G.R. No. 140992 March 25, 2004

SAMAHANG MANGGAGAWA SA SULPICIO LINES, INC.–NAFLU, RODOLFO ALINDATO, ROQUE TAN, JESSIE LIM, SUSAN TOPACIO, LYDDA PASCUAL, BERNARDO ALCANTARA, GELACIO DESQUITADO, RODRIGO AVELINO, LEONARDO ANDRADE, DANILO CHUA, AMANDO EUGENIO, CALVIN LOPEZ, ANDRES BASCO, JR., and CIRILO ALON, petitioners,

vs.

SULPICIO LINES, INC., respondent.

D E C I S I O N

SANDOVAL-GUTIERREZ, J.:

A strike is a powerful weapon of the working class. But like a sensitive explosive, it must be handled carefully, lest it blows up in the workers’ own hands.1 Thus, the right to strike has to be pursued within the bounds of law.

For our resolution is the instant petition for review on certiorari under Rule 45 of the 1997 Rules of Civil Procedure, as amended, assailing the Decision2 dated May 28, 1999 and the Resolution3 dated November 25, 1999 rendered by the Court of Appeals in CA-G.R. SP No. 51322, entitled "Samahang Manggagawa sa Sulpicio Lines, Inc. – NAFLU vs. National Labor Relations Commission and Sulpicio Lines, Inc."

The factual antecedents as gleaned from the records are:

On February 5, 1991, Sulpicio Lines, Inc. (herein respondent) and the Samahang Manggagawa sa Sulpicio Lines Inc. – NAFLU (herein petitioner) executed a collective bargaining agreement (CBA) with a term of five (5) years (from October 17, 1990 to October 16, 1995).

After three (3) years or on December 15, 1993, petitioner union and respondent company started their negotiation on the CBA’s economic provisions.4 But this negotiation remained at stalemate.

On March 1, 1994, petitioner filed with the National Conciliation and Mediation Board (NCMB), National Capital Region, a notice of strike due to collective bargaining deadlock, docketed as NCMB-NCR-NS-03-118-94.

For its part, respondent, on March 21, 1994, filed with the Office of the Secretary, Department of Labor and Employment a petition praying that the Labor Secretary assume jurisdiction over the controversy.

On March 23, 1994, former Labor Secretary Nieves R. Confesor issued an Order assuming jurisdiction over the labor dispute pursuant to Article 263 (g) of the Labor Code, as amended, thus:

"WHEREFORE PREMISES CONSIDERED, this Office assumes jurisdiction over the labor dispute at Sulpicio Lines, Inc. pursuant to Article 263 (g) of the Labor Code, as amended.

"Accordingly, any strike or lockout whether actual or intended is hereby enjoined.

"Further, the parties are directed to cease and desist from committing any and all acts that might exacerbate the situation.

"SO ORDERED."

Meanwhile, on May 20, 1994, petitioner filed with the NCMB a second notice of strike alleging that respondent company committed acts5 constituting unfair labor practice amounting to union busting, docketed as NCMB NCR-05-261-94.

Provoked by respondent’s alleged unfair labor practice/s, petitioner union immediately conducted a strike vote. Thus, on May 20, 1994, about 9:30 o’clock in the morning, 167 rank-and-file employees, officers and members of petitioner, did not report for work and instead gathered in front of Pier 12, North Harbor at Manila.

As a remedial measure, former Labor Secretary Confesor issued an Order dated May 20, 1994 directing the striking employees to return to work; and certifying the labor dispute to the National Labor Relations Commission (NLRC) for compulsory arbitration. This certified labor dispute was docketed as NLRC Case No. CC-0083-94.

Meanwhile, respondent company filed with the NLRC a complaint for "illegal strike/clearance for termination," docketed as NLRC NCR Case No. 00-05-04705-94.

On September 29, 1995, the NLRC issued a Resolution6 declaring the strike of petitioner’s officers and members illegal, with notice to respondent of the option to terminate their (petitioner’s officers) employment. In the same Resolution, the NLRC dismissed petitioner’s complaint against respondent, thus:

"WHEREFORE, premises considered, after a careful and judicious consideration of the facts, arguments and evidence thus adduced, it is the considered opinion of thie Commission that the union (Samahang Manggagawa sa Sulpicio Lines, Inc.) had clearly engaged in an illegal strike on May 20, 1994, when its officers and members actively participated in a well concerted refusal, stoppage and cessation to render work at Sulpicio Lines, Inc.. In clear violation not only of the procedural requirements of a valid strike, but worse, in clear and blatant contravention of the assumption order of the Secretary of Labor and Employment. Consequently, the following union officers named in the complaint, to wit:

1) Allan F. Aguhar

9) Rodrigo Avelino

2) Rodolfo Alindato

10) Leonardo Andrade

3) Roque Tan

11) Danilo Chua

4) Jessie Lim

12) Amando Eugenio

5) Susan Topacio

13) Calvin Lopez

6) Lydda Pascual

14) Andres Rasco, Jr.

7) Bernardo Alcantara

15) Cirilo Alon

8) Gelacio Dequitado

are declared to have lost their employment status with the company, and the latter may now, if it so desires, terminate their employment with it. The union’s complaint against the company is hereby DISMISSED for lack of merit.

"SO ORDERED."

Petitioner filed a motion for reconsideration but was denied by the NLRC in a Resolution7 dated January 15, 1996.

On March 19, 1996, petitioner filed with this Court a petition for certiorari assailing the NLRC Resolutions. Pursuant to our ruling in St. Martin’s Funeral Home vs. NLRC,8 we referred the petition to the Court of Appeals for its appropriate action and disposition.

On May 28, 1999, the Court of Appeals rendered a Decision affirming the NLRC Resolutions. The Appellate Court held (1) that the NLRC has jurisdiction to resolve the issue of legality of the strike; (2) that the May 20, 1994 temporary work stoppage by the officers and members of petitioner amounted to an illegal strike; (3) that even assuming that respondent committed unfair labor practice/s, still, the strike is illegal because it failed to comply with the mandatory procedural requirements of a valid strike under Article 263 (c) and (f) of the Labor Code, as amended; and (4) that the dismissal of petitioner’s officers who knowingly participated in an illegal strike is in accordance with Article 264 (a) of the Labor Code, as amended.

On October 20, 1995, petitioner filed a motion for reconsideration but was denied by the Court of Appeals in a Resolution dated November 25, 1999.

Hence, this petition for review on certiorari. Petitioner alleged that the Court of Appeals seriously erred (1) in holding that the one-day work stoppage of petitioner’s officers and members is an illegal strike; (2) in sustaining the dismissal from the service of its officers; and (3) in ruling that the NLRC has jurisdiction over a petition to declare the strike illegal.

The basic issue for our determination is whether the strike staged by petitioner’s officers and members is illegal. Articles 263 and 264 of the Labor Code, as amended, provide:

"ART. 263. STRIKES, PICKETING AND LOCKOUTS.

x x x

(c) In cases of bargaining deadlocks, the duly certified or recognized bargaining agent may file a notice of strike x x x with the Ministry (now Department) at least 30 days before the intended date thereof. In cases of unfair labor practice, the period of notice shall be 15 days and in the absence of a duly certified or recognized bargaining agent, the notice of strike may be filed by any legitimate labor organization in behalf of its members. However, in case of dismissal from employment of union officers duly elected in accordance with the union constitution and by-laws, which may constitute union busting where the existence of the union is threatened, the 15-day cooling-off period shall not apply and the union may take action immediately.

x x x

(f) A decision to declare a strike must be approved by a majority of the total union membership in the bargaining unit concerned, obtained by secret ballot in meetings or referenda called for that purpose. x x x. The decision shall be valid for the duration of the dispute based on substantially the same grounds considered when the strike or lockout vote was taken. The Ministry (now Department) may at its own initiative or upon the request of any affected party, supervise the conduct of the secret balloting. In every case, the union x x x shall furnish the Ministry (now Department) the results of the voting at least seven days before the intended strike or lockout, subject to the cooling-off period herein provided.

x x x.

ART. 264. PROHIBITED ACTIVITIES.

(a) No labor organization or employer shall declare a strike or lockout without first having bargained collectively in accordance with Title VII of this Book or without first having filed the notice required in the preceding article or without the necessary strike or lockout vote first having been obtained and reported to the Ministry (now Department).

x x x."

Following are the Implementing Guidelines of the above provisions issued by the Department of Labor and Employment:

1. A strike shall be filed with the Department of Labor and Employment at least 15 days if the issues raised are unfair labor practice or at least 30 days if the issue involved bargaining deadlock. However, in case of dismissal from employment of union officers duly elected in accordance with the union constitution and by-laws, which may constitute union busting where the existence of the union is threatened, the 15-day cooling-off period shall not apply and the union may take action immediately;

2. The strike shall be supported by a majority vote of the members of the union obtained by secret ballot in a meeting called for the purpose; and

3. A strike vote shall be reported to the Department of Labor and Employment at least seven (7) days before the intended strike.

There is no showing that the petitioner union observed the 7-day strike ban; and that the results of the strike vote were submitted by petitioners to the Department of Labor and Employment at least seven (7) days before the strike.

We thus hold that for failing to comply with the mandatory requirements of Article 263 (c) and (f) of the Labor Code, the strike mounted by petitioner union on May 20, 1994 is illegal.

In Gold City Integrated Port Service, Inc. vs. NLRC,9 we stressed that "the language of the law leaves no room for doubt that the cooling-off period and the seven-day strike ban after the strike-vote report were intended to be mandatory."

But petitioner insists that the strike can still be declared legal for it was done in good faith, being in response to what its officers and members honestly perceived as unfair labor practice or union busting committed by respondent.

Petitioner’s accusation of union busting is bereft of any proof. We scanned the records very carefully and failed to discern any evidence to sustain such charge.

In Tiu vs. NLRC,10 we held:

"x x x. It is the union, therefore, who had the burden of proof to present substantial evidence to support its allegations (of unfair labor practices committed by management).

"x x x.

"x x x, but in the case at bar the facts and the evidence did not establish even at least a rational basis why the union would wield a strike based on alleged unfair labor practices it did not even bother to substantiate during the conciliation proceedings. It is not enough that the union believed that the employer committed acts of unfair labor practice when the circumstances clearly negate even a prima facie showing to warrant such a belief."

We explained in National Federation of Labor vs. NLRC11 that "with the enactment of Republic Act No. 6715 which took effect on March 21, 1989, the rule now is that such requirements as the filing of a notice of strike, strike vote, and notice given to the Department of Labor are mandatory in nature. Thus, even if the union acted in good faith in the belief that the company was committing an unfair labor practice, if no notice of strike and a strike vote were conducted, the said strike is illegal."

In a desperate attempt to justify its position, petitioner insists that what transpired on May 20, 1994 was not a strike but merely a "one-day work absence"12 or a "simple act of absenteeism".13

We are not convinced. A strike, as defined in Article 212 (o) of the Labor Code, as amended, means "any temporary stoppage of work by the concerted action of employees as a result of an industrial or labor

dispute." The term "strike" shall comprise not only concerted work stoppages, but also slowdowns, mass leaves, sitdowns, attempts to damage, destroy or sabotage plant equipment and facilities, and similar activities.14

The basic elements of a strike are present in the case at bar. First, petitioner’s officers and members numbering 167, in a concerted manner, did not report for work on May 20, 1994; second, they gathered in front of respondent’s office at Pier 12, North Harbor at Manila to participate in a strike voting conducted by petitioner; and third, such union activity was an aftermath of petitioner’s second notice of strike by reason of respondent’s unfair labor practice/s. Clearly, what transpired then was a strike because the cessation of work by petitioner’s concerted action resulted from a labor dispute.

Invoking compassion, petitioner pleads that its officers who participated in the one-day strike should not be dismissed from the service, considering that respondent’s business activities were not interrupted, much less paralyzed. While we sympathize with their plight, however, we must take care that in the contest between labor and capital, the results achieved are fair and in conformity with the law.15

Pertinent is Article 264 (a) of the same Code, thus:

"ART. 264. PROHIBITED ACTIVITIES.

"x x x. Any union officer who knowingly participates in an illegal strike and any worker or union officer who knowingly participates in the commission of illegal acts during a strike may be declared to have lost his employment status: Provided, That mere participation of a worker in a lawful strike shall not constitute sufficient ground for termination of his employment, even if a replacement had been hired by the employer during such lawful strike.

x x x."

It is worth reiterating that the strike is illegal for failure of petitioner to submit the strike vote to the Department of Labor and Employment at least seven (7) days prior thereto. Also, petitioner failed to prove that respondent company committed any unfair labor practice. Amid this background, the participation of the union officers in an illegal strike forfeits their employment status.

In Telefunken Semiconductors Employees Union-FFW vs. Secretary of Labor and Employment,16 we explained –

"The effects of such illegal strikes, outlined in Article 265 (now Article 264) of the Labor Code, make a distinction between workers and union officers who participate therein.

"A union officer who knowingly participates in an illegal strike and any worker or union officer who knowingly participates in the commission of illegal acts during a strike may be declared to have lost their employment status. An ordinary striking worker cannot be terminated for mere participation in an illegal strike. There must be proof that he committed illegal acts during a strike. A union officer, on the other hand, may be terminated from work when he knowingly participates in an illegal strike, and like other workers, when he commits an illegal act during a strike."

Moreover, petitioner maintains that the Labor Arbiter, not the NLRC, should have taken cognizance of the case at bar. We do not agree.

In International Pharmaceuticals, Inc. v. Secretary of Labor and Employment,17 we held:

‘x x x [T]he Secretary was explicitly granted by Article 263 (g) of the Labor Code the authority to assume jurisdiction over a labor dispute causing or likely to cause a strike or lockout in an industry indispensable to the national interest, and decide the same accordingly. Necessarily, this authority to assume jurisdiction over the said labor dispute must include and extend to all questions and controversies arising therefrom, including cases over which the Labor Arbiter has exclusive jurisdiction’ (underscoring supplied).

"In the same manner, when the Secretary of Labor and Employment certifies the labor dispute to the NLRC for compulsory arbitration the latter is concomitantly empowered to resolve all questions and controversies arising therefrom including cases otherwise belonging originally and exclusively to the Labor Arbiter."

WHEREFORE, the petition is DENIED. The Decision and Resolution of the Court of Appeals dated May 28, 1999 and November 25, 1999 are hereby AFFIRMED.

SO ORDERED.

[G.R. No. 145496. February 24, 2004]

STAMFORD MARKETING CORP., GSP MANUFACTURING CORP., GIORGIO ANTONIO MARKETING CORP., CLEMENTINE MARKETING CORP., ULTIMATE CONCEPTS PHILIPPINES, INC., and ROSARIO G. APACIBLE, petitioners, vs. JOSEPHINE JULIAN, LEONOR AMBROSIO, MARILYN AQUINO, PURITA BARRO, ROSARIO BASADA, HERMINIA BERGUELLES, ERLINDA CANARIA, SALVACION CIRUELOS, MARITESS BALISARIO, JULIETA DOLONTAP, JOSEFINA DOMINGO, GLORIA FLORENDO, AMELITA GRANDE, SIMONA MALUNES, CORAZON MARASIGAN, SUSANA OBNAMIA, LUCY PEREZ, GINALYN PIDOY, CAROLINA REYNOSO, LETICIA SARMIENTO, ARCELY VILLEZA, MARIA SANCHO LABIT, IMELDA RIVERA, ROWENA ALVARADO, VIOLETA ARRIOLA, VIRGINIA DE VERA, GIRLIE DISCAYA, ADELAIDA LOMOD, MARILOU RABANAL, JOCELYN RUFILA, ELENA SUEDE, JACINTA TEJADA, MELBA TOLOSA, LEZILDA CARANTO, JECINA BURABOD, LUCITA CASERO, MONICA CRUZ, GLENDA MIRANDA, YOLANDA PANCHO, MYRNA RAGASA, FILOMENA MORALES, FELIPA VALENCIA, CORAZON VIRTUZ, MARICEL BOLANGA, SONIA ANTILLA, LEONITA BINAL, GLORIA LARIOSA, LIZABETH LUANGCO and JULIETA LEANO, respondents.

D E C I S I O N

QUISUMBING, J.:

For review on certiorari is the Court of Appeals’ Decision,[1] dated April 26, 2000, in CA-G.R. SP No. 53169, as well as its Resolution,[2] dated October 11, 2000, denying the petitioners’ Motion for Reconsideration. The Court of Appeals modified the Resolution,[3] dated August 27, 1998, of the National Labor Relations Commission (NLRC)-First Division which, in turn, dismissed the petitioners’ appeal from the decision of Labor Arbiter Ramon Valentin C. Reyes in three (3) consolidated cases, namely:

(1) Josephine Julian, et al. vs. Stamford Marketing Corp. (NLRC NCR Case No. 00-11-08124-94);

(2) Philippine Agricultural, Commercial and Industrial Workers Union, et al. vs. GSP Manufacturing Corp., et al. (NLRC NCR Case No. 00-03-02114-95); and

(3) Lucita Casero, et al. vs. GSP Manufacturing Corp., et al. (NLRC NCR Case No. 00-01-10437-95).

The instant controversy stemmed from a letter sent by Zoilo V. De La Cruz, Jr., president of the Philippine Agricultural, Commercial and Industrial Workers’ Union (PACIWU-TUCP), on November 2, 1994, to Rosario A. Apacible, the treasurer and general manager of herein petitioners Stamford Marketing Corporation, GSP Manufacturing Corporation, Giorgio Antonio Marketing Corporation, Clementine Marketing Corporation, and Ultimate Concept Phils., Inc. Said letter advised Apacible that the rank-and-file employees of the aforementioned companies had formed the Apacible Enterprise Employees’ Union-PACIWU-TUCP. The union demanded that management recognize its existence. Shortly thereafter, discord reared its ugly head, and rancor came hard on its wake.

Josephine Julian, et al. vs. Stamford Marketing Corp.

NLRC NCR Case No. 00-11-08124-94

On November 9, 1994, or just a day after Apacible received the letter of PACIWU-TUCP, herein private respondents Josephine Julian, president of the newly organized labor union; Jacinta Tejada, and Jecina Burabod, board member and member of the said union, respectively, were effectively dismissed from employment.

Without further ado, the three dismissed employees filed suit with the Labor Arbiter. In their Complaint, the three dismissed employees alleged that petitioners had not paid them their overtime pay, holiday pay/premiums, rest day premium, 13th month pay for the year 1994, salaries for services actually rendered, and that illegal deduction had been made without their consent from their salaries for a cash bond.

For its part, herein petitioner Stamford alleged that private respondent Julian was a supervising employee at the Patrick’s Boutique at Shoemart (SM) Northmall. In October 1994, when she was four (4) to five (5) months pregnant, the management of SM Northmall asked her to go on maternity leave, pursuant to company policy. Julian was then directed to report at Stamford’s Head Office for reassignment. She was also asked to submit a medical certificate to enable the company to approximate her delivery date. Julian, however, allegedly failed to comply with these directives and instead, ceased to report for work without having given notice. Stamford then allegedly asked Tejada to take over Julian’s position, but the former inexplicably refused to comply with the management directive. Instead, like Julian, she abandoned her work with nary a notice or an explanation.

As to Burabod, petitioner Giorgio Antonio Boutique (Giorgio) averred that she was employed as one of its sales clerks at its SM Northmall branch. When directed to report to the Giorgio branch at Robinson’s Galleria, she defiantly questioned the validity of the directive and refused to comply. Like Julian and Tejada, she then ceased to report for work without giving notice.

Philippine Agricultural, Commercial and

Industrial Workers’ Union, et al. vs. GSP Manufacturing Corp.

NLRC NCR Case No. 00-03-02114-95

On March 17, 1995, PACIWU-TUCP, filed on behalf of fifty (50) employees allegedly illegally dismissed for union membership by the petitioners, a Complaint before the Arbitration Branch of NLRC, Metro Manila. PACIWU-TUCP charged petitioners herein with unfair labor practice. The Complaint alleged that when Apacible received the letter of PACIWU-TUCP, management began to harass the members of the local chapter, a move which culminated in their outright dismissal from employment, without any just or lawful cause. It was a clear case of union-busting, averred PACIWU-TUCP.

GSP Manufacturing Corporation (GSP) denied the union’s averments. It claimed that it had verified with the Bureau of Labor Relations (BLR) whether a labor organization with the name Apacible Enterprises Employees’ Union was duly registered. It was informed that no such labor organization was registered either as a local chapter of PACIWU or of the Trade Union Congress of the Philippines (TUCP). GSP claimed that after unsuccessfully misrepresenting themselves, herein private respondents then started making unjustified demands, abandoned their work, and staged an illegal strike from November 1994 up to the filing of the Complaints. Petitioners then asked the private respondents to lift their picket and return to work, but were only met with a cold refusal.

Lucita Casero, et al. vs. GSP Manufacturing Corp., et al.

NLRC NCR Case No. 00-01-10437-95

This separate case was also filed by the dismissed union members (complainants in NLRC NCR Case No. 00-03-02114-95), against the petitioners herein for payment of their monetary claims. The dismissed employees demanded the payment of (1) salary differentials due to underpayment of wages; (2) unpaid

salaries/wages for work actually rendered; (3) 13th month pay for 1994; (4) cash equivalent of the service incentive leave; and (5) illegal deductions from their salaries for cash bonds.

Petitioner corporations, however, maintained that they have been paying complainants the wages/salaries mandated by law and that the complaint should be dismissed in view of the execution of quitclaims and waivers by the private respondents.

The Labor Arbiter ordered the three cases consolidated as the issues were interrelated and the respondent corporations were under one management.

After due proceedings, Labor Arbiter Ramon Valentin C. Reyes rendered a decision, the decretal portion of which reads as follows:

WHEREFORE, premises all considered, judgment is hereby rendered in the respective cases as follows:

A. NLRC NCR CASE NO. 00-11-08124-94

1. Holding the respondent guilty of unfair labor practice, and declaring complainants’ dismissals illegal;

2. Ordering respondent to reinstate complainants to their former positions without loss of seniority rights and other benefits;

3. Ordering the respondent to pay complainants their backwages from the date of their termination up to the date of this decision;

4. Ordering the respondent to pay complainants their unpaid salaries, overtime pay, holiday and rest day premium, unpaid 13th month pay and reimbursement of the cash deposit deducted by the respondent from the salaries of complainants.

B. NLRC NCR CASE NO. 00-03-02114-95

1. Declaring the strike conducted by complainants to be illegal;

2. Declaring the officers of the union to have lost their employment status, and thus terminating their employment with respondent companies;

3. Ordering the reinstatement of the complainants who are only members of the union to their former positions with respondent companies, without backwages, except individual complainants Cristeta De Luna, Luzviminda Recones, Eden Revilla, and Jinky Dellosa.

C. NLRC NCR CASE NO. 00-01-10431[4]-95

1. Ordering respondents to pay individual complainants:

a. salary differentials resulting from underpayment of wages

b. unpaid salaries/wages for work actually rendered;

c. 13th month pay for the year 1994;

d. cash equivalent of the service incentive leave;

e. illegal deductions in the form of cash deposits

all in accordance with the computation submitted by the individual complainants.

2. Dismissing the complaint with regard to complainants Cristeta De Luna, Luzviminda Recones, Eden Revilla, and Jinky Dellosa.

All other claims are dismissed for lack of merit.

The Research and Information Division, this Commission, is hereby directed to effect the necessary computation which shall form part of this Decision.

SO ORDERED.[5]

Labor Arbiter Reyes ruled the reassignment and transfer of complainants in NLRC NCR Case No. 00-11-08124-94 as unfair labor practice, it being management interference in the complainants’ formation and membership of union. He held that the protested reassignments and transfers were highly suspicious, having been made right after management was informed about the formation of the union. Such timing could not have been pure coincidence. The Labor Arbiter also found that petitioners herein failed to substantiate their claim that private respondents had abandoned their employment. He pointed out that the complainants’ filing of a case immediately after their alleged dismissal militated against any claim of abandonment. Moreover, petitioners did not furnish complainants with written notices of dismissal. As to the unpaid wages and other monetary benefits claimed by private respondents herein, the Labor Arbiter ruled that as petitioners herein did not present proof of their payment, there is presumption of non-payment. Finally, Labor Arbiter Reyes found the cash deposit of P2,000.00 unauthorized and illegal, without any showing that the same was necessary and recognized in the business.

In NLRC NCR Case No. 00-03-02114-95, it was duly established that the employees’ union was not registered with the Bureau of Labor Relations. Hence, private respondents had engaged in an illegal strike since the right to strike maybe availed of only by a legitimate labor organization. Labor Arbiter Reyes upheld the dismissal of the union officers for leading and participating in an illegal strike, but ruled the dismissal of the union members to be improper since they acted in good faith in the belief that their actions were within the bounds of law.

In NLRC NCR Case No. 00-01-10437-95, the Labor Arbiter found petitioners liable for salary differentials and other monetary claims for petitioners’ failure to sufficiently prove that it had paid the same to complainants as required by law. He likewise ordered the return of the cash deposits to complainants, citing the same reasons as in NLRC NCR Case No. 00-11-08124-94.

Petitioners herein seasonably appealed the decision of Labor Arbiter Reyes. Subsequently, the NLRC affirmed the decision in NLRC NCR Case Nos. 00-11-08124-94 and 00-01-10437-95. However, the NLRC set aside the judgment with respect to NLRC NCR Case No. 00-03-02114-95 and ordered the remand of the case for further proceedings, in view of the various factual issues involved. The NLRC ruling reads:

WHEREFORE, finding the appeal unmeritorious, the same is hereby DISMISSED.

ACCORDINGLY, we hereby set aside the ruling in NLRC NCR CASE NO. 00-03-02114-95 as we order the same remanded for further proceedings in view of the nature of the issues involved being purely factual in character. The awards in NLRC NCR CASE NO. 00-11-08-08124-94 and NLRC NCR CASE NO. 00-01-10437-95 are hereby AFFIRMED.

SO ORDERED.[6]

Meanwhile, on May 14, 1996, petitioners herein filed a Petition to Declare the Strike Illegal against their striking employees, docketed as NLRC NCR Case No. 05-03064-96 and raffled off to Labor Arbiter Arthur L. Amansec.

On September 2, 1998, Labor Arbiter Amansec decided NLRC NCR Case No. 05-03064-96, as follows:

WHEREFORE, judgment is hereby made finding the strike conducted by the respondents from December 1, 1994 up to May 14, 1996 illegal and concomitantly, ordering respondents who are established to have knowingly participated to have committed an illegal act to have lost their employment status.

Other claims for lack of merit are ordered DISMISSED.

SO ORDERED.[7]

In declaring the strike illegal, Labor Arbiter Amansec noted that: (1) no prior notice to strike had been filed; (2) no strike vote had been taken among the union members; and (3) the issue involved was non-strikeable, i.e., a demand for salary increases.

Petitioners then moved for reconsideration of the NLRC ruling, citing the ruling in NLRC NCR Case No. 05-03064-96 to support their position that respondents herein had conducted an illegal strike and were liable for unlawful acts.

On March 12, 1999, the NLRC resolved to partly grant the Motion for Reconsideration, thus:

WHEREFORE, prescinding from the foregoing premises, the Motion for Reconsideration is partly given due course, in that the issues raised in NLRC NCR CASE No. 00-03-02114-95 is hereby declared to have been rendered academic.

The rest of the dispositions in the questioned resolution remains.

SO ORDERED.[8]

Unwilling to let the matter rest there, petitioners then filed a special civil action for certiorari with the Court of Appeals, docketed as CA-G.R. SP No. 53169. The Court of Appeals considered the following issues in resolving the petition, to wit: (a) the validity of the respondents’ dismissal and entitlement to backwages, (b) the validity of the Release, waiver and quitclaim executed by some of the respondents, and (c) the validity of the claims for non-payment of salaries, overtime pay, holiday pay, premium pay, etc.

On April 26, 2000, the appellate court disposed of CA-G.R. SP No. 53169 as follows:

WHEREFORE, premises studiedly considered, the Petition is partly given due course as the 12 March 1999 Resolution of the NLRC is hereby modified as follows:

1. In lieu of reinstatement, private respondents Josephine Julian, Jacinta Tejada, and the rest of the officers of the Union shall be given separation pay at the rate of one month pay for every year of service, with a fraction of at least six months of service considered as one year, computed from the time they were first employed until December 10, 1994;

2. Ordering petitioner corporations to reinstate, without loss of seniority, Jacina Burabod and the rest of the Union members; plus payment of backwages;

The rest of the dispositions in the two (2) challenged resolutions remains.

SO ORDERED.[9]

The appellate court brushed aside petitioners’ theory that the illegality of strike makes the respondents’ dismissal legal. It stressed that while the strike was illegal, marked as it was with violence and for non-compliance with the requirements of the Labor Code, nonetheless, Julian, Tejada, and Burabod (complainants in NLRC NCR Case No. 00-11-08124-94) were dismissed prior to the staging of the strike. Said dismissal constitutes unfair labor practice. Moreover, said dismissal was done without valid cause and due process. Thus, the complainants in NLRC NCR Case No. 00-11-08124-94 are entitled to reinstatement and backwages, although separation pay may be given in lieu of reinstatement due to strained relations with petitioners. The appellate court also ruled that the quitclaims relied upon by petitioners herein are void, having been executed under duress. Finally, the Court of Appeals affirmed the finding of the NLRC that petitioners had failed to support their claim of having paid herein respondents their money claims, because belated evidence presented by petitioners is bereft of any probative value.

Petitioners timely moved for reconsideration, but the appellate court denied said motion.

Hence, this petition alleging that the Court of Appeals committed palpable and reversible errorS of law when:

I … IT ORDERED THE RESPONDENTS, WHO ARE UNION MEMBERS, BE REINSTATED AND BE PAID BACKWAGES, DESPITE THE FACT THAT IT CATEGORICALLY HELD THAT UNLAWFUL ACTS ATTENDED THE STAGING OF THE ILLEGAL STRIKE IN CONTRAVENTION OF THE CLEAR MANDATE OF ARTICLE 264(a) OF THE LABOR CODE.

II … IT AWARDED BACKWAGES TO THE RESPONDENTS, WHO ARE UNION MEMBERS, DESPITE THE FACT THAT THE ISSUE OF WHETHER OR NOT THE SAID UNION MEMBERS ARE ENTITTLED TO BACKWAGES HAVE BEEN ANSWERED IN THE NEGATIVE BY THE DECISION DATED 15 APRIL 1996, PROMULGATED BY THE HONORABLE LABOR ARBITER A QUO VALENTIN C. REYES AND SUCH RULING HAD ATTAINED FINALITY.

III … IT AWARDED SEPARATION PAY AND BACKWAGES TO THE RESPONDENTS WHO ARE OFFICERS OF THE UNION, NAMELY: ADELAIDA LUMOD, LUCITA CASERO, MYRNA RAGASA, FELY MORALES, ELEN SUEDE, FELY VALENCIA AND VIOLETA ARRIOLA, DESPITE THE FACT THAT IT WAS HELD IN THE DECISION DATED 15 APRIL 1996 PROMULGATED BY THE HONORABLE LABOR ARBITER A QUO VALENTIN C. REYES THAT THE AFORENAMED UNION OFFICERS HAVE LOST THEIR EMPLOYMENT STATUS BY STAGING AN ILLEGAL STRIKE AND SUCH RULING HAD ATTAINED FINALITY.

IV … IT HELD THAT RESPONDENTS JULIAN, TEJADA AND BURABOD WERE ILLEGALLY DISMISSED.

V … IT FAILED TO UPHOLD THE VALIDITY OF THE RELEASE, WAIVER AND QUITCLAIM EXECUTED BY THE RESPONDENTS CONCERNED.

VI … IT REFUSED TO GIVE PROBATIVE VALUE ON THE VOLUMINOUS DOCUMENTARY EVIDENCE SUBMITTED BY HEREIN PETITIONERS.[10]

In our view, considering the assigned errors, the following are the relevant issues for our resolution:

1. Whether the respondents union officers and members were validly and legally dismissed from employment considering the illegality of the strike;

2. Whether the respondents union officers and members are entitled to backwages, separation pay and reinstatement, respectively.

On the first issue, petitioners argue that respondents were legally dismissed, pursuant to Article 264[11] of the Labor Code in view of the determination by the Labor Arbiter that the strike conducted by respondents are illegal and that illegal acts attended the mass action. The respondents counter that the determination of the illegality of strike is inconsequential as the conclusion by the appellate court on the illegality of dismissal was based on the petitioners’ non-compliance with the due process requirements on terminating employees, which had nothing to do with the legality of the strike.

Some elaboration on the legality of the strike is needed, though briefly. In ruling the strike illegal, the NLRC observed that:

While the right to strike is specifically granted by law, it is a remedy which can only be availed of by a legitimate labor organization. Absent a showing as to the legitimate status of the labor organization, said strike would have to be considered as illegal.

…

A review of the records of this case does not show that the local union to which complainants belong to has complied with these basic requirements necessary to clothe the union with a legitimate status. In fact, and as respondents claim, there is no record with the BLR that the union complainants belong to have complied with the aforementioned requirements. This Office then has no recourse but to consider the union of complainants as not being a legitimate labor organization. It then follows that the strike conducted by complainants on respondent companies is illegal, as the right to strike is afforded only to a legitimate labor organization.[12]

Indeed, the right to strike, while constitutionally recognized, is not without legal restrictions.[13] The Labor Code regulates the exercise of said right by balancing the interests of labor and management in the light of the overarching public interest. Thus, paragraphs (c) and (f) of Article 263[14] mandate the following procedural steps to be followed before a strike may be staged: filing of notice of strike, taking of strike vote, and reporting of the strike vote result to the Department of Labor and Employment.[15] It

bears stressing that these requirements are mandatory, meaning, non-compliance therewith makes the strike illegal. The evident intention of the law in requiring the strike notice and strike-vote report is to reasonably regulate the right to strike, which is essential to the attainment of legitimate policy objectives embodied in the law.[16]

In the instant case, we find no reason to disagree with the findings of the NLRC that the strike conducted by the respondent union is illegal. First, it has not been shown to the satisfaction of this Court that said union is a legitimate labor organization, entitled under Article 263 (c) to file a notice of strike on behalf of its members. Second, the other requirements under Article 263 (c) and (f) were not complied with by the striking union. On this matter, the record is bare of any showing to the contrary. Hence, what is left for this Court to do is to determine the effects of the illegality of the strike on respondents union officers and members, specifically (a) whether such would justify their dismissal from employment, and (b) whether they ceased to be entitled to the monetary awards and other appropriate reliefs and remedies.

Article 264 of the Labor Code, in providing for the consequences of an illegal strike, makes a distinction between union officers and members who participated thereon. Thus, knowingly participating in an illegal strike is a valid ground for termination from employment of a union officer. The law, however, treats differently mere union members. Mere participation in an illegal strike is not a sufficient ground for termination of the services of the union members. The Labor Code protects an ordinary, rank-and-file union member who participated in such a strike from losing his job, provided that he did not commit an illegal act during the strike.[17] Thus, absent any clear, substantial and convincing proof of illegal acts committed during an illegal strike, an ordinary striking worker or employee may not be terminated from work.[18]

Recourse to the records show that the following respondents were the officers of the union, namely: Josephine C. Julian (President), Adelaida Lomod (Vice President), Lucita Casero (Secretary), Myrna Ragasa (Treasurer), Filomena Morales (Auditor), Elena Suede (Board Member), Jacinta Tejada (Board Member), Felipa Valencia (Board Member) and Violeta Arriola (P.R.O.).[19] Before us, petitioners insist that these employees were legally terminated for their participation in an illegal strike and moreover, Julian and Tejada were validly dismissed for abandoning their jobs after refusing to comply with transfer and reassignment orders.

While holding the strike illegal, the Court of Appeals nonetheless still ruled that the union officers and members were illegally dismissed for non-observance of due process requirements and union busting by management. It likewise gave no credence to the charge of abandonment against Julian and Tejada.

Thus, it awarded separation pay in lieu of reinstatement to all union officers including respondents Julian and Tejada and affirmed all other monetary awards by the Labor Arbiter including backwages.

On this point, we affirm the findings of the appellate court that Julian and Tejada did not abandon their employment. Petitioners utterly failed to show proof that Julian and Tejada had the intent to abandon their work and sever their employment relationship with petitioners. It is established that an employee who forthwith takes steps to protest his layoff cannot be said to have abandoned his work.[20] However, we cannot sustain the appellate court’s ruling that the dismissal of Julian and Tejada was tantamount to unfair labor practice. There is simply nothing on record to show that Julian and Tejada were discouraged or prohibited from joining any union. Hence, the petitioners cannot be held liable for unfair labor practice.

With respect to union officers, however, there is no dispute they could be dismissed for participating in an illegal strike. Union officers are duty- bound to guide their members to respect the law.[21] Nonetheless, as in other termination cases, union officers must be given the required notices for terminating an employment, i.e., notice of hearing to enable them to present their side, and notice of termination, should their explanation prove unsatisfactory. Nothing in Article 264 of the Labor Code authorizes an immediate dismissal of a union officer for participating in an illegal strike. The act of dismissal is not intended to happen ipso facto but rather as an option that can be exercised by the employer and after compliance with the notice requirements for terminating an employee. In this case, petitioners did not give the required notices to the union officers.

We must stress, however, the dismissals per se are not invalid but only ineffectual in accordance with Serrano v. National Labor Relations Commission.[22] In said case, we held that (1) the employer’s failure to comply with the notice requirement does not constitute denial of due process, but mere failure to observe a procedure for termination of employment which makes the termination merely ineffectual,[23] and (2) the dismissal shall be upheld but the employer must be sanctioned for non-compliance with the prescribed procedure.[24] As to the reliefs to be afforded, Serrano decreed that:

In sum, we hold that if in proceedings for reinstatement under Art. 283, it is shown that the termination of employment was due to an authorized cause, then the employee concerned should not be ordered reinstated even though there is failure to comply with the 30-day notice requirement. Instead, he must be granted separation pay in accordance with Art. 283…

…

If the employee’s separation is without cause, instead of being given separation pay, he should be reinstated. In either case, whether he is reinstated or only granted separation pay, he should be paid full backwages if he has been laid off without written notice at least 30 days in advance.

On the other hand, with respect to dismissals for cause under Art. 282, if it is shown that the employee was dismissed for any of the just causes mentioned in said Art. 282, then, in accordance with that article, he should not be reinstated. However, he must be paid backwages from the time his employment was terminated until it is determined that the termination of employment is for a just cause because the failure to hear him before he is dismissed renders the termination of his employment without legal effect.[25]

Admittedly, Serrano does not touch on the termination of an employee who is a mere union member, due to participation in an illegal strike. But it is settled that an employee who is a mere union member does not lose his employment status by mere participation allegedly in an illegal strike. If he is terminated, he is entitled to reinstatement. Moreover, where the employee, whether a union member or officer, is not given any notice for termination such as in this case, he is entitled to be paid backwages from the date of his invalid termination until the final judgment of the case.

In the present case, we affirm the appellate court’s ruling that the union members who are parties herein were illegally dismissed and thus, entitled to reinstatement and payment of backwages for lack of sufficient evidence that they engaged in illegal acts during the strike. They were in good faith in believing that their actions were within the bounds of the law, since such were meant only to secure economic benefits for themselves so as to improve their standard of living. Besides, it is not the business of this Court to determine whether the acts committed by them are illegal, for review of factual issues is not proper in this petition. Review of labor cases elevated to this Court on a petition for review on certiorari is confined merely to questions of law, and not of fact, as factual findings generally are conclusive on this Court.[26]

For the same reasons, we likewise affirm the Court of Appeals in upholding the findings of both the NLRC and the Labor Arbiter regarding the validity or invalidity of quitclaims and the award of other monetary claims. Questions on whether the quitclaims were voluntarily executed or not are factual in nature. Thus, petitioners’ appeal for us to re-examine certain pieces of documentary evidence concerning monetary claims cannot now be entertained. Factual findings of labor officials, who are deemed to have acquired expertise in matters within their respective jurisdiction, are generally accorded not only respect but even finality, and bind us when supported by substantial evidence. It is

not our function to assess and evaluate the evidence all over again, particularly where the findings of both the Arbiter and the Court of Appeals coincide.[27]

WHEREFORE, the assailed Decision of the Court of Appeals, dated April 26, 2000 and its Resolution of October 11, 2000, in CA-G.R. SP No. 53169 are AFFIRMED with MODIFICATION. Dismissal of the union officers is declared NOT INVALID, and the award of separation pay to said union officers is hereby DELETED. However, as a sanction for non-compliance with notice requirements for lawful termination by the petitioners, backwages are AWARDED to the union officers computed from the time they were dismissed until the final entry of judgment of this case. The rest of the dispositions of the Court of Appeals in its Decision of April 26, 2000, in CA-G.R. SP No. 53169, are hereby AFFIRMED. No pronouncement as to costs.

SO ORDERED.

Puno, (Chairman), Austria-Martinez, Callejo, Sr., and Tinga, JJ., concur.

[G.R. No. 119293. June 10, 2003]

SAN MIGUEL CORPORATION, petitioner, vs. NATIONAL LABOR RELATIONS COMMISSION, Second Division, ILAW AT BUKLOD NG MANGGAGAWA (IBM), respondents.

D E C I S I O N

AZCUNA, J.:

Before us is a petition for certiorari and prohibition seeking to set aside the decision of the Second Division of the National Labor Relations Commission (NLRC) in Injunction Case No. 00468-94 dated November 29, 1994,[1] and its resolution dated February 1, 1995[2] denying petitioner’s motion for reconsideration.

Petitioner San Miguel Corporation (SMC) and respondent Ilaw at Buklod ng Manggagawa (IBM), exclusive bargaining agent of petitioner’s daily-paid rank and file employees, executed a Collective Bargaining Agreement (CBA) under which they agreed to submit all disputes to grievance and arbitration proceedings. The CBA also included a mutually enforceable no-strike no-lockout agreement. The pertinent provisions of the said CBA are quoted hereunder:

ARTICLE IV

GRIEVANCE MACHINERY

Section 1. - The parties hereto agree on the principle that all disputes between labor and management may be solved through friendly negotiation;. . . that an open conflict in any form involves losses to the parties, and that, therefore, every effort shall be exerted to avoid such an open conflict. In furtherance of the foregoing principle, the parties hereto have agreed to establish a procedure for the adjustment of grievances so as to (1) provide an opportunity for discussion of any request or complaint and (2) establish procedure for the processing and settlement of grievances.

xxx xxx xxx

ARTICLE V

ARBITRATION

Section 1. Any and all disputes, disagreements and controversies of any kind between the COMPANY and the UNION and/or the workers involving or relating to wages, hours of work, conditions of employment and/or employer-employee relations arising during the effectivity of this Agreement or any renewal thereof, shall be settled by arbitration through a Committee in accordance with the procedure established in this Article. No dispute, disagreement or controversy which may be submitted to the grievance procedure in Article IV shall be presented for arbitration until all the steps of the grievance procedure are exhausted.

xxx xxx xxx

ARTICLE VI

STRIKES AND WORK STOPPAGES

Section 1. The UNION agrees that there shall be no strikes, walkouts, stoppage or slowdown of work, boycotts, secondary boycotts, refusal to handle any merchandise, picketing, sit-down strikes of any kind, sympathetic or general strikes, or any other interference with any of the operations of the COMPANY during the term of this Agreement.

Section 2. The COMPANY agrees that there shall be no lockout during the term of this Agreement so long as the procedure outlined in Article IV hereof is followed by the UNION.[3]

On April 11, 1994, IBM, through its vice-president Alfredo Colomeda, filed with the National Conciliation and Mediation Board (NCMB) a notice of strike, docketed as NCMB-NCR-NS-04-180-94, against petitioner for allegedly committing: (1) illegal dismissal of union members, (2) illegal transfer, (3) violation of CBA, (4) contracting out of jobs being performed by union members, (5) labor-only contracting, (6) harassment of union officers and members, (7) non-recognition of duly-elected union officers, and (8) other acts of unfair labor practice.[4]

The next day, IBM filed another notice of strike, this time through its president Edilberto Galvez, raising similar grounds: (1) illegal transfer, (2) labor-only contracting, (3) violation of CBA, (4) dismissal of union officers and members, and (5) other acts of unfair labor practice. This was docketed as NCMB-NCR-NS-04-182-94.[5]

The Galvez group subsequently requested the NCMB to consolidate its notice of strike with that of the Colomeda group,[6] to which the latter opposed, alleging Galvez’s lack of authority in filing the same.[7]

Petitioner thereafter filed a Motion for Severance of Notices of Strike with Motion to Dismiss, on the grounds that the notices raised non-strikeable issues and that they affected four corporations which are separate and distinct from each other.[8]

After several conciliation meetings, NCMB Director Reynaldo Ubaldo found that the real issues involved are non-strikeable. Hence on May 2, 1994, he issued separate letter-orders to both union groups, converting their notices of strike into preventive mediation. The said letter-orders, in part, read:

During the conciliation meetings, it was clearly established that the real issues involved are illegal dismissal, labor only contracting and internal union disputes, which affect not only the interest of the San Miguel Corporation but also the interests of the MAGNOLIA-NESTLE CORPORATION, the SAN MIGUEL FOODS, INC., and the SAN MIGUEL JUICES, INC.

Considering that San Miguel Corporation is the only impleaded employer-respondent, and considering further that the aforesaid companies are separate and distinct corporate entities, we deemed it wise to

reduce and treat your Notice of Strike as Preventive Mediation case for the four (4) different companies in order to evolve voluntary settlement of the disputes. . . .[9] (Emphasis supplied)

On May 16, 1994, while separate preventive mediation conferences were ongoing, the Colomeda group filed with the NCMB a notice of holding a strike vote. Petitioner opposed by filing a Manifestation and Motion to Declare Notice of Strike Vote Illegal,[10] invoking the case of PAL v. Drilon,[11] which held that no strike could be legally declared during the pendency of preventive mediation. NCMB Director Ubaldo in response issued another letter to the Colomeda Group reiterating the conversion of the notice of strike into a case of preventive mediation and emphasizing the findings that the grounds raised center only on an intra-union conflict, which is not strikeable, thus:

xxx xxx xxx

A perusal of the records of the case clearly shows that the basic point to be resolved entails the question of as to who between the two (2) groups shall represent the workers for collective bargaining purposes, which has been the subject of a Petition for Interpleader case pending resolution before the Office of the Secretary of Labor and Employment. Similarly, the other issues raised which have been discussed by the parties at the plant level, are ancillary issues to the main question, that is, the union leadership...[12] (Emphasis supplied)

Meanwhile, on May 23, 1994, the Galvez group filed its second notice of strike against petitioner, docketed as NCMB-NCR-NS-05-263-94. Additional grounds were set forth therein, including discrimination, coercion of employees, illegal lockout and illegal closure.[13] The NCMB however found these grounds to be mere amplifications of those alleged in the first notice that the group filed. It therefore ordered the consolidation of the second notice with the preceding one that was earlier reduced to preventive mediation.[14] On the same date, the group likewise notified the NCMB of its intention to hold a strike vote on May 27, 1994.

On May 27, 1994, the Colomeda group notified the NCMB of the results of their strike vote, which favored the holding of a strike.[15] In reply, NCMB issued a letter again advising them that by virtue of the PAL v. Drilon ruling, their notice of strike is deemed not to have been filed, consequently invalidating any subsequent strike for lack of compliance with the notice requirement.[16] Despite this and the pendency of the preventive mediation proceedings, on June 4, 1994, IBM went on strike. The strike paralyzed the operations of petitioner, causing it losses allegedly worth P29.98 million in daily lost production.[17]

Two days after the declaration of strike, or on June 6, 1994, petitioner filed with public respondent NLRC an amended Petition for Injunction with Prayer for the Issuance of Temporary Restraining Order, Free Ingress and Egress Order and Deputization Order.[18] After due hearing and ocular inspection, the NLRC on June 13, 1994 resolved to issue a temporary restraining order (TRO) directing free ingress to and egress from petitioner’s plants, without prejudice to the union’s right to peaceful picketing and continuous hearings on the injunction case.[19]

To minimize further damage to itself, petitioner on June 16, 1994, entered into a Memorandum of Agreement (MOA) with the respondent-union, calling for a lifting of the picket lines and resumption of work in exchange of “good faith talks” between the management and the labor management committees. The MOA, signed in the presence of Department of Labor and Employment (DOLE) officials, expressly stated that cases filed in relation to their dispute will continue and will not be affected in any manner whatsoever by the agreement.[20] The picket lines ended and work was then resumed.

Respondent thereafter moved to reconsider the issuance of the TRO, and sought to dismiss the injunction case in view of the cessation of its picketing activities as a result of the signed MOA. It argued that the case had become moot and academic there being no more prohibited activities to restrain, be they actual or threatened.[21] Petitioner, however, opposed and submitted copies of flyers being circulated by IBM, as proof of the union’s alleged threat to revive the strike.[22] The NLRC did not rule on the opposition to the TRO and allowed it to lapse.

On November 29, 1994, the NLRC issued the challenged decision, denying the petition for injunction for lack of factual basis. It found that the circumstances at the time did not constitute or no longer constituted an actual or threatened commission of unlawful acts.[23] It likewise denied petitioner’s motion for reconsideration in its resolution dated February 1, 1995.[24]

Hence, this petition.

Aggrieved by public respondent’s denial of a permanent injunction, petitioner contends that:

A.

THE NLRC GRAVELY ABUSED ITS DISCRETION WHEN IT FAILED TO ENFORCE, BY INJUNCTION, THE PARTIES’ RECIPROCAL OBLIGATIONS TO SUBMIT TO ARBITRATION AND NOT TO STRIKE.

B.

THE NLRC GRAVELY ABUSED ITS DISCRETION IN WITHHOLDING INJUNCTION WHICH IS THE ONLY IMMEDIATE AND EFFECTIVE SUBSTITUTE FOR THE DISASTROUS ECONOMIC WARFARE THAT ARBITRATION IS DESIGNED TO AVOID.

C.

THE NLRC GRAVELY ABUSED ITS DISCRETION IN ALLOWING THE TRO TO LAPSE WITHOUT RESOLVING THE PRAYER FOR INJUNCTION, DENYING INJUNCTION WITHOUT EXPRESSING THE FACTS AND THE LAW ON WHICH IT IS BASED AND ISSUING ITS DENIAL FIVE MONTHS AFTER THE LAPSE OF THE TRO.[25]

We find for the petitioner.

Article 254 of the Labor Code provides that no temporary or permanent injunction or restraining order in any case involving or growing out of labor disputes shall be issued by any court or other entity except as otherwise provided in Articles 218 and 264 of the Labor Code. Under the first exception, Article 218 (e) of the Labor Code expressly confers upon the NLRC the power to “enjoin or restrain actual and threatened commission of any or all prohibited or unlawful acts, or to require the performance of a particular act in any labor dispute which, if not restrained or performed forthwith, may cause grave or irreparable damage to any party or render ineffectual any decision in favor of such party x x x.” The second exception, on the other hand, is when the labor organization or the employer engages in any of the “prohibited activities” enumerated in Article 264.

Pursuant to Article 218 (e), the coercive measure of injunction may also be used to restrain an actual or threatened unlawful strike. In the case of San Miguel Corporation v. NLRC,[26] where the same issue of NLRC’s duty to enjoin an unlawful strike was raised, we ruled that the NLRC committed grave abuse of discretion when it denied the petition for injunction to restrain the union from declaring a strike based on non-strikeable grounds. Further, in IBM v. NLRC,[27] we held that it is the “legal duty and obligation”

of the NLRC to enjoin a partial strike staged in violation of the law. Failure promptly to issue an injunction by the public respondent was likewise held therein to be an abuse of discretion.

In the case at bar, petitioner sought a permanent injunction to enjoin the respondent’s strike. A strike is considered as the most effective weapon in protecting the rights of the employees to improve the terms and conditions of their employment. However, to be valid, a strike must be pursued within legal bounds.[28] One of the procedural requisites that Article 263 of the Labor Code and its Implementing Rules prescribe is the filing of a valid notice of strike with the NCMB. Imposed for the purpose of encouraging the voluntary settlement of disputes,[29] this requirement has been held to be mandatory, the lack of which shall render a strike illegal.[30]

In the present case, NCMB converted IBM’s notices into preventive mediation as it found that the real issues raised are non-strikeable. Such order is in pursuance of the NCMB’s duty to exert “all efforts at mediation and conciliation to enable the parties to settle the dispute amicably,”[31] and in line with the state policy of favoring voluntary modes of settling labor disputes.[32] In accordance with the Implementing Rules of the Labor Code, the said conversion has the effect of dismissing the notices of strike filed by respondent.[33] A case in point is PAL v. Drilon,[34] where we declared a strike illegal for lack of a valid notice of strike, in view of the NCMB’s conversion of the notice therein into a preventive mediation case. We ruled, thus:

The NCMB had declared the notice of strike as “appropriate for preventive mediation.” The effect of that declaration (which PALEA did not ask to be reconsidered or set aside) was to drop the case from the docket of notice of strikes, as provided in Rule 41 of the NCMB Rules, as if there was no notice of strike. During the pendency of preventive mediation proceedings no strike could be legally declared... The strike which the union mounted, while preventive mediation proceedings were ongoing, was aptly described by the petitioner as “an ambush.” (Emphasis supplied)

Clearly, therefore, applying the aforecited ruling to the case at bar, when the NCMB ordered the preventive mediation on May 2, 1994, respondent had thereupon lost the notices of strike it had filed. Subsequently, however, it still defiantly proceeded with the strike while mediation was ongoing, and notwithstanding the letter-advisories of NCMB warning it of its lack of notice of strike. In the case of NUWHRAIN v. NLRC,[35] where the petitioner-union therein similarly defied a prohibition by the NCMB, we said:

Petitioners should have complied with the prohibition to strike ordered by the NCMB when the latter dismissed the notices of strike after finding that the alleged acts of discrimination of the hotel were not ULP, hence not “strikeable.” The refusal of the petitioners to heed said proscription of the NCMB is reflective of bad faith.

Such disregard of the mediation proceedings was a blatant violation of the Implementing Rules, which explicitly oblige the parties to bargain collectively in good faith and prohibit them from impeding or disrupting the proceedings.[36]

The NCMB having no coercive powers of injunction, petitioner sought recourse from the public respondent. The NLRC issued a TRO only for free ingress to and egress from petitioner’s plants, but did not enjoin the unlawful strike itself. It ignored the fatal lack of notice of strike, and five months after came out with a decision summarily rejecting petitioner’s cited jurisprudence in this wise:

Complainant’s scholarly and impressive arguments, formidably supported by a long line of jurisprudence cannot however be appropriately considered in the favorable resolution of the instant case for the complainant. The cited jurisprudence do not squarely cover and apply in this case, as they are not similarly situated and the remedy sought for were different.[37]

Unfortunately, the NLRC decision stated no reason to substantiate the above conclusion.

Public respondent, in its decision, moreover ruled that there was a lack of factual basis in issuing the injunction. Contrary to the NLRC’s finding, we find that at the time the injunction was being sought, there existed a threat to revive the unlawful strike as evidenced by the flyers then being circulated by the IBM-NCR Council which led the union. These flyers categorically declared: “Ipaalala n’yo sa management na hindi iniaatras ang ating Notice of Strike (NOS) at anumang oras ay pwede nating muling itirik ang picket line.”[38] These flyers were not denied by respondent, and were dated June 19, 1994, just a day after the union’s manifestation with the NLRC that there existed no threat of commission of prohibited activities.

Moreover, it bears stressing that Article 264(a) of the Labor Code[39] explicitly states that a declaration of strike without first having filed the required notice is a prohibited activity, which may be prevented through an injunction in accordance with Article 254. Clearly, public respondent should have granted the injunctive relief to prevent the grave damage brought about by the unlawful strike.

Also noteworthy is public respondent’s disregard of petitioner’s argument pointing out the union’s failure to observe the CBA provisions on grievance and arbitration. In the case of San Miguel Corp. v. NLRC,[40] we ruled that the union therein violated the mandatory provisions of the CBA when it filed a notice of strike without availing of the remedies prescribed therein. Thus we held:

x x x For failing to exhaust all steps in the grievance machinery and arbitration proceedings provided in the Collective Bargaining Agreement, the notice of strike should have been dismissed by the NLRC and private respondent union ordered to proceed with the grievance and arbitration proceedings. In the case of Liberal Labor Union vs. Phil. Can Co., the court declared as illegal the strike staged by the union for not complying with the grievance procedure provided in the collective bargaining agreement. . . (Citations omitted)

As in the abovecited case, petitioner herein evinced its willingness to negotiate with the union by seeking for an order from the NLRC to compel observance of the grievance and arbitration proceedings. Respondent however resorted to force without exhausting all available means within its reach. Such infringement of the aforecited CBA provisions constitutes further justification for the issuance of an injunction against the strike. As we said long ago: “Strikes held in violation of the terms contained in a collective bargaining agreement are illegal especially when they provide for conclusive arbitration clauses. These agreements must be strictly adhered to and respected if their ends have to be achieved.”[41]

As to petitioner’s allegation of violation of the no-strike provision in the CBA, jurisprudence has enunciated that such clauses only bar strikes which are economic in nature, but not strikes grounded on unfair labor practices.[42] The notices filed in the case at bar alleged unfair labor practices, the initial determination of which would entail fact-finding that is best left for the labor arbiters. Nevertheless, our finding herein of the invalidity of the notices of strike dispenses with the need to discuss this issue.

We cannot sanction the respondent-union’s brazen disregard of legal requirements imposed purposely to carry out the state policy of promoting voluntary modes of settling disputes. The state’s commitment to enforce mutual compliance therewith to foster industrial peace is affirmed by no less than our Constitution.[43] Trade unionism and strikes are legitimate weapons of labor granted by our statutes. But misuse of these instruments can be the subject of judicial intervention to forestall grave injury to a business enterprise.[44]

WHEREFORE, the instant petition is hereby GRANTED. The decision and resolution of the NLRC in Injunction Case No. 00468-94 are REVERSED and SET ASIDE. Petitioner and private respondent are hereby directed to submit the issues raised in the dismissed notices of strike to grievance procedure and proceed with arbitration proceedings as prescribed in their CBA, if necessary. No pronouncement as to costs.

SO ORDERED.