimmer’s World. The charges of illegal suspension, illegal dismissal, unpaid commissions etc., fall squarely within the ambit of intra-corporate disputes. A corporate officer’s dismissal is always a corporate act. The question of remuneration involving a stockholder and officer, not a mere employee is not a simple labor problem but a matter that comes within the area of corporate affairs and management and is a corporate controversy. It is not the NLRC but the regular courts which have jurisdiction over the present case.

e. Islriz Trading/Lu vs. Capada et al., G.R. No. 168501, January 31, 2011 – Citing Garcia En Banc, even if the order of reinstatement of the Labor Arbiter is reversed on appeal, the employer is still obliged to reinstate and pay the wages of the employee during the period of appeal until reversal by a higher court or tribunal. The reinstated employee is entitled to his accrued salaries from the time the employer received a copy of the decision of the Labor Arbiter declaring the employee’s dismissal illegal and ordering his reinstatement up to the date of the NLRC resolution overturning that of the Labor Arbiter. It is during the said period that the reinstated employee is deemed to have been illegally dismissed and is entitled to reinstatement pursuant to the labor arbiter’s decision which was the one in effect at that time. Beyond that period, the NLRC resolution declaring that there was no illegal dismissal is already the one prevailing. From such point, the employee’s accrued salary did not accrue not only because there is no more illegal dismissal to speak of but also because the employee has not yet been actually reinstated and has rendered services to his employer. However, the employee may be barred from collecting the accrued wages, if it is shown that the delay in enforcing the reinstatement pending appeal was without fault on the part of the employer. The two fold test in determining whether an employee is barred from recovering his accrued wages, to wit: (a) there must be actual delay or that the order of reinstatement pending appeal was not executed prior to its reversal; and (b) the delay must not be due to the employer’s unjustified act or omission. Here, the employer has to pay because it did not comply at all with the order of reinstatement after it had received the decision of


the labor arbiter, and a writ of execution was issued, giving as reason it had to refer the matter to its lawyer.

f. Panlilio et al., vs. RTC Br. 51, City of Manila , G.R. No. 173846, Feb. 2, 2011 – where the officers of a corporation are the subject of criminal prosecution under the SSS Law for non-remittance of contributions, the rehabilitation of the corporation is not a ground for the extinction of the officers’ criminal liabilities. There is no reason why criminal proceedings should be suspended during corporate rehabilitation. Such prosecution has no bearing on the pending rehabilitation since the officers were charged in their individual capacities. The rehabilitation receiver can still fully discharge his functions as he is not charged to defend the corporate officers. If there is anything that the rehabilitation receiver might be remotely interested in is whether the court also rules that these corporate officers are civilly liable. In such an event of civil award, the same shall falls under the category of claims, the execution of which would be subject to the stay order issued by the rehabilitation court. Only to this extent can the order of suspension be considered obligatory upon any court, tribunal, branch or body where there are pending actions for claims against the distressed corporation.

g. Ando vs. Campo, G.R. No. 184007, Feb. 16, 2011 – when a property belong to the spouses as conjugal is levied upon by the NLRC sheriff to satisfy a judgment award in the labor case, the remedy is to file a third party claim under the NLRC Manual on the Execution of Judgment. The rules of court apply only by analogy or in a suppletory character. The power of the NLRC or the courts to execute its judgment extends only to properties unquestionably belonging to the judgment debtor alone. The property belongs to a third party, i.e. conjugal partnership, and petitioner’s wife may be considered a third party. The wife who is not a party to the labor case stands to lose the property without due process of law. Such third party claim is within the cognizance of the NLRC and not the regular court. Execution is an essential part of the proceedings before the NLRC. Further underscoring the RTC’s lack of jurisdiction is Article 254 of the Labor Code.

h. DUP Sound Phils et al., vs. Court of Appeals et al., G.R. No. 168317, November 21, 2011 ---Reinstatement means restoration to a state or condition from which one had been removed or separated. The person reinstated assumes the position he had occupied prior to his dismissal. Reinstatement presupposes that the previous position from which one had been removed still exists, or that there is an unfilled position which is substantially equivalent or of similar nature as the one previously occupied by the employee. Based on the foregoing principles, it cannot be said that the petitioners intended to reinstate private respondent neither to his former position under the same terms and conditions nor to a


substantially equivalent position. To begin with, the notice that petitioners sent to private respondent requiring the latter to report back to work is silent with regard to the position or exact nature they wanted the private respondent to assume. Indeed, as it turned out, petitioners had other plans for private respondent. Thus, private respondent’s assignment to a different job as well as transfer of work assignment without any justification therefor, cannot be deemed as faithful compliance with the reinstatement order. Private respondent may not be faulted for rejecting what petitioners claim as compliance with the order to reinstate the former given the totally different nature of the job he was afterwards given and the conditions and working environment under which he was to perform such job.

i. Sarona vs. NLRC, et al. , G.R. No. 185280, January 18, 2012 –The claim of the employer that the employee is barred from questioning with the Court of Appeals under Rule 65 and eventually to the Supreme Court under Rule 45 the manner by which his backwages and separation pay were computed because earlier he had moved for the execution of the NLRC’s decision and was paid in full the amount of the monetary award shortly after a writ of execution was issued is without merit. The petitioner’s receipt of the monetary award adjudicated by the NLRC is not absolute, unconditional and unqualified. His motion to release award contains a reservation, stating in his prayer that it is without prejudice to the outcome of the petition with the CA. It is settled that the prevailing party’s receipt of the full amount of the judgment award pursuant to a writ of execution issued by the labor arbiter does not close or terminate the case if such receipt is qualified as without prejudice to the outcome of the petition for certiorari with the CA. The finality of the NLRC’s decision does not preclude the filing of a petition for certiorari under Rule 65. That the NLRC issues an entry of judgment after the lapse of ten days from the parties receipt of its decision will only give rise to the prevailing party’s right to more for the execution thereof but will not prevent the CA from taking cognizance of a petition for certiorari on jurisdictional and due process considerations. In turn, the decision of the CA may be appealed to the Supreme Court under Rule 45, which would be a continuation of the appellate process over the original case before the CA. Since an appeal to the Supreme Court is not an original and independent action, the filing of a petition for review under Rule 45 cannot be barred by the finality of the NLRC decision in the same way that a petition for certiorari under Rule 65 with the CA cannot. Consequently, if the NLRC decision is reversed and set aside, it is considered void ab initio and thus had never become final and executory.

j. 3 rd Alert Security and Detective Services, Inc. vs. Navia , G.R. No. 200653, June 13, 2012 – Art. 223 of the Labor Code provides that in case there is an order of reinstatement, the


employer must admit the dismissed employee under the same terms and conditions, or merely reinstate the employee in the payroll. The order shall be immediately executor. Thus, the employer cannot escape liability by simply invoking that the reinstated worker did not report for work. The law states that the employer must still reinstate the employee in the payroll. Xxx Here, in spite the finality of the decision of the Labor Arbiter after the same has reached the NLRC on appeal, no earnest effort was made to reinstate the dismissed work. The employer resorted to legal tactics to frustrate the execution of the labor arbiter’s order; for about 4 years, it evaded the obligation to reinstate the dismissed worker. By doing so, it has made a mockery of justice. We thus find it proper under the circumstances to impose treble cots against the employer for its utter disregard to comply with the writ of execution.

k. Radio Philippines Network et al. vs. Yap et al., G.R. No. 187713, August 1, 2012 – An order reinstating a dismissed employee is immediately executory without need of a writ of execution. The new NLRC Rules of Procedure now requires the employer to submit a report of compliance within 10 calendar days from receipt of the LA’s decision, disobedience to which clearly denotes a refusal to reinstate. The employee need no longer file a motion for issuance of a writ of execution, since the LA shall thereafter motu proprio issue the writ. With the new rules, there will be no difficulty in determining the employer’s intransigence in immediately complying with the order. In case of strained relations or non-availability of positions, the employer is given the option to reinstate the employee merely in the payroll, precisely in order to avoid the intolerable presence in the workplace of the unwanted employee. Here the circumstances of the case where the company was accused of being in complicit in the plot to expel them from the union and to terminate their employment, more than amply show that the physical restoration of these workers to their former positions would be impractical and would hardly promote the best interest of both parties. Moreover, the proposal to pay the workers’ salaries through ATM cards, now a wide practice cannot be said to be prejudicial or oppressive since it would not entail any unusual effort by the workers to collect their money. Due to the company’s erratic cash flows, there was nothing illegal also in making the payments on staggered basis as the law only requires that the fortnightly intervals be observed.

l. Portillo vs. Lietz, Inc. et al., G.R. No. 196539, October 10, 2012 – a claim by an employee for unpaid salaries filed with the Labor Arbiter cannot be offset against the employer’s claim for liquidated damages due to the employee’s breach of the non-compete covenant of her employment contract. Citing the 1983 case of Singapore Airlines Limited, “[n]ot all disputes between an employer and his employee fall within the


jurisdiction of the labor tribunals. Applying the 1988 case of San Miguel Corp., “[t]he reasonable causal connection with employer-employee relationship is a requirement not only in employees money claims against the employer but is, likewise, a condition when the claimant is the employer. The 2000 case of Banez is not applicable. There is no causal connection between the employee’s claim for unpaid wages and the employer’s claim for damages for the alleged breach of non-compete employment covenant. The employee’s claim for unpaid salaries did not have anything to do with her alleged violation of the employment contract, as in fact, her separation from employment is not rooted in the alleged contractual violation. She resigned from her employment; she was not dismissed. Moreover, the alleged contractual violation did not arise during the existence of the employer-employee relationship. It was a post-employment matter, a post-employment violation. Citing the 1994 case of Dai-Ichi, a “[n]on-compete clause as in the “Goodwill Clause” with a stipulation that a violation thereof makes the employee liable to his former employer for liquidated damages, refers to post-employment relation of the parties, (the employee has ceased her employment when she resigned). Article 217 of the Labor Code, paragraph 4 –- “[c]laims for actual, moral, exemplary and other forms of damages arising from the employer-employee relations” – does not automatically cover all disputes between an employer and its employee. Where the cause of action was within the realm of Civil Law, jurisdiction belongs to the regular courts. The non-compete clause is a contractual undertaking effective after the cessation of the employment relationship between the parties. In accordance with jurisprudence, breach of the undertaking is a civil law dispute, not a labor case. The offsetting cannot be allowed. The difference in the nature of the credits that one has against the other, conversely, the nature of the debt one owes another, which difference in turn, results in the difference of the forum where the different credits can be enforced, prevents the application of compensation. Simply, the labor tribunal in an employee’s claim for unpaid wages is without authority to allow the compensation of such claims against the post employment claim of the former employer for breach of a post employment condition. The labor tribunal does not have jurisdiction over the civil case of breach of contract. Indeed, the application of compensation is effectively barred by Article 113 of the Labor Code which prohibits wage deductions except in three circumstances.

m.Gonzales vs. Solid Cement Corporation, et al., G.R. No. 198423, October 23, 2012, En Banc, J.Brion – There is nothing illegal in the re-computation of an illegal dismissal decision which contains a monetary award. This step is a necessary consequence that flows from the nature of the illegality of dismissal declared in that decision. A re-computation (or an original computation, if no previous computation has been


made) is part of the law – specifically Article 279 of the Labor Code and the established jurisprudence on this provision – that is read into the decision. By the nature of an illegal dismissal case, the reliefs continue to add on until full satisfaction, as expressed under Article 279 of the Labor Code. The re-computation of the consequences of illegal dismissal upon execution of the decision does not constitute an alteration or amendment of the final decision being implemented. The illegal dismissal ruling stands: only the computation of the monetary consequence of this dismissal is affected and this is not a violation of the principle of immutability of final judgments. That the amount the employer shall now pay has greatly increased is a consequence that it cannot avoid as it is the risk that it ran when it continued to seek recourses against the labor arbiter’s decision. On the components of backwages: a) salary increases from the time of dismissal until actual reinstatement are excluded; b) benefits not yet granted at the time of dismissal are excluded; c) 12% interest must accrue on the total unpaid judgment amount, from the time the Court’s decision (on the merits in the original case) became final; d) payment of 13th month pay and salaries due after the LA’s decision until the illegally dismissed employee was reinstated in the payroll

n. Martos et al., vs. New San Jose Builders, Inc . G.R. No. 192650, October 24, 2012 – The dismissal of the complaints filed by those who did not verify their position papers was correct. The lone signature of Martos would have been sufficient if he was authorized by his co-petitioners to sign for them. Unfortunately, petitioners failed to adduce proof that he was so authorized. The verification requirement is significant, as it is intended to secure an assurance that the allegations in the pleadings are true and correct and not the product of the imagination or matter of speculation, and that the pleading is filed in good faith. The absence of a proper verification is cause to treat the pleading as unsigned and dismissible.

o. Sang-An vs. Equator Knights Detective & Security Agency, Inc. G.R. No. 173189, February 13, 2013 – The requirement of a cash or surety bond as provided under Article 223 of the Labor Code only applies to appeals from the orders of the LA to the NLRC. It does not apply to special civil actions such as petition for certiorari under Rule 65 of the Rules of Court. In fact, nowhere under Rule 65 does not state that a bond is required for the filing of the petition.

8. VOLUNTARY ARBITRATION & PROCEEDINGS


a. Teng vs. Pahagac, et al., G.R. No. 169704, November 17, 2010 – Art. 262-A does not prohibit the filing of a motion for reconsideration. Xxx By allowing a 10 day period, the obvious intent of Congress in amending Art. 263 to Art. 262-A is to provide an opportunity for the party adversely affected by the VA’s decision to seek recourse via a motion for reconsideration or a petition for review under Rule 43 of the Rules of Court filed with the CA. For this reason, an appeal from administrative agencies to the CA via Rule 43 requires exhaustion of available remedies as a condition precedent to a petition under that Rule. In the exercise of its power to promulgate implementing rules and regulations, an implementing agency, such as the DOLE is restricted from going beyond the terms of the law it seeks to implement; it should neither modify nor improve the law. By disallowing reconsideration of the CA’s decision, Sec. 7, Rule XIX of DO 40-03 and Sec 7 of the 2005 Procedural Guidelines went directly against the legislative intent behind Art. 262-A of the Labor Code. See also Lepanto Consolidated Mining Company vs. The Lepanto Capataz Union, G.R. No. 157086, February 18, 2013 – where the filing of a motion for reconsideration with the DOLE Secretary involving the latter’s decision of an appeal from an order of certification election was considered a precondition to the filing of a petition for certiorari, it being consistent with the principle of exhaustion of administrative remedies to afford every opportunity to the DOLE Secretary to resolve the matter and correct itself if need be, citing the 2010 Teng case, this notwithstanding Sec. 15, Rule XI, Book V of the Omnibus Rules which states that the decision of the Secretary on the appeal shall be final and executory.

b. BPI Employees Union-Metro Manila et al., vs. Bank of the Philippine Islands, G.R. Nos. 178699 & 178735, September 21, 2011 –Sec.1, Rule 41 of the Rules of Court explicitly provides that no appeal may be taken from an order of execution, the remedy of an aggrieved party being an appropriate special civil action under Rule 65 of the Rules of Court. Thus, BPI correctly availed of the remedy of certiorari under Rule 65 of the Rules of Court when it assailed the December 6, 2005 order of execution of the Voluntary Arbitrator.

c. Ace Navigation Co., Inc. et al., vs. Fernandez , G.R. No. 197309, October 10, 2012 – a complaint for disability benefits by a seaman against the vessel owner where the parties are covered by the AMOSUP-TCC collective bargaining agreement (CBA) which stipulates that disputes between the seafarer and the company shall be settled through the grievance machinery and mandatory voluntary arbitration is outside the jurisdiction of the Labor Arbiter. Aside from Sec. 3, Article XIII (on Social Justice & Human Rights) of the Constitution, Articles


260 to 262 of the Labor Code, Sec. 29 of the POEA-SEC on Dispute Settlement Procedures governs the employment of Filipino seafarers where there exists a CBA between the parties. Here, the CBA, like the grievance machinery created under Article 261 of the Labor Code, has a two-tiered mechanism, with voluntary arbitration as the last step. We reject the seafarer’s argument that he never referred his claim to the grievance machinery and that the parties are not the union and the employer. Needless to state, no such distinction exists in the parties CBA and the POEA-SEC. We are upholding the jurisdiction of the voluntary arbitrator or panel of voluntary arbitrators over the present dispute, not only because of the clear language of the parties’ CBA on the matter; more importantly, we so uphold the voluntary arbitrator’s jurisdiction, in recognition of the State’s express preference for voluntary modes of dispute settlement, such as conciliation and voluntary arbitration as expressed in the Constitution, the law and the rules. In fact even the IRR of RA No. 10022 even lends support to our ruling as we held in the 2012 estate of Nelson R. Dulay thus: “[I]t is settled that when the parties have validly agreed on a procedure for resolving grievances and to submit a dispute to voluntary arbitration then that procedure should be strictly observed.”

GOOD LUCK!!!

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