Mayor v. Macaraig [Mar. 5, 1991]

24SEP

6. Mayor v. MacaraigFact:RA No. 6715 Declaring Vacant “all positions of the Commissioners, Executive Labor Arbiters and Labor Arbiters of the present National Labor Relations Commissions”The old positions were declared vacant because of the “need to professionalize the higher levels of officialdom invested with adjudicatory powers and functions, and upgrade their qualifications, ranks and salaries or emoluments.”

Issue:The constitutionality of the provisions of RA No. 6715.

Held:The petitioners have the right to remain in office until the expiration of the terms for which they have been appointed, unless sooner removed “for cause provided by law.”

A recognized cause for removal or termination is the abolition by law of his office as a result of reorganization carried out by reason of economy or to remove redundancy of functions, or clear and explicit constitutional mandate for such termination of employment.

Abolition of office is not the same as declaring that office is vacant. The latter would constitute an infringement of the constitutional guarantee of security of tenure.

Villamaria v CA & Bustamante GR No. 165881 April 19, 2006 

FACTS: -  Oscar Villamaria, Jr. was the owner of Villamaria Motors, a sole proprietorship engaged in assembling passenger jeepneys with a public utility franchise to operate along the Baclaran-Sucat route. By 1995, Villamaria stopped assembling jeepneys and retained only nine, four of which operated by employing drivers on a “boundary basis.” One of those drivers was respondent Bustamante.-  Bustamante remitted 450 a day to Villamaria as boundary and kept the residue of his daily earnings as compensation for driving the vehicle. In August 1997, Villamaria verbally agreed to sell the jeepney to Bustamante under a “boundary-hulog scheme”, where Bustamante would remit to Villamaria P550 a day for a period of 4 years; Bustamane would then become the owner of the vehicle and continue to drive the same under Villamaria’s franchise, but with Php 10,000 downpayment.-  August 7, 1997, Villamaria executed a contract entitled “Kasunduan ng Bilihan ng Sasakyan sa Pamamagitan ng Boundary Hulog”. The parties agreed that if Bustamante failed to pay the boundary- hulog for 3 days, Villamaria Motors would hold on to the vehicle until Bustamante paid his arrears, including a penalty of 50 a day; in case Bustamante failed to remit the daily boundary-hulog for a period of one week, the Kasunduan would cease to have the legal effect and Bustamante would have to return the vehicle to Villamaria motors.-  In 1999, Bustamante and other drivers who also had the same arrangement failed to pay their respective

boundary-hulog. The prompted Villamaria to serve a “Paalala”. On July 24, 2000. Villamaria took back the jeepney driven by Bustamante and barred the latter from driving the vehicle.-  Bustamante filed a complaint for Illegal Dismissal.

DECISION OF LOWER COURTS:*Labor Arbiter: petition dismissed.*NLRC: dismissed appeal.*CA: reversed NLRC, awarded Bustamante separation pay and backwages. Hence, this petition for review on certiorari. 

ISSUES:(1)  WON the existence of a boundary-hulog agreement negates the employer-employee relationship between the vendor and vendee(2)  WON the Labor Arbiter has jurisdiction over a complaint for illegal dismissal in such a case.HELD: (1) NO. Under the boundary-hulog scheme, a dual juridical relationship is created; that of employer- employee and vendor-vendee. The Kasanduan did not extinguish the employer employee relationship of the parties existing before the execution of said deed. a. Under this system the owner/operator exercises control and supervision over the driver. It is unlike in lease of chattels where the lessor loses complete control over the chattel leased but the lessee is still ultimately responsible for the consequences of its use. The management of the business is still in the hands of the owner/operator, who, being the holder of the certificate of public convenience, must see to it that the driver follows the route prescribed by the franchising and regulatory authority, and the rules promulgated with regard to the business operations.b. The driver performs activities which are usually necessary or desirable in the usual business or trade of the owner/operator. Under the Kasunduan, respondent was required to remit Php 550 daily to petitioner, an amount which represented the boundary of petitioner as well as respondent’s partial payment (hulog) of the purchase price of the jeepney. Thus, the daily remittances also had a dual purpose: that of petitioner’s boundaryand respondent’s partial payment (hulog) for the vehicle. c. The obligation is not novated by an instrument that expressly recognizes the old one, changes only the terms of payment and adds other obligations not incompatible with the old provisions or where the contract merely supplements the previous one. d. The existence of an employment relation is not dependent on how the worker is paid but on the presence or absence of control over the means and method of the work. The amount earned in excess of the “boundary hulog” is equivalent to wages and the fact that the power of dismissal was not mentioned in the Kasunduan did not mean that private respondent never exercised such power, or could not exercise such power. 

(2) YES. The Labor Arbiter and the NLRC has jurisdiction under Article 217 of the Labor Code is limited to disputes arising from an employer-employee relationship which can only be resolved by reference to the Labor Code, other labor statues of their collective bargaining agreement. 

OTHER NOTES: (1) The rule is that the nature of an action and subject matter thereof, as well as, which court or agency of the government has jurisdiction and the character of the reliefs prayed for, whether or not the complainant/plaintiff is entitled to any or all of such reliefs. (2) Not every dispute between an employer and employee involves matters that only the Labor Arbiter and the NLRC can resolve in the exercise of their adjudicatory or quasi-judicial powers. Actions between employers and employees where the employer-employee relationship is merely incidental is within the exclusive original jurisdiction of the regular courts. GR NO. 165881 APRIL 19, 2006 OSCAR VILLAMARIA, JR. (Petitioner) Vs. COURT OF APPEALS AND JERRY V. BUSTAMANTE, (respondents)

FACTS:

                        Petitioner was the owner of the jeepneys which the private respondent is the one who is driving in a “boundary basis”. Villamaria and Bustamante entered into a contract were the petitioner agreed to sell the jeepney entitled “Kasunduan ng Bilihan ng Sasakayan sa Pamamagitan ng Boundary-Hulog” were Bustamante would remit to Villamaria P550.00 a day for a period of four years. Both parties agreed in such terms and stipulations of the contract.When the private respondent failed to pay the boundary-hulog, Villarama took back the jeepney driven by Bustamante and barred the latter from driving the vehicle. Due to the action of petitioner, Bustamante files a complaint before the court.

ISSUE:  Whether employer-employee relations exists.

HELD: The juridical relationship of employer-employee between petitioner and respondent was not negated by the foregoing stipulation in the Kasunduan, considering that petitioner retained control of respondent’s conduct as driver of the vehicle. Even if the petitioner was allowed to let some other person drive the unit, it was not shown that he did so; that the existence of an employment relation is not dependent on how the worker is paid but on the presence or absence of control over the means and method of the work; that the amount earned in excess of the “boundary hulog” is equivalent to wages; and that the fact that the power of dismissal was not mentioned in the Kasunduan did not mean Villamaria never exercised such power, or could not exercise such power. Hence, the employer- employee relationship exists.

G.R. No. 106231; November 16, 1994; 238 scra 194

HAWAIIAN-PHILIPPINE COMPANY vs. REYNALDO J. GULMATICO, Labor Arbiter, Regional Arbitration Branch No. VI, AND NATIONAL FEDERATION OF SUGAR WORKERS-FOOD AND GENERAL TRADES representing all the sugar farm workers of the HAWAIIAN PHILIPPINE MILLING DISTRICT

BIDIN, J.:

Facts: Respondent union, the National Federation of Sugar Workers-Food and General Trades (NFSW-FGT) filed a complaint against herein petitioner Hawaiian-Philippine Company for claims under Republic Act 809 (The Sugar Act of 1952) with the Labor Arbiter. Respondent union claimed that the sugar farm workers within petitioner's milling district have never availed of the benefits due them under the law. RA 809 provides:

Sec.9. In addition to the benefits granted by the Minimum Wage Law, the proceeds of any increase in participation granted to planters under this Act and above their present share shall be divided between the planter and his laborers in the following proportions;

Sixty per centum of the increase participation for the laborers and forty per centum for the planters. The distribution of the share corresponding to the laborers shall be made under the supervision of the Department of Labor.xxx xxx xxx

Petitioner filed its Motion to Dismiss on the ground that public respondent Labor Arbiter has no jurisdiction to entertain and resolve the case as provided in Article 217 of the Labor Code because there is no employer-employee relationship between petitioner milling company and respondent union and farmers, and that respondent union has no cause of

action against petitioner. Public respondent denied petitioner’s Motion to Dismiss. Hence, this petition.

Issues: 1. Whether or not public respondent Labor Arbiter has jurisdiction to hear and decide the case against petitioner.

2. Whether or not respondent union and/or the farm workers represented by it have a cause of action against petitioner.

Held:

1. No. The Supreme Court held for the petitioner. In the case at bar, it is clear that there is no employer-employee relationship between petitioner milling company and respondent union and/or its members-workers. Absent the jurisdictional requisite of an employer-employee relationship between petitioner and private respondent, the inevitable conclusion is that public respondent is without jurisdiction to hear and decide the case with respect to petitioner.

2. No. The Supreme Court likewise held in the negative, respondents do not have a cause of action to institute the present case. To have a cause of action, the claimant must show that he has a legal right and the respondent a correlative duty in respect thereof, which the latter violated by some wrongful act or omission. In the instant case, a simple reading of Section 9 of R.A, would show that the payment of the workers' share is a liability of the planters-employers, and not of the milling company/sugar central (petitioner). Petitioner, according to the Supreme Court, would be a proper third party dependent impleaded because it is directly liable to the planters (the original defendants) for all or part of the workers' claim. However, the planters involved in this controversy have not filed any complaint of such a nature against petitioner, thereby lending credence to the conclusion that petitioner has fulfilled its part vis-a-vis its obligation under RA 809. Hence, the petition is granted.

[G.R. No. 117650. March 7, 1996]

SULPICIO LINES, INC., petitioner, vs. NATIONAL LABOR RELATIONS COMMISSION and JAIME CAGATAN,respondents.

D E C I S I O NKAPUNAN, J.:

Petitioner Sulpicio Lines, Inc., owner of MV Cotabato Princess, on January 15, 1992 dismissed private respondent Jaime Cagatan, a messman of the said vessel, allegedly for being absent without leave for a prolonged period of six (6) months.

As a result of his dismissal, the private respondent filed a complaint for illegal dismissal before the National Labor Relations Commission (NLRC)

through its National Capital Region Arbitration Branch in Manila, docketed as NLRC-NCR Case No. 00-06-3163-92.[1]

Responding to the said complaint, petitioner, on June 25, 1992, filed a Motion to Dismiss on the ground of improper venue, stating, among other things, that the case for illegal dismissal should have been lodged with the NLRCs Regional Branch No. VII (Cebu), as its main office was located in Cebu City.[2]

In an Order dated August 21, 1992 Labor Arbiter Arthur L. Amansec of the NLRC-NCR denied petitioners Motion to Dismiss, holding that:

Considering that the complainant is a ship steward, traveled on board respondents ship along the Manila-Enstancia-Iloilo-Zamboanga-Cotabato vice-versa route, Manila can be said to be part of the complainants territorial workplace. [3]

The aforequoted Order was seasonably appealed to the NLRC by petitioner. On February 28, 1994, respondent NLRC found petitioners appeal unmeritorious and sustained the Labor Arbiters August 21, 1992 ruling, explaining that under the New NLRC Rules, the Commission or the Labor Arbiter before whom the case is pending may order a change of venue.[4] Finding no grave abuse of discretion in the Labor Arbiters assailed Order, respondent NLRC emphasized that:

[T]he complainant instituted the Action in Manila where he resides. Hence, we see no grave abuse of discretion on the part of the labor arbiter in denying the respondents Motion to Dismiss as We find support in the basic principle that the State shall afford protection to labor and that the NLRC is not bound by strict technical rules of procedure.[5]

Undaunted, petitioner sought a reconsideration of the above Order, which the public respondent denied in its Resolution dated July 22, 1994.[6] Consequently, petitioner comes to this Court for relief, in the form of a Special Civil Action for Certiorari under Rule 65 of the Rules of Court, contending that public respondent NLRC acted with grave abuse of discretion amounting to lack or excess of jurisdiction when it issued its assailed rulings.[7]

It is petitioners principal contention that a ship or vessel as workplace is an extension of its homeport or principal place of business, and that being part of the territory of the homeport, (such) vessel is governed to a large extent by the laws and is under the jurisdiction of the homeport.[8] Based on this submission, petitioner avers that its vessel-as-workplace is under the territorial

jurisdiction of the Regional Arbitration branch where (its) . . . principal office is located, which is Branch VII, located in Cebu City.[9]

We disagree.

As early as 1911, this Court held that the question of venue essentially relates to the trial and touches more upon the convenience of the parties, rather than upon the substance and merits of the case. [10] Our permissive rules underlying provisions on venue are intended to assure convenience for the plaintiff and his witnesses and to promote the ends of justice. This axiom all the more finds applicability in cases involving labor and management because of the principle, paramount in our jurisdiction, that the State shall afford full protection to labor.[11]

Even in cases where venue has been stipulated by the parties by contract, this Court has not hesitated to set aside agreements on venue if the same would lead to a situation so grossly inconvenient to one party as to virtually negate his claim. In Sweet Lines vs.Teves,[12] involving a contract of adhesion, we held that:

An agreement will not be held valid where it practically negates the action of the claimants, such as the private respondents herein. The philosophy underlying the provisions on transfer of venue of actions is the convenience of the plaintiffs as well as his witnesses and to promote the ends of justice. Considering the expense and trouble a passenger residing outside Cebu City would incur to prosecute a claim in the City of Cebu, he would most probably decide not to file the action at all. The condition will thus defeat, instead of enhance, the ends of justice. Upon the other hand, petitioner had branches or offices in the respective ports of call of the vessels and can afford to litigate in any of these places. Hence, the filing of the suit in the CFI of Misamis Oriental, as was done in the instant case will not cause inconvenience to, much less prejudice petitioner.[13]

In the case at bench, it is not denied that while petitioner maintains its principal office in Cebu City, it retains a major booking and shipping office in Manila from which it earns considerable revenue, and from which it hires and trains a significant number of its workforce. Its virulent insistence on holding the proceedings in the NLRCs regional arbitration branch in Cebu City is obviously a ploy to inconvenience the private respondent, a mere steward who resides in Metro Manila, who would obviously not be able to afford the frequent trips to Cebu City in order to follow up his case.

Even the provisions cited by petitioner in support of its contention that venue of the illegal dismissal case lodged by private respondent is improperly laid, would not absolutely support his claim that respondent NLRC acted with

grave abuse of discretion in allowing the private respondent to file his case with the NCR arbitration branch.

Section 1, Rule IV of the NLRC Rules of Procedure on Venue, provides that:

Section 1. Venue - (a) All cases in which Labor Arbiters have authority to hear and decide may be filed in the Regional Arbitration Branch having jurisdiction over the workplace of the complainant/petitioner.

This provision is obviously permissive, for the said section uses the word may, allowing a different venue when the interests of substantial justice demand a different one. In any case, as stated earlier, the Constitutional protection accorded to labor is a paramount and compelling factor, provided the venue chosen is not altogether oppressive to the employer.

Moreover, Section 1, Rule IV of the 1990 NLRC Rules additionally provides that, for purposes of venue, workplace shall be understood as the place or locality where the employee is regularly assigned when the cause of action arose. Since the private respondents regular place of assignment is the vessel MV Cotabato Princess which plies the Manila-Estancia-Iloilo-Zamboanga-Cotabato route, we are of the opinion that Labor Arbiter Arthur L. Amansec was correct in concluding that Manila could be considered part of the complainants territorial workplace. Respondent NLRC, therefore, committed no grave abuse of discretion in sustaining the labor arbiters denial of herein petitioners Motion to Dismiss.

WHEREFORE, premises considered, the instant petition is hereby DISMISSED for lack of merit.

SO ORDERED.

G.R. No. L-56431 January 19, 1988

NATIONAL UNION OF BANK EMPLOYEES, In Its Own Right And In Behalf Of CBTC EMPLOYEES Affiliated With It; CBTC EMPLOYEES UNION, In Its Own Right And Interest And In Behalf Of All CBTC Rank And File Employees Including Its Members, BENJAMIN GABAT, BIENVENIDO MORALEDA, ELICITA GAMBOA, FAUSTINO TEVES, SALVADOR LISING, and NESTOR DE LOS SANTOS, petitioners, vs.THE HON. JUDGE ALFREDO M. LAZARO, CFI-MANILA BRANCH XXXV; COMMERCLKL BANK AND TRUST COMPANY OF THE PHILIPPINES; BANK OF THE PHILIPPINE ISLANDS; AYALA CORPORATION; MANUEL J. MARQUEZ; ENRIQUE ZOBEL; ALBERTO VILLA-ABRILLE; VICENTE A. PACIS, JR.; and DEOGRACIAS A. FERNANDO, respondents.

 

SARMIENTO, J.:

The sole issue in this special civil action for certiorari is whether or not the courts may take cognizance of claims for damages arising from a labor controversy.

The antecedent facts are not disputed.

On July 1, 1977, the Commercial Bank and Trust Company, a Philippine banking institution, entered into a collective bargaining agreement with the Commercial Bank and Trust Company Union, representing the rank and file of the bank with a membership of over one thousand employees, and an affiliated local of the National Union of Bank Employees, a national labor organization.

The agreement was effective until June 30, 1980, with an automatic renewal clause until the parties execute a new agreement.

On May 20, 1980, the union, together with the National Union of Bank Employees, submitted to the bank management proposals for the renegotiation of a new collective bargaining agreement. The following day, however, the bank suspended negotiations with the union. The bank had meanwhile entered into a merger with the Bank of the Philippine Islands, another Philippine banking institution, which assumed all assets and liabilities thereof.

As a consequence, the union went to the then Court of First Instance of Manila, presided over by the respondent Judge, on a complaint for specific performance, damages, and preliminary injunction against the private respondents. Among other things, the complaint charged:

xxx xxx xxx

51. In entering in to such arrangement for the termination of the CURRENT CBA, and the consequent destruction to existing rights, interests and benefits thereunder,CBTC is liable for wilful injury to the contract and property rights thereunder as provided in Article 2220 of the Civil Code of the Philippines;

52. By arranging for the termination of the CURRENT CBA in the manner above described, CBTC committed breach of said contract in bad faith, in that CBTC had taken undue advantage of its own employees, by concealing and hiding the negotiations towards an agreement on the sales and merger, when it was under a statutory duty to disclose and bargain on the effects thereof, according to law;

xxx xxx xxx

54. In virtually suppressing the collective bargaining rights of plaintiffs under the law and as provided in the CURRENT CBA, through shadow bargaining, calculated delay, suspension of negotiations, concealment of bargainable issues and high-handed dictation, the CBTC and its defendant officials, as well as the BANK OF P.I. and its defendant officials, were all actuated by a dishonest purpose to secure an undue advantage; on the part of the CBTC it was to avoid fresh and additional contractual commitments, which would substantially lessen and diminish the profitability of the sale; and on the part of the BANKOF P.I., it was to avoid having to face higher compensation rates of CBTC employees in the course of integration and merger which could force the upgrading of the benefit package for the personnel of the merged operations, and thereby pushed personnel costs upwards; substantial

outlays and costs thereby entailed were all deftly avoided and evaded, through the expedient of deliberate curtailment and suppression of contractual bargaining rights;

55. All the other defendants have actively cooperated with and abetted the CBTC and its defendant officers in negotiating, contriving and effecting the above arrangements for the attainment of its dishonest purpose, for abuse of its rights, and for taking undue advantage of its very own employees, through the secret sale and scheduled merger; the collective participation therein evinces machination, deceit, wanton attitude, bad faith, and oppressive intent, wilfully causing loss or injury to plaintiffs in a manner that is contrary to law, morals, good customs and public policy, in violation of Articles 21 and 28 of the Civil Code; 1

xxx xxx xxx

Predictably, the private respondents moved for the dismissal of the case on the ground, essentially, of lack of jurisdiction of the court.

On November 26, 1980, the respondent Judge issued an order, dismissing the case for lack of jurisdiction. According to the court, the complaint partook of an unfair labor practice dispute notwithstanding the incidental claim for damages, jurisdiction over which is vested in the labor arbiter. This order, as well as a subsequent one denying reconsideration, is now alleged as having been issued 'in excess of his jurisdiction amounting to a grave abuse of discretion."

We sustain the dismissal of the case, which is, as correctly held by the respondent court, an unfair labor practice controversy within the original and exclusive jurisdiction of the labor arbiters and the exclusive appellate jurisdiction of the National Labor Relations Commission. The claim against the Bank of Philippine Islands — the principal respondent according to the petitioners — for allegedly inducing the Commercial Bank and Trust Company to violate the existing collective bargaining agreement in the process of re-negotiation, consists mainly of the civil aspect of the unfair labor practice charge referred to under Article 247 2 of the Labor Code.

Under Article 248 3 of the Labor Code, it shall be an unfair labor practice:

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

xxx xxx xxx

(g) To violate the duty to bargain collectively as prescribed by this Code;

xxx xxx xxx

The act complained of is broad enough to embrace either provision. Since it involves collective bargaining — whether or not it involved an accompanying violation of the Civil Code — it may rightly be categorized as an unfair labor practice. The civil implications thereof do not defeat its nature as a fundamental labor offense.

As we stated, the damages (allegedly) suffered by the petitioners only form part of the civil component of the injury arising from the unfair labor practice. Under Article 247 of the Code, "the civil aspects of all cases involving unfair labor practices, which may include claims for damages and other affirmative relief, shall be under the jurisdiction of the labor arbiters. 4

The petitioners' claimed injury as a consequence of the tort allegedly committed by the private respondents, specifically, the Bank of the Philippine Islands, under Article 1314 of the Civil Code, 5 does not necessarily give the courts jurisdiction to try the damage suit. Jurisdiction is conferred by law 6 and not necessarily by the nature of the action. Civil controversies are not the exclusive domain of the courts. In the case at bar, Presidential Decree No. 442, as amended by Batas Blg. 70, has vested such a jurisdiction upon the labor arbiters, a jurisdiction the courts may not assume.

Jurisdiction over unfair labor practice cases, moreover, belongs generally to the labor department of the government, never the courts. In Associated Labor Union v. Gomez, 7 we said:

A rule buttressed upon statute and reason that is frequently reiterated in jurisprudence is that labor cases involving unfair practice are within the exclusive jurisdiction of the CIR. By now, this rule has ripened into dogma. It thus commands adherence, not breach.

The fact that the Bank of the Philippine Islands is not a party to the collective bargaining agreement, for which it "cannot be sued for unfair labor practice at the time of the action," 8 cannot bestow on the respondent court the jurisdiction it does not have. In Cebu Portland Cement Co. v. Cement Workers' Union, 9 we held:

xxx xxx xxx

There is no merit in the allegation. In the first place, it must be remembered that jurisdiction is conferred by law; it is not determined by the existence of an action in another tribunal. In other words, it is not filing of an unfair labor case in the Industrial Court that divests the court of first instance jurisdiction over actions properly belonging to the former. It is the existence of a controversy that properly falls within the exclusive jurisdiction of the Industrial Court and to which the civil action is linked or connected that removes said civil case from the competence of the regular courts. It is for this reason that civil actions found to be intertwined with or arising out of, a dispute exclusively cognizable by the Court of Industrial Relations were dismissed, even if the cases were commenced ahead of the unfair labor practice proceeding, and jurisdiction to restrain picketing was decreed to belong to the Court of Industrial Relations although no unfair labor practice case has as yet been instituted. For the court of first instance to lose authority to pass upon a case, therefore, it is enough that unfair labor practice case is in fact involved in or attached to the action, such fact of course being established by sufficient proof. 10

xxx xxx xxx

Furthermore, to hold that the alleged tortious act now attributed to the Bank of the Philippine Islands may be the subject of a separate suit is to sanction split jurisdiction long recognized to be an offense against the orderly administration of justice. As stated in Nolganza v. Apostol: 11

xxx xxx xxx

As far back as Associated Labor Union vs. Gomez [L-25999, February 9, 1967, 19 SCRA 304] the exclusive jurisdiction of the Court of Industrial Relations in disputes of this character was upheld. "To hold otherwise," as succinctly stated by the ponente, Justice Sanchez, "is to sanction split jurisdiction-which is obnoxious to the orderly administration of justice." Then, in Progressive Labor Association vs. Atlas Consolidated Mining and Development Corporation [L-27585, May 29, 1970, 33 SCRA 349] decided three years later, Justice J.B.L. Reyes, speaking for the Court, stressed that to rule that such demand for damages is to be passed upon by the regular courts of justice, instead of leaving the matter to the Court of Industrial

Relations, 'would be to sanction split jurisdiction, which is prejudicial to the orderly administration of justice'. Thereafter, this Court, in the cases of Leoquinco vs. Canada Dry Bottling Co. [L-28621, February 22, 1971, 37 SCRA 535] and Associated Labor Union v. Cruz ([L-28978, September 22, 1971, 41 SCRA 12], with the opinions coming from the same distinguished jurist, adhered to such a doctrine. The latest case in point, as noted at the outset, is the Goodrich Employees Association decision [L-30211, October 5, 1976, 73 SCRA 297].

xxx xxx xxx

The petitioners' reliance upon Calderon v. Court of Appeals 12 is not well-taken. Calderon has since lost its persuasive force, beginning with our ruling in PEPSI-COLA BOTTLING COMPANY v. MARTINEZ, 13 EBON v. DE GUZMAN, 14 and AGUSAN DEL NORTE ELECTRIC COOP., INC. v. SUAREZ, 15 and following the promulgation of Presidential Decree No. 1691, restoring the jurisdiction to decide money claims unto the labor arbiters.

Neither does the fact that the Bank of the Philippine Islands "was not an employer at the time the act was committed' abate a recourse to the labor arbiter. It should be noted indeed that the Bank of the Philippine Islands assumed "all the assets and liabilities" 16 of the Commercial Bank and Trust Company. Moreover, under the Corporation Code:

xxx xxx xxx

5. The surviving or consolidated corporation shall be responsible and liable for all the liabilities and obligations of each of the constituent corporations in the same manner as if such surviving or consolidated corporation had itself incurred such liabilities or obligations; and any claim, action or proceeding pending by or against any of such constituent corporations may be prosecuted by or against the surviving or consolidated corporation, as the case may be. Neither the rights of creditors nor any lien upon the property of any of such constituent corporations shall be impaired by such merger or consolidation. 17

xxx xxx xxx

In sum, the public respondent has not acted with grave abuse of discretion.

WHEREFORE, the petition is DISMISSED. No costs.

Kawachi vs. CA. G.R. No. 163768 <> xdate, 2006. A LABOR RELATION CASE.

BELOW THIS DIGEST IS THE FULL TEXT OF THE CASE.

FACTS.

1. Private respondent Del quero filed a complaint for damages against the petitioner Kawatchi before the MTC of Quezon city alleging that despite working beyond the working hours, she was not being paid for her corresponding pay and on certain occasion, she was scolded by the petitioner on how she treated the costomer in front of many people and thereafter she was dismissed without affirming her due process.

2. Petitioners moved for the dismissal of the complaint on the grounds of lack of jurisdiction and forum-shopping or splitting causes of action.

3. The MTC ruled that no causal connection appeared between private respondent’s cause of action and the employer-employee relations between the parties.

4. The petitioner filed a petition for certiorari before the RTC who uphold the jurisdiction of the MTC. It held that private respondent’s action for damages was based on the alleged tortious acts committed by her employers and did not seek any relief

under the Labor Code.

5. Petitioner filed a petition for review on certiorari before the Supreme Court questioning the jurisdiction of the MTC over the case.

Issue.

Whether or not, the MTC has jurisdiction over the case.

According to the SC, Article 217(a) of the Labor Code, as amended, clearly bestows upon the Labor Arbiter original and exclusive jurisdiction over claims for damages arising

from employer-employee relations —in other words, the Labor Arbiter has jurisdiction to award not only the reliefs provided by labor laws, but also damages

governed by the Civil Code.

WHEREFORE, the petition for review on certiorari is GRANTED. The two Resolutions dated 20 October 2003 and 29 March 2004 of the Regional Trial Court, Branch

226, Quezon City are REVERSED and SET ASIDE. Costs against private respondent.

G.R. No. 107660 January 2, 1995

RAMON C. LOZON, petitioner, vs.NATIONAL LABOR RELATIONS COMMISSION (Second Division) and PHILIPPINE AIRLINES, INC.,respondents.

 

VITUG, J.:

Petitioner Ramon C. Lozon, a certified public accountant, was a Senior Vice-President-Finance of Private respondent Philippine Airlines, Inc. ("PAL"), when his services were terminated on 19 December 1990 in the aftermath of the much-publicized "two-billion-peso PALscam." Lozon started to work for the national carrier on 23 August 1967 and, for twenty-three years, steadily climbed the corporate ladder until he became one of its vice-presidents.  1

His termination from the service was spawned by a letter sent some time in June 1990 by a member of PAL's board of directors, then Solicitor General Francisco Chavez, to PAL President Dante Santos. Chavez demanded an investigation of twenty-three irregularities allegedly committed by twenty-two high-ranking PAL officials. Among these officials was petitioner; he had been administratively charged by Romeo David, Senior Vice-President for Corporate Services and Logistics Group, for his (Lozon) purported involvement in four cases, labeled "Goldair," "Autographics," "Big Bang of 1983" and "Middle East." 2 Pending the investigation of these cases by a panel 3 constituted by then President Corazon C. Aquino, petitioner was placed under preventive suspension.

In the organizational meeting of the PAL board of directors on 19 October 1990 which occasion Feliciano R. Belmonte, Jr., was elected chairman of the board while Dante G. Santos was designated president and chief executive officer, 4 the board deferred action on the election or appointment of some senior officers of the company who, like petitioner, had been charged with various offenses.

On 18 January 1991, the PAL board of directors issued two resolutions relative to the investigation conducted by the presidential investigating panel in the "Autographics" and "Goldair" cases. In "Autographics," petitioner was charged, along with three other officials, 5 with "gross inefficiency, negligence, imprudence, mismanagement, dereliction of duty, failure to observe and/or implement administrative and executive policies" and with the "concealment, or cover-up and prevention of the seasonal discovery of the anomalous transactions" had with Autographics, Inc., resulting in, among other things, an overpayment by PAL to Autographics in the amount of around P12 million. Petitioner was forthwith considered "resigned from the service . . . for loss of confidence and for acts inimical to the interests of the company." 6 A similar conclusion was arrived at by the PAL board of directors with regard to petitioner in the "Goldair" case where he, together with six other PAL officials,  7 were charged with like "offenses" that had caused PAL's defraudation by Goldair, PAL's general sales agent in Australia, of 14.6 million Australian dollars. 8

Aggrieved by the action taken by the PAL board of directors, petitioner, on 26 June 1991 filed with the National Labor Relations Commission ("NLRC") in Manila a complaint (docketed NLRC-NCR Case No. 00-06-03684-91) for illegal dismissal and for reinstatement, with backwages and "fringe benefits such as Vacation leave, Sick leave, 13th month pay, Christmas Bonus, Medical Expenses, car expenses, trip pass entitlement, etc., plus moral damages of P40 Million, exemplary damages of P10 Million and reasonable attorney's fees." 9

On 09 August 1991, 10 the PAL board of directors also held petitioner as "resigned from the company" for loss of confidence and for acts inimical to the interests of the company in the "Big Bang of 1983" case for his alleged role in the irregularities that had precipitated the write-down (write-off) of assets amounting to P553 million from the books and financial statements of PAL. 11 In the "Middle East" case, the PAL board of directors, on the anomalous administration of commercial marketing arrangements in which PAL had lost an estimated P120 million. 12

PAL defended the validity of petitioner's dismissal before the Labor Arbiter. It questioned at the same time the jurisdiction of the NLRC, positing the theory that since the investigating panel was constituted by then President Aquino, said panel, along with the PAL board of directors, became "a parallel arbitration unit" which, in legal contemplation, should be deemed to have substituted for the NLRC. Thus, PAL averred, petitioner's recourse should have been to appeal his case to the Office of the President. 13 On the other hand, petitioner questioned the authority of the panel to conduct the investigation, asseverating that the charges leveled against him were purely administrative in nature that could have well been ventilated under the grievance procedure outline in PAL's Code of Discipline.

On 17 March 1992, Labor Arbiter Jose G. de Vera rendered a decision ruling for petitioner.  14 The decretal portion of the decision read:

WHEREFORE, all the foregoing premises being considered, judgment is hereby rendered ordering the respondent Philippine Airlines, Inc., to reinstate the complainant to his former position with all the rights, privileges, and benefits appertaining thereto plus backwages, which as of March 15, 1992 already amounted to P2,632,500.00, exclusive of fringes. Further, the respondent company is ordered to pay complainant as follows: P5,000.00 as moral damages; P1,000,000.00 as exemplary damages, and attorney's fees equivalent to ten percent (10%) of all of the foregoing awards.

SO ORDERED. 15

A day after promulgating the decision, the labor arbiter issued a writ of execution. PAL filed a motion to quash the writ petitioner promptly opposed. After the labor arbiter had denied the motion to quash, PAL filed a petition for injunction with the NLRC (docketed NLRC IC Case No. 00261-92). No decision was rendered by NLRC on this petition. 16

Meanwhile, PAL appealed the decision of the labor arbiter by filing a memorandum on appeal, 17 assailing, once again, the jurisdiction of the NLRC but this time on the ground that the issue pertaining to the removal or dismissal of petitioner, a corporate officer, was within the exclusive and original jurisdiction of the Securities and Exchange Commission ("SEC"). Petitioner interposed a partial appeal praying for an increase in the amount of moral and exemplary damages awarded by the labor arbiter. 18

On 24 July 1992, the NLRC rendered a decision (in NLRC NCR Case No. 00-06-03684-91) 19 dismissing the case on the strength of PAL's new argument on the issue of jurisdiction. 20 Petitioner's motion for reconsideration was denied by the NLRC.

The instant petition for certiorari filed with this Court raises these issues: (a) Whether or not the NLRC has jurisdiction over the illegal dismissal case, and (b) on the assumption that the SEC has that jurisdiction, whether or not private respondent is estopped from raising NLRC's lack of jurisdiction over the controversy.

We sustain NLRC's dismissal of the case.

Presidential Decree No. 902-A confers on the SEC original and exclusive jurisdiction to hear and decide controversies and cases involving —

a. Intra-corporate and partnership relations between or among the corporation, officers and stockholders and partners, including their elections or appointments;

b. State and corporate affairs in relation to the legal existence of corporations, partnerships and associations or to their franchises; and

c. Investors and corporate affairs, particularly in respect of devices and schemes, such as fraudulent practices, employed by directors, officers, business associates, and/or other stockholders, partners, or members of registered firms; as well as

d. Petitions for suspension of payments filed by corporations, partnerships or associations possessing sufficient property to cover all their debts but which foresee the impossibility of meeting them when they respectively fall due, or possessing insufficient assets to cover their liabilities and said entities are upon petition or motu propio, placed under the management of a Rehabilitation Receiver or Management Committee.

Specifically, in intra-corporate matters concerning the election or appointment of officers of a corporation, the decree provides:

Sec. 5. In addition to the regulatory and adjudicative functions of the Securities and Exchange Commission over corporations, partnerships and other forms of association registered with it as expressly granted under existing laws and decrees, it shall have original and exclusive jurisdiction to hear and decide cases involving:

xxx xxx xxx

(c) Controversies in the election or appointments of directors, trustees, officers or managers of such corporations, partnerships or association.

Petitioner himself admits that vice presidents are senior members of management, 21 whose designations are no longer than just by means of ordinary promotions. In his own case, petitioner has been elected to the position of Senior Vice-President — Finance Group by PAL's board of directors at its organizational meeting held on 20 October 1989 pursuant to the By-laws, 22 under which, he would serve for a term of one year and until his successor shall have been elected and qualified. 23 Petitioner, for reasons already mentioned, did not get to be re-elected thereafter. 24

In Fortune Cement Corporation v. NLRC, 25 the Court has quoted with approval the Solicitor General's contention that "a corporate officer's dismissal is always a corporate act and/or intra-corporate controversy and that nature is not altered by the reason or wisdom which the Board of Directors may have in taking such action." Not the least insignificant in the case at bench is that petitioner's dismissal is intertwined with still another intra-corporate affair, earlier so ascribed as the "two-billion-peso PALscam," that inevitably places the case under the specialized competence of the SEC and well beyond the ambit of a labor arbiter's normal jurisdiction under the general provisions of Article 217 of the Labor Code. 26

Petitioner contends that the jurisdiction of the SEC excludes its cognizance over claims for vacation and sick leaves, 13th month pay, Christmas bonus, medical expenses, car expenses, and other benefits, as well as for moral damages and attorney's fees. 27 Dy v. NLRC 28 categorically states that the question of remuneration being asserted by an officer of a corporation is "not a simple labor problem

but a matter that comes within the area of corporate affairs and management, and is in fact, a corporate controversy in contemplation of the Corporation Code." With regard to the matter of damages, in Andaya v. Abadia 29 where, in a complaint filed before the Regional Trial Court, the president and general manager of the Armed Forces and Police Savings and Loan Association ("AFPSLAI") questioned his ouster from the stewardship of the association, this Court, in dismissing the petition assailing the order of the trial court which ruled that SEC, not the regular courts, had jurisdiction over the case, has said:

The allegations against herein respondents in the amended complaint unquestionably reveal intra-corporate controversies cleverly conceals, although unsuccessfully, by use of civil law terms and phrases. The amended complaint impleads herein respondents who, in their capacity as directors of AFPSLAI, allegedly convened an illegal meeting and voted for the reorganization of management resulting in petitioner's ouster as corporate officer. While it may be said that the same corporate acts also give rise to civil liability for damages, it does not follow that the case is necessarily taken out of the jurisdiction of the SEC as it may award damages which can be considered consequential in the exercise of its adjudicative powers. Besides, incidental issues that properly fall within the authority of a tribunal may also be considered by it to avoid multiplicity of actions. Consequently, in intra-corporate matters such as those affecting the corporation, its directors, trustees, officers, shareholders, the issue of consequential damages may just as well be resolved and adjudicated by the SEC. (Emphasis supplied.)

We here reiterate the above holdings for, indeed, controversies within the purview of Section 5 of P.D. No. 902-A must not be so constricted as to deny to the SEC the sound exercise of its expertise and competence in resolving all closely related aspects of such corporate disputes.

Petitioner maintains that PAL is estopped, nevertheless, from questioning the jurisdiction of the NLRC considering that PAL did not hold the dispute to be intra-corporate until after the case had already been brought on appeal to the NLRC.

In the first place, there would not be much basis to indicate that PAL was "effectively barred by estoppel." 30 As early as the initial stages of the controversy PAL had already raised the issue of jurisdiction albeit mistakenly at first on the ground that petitioner's recourse was an appeal to the Office of the President. The error could not alter the fact that PAL did question even then the jurisdiction of both the labor arbiter and the NLRC.

It has long been the established rule, moreover, that jurisdiction over a subject matter is conferred by law, 31 and the question of lack of jurisdiction may be raised at anytime even on appeal. 32 In the recent case of La Naval Drug Corporation vs. Court of Appeals, G.R. No. 103200, 31 August 1994, this Court said:

Lack of jurisdiction over the subject matter of the suit is yet another matter. Whenever it appears that the court has no jurisdiction over the subject matter, the action shall be dismissed (Section 2, Rule 9, Rules of Court). This defense may be interpose at any time, during appeal (Roxas vs. Rafferty, 37 Phil. 957) or even after final judgment (Cruzcosa vs. Judge Concepcion, et al., 101 Phil. 146). Such is understandable, as this kind of jurisdiction is conferred by law and not within the courts, let alone the parties, to themselves determine or conveniently set aside. In People vs. Casiano (111 Phil. 73, 93-94), this Court, on the issue of estoppel, held:

"The operation of the principle of estoppel on the question of jurisdiction seemingly depends upon whether the lower court actually had jurisdiction or not. If it had no jurisdiction, but the case was tried and decided upon the theory that it had jurisdiction, the parties are not barred, on appeal, from assailing such jurisdiction, for the same "must exist as a matter of law, and may not be conferred by consent of the parties or by estoppel" (5 C.J.S., 861-863). However, if the lower court had jurisdiction, and the case was heard and decided upon a given theory, such, for instance, as that the court had no jurisdiction, the party who induced it to adopt such theory will not be permitted, on appeal, to assume a inconsistent position — that the lower court had jurisdiction. Here, the principle of estoppel applies. The rule that jurisdiction is conferred by law, and does not depend upon the will of the parties, has no bearing thereon."

Petitioner points to "PAL's scandalous duplicity" in questioning the jurisdiction of the NLRC in this particular controversy while upholding it (NLRC's jurisdiction) in "Robin Dui v. Philippine Airlines" (Case No. 00-4-20267) pending before the Commission. We need not delve into whether or not PAL's conduct does indeed smack of opportunities; suffice it to say that Robin Dui is entirely an independent and separate case and, more than that, it is not before us in this instance.

WHEREFORE, the herein petition for certiorari is DISMISSED, and the decision appealed from is AFFIRMED, without prejudice to petitioner's seeking, if circumstances permit, a recourse in the proper forum. No costs.

SO ORDERED.

G.R. No. 82211-12 March 21, 1989

TERESITA MONTOYA, petitioner, vs.TERESITA ESCAYO, JOY ESCAYO, AIDA GANANCIAL, MARY ANN CAPE, CECILIA CORREJADO, ERLINDA PAYPON and ROSALIE VERDE, AND NATIONAL LABOR RELATIONS COMMISSION, respondents.

Rolando N. Medalla and Segundo Y Chua for petitioner.

The Solicitor General for public respondent.

Archie S. Baribar for private respondents.

 

SARMIENTO, J.:

This petition for certiorari seeks the annullment and setting aside of the resolution 1 9dated August 20, 1987 of the National Labor Relations Commission (NLRC), Third Division, which reversed and set aside the order dated September 27, 1985 of Labor Arbiter Ethelwoldo R. Ovejera of the NLRC's Regional Arbitration Branch No. VI, Bacolod City, dismissing the complaint filed by the private respondents against the petitioner. This petition raises a singular issue, i.e., the applicability of Presidential Decree (P.D.) No. 1508, more commonly known as the Katarungang Pambarangay Law, to labor disputes.

The chronology of events leading to the present controversy is as follows:

The private respondents were all formerly employed as salesgirls in the petitioner's store, the "Terry's Dry Goods Store," in Bacolod City. On different dates, they separately filed complaints for the collection of sums of money against the petitioner for alleged unpaid overtime pay, holiday pay, 13th month pay, ECOLA, and service leave pay: for violation of the minimum wage law, illegal dismissal, and attorney's fees. The complaints, which were originally treated as separate cases, were subsequently consolidated on account of the similarity in their nature. On August 1, 1984, the petitioner-employer moved (Annex "C" of Petition) for the dismissal of the complaints, claiming that among others, the private respondents failed to refer the dispute to the Lupong Tagapayapa for possible settlement and to secure the certification required from the Lupon Chairman prior to the filing of the cases with the Labor Arbiter. These actions were allegedly violative of the provisions of P.D. No. 1508, which apply to the parties who are all residents of Bacolod City.

Acting favorably on the petitioner's motion, Labor Arbiter Ethelwoldo R. Ovejera, on September 27, 1985, ordered the dismissal of the complaints. The private respondents sought the reversal of the Labor Arbiter's order before the respondent NLRC. On August 20, 1987, the public respondent rendered the assailed resolution reversing the order of Ovejera, and remanded the case to the Labor Arbiter for further proceedings. A motion for reconsideration was filed by the petitioner but this was denied for lack of merit on October 28, 1987. Hence, this petition.

It is the petitioner's contention that the provisions of the Katarungang Pambarangay Law (P.D. No. 1508) relative to the prior amicable settlement proceedings before the Lupong Tagapayapa as a jurisdictional requirement at the trial level apply to labor cases. More particularly, the petitioner insists that the failure of the private respondents to first submit their complaints for possible conciliation and amicable settlement in the proper barangay court in Bacolod City and to secure a certification from the Lupon Chairman prior to their filing with the Labor Arbiter, divests the Labor Arbiter, as well as the respondent Commission itself, of jurisdiction over these labor controversies and renders their judgments thereon null and void.

On the other hand, the Solicitor General, as counsel for the public respondent NLRC, in his comment, strongly argues and convincingly against the applicability of P.D. No. 1508 to labor cases.

We dismiss the petition for lack of merit, there being no satisfactory showing of any grave abuse of discretion committed by the public respondent.

The provisions of P.D. No. 1508 requiring the submission of disputes before the barangay Lupong Tagapayapa prior to their filing with the court or other government offices are not applicable to labor cases.

For a better understanding of the issue in this case, the provisions of P.D. No. 1508 invoked by the petitioner are quoted:

SEC. 6. Conciliation pre-condition to filing of complaint. No complaint, petition, action or proceeding involving any matter within the authority of the Lupon as provided in Section 2 hereof shall be filed or instituted in court or any other government office for adjudication unless there has been a confrontation of the parties before the Lupon Chairman or the Pangkat and no conciliation or settlement has been reached as certified by the Lupon Secretary or the Pangkat Secretary, attested by the Lupon or Pangkat Chairman, or unless the settlement has been repudiated. However, the parties may go directly to court in the following cases:

(1) Where the accused is under detention;

(2) Where a person has otherwise been deprived of per sonal liberty calling for habeas corpus proceedings;

(3) Actions coupled with provisional remedies such as preliminary injunction, attachment, delivery of personal property and support pendente lite; and

(4) Where the action may otherwise be barred by the Statute of Limitations.

As correctly pointed out by the Solicitor General in his comment to the petition, even from the three "WHEREAS" clauses of P.D. No. 1508 can be gleaned clearly the decree's intended applicability only to courts of justice, and not to labor relations commissions or labor arbitrators' offices. The express reference to "judicial resources", to "courts of justice", "court dockets", or simply to "courts" are significant. On the other band, there is no mention at all of labor relations or controversies and labor arbiters or commissions in the clauses involved.

These "WHEREAS" clauses state:

WHEREAS, the perpetuation and official recognition of the time-honored tradition of amicably settling disputes among family and barangay members at the barangay level without judicial resources would promote the speedy administration of justice and implement the constitutional mandate to preserve and develop Filipino culture and to strengthen the family as a basic social institution;

WHEREAS, the indiscriminate filing of cases in the courts of justice contributes heavily and unjustifiably to the congestion of court dockets, thus causing a deterioration in the quality of justice;

WHEREAS, in order to help relieve the courts of such docket congestion and thereby enhance the quality of Justice dispensed by the courts, it is deemed desirable to formally organize and institutionalize a system of amicably settling disputes at the barangay level; (Emphasis supplied.)

In addition, Letter of Instructions No. 956 and Letter of Implementation No. 105, both issued on November 12, 1979 by the former President in connection with the implementation of the Katarungang Pambarangay Law, affirm this conclusion. These Letters were addressed only to the following officials: all judges of the Courts of first Instance, Circuit Criminal Courts, Juvenile and Domestic Relations Courts, Courts of Agrarian Relations, City Courts and Municipal Courts, and all Fiscals and other Prosecuting Officers. These presidential issuances make clear that the only official directed to oversee the implementation of the provisions of the Katarungang Pambarangay Law (P.D. No. 1508) are the then Minister of Justice, the then Minister of Local Governments and Community Development, and the Chief Justice of the Supreme Court. If the contention of the petitioner were correct, the then Minister (now Secretary) of Labor and Employment would have been included in the list, and the two presidential issuances also would have been addressed to the labor relations officers, labor arbiters, and the members of the National Labor Relations Commission. Expressio unius est exclusio alterius.

Nor can we accept the petitioner's contention that the "other government office" referred to in Section 6 of P.D. No. 1508 includes the Office of the Labor Arbiter and the Med-Arbiter. The declared concern of the Katarungan Pambarangay Law is "to help relieve the courts of such docket congestion and thereby enhance the quality of justice dispensed by the courts." Thus, the" other government office" mentioned in Section 6 of P.D. No. 1508 refers only to such offices as the Fiscal's Office or, in localities where there is no fiscal, the Municipal Trial Courts, where complaints

for crimes (such as those punishable by imprisonment of not more than 30 days or a, fine of not more than P 200.00) falling under the jurisdiction of the barangay court but which are not amicably settled, are subsequently filed for proper disposition.

But, the opinion of the Honorable Minister of Justice (Opinion No. 59, s. 1983) to the contrary notwithstanding, all doubts on this score are dispelled by The Labor Code Of The Philippines (Presidential Decree No. 442, as amended) itself. Article 226 thereof grants original and exclusive jurisdiction over the conciliation and mediation of disputes, grievances, or problems in the regional offices of the Department of Labor and Employ- ment. It is the said Bureau and its divisions, and not the barangay Lupong Tagapayapa, which are vested by law with originaland exclusive authority to conduct conciliation and mediation proceedings on labor controversies before their endorsement to the appropriate Labor Arbiter for adjudication. Article 226, previously adverted to is clear on this regard. It provides:

ART. 226. Bureau of Labor Relations.- The Bureau of Labor Relations and the Labor relations divisions in the regional officer of the Department of Labor shall have original and exclusive authority to act, at their own initiative or upon request of either or both parties, on all inter-union and intra-union conflicts, and all disputes, grievances or problems arising from or affecting labor-management relations in all workplaces whether agricultural or non-agricultural, except those arising from the implementation or interpretation of collective bargaining agreements which shall be the subject of grievance procedure and/or voluntary arbitration.

The Bureau shall have fifteen (15) working days to act on all labor cases, subject to extension by agreement of the parties, after which the Bureau shall certify the cases to the appropriate Labor Arbiters. The 15-working day deadline, however, shall not apply to cases involving deadlocks in collective bargaining which the Bureau shall certify to the appropriate Labor Arbiters only after all possibilities of voluntary settlement shall have been tried.

Requiring conciliation of labor disputes before the barangay courts would defeat the very salutary purposes of the law. Instead of simplifying labor proceedings designed at expeditious settlement or referral to the proper court or office to decide it finally, the position taken by the petitioner would only duplicate the conciliation proceedings and unduly delay the disposition of the labor case. The fallacy of the petitioner's submission can readily be seen by following it to its logical conclusion. For then, if the procedure suggested is complied with, the private respondent would have to lodge first their complaint with the barangay court, and then if not settled there, they would have to go to the labor relations division at the Regional Office of Region VI of the Department of Labor and Employment, in Bacolod City, for another round of conciliation proceedings. Failing there, their long travail would continue to the Office of the Labor Arbiter, then to the NLRC, and finally to us. This suggested procedure would destroy the salutary purposes of P.D. 1508 and of The Labor Code Of The Philippines. And labor would then be given another unnecessary obstacle to hurdle. We reject the petitioner's submission. It does violence to the constitutionally mandated policy of the State to afford full protection to labor. 2

Finally, it is already well-settled that the ordinary rules on procedure are merely suppletory in character vis-a-vis labor disputes which are primarily governed by labor laws. 3 And "(A)ll doubts in the implementation and interpretation of this Code (Labor), including its implementing rules and regulations, shall be resolved in favor of labor.  4

WHEREFORE, the petition is DISMISSED. Costs against the petitioner.

SO ORDERED.

FEDERICO S. ROBOSA, ROLANDO E. PANDY, NOEL D. ROXAS, ALEXANDER ANGELES, VERONICA GUTIERREZ, FERNANDO EMBAT, and NANETTE H. PINTO,

Petitioners,

- versus -

NATIONAL LABOR RELATIONS COMMISSION (First Division), CHEMO-TECHNISCHE MANUFACTURING, INC. and its responsible officials led by FRANKLIN R. DE LUZURIAGA, and PROCTER & GAMBLE PHILIPPINES, INC.,

Respondents.

G.R. No. 176085

Present:

CARPIO, J., Chairperson,BRION,PEREZ,SERENO, andREYES, JJ.

Promulgated:

February 8, 2012

x------------------------------------------------------------------------------------------x  

D E C I S I O N 

BRION, J.: 

 

 

We resolve the petition for review on certiorari[1] seeking the reversal of the resolutions of the Court of Appeals (CA) rendered on February 24, 2006[2] and December 14, 2006[3] in CA-G.R. SP No. 80436.

  

Factual Background 

Federico S. Robosa, Rolando E. Pandy, Noel D. Roxas, Alexander Angeles, Veronica Gutierrez, Fernando Embat and Nanette H. Pinto (petitioners) were rank-and-file employees of respondent Chemo-Technische Manufacturing, Inc. (CTMI),

the manufacturer and distributor of Wella products. They were officers and members of the CTMI Employees Union-DFA (union). Respondent Procter and Gamble Philippines, Inc. (P & GPI) acquired all the interests, franchises and goodwill of CTMI during the pendency of the dispute. Sometime in the first semester of 1991, the union filed a petition for certification election at CTMI. On June 10, 1991, Med-Arbiter Rasidali Abdullah of the Office of the Department of Labor and Employment in the National Capital Region (DOLE-NCR) granted the petition. The DOLE-NCR conducted a consent election on July 5, 1991, but the union failed to garner the votes required to be certified as the exclusive bargaining agent of the company. On July 15, 1991, CTMI, through its President and General Manager Franklin R. de Luzuriaga, issued a memorandum[4]announcing that effective that day: (1) all sales territories were demobilized; (2) all vehicles assigned to sales representatives should be returned to the company and would be sold; (3) sales representatives would continue to service their customers through public transportation and would be given transportation allowance; (4) deliveries of customers orders would be undertaken by the warehouses; and (5) revolving funds for ex-truck selling held by sales representatives should be surrendered to the cashier (for Metro Manila) or to the supervisor (for Visayas and Mindanao), and truck stocks should immediately be surrendered to the warehouse. On the same day, CTMI issued another memorandum[5] informing the companys sales representatives and sales drivers of the new system in the Salon Business Groups selling operations. The union asked for the withdrawal and deferment of CTMIs directives, branding them as union busting acts constituting unfair labor practice. CTMI ignored the request. Instead, it issued on July 23, 1991 a notice of termination of employment to the sales drivers, due to the abolition of the sales driver positions.[6]

 On August 1, 1991, the union and its affected members filed a complaint for illegal dismissal and unfair labor practice, with a claim for damages, against CTMI, De Luzuriaga and other CTMI officers. The union also moved for the issuance of a writ of preliminary injunction and/or temporary restraining order (TRO).

 The Compulsory Arbitration Proceedings

 The labor arbiter handling the case denied the unions motion for a stay order on the ground that the issues raised by the petitioners can best be ventilated during the trial on the merits of the case. This prompted the union to file on August 16, 1991with the National Labor Relations Commission (NLRC), a petition for the issuance of a preliminary mandatory injunction and/or TRO.[7]

 

On August 23, 1991, the NLRC issued a TRO.[8] It directed CTMI, De Luzuriaga and other company executives to (1) cease and desist from dismissing any member of the union and from implementing the July 23, 1991 memorandum terminating the services of the sales drivers, and to immediately reinstate them if the dismissals have been effected; (2) cease and desist from implementing the July 15, 1991 memorandum grounding the sales personnel; and (3) restore the status quo ante prior to the formation of the union and the conduct of the consent election. Allegedly, the respondents did not comply with the NLRCs August 23, 1991 resolution. They instead moved to dissolve the TRO and opposed the unions petition for preliminary injunction. On September 12, 1991, the NLRC upgraded the TRO to a writ of preliminary injunction.[9] The respondents moved for reconsideration. The union opposed the motion and urgently moved to cite the responsible CTMI officers in contempt of court. On August 25, 1993, the NLRC denied the respondents motion for reconsideration and directed Labor Arbiter Cristeta Tamayo to hear the motion for contempt. In reaction, the respondents questioned the NLRC orders before this Court through a petition for certiorari and prohibition with preliminary injunction. The Court dismissed the petition for being premature. It also denied the respondents motion for reconsideration, as well as a second motion for reconsideration, with finality. This notwithstanding, the respondents allegedly refused to obey the NLRC directives. The respondents defiance, according to the petitioners, resulted in the loss of their employment. 

Meanwhile, the NLRC heard the contempt charge. On October 31, 2000, it issued a resolution[10] dismissing the charge. It ordered the labor arbiter to proceed hearing the main case on the merits.

  The petitioners moved for, but failed to secure, a reconsideration from the

NLRC on the dismissal of the contempt charge. They then sought relief from the CA by way of a petition for certiorari under Rule 65. 

The CA Decision 

The CA saw no need to dwell on the issues raised by the petitioners as the question it deemed appropriate for resolution is whether the NLRCs dismissal of the contempt charge against the respondents may be the proper subject of an appeal. It opined that the dismissal is not subject to review by an appellate court. Accordingly, the CA Special Sixth Division dismissed the petition in its resolution of February 24, 2006.[11]

 The CA considered the prayer of P & GPI to be dropped as party-respondent

moot and academic. 

The petitioners sought a reconsideration, but the CA denied the motion in its resolution of December 14, 2006.[12] Hence, the present Rule 45 petition. 

The Petition 

The petitioners charge the CA with grave abuse of discretion in upholding the NLRC resolutions, despite the reversible errors the labor tribunal committed in dismissing the contempt charge against the respondents. They contend that the respondents were guilty of contempt for their failure (1) to observe strictly the NLRC status quo order; and (2) to reinstate the dismissed petitioners and to pay them their lost wages, sales commissions, per diems, allowances and other employee benefits. They also claim that the NLRC, in effect, overturned this Courts affirmation of the TRO and of the preliminary injunction. 

The petitioners assail the CAs reliance on the Courts ruling that a contempt charge partakes of a criminal proceeding where an acquittal is not subject to appeal. They argue that the facts obtaining in the present case are different from the facts of the cases where the Courts ruling was made. They further argue that by the nature of this case, the Labor Code and its implementing rules and regulations should apply, but in any event, the appellate court is not prevented from reviewing the factual basis of the acquittal of the respondents from the contempt charges. The petitioners lament that the NLRC, in issuing the challenged resolutions, had unconstitutionally applied the law. They maintain that not only did the NLRC unconscionably delay the disposition of the case for more than twelve (12) years; it also rendered an unjust, unkind and dubious judgment. They bewail that [f]or some strange reason, the respondent NLRC made a queer [somersault] from its earlier rulings which favor the petitioners.[13]

 The Case for the Respondents

 Franklin K. De Luzuriaga De Luzuriaga filed a Comment[14] on May 17, 2007 and a Memorandum on December 4, 2008,[15] praying for a dismissal of the petition. De Luzuriaga argues that the CA committed no error when it dismissed the petition for certiorari since the dismissal of the contempt charge against the respondents amounted to an acquittal where review by an appellate court will not lie. In any event, he submits, the respondents were charged with indirect contempt which may be initiated only in the appropriate regional trial court, pursuant to Section 12, Rule 71 of the Rules of Court. He posits that the NLRC has no jurisdiction over an indirect contempt charge. He thus argues that the petitioners improperly brought the contempt charge before the NLRC. Additionally, De Luzuriaga points out that the petition raises only questions of facts which, procedurally, is not allowed in a petition for review on certiorari. Be this as it may, he submits that pursuant to Philippine Long Distance Telephone Company, Inc. v. Tiamson,[16] factual findings of labor officials, who are deemed to have acquired expertise in matters within their respective jurisdictions, are

generally accorded not only respect but even finality. He stresses that the CA committed no reversible error in not reviewing the NLRCs factual findings. Further, De Luzuriaga contends that the petitioners verification and certification against forum shopping is defective because it was only Robosa and Pandy who executed the document. There was no indication that they were authorized by Roxas, Angeles, Gutierrez, Embat and Pinto to execute the required verification and certification. Lastly, De Luzuriaga maintains that the petitioners are guilty of forum shopping as the reliefs prayed for in the petition before the CA, as well as in the present petition, are the same reliefs that the petitioners may be entitled to in the complaint before the labor arbiter.[17]

   P & GPI 

As it did with the CA when it was asked to comment on the petitioners motion for reconsideration,[18] P & GPI prays in its Comment[19] and Memorandum[20] that it be dropped as a party-respondent, and that it be excused from further participating in the proceedings. It argues that inasmuch as the NLRC resolved the contempt charge on the merits, an appeal from its dismissal through a petition for certiorari is barred. Especially in its case, the dismissal of the petition for certiorari is correct because it was never made a party to the contempt proceedings and, thus, it was never afforded the opportunity to be heard. It adds that it is an entity separate from CTMI. It submits that it cannot be made to assume any or all of CTMIs liabilities, absent an agreement to that effect but even if it may be liable, the present proceedings are not the proper venue to determine its liability, if any.

 On December 16, 2008, the petitioners filed a Memorandum[21] raising

essentially the same issues and arguments laid down in the petition. 

The Courts Ruling 

Issues The parties submissions raise the following issues: 

(1)  whether the NLRC has contempt powers;(2)  whether the dismissal of a contempt charge is appealable; and(3)  whether the NLRC committed grave abuse of discretion in dismissing the

contempt charge against the respondents.  On the first issue, we stress that under Article 218[22] of the Labor Code, the

NLRC (and the labor arbiters) may hold any offending party in contempt, directly or indirectly, and impose appropriate penalties in accordance with law. The penalty for direct contempt consists of either imprisonment or fine, the degree or amount depends on whether the contempt is against the Commission or the labor arbiter. The Labor Code, however, requires the labor arbiter or the Commission to deal with indirect contempt in the manner prescribed under Rule 71 of the Rules of Court.[23]

 Rule 71 of the Rules of Court does not require the labor arbiter or the NLRC

to initiate indirect contempt proceedings before the trial court. This mode is to be observed only when there is no law granting them contempt powers. [24] As is clear under Article 218(d) of the Labor Code, the labor arbiter or the Commission is empowered or has jurisdiction to hold the offending party or parties in direct or indirect contempt. The petitioners, therefore, have not improperly brought the indirect contempt charges against the respondents before the NLRC.

 The second issue pertains to the nature of contempt proceedings, especially

with respect to the remedy available to the party adjudged to have committed indirect contempt or has been absolved of indirect contempt charges. In this regard, Section 11, Rule 71 of the Rules of Court states that the judgment or final order of a court in a case of indirect contempt may be appealed to the proper court as in a criminal case. This is not the point at issue, however, in this petition. It is rather the question of whether the dismissal of a contempt charge, as in the present case, is appealable. The CA held that the NLRCs dismissal of the contempt charges against

the respondents amounts to an acquittal in a criminal case and is not subject to appeal.

 The CA ruling is grounded on prevailing jurisprudence. In Yasay, Jr. v. Recto,[25] the Court declared: 

A distinction is made between a civil and [a] criminal contempt. Civil contempt is the failure to do something ordered by a court to be done for the benefit of a party. A criminal contempt is any conduct directed against the authority or dignity of the court.[26]

  

The Court further explained in Remman Enterprises, Inc. v. Court of Appeals[27] and People v. Godoy[28] the character of contempt proceedings, thus

 The real character of the proceedings in contempt cases is to be

determined by the relief sought or by the dominant purpose. The proceedings are to be regarded as criminal when the purpose is primarily punishment and civil when the purpose is primarily compensatory or remedial.Still further, the Court held in Santiago v. Anunciacion, Jr.[29] that: But whether the first or the second, contempt is still a criminal proceeding in which acquittal, for instance, is a bar to a second prosecution. The distinction is for the purpose only of determining the character of punishment to be administered. In the earlier case of The Insurance Commissioner v. Globe Assurance Co.,

Inc.,[30] the Court dismissed the appeal from the ruling of the lower court denying a petition to punish the respondent therein from contempt for lack of evidence. The Court said in that case:

 It is not the sole reason for dismissing this appeal. In the leading

case of In re Mison, Jr. v. Subido, it was stressed by Justice J.B.L. Reyes as ponente, that the contempt proceeding far from being a civil action is of a criminal nature and of summary character in which the court exercises but limited jurisdiction. It was then explicitly held: Hence, as in

criminal proceedings, an appeal would not lie from the order of dismissal of, or an exoneration from, a charge of contempt of court. [footnote omitted]  

Is the NLRCs dismissal of the contempt charges against the respondents beyond review by this Court? On this important question, we note that the petitioners, in assailing the CA main decision, claim that the appellate court committed grave abuse of discretion in not ruling on the dismissal by the NLRC of the contempt charges.[31] They also charge the NLRC of having gravely abused its discretion and having committed reversible errors in:

 (1) setting aside its earlier resolutions and orders, including the writ of

preliminary injunction it issued, with its dismissal of the petition to cite the respondents in contempt of court;

(2) overturning this Courts resolutions upholding the TRO and the writ of preliminary injunction;

(3) failing to impose administrative fines upon the respondents for violation of the TRO and the writ of preliminary injunction; and

(4) failing to order the reinstatement of the dismissed petitioners and the payment of their accrued wages and other benefits.

 In view of the grave abuse of discretion allegation in this case, we deem it

necessary to look into the NLRCs dismissal of the contempt charges against the respondents. As the charges were rooted into the respondents alleged non-compliance with the NLRC directives contained in the TRO[32] and the writ of preliminary injunction,[33] we first inquire into what really happened to these directives. The assailed NLRC resolution of October 31, 2000[34] gave us the following account on the matter - 

On the first directive, x x x We find that there was no violation of the said order. A perusal of the records would show that in compliance with the temporary restraining order (TRO), respondents reinstated back to work the sales drivers who complained of illegal dismissal (Memorandum of Respondents, page 4).

 Petitioners allegation that there was only payroll reinstatement does not make the respondents guilty of contempt of court. Even if the drivers were just in the garage doing nothing, the same does not make respondents guilty of contempt nor does it make them violators of the injunction order. What is important is that they were reinstated and receiving their salaries. As for petitioners Danilo Real, Roberto Sedano and Rolando Manalo, they have resigned from their jobs and were paid their separation pay xxx (Exhibits 6, 6-A, 7, 7-A, 8, 8-A, Respondents Memorandum dated August 12, 1996). The issue of whether they were illegally dismissed should be threshed out before the Labor Arbiter in whose sala the case of unfair labor practice and illegal dismissal were (sic) filed. Records also show that petitioner Antonio Desquitado during the pendency of the case executed an affidavit of desistance asking that he be dropped as party complainant in as much as he has already accepted separation benefits totaling to P63,087.33. With respect to the second directive ordering respondents to cease and desist from implementing the memoranda dated July 15, 1991 designed to ground sales personnel who are members of the union, respondents alleged that they can no longer be restrained or enjoined and that the status quo can no longer be restored, for implementation of the memorandum was already consummated or was a fait accompli. x x x All sales vehicles were ordered to be turned over to management and the same were already sold[.] xxx [I]t would be hard to undo the sales transactions, the same being valid and binding. The memorandum of July 15, 1991 authorized still all sales representatives to continue servicing their customers using public transportation and a transportation allowance would be issued. 

x x x x 

The third directive of the Commission is to preserve the status quo ante between the parties. Records reveal that WELLA AG of Germany terminated its Licensing Agreement with respondent company effective December 31, 1991 (Exhibit 11, Respondents Memorandum).

 On January 31, 1992, individual petitioners together with the other employees were terminated xxx. In fact, this event resulted to the closure of the respondent company. The manufacturing and marketing operations ceased. This is evidenced by the testimony of Rosalito del Rosario and her affidavit (Exh. 9, memorandum of Respondents) as well as Employers Monthly Report on Employees Termination/dismissals/suspension xxx (Exhibits 12-A to 12-F, ibid) as well as the report that there is a permanent shutdown/total closure of all units of operations in the establishment (Ibid). A letter was likewise sent to the Department of Labor and Employment (Exh. 12, Ibid) in compliance with Article 283 of the Labor Code, serving notice that it will cease business operations effective January 31, 1992. 

 The petitioners strongly dispute the above account. They maintain that the

NLRC failed to consider the following: 1. CTMI violated the status quo ante order when it did not restore to their

former work assignments the dismissed sales drivers. They lament that their being garaged deprived them of benefits, and they were subjected to ridicule and psychological abuse. They assail the NLRC for considering the payroll reinstatement of the drivers as compliance with its stay order.

 

They also bewail the NLRCs recognition of the resignation of Danilo Real, Roberto Sedano, Rolando Manalo and Antonio Desquitado as they were just compelled by economic necessity to resign from their employment. The quitclaims they executed were contrary to public policy and should not bar them from claiming the full measure of their rights, including their counsel who was unduly deprived of his right to collect attorneys fees.

 2. It was error for the NLRC to rule that the memorandum, grounding the

sales drivers, could no longer be restrained or enjoined because all sales vehicles were already sold. No substantial evidence was presented by the respondents to prove their allegation, but even if there was a valid sale of the vehicles, it did not relieve the respondents of responsibility under the stay order.

 

3. The alleged termination of the licensing agreement between CTMI and WELLA AG of Germany, which allegedly resulted in the closure of CTMIs manufacturing and marketing operations, occurred after the NLRCs issuance of the injunctive reliefs. CTMI failed to present substantial evidence to support its contention that it folded up its operations when the licensing agreement was terminated. Even assuming that there was a valid closure of CTMIs business operations, they should have been paid their lost wages, allowances, incentives, sales commissions, per diems and other employee benefits from August 23, 1991 up to the date of the alleged termination of CTMIs marketing operations.

 

Did the NLRC commit grave abuse of discretion in dismissing the contempt charges against the respondents? An act of a court or tribunal may only be considered as committed in grave abuse of discretion when it was performed in a capricious or whimsical exercise of judgment which is equivalent to lack of jurisdiction. The abuse of discretion must be so patent and gross as to amount to an evasion of a positive duty enjoined by law, or to act at all in contemplation of law, as where the power is exercised in an arbitrary and despotic manner by reason of passion or personal hostility.[35]

 

The petitioners insist that the respondents violated the NLRC directives, especially the status quo ante order, for their failure to reinstate the dismissed petitioners and to pay them their benefits. In light of the facts of the case as drawn above, we cannot see how the status quo ante or the employer-employee situation before the formation of the union and the conduct of the consent election can be maintained. As the NLRC explained, CTMI closed its manufacturing and marketing operations after the termination of its licensing agreement with WELLA AG of Germany. In fact, the closure resulted in the termination of CTMIs remaining employees on January 31, 1992, aside from the sales drivers who were earlier dismissed but reinstated in the payroll, in compliance with the NLRC injunction. The petitioners termination of employment, as well as all of their money claims, was the subject of the illegal dismissal and unfair labor practice complaint before the labor arbiter. The latter was ordered by the NLRC on October 31, 2000 to proceed hearing the case.[36] The NLRC thus subsumed all other issues into the main illegal dismissal and unfair labor practice case pending with the labor arbiter. On this point, the NLRC declared:

 

Note that when the injunction order was issued, WELLA AG of Germany was still under licensing agreement with respondent company. However, the situation has changed when WELLA AG of Germany terminated its licensing agreement with the respondent, causing the latter to close its business.

 Respondents could no longer be ordered to restore the status quo

as far as the individual petitioners are concerned as these matters regarding the termination of the employees are now pending litigation with the Arbitration Branch of the Commission. To resolve the incident now regarding the closure of the respondent company and the matters alleged by petitioners such as the creations of three (3) new corporations xxx as successor-corporations are matters best left to the Labor Arbiter hearing the merits of the unfair labor practice and illegal dismissal cases.[37]

 We find no grave abuse of discretion in the assailed NLRC ruling. It

rightly avoided delving into issues which would clearly be in excess of its jurisdiction for they are issues involving the merits of the case which are by law within the original and exclusive jurisdiction of the labor arbiter.[38] To be sure, whether payroll reinstatement of some of the petitioners is proper; whether the resignation of some of them was compelled by dire economic necessity; whether the petitioners are entitled to their money claims; and whether quitclaims are contrary to law or public policy are issues that should be heard by the labor arbiter in the first instance. The NLRC can inquire into them only on appeal after the merits of the case shall have been adjudicated by the labor arbiter.

 The NLRC correctly dismissed the contempt charges against the

respondents. The CA likewise committed no grave abuse of discretion in not disturbing the NLRC resolution.

 

In light of the above discussion, we find no need to dwell into the other issues the parties raised.

 WHEREFORE, premises considered, we hereby DENY the petition for

lack of merit and AFFIRM the assailed resolutions of the Court of Appeals.  

SO ORDERED.

  

[G.R. No. 108001. March 15, 1996]

SAN MIGUEL CORPORATION, ANGEL G. ROA and MELINDA MACARAIG, petitioners, vs. NATIONAL LABOR RELATIONS COMMISSION (Second Division), LABOR ARBITER EDUARDO J. CARPIO, ILAW AT BUKLOD NG MANGGAWA (IBM), ET AL., respondents.

SYLLABUS1. LABOR LAW AND SOCIAL LEGISLATION; LABOR CODE; LABOR

ARBITER; ORIGINAL AND EXCLUSIVE JURISDICTION; TERMINATION DISPUTES AND UNFAIR LABOR PRACTICES; EXCEPTIONS; NOT PRESENT IN CASE AT BAR. - The law in point is Article 217 (a) of the Labor Code. It is elementary that this law is deemed written into the CBA. In fact, the law speaks in plain and unambiguous terms that termination disputes, together with unfair labor practices, are matters falling under the original and exclusive jurisdiction of the Labor Arbiter. The sole exception can be found under Article 262 of the same Code, which provides: The voluntary arbitrator or panel of voluntary arbitrators, upon agreement of the parties, shall also hear and decide all other labor disputes including unfair labor practices and bargaining deadlocks. The exception, being present, the Labor Arbiter properly has jurisdiction over the complaint filed by the respondent union for illegal dismissal and unfair labor practice. The filing of a request for reconsideration by the respondent union, which is the condition sine qua non to categorize the termination dispute and the ULP complaint as a grievable dispute as per CBA, was decidedly absent in the case at bench. Hence, the respondent union acted well within their rights in filing their complaint directly with the Labor Arbiter.

2. ID.; ID.; ID.; ID.; ID.; DETERMINED BY ALLEGATIONS OF THE COMPLAINT. The questioned discharges due to alleged redundancy can hardly be considered company personnel policies and therefore need not

directly be subject to the grievance machinery nor to voluntary arbitration. All of the dismissed employees were officers and members of their respective unions, and their employers failed to give a satisfactory explanation as to why this group of employees was singled out. It may be the case that the discharges may really be for a bona fide authorized caused under Article 283 of the Labor Code. But it is also possible that such may be a scheme to camouflage the real intention of discriminating against union members. In any case, these matters will be best ventilated in a hearing before the Labor Arbiter. The complaint alleges facts sufficient to constitute a bona fide case of ULP, cognizable by the Labor Arbiter. This is consistent with the rule that jurisdiction over the subject matter is determined by the allegations of the complaint.

APPEARANCES OF COUNSELRoco Guag Kapunan Migallos & Jardeleza for petitioners.The Solicitor General for public respondent.Potenciano A. Flores, Jr. for private respondents.

D E C I S I O NHERMOSISIMA, JR., J.:

In the herein petition for certiorari under Rule 65, petitioners question the jurisdiction of the Labor Arbiter to hear a complaint for unfair labor practice, illegal dismissal, and damages, notwithstanding the provision for grievance and arbitration in the Collective Bargaining Agreement.

Let us unfurl the facts.

Private respondents, employed by petitioner San Miguel Corporation (SMC) as mechanics, machinists, and carpenters, were and still are, bona fide officers and members of private respondent Ilaw at Buklod ng Manggagawa.

On or about July 31, 1990, private respondents were served a Memorandum from petitioner Angel G. Roa, Vice-President and Manager of SMCs Business Logistics Division (BLD), to the effect that they had to be seperated from the service effective October 31, 1990 on the ground of redundancy or excesss personnel. Respondent union, in behalf of private respondents, opposed the intended dismissal and asked for a dialogue with management.

Accordingly, a series of dialogues were held between petitioners and private respondents. Even before the conclusion of said dialogues, the

aforesaid petitioner Angel Roa issued another Memorandum on October 1, 1990 informing private respondents that they would be dismissed from work effective as of the close of business hours on November 2, 1990. Private respondents were in fact purged on the date aforesaid.

Thus, on February 25, 1991, private respondents filed a complaint against petitioners for Illegal Dismissal and Unfair Labor Practices, with a prayer for damages and attorneys fees, with the Arbitration Branch of respondent National Labor Relations Commission. The complaint[1] was assigned to Labor Arbiter Eduardo F. Carpio for hearing and proper disposition.

On April 15, 1991, petitioners filed a motion to dismiss the complaint, alleging that respondent Labor Arbiter had no jurisdiction over the subject matter of the complaint, and that respondent Labor Arbiter must defer consideration of the unfair labor practice complaint until after the parties have gone through the grievance procedure provided for in the existing Collective Bargaining Agreement (CBA).Respondent Labor Arbiter denied this motion in a Resolution, dated September 23, 1991.

The petitioners appealed the denial to respondent Commission on November 8, 1991. Unimpressed by the grounds therefor, respondent Commission dismissed the appeal in its assailed Resolution, dated August 11, 1992. Petitioners promptly filed a Motion for Reconsideration which, however, was denied through the likewise assailed Resolution, dated October 29, 1992.

Hence, the instant petition for certiorari alleging the following grounds was filed by the petitioners:

I.

RESPONDENT LABOR ARBITER CANNOT EXERCISE JURISDICTION OVER THE ALLEGED ILLEGAL TERMINATION AND ALLEGED ULP CASES WITHOUT PRIOR RESORT TO GRIEVANCE AND ARBITRATION PROVIDED UNDER THE CBA.

II

THE STRONG STATE POLICY ON THE PROMOTION OF VOLUNTARY MODES OF SETTLEMENT OF LABOR DISPUTES CRAFTED IN THE CONSTITUTION AND THE LABOR CODE DICTATES THE SUBMISSION OF THE CBA DISPUTE TO GRIEVANCE AND ARBITRATION.[2]

Petitioners posit the basic principle that a collective bargaining agreement is a contract between management and labor that must bind and be enforced in the first instance as between the parties thereto. In this case, the CBA

between the petitioners and respondent union provides, under Section 1, Article V entitled ARBITRATION, that wages, hours of work, conditions of employment and/or employer-employee relations shall be settled by arbitration. Petitioners thesis is that the dispute as to the termination of the union members and the unfair labor practice should first be settled by arbitration, and not directly by the labor arbiter, following the above provision of the CBA, which ought to be treated as the law between the parties thereto.

The argument is unmeritorious. The law in point is Article 217 (a) of the Labor Code. It is elementary that this law is deemed written into the CBA. In fact, the law speaks in plain and unambiguous terms that termination disputes, together with unfair labor practices, are matters falling under the original and exclusive jurisdiction of the Labor Arbiter, to wit:

Article 217. Jurisdiction of Labor Arbiters and the Commission - (a) Except as otherwise provided under this Code, the Labor Arbiters shall have original and exclusive jurisdiction to hear and decide x x x the following cases involving all workers, whether agricultural or non-agricultural:

(1) Unfair labor practice cases:

(2) Termination disputes;

x x x x x x x x x.

The sole exception to the above rule can be found under Article 262 of the same Code, which provides:

Aricle 262. Jurisdiction over other labor disputes - The voluntary arbitrator or panel of voluntary arbitrators, upon agreement of the parties, shall also hear and decide all other labor disputes including unfair labor practices and bargaining deadlocks. (As added by R.A. 6715)

We subjected the records of this case, particularly the CBA, to meticulous scrutiny and we find no agreement between SMC and the respondent union that would state in unequivocal language that petitioners and the respondent union conform to the submission of termination disputes and unfair labor practices to voluntary arbitration. Section 1, Article V of the CBA, cited by the herein petitioners, certainly does not provide so. Hence, consistent with the general rule under Article 217 (a) of the Labor Code, the Labor Arbiter properly has jurisdiction over the complaint filed by the respondent union on February 25, 1991 for illegal dismissal and unfair labor practice.

Petitioners point however to Section 2, Article III of the CBA, under the heading Job Security, to show that the dispute is a proper subject of the grievance procedure, viz:

x x x The UNION, however, shall have the right to seek reconsideration of any discharge, lay-off or disciplinary action, and such requests for reconsideration shall be considered a dispute or grievance to be dealt with in accordance with the procedure outlined in Article IV hereof [on Grievance Machinery] x x x [3] (Emphasis ours)

Petitioners allege that respondent union requested management for a reconsideration and review of the companys decision to terminate the employment of the union members. By this act, petitioners argue, respondent union recognized that the questioned dismissal is a grievable dispute by virtue of Section 2, Article III of the CBA. This allegation was strongly denied by the respondent union. In a Memorandum filed for the public respondent NLRC, the Solicitor General supported the position of the respondent union that it did not seek reconsideration from the SMC management in regard to the dismissal of the employees.

Petitioners fail miserably to prove that, indeed, the respondent union requested for a reconsideration or review of the management decision to dismiss the private respondents. A punctilious examination of the records indubitably reveals that at no time did the respondent union exercise its right to seek reconsideration of the companys move to terminate the employment of the union members, which request for reconsideration would have triggered the application of Section 2, Article III of the CBA, thus resulting in the treatment of the dispute as a grievance to be dealt with in accordance with the Grievance Machinery laid down in Article IV of, the CBA. Stated differently, the filing of a request. for reconsideration by the respondent union, which is the condition sine qua non to categorize the termination dispute and the ULP complaint as a grievable dispute, was decidedly absent in the case at bench. Hence, the respondent union acted well within their rights in filing their complaint for illegal dismissal and ULP directly with the Labor Arbiter under Article 217 (a) of the Labor Code.

Second. Petitioners insist that involved in the controversy is the interpretation and implementation of the CBA which is grievable and arbitrable by law under Article 217(c) of the Labor Code, viz:

ART. 217(c). Cases arising from the interpretation or implementation of collective bargaining agreements and those arising from the interpretation or enforcement of company personnel policies shall be disposed of by the Labor Arbiter by referring the

same to the grievance machinery and voluntary arbitration as may be provided in said agreements. (As amended by R.A. 6715).

Petitioners theorize that since respondents questioned the discharges, the main question for resolution is whether SMC had the management right or prerogative to effect the discharges on the ground of redundancy, and this necessarily calls for the interpretation or implementation of Article III (Job Security) in relation to Article IV (Grievance Machinery)of the CBA.[4]

Petitioners theory does not hold water. There is no connection whatsoever between SMCs management prerogative to effect the discharges and the interpretation or implementation of Articles III and IV of the CBA. The only relevant provision under Article III that may need interpretation or implementation is Section 2 which was cited herein. However, as patiently pointed out by this court, said provision does not come into play considering that the union never exercised its right to seek reconsideration of the discharges effected by the company. It would have been different had the union sought reconsideration. Such recourse under Section 2 would have been treated as a grievance under Article IV (Grievance Machinery) of the CBA, thus calling for the possible interpretation or implementation of the entire provision on Grievance Machinery as agreed upon by the parties. This was not the case however. The union brought the termination dispute directly to the Labor Arbiter rendering Articles III and IV of the CBA inapplicable for the resolution of this case.

The discharges, petitioners also contend, call for the interpretation or enforcement of company personnel policies, particulary SMCs personnel policies on lay-offs arising from redundacy, and so, they may be considered grievable and arbitrable by virtue of Article 2 17(c). Not necessarily so. Company personnel policies are guiding principles stated in broad, long-range terms that express the philosophy or beliefs of an organizations top authority regarding personnel matters. They deal with matters affecting efficiency and well-being of employees and include, among others, the procedure in the administration of wages, benefits, promotions, transfer and other personnel movements which are usually not spelled out in the collective agreement. The usual source of grievances, however, is the rules and regulations governing disciplinary actions.[5] Judging therefrom, the questioned discharges due to alleged redundancy can hardly be cosidered company personnel policies and therefore need not directly be subject to the grievance machinery nor to voluntary arbitration.

Third. Petitioners would like to persuade us that respondents ULP claims are merely conclusory and cannot serve to vest jurisdiction to the Labor

Arbiters. Petitioners argue with passion: How was the discharges (sic) right to self-organization restrained by their termination? Respondent did not show.. There is no allegation of the existence of anti-union animus or of the ultimate facts showing how the discharges affected the rights to self-organization of individual respondents.[6] In short, petitioners maintain that respondents complaint does not allege a genuine case for ULP.

The Court is not convinced.

The complaint alleges that:

5. Individual complainants are bona fide officers and members of complainant Ilaw at Buklod ng Manggagawa (IBM). They are active and militant in the affairs and activities of the union.

xxx xxx xxx

23. The dismissal or lock-out from work of the individual complainants clearly constitutes an act of unfair labor practices in the light of the fact that the work being performed by the individual complainants are being contracted out by the respondent company, and, therefore, deprives individual complainants of their right to work and it constitutes a criminal violation of existing laws.

xxx xxx xxx

25. The acts of the respondent company in economically coercing employees to accept payment of seperation and/or retirement benefits, pending final resolution of the labor disputes between the parties constitute acts of unfair labor practice in the light of the fact that there is undue interference, restraint, and coercion of employees in the exercise of their right to self-organization and collective bargaining. [7]

Short of pre-empting the proceedings before the Labor Arbiter, the above complaint, makes Out a genuine case for ULP.

In Manila Pencil Co. v. CIR,[8] This Court had occasion to observe that even where business conditions justified a lay-off of employees, unfair labor practices were committed in the form of discriminatory dismissal where only unionists were permanently dismissed. This was despite the valid excuse given by the Manila Pencil Company that the dismissal of the employees was due to the reduction of the companys dollar allocations for importation and that both union members and non-union members were laid-off. The Court, thru Justice Makalintal, rebuffed the petitioner Company and said:

x x x The explanation, however, does not by any means account for the permanent dismissal of five of the unionists, where it does not appear that non-unionists were similarly dismissed.

xxx xxx xxx

And the discrimination shown by the Company strongly is confirmed by the fact that during the period from October 1958 to August 17, 1959 it hired from fifteen to twenty new employees and ten apprentices. It says these employees were for its new lead factory, but is (sic) not shown that the five who had been permanently dismissed were not suitable for work in that new factory.

A similar ruling was made by this Court in Peoples Bank and Trust Co. v. Peoples Bank and Trust Co. Employees Union[9] involving the lay-off by a bank of sixty-five (65) employees who were active union members allegedly by reason of retrechment. The Court likewise found the employer in that case to have committed ULP in effecting the discharges.

This Court was more emphatic however in Bataan Shipyard and Engineering Co., Inc. v. NLRC, et al.:[10]

Under the circumstances obtaining in this case, We are inclined to believe that the company had indeed been discriminatory in selecting the employees who were to be retrenched. All of the retrenched employees are officers and members of the NAFLU. The record of the case is bereft of any satisfactory explanation from the Company regarding this situation. As such, the action taken by the firm becomes highly suspect. It leads Us to conclude that the firm had been discriminating against membership in the NAFLU, an act which amounts to interference in the employees exercise of their right of self-organization. Under Art. 249 (now Art. 248) of the Labor Code of the Philippines, such interference is considered an act of unfair labor practice on the part of the Company x x x. (Emphasis ours)

It matters not that the cause of termination in the above cited cases was retrenchment while that in the instant case was redundancy. The important fact is that in all of these cases, including the one at bar, all of the dismissed employees were officers and members of their respective unions, and their employers failed to give a satisfactory explanation as to why this group of employees was singled out.

It may be the case that employees other than union members may have been terminated also by petitioner SMC on account of its redundancy program. If that is true, the discharges may really be for a bona fide authorized cause under Article 283[11] of the Labor Code. On the other hand, it

is also possible that such may only be a clever scheme of the petitioner company to camouflage its real intention of discriminating against union members particularly the private respondents. In any case, these matters will be best ventilated in a hearing before the Labor Arbiter.

It is for the above reason that we cannot hold the petitioners guilty of the ULP charge. This will be the task of the Labor Arbiter. We however find that based on the cicumstances surrounding this case and settled jurisprudence on the subject, the complaint filed by the private respondents on February 25, 1991 alleges facts sufficient to costitute a bona fide case of ULP, and therefore properly cognizable by the Labor Arbiter under Article 2 17(a) of the Labor Code. This is consistent with the rule that jurisdictioin over the subject matter is determined by the allegations of the complaint.[12]

Finally, petitioners try to impress on this Court the strong State policy on the promotion of voluntary modes of settlement of labor disputes crafted in the Constitution and the Labor Code which dictate the submission of the CBA dispute to grievance and arbitration.[13]

In this regard, the response of the Solicitor General is apt:

Petitioners deserve commendation for divulging and bringing to public respondents attention the noble legislative intent behind the law mandating the inclusion of grievance and voluntary arbitration provisions in the CBA. However, in the absence of an express legal conferment thereof, jurisdiction cannot be appropriated by an official or tribunal (sic) no matter how well-intentioned it is, even in the pursuit of the clearest substantial right (Concurring Opinion of Justice Barredo, Estanislao v. Honrado, 114 SCRA 748, 29 June 1982).[14]

In the same manner, petitioners cannot arrogate into the powers of voluntary arbitrators the original and exclusive jurisdiction of Labor Arbiters over unfair labor practices, termination disputes, and claims for damages, in the absence of an express agreement between the parties in order for Article 262 [15] of the Labor Law to apply in the case at bar.[16]

WHEREFORE, the instant petition is DISMISSED for lack of merit and the resolutions of the National Labor Relations Commission dated August 11, 1992 and October 29, 1992 are hereby AFFIRMED.

SO ORDERED

[G.R. No. 124013. June 5, 1998]

ROSARIO MANEJA, petitioner, vs. NATIONAL LABOR RELATIONS COMMISSION and MANILA MIDTOWN HOTEL, respondents.

D E C I S I O NMARTINEZ, J.:

Assailed in this petition for certiorari under Rule 65 of the Revised Rules of Court are the Resolution[1] dated June 3, 1994 of the respondent National Labor Relations Commission in NLRC NCR-00-10-05297-90, entitled "Rosario Maneja, Complainant, vs. Manila Midtown Hotel, Respondent," which dismissed the illegal dismissal case filed by petitioner against private respondent company for lack of jurisdiction of the Labor Arbiter over the case; and its Resolution[2] dated October 20, 1995 denying petitioner's motion for reconsideration.

Petitioner Rosario Maneja worked with private respondent Manila Midtown Hotel beginning January, 1985 as a telephone operator.She was a member of the National Union of Workers in Hotels, Restaurants and Allied Industries (NUWHRAIN) with an existing Collective Bargaining Agreement (CBA) with private respondent.

In the afternoon of February 13, 1990, a fellow telephone operator, Rowena Loleng received a Request for Long Distance Call (RLDC) form and a deposit of  P500.00 from a page boy of the hotel for a call by a Japanese guest named Hirota Ieda. The call was unanswered. The P500.00 deposit was forwarded to the cashier. In the evening, Ieda again made an RLDC and the page boy collected another P500.00 which was also given to the operator Loleng. The second call was also unanswered. Loleng passed on the RLDC to petitioner for follow-up. Petitioner monitored the call.

On February 15, 1990, a hotel cashier inquired about the P1,000.00 deposit made by Ieda. After a search, Loleng found the first deposit of P500.00 inserted in the guest folio while the second deposit was eventually discovered inside the folder for cancelled calls with deposit and official receipts.

When petitioner saw that the second RLDC form was not time-stamped, she immediately placed it inside the machine which stamped the date February 15, 1990. Realizing that the RLDC was filed 2 days earlier, she wrote and changed the date to February 13, 1990. Loleng then delivered the RLDC and the money to the cashier. The second deposit of P500.00 by Ieda was later returned to him.

On March 7, 1990, the chief telephone operator issued a memorandum [3] to petitioner and Loleng directing the two to explain the February 15 incident. Petitioner and Loleng thereafter submitted their written explanation.[4]

On March 20, 1990, a written report[5] was submitted by the chief telephone operator, with the recommendation that the offenses committed by the operators concerned covered violations of the Offenses Subject to Disciplinary Actions (OSDA): (1) OSDA 2.01:forging, falsifying official document(s), and (2) OSDA 1.11: culpable carelessness - negligence or failure to follow specific instruction(s) or established procedure(s).

On March 23, 1990, petitioner was served a notice of dismissal [6] effective April 1, 1990. Petitioner refused to sign the notice and wrote therein "under protest."

Meanwhile, a criminal case[7] for Falsification of Private Documents and Qualified Theft was filed before the Office of the City Prosecutor of Manila by private respondent against Loleng and petitioner. However, the resolution recommending the filing of a case for estafa was reversed by 2nd Asst. City Prosecutor Virgilio M. Patag.

On October 2, 1990, petitioner filed a complaint for illegal dismissal against private respondent before the Labor Arbiter. The complaint was later amended to include a claim for unpaid wages, unpaid vacation leave conversion and moral damages.

Position papers were filed by the parties. Thereafter, the motion to set the case for hearing filed by private respondent was granted by the Labor Arbiter and trial on the merits ensued.

In his decision[8] dated May 29, 1992, Labor Arbiter Oswald Lorenzo found that the petitioner was illegally dismissed. However, in the decision, the Labor Arbiter stated that:

Preliminarily, we hereby state that on the face of the instant complaint, it is one that revolves on the matter of the implementation and interpretation of existing company policies, which per the last par. of Art. 217 of the Labor Code, as amended, is one within the jurisdictional ambit of the grievance procedure under the CBA and thereafter, if unresolved, one proper for voluntary arbitration. This observation is re-entrenched by the fact, that complainant claims she is a member of NUWHRAIN with an existing CBA with respondent hotel.

On this score alone, this case should have been dismissed outright.[9]

Despite the aforequoted preliminary statement, the Labor Arbiter still assumed jurisdiction since Labor Arbiters under Article 217 of the same Labor Code, are conferred original and exclusive jurisdiction of all termination case(sic.). The dispositive portion of the decision states that:

"WHEREFORE, premises considered, judgment is hereby rendered as follows:

Declaring complainant's dismissal by respondent hotel as illegally effected;

Ordering respondent to immediately reinstate complainant to her previous position without loss of seniority rights;

Ordering further respondent to pay complainant the full backwages due her, which is computed as follows:

3/23/90 - 10/31/90 = 7.26/mos.

P2,540 x 7.26/mos. P18,440.40

11/1/90 - 1/7/91 = 2.23/mos.

P3,224.16 x 2.23/mos. 7,189.87

1/8/91 - 4/29/92 = 15.7/mos.

P3,589.16 x 15.7/mos. 56,349.89

P81,980.08

Moreover, respondent is ordered to pay the 13 th month pay due the complainant in the amount of P6,831.67 including moral and exemplary damages of P15,000.00 and P10,000.00 respectively, as well as attorney's fees equivalent to ten (10) percent of the total award herein in the amount of P11,381.17;

Finally, all other claims are hereby dismissed for lack of merit.

"SO ORDERED."

Private respondent appealed the decision to the respondent commission on the ground inter alia that the Labor Arbiter erred in assuming jurisdiction over the illegal dismissal case after finding that the case falls within the jurisdictional ambit of the grievance procedure under the CBA, and if unresolved, proper for voluntary arbitration.[10] An Opposition[11] was filed by petitioner.

In the assailed Resolution[12] dated June 3, 1994, respondent NLRC dismissed the illegal dismissal case for lack of jurisdiction of the Labor Arbiter because the same should have instead been subjected to voluntary arbitration.

Petitioners motion for reconsideration[13] was denied by respondent NLRC for lack of merit.

In this petition for certiorari, petitioner ascribes to respondent NLRC grave abuse of discretion in -

Ruling that the Labor Arbiter was without jurisdiction over the illegal dismissal case;

Not ruling that private respondent is estopped by laches from questioning the jurisdiction of the Labor Arbiter over the illegal dismissal case;

Reversing the decision of the Labor Arbiter based on a technicality notwithstanding the merits of the case.

Petitioner contends that Article 217(a)(2) and (c) relied upon by respondent NLRC in divesting the labor arbiter of jurisdiction overthe illegal dismissal

case, should be read in conjunction with Article 261[14] of the Labor Code. It is the view of petitioner that termination cases arising from the interpretation or enforcement of company personnel policies pertaining to violations of Offenses Subject to Disciplinary Actions (OSDA), are under the jurisdiction of the voluntary arbitrator only if these are unresolved in the plant-level grievance machinery. Petitioner insists that her termination is not an unresolved grievance as there has been no grievance meeting between the NUWHRAIN union and the management. The reason for this, petitioner adds, is that it has been a company practice that termination cases are not anymore referred to the grievance machinery but directly to the labor arbiter.

In its comment, private respondent argues that the Labor Arbiter should have dismissed the illegal dismissal case outright after finding that it is within the jurisdictional ambit of the grievance procedure. Moreover, private respondent states that the issue of jurisdiction may be raised at any time and at any stage of the proceedings even on appeal, and is not in estoppel by laches as contended by the petitioner.

For its part, public respondent, through the Office of the Solicitor General, cited the ruling of this Court in Sanyo Philippines Workers Union-PSSLU vs. Caizares [15] in dismissing the case for lack of jurisdiction of the Labor Arbiter.

The legal issue in this case is whether or not the Labor Arbiter has jurisdiction over the illegal dismissal case.

The respondent Commission, in holding that the Labor Arbiter lacks jurisdiction to hear the illegal dismissal case, cited as basis therefor Article 217 of the Labor Code, as amended by Republic Act No. 6715. It said:

While it is conceded that under Article 217(a), Labor Arbiters shall have original and exclusive jurisdiction over cases involving termination disputes, the Supreme Court, in a fairly recent case ruled:

The procedure introduced in RA 6715 of referring certain grievances originally and exclusively to the grievance machinery, and when not settled at this level, to a panel of voluntary arbitrators outlined in CBAs does not only include grievances arising from the interpretation or implementation of the CBA but applies as well to those arising from the implementation of company personnel policies. No other body shall take cognizance of these cases. x x x. (Sanyo vs. Caizares, 211 SCRA 361, 372)[16]

We find that the respondent Commission has erroneously interpreted the aforequoted portion of our ruling in the case of Sanyo, as divesting the Labor Arbiter of jurisdiction in a termination dispute.

Article 217 of the Labor Code gives us the clue as to the jurisdiction of the Labor Arbiter, to wit:

Article 217. Jurisdiction of Labor Arbiters and the Commission. a) Except as otherwise provided under this Code the Labor Arbiters shall have original and exclusive jurisdiction to hear and decide within thirty (30) calendar days after

the submission of the case by the parties for decision without extension even in the absence of stenographic notes, the following cases involving all workers, whether agricultural or non-agricultural:

1.Unfair labor practice cases;

2. Termination disputes;

3. If accompanied with a claim for reinstatement, those cases that workers may file involving wages, rates of pay, hours of work and other terms and conditions of employment;

4. Claims for actual, moral, exemplary and other forms of damages arising from the employer-employee relations;

5. Cases arising from any violation of Article 264 of this Code, including questions involving the legality of strikes and lockouts;

6. Except claims for Employees Compensation, Social Security, Medicare and maternity benefits, all other claims, arising from employer-employee relations, including those of persons in domestic or household service, involving an amount exceeding five thousand pesos (P5,000.00) regardless of whether accompanied with a claim for reinstatement.

b) The Commission shall have exclusive appellate jurisdiction over all cases decided by Labor Arbiters.

c) Cases arising from the interpretation or implementation of collective bargaining agreements and those arising from the interpretation or enforcement of company personnel policies shall be disposed of by the Labor Arbiter by referring the same to the grievance machinery and voluntary arbitration as may be provided in said agreements.

As can be seen from the aforequoted Article, termination cases fall under the original and exclusive jurisdiction of the Labor Arbiter.It should be noted, however, that in the opening paragraph there appears the phrase: Except as otherwise provided under this Code x x x. It is paragraph (c) of the same Article which respondent Commission has erroneously interpreted as giving the voluntary arbitrator jurisdiction over the illegal dismissal case.

However, Article 217 (c) should be read in conjunction with Article 261 of the Labor Code which grants to voluntary arbitrators original and exclusive jurisdiction to hear and decide all unresolved grievances arising from the interpretation or implementation of the collective bargaining agreement and those arising from the interpretation or

enforcement of company personnel policies. Note the phrase unresolved grievances. In the case at bar, the termination of petitioner is not an unresolved grievance.

The stance of the Solicitor General in the Sanyo case is totally the reverse of its posture in the case at bar. In Sanyo, the Solicitor General was of the view that a distinction should be made between a case involving interpretation or implementation of Collective Bargaining Agreement or interpretation or enforcement of company personnel policies, on the one hand and a case involving termination, on the other hand. It argued that the dismissal of the private respondents does not involve an interpretation or implementation of a Collective Bargaining Agreement or interpretation or enforcement of company personnel policies but involves termination. The Solicitor General further said that where the dispute is just in the interpretation, implementation or enforcement stage, it may be referred to the grievance machinery set up in the Collective Bargaining Agreement or by voluntary arbitration. Where there was already actual termination, i.e., violation of rights, it is already cognizable by the Labor Arbiter. [17] We fully agree with the theory of the Solicitor General in the Sanyo case, which is radically apposite to its position in this case.

Moreover, the dismissal of petitioner does not fall within the phrase grievances arising from the interpretation or implementation of collective bargaining agreement and those arising from the interpretation or enforcement of company personnel policies, the jurisdiction of which pertains to the grievance machinery or thereafter, to a voluntary arbitrator or panel of voluntary arbitrators. It is to be stressed that under Article 260 of the Labor Code, which explains the function of the grievance machinery and voluntary arbitrator, (T)he parties to a Collective Bargaining Agreement shall include therein provisions that will ensure the mutual observance of its terms and conditions.They shall establish a machinery for the adjustment and resolution of grievances arising from the interpretation or implementation of their Collective Bargaining Agreement and those arising from the interpretation or enforcement of company personnel policies. Article 260 further provides that the parties to a CBA shall name or designate their respective representative to the grievance machinery and if the grievance is unsettled in that level, it shall automatically be referred to the voluntary arbitrators designated in advance by the parties to a CBA of the union and the company. It can thus be deduced that only disputes involving the union and the company shall be referred to the grievance machinery or voluntary arbitrators.[18]

In the case at bar, the union does not come into the picture, not having objected or voiced any dissent to the dismissal of the herein petitioner. The reason for this, according to petitioner is that the practice in said Hotel in cases of termination is that the latter cases are not referred anymore to the grievance committee; and that the terminated employee who wishes to question the legality of his termination usually goes to the Labor Arbiter for arbitration, whether the termination arose from the interpretation or enforcement of the company personnel policies or otherwise. [19]

As we ruled in Sanyo, Since there has been an actual termination, the matter falls within the jurisdiction of the Labor Arbiter. The aforequoted doctrine is applicable foursquare in petitioners case. The dismissal of the petitioner does not call for the

interpretation or enforcement of company personnel policies but is a termination dispute which comes under the jurisdiction of the Labor Arbiter.

It should be explained that company personnel policies are guiding principles stated in broad, long-range terms that express the philosophy or beliefs of an organizations top authority regarding personnel matters. They deal with matters affecting efficiency and well-being of employees and include, among others, the procedure in the administration of wages, benefits, promotions, transfer and other personnel movements which are usually not spelled out in the collective agreement. The usual source of grievances, however, are the rules and regulations governing disciplinary actions. [20]

The case of Pantranco North Express, Inc. vs. NLRC [21] sheds further light on the issue of jurisdiction where the Court cited theSanyo case and quoted the decision of therein Labor Arbiter Olairez in this manner:

In our honest opinion we have jurisdiction over the complaint on the following grounds:

First, this is a complaint of illegal dismissal of which original and exclusive jurisdiction under Article 217 has been conferred to the Labor Arbiters. The interpretation of the CBA or enforcement of the company policy is only corollary to the complaint of illegal dismissal.Otherwise, an employee who was on AWOL, or who committed offenses contrary to the personnel policies(sic) can no longer file a case of illegal dismissal because the discharge is premised on the interpretation or enforcement of the company policies(sic).

Second. Respondent voluntarily submitted the case to the jurisdiction of this labor tribunal. It adduced arguments to the legality of its act, whether such act may be retirement and/or dismissal, and prayed for reliefs on the merits of the case. A litigant cannot pray for reliefs on the merits and at the same time attacks(sic) the jurisdiction of the tribunal. A person cannot have ones cake and eat it too. x x x.

As to the second ground, petitioner correctly points out that respondent NLRC should have ruled that private respondent is estopped by laches in questioning the jurisdiction of the Labor Arbiter.

Clearly, estoppel lies. The issue of jurisdiction was mooted by herein private respondents active participation in the proceedings below. In Marquez vs. Secretary of Labor,[22] the Court said:

x x x. The active participation of the party against whom the action was brought, coupled with his failure to object to the jurisdiction of the court or quasi-judicial body where the action is pending, is tantamount to an invocation

of that jurisdiction and a willingness to abide by the resolution of the case and will bar said party from later on impugning the court or bodys jurisdiction.

In the assailed Resolution,[23] respondent NLRC cited La Naval Drug Corporation vs. Court of Appeals[24] in holding that private respondent is not in estoppel. Thus,

The operation of the principle of estoppel on the question of jurisdiction seemingly depends upon whether the lower court actually had jurisdiction or not. If it had no jurisdiction, but the case was tried and decided upon the theory that it had jurisdiction, the parties are not barred, on appeal, from assailing such jurisdiction, for the same must exist as a matter of law, and may not be conferred by consent of the parties or by estoppel (5 C.J.S., 861-863). However, if the lower court had jurisdiction, and the case was heard and decided upon a given theory, such, for instance, as that the court had no jurisdiction, the party who induced it to adopt such theory will not be permitted, on appeal, to assume an inconsistent position that the lower court had jurisdiction.   Here, the principle of estoppel applies . The rule that jurisdiction is conferred by law, and does not depend upon the will of the parties, has no bearing thereon. (Underscoring ours)

Again, the respondent NLRC has erroneously interpreted our ruling in the La Naval case. Under the said ruling, estoppel lies in this case. Private respondent is estopped from questioning the jurisdiction of the Labor Arbiter before the respondent NLRC having actively participated in the proceedings before the former. At no time before or during the trial on the merits did private respondent assail the jurisdiction of the Labor Arbiter. Private respondent took the cue only from the preliminary statement in the decision of the Labor Arbiter, which was a mere obiter, and raised the issue of jurisdiction before the Commission. It was then too late. Estoppel had set in.

Turning now to the merits of the case, We uphold the ruling of the Labor Arbiter that petitioner was illegally dismissed.

The requisites of a valid dismissal are (1) the dismissal must be for any of the causes expressed in Article 282 of the Labor Code, [25] and (2) the employee must be given an opportunity to be heard and to defend himself. [26] The substantive and procedural laws must be strictly complied with before a worker can be dismissed from his employment because what is at stake is not only the employees position but his livelihood.[27]

Petitioners dismissal was grounded on culpable carelessness, negligence and failure to follow specific instruction(s) or established procedure(s) under OSDA 1.11; and, having forged or falsified official document(s) under OSDA 2.01.

Private respondent blames petitioner for failure to follow established procedure in the hotel on a guests request for long distance calls. Petitioner, however, explained that the usual or established procedures are not followed by the operators and hotel

employees when circumstances warrant. For instance, the RLDC forms and the deposits are brought by the page boy directly to the operators instead of the cashiers if the latter are busy and cannot attend to the same. Furthermore, she avers that the telephone operators are not conscious of the serial numbers in the RLDCs and at times, the used RLDCs are recycled. Even the page boys do not actually check the serial numbers of all RLDCs in one batch, except for the first and the last.

On the charge of taking of the money by petitioner, it is to be noted that the second P500.00 deposit made by the Japanese guest Ieda was later discovered to be inserted in the folder for cancelled calls with deposit and official receipts. Thus, there exists no basis for personal appropriation by the petitioner of the money involved. Another reason is the alleged tampering of RLDC No. 862406. [28] While petitioner and her co-operator Loleng admitted that they indeed altered the date appearing therein from February 15, 1990 to February 13, the same was purposely made to reflect the true date of the transaction without any malice whatsoever on their part.

As pointed out by Labor Arbiter Oswald B. Lorenzo, thus:

The specifics of the grounds relied by respondent hotels dismissal of complainant are those stated in Annex F of the latters POSITION PAPER, which is the Notice of Dismissal, notably:

OSDA 2.01 - Forging, falsifying official document(s)

OSDA 1.11 - Culpable negligence or failure to follow specific instruction(s) or established procedure(s)

On this score, we are persuaded by the complainants arguments that under OSDA 1.11, infractions of this sort is not without qualifications, which is, that the alleged culpable carelessness, negligence or failure to follow instruction(s) or established procedure(s), RESULTING IN LOSS OR DAMAGE TO COMPANY PROPERTY. From the facts obtaining in this case, there is no quantum of proof whatsoever, except the general allegations in respondents POSITION PAPER and other pleadings that loss or damage to company property resulted from the charged infraction. To our mind, this is where labor tribunals should come in and help correct interpretation of company policies which in the enforcement thereof wreaks havoc to the constitutional guarantee of security of tenure. Apparently, the exercise of little flexibility by complainant and co-employees which is predicated on good faith should not be taken against them and more particularly against the complainant herein. In this case, to sustain the generalized charge of respondent hotel under OSDA 1.11 would unduly be sanctioning the imposition of too harsh a penalty - which is dismissal.

In the same tenor, the respondents charge under OSDA 1.11 on the alleged falsification of private document is also with a qualification, in that the alleged act of falsification must have been done IN SUCH A WAY AS TO MISLEAD THE USER(S) THEREOF. Again, based on the facts of the complained act, there appeared no one to have been misled on the change of date from RLDC #862406 FROM 15 TO 13 February 1990.

As a matter of fact, we are in agreement with the jurisprudence cited by VIRGILIO M. PATAG, the 2nd Asst. City Prosecutor of the City of Manila, who exculpated complainant MANEJA from the charges of falsification of private documents and qualified theft under IS No. 90-11083 and marked Annex H of complainants POSITION PAPER, when he ruled that an altercation which makes the document speak the truth cannot be the foundation of a criminal action. As to the charge of qualified theft, we too are of the finding, like the city prosecutor above-mentioned that there was no evidence on the part of MANEJA to have unlawfully taken the P500.00 either from the hotel or from guest IEDA on 13 February 1990 and moreover, we too, find no evidence that complainant MANEJA had the intention to profit thereby nor had misappropriated the P500.00 in question.[29]

Given the factual circumstances of the case, we cannot deduce dishonesty from the act and omission of petitioner. Our norms of social justice demand that we credit employees with the presumption of good faith in the performance of their duties,[30] especially petitioner who has served private respondent since 1985 up to 1990 without any tinge of dishonesty and was even named Model Employee for the month of April, 1989.[31]

Petitioner has been charged with a very serious offense - dishonesty. This can irreparably wreck her life as an employee for no employer will take to its bosom a dishonest employee. Dismissal is the supreme penalty that can be meted to an employee and its imposition cannot be justified where the evidence is ambivalent. [32] It must, therefore, be based on a clear and not on an ambiguous or ambivalent ground. Any ambiguity or ambivalence on the ground relied upon by an employer in terminating the services of an employee denies the latter his full right to contest its legality. Fairness cannot countenance such ambiguity or ambivalence. [33]

An employer can terminate the services of an employee only for valid and just causes which must be supported by clear and convincing evidence. The employer has the burden of proving that the dismissal was indeed for a valid and just cause. [34] Failure to do so results in a finding that the dismissal was unjustified. [35]

Finding that there was no just cause for dismissal of petitioner, we now determine if the rudiments of due process have been duly accorded to her.

Well-settled is the dictum that the twin requirements of notice and hearing constitute the essential elements of due process in the dismissal of employees. It is a cardinal rule in our jurisdiction that the employer must furnish the employee with two written notices before the termination of employment can be effected: (a) the first apprises the employee of the particular acts or omissions for which his dismissal is sought; and, (b)

the second informs the employee of the employers decision to dismiss him. The requirement of a hearing, on the other hand, is complied with as long as there was an opportunity to be heard, and not necessarily that an actual hearing was conducted. [36]

In the case at bar, petitioner and her co-operator Loleng were issued a memorandum on March 7, 1990. On March 11, 1990, they submitted their written explanation thereto. On March 20, 1990, a written report was made with a recommendation that the offenses committed by them were covered by OSDA 1.11 and 2.01. Thereafter, on March 23, 1990, petitioner was served with a notice of dismissal for said violations effective April 1, 1990.

An examination of the record reveals that no hearing was ever conducted by private respondent before petitioner was dismissed.While it may be true that petitioner submitted a written explanation, no hearing was actually conducted before her employment was terminated. She was not accorded the opportunity to fully defend herself.

Consultations or conferences may not be a substitute for the actual holding of a hearing. Every opportunity and assistance must be accorded to the employee by the management to enable him to prepare adequately for his defense, including legal representation.[37]Considering that petitioner denied having allegedly taken the second P500.00 deposit of the Japanese guest which was eventually found; and, having made the alteration of the date on the second RLDC merely to reflect the true date of the transaction, these circumstances should have at least warranted a separate hearing to enable petitioner to fully ventilate her side. Absent such hearing, petitioners right to due process was clearly violated.[38]

It bears stressing that a workers employment is property in the constitutional sense. He cannot be deprived of his work without due process of law. Substantive due process mandates that an employee can only be dismissed based on just or authorized causes.Procedural due process requires further that he can only be dismissed after he has been given an opportunity to be heard. The import of due process necessitates the compliance of these two aspects.

Accordingly, we hold that the labor arbiter did not err in awarding full backwages in view of his finding that petitioner was dismissed without just cause and without due process.

We ruled in the case of Bustamante vs. NLRC[39] that the amount of backwages to be awarded to an illegally dismissed employee must be computed from the time he was dismissed to the time he is actually reinstated, without deducting the earnings he derived elsewhere pending the resolution of the case.

Petitioner is likewise entitled to the thirteenth-month pay. Presidential Decree No. 851, as amended by Memorandum Order No. 28, provides that employees are entitled to the thirteenth-month pay benefit regardless of their designation and irrespective of the method by which their wages are paid.[40]

The award of moral and exemplary damages to petitioner is also warranted where there is lack of due process in effecting the dismissal.

Where the termination of the services of an employee is attended by fraud or bad faith on the part of the employer, as when the latter knowingly made false allegations of a supposed valid cause when none existed, moral and exemplary damages may be awarded in favor of the former.[41]

The anti-social and oppressive abuse of its right to investigate and dismiss its employees constitute a violation of Article 1701 of the New Civil Code which prohibits acts of oppression by either capital or labor against the other, and Article 21 on human relations. The grant of moral damages to the employees by reason of such conduct on the part of the company is sanctioned by Article 2219, No. 10 of the Civil Code, which allows recovery of such damages in actions referred to in Article 21. [42]

The award of attorneys fees amounting to ten percent (10%) of the total award by the labor arbiter is justified under Article 111 of the Labor Code.

WHEREFORE, premises considered, the petition is GRANTED and the assailed resolutions of the respondent National Labor Relations Commission dated June 3, 1994 and October 20, 1995 are hereby REVERSED AND SET ASIDE. The decision dated May 29, 1992 of the Labor Arbiter is therefore REINSTATED.

SO ORDERED.