Lab Rel Cases Set 12013

Labor Relations Cases Atty. Nic Jimeno Set 1 Parts I-III (Course Syllabus) Hernandez, Frauline Camille R.
G.R. No. L-48645 January 7, 1987 "BROTHERHOOD" LABOR UNITY MOVEMENT OF THE PHILIPPINES, ANTONIO CASBADILLO, PROSPERO TABLADA, ERNESTO BENGSON, PATRICIO SERRANO, ANTONIO B. BOBIAS, VIRGILIO ECHAS, DOMINGO PARINAS, NORBERTO GALANG, JUANITO NAVARRO, NESTORIO MARCELLANA, TEOFILO B. CACATIAN, RUFO L. EGUIA, CARLOS SUMOYAN, LAMBERTO RONQUILLO, ANGELITO AMANCIO, DANILO B. MATIAR, ET AL., petitioners, vs. HON. RONALDO B. ZAMORA, PRESIDENTIAL ASSISTANT FOR LEGAL AFFAIRS, OFFICE OF THE PRESIDENT, HON. AMADO G. INCIONG, UNDERSECRETARY OF LABOR, SAN MIGUEL CORPORATION, GENARO OLIVES, ENRIQUE CAMAHORT, FEDERICO OATE, ERNESTO VILLANUEVA, ANTONIO BOCALING and GODOFREDO CUETO, respondents. GUTIERREZ, JR., J.: The elemental question in labor law of whether or not an employer-employee relationship exists between petitioners-members of the "Brotherhood Labor Unit Movement of the Philippines" (BLUM) and respondent San Miguel Corporation, is the main issue in this petition. The disputed decision of public respondent Ronaldo Zamora, Presidential Assistant for legal Affairs, contains a brief summary of the facts involved: 1. The records disclose that on July 11, 1969, BLUM filed a complaint with the now defunct Court of Industrial Relations, charging San Miguel Corporation, and the following officers: Enrique Camahort, Federico Ofiate Feliciano Arceo, Melencio Eugenia Jr., Ernesto Villanueva, Antonio Bocaling and Godofredo Cueto of unfair labor practice as set forth in Section 4 (a), sub-sections (1) and (4) of Republic Act No. 875 and of Legal dismissal. It was alleged that respondents ordered the individual complainants to disaffiliate from the complainant union; and that management dismissed the individual complainants when they insisted on their union membership. On their part, respondents moved for the dismissal of the complaint on the grounds that the complainants are not and have never been employees of respondent company but employees of the independent contractor; that respondent company has never had control over the means and methods followed by the independent contractor who enjoyed full authority to hire and control said employees; and that the individual complainants are barred by estoppel from asserting that they are employees of respondent company.
While pending with the Court of Industrial Relations CIR pleadings and testimonial and documentary evidences were duly presented, although the actual hearing was delayed by several postponements. The dispute was taken over by the National Labor Relations Commission (NLRC) with the decreed abolition of the CIR and the hearing of the case intransferably commenced on September 8, 1975. On February 9, 1976, Labor Arbiter Nestor C. Lim found for complainants which was concurred in by the NLRC in a decision dated June 28, 1976. The amount of backwages awarded, however, was reduced by NLRC to the equivalent of one (1) year salary. On appeal, the Secretary in a decision dated June 1, 1977, set aside the NLRC ruling, stressing the absence of an employer-mployee relationship as borne out by the records of the case. ... The petitioners strongly argue that there exists an employer-employee relationship between them and the respondent company and that they were dismissed for unionism, an act constituting unfair labor practice "for which respondents must be made to answer." Unrebutted evidence and testimony on record establish that the petitioners are workers who have been employed at the San Miguel Parola Glass Factory since 1961, averaging about seven (7) years of service at the time of their termination. They worked as "cargadores" or "pahinante" at the SMC Plant loading, unloading, piling or palleting empty bottles and woosen shells to and from company trucks and warehouses. At times, they accompanied the company trucks on their delivery routes. The petitioners first reported for work to Superintendent-in-Charge Camahort. They were issued gate passes signed by Camahort and were provided by the respondent company with the tools, equipment and paraphernalia used in the loading, unloading, piling and hauling operation. Job orders emanated from Camahort. The orders are then transmitted to an assistant-officer-incharge. In turn, the assistant informs the warehousemen and checkers regarding the same. The latter, thereafter, relays said orders to the capatazes or group leaders who then give orders to the workers as to where, when and what to load, unload, pile, pallet or clean. Work in the glass factory was neither regular nor continuous, depending wholly on the volume of bottles manufactured to be loaded and unloaded, as well as the business activity of the company. Work did not necessarily mean a full eight (8) hour day for the petitioners. However, work,at times, exceeded the eight (8) hour day and necessitated work on Sundays and holidays. For this, they were neither paid overtime nor compensation for work on Sundays and holidays.
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Petitioners were paid every ten (10) days on a piece rate basis, that is, according to the number of cartons and wooden shells they were able to load, unload, or pile. The group leader notes down the number or volume of work that each individual worker has accomplished. This is then made the basis of a report or statement which is compared with the notes of the checker and warehousemen as to whether or not they tally. Final approval of report is by officer-in-charge Camahort. The pay check is given to the group leaders for encashment, distribution, and payment to the petitioners in accordance with payrolls prepared by said leaders. From the total earnings of the group, the group leader gets a participation or share of ten (10%) percent plus an additional amount from the earnings of each individual. The petitioners worked exclusive at the SMC plant, never having been assigned to other companies or departments of SMC plant, even when the volume of work was at its minimum. When any of the glass furnaces suffered a breakdown, making a shutdown necessary, the petitioners work was temporarily suspended. Thereafter, the petitioners would return to work at the glass plant. Sometime in January, 1969, the petitioner workers numbering one hundred and forty (140) organized and affiliated themselves with the petitioner union and engaged in union activities. Believing themselves entitled to overtime and holiday pay, the petitioners pressed management, airing other grievances such as being paid below the minimum wage law, inhuman treatment, being forced to borrow at usurious rates of interest and to buy raffle tickets, coerced by withholding their salaries, and salary deductions made without their consent. However, their gripes and grievances were not heeded by the respondents. On February 6, 1969, the petitioner union filed a notice of strike with the Bureau of Labor Relations in connection with the dismissal of some of its members who were allegedly castigated for their union membership and warned that should they persist in continuing with their union activities they would be dismissed from their jobs. Several conciliation conferences were scheduled in order to thresh out their differences, On February 12, 1969, union member Rogelio Dipad was dismissed from work. At the scheduled conference on February 19, 1969, the complainant union through its officers headed by National President Artemio Portugal Sr., presented a letter to the respondent company containing proposals and/or labor demands together with a request for recognition and collective bargaining. San Miguel refused to bargain with the petitioner union alleging that the workers are not their employees. On February 20, 1969, all the petitioners were dismissed from their jobs and, thereafter, denied entrance to respondent company's glass factory despite their regularly reporting for work. A complaint for illegal dismissal and unfair labor practice was filed by the petitioners.
The case reaches us now with the same issues to be resolved as when it had begun. The question of whether an employer-employee relationship exists in a certain situation continues to bedevil the courts. Some businessmen try to avoid the bringing about of an employer-employee relationship in their enterprises because that judicial relation spawns obligations connected with workmen's compensation, social security, medicare, minimum wage, termination pay, and unionism. (Mafinco Trading Corporation v. Ople, 70 SCRA 139). In determining the existence of an employer-employee relationship, the elements that are generally considered are the following: (a) the selection and engagement of the employee; (b) the payment of wages; (c) the power of dismissal; and (d) the employer's power to control the employee with respect to the means and methods by which the work is to be accomplished. It. is the called "control test" that is the most important element (Investment Planning Corp. of the Phils. v. The Social Security System, 21 SCRA 924; Mafinco Trading Corp. v. Ople, supra,and Rosario Brothers, Inc. v. Ople, 131 SCRA 72). Applying the above criteria, the evidence strongly indicates the existence of an employer-employee relationship between petitioner workers and respondent San Miguel Corporation. The respondent asserts that the petitioners are employees of the Guaranteed Labor Contractor, an independent labor contracting firm. The facts and evidence on record negate respondent SMC's claim. The existence of an independent contractor relationship is generally established by the following criteria: "whether or not the contractor is carrying on an independent business; the nature and extent of the work; the skill required; the term and duration of the relationship; the right to assign the performance of a specified piece of work; the control and supervision of the work to another; the employer's power with respect to the hiring, firing and payment of the contractor's workers; the control of the premises; the duty to supply the premises tools, appliances, materials and labor; and the mode, manner and terms of payment" (56 CJS Master and Servant, Sec. 3(2), 46; See also 27 AM. Jur. Independent Contractor, Sec. 5, 485 and Annex 75 ALR 7260727) None of the above criteria exists in the case at bar. Highly unusual and suspect is the absence of a written contract to specify the performance of a specified piece of work, the nature and extent of the work and the term and duration of the relationship. The records fail to show that a large commercial outfit, such as the San Miguel Corporation, entered into mere oral agreements of employment or labor contracting where the same would involve considerable expenses and dealings with a large number of workers over a long period of time. Despite respondent company's allegations not an iota of evidence was offered
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to prove the same or its particulars. Such failure makes respondent SMC's stand subject to serious doubts. Uncontroverted is the fact that for an average of seven (7) years, each of the petitioners had worked continuously and exclusively for the respondent company's shipping and warehousing department. Considering the length of time that the petitioners have worked with the respondent company, there is justification to conclude that they were engaged to perform activities necessary or desirable in the usual business or trade of the respondent, and the petitioners are, therefore regular employees (Phil. Fishing Boat Officers and Engineers Union v. Court of Industrial Relations, 112 SCRA 159 and RJL Martinez Fishing Corporation v. National Labor Relations Commission, 127 SCRA 454). As we have found in RJL Martinez Fishing Corporation v. National Labor Relations Commission (supra): ... [T]he employer-employee relationship between the parties herein is not coterminous with each loading and unloading job. As earlier shown, respondents are engaged in the business of fishing. For this purpose, they have a fleet of fishing vessels. Under this situation, respondents' activity of catching fish is a continuous process and could hardly be considered as seasonal in nature. So that the activities performed by herein complainants, i.e. unloading the catch of tuna fish from respondents' vessels and then loading the same to refrigerated vans, are necessary or desirable in the business of respondents. This circumstance makes the employment of complainants a regular one, in the sense that it does not depend on any specific project or seasonable activity. (NLRC Decision, p. 94, Rollo).
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(1) The contractor carries on an independent business and undertakes the contract work on his own account under his own responsibility according to his own manner and method, free from the control and direction of his employer or principal in all matters connected with the performance of the work except as to the results thereof; and (2) The contractor has substantial capital or investment in the form of tools, equipment, machineries, work premises, and other materials which are necessary in the conduct of his business. We find that Guaranteed and Reliable Labor contractors have neither substantial capital nor investment to qualify as an independent contractor under the law. The premises, tools, equipment and paraphernalia used by the petitioners in their jobs are admittedly all supplied by respondent company. It is only the manpower or labor force which the alleged contractors supply, suggesting the existence of a "labor only" contracting scheme prohibited by law (Article 106, 109 of the Labor Code; Section 9(b), Rule VIII, Book III, Implementing Rules and Regulations of the Labor Code). In fact, even the alleged contractor's office, which consists of a space at respondent company's warehouse, table, chair, typewriter and cabinet, are provided for by respondent SMC. It is therefore clear that the alleged contractors have no capital outlay involved in the conduct of its business, in the maintenance thereof or in the payment of its workers' salaries. The payment of the workers' wages is a critical factor in determining the actuality of an employeremployee relationship whether between respondent company and petitioners or between the alleged independent contractor and petitioners. It is important to emphasize that in a truly independent contractor-contractee relationship, the fees are paid directly to the manpower agency in lump sum without indicating or implying that the basis of such lump sum is the salary per worker multiplied by the number of workers assigned to the company. This is the rule inSocial Security System v. Court of Appeals (39 SCRA 629, 635). The alleged independent contractors in the case at bar were paid a lump sum representing only the salaries the workers were entitled to, arrived at by adding the salaries of each worker which depend on the volume of work they. had accomplished individually. These are based on payrolls, reports or statements prepared by the workers' group leader, warehousemen and checkers, where they note down the number of cartons, wooden shells and bottles each worker was able to load, unload, pile or pallet and see whether they tally. The amount paid by respondent company to the alleged independent contractor considers no business expenses or capital outlay of the latter. Nor is the profit or gain of the alleged contractor in the conduct of its business provided for as an amount over and above the workers' wages. Instead, the alleged contractor receives a percentage from the total earnings of all the workers plus an additional amount corresponding to a percentage of the earnings of each individual worker, which, perhaps, accounts for the petitioners' charge of unauthorized deductions from their salaries by the respondents.
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so as it with petitioners in the case at bar. In fact, despite past shutdowns of the glass plant for repairs, the petitioners, thereafter, promptly returned to their jobs, never having been replaced, or assigned elsewhere until the present controversy arose. The term of the petitioners' employment appears indefinite. The continuity and habituality of petitioners' work bolsters their claim of employee status vis-a-vis respondent company, Even under the assumption that a contract of employment had indeed been executed between respondent SMC and the alleged labor contractor, respondent's case will, nevertheless, fail. Section 8, Rule VIII, Book III of the Implementing Rules of the Labor Code provides: Job contracting. There is job contracting permissible under the Code if the following conditions are met:
Anent the argument that the petitioners are not employees as they worked on piece basis, we merely have to cite our rulings in Dy Keh Beng v. International Labor and Marine Union of the Philippines (90 SCRA 161), as follows: "[C]ircumstances must be construed to determine indeed if payment by the piece is just a method of compensation and does not define the essence of the relation. Units of time . . . and units of work are in establishments like respondent (sic) just yardsticks whereby to determine rate of compensation, to be applied whenever agreed upon. We cannot construe payment by the piece where work is done in such an establishment so as to put the worker completely at liberty to turn him out and take in another at pleasure." Article 106 of the Labor Code provides the legal effect of a labor only contracting scheme, to wit: ... the person or intermediary shall be considered merely as an agent of the employer who shall be responsible to the workers in the same manner and extent as if the latter were directly employed by him. Firmly establishing respondent SMC's role as employer is the control exercised by it over the petitioners that is, control in the means and methods/manner by which petitioners are to go about their work, as well as in disciplinary measures imposed by it. Because of the nature of the petitioners' work as cargadores or pahinantes, supervision as to the means and manner of performing the same is practically nil. For, how many ways are there to load and unload bottles and wooden shells? The mere concern of both respondent SMC and the alleged contractor is that the job of having the bottles and wooden shells brought to and from the warehouse be done. More evident and pronounced is respondent company's right to control in the discipline of petitioners. Documentary evidence presented by the petitioners establish respondent SMC's right to impose disciplinary measures for violations or infractions of its rules and regulations as well as its right to recommend transfers and dismissals of the piece workers. The inter-office memoranda submitted in evidence prove the company's control over the petitioners. That respondent SMC has the power to recommend penalties or dismissal of the piece workers, even as to Abner Bungay who is alleged by SMC to be a representative of the alleged labor contractor, is the strongest indication of respondent company's right of control over the petitioners as direct employer. There is no evidence to show that the alleged labor contractor had such right of control or much less had been there to supervise or deal with the petitioners. The petitioners were dismissed allegedly because of the shutdown of the glass manufacturing plant. Respondent company would have us believe that this was a case of retrenchment due to the closure or cessation of operations of the establishment or undertaking. But such is not the case here. The
respondent's shutdown was merely temporary, one of its furnaces needing repair. Operations continued after such repairs, but the petitioners had already been refused entry to the premises and dismissed from respondent's service. New workers manned their positions. It is apparent that the closure of respondent's warehouse was merely a ploy to get rid of the petitioners, who were then agitating the respondent company for benefits, reforms and collective bargaining as a union. There is no showing that petitioners had been remiss in their obligations and inefficient in their jobs to warrant their separation. As to the charge of unfair labor practice because of SMC's refusal to bargain with the petitioners, it is clear that the respondent company had an existing collective bargaining agreement with the IBM union which is the recognized collective bargaining representative at the respondent's glass plant. There being a recognized bargaining representative of all employees at the company's glass plant, the petitioners cannot merely form a union and demand bargaining. The Labor Code provides the proper procedure for the recognition of unions as sole bargaining representatives. This must be followed. WHEREFORE, IN VIEW OF THE FOREGOING, the petition is GRANTED. The San Miguel Corporation is hereby ordered to REINSTATE petitioners, with three (3) years backwages. However, where reinstatement is no longer possible, the respondent SMC is ordered to pay the petitioners separation pay equivalent to one (1) month pay for every year of service. SO ORDERED. G.R. No. 87700 June 13, 1990 SAN MIGUEL CORPORATION EMPLOYEES UNION-PTGWO, DANIEL S.L. BORBON II, HERMINIA REYES, MARCELA PURIFICACION, ET AL., petitioners, vs. HON. JESUS G. BERSAMIRA, IN HIS CAPACITY AS PRESIDING JUDGE OF BRANCH 166, RTC, PASIG, and SAN MIGUEL CORPORATION, respondents. MELENCIO-HERRERA, J.: Respondent Judge of the Regional Trial Court of Pasig, Branch 166, is taken to task by petitioners in this special civil action for certiorari and Prohibition for having issued the challenged Writ of Preliminary Injunction on 29 March 1989 in Civil Case No. 57055 of his Court entitled " San Miguel Corporation vs. SMCEU-PTGWO, et als."
Petitioners' plea is that said Writ was issued without or in excess of jurisdiction and with grave abuse of discretion, a labor dispute being involved. Private respondent San Miguel Corporation (SanMig. for short), for its part, defends the Writ on the ground of absence of any employeremployee relationship between it and the contractual workers employed by the companies Lipercon Services, Inc. (Lipercon) and D'Rite Service Enterprises (D'Rite), besides the fact that the Union is bereft of personality to represent said workers for purposes of collective bargaining. The Solicitor General agrees with the position of SanMig. The antecedents of the controversy reveal that: Sometime in 1983 and 1984, SanMig entered into contracts for merchandising services with Lipercon and D'Rite (Annexes K and I, SanMig's Comment, respectively). These companies are independent contractors duly licensed by the Department of Labor and Employment (DOLE). SanMig entered into those contracts to maintain its competitive position and in keeping with the imperatives of efficiency, business expansion and diversity of its operation. In said contracts, it was expressly understood and agreed that the workers employed by the contractors were to be paid by the latter and that none of them were to be deemed employees or agents of SanMig. There was to be no employer-employee relation between the contractors and/or its workers, on the one hand, and SanMig on the other. Petitioner San Miguel Corporation Employees Union-PTWGO (the Union, for brevity) is the duly authorized representative of the monthly paid rank-and-file employees of SanMig with whom the latter executed a Collective Bargaining Agreement (CBA) effective 1 July 1986 to 30 June 1989 (Annex A, SanMig's Comment). Section 1 of their CBA specifically provides that "temporary, probationary, or contract employees and workers are excluded from the bargaining unit and, therefore, outside the scope of this Agreement." In a letter, dated 20 November 1988 (Annex C, Petition), the Union advised SanMig that some Lipercon and D'Rite workers had signed up for union membership and sought the regularization of their employment with SMC. The Union alleged that this group of employees, while appearing to be contractual workers supposedly independent contractors, have been continuously working for SanMig for a period ranging from six (6) months to fifteen (15) years and that their work is neither casual nor seasonal as they are performing work or activities necessary or desirable in the usual business or trade of SanMig. Thus, it was contended that there exists a "labor-only" contracting situation. It was then demanded that the employment status of these workers be regularized. On 12 January 1989 on the ground that it had failed to receive any favorable response from SanMig, the Union filed a notice of strike for unfair labor practice, CBA violations, and union busting (Annex D, Petition).
On 30 January 1989, the Union again filed a second notice of strike for unfair labor practice (Annex F, Petition). As in the first notice of strike. Conciliatory meetings were held on the second notice. Subsequently, the two (2) notices of strike were consolidated and several conciliation conferences were held to settle the dispute before the National Conciliation and Mediation Board (NCMB) of DOLE (Annex G, Petition). Beginning 14 February 1989 until 2 March 1989, series of pickets were staged by Lipercon and D'Rite workers in various SMC plants and offices. On 6 March 1989, SMC filed a verified Complaint for Injunction and Damages before respondent Court to enjoin the Union from: a. representing and/or acting for and in behalf of the employees of LIPERCON and/or D'RITE for the purposes of collective bargaining; b. calling for and holding a strike vote, to compel plaintiff to hire the employees or workers of LIPERCON and D'RITE; c. inciting, instigating and/or inducing the employees or workers of LIPERCON and D'RITE to demonstrate and/or picket at the plants and offices of plaintiff within the bargaining unit referred to in the CBA,...; d. staging a strike to compel plaintiff to hire the employees or workers of LIPERCON and D'RITE; e. using the employees or workers of LIPERCON AND D'RITE to man the strike area and/or picket lines and/or barricades which the defendants may set up at the plants and offices of plaintiff within the bargaining unit referred to in the CBA ...; f. intimidating, threatening with bodily harm and/or molesting the other employees and/or contract workers of plaintiff, as well as those persons lawfully transacting business with plaintiff at the work places within the bargaining unit referred to in the CBA, ..., to compel plaintiff to hire the employees or workers of LIPERCON and D'RITE; g. blocking, preventing, prohibiting, obstructing and/or impeding the free ingress to, and egress from, the work places within the bargaining unit referred to in the
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CBA .., to compel plaintiff to hire the employees or workers of LIPERCON and D'RITE; h. preventing and/or disrupting the peaceful and normal operation of plaintiff at the work places within the bargaining unit referred to in the CBA, Annex 'C' hereof, to compel plaintiff to hire the employees or workers of LIPERCON and D'RITE. (Annex H, Petition) Respondent Court found the Complaint sufficient in form and substance and issued a Temporary Restraining Order for the purpose of maintaining the status quo, and set the application for Injunction for hearing. In the meantime, on 13 March 1989, the Union filed a Motion to Dismiss SanMig's Complaint on the ground of lack of jurisdiction over the case/nature of the action, which motion was opposed by SanMig. That Motion was denied by respondent Judge in an Order dated 11 April 1989. After several hearings on SanMig's application for injunctive relief, where the parties presented both testimonial and documentary evidence on 25 March 1989, respondent Court issued the questioned Order (Annex A, Petition) granting the application and enjoining the Union from Committing the acts complained of, supra. Accordingly, on 29 March 1989, respondent Court issued the corresponding Writ of Preliminary Injunction after SanMig had posted the required bond of P100,000.00 to answer for whatever damages petitioners may sustain by reason thereof. In issuing the Injunction, respondent Court rationalized: The absence of employer-employee relationship negates the existence of labor dispute. Verily, this court has jurisdiction to take cognizance of plaintiff's grievance. The evidence so far presented indicates that plaintiff has contracts for services with Lipercon and D'Rite. The application and contract for employment of the defendants' witnesses are either with Lipercon or D'Rite. What could be discerned is that there is no employer-employee relationship between plaintiff and the contractual workers employed by Lipercon and D'Rite. This, however, does not mean that a final determination regarding the question of the existence of employer-employee relationship has already been made. To finally resolve this dispute, the court must extensively consider and delve into the manner of selection and engagement of the putative employee; the mode of payment of wages; the presence or absence of a power of dismissal; and the Presence or absence of a power to control the putative employee's conduct. This necessitates a
full-blown trial. If the acts complained of are not restrained, plaintiff would, undoubtedly, suffer irreparable damages. Upon the other hand, a writ of injunction does not necessarily expose defendants to irreparable damages. Evidently, plaintiff has established its right to the relief demanded. (p. 21, Rollo) Anchored on grave abuse of discretion, petitioners are now before us seeking nullification of the challenged Writ. On 24 April 1989, we issued a Temporary Restraining Order enjoining the implementation of the Injunction issued by respondent Court. The Union construed this to mean that "we can now strike," which it superimposed on the Order and widely circulated to entice the Union membership to go on strike. Upon being apprised thereof, in a Resolution of 24 May 1989, we required the parties to "RESTORE the status quo ante declaration of strike" (p. 2,62 Rollo). In the meantime, however, or on 2 May 1989, the Union went on strike. Apparently, some of the contractual workers of Lipercon and D'Rite had been laid off. The strike adversely affected thirteen (13) of the latter's plants and offices. On 3 May 1989, the National Conciliation and Mediation Board (NCMB) called the parties to conciliation. The Union stated that it would lift the strike if the thirty (30) Lipercon and D'Rite employees were recalled, and discussion on their other demands, such as wage distortion and appointment of coordinators, were made. Effected eventually was a Memorandum of Agreement between SanMig and the Union that "without prejudice to the outcome of G.R. No. 87700 (this case) and Civil Case No. 57055 (the case below), the laid-off individuals ... shall be recalled effective 8 May 1989 to their former jobs or equivalent positions under the same terms and conditions prior to "lay-off" (Annex 15, SanMig Comment). In turn, the Union would immediately lift the pickets and return to work. After an exchange of pleadings, this Court, on 12 October 1989, gave due course to the Petition and required the parties to submit their memoranda simultaneously, the last of which was filed on 9 January 1990. The focal issue for determination is whether or not respondent Court correctly assumed jurisdiction over the present controversy and properly issued the Writ of Preliminary Injunction to the resolution of that question, is the matter of whether, or not the case at bar involves, or is in connection with, or relates to a labor dispute. An affirmative answer would bring the case within the original and exclusive jurisdiction of labor tribunals to the exclusion of the regular Courts. Petitioners take the position that 'it is beyond dispute that the controversy in the court a quo involves or arose out of a labor dispute and is directly connected or interwoven with the cases pending with the NCMB-DOLE, and is thus beyond the ambit of the public respondent's jurisdiction.
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That the acts complained of (i.e., the mass concerted action of picketing and the reliefs prayed for by the private respondent) are within the competence of labor tribunals, is beyond question" (pp. 6-7, Petitioners' Memo). On the other hand, SanMig denies the existence of any employer-employee relationship and consequently of any labor dispute between itself and the Union. SanMig submits, in particular, that "respondent Court is vested with jurisdiction and judicial competence to enjoin the specific type of strike staged by petitioner union and its officers herein complained of," for the reasons that: A. The exclusive bargaining representative of an employer unit cannot strike to compel the employer to hire and thereby create an employment relationship with contractual workers, especially were the contractual workers were recognized by the union, under the governing collective bargaining agreement, as excluded from, and therefore strangers to, the bargaining unit. B. A strike is a coercive economic weapon granted the bargaining representative only in the event of a deadlock in a labor dispute over 'wages, hours of work and all other and of the employment' of the employees in the unit. The union leaders cannot instigate a strike to compel the employer, especially on the eve of certification elections, to hire strangers or workers outside the unit, in the hope the latter will help re-elect them. C. Civil courts have the jurisdiction to enjoin the above because this specie of strike does not arise out of a labor dispute, is an abuse of right, and violates the employer's constitutional liberty to hire or not to hire. (SanMig's Memorandum, pp. 475-476, Rollo). We find the Petition of a meritorious character. A "labor dispute" as defined in Article 212 (1) of the Labor Code includes "any controversy or matter concerning terms and conditions of employment or the association or representation of persons in negotiating, fixing, maintaining, changing, or arranging the terms and conditions of employment, regardless of whether the disputants stand in the proximate relation of employer and employee." While it is SanMig's submission that no employer-employee relationship exists between itself, on the one hand, and the contractual workers of Lipercon and D'Rite on the other, a labor dispute can nevertheless exist "regardless of whether the disputants stand in the proximate relationship of employer and employee" (Article 212 [1], Labor Code, supra) provided the controversy concerns, among others, the terms and conditions of employment or a "change" or "arrangement" thereof
(ibid). Put differently, and as defined by law, the existence of a labor dispute is not negative by the fact that the plaintiffs and defendants do not stand in the proximate relation of employer and employee. That a labor dispute, as defined by the law, does exist herein is evident. At bottom, what the Union seeks is to regularize the status of the employees contracted by Lipercon and D'Rite in effect, that they be absorbed into the working unit of SanMig. This matter definitely dwells on the working relationship between said employees vis-a-vis SanMig. Terms, tenure and conditions of their employment and the arrangement of those terms are thus involved bringing the matter within the purview of a labor dispute. Further, the Union also seeks to represent those workers, who have signed up for Union membership, for the purpose of collective bargaining. SanMig, for its part, resists that Union demand on the ground that there is no employer-employee relationship between it and those workers and because the demand violates the terms of their CBA. Obvious then is that representation and association, for the purpose of negotiating the conditions of employment are also involved. In fact, the injunction sought by SanMig was precisely also to prevent such representation. Again, the matter of representation falls within the scope of a labor dispute. Neither can it be denied that the controversy below is directly connected with the labor dispute already taken cognizance of by the NCMB-DOLE (NCMB-NCR- NS-01- 021-89; NCMB NCR NS-01-093-83). Whether or not the Union demands are valid; whether or not SanMig's contracts with Lipercon and D'Rite constitute "labor-only" contracting and, therefore, a regular employer-employee relationship may, in fact, be said to exist; whether or not the Union can lawfully represent the workers of Lipercon and D'Rite in their demands against SanMig in the light of the existing CBA; whether or not the notice of strike was valid and the strike itself legal when it was allegedly instigated to compel the employer to hire strangers outside the working unit; those are issues the resolution of which call for the application of labor laws, and SanMig's cause's of action in the Court below are inextricably linked with those issues. The precedent in Layno vs. de la Cruz (G.R. No. L-29636, 30 April 1965, 13 SCRA 738) relied upon by SanMig is not controlling as in that case there was no controversy over terms, tenure or conditions, of employment or the representation of employees that called for the application of labor laws. In that case, what the petitioning union demanded was not a change in working terms and conditions, or the representation of the employees, but that its members be hired as stevedores in the place of the members of a rival union, which petitioners wanted discharged notwithstanding the existing contract of the arrastre company with the latter union. Hence, the ruling therein, on the basis of those facts unique to that case, that such a demand could hardly be considered a labor dispute. As the case is indisputably linked with a labor dispute, jurisdiction belongs to the labor tribunals. As explicitly provided for in Article 217 of the Labor Code, prior to its amendment by R.A. No. 6715 on 21 March 1989, since the suit below was instituted on 6 March 1989, Labor Arbiters have original and exclusive jurisdiction to hear and decide the following cases involving all workers
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including "1. unfair labor practice cases; 2. those that workers may file involving wages, hours of work and other terms and conditions of employment; ... and 5. cases arising from any violation of Article 265 of this Code, including questions involving the legality of striker and lockouts. ..." Article 217 lays down the plain command of the law. The claim of SanMig that the action below is for damages under Articles 19, 20 and 21 of the Civil Code would not suffice to keep the case within the jurisdictional boundaries of regular Courts. That claim for damages is interwoven with a labor dispute existing between the parties and would have to be ventilated before the administrative machinery established for the expeditious settlement of those disputes. To allow the action filed below to prosper would bring about "split jurisdiction" which is obnoxious to the orderly administration of justice (Philippine Communications, Electronics and Electricity Workers Federation vs. Hon. Nolasco, L-24984, 29 July 1968, 24 SCRA 321). We recognize the proprietary right of SanMig to exercise an inherent management prerogative and its best business judgment to determine whether it should contract out the performance of some of its work to independent contractors. However, the rights of all workers to self-organization, collective bargaining and negotiations, and peaceful concerted activities, including the right to strike in accordance with law (Section 3, Article XIII, 1987 Constitution) equally call for recognition and protection. Those contending interests must be placed in proper perspective and equilibrium. WHEREFORE, the Writ of certiorari is GRANTED and the Orders of respondent Judge of 25 March 1989 and 29 March 1989 are SET ASIDE. The Writ of Prohibition is GRANTED and respondent Judge is enjoined from taking any further action in Civil Case No. 57055 except for the purpose of dismissing it. The status quo ante declaration of strike ordered by the Court on 24 May 1989 shall be observed pending the proceedings in the National Conciliation Mediation Board-Department of Labor and Employment, docketed as NCMB-NCR-NS-01-02189 and NCMB-NCR-NS-01-093-83. No costs. SO ORDERED. G.R. No. 172013 October 2, 2009
DECISION PERALTA, J.: Before this Court is a petition for review on certiorari under Rule 45 of the Rules of Court seeking to annul and set aside the Decision and the Resolution of the Court of Appeals (CA) in CA-G.R. SP. No. 86813. Petitioners were employed as female flight attendants of respondent Philippine Airlines (PAL) on different dates prior to November 22, 1996. They are members of the Flight Attendants and Stewards Association of the Philippines (FASAP), a labor organization certified as the sole and exclusive certified as the sole and exclusive bargaining representative of the flight attendants, flight stewards and pursers of respondent. On July 11, 2001, respondent and FASAP entered into a Collective Bargaining Agreement incorporating the terms and conditions of their agreement for the years 2000 to 2005, hereinafter referred to as PAL-FASAP CBA. Section 144, Part A of the PAL-FASAP CBA, provides that: A. For the Cabin Attendants hired before 22 November 1996: xxxx 3. Compulsory Retirement Subject to the grooming standards provisions of this Agreement, compulsory retirement shall be fifty-five (55) for females and sixty (60) for males. x x x. In a letter dated July 22, 2003, petitioners and several female cabin crews manifested that the aforementioned CBA provision on compulsory retirement is discriminatory, and demanded for an equal treatment with their male counterparts. This demand was reiterated in a letter by petitioners' counsel addressed to respondent demanding the removal of gender discrimination provisions in the coming re-negotiations of the PAL-FASAP CBA. On July 12, 2004, Robert D. Anduiza, President of FASAP submitted their 2004-2005 CBA proposals and manifested their willingness to commence the collective bargaining negotiations between the management and the association, at the soonest possible time.
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PATRICIA HALAGUEA, MA. ANGELITA L. PULIDO, MA. TERESITA P. SANTIAGO, MARIANNE V. KATINDIG, BERNADETTE A. CABALQUINTO, LORNA B. TUGAS, MARY CHRISTINE A. VILLARETE, CYNTHIA A. STEHMEIER, ROSE ANNA G. VICTA, NOEMI R. CRESENCIO, and other flight attendants of PHILIPPINE AIRLINES, Petitioners, vs. PHILIPPINE AIRLINES INCORPORATED, Respondent.
On July 29, 2004, petitioners filed a Special Civil Action for Declaratory Relief with Prayer for the Issuance of Temporary Restraining Order and Writ of Preliminary Injunction with the Regional Trial Court (RTC) of Makati City, Branch 147, docketed as Civil Case No. 04-886, against respondent for the invalidity of Section 144, Part A of the PAL-FASAP CBA. The RTC set a hearing on petitioners' application for a TRO and, thereafter, required the parties to submit their respective memoranda. On August 9, 2004, the RTC issued an Order upholding its jurisdiction over the present case. The RTC reasoned that: In the instant case, the thrust of the Petition is Sec. 144 of the subject CBA which is allegedly discriminatory as it discriminates against female flight attendants, in violation of the Constitution, the Labor Code, and the CEDAW. The allegations in the Petition do not make out a labor dispute arising from employer-employee relationship as none is shown to exist. This case is not directed specifically against respondent arising from any act of the latter, nor does it involve a claim against the respondent. Rather, this case seeks a declaration of the nullity of the questioned provision of the CBA, which is within the Court's competence, with the allegations in the Petition constituting the bases for such relief sought. The RTC issued a TRO on August 10, 2004, enjoining the respondent for implementing Section 144, Part A of the PAL-FASAP CBA. The respondent filed an omnibus motion seeking reconsideration of the order overruling its objection to the jurisdiction of the RTC the lifting of the TRO. It further prayed that the (1) petitioners' application for the issuance of a writ of preliminary injunction be denied; and (2) the petition be dismissed or the proceedings in this case be suspended. On September 27, 2004, the RTC issued an Order directing the issuance of a writ of preliminary injunction enjoining the respondent or any of its agents and representatives from further implementing Sec. 144, Part A of the PAL-FASAP CBA pending the resolution of the case. Aggrieved, respondent, on October 8, 2004, filed a Petition for Certiorari and Prohibition with Prayer for a Temporary Restraining Order and Writ of Preliminary Injunction with the Court of Appeals (CA) praying that the order of the RTC, which denied its objection to its jurisdiction, be annuled and set aside for having been issued without and/or with grave abuse of discretion amounting to lack of jurisdiction. The CA rendered a Decision, dated August 31, 2005, granting the respondent's petition, and ruled that:
WHEREFORE, the respondent court is by us declared to have NO JURISDICTION OVER THE CASE BELOW and, consequently, all the proceedings, orders and processes it has so far issued therein are ANNULED and SET ASIDE. Respondent court is ordered to DISMISS its Civil Case No. 04-886. SO ORDERED. Petitioner filed a motion for reconsideration, which was denied by the CA in its Resolution dated March 7, 2006. Hence, the instant petition assigning the following error: THE COURT OF APPEALS' CONCLUSION THAT THE SUBJECT MATTER IS A LABOR DISPUTE OR GRIEVANCE IS CONTRARY TO LAW AND JURISPRUDENCE. The main issue in this case is whether the RTC has jurisdiction over the petitioners' action challenging the legality or constitutionality of the provisions on the compulsory retirement age contained in the CBA between respondent PAL and FASAP. Petitioners submit that the RTC has jurisdiction in all civil actions in which the subject of the litigation is incapable of pecuniary estimation and in all cases not within the exclusive jurisdiction of any court, tribunal, person or body exercising judicial or quasi-judicial functions. The RTC has the power to adjudicate all controversies except those expressly witheld from the plenary powers of the court. Accordingly, it has the power to decide issues of constitutionality or legality of the provisions of Section 144, Part A of the PAL-FASAP CBA. As the issue involved is constitutional in character, the labor arbiter or the National Labor Relations Commission (NLRC) has no jurisdiction over the case and, thus, the petitioners pray that judgment be rendered on the merits declaring Section 144, Part A of the PAL-FASAP CBA null and void. Respondent, on the other hand, alleges that the labor tribunals have jurisdiction over the present case, as the controversy partakes of a labor dispute. The dispute concerns the terms and conditions of petitioners' employment in PAL, specifically their retirement age. The RTC has no jurisdiction over the subject matter of petitioners' petition for declaratory relief because the Voluntary Arbitrator or panel of Voluntary Arbitrators have original and exclusive jurisdiction to hear and decide all unresolved grievances arising from the interpretation or implementation of the CBA. Regular courts have no power to set and fix the terms and conditions of employment. Finally, respondent alleged that petitioners' prayer before this Court to resolve their petition for declaratory relief on the merits is procedurally improper and baseless. The petition is meritorious.
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Jurisdiction of the court is determined on the basis of the material allegations of the complaint and the character of the relief prayed for irrespective of whether plaintiff is entitled to such relief In the case at bar, the allegations in the petition for declaratory relief plainly show that petitioners' cause of action is the annulment of Section 144, Part A of the PAL-FASAP CBA. The pertinent portion of the petition recites: CAUSE OF ACTION 24. Petitioners have the constitutional right to fundamental equality with men under Section 14, Article II, 1987 of the Constitution and, within the specific context of this case, with the male cabin attendants of Philippine Airlines. 26. Petitioners have the statutory right to equal work and employment opportunities with men under Article 3, Presidential Decree No. 442, The Labor Code and, within the specific context of this case, with the male cabin attendants of Philippine Airlines. 27. It is unlawful, even criminal, for an employer to discriminate against women employees with respect to terms and conditions of employment solely on account of their sex under Article 135 of the Labor Code as amended by Republic Act No. 6725 or the Act Strengthening Prohibition on Discrimination Against Women. 28. This discrimination against Petitioners is likewise against the Convention on the Elimination of All Forms of Discrimination Against Women (hereafter, "CEDAW"), a multilateral convention that the Philippines ratified in 1981. The Government and its agents, including our courts, not only must condemn all forms of discrimination against women, but must also implement measures towards its elimination. 29. This case is a matter of public interest not only because of Philippine Airlines' violation of the Constitution and existing laws, but also because it highlights the fact that twentythree years after the Philippine Senate ratified the CEDAW, discrimination against women continues. 31. Section 114, Part A of the PAL-FASAP 2000-20005 CBA on compulsory retirement from service is invidiously discriminatory against and manifestly prejudicial to Petitioners because, they are compelled to retire at a lower age (fifty-five (55) relative to their male counterparts (sixty (60). 33. There is no reasonable, much less lawful, basis for Philippine Airlines to distinguish, differentiate or classify cabin attendants on the basis of sex and thereby arbitrarily set a
lower compulsory retirement age of 55 for Petitioners for the sole reason that they are women. 37. For being patently unconstitutional and unlawful, Section 114, Part A of the PAL-FASAP 2000-2005 CBA must be declared invalid and stricken down to the extent that it discriminates against petitioner. 38. Accordingly, consistent with the constitutional and statutory guarantee of equality between men and women, Petitioners should be adjudged and declared entitled, like their male counterparts, to work until they are sixty (60) years old. PRAYER WHEREFORE, it is most respectfully prayed that the Honorable Court: c. after trial on the merits: (I) declare Section 114, Part A of the PAL-FASAP 2000-2005 CBA INVALID, NULL and VOID to the extent that it discriminates against Petitioners; x x x x From the petitioners' allegations and relief prayed for in its petition, it is clear that the issue raised is whether Section 144, Part A of the PAL-FASAP CBA is unlawful and unconstitutional. Here, the petitioners' primary relief in Civil Case No. 04-886 is the annulment of Section 144, Part A of the PAL-FASAP CBA, which allegedly discriminates against them for being female flight attendants. The subject of litigation is incapable of pecuniary estimation, exclusively cognizable by the RTC, pursuant to Section 19 (1) of Batas Pambansa Blg. 129, as amended. Being an ordinary civil action, the same is beyond the jurisdiction of labor tribunals. The said issue cannot be resolved solely by applying the Labor Code. Rather, it requires the application of the Constitution, labor statutes, law on contracts and the Convention on the Elimination of All Forms of Discrimination Against Women, and the power to apply and interpret the constitution and CEDAW is within the jurisdiction of trial courts, a court of general jurisdiction. In Georg Grotjahn GMBH & Co. v. Isnani, this Court held that not every dispute between an employer and employee involves matters that only labor arbiters and the NLRC can resolve in the exercise of their adjudicatory or quasi-judicial powers. The jurisdiction of labor arbiters and the NLRC 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 statutes, or their collective bargaining agreement.
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Not every controversy or money claim by an employee against the employer or vice-versa is within the exclusive jurisdiction of the labor arbiter. Actions between employees and employer where the employer-employee relationship is merely incidental and the cause of action precedes from a different source of obligation is within the exclusive jurisdiction of the regular court. Here, the employer-employee relationship between the parties is merely incidental and the cause of action ultimately arose from different sources of obligation, i.e., the Constitution and CEDAW. Thus, where the principal relief sought is to be resolved not by reference to the Labor Code or other labor relations statute or a collective bargaining agreement but by the general civil law, the jurisdiction over the dispute belongs to the regular courts of justice and not to the labor arbiter and the NLRC. In such situations, resolution of the dispute requires expertise, not in labor management relations nor in wage structures and other terms and conditions of employment, but rather in the application of the general civil law. Clearly, such claims fall outside the area of competence or expertise ordinarily ascribed to labor arbiters and the NLRC and the rationale for granting jurisdiction over such claims to these agencies disappears. If We divest the regular courts of jurisdiction over the case, then which tribunal or forum shall determine the constitutionality or legality of the assailed CBA provision? This Court holds that the grievance machinery and voluntary arbitrators do not have the power to determine and settle the issues at hand. They have no jurisdiction and competence to decide constitutional issues relative to the questioned compulsory retirement age. Their exercise of jurisdiction is futile, as it is like vesting power to someone who cannot wield it. In Gonzales v. Climax Mining Ltd., this Court affirmed the jurisdiction of courts over questions on constitutionality of contracts, as the same involves the exercise of judicial power. The Court said: Whether the case involves void or voidable contracts is still a judicial question. It may, in some instances, involve questions of fact especially with regard to the determination of the circumstances of the execution of the contracts. But the resolution of the validity or voidness of the contracts remains a legal or judicial question as it requires the exercise of judicial function. It requires the ascertainment of what laws are applicable to the dispute, the interpretation and application of those laws, and the rendering of a judgment based thereon. Clearly, the dispute is not a mining conflict. It is essentially judicial. The complaint was not merely for the determination of rights under the mining contracts since the very validity of those contracts is put in issue. In Saura v. Saura, Jr., this Court emphasized the primacy of the regular court's judicial power enshrined in the Constitution that is true that the trend is towards vesting administrative bodies like the SEC with the power to adjudicate matters coming under their particular specialization, to insure a more knowledgeable solution of the problems submitted to them. This would also relieve
the regular courts of a substantial number of cases that would otherwise swell their already clogged dockets. But as expedient as this policy may be, it should not deprive the courts of justice of their power to decide ordinary cases in accordance with the general laws that do not require any particular expertise or training to interpret and apply. Otherwise, the creeping take-over by the administrative agencies of the judicial power vested in the courts would render the judiciary virtually impotent in the discharge of the duties assigned to it by the Constitution. To be sure, in Rivera v. Espiritu, after Philippine Airlines (PAL) and PAL Employees Association (PALEA) entered into an agreement, which includes the provision to suspend the PAL-PALEA CBA for 10 years, several employees questioned its validity via a petition for certiorari directly to the Supreme Court. They said that the suspension was unconstitutional and contrary to public policy. Petitioners submit that the suspension was inordinately long, way beyond the maximum statutory life of 5 years for a CBA provided for in Article 253-A of the Labor Code. By agreeing to a 10-year suspension, PALEA, in effect, abdicated the workers' constitutional right to bargain for another CBA at the mandated time. In that case, this Court denied the petition for certiorari, ruling that there is available to petitioners a plain, speedy, and adequate remedy in the ordinary course of law. The Court said that while the petition was denominated as one for certiorari and prohibition, its object was actually the nullification of the PAL-PALEA agreement. As such, petitioners' proper remedy is an ordinary civil action for annulment of contract, an action which properly falls under the jurisdiction of the regional trial courts. The change in the terms and conditions of employment, should Section 144 of the CBA be held invalid, is but a necessary and unavoidable consequence of the principal relief sought, i.e., nullification of the alleged discriminatory provision in the CBA. Thus, it does not necessarily follow that a resolution of controversy that would bring about a change in the terms and conditions of employment is a labor dispute, cognizable by labor tribunals. It is unfair to preclude petitioners from invoking the trial court's jurisdiction merely because it may eventually result into a change of the terms and conditions of employment. Along that line, the trial court is not asked to set and fix the terms and conditions of employment, but is called upon to determine whether CBA is consistent with the laws. Although the CBA provides for a procedure for the adjustment of grievances, such referral to the grievance machinery and thereafter to voluntary arbitration would be inappropriate to the petitioners, because the union and the management have unanimously agreed to the terms of the CBA and their interest is unified. In Pantranco North Express, Inc., v. NLRC, this Court held that:
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x x x Hence, only disputes involving the union and the company shall be referred to the grievance machinery or voluntary arbitrators. In the instant case, both the union and the company are united or have come to an agreement regarding the dismissal of private respondents. No grievance between them exists which could be brought to a grievance machinery. The problem or dispute in the present case is between the union and the company on the one hand and some union and non-union members who were dismissed, on the other hand. The dispute has to be settled before an impartial body. The grievance machinery with members designated by the union and the company cannot be expected to be impartial against the dismissed employees. Due process demands that the dismissed workers grievances be ventilated before an impartial body. x x x . Applying the same rationale to the case at bar, it cannot be said that the "dispute" is between the union and petitioner company because both have previously agreed upon the provision on "compulsory retirement" as embodied in the CBA. Also, it was only private respondent on his own who questioned the compulsory retirement. x x x. In the same vein, the dispute in the case at bar is not between FASAP and respondent PAL, who have both previously agreed upon the provision on the compulsory retirement of female flight attendants as embodied in the CBA. The dispute is between respondent PAL and several female flight attendants who questioned the provision on compulsory retirement of female flight attendants. Thus, applying the principle in the aforementioned case cited, referral to the grievance machinery and voluntary arbitration would not serve the interest of the petitioners. Besides, a referral of the case to the grievance machinery and to the voluntary arbitrator under the CBA would be futile because respondent already implemented Section 114, Part A of PAL-FASAP CBA when several of its female flight attendants reached the compulsory retirement age of 55. Further, FASAP, in a letter dated July 12, 2004, addressed to PAL, submitted its association's bargaining proposal for the remaining period of 2004-2005 of the PAL-FASAP CBA, which includes the renegotiation of the subject Section 144. However, FASAP's attempt to change the questioned provision was shallow and superficial, to say the least, because it exerted no further efforts to pursue its proposal. When petitioners in their individual capacities questioned the legality of the compulsory retirement in the CBA before the trial court, there was no showing that FASAP, as their representative, endeavored to adjust, settle or negotiate with PAL for the removal of the difference in compulsory age retirement between its female and male flight attendants, particularly those employed before November 22, 1996. Without FASAP's active participation on behalf of its female flight attendants, the utilization of the grievance machinery or voluntary arbitration would be pointless.
The trial court in this case is not asked to interpret Section 144, Part A of the PAL-FASAP CBA. Interpretation, as defined in Black's Law Dictionary, is the art of or process of discovering and ascertaining the meaning of a statute, will, contract, or other written document. The provision regarding the compulsory retirement of flight attendants is not ambiguous and does not require interpretation. Neither is there any question regarding the implementation of the subject CBA provision, because the manner of implementing the same is clear in itself. The only controversy lies in its intrinsic validity. Although it is a rule that a contract freely entered between the parties should be respected, since a contract is the law between the parties, said rule is not absolute. In Pakistan International Airlines Corporation v. Ople, this Court held that: The principle of party autonomy in contracts is not, however, an absolute principle. The rule in Article 1306, of our Civil Code is that the contracting parties may establish such stipulations as they may deem convenient, "provided they are not contrary to law, morals, good customs, public order or public policy." Thus, counter-balancing the principle of autonomy of contracting parties is the equally general rule that provisions of applicable law, especially provisions relating to matters affected with public policy, are deemed written into the contract. Put a little differently, the governing principle is that parties may not contract away applicable provisions of law especially peremptory provisions dealing with matters heavily impressed with public interest. The law relating to labor and employment is clearly such an area and parties are not at liberty to insulate themselves and their relationships from the impact of labor laws and regulations by simply contracting with each other. Moreover, the relations between capital and labor are not merely contractual. They are so impressed with public interest that labor contracts must yield to the common good.x x x The supremacy of the law over contracts is explained by the fact that labor contracts are not ordinary contracts; these are imbued with public interest and therefore are subject to the police power of the state. It should not be taken to mean that retirement provisions agreed upon in the CBA are absolutely beyond the ambit of judicial review and nullification. A CBA, as a labor contract, is not merely contractual in nature but impressed with public interest. If the retirement provisions in the CBA run contrary to law, public morals, or public policy, such provisions may very well be voided. Finally, the issue in the petition for certiorari brought before the CA by the respondent was the alleged exercise of grave abuse of discretion of the RTC in taking cognizance of the case for declaratory relief. When the CA annuled and set aside the RTC's order, petitioners sought relief before this Court through the instant petition for review under Rule 45. A perusal of the petition before Us, petitioners pray for the declaration of the alleged discriminatory provision in the CBA against its female flight attendants.
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This Court is not persuaded. The rule is settled that pure questions of fact may not be the proper subject of an appeal by certiorari under Rule 45 of the Revised Rules of Court. This mode of appeal is generally limited only to questions of law which must be distinctly set forth in the petition. The Supreme Court is not a trier of facts. The question as to whether said Section 114, Part A of the PAL-FASAP CBA is discriminatory or not is a question of fact. This would require the presentation and reception of evidence by the parties in order for the trial court to ascertain the facts of the case and whether said provision violates the Constitution, statutes and treaties. A full-blown trial is necessary, which jurisdiction to hear the same is properly lodged with the the RTC. Therefore, a remand of this case to the RTC for the proper determination of the merits of the petition for declaratory relief is just and proper.
1avvp hi1
xxx xxx xxx (Rollo, p. 59) The antecedent facts are as follows: On July 4, 1989, respondent union, the National Federation of Sugar Workers-Food and General Trades (NFSW-FGT) filed RAB VI Case No. 06-07-10256-89 against herein petitioner HawaiianPhilippine Company for claims under Republic Act 809 (The Sugar Act of 1952). Respondent union claimed that the sugar farm workers within petitioner's milling district have never availed of the benefits due them under the law. Under Section 9 of R.A 809, otherwise known as the Sugar Act of 1952, it is provided, to wit: 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 (Emphasis supplied.) On July 31, 1989, petitioner filed a "Motion to Dismiss," followed by a "Supplemental Motion to Dismiss" on September 19, 1989. Petitioner contended that public respondent Labor Arbiter has no jurisdiction to entertain and resolve the case, and that respondent union has no cause of action against petitioner. On August 23, 1989, respondent union filed an "Opposition to Motion to Dismiss." On October 3,1989, petitioner applied a "Reply to Opposition" followed by a "Citation of Authorities in Support of Motion to Dismiss." On December 20, 1989, respondent union filed an amended complaint additionally impleading as complainants Efren Elaco, Bienvenido Gulmatico, Alberto Amacio, Narciso Vasquez, Mario
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WHEREFORE, the petition is PARTLY GRANTED. The Decision and Resolution of the Court of Appeals, dated August 31, 2005 and March 7, 2006, respectively, in CA-G.R. SP. No. 86813 are REVERSED and SET ASIDE. The Regional Trial Court of Makati City, Branch 147 is DIRECTED to continue the proceedings in Civil Case No. 04-886 with deliberate dispatch. SO ORDERED. G.R. No. 106231 November 16, 1994 HAWAIIAN-PHILIPPINE COMPANY, petitioner, 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, respondents. BIDIN, J.: This petition for certiorari and prohibition with preliminary injunction seeks to annul the Order dated June 29, 1992 issued by public respondent Labor Arbiter Reynaldo J. Gulmatico denying petitioner's motion for "Claims on R.A. 809" in RAB VI Case No. 06-07-10256-89, the dispositive portion of which reads, in part: WHEREFORE, premises considered, the motion to dismiss dated July 31, 1989 and the supplement thereto dated September 19, 1989 filed by respondent company together with the motion to dismiss filed by respondent Ramon Jison dated August 27, 1990 and Francisco Jison dated September 20, 1990, respectively, are hereby DENIED.
Casociano and all the other farm workers of the sugar planters milling with petitioner from 1979 up to the present, and as respondents, Jose Maria Regalado, Ramon Jison, Rolly Hernaez, Rodolfo Gamboa, Francisco Jison and all other sugar planters milling their canes with petitioner from 1979 up to the present. On August 27, 1990, Ramon Jison, one of the respondents impleaded in the amended complaint, filed a "Motion to Dismiss and/or to Include Necessary Parties," praying for the inclusion as corespondents of the Asociacion de Hacenderos de Silan-Saravia, Inc. and the Associate Planters of Silay-Saravia, Inc. On June 29, 1992, public respondent promulgated the assailed Order denying petitioner's Motion to Dismiss and Supplemental Motion to Dismiss. Hence, this petition filed by Hawaiian-Philippine Company. Petitioner reasserts the two lesson earlier raised in its Motion to Dismiss which public respondent unfavorably resolved in the assailed Order. These two issues are first, whether public respondent Labor Arbiter has jurisdiction to hear and decide the case against petitioner; and the second, whether respondent union and/or the farm workers represented by it have a cause of action against petitioner. Petitioner contends that the complaint filed against it cannot be categorized under any of the cases falling within the jurisdiction of the Labor Arbiter as enumerated in Article 217 of the Labor Code, as amended, considering that no employer-employee relationship exists between petitioner milling company and the farm workers represented by respondent union. Article 217 of the Labor Code provides: Art. 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 employer-employee relations; 5. Cases arising from any violation of Article 264 of this Code, including questions involving the legality of strikes and lockouts; and 6. Except claims for employees' compensation, social security, medicare from 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), whether or not accompanied with a claim for reinstatement. (Emphasis supplies) In support of the contention that the Labor Arbiter has no jurisdiction to hear and decide the case against petitioner, the latter cites the ruling in San Miguel Corporation vs. NLRC, 161 SCRA 719 [1988], wherein it was held that a single unifying element runs through the cases and disputes falling under the jurisdiction of the Labor Arbiter and that is that all the enumerated cases and disputes arise out of or are in connection with an employer-employee relationship, or some aspect or incident of such relationship. Likewise, in Federation of Free Farmers vs. Court of Appeals, 107 SCRA 411 [1981], this Court held that: . . . . From the beginning of the sugar industry, the centrals have never had any privity with the plantation laborers, since they had their own laborers to take care of. . . . Nowhere in Republic Act 809 (the Sugar Act of 1952) can we find anything that creates any relationship between the laborers of the planters and the centrals. . . . . . . Under no principle of law or equity can we impose on the central . . . any liability to the plantation laborers. . . . (Emphasis supplied) On the strength of the aforecited authorities, petitioner contends that it is not a proper party and has no involvement in the case filed by respondent union as it is not the employer of the respondent sugar workers. Furthermore, to bolster its contention, petitioner cites the Rules and Regulations Implementing RA 809 issued by the then Wage Administration Service pursuant to the Administrative Order of the Labor Secretary dated October 1, 1952. Section 1 thereof states:
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Sec. 1. The payment of the proceeds derived from the sixty per centum of any increase in the participation due the laborers shall be directly paid to the individual laborer concerned at the end of each milling season by his respective planter under the Supervision of the Secretary of Labor or his duly authorized representative by means of payrolls prepared by said planter. (Emphasis supplied) In addition, under Letter of Instruction No. 854 dated May 1, 1979, it is provided: 1. Payment subject to supervision. The workers' share shall be paid directly by the planter concerned to the workers or claimants entitled thereto subject to the supervision of the Minister of Labor or his duly designated representative. The responsibility for the payment of the sugar workers' benefits under R.A. 809 was categorically ruled upon in the Federation of Free Farmers case, supra., to wit: . . . the matter of paying the plantation laborers of the respective planters becomes exclusively the concern of the planters, the laborers and the Department of Labor. Under no principle of law or equity can we impose on the Central here VICTORIAS any liability to the respective plantation laborers, should any of their respective planters-employers fail to pay their legal share. After all, since under the law it is the Department of Labor which is the office directly called upon to supervise such payment, it is but reasonable to maintain that if any blame is to be fixed for the unfortunate situation of the unpaid laborers, the same should principally be laid on the planters and secondarily on the Department of Labor, but surely never on the central. Whatever liability there exists between favor of the plantation laborers should be pinned on the PLANTERS, their respective employers. (Emphasis supplied) On the other hand, public respondent and respondent union maintain the position that privity exists between petitioner and the sugar workers. Actually, public respondent, in resolving petitioner's Motion to Dismiss, skirted the issue of whether an employer-employee relationship indeed exists between petitioner milling company and the sugar workers. He did not categorically rule thereon but instead relied on the observation that when petitioner delivered to its planters the quedans representing its share, petitioner did not first ascertain whether the shares of all workers or claimants were fully paid/covered pursuant to LOI No. 854, and that petitioner did not have the necessary certification from the Department of Labor attesting to such fact of delivery. In view of these observations, public respondent subscribed to the possibility that petitioner may still have a liability vis-a-vis the workers' share. Consequently, in order that the workers would not have to litigate their claim separately, which would be tantamount to tolerating the splitting of a cause of
action, public respondent held that petitioner should still be included in this case as an indispensable party without which a full determination of this case would not be obtained. We find for petitioner. The Solicitor General, in its adverse Comment, correctly agreed with petitioner's contention that while the jurisdiction over controversies involving agricultural workers has been transferred from the Court of Agrarian Relations to the Labor Arbiters under the Labor Code as amended, the said transferred jurisdiction is however, not without limitations. The dispute or controversy must still fall under one of the cases enumerated under Article 217 of the Labor Code, which cases, as ruled in San Miguel, supra., arise out of or are in connection with an employer-employee relationship. 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, a fact which, the Solicitor General notes, public respondent did not dispute or was silent about. 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. Anent the issue of whether respondent union and/or its members-workers have a cause of action against petitioner, the same must be resolved in the negative. 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 (Marquez vs. Varela, 92 Phil. 373 [1952]). In the instant case, a simple reading of Section 9 of R.A. 809 and Section 1 of LOI 845 as aforequoted, would show that the payment of the workers' share is a liability of the plantersemployers, and not of the milling company/sugar central. We thus reiterate Our ruling on this matter, as enunciated in Federation of Free Farmers, supra., to wit: . . . . Nowhere in Republic Act No. 809 can we find anything that creates any relationship between the laborers of the planters and the centrals. Under the terms of said Act, the old practice of the centrals issuing the quedans to the respective PLANTERS for their share of the proceeds of milled sugar per their milling contracts has not been altered or modified. In other words, the language of the Act does not in any manner make the central the insurer on behalf of the plantation laborers that the latter's respective employers-planters would pay them their share. . . . . . . . Accordingly, the only obligation of the centrals (under Section 9 of the Act), like VICTORIAS, is to give to the respective planters, like PLANTERS herein, the planters' share in the proportion stipulated in the milling contract which would
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necessarily include the portion of 60% pertaining to the laborers. Once this has been done, the central is already out of the picture. . . . (Emphasis supplied) In the case at bar, it is disputed that petitioner milling company has already distributed to its planters their respective shares. Consequently, petitioner has fulfilled its part and has nothing more to do with the subsequent distribution by the planters of the workers' share. Public respondent's contention that petitioner is an indispensable party is not supported by the applicable provisions of the Rules of Court. Under Section 7, Rule 3 thereof, indispensable parties are "parties in interest" without whom no final determination of the action can be obtained. In this case, petitioner cannot be deemed as a party in interest since there is no privity or legal obligation linking it to respondent union and/or its members-workers. In order to further justify petitioner's compulsory joinder as a party to this case, public respondent relies on petitioners' lack of certification from the Department of Labor of its delivery of the planters' shares as evidence of an alleged "conspicuous display of concerted conspiracy between the respondent sugar central (petitioner) and its adherent planters to deprive the workers or claimants of their shares in the increase in participation of the adherent planters." (Rollo, p. 56) The assertion is based on factual conclusions which have yet to be proved. And even assuming for the sake of argument that public respondent's conclusions are true, respondent union's and/or its workers' recourse lies with the Secretary of Labor, upon whom authority is vested under RA 809 to supervise the payment of the workers' shares. Any act or omission involving the legal right of the workers to said shares may be acted upon by the Labor Secretary either motu proprio or at the instance of the workers. In this case however, no such action has been brought by the subject workers, thereby raising the presumption that no actionable violation has been committed. Public respondent is concerned that the respondent planters may easily put up the defense that the workers' share is with petitioner milling company, giving rise to multiplicity of suits. The Solicitor General correctly postulates that the planters cannot legally set up the said defense since the payment of the workers' share is a direct obligation of the planters to their workers that cannot be shifted to the miller/central. Furthermore, the Solicitor General notes that there is nothing in RA 809 which suggests directly or indirectly that the obligation of the planter to pay the workers' share is dependent upon his receipt from the miller of his own share. If indeed the planter did not receive his just and due share from the miller, he is not without legal remedies to enforce his rights. The proper recourse against a reneging miller or central is for the planter to implead the former not as an indispensable party but as a third party defendant under Section 12, Rule 6 of the Rules of Court. In such case, herein petitioner milling company would be a proper third party dependent 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. WHEREFORE, premises considered, the petition is GRANTED. Public respondent Reynaldo J. Gulmatico is hereby ORDERED to DISMISS RAB VI Case No. 06-07-10256-89 with respect to herein petitioner Hawaiian-Philippine Company and to PROCEED WITH DISPATCH in resolving the said case. SO ORDERED. G.R. No. 117650 March 7, 1996 SULPICIO LINES, INC., petitioner, vs. NATIONAL LABOR RELATIONS COMMISSION and JAIME CAGATAN, respondents. KAPUNAN, J.:p 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. 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 NLRC's Regional Branch No. VII (Cebu), as its main office was located in Cebu City. In an Order dated August 21, 1992 Labor Arbiter Arthur L. Amansec of the NLRC-NCR denied petitioner's Motion to Dismiss, holding that:
Considering that the complainant is a ship steward, traveled on board respondent's ship along the Manila-Enstancia-lloilo-Zamboanga-Cotabato vice-versa route, Manila Can be said to be part of the complainant's territorial workplace.
The aforequoted Order was seasonably appealed to the NLRC by petitioner. On February 28, 1994, respondent NLRC found petitioner's appeal unmeritorious and sustained the Labor Arbiter's
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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." Finding no grave abuse of discretion in the Labor Arbiter's 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 respondent's 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.
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.
Undaunted, petitioner sought a reconsideration of the above Order, which the public respondent denied in its Resolution dated July 22, 1994. 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. It is petitioner's 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. 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. 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. 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. 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, 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
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 NLRC's 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: Sec. 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 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 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 respondent's regular place of assignment is the vessel MV Cotabato Princess which plies the Manila-Estancia-Iloilo-ZamboangaCotabato route, we are of the opinion that Labor Arbiter Arthur L. Amansec was correct in concluding that Manila could be considered part of the complainant's territorial workplace. Respondent NLRC, therefore, committed no grave abuse of discretion in sustaining the labor arbiter's denial of herein petitioner's Motion to Dismiss. WHEREFORE, premises considered, the instant petition is hereby DISMISSED for lack of merit.
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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 highhanded 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

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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 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. 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, does not necessarily give the courts jurisdiction to try the damage suit. Jurisdiction is conferred by law 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, 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," cannot bestow on the respondent court the jurisdiction it does not have. In Cebu Portland Cement Co. v. Cement Workers' Union, 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.
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:
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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 is not well-taken. Calderon has since lost its persuasive force, beginning with our ruling in PEPSI-COLA BOTTLING COMPANY v. MARTINEZ, EBON v. DE GUZMAN, and AGUSAN DEL NORTE ELECTRIC COOP., INC. v. SUAREZ, 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" 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.
xxx xxx xxx In sum, the public respondent has not acted with grave abuse of discretion. WHEREFORE, the petition is DISMISSED. No costs. G.R. No. 110226 June 19, 1997 ALBERTO S. SILVA, EDILBERTO VIRAY ANGELES BARON, CEFERINO ROMERO, JAIME ACEVEDO, RODOLFO JUAN, ANDREW DE LA ISLA BAYANI PILAR, ULDARICO GARCIA, ANANIAS HERMOCILLA, WALLY LEONES, PABLO ALULOD, RODOLFO MARIANO, HERNANI ABOROT, CARLITO CHOSAS, VALERIANO MAUBAN, RENAN HALILI, MANOLITO CUSTODIO, NONILON DAWAL, RICARDO ESCUETA, SEVERINO ROSETE, ERNESTO LITADA, ERNESTO BARENG, BONIFACIO URBANO, VICENTE SANTOS, MARIO CREDO BERNABE GERONIMO, ERNESTO BANAY, PASTOR VELUZ, RICARDO CUEVAS, FELOMENO BALLON, ORLANDO MENDOZA, ANICETO ARBAN, GERONIMO ESPLANA, VICENTE CHAVEZ, STEVE VELECINA, and RICARDO B. VENTURA, petitioners, vs. NATIONAL LABOR RELATIONS COMMISSION and PHILTREAD (FIRESTONE) TIRE AND RUBBER CORPORATION, respondents. ROMERO, J.: Petitioners, all former employees of private respondent Philtread (Firestone) Tire and Rubber Corporation (Philtread, for brevity), impute grave abuse of discretion on the National Labor Relations Commission (NLRC) for issuing two resolutions, dated April 7, 1993, and November 18, 1992, which reconsidered a resolution it rendered on April 15, 1992. They allege that its resolution of April 15, 1992 became final and executory when Philtread failed to seasonably file a motion for reconsideration within the ten-day reglementary period required by Article 223 of the Labor Code. The record unfolds the following facts: Sometime in 1985, petitioners, then rank-and-file employees and members of Philtread Workers Union (PWU), volunteered for, and availed of, the retrenchment program instituted by Philtread with the understanding that they would have priority in re-employment in the event that the company recovers from its financial crisis, in accordance with Section 4, Article III of the Collective Bargaining Agreement concluded on July 5, 1983. In November 1986, Philtread, apparently having recovered from its financial reverses, expanded its operations and hired new personnel. Upon discovery of this development, petitioners filed their
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respective applications for employment with Philtread, which however, merely agreed to consider them for future vacancies. Subsequent demands for re-employment made by petitioners were ignored. Even the request of the incumbent union for Philtread to stop hiring new personnel until petitioners were first hired failed to elicit any favorable response. Thus, on December 5, 1988, petitioners lodged a complaint with the National Capital Region Arbitration Branch of the NLRC for unfair labor practice (ULP), damages and attorney's fees against Philtread. Both parties submitted their respective position papers. On its part, Philtread moved for the dismissal of the complaint based on two grounds, namely: (1) that the NLRC lacked jurisdiction, there being no employer-employee relationship between it and petitioners and that the basic issue involved was the interpretation of a contract, the CBA, which was cognizable by the regular courts; and (2) that petitioners had no locus standi, not being privy to the CBA executed between the union and Philtread. Petitioners, however, challenging Philtread's motion to dismiss, stressed that the complaint was one for unfair labor practice precipitated by the unjust and unreasonable refusal of Philtread to reemploy them, as mandated by the provisions of Section 4, Article III of the 1986 and 1983 CBAs. Being one for unfair labor practice, petitioners concluded that the NLRC had jurisdiction over the case, pursuant to Article 217 (a) (1) of the Labor Code. On August 31, 1989, Labor Arbiter Edgardo M. Madriaga rendered a decision dismissing the complaint but directing Philtread to give petitioners priority in hiring, as well as those former employees similarly situated for available positions provided they meet the necessary current qualifications. In dismissing the complaint, the Labor Arbiter, however, did not tackle the jurisdictional issue posed by Philtread in its position paper. Instead, he dwelt solely on the question whether the petitioners were entitled to priority in re-employment on the basis of the CBA. Petitioners duly appealed the decision of the Labor Arbiter to the NLRC. Philtread opted not to interpose an appeal despite the Labor Arbiter's failure to rule squarely on the question of jurisdiction. On April 15, 1992, the NLRC issued a resolution reversing the decision of the Labor Arbiter. It directed Philtread to re-employ petitioners and other employees similarly situated, regardless of age qualifications and other pre-employment conditions, subject only to existing vacancies and a finding of good physical condition. This resolution was received by Atty. Abraham B. Borreta of the law firm of Borreta, Gutierrez and Leogardo on May 5, 1992, as shown by the bailiff's return.
Subsequently, Atty. Borreta filed with the NLRC on May 20, 1992, an ex parte manifestation explaining that he was returning the copy of the resolution rendered on April 15, 1992, which, according to him, was erroneously served on him by the process server of the NLRC. He alleged that in the several conciliation conferences held, it was Atty. Daniel C. Gutierrez who exclusively handled the case on behalf of Philtread and informed the Labor Arbiter and petitioners that the law firm of Borreta, Gutierrez and Leogardo had already been dissolved. Being of the impression that the April 15, 1992 resolution of the NLRC had been properly served at the address of the law firm of Atty. Gutierrez and that no seasonable motion for reconsideration was ever filed by Philtread, petitioners moved for its execution. On November 18, 1992, the NLRC, acting on a motion for reconsideration filed by Atty. Gutierrez, promulgated one of its challenged resolutions dismissing the complaint of petitioners. It ruled that while petitioners had standing to sue, the complaint should have been filed with the voluntary arbitrator, pursuant to Article 261 of the Labor Code, since the primary issue was the implementation and interpretation of the CBA. Dismayed by the NLRC's sudden change of position, petitioners immediately moved for reconsideration. They pointed out that the NLRC's reliance on Article 261 of the Labor Code was patently erroneous because it was the amended provision which was being cited by the NLRC. They added that the amendment of Article 261 introduced by Republic Act No. 6715 took effect only on March 21, 1989, or after the filing of the complaint on December 5, 1988. This being the case, petitioners argued that the subsequent amendment cannot retroactively divest the Labor Arbiter of the jurisdiction already acquired in accordance with Articles 217 and 248 of the Labor Code. Petitioners further stressed that the resolution of April 15, 1992, had already become final and executory since Philtread's counsel of record did not file any motion for reconsideration within the period of ten (10) days from receipt of the resolution on May 5, 1992. The NLRC, however, was not convinced by petitioners' assertions. In another resolution issued on April 7, 1993, it affirmed its earlier resolution dated November 18, 1992, ruling that even before the amendatory law took effect, matters involving bargaining agreements were already within the exclusive jurisdiction of the voluntary arbitrator, as set forth in Article 262 of the Labor Code. Hence, this petition. As stated at the outset, petitioners fault the NLRC for issuing the assailed resolutions even when the resolution sought to be reconsidered had already attained finality upon Philtread's failure to timely move for its reconsideration. They posit that since the bailiff's return indicated May 5, 1992, as the date of receipt of the April 15, 1992 resolution by the law firm of Borreta, Gutierrez and Leogardo, Philtread's counsel of record, then Philtread only had ten (10) calendar days or until May 15, 1992, within which to file a motion for reconsideration. Since Philtread indisputably failed to file any such
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motion within said period, petitioners deemed it highly irregular and capricious for the NLRC to still allow reconsideration of its April 15, 1992 resolution. The petition is impressed with merit. Time and again, this Court has been emphatic in ruling that the seasonable filing of a motion for reconsideration within the 10-day reglementary period following the receipt by a party of any order, resolution or decision of the NLRC, is a mandatory requirement to forestall the finality of such order, resolution or decision. The statutory bases for this is found in Article 223 of the Labor Code and Section 14, Rule VII of the New Rules of Procedure of the National Labor Relations Commission. In the case at bar, it is uncontroverted that Philtread's counsel filed a motion for reconsideration of the April 15, 1992 resolution only on June 5, 1992, or 31 days after receipt of said resolution. It was thus incumbent upon the NLRC to have dismissed outright Philtread's late motion for reconsideration. By doing exactly the opposite, its actuation was not only whimsical and capricious but also a demonstration of its utter disregard for its very own rules. Certiorari, therefore, lies. To be sure, it is settled doctrine that the NLRC, as an administrative and quasi-judicial body, is not bound by the rigid application of technical rules of procedure in the conduct of its proceedings. However, the filing of a motion for reconsideration and filing it ON TIME are not mere technicalities of procedure. These are jurisdictional and mandatory requirements which must be strictly complied with. Although there are exceptions to said rule, the case at bar presents no peculiar circumstances warranting a departure therefrom. The Court is aware of Philtread's obvious attempt to skirt the requirement for seasonable filing of a motion for reconsideration by persuading us that both the Labor Arbiter and the NLRC have no jurisdiction over petitioners' complaint. Jurisdiction, Philtread claims, lies instead with the voluntary arbitrator so that when the Labor Arbiter and the NLRC took cognizance of the case, their decisions thereon were null and void and, therefore, incapable of attaining finality. In short, Philtread maintains that the ten-day reglementary period could not have started running and, therefore, its motion could not be considered late. The argument is not tenable. While we agree with the dictum that a void judgment cannot attain finality, said rule, however, is only relevant if the tribunal or body which takes cognizance of a particular subject matter indeed lacks jurisdiction over the same. In this case, the rule adverted to is misapplied for it is actually the Labor Arbiter and the NLRC which possess jurisdiction over petitioners' complaint and NOT the voluntary arbitrator, as erroneously contended by Philtread.
In this regard, we observe that there is a confusion in the minds of both Philtread and the NLRC with respect to the proper jurisdiction of the voluntary arbitrator. They appear to share the view that once the question involved is an interpretation or implementation of CBA provisions, which in this case is the re-employment clause, then the same necessarily falls within the competence of the voluntary arbitrator pursuant to Article 261 of the Labor Code. Respondents' posture is too simplistic and finds no support in law or in jurisprudence. When the issue concerns an interpretation or implementation of the CBA, one cannot immediately jump to the conclusion that jurisdiction is with the voluntary arbitrator. There is an equally important need to inquire further if the disputants involved are the union and the employer; otherwise, the voluntary arbitrator cannot assume jurisdiction. To this effect was the ruling of the Court in Sanyo Philippines Workers Union-PSSLU v. Canizares, where we clarified the jurisdiction of the voluntary arbitrator in this manner: In the instant case, however, We hold that the Labor Arbiter and not the Grievance Machinery provided for in the CBA has the jurisdiction to hear and decide the complaints of the private respondents. While it appears that the dismissal of the private respondents was made upon the recommendation of PSSLU pursuant to the union security clause provided in the CBA, We are of the opinion that these facts do not come within the phrase "grievances arising from the interpretation or implementation of (their) 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. Article 260 of the Labor Code on grievance machinery and voluntary arbitrator states that "(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." It is further provided in said article that the parties to a CBA shall name or designate their respective representatives to the grievance machinery and if the grievance is not settled in that level, it shall automatically be referred to voluntary arbitrators (or panel of voluntary arbitrators) designated in advance by the parties. It need not be mentioned that the parties to a CBA are the union and the company. Hence, only disputes involving the union and the company shall be referred to the grievance machinery or voluntary arbitrators. (Emphasis supplied) Since the contending parties in the instant case are not the union and Philtread, then pursuant to the Sanyodoctrine, it is not the voluntary arbitrator who can take cognizance of the complaint,
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notwithstanding Philtread's claim that the real issue is the interpretation of the CBA provision on re-employment. The Court, however, does not write finis to the discussion. A more important question arises: If the voluntary arbitrator could not have assumed jurisdiction over the case, did the Labor Arbiter and the NLRC validly acquire jurisdiction when both of them entertained the complaint? A brief review of relevant statutory provisions is in order. We note that at the time petitioners filed their complaint for unfair labor practice, damages and attorney's fees on December 5, 1988, the governing provision of the Labor Code with respect to the jurisdiction of the Labor Arbiter and the NLRC was Article 217 which states: Art. 217. Jurisdiction of Labor Arbiters and the Commission. (a) The Labor Arbiters shall have the original and exclusive jurisdiction to hear and decide within thirty (30) working days after submission of the case by the parties for decision, the following cases involving all workers, whether agricultural or non-agricultural: 1. Unfair labor practice cases; 2. Those that workers may file involving wages, hours of work and other terms and conditions of employment; 3. All money claims of workers, including those based on non-payment or underpayment of wages, overtime compensation, separation pay and other benefits provided by law or appropriate agreement, except claims for employees' compensation, social security, medicare and maternity benefits; 4. Cases involving household services; and 5. Cases arising from any violation of Article 265 of this Code, including questions involving the legality of strikes and lockouts. (b) The Commission shall have exclusive appellate jurisdiction over all cases decided by Labor Arbiters. Articles 261 and 262, on the other hand, defined the jurisdiction of the voluntary arbitrator, viz.:
Art. 261. Grievance machinery. Whenever a grievance arises from the interpretation or implementation of a collective agreement, including disciplinary actions imposed on members of the bargaining unit, the employer and the bargaining representative shall meet to adjust the grievance. Where there is no collective agreement and in cases where the grievance procedure as provided herein does not apply, grievances shall be subject to negotiation, conciliation or arbitration as provided elsewhere in this Code. Art. 262. Voluntary arbitration. All grievances referred to in the immediately preceding Article which are not settled through the grievance procedure provided in the collective agreement shall be referred to voluntary arbitration prescribed in said agreement: Provided, That termination disputes shall be governed by Article 278 of this Code, as amended, unless the parties agree to submit them to voluntary arbitration. Under the above provisions then prevailing, one can understand why petitioners lodged their complaint for ULP with the Labor Arbiter. To their mind, Philtread's refusal to re-employ them was tantamount to a violation of the re-employment clause in the 1983 CBA which was also substantially reproduced in the 1986 CBA. At the time, any violation of the CBA was unqualifiedly treated as ULP of the employer falling within the competence of the Labor Arbiter to hear and decide. Thus: Art. 248. Unfair labor practices of employers. It shall be unlawful for an employer to commit any of the following unfair labor practice: xxx xxx xxx (i) To violate a collective bargaining agreement. On March 21, 1989, however, Republic Act 6715, or the so-called "Herrera-Veloso Amendments," took effect, amending several provisions of the Labor Code, including the respective jurisdictions of the Labor Arbiter, the NLRC and the voluntary arbitrator. As a result, the present jurisdiction of the Labor Arbiter and the NLRC is as follows: Art. 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:
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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; and 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. while that of the voluntary arbitrator is defined in this wise: Art. 261. Jurisdiction of Voluntary Arbitrators or panel of Voluntary Arbitrators. The Voluntary Arbitrator or panel of Voluntary Arbitrators shall have 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 referred to in the immediately preceding article. According violations of a Collective Bargaining Agreement, except those which are gross in character, shall no longer be treated as unfair labor practice and shall be resolved as as grievances under the Collective Bargaining Agreement. For purposes of this article, gross
violations of Collective Bargaining Agreement shall mean flagrant and/or malicious refusal to comply with the economic provisions of such agreement. . . . (Emphasis supplied) Art. 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. With the amendments introduced by RA 6715, it can be gleaned that the Labor Arbiter still retains jurisdiction over ULP cases. There is, however, a significant change: The unqualified jurisdiction conferred upon the Labor Arbiter prior to the amendment by RA 6715 has been narrowed down so that "violations of a Collective Bargaining Agreement, except those which are gross in character, shall no longer be treated as unfair labor practice but as grievances under the Collective Bargaining Agreement. It is further stated that "gross violations of Collective Bargaining Agreement shall mean flagrant and/or malicious refusal to comply with the economic provisions of such agreement." Hence, for a ULP case to be cognizable by the Labor Arbiter, and the NLRC to exercise its appellate jurisdiction, the allegations in the complaint should show prima facie the concurrence of two things, namely: (1) gross violation of the CBA; AND (2) the violation pertains to the economic provisions of the CBA. In several instances prior to the instant case, the Court already made its pronouncement that RA 6715 is in the nature of a curative statute. As such, we declared that it can be applied retroactively to pending cases. Thus, inBriad Agro Development Corporation v. Dela Cerna, we held: Republic Act No. 6715, like its predecessors, Executive Order No. 111 and Article 217, as amended, has retroactive application. Thus, when this new law divested Regional Directors of the power to hear money claims, the divestment affected pending litigations. It also affected this particular case. (Note that under par 6, where the claim does not exceed P5,000.00, regional directors have jurisdiction). In Garcia v. Martinez, we categorically held that amendments relative to the jurisdiction of labor arbiters (under Presidential Decree No. 1367, divesting the labor arbiter of jurisdiction) partake of the nature of curative statutes, thus: It now appears that at the time this case was decided the lower court had jurisdiction over Velasco's complaint although at the time it was filed said court was not clothed with such jurisdiction. The lack of jurisdiction was cured by the issuance of the amendatory decree which is in the nature of a curative statute
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with retrospective application to a pending proceeding, like Civil Case No. 9657 (See 82 C.J.S. 1004). Garcia has since been uniformly applied in subsequent cases. Thus, in Calderon v. Court of Appeals, reiterated that PD No. 1367 [is] curative and retrospective in nature. The Decision of this case, finally, acknowledged the retrospective characteristics of Executive Order No. 111. . . . With the Briad ruling in place, the implication is that the qualified jurisdiction of the Labor Arbiter and the NLRC should have been applied when the ULP complaint was still pending. This means that petitioners should have been required to show in their complaint the gross nature of the CBA violation, as well as the economic provision violated, without which the complaint would be dismissible. Herein lies the problem. The Court's appreciation of petitioners' cause of action is that, while it would make out a case for ULP, under present law, however, the same falls short of the special requirements necessary to make it cognizable by the Labor Arbiter and the NLRC. Unsubstantiated conclusions of bad faith and unjustified refusal to re-employ petitioners, to our mind, do not constitute gross violation of the CBA for purposes of lodging jurisdiction with the Labor Arbiter and the NLRC. Although evidentiary matters are not required (and even discouraged) to be alleged in complaint, still, sufficient details supporting the conclusion of bad faith and unjust refusal to re-employ petitioners must be indicated. Furthermore, it is even doubtful if the CBA provision on re-employment fits into the accepted notion of an economic provision of the CBA. Thus, given the foregoing considerations, may the Briad doctrine be applied to the instant case and cause its dismissal for want of jurisdiction of the Labor Arbiter and the NLRC? Upon a careful and meticulous study of Briad, the Court holds that the rationale behind it does not apply to the present case. We adopt instead the more recent case of Erectors, Inc. v. National Labor Relations Commission, where we refused to give retroactive application to Executive Order No. 797 which created the Philippine Overseas Employment Administration (POEA). Under said law, POEA was vested with "original and exclusive jurisdiction over all cases, including money claims, involving employer-employee relations arising out of or by virtue of any law or contract involving Filipino workers for overseas employment," which jurisdiction was originally conferred upon the Labor Arbiter. As in the instant case, the Labor Arbiter's assumption of jurisdiction therein was likewise questioned in view of the subsequent enactment of E.O. 797. In ruling against the retroactive application of the law, the Court explained its position as follows: The rule is that jurisdiction over the subject matter is determined by the law in force at the time of the commencement of the action. On March 31, 1982, at the time private respondent filed his complaint against the petitioner, the prevailing laws were Presidential Decree No. 1691 and Presidential Decree No. 1391 which
vested the Regional Offices of the Ministry of Labor and the Labor Arbiters with "original and exclusive jurisdiction over all cases involving employer-employee relations including money claims arising out of any law or contracts involving Filipino workers for overseas employment." At the time of the filing of the complaint, the Labor Arbiter had clear jurisdiction over the same. E.O. No. 797 did not divest the Labor Arbiter's authority to hear and decide the case filed by private respondent prior to its effectivity. Laws should only be applied prospectively unless the legislative intent to give them retroactive effect is expressly declared or is necessarily implied from the language used. We fail to perceive in the language of E.O. No. 797 an intention to give it retroactive effect. The case of Briad Agro Development Corp. vs. Dela Cerna cited by the petitioner is not applicable to the case at bar. In Briad, the Court applied the exception rather than the general rule. In this case, Briad Agro Development Corp. and L.M. Camus Engineering Corp. challenged the jurisdiction of the Regional Director of the Department of Labor and Employment over cases involving workers' money claims, since Article 217 of the Labor Code, the law in force at the time of the filing of the complaint, vested in the Labor Arbiters exclusive jurisdiction over such cases. The Court dismissed the petition in its Decision dated June 29, 1989. It ruled that the enactment of E.O. No. 111, amending Article 217 of the Labor Code, cured the Regional Director's lack of jurisdiction by giving the Labor Arbiter and the Regional Director concurrent jurisdiction over all cases involving money claims. However, on November 9, 1989, the Court, in a Resolution, reconsidered and set aside its June 29 Decision and referred the case to the Labor Arbiter for proper proceedings, in view of the promulgation of Republic Act (R.A.) 6715 which divested the Regional Directors of the power to hear money claims. It bears emphasis that the Court accorded E.O. No. 111 and R.A. 6715 a retroactive application because as curative statutes, they fall under the exceptions to the rule on prospectivity of laws. E.O. No. 111, amended Article 217 of the Labor Code to widen the worker's access to the government for redress of grievances by giving the Regional Directors and Labor Arbiters concurrent jurisdiction over cases involving money claims. This amendment, however, created a situation where the jurisdiction of the Regional Directors and the Labor Arbiters overlapped. As a remedy, R.A. 6715 further amended Article 217 by delineating their respective jurisdictions. Under R.A. 6715, the Regional Director has exclusive original jurisdiction over cases involving money claims provided: (1) the claim is presented by an employer or person employed in domestic or household service, or househelper under the Code; (2) the claimant, no longer being employed, does not seek reinstatement; and (3) the
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aggregate money claim of the employee or househelper does not exceed P5,000.00. All other cases within the exclusive and original jurisdiction of the Labor Arbiter. E.O. No. 111 and R.A. 6715 are therefore curative statutes. A curative statute is enacted to cure defects in a prior law or to validate legal proceedings, instruments or acts of public authorities which would otherwise be void for want of conformity with certain existing legal requirements. The law at bar, E.O. No. 797, is not a curative statute. . . . We do not find any reason why the Court should not apply the above ruling to the case at bar, notwithstanding the fact that a different law is involved. Actually, this is not the first time that the Court refused to apply RA 6715 retroactively. Our previous decisions on whether to give it retroactive application or not depended to a great extent on what amended provisions were under consideration, as well as the factual circumstances to which they were made to apply. In Briad, the underlying reason for applying RA 6715 retroactively was the fact that prior to its amendment, Article 217 of the Labor Code, as amended by then Executive Order No. 111, created a scenario where the Labor Arbiters and the Regional Directors of the Department of Labor and Employment (DOLE) had overlapping jurisdiction over money claims. This situation was viewed as a defect in the law so that when RA No. 6715 was passed and delineated the jurisdiction of the Labor Arbiters and Regional Directors, the Court deemed it a rectification of such defect; hence, the conclusion that it was curative in nature and, therefore, must be applied retroactively. The same thing cannot be said of the case at bar. Like in Erectors, the instant case presents no defect in the law requiring a remedy insofar as the jurisdiction of the Labor Arbiter and the Voluntary Arbitrator is concerned. There is here no overlapping of jurisdiction to speak of because matters involving interpretation and implementation of CBA provisions, as well as interpretation and enforcement of company personnel policies, have always been determined by the Voluntary Arbitrator even prior to RA 6715. Similarly, all ULP cases were exclusively within the jurisdiction of the Labor Arbiter. What RA 6715 merely did was to re-apportion the jurisdiction over ULP cases by conferring exclusive jurisdiction over such ULP cases that do not involve gross violation of a CBA's economic provision upon the voluntary arbitrator. We do not see anything in the act of reapportioning jurisdiction curative of any defect in the law as it stood prior to the enactment of RA 6715. The Court view it as merely a matter of change in policy of the lawmakers, especially since the 1987 Constitution adheres to the preferential use of voluntary modes of dispute settlement. This, instead of the inherent defect in the law, must be the rationale that prompted the amendment. Hence, we uphold the jurisdiction of the Labor Arbiter which attached to this case at the time of its filing on December 5, 1988. Finally, the contention that it was Atty. Gutierrez who exclusively represented Philtread and that the law firm of Borreta, Gutierrez and Leogardo had been dissolved, are lame excuses to cast doubt on the propriety of service to Atty. Borreta. It must be noted that the complaint of petitioners was
filed on December 5, 1988. Presumably, the preliminary conferences adverted to by Atty. Borreta, where Atty. Gutierrez supposedly declared that he was exclusively representing Philtread, transpired at around that date. The Court, however, is surprised to discover that the record bears a Notice of Change of Address dated March 12, 1990, filed by Atty. Gutierrez, indicating therein that the counsel for respondent (Philtread) was "Borreta, Gutierrez and Leogardo" whose address could be found at the "3rd Floor, Commodore Condominium Arquiza corner M. Guerrero Streets, Ermita, Manila." If, indeed, Atty. Gutierrez declared during the Labor Arbiter's proceedings that he was exclusively representing Philtread, why then did he use the firm's name, and its new address at that, in the aforementioned notice to the NLRC? Moreover, why did Atty. Borreta take fifteen days to file his Manifestation and inform the NLRC of the "improper" service of the resolution to him? Why did he not object immediately to the service by the bailiff? Considering that Atty. Gutierrez and Atty. Borreta were once partners in their law firm, it behooves Atty. Borreta to have at least advised his former partner of the receipt of the resolution. As a lawyer, his receipt of the adverse resolution should have alerted him of the adverse consequences which might follow if the same were not acted upon promptly, as what in fact happened here. As for Atty. Gutierrez, if the law firm of Borreta, Gutierrez, and Leogardo were really dissolved, it was incumbent upon him not to have used the firm's name in the first place, or he should have withdrawn the appearance of the firm and entered his own appearance, in case the dissolution took place midstream. By failing to exercise either option, Atty. Gutierrez cannot now blame the NLRC for serving its resolution at the address of the firm still on record. To our mind, these excuses cannot camouflage the clever ploy of Philtread's counsel to earn a last chance to move for reconsideration. This Court, it bears emphasizing, is not impressed, but looks incredulously at such superficial moves. WHEREFORE, the instant petition is hereby GRANTED. The assailed resolutions of the NLRC dated November 18, 1992, and April 7, 1993, are SET ASIDE, while its resolution dated April 15, 1992, is REINSTATED for immediate execution. SO ORDERED. G.R. No. 154830 June 8, 2007
PIONEER CONCRETE PHILIPPINES, INC., PIONEER PHILIPPINES HOLDINGS, and PHILIP J. KLEPZIG,petitioners, vs. ANTONIO D. TODARO, respondent. DECISION AUSTRIA-MARTINEZ, J.:
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Before the Court is a Petition for Review on Certiorari seeking to annul and set aside the Decision of the Court of Appeals (CA) dated October 31, 2000 in CA-G.R. SP No. 54155 and its Resolution of August 21, 2002 denying petitioners Motion for Reconsideration. The factual and procedural antecedents of the case are as follows: On January 16, 1998, herein respondent Antonio D. Todaro (Todaro) filed with the Regional Trial Court (RTC) of Makati City, a complaint for Sum of Money and Damages with Preliminary Attachment against Pioneer International Limited (PIL), Pioneer Concrete Philippines, Inc. (PCPI), Pioneer Philippines Holdings, Inc. (PPHI), John G. McDonald (McDonald) and Philip J. Klepzig (Klepzig). In his complaint, Todaro alleged that PIL is a corporation duly organized and existing under the laws of Australia and is principally engaged in the ready-mix concrete and concrete aggregates business; PPHI is the company established by PIL to own and hold the stocks of its operating company in the Philippines; PCPI is the company established by PIL to undertake its business of ready-mix concrete, concrete aggregates and quarrying operations in the Philippines; McDonald is the Chief Executive of the Hongkong office of PIL; and, Klepzig is the President and Managing Director of PPHI and PCPI; Todaro has been the managing director of Betonval Readyconcrete, Inc. (Betonval), a company engaged in pre-mixed concrete and concrete aggregate production; he resigned from Betonval in February 1996; in May 1996, PIL contacted Todaro and asked him if he was available to join them in connection with their intention to establish a ready-mix concrete plant and other related operations in the Philippines; Todaro informed PIL of his availability and interest to join them; subsequently, PIL and Todaro came to an agreement wherein the former consented to engage the services of the latter as a consultant for two to three months, after which, he would be employed as the manager of PIL's ready-mix concrete operations should the company decide to invest in the Philippines; subsequently, PIL started its operations in the Philippines; however, it refused to comply with its undertaking to employ Todaro on a permanent basis. Instead of filing an Answer, PPHI, PCPI and Klepzig separately moved to dismiss the complaint on the grounds that the complaint states no cause of action, that the RTC has no jurisdiction over the subject matter of the complaint, as the same is within the jurisdiction of the NLRC, and that the complaint should be dismissed on the basis of the doctrine of forum non conveniens. In its Order dated January 4, 1999, the RTC of Makati, Branch 147, denied herein petitioners' respective motions to dismiss. Herein petitioners, as defendants, filed an Urgent Omnibus Motion for the reconsideration of the trial court's Order of January 4, 1999 but the trial court denied it via its Order dated June 3, 1999.
On August 3, 1999, herein petitioners filed a Petition for Certiorari with the CA. On October 31, 2000, the CA rendered its presently assailed Decision denying herein petitioners' Petition for Certiorari. Petitioners filed a Motion for Reconsideration but the CA denied it in its Resolution dated August 21, 2002. Hence, herein Petition for Review on Certiorari based on the following assignment of errors: A. THE COURT OF APPEALS' CONCLUSION THAT THE COMPLAINT STATES A CAUSE OF ACTION AGAINST PETITIONERS IS WITHOUT ANY LEGAL BASIS. THE ANNEXES TO THE COMPLAINT CLEARLY BELIE THE ALLEGATION OF EXISTENCE OF AN EMPLOYMENT CONTRACT BETWEEN PRIVATE RESPONDENT AND PETITIONERS. B. THE COURT OF APPEALS DECIDED A QUESTION OF SUBSTANCE IN A WAY NOT IN ACCORD WITH LAW AND WITH APPLICABLE DECISIONS OF THE SUPREME COURT WHEN IT UPHELD THE JURISDICTION OF THE TRIAL COURT DESPITE THE FACT THAT THE COMPLAINT INDUBITABLY SHOWS THAT IT IS AN ACTION FOR AN ALLEGED BREACH OF EMPLOYMENT CONTRACT, AND HENCE, FALLS WITHIN THE EXLCUSIVE JURISDICTION OF THE NATIONAL LABOR RELATIONS COMMISSION. C THE COURT OF APPEALS DISREGARDED AND FAILED TO CONSIDER THE PRINCIPLE OF "FORUM NON CONVENIENS" AS A VALID GROUND FOR DISMISSING A COMPLAINT. In their first assigned error, petitioners contend that there was no perfected employment contract between PIL and herein respondent. Petitioners assert that the annexes to respondent's complaint show that PIL's offer was for respondent to be employed as the manager only of its pre-mixed concrete operations and not as the company's managing director or CEO. Petitioners argue that when respondent reiterated his intention to become the manager of PIL's overall business venture in the Philippines, he, in effect did not accept PIL's offer of employment and instead made a counter-offer, which, however, was not accepted by PIL. Petitioners also contend that under Article 1318 of the Civil Code, one of the requisites for a contract to be perfected is the consent of the contracting parties; that under Article 1319 of the same Code, consent is manifested by the meeting of the offer and the acceptance upon the thing and the cause which are to constitute the contract; that the offer must be certain and the acceptance absolute; that a qualified acceptance constitutes a
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counter-offer. Petitioners assert that since PIL did not accept respondent's counter-offer, there never was any employment contract that was perfected between them. Petitioners further argue that respondent's claim for damages based on the provisions of Articles 19 and 21 of the Civil Code is baseless because it was shown that there was no perfected employment contract. Assuming, for the sake of argument, that PIL may be held liable for breach of employment contract, petitioners contend that PCPI and PPHI, may not also be held liable because they are juridical entities with personalities which are separate and distinct from PIL, even if they are subsidiary corporations of the latter. Petitioners also aver that the annexes to respondent's complaint show that the negotiations on the alleged employment contract took place between respondent and PIL through its office in Hongkong. In other words, PCPI and PPHI were not privy to the negotiations between PIL and respondent for the possible employment of the latter; and under Article 1311 of the Civil Code, a contract is not binding upon and cannot be enforced against one who was not a party to it even if he be aware of such contract and has acted with knowledge thereof. Petitioners further assert that petitioner Klepzig may not be held liable because he is simply acting in his capacity as president of PCPI and PPHI and settled is the rule that an officer of a corporation is not personally liable for acts done in the performance of his duties and within the bounds of the authority conferred on him. Furthermore, petitioners argue that even if PCPI and PPHI are held liable, respondent still has no cause of action against Klepzig because PCPI and PPHI have personalities which are separate and distinct from those acting in their behalf, such as Klepzig. As to their second assigned error, petitioners contend that since herein respondent's claims for actual, moral and exemplary damages are solely premised on the alleged breach of employment contract, the present case should be considered as falling within the exclusive jurisdiction of the NLRC. With respect to the third assigned error, petitioners assert that the principle of forum non conveniens dictates that even where exercise of jurisidiction is authorized by law, courts may refuse to entertain a case involving a foreign element where the matter can be better tried and decided elsewhere, either because the main aspects of the case transpired in a foreign jurisdiction or the material witnesses have their residence there and the plaintiff sought the forum merely to secure procedural advantage or to annoy or harass the defendant. Petitioners also argue that one of the factors in determining the most convenient forum for conflicts problem is the power of the court to enforce its decision. Petitioners contend that since the majority of the defendants in the present case are not residents of the Philippines, they are not subject to compulsory processes of the Philippine court handling the case for purposes of requiring their attendance during trial. Even assuming that they can be summoned, their appearance would entail excessive costs. Petitioners further assert that there is no allegation in the complaint from which one can conclude that the
evidence to be presented during the trial can be better obtained in the Philippines. Moreover, the events which led to the present controversy occurred outside the Philippines. Petitioners conclude that based on the foregoing factual circumstances, the case should be dismissed under the principle of forum non conveniens. In his Comment, respondent extensively quoted the assailed CA Decision maintaining that the factual allegations in the complaint determine whether or not the complaint states a cause of action. As to the question of jurisdiction, respondent contends that the complaint he filed was not based on a contract of employment. Rather, it was based on petitioners' unwarranted breach of their contractual obligation to employ respondent. This breach, respondent argues, gave rise to an action for damages which is cognizable by the regular courts. Even assuming that there was an employment contract, respondent asserts that for the NLRC to acquire jurisdiction, the claim for damages must have a reasonable causal connection with the employer-employee relationship of petitioners and respondent. Respondent further argues that there is a perfected contract between him and petitioners as they both agreed that the latter shall employ him to manage and operate their ready-mix concrete operations in the Philippines. Even assuming that there was no perfected contract, respondent contends that his complaint alleges an alternative cause of action which is based on the provisions of Articles 19 and 21 of the Civil Code. As to the applicability of the doctrine of forum non conveniens, respondent avers that the question of whether a suit should be entertained or dismissed on the basis of the principle of forum non conveniens depends largely upon the facts of the particular case and is addressed to the sound discretion of the trial judge, who is in the best position to determine whether special circumstances require that the court desist from assuming jurisdiction over the suit. The petition lacks merit. Section 2, Rule 2 of the Rules of Court, as amended, defines a cause of action as the act or omission by which a party violates a right of another. A cause of action exists if the following elements are present: (1) a right in favor of the plaintiff by whatever means and under whatever law it arises or is created; (2) an obligation on the part of the named defendant to respect or not to violate such right; and, (3) an act or omission on the part of such defendant violative of the right of the plaintiff or constituting a breach of the obligation of the defendant to the plaintiff for which the latter may maintain an action for recovery of damages.
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In Hongkong and Shanghai Banking Corporation Limited v. Catalan, this Court held: The elementary test for failure to state a cause of action is whether the complaint alleges facts which if true would justify the relief demanded. Stated otherwise, may the court render a valid judgment upon the facts alleged therein? The inquiry is into the sufficiency, not the veracity of the material allegations. If the allegations in the complaint furnish sufficient basis on which it can be maintained, it should not be dismissed regardless of the defense that may be presented by the defendants. Moreover, the complaint does not have to establish or allege facts proving the existence of a cause of action at the outset; this will have to be done at the trial on the merits of the case. To sustain a motion to dismiss for lack of cause of action, the complaint must show that the claim for relief does not exist, rather than that a claim has been defectively stated, or is ambiguous, indefinite or uncertain. Hence, in resolving whether or not the Complaint in the present case states a cause of action, the trial court correctly limited itself to examining the sufficiency of the allegations in the Complaint as well as the annexes thereto. It is proscribed from inquiring into the truth of the allegations in the Complaint or the authenticity of any of the documents referred or attached to the Complaint, since these are deemed hypothetically admitted by the respondent. This Court has reviewed respondents allegations in its Complaint. In a nutshell, respondent alleged that herein petitioners reneged on their contractual obligation to employ him on a permanent basis. This allegation is sufficient to constitute a cause of action for damages. The issue as to whether or not there was a perfected contract between petitioners and respondent is a matter which is not ripe for determination in the present case; rather, this issue must be taken up during trial, considering that its resolution would necessarily entail an examination of the veracity of the allegations not only of herein respondent as plaintiff but also of petitioners as defendants. The Court does not agree with petitioners' contention that they were not privy to the negotiations for respondent's possible employment. It is evident from paragraphs 24 to 28 of the Complaint that, on various occasions, Klepzig conducted negotiations with respondent regarding the latter's possible employment. In fact, Annex "H" of the complaint shows that it was Klepzig who informed respondent that his company was no longer interested in employing respondent. Hence, based on the allegations in the Complaint and the annexes attached thereto, respondent has a cause of action against herein petitioners.
As to the question of jurisdiction, this Court has consistently held that where no employeremployee relationship exists between the parties and no issue is involved which may be resolved by reference to the Labor Code, other labor statutes or any collective bargaining agreement, it is the Regional Trial Court that has jurisdiction. In the present case, no employer-employee relationship exists between petitioners and respondent. In fact, in his complaint, private respondent is not seeking any relief under the Labor Code, but seeks payment of damages on account of petitioners' alleged breach of their obligation under their agreement to employ him. It is settled that an action for breach of contractual obligation is intrinsically a civil dispute. In the alternative, respondent seeks redress on the basis of the provisions of Articles 19 and 21 of the Civil Code. Hence, it is clear that the present action is within the realm of civil law, and jurisdiction over it belongs to the regular courts. With respect to the applicability of the principle of forum non conveniens in the present case, this Court's ruling inBank of America NT & SA v. Court of Appeals is instructive, to wit: The doctrine of forum non conveniens, literally meaning the forum is inconvenient, emerged in private international law to deter the practice of global forum shopping, that is to prevent non-resident litigants from choosing the forum or place wherein to bring their suit for malicious reasons, such as to secure procedural advantages, to annoy and harass the defendant, to avoid overcrowded dockets, or to select a more friendly venue. Under this doctrine, a court, in conflicts of law cases, may refuse impositions on its jurisdiction where it is not the most "convenient" or available forum and the parties are not precluded from seeking remedies elsewhere. Whether a suit should be entertained or dismissed on the basis of said doctrine depends largely upon the facts of the particular case and is addressed to the sound discretion of the trial court. In the case ofCommunication Materials and Design, Inc. vs. Court of Appeals, this Court held that "xxx [a] Philippine Court may assume jurisdiction over the case if it chooses to do so; provided, that the following requisites are met: (1) that the Philippine Court is one to which the parties may conveniently resort to; (2) that the Philippine Court is in a position to make an intelligent decision as to the law and the facts; and, (3) that the Philippine Court has or is likely to have power to enforce its decision." Moreover, this Court enunciated in Philsec. Investment Corporation vs. Court of Appeals, that the doctrine of forum non conveniens should not be used as a ground for a motion to dismiss because Sec. 1, Rule 16 of the Rules of Court does not include said doctrine as a ground. This Court further ruled that while it is within the discretion of the trial court to abstain from assuming jurisdiction on this ground, it should do so only after vital facts are established, to determine whether special circumstances require the courts desistance; and that the propriety of dismissing a case based on
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this principle of forum non conveniens requires a factual determination, hence it is more properly considered a matter of defense. (emphasis supplied) In the present case, the factual circumstances cited by petitioners which would allegedly justify the application of the doctrine of forum non conveniens are matters of defense, the merits of which should properly be threshed out during trial. WHEREFORE, the instant petition is DENIED and the assailed Decision and Resolution of the Court of Appeals are AFFIRMED. Costs against petitioners. SO ORDERED. G.R. No. 163768 March 27, 2007
The complaint essentially alleged that Virgilio Kawachi hired private respondent as a clerk of the pawnshop and that on certain occasions, she worked beyond the regular working hours but was not paid the corresponding overtime pay. The complaint also narrated an incident on 10 August 2002, wherein petitioner Julius Kawachi scolded private respondent in front of many people about the way she treated the customers of the pawnshop and afterwards terminated private respondents employment without affording her due process. On 7 November 2002, private respondent Dominie Del Quero filed an action for damages against petitioners Julius Kawachi and Gayle Kawachi before the MeTC of Quezon City. The complaint, which was docketed as Civil Case No. 29522, alleged the following: 2. That the Plaintiff was employed as a clerk in the pawnshop business office of the Defendants otherwise known as the A/J RAYMUNDO PAWNSHOP, INC. located (sic) and with principal office address at Unit A Virka Bldg. Edsa Corner Roosevelt[,] Quezon City, from May 27, 2002 to August 10, 2002; 3. That on August 10, 2002 at or about 11:30 AM, the Plaintiff was admonished by the Defendants Julius Kawachi and Gayle Kawachi who are acting as manager and assistant manager respectively of the pawnshop business and alternately accused her of having committed an act which she had not done and was scolded in a loud voice in front of many employees and customers in their offices; 4. That further for no apparent reason the Plaintiff was ordered to get out and leave the pawnshop office and was told to wait for her salary outside the office when she tried to explain that she had no fault in the complaint of the customer, (sic) [H]owever[,] her explanation fell on deaf ears; 5. That she was instantly dismissed from her job without due process; 6. That the incident happened in front of many people which caused the Plaintiff to suffer serious embarrassment and shame so that she could not do anything but cry because of the shameless way by which she was terminated from the service; x x x The complaint for damages specifically sought the recovery of moral damages, exemplary damages and attorneys fees. Petitioners moved for the dismissal of the complaint on the grounds of lack of jurisdiction and forum-shopping or splitting causes of action. At first, the MeTC granted petitioners motion and
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JULIUS KAWACHI and GAYLE KAWACHI, Petitioners, vs. DOMINIE DEL QUERO and HON. JUDGE MANUEL R. TARO, Metropolitan Trial Court, Branch 43, Quezon City, Respondents. DECISION TINGA, J.: This is a petition for review on certiorari under Rule 45 of the Rules of Civil Procedure, assailing two resolutions of the Regional Trial Court (RTC), Branch 226, Quezon City which affirmed the jurisdiction of the Metropolitan Trial Court (MeTC), Branch 42, Quezon City over private respondents action for damages against petitioner. The following factual antecedents are matters of record.
1 vvphi1.nt
In an Affidavit-Complaint dated 14 August 2002, private respondent Dominie Del Quero charged A/J Raymundo Pawnshop, Inc., Virgilio Kawachi and petitioner Julius Kawachi with illegal dismissal, non-execution of a contract of employment, violation of the minimum wage law, and nonpayment of overtime pay. The complaint was filed before the National Labor Relations Commission (NLRC).
ordered the dismissal of the complaint for lack of jurisdiction in an Order dated 2 January 2003. Upon private respondents motion, the MeTC reconsidered and set aside the order of dismissal in an Order dated 3 March 2003. It ruled that no causal connection appeared between private respondents cause of action and the employer-employee relations between the parties. The MeTC also rejected petitioners motion for reconsideration in an Order dated 22 April 2003. Thus, petitioners elevated the MeTCs aforesaid two orders to the RTC, Branch 226 of Quezon City, via a Petition for Certiorari (With Prayer for Temporary Restraining Order and/or Preliminary Injunction). After due hearing, the RTC declined petitioners prayer for a temporary restraining order. For her part, private respondent filed a Motion to Dismiss Petition. On 20 October 2003, the RTC issued the assailed Resolution, upholding the jurisdiction of the MeTC over private respondents complaint for damages. The RTC held that private respondents action for damages was based on the alleged tortious acts committed by her employers and did not seek any relief under the Labor Code. The RTC cited the pronouncement in Medina, et al. v. Hon. Castro-Bartolome, etc., et al. where the Court held that the employees action for damages based on the slanderous remarks uttered by the employer was within the regular courts jurisdiction since the complaint did not allege any unfair labor practice on the part of the employer. On 29 March 2004, the RTC denied petitioners motion for reconsideration. Hence, the instant petition for review on certiorari, raising the sole issue of jurisdiction over private respondents complaint for damages. Petitioners argue that the NLRC has jurisdiction over the action for damages because the alleged injury is work-related. They also contend that private respondent should not be allowed to split her causes of action by filing the action for damages separately from the labor case. Private respondent maintains that there is no causal connection between her cause of action and the employer-employee relations of the parties. The petition is meritorious. The jurisdictional controversy of the sort presented in this case has long been settled by this Court. 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.
In the 1999 case of San Miguel Corporation v. Etcuban, the Court noted what was then the current trend, and still is, to refer worker-employer controversies to labor courts, unless unmistakably provided by the law to be otherwise. Because of the trend, the Court noted further, jurisprudence has developed the "reasonable causal connection rule." Under this rule, if there is a reasonable causal connection between the claim asserted and the employer-employee relations, then the case is within the jurisdiction of our labor courts. In the absence of such nexus, it is the regular courts that have jurisdiction. In San Miguel Corporation, the Court upheld the labor arbiters jurisdiction over the employees separate action for damages, which also sought the nullification of the so-called "contract of termination" and noted that the allegations in the complaint were so carefully formulated as to avoid a semblance of employer-employee relations. In said case, the employees of San Miguel Corporation (SMC) availed of the "Retrenchment to Prevent Loss Program." After their inclusion in the retrenchment program, the employees were given their termination letters and separation pay. In return, the employees executed "receipt and release" documents in favor of the company. Subsequently, the employees learned that the company was never in financial distress and was engaged in hiring new employees. Thus, they filed a complaint before the NLRC for the declaration of nullity of the retrenchment program and prayed for reinstatement, backwages and damages. After the labor arbiter dismissed the complaint, the employees filed an action for damages before the RTC, alleging the deception employed upon them by SMC which led to their separation from the company. They sought the declaration of nullity of their so-called collective "contract of termination" and the recovery of actual and compensatory damages, moral damages, exemplary damages, and attorneys fees. The Court held that the employees claim for damages was intertwined with their having been separated from their employment without just cause and, consequently, had a reasonable causal connection with their employer-employee relations with petitioner. The Court explained in this manner: x x x First, their claim for damages is grounded on their having been deceived into serving their employment due to SMCs concocted financial distress and fraudulent retrenchment programa clear case of illegal dismissal. Second, a comparison of respondents c omplaint for the declaration of nullity of the retrenchment program before the labor arbiter and the complaint for the declaration of nullity of their "contract of termination" before the RTC reveals that the allegations and prayer of the former are almost identical with those of the latter except that the prayer for reinstatement was no longer included and the claim for backwages and other benefits was replaced with a claim for actual damages. These are telltale signs that respondents claim for damages is intertwined with their having been separated from their employment without just cause and, consequently, has a
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reasonable causal connection with their employer-employee relations with SMC. Accordingly, it cannot be denied that respondents claim falls under the jurisdiction of the labor arbiter as provided in paragraph 4 of Article 217. The "reasonable causal connection rule" emerged in the 1987 case of Primero v. Intermediate Appellate Court, where the Court recognized the jurisdiction of the labor arbiters over claims for damages in connection with termination of employment, thus: It is clear that the question of the legality of the act of dismissal is intimately related to the issue of the legality ofthe manner by which that act of dismissal was performed. But while the Labor Code treats of the nature of, and the remedy available as regards the first the employees separation from employment it does not at all deal with the second the manner of that separation which is governed exclusively by the Civil Code. In addressing the first issue, the Labor Arbiter applies the Labor Code; in addressing the second, the Civil Code. And this appears to be the plain and patent intendment of the law. For apart from the reliefs expressly set out in the Labor Code flowing from illegal dismissal from employment, no other damages may be awarded to an illegally dismissed employee other than those specified by the Civil Code. Hence, the fact that the issueof whether or not moral or other damages were suffered by an employee and in the affirmative, the amount that should properly be awarded to him in the circumstancesis determined under the provisions of the Civil Code and not the Labor Code, obviously was not meant to create a cause of action independent of that for illegal dismissal and thus place the matter beyond the Labor Arbiters jurisdiction. In the instant case, the allegations in private respondents complaint for damages show that her injury was the offshoot of petitioners immediate harsh reaction as her administrative superiors to the supposedly sloppy manner by which she had discharged her duties. Petitioners reaction culminated in private respondents dismissal from work in the very same incident. The incident on 10 August 2002 alleged in the complaint for damages was similarly narrated in private respondents Affidavit-Complaint supporting her action for illegal dismissal before the NLRC. Clearly, the alleged injury is directly related to the employer-employee relations of the parties. Where the employer-employee relationship is merely incidental and the cause of action proceeds from a different source of obligation, the Court has not hesitated to uphold the jurisdiction of the regular courts. Where the damages claimed for were based on tort, malicious prosecution, or breach of contract, as when the claimant seeks to recover a debt from a former employee or seeks liquidated
damages in the enforcement of a prior employment contract, the jurisdiction of regular courts was upheld. The scenario that obtains in this case is obviously different. The allegations in private respondents complaint unmistakably relate to the manner of her alleged illegal dismissal. For a single cause of action, the dismissed employee cannot be allowed to sue in two forums: one, before the labor arbiter for reinstatement and recovery of back wages or for separation pay, upon the theory that the dismissal was illegal; and two, before a court of justice for recovery of moral and other damages, upon the theory that the manner of dismissal was unduly injurious or tortious. Suing in the manner described is known as "splitting a cause of action," a practice engendering multiplicity of actions. It is considered procedurally unsound and obnoxious to the orderly administration of justice. In the instant case, the NLRC has jurisdiction over private respondents complaint for illegal dismissal and damages arising therefrom. She cannot be allowed to file a separate or independent civil action for damages where the alleged injury has a reasonable connection to her termination from employment. Consequently, the action for damages filed before the MeTC must be dismissed. 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. SO ORDERED. G.R. No. 169494 March 14, 2007
CABALEN MANAGEMENT CO., INC., MA.ESTELA O. NIEVERA, IAN TIONGSON, ADJI TIONGSON, ESTER O. NIEVERA and ANASTACIA NAVAL, ADRIANO JR. CORPORATION, LEDA A. PANGILINAN, EVA S. CANDELARIA, ROSE MARIE MORALES, DANILO SUNUBA, LETECIA DAVID, MARLON BULANADI, MA. THERESA L. GADDI and CONSUELO HALILI REYES, Petitioners, vs. JESUS P. QUIAMBAO, GERALDINE M. PALERMO, RODEL B. PANGILINAN, WILLIAM F. LACSON, ROCHELLE B. DE LEON, JOCELYN B. DEANG, EDGAR E. DE GUZMAN, VIZIER INOCENCIO, VINCENT EDWARD C. MAPUA and JESSEBEL G. OBIEN, Respondents. DECISION CARPIO MORALES, J.:
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Before this Court is a petition for review on certiorari assailing the April 29, 2005 Decision1 of the Court of Appeals and Resolution of August 25, 20052 in CA-G.R. SP No. 85159. The assailed Decision reversed the finding of the National Labor Relations Commission (NLRC) and that of the Labor Arbiter that, except for respondents Jesus P. Quiambao (Quiambao) and Geraldine M. Palermo (Palermo), the other respondents were validly dismissed from employment for their various infractions of the Code of Conduct of petitioner Cabalen Management Co., Inc. (the company). The assailed Resolution, on the other hand, denied petitioners motion for reconsideration. Prior to their dismissal, respondents Quiambao, Palermo, Rochelle B. De Leon and Jocelyn B. Deang were working as dining supervisor, cashier, receptionist, and kitchen supervisor, respectively, while respondents Jessebel G. Obien, Edgar E. De Guzman, Rodel B. Pangilinan, William F. Lacson, Vizier Inocencio and Vincent Edward C. Mapua were waiters at the companys Cabalen restaurant, Quad, Glorietta branch. On September 4, 2001, respondents received a memorandum placing each one of them on preventive suspension for 30 days without pay and ordering them to explain within 48 hours reported violations of the companys Code of Conduct. In compliance with the memorandum, respondents filed their written explanations, denying or refuting the charges against them. On October 4, 2001, respondents, with the exception of Quiambao and Palermo, were served with notices of dismissal after petitioners adjudged them guilty of the charges. The dismissal of respondents was based on the statements of two witnesses, Henry dela Vega Balen (Balen) and Roderick Malana (Malana), their co-employees, that they had connived with one another in pocketing tips which were intended for the group, serving food or drinks without receipts or with tampered ones, and committing like forms of stealing, resulting in losses or damages to the company. An audit report dated September 19, 2001 on the companys accountable forms and on incidents of missing bar order slips (OS), swapping of dining and bar OS, unrecorded bar OS issuance, and excessive cancellation of OS and official receipts, was also considered as evidence against respondents. As for Quiambao and Palermo, while they were directed to immediately report to the Human Resources Department (HRD), they were allegedly not given any assignments.
Respondents thus filed three separate cases against herein petitioners, the company and Adriano Jr. Corporation, together with the Cabalen restaurant at the Glorietta, for illegal dismissal and illegal suspension, with claims for 13th month pay, sick and vacation leaves, monthly allowances, weekly tip, monthly signed chit, unpaid salaries, moral and exemplary damages, attorneys fees, and regularization for respondents Palermo, Pangilinan, Lacson, Deang and De Guzman. The complaints were later amended to implead herein individual petitioners as respondents. Labor Arbiter Virginia T. Luyas-Azarraga, finding that the evidence presented by petitioners had sufficiently proved the charges against respondents Lacson, De Leon, Deang, Pangilinan, De Guzman and Obien, held, by Decision of November 27, 2002, that they were validly dismissed from the service. With respect to respondents Quiambao and Palermo, however, the Labor Arbiter ordered petitioners to reinstate them to their previous positions "under the same terms and conditions prevailing as of September 4, 2001, but without backwages." The two were accordingly directed to return to work within 48 hours from receipt of the decision. All other claims, except for the proportionate 13th month pay for 2001, were dismissed for lack of merit. The complaints of Inocencio and Mapua, who failed to sign the position paper for the complainants, were dismissed for lack of interest. By Resolution of September 30, 2003, the NLRC affirmed the Labor Arbiters decision. In upholding the Labor Arbiters findings and conclusions, the Commission found well-taken the observation that, stripped of herein respondents attacks on the persons of herein individual petitioners, respondents had presented no material allegation or evidence to controvert the charges against them. Respondents filed a motion for reconsideration of the NLRC resolution, with a supplemental manifestation from respondent Quiambao that he was not reinstated to his previous position, as ordered by the Labor Arbiter, but was instead assigned to the companys head office in a "floating status," and that on April 21, 2003, he was served a Notice of Termination of Service because the company was said to be losing heavily and had to retrench to avoid closure. Respondents motion for reconsideration was denied by the NLRC by Resolution of April 28, 2004 for lack of merit. On respondents petition for certiorari, the Court of Appeals, by Decision of April 29, 2005, reversed and set aside the NLRC decision and resolution.
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The appellate court found the statements of petitioners witnesses bereft of probative value, there being no clear showing when, where, to and before whom those statements were made, aside from the fact that they were not sworn to before a notary public. As for the audit report of September 19, 2001, the appellate court noted that it failed to state that respondents were responsible for the reported irregularities; and that the procedures on valid dismissals laid down by the Labor Code and the companys Code of Conduct were not religiously followed. Passing on the status of employment of respondents Palermo, Pangilinan, Lacson, Deang and De Guzman who were hired from August 1997 to January 1999, the appellate court held that having served the company for more than a year, they should be considered regular employees, their positions as cashier, receptionist, and waiters being reasonably necessary to the companys usual business. The appellate court held, however, that the award of moral and exemplary damages, attorneys fees and costs of suit was not in accord with law and jurisprudence in the absence of proof that the dismissal was attended by fraud or bad faith. Petitioners were thus ordered to reinstate respondents to their former positions without loss of seniority rights and other privileges and to pay them their full back wages, allowances, and other benefits computed from the time their compensation was withheld up to the time of their actual reinstatement. WHEREFORE, the petition is granted, and the resolutions of the public respondent NLRC dated September 30, 2003 and April 28, 2004 are hereby reversed and set aside. Accordingly, petitioners are ordered reinstated to their respective former positions without loss of seniority rights and other privileges, and to their full backwages, inclusive of allowances, and to their other benefits or monetary equivalent computed from the time their compensation was withheld from them up to the time of their actual reinstatement. No pronouncement as to the costs. Their Motion for Reconsideration having been denied by the appellate court, petitioners lodged the present petition which hinges on the sufficiency of evidence of a valid dismissal. Amid these conflicting findings, which circumstance is a recognized exception to the general rule that only questions of law may be entertained in a petition for review on certiorari, this Court is constrained to re-examine the sufficiency of the evidence proffered by petitioners in dismissing respondents.
It is a well-established rule that the employer has the burden of proving a valid dismissal of an employee, for which two requisites must concur: (a) the dismissal must be for any of the causes expressed in the Labor Code; and (b) the employee must be accorded due process, basic of which is the opportunity to be heard and to defend himself. To establish a just or authorized cause for dismissal, substantial evidence or "such amount of relevant evidence which a reasonable mind might accept as adequate to justify a conclusion" is required. Further required is that an employee sought to be dismissed must be served two written notices before the termination of his employment. The first notice must apprise him of the particular acts or omissions upon which his dismissal is grounded; the second, to inform him of the employers decision to terminate his employment. While the failure of the employer to comply with these notice requirements does not make the dismissal illegal as long as a just or authorized cause has been proved, it renders the employer liable for payment of damages because of the violation of the workers right to statutory due process. Section 3 of Rule V of the New Rules of Procedure of the NLRC, which governs the proceedings before the Labor Arbiter, provides: Section 3. Submission of Position Papers/Memorandum. Should the parties fail to agree upon an amicable settlement, either in whole or in part, during the conferences, the Labor Arbiter shall issue an order stating therein the matters taken up and agreed upon during the conferences and directing the parties to simultaneously file their respective verified position papers. These verified position papers shall cover only those claims and causes of action raised in the complaint excluding those that may have been amicably settled, and shall be accompanied by all supporting documents including the affidavits of their respective witnesses which shall take the place of the latters direct testimony. The parties shall thereafter not be allowed to allege facts, or present evidence to prove facts, not referred to and any cause or causes of action not included in the complaint or position papers, affidavits and other documents . . . (Emphasis and underscoring supplied) Section 9 of the same Rule states that "proceedings before a Labor Arbiter shall be non-litigious in nature" and that "subject to the requirements of due process, the technicalities of law and procedure and the rules obtaining in the courts of law shall not strictly apply thereto." It is sufficient that the documents submitted by the parties have a bearing on the issue at hand and support the positions taken by them. In light of the afore-quoted provisions, there was no necessity for the statements of Balen and Malana to be sworn to before a notary public or that the said witnesses be presented in person
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before the Labor Arbiter. For the statements to be of probative value, however, they must measure up to basic evidentiary requirements. In IBM Philippines, Inc. v. NLRC, this Court clarified that the liberality in administrative procedure "does not go so far as to justify orders without a basis in evidence having rational probative value." And in Uichico v. National Labor Relations Commission, it held: x x x It is true that administrative and quasi-judicial bodies like the NLRC are not bound by technical rules of procedure in the adjudication of cases. However, this procedural rule should not be construed as a license to disregard certain fundamental evidentiary rules. While the rules of evidence prevailing in courts of law or equity are not controlling in the proceedings before the NLRC, the evidence presented before it must at least have a modicum of admissibility for it to be given some probative value. x x x. (Emphasis and underscoring supplied) In the instant case, only photocopies of the statements of Balen and Malana form part of the records despite petitioners reliance thereon to prove respondents purported transgressions. Jarcia Machine Shop and Auto Supply, Inc. v. NLRC held that the unsigned photocopies of daily time records (DTRs), which were presented by the therein employer to show that its employee was neglectful of his duties, were of "doubtful or dubious probative value." Indeed, the DTRs annexed to the present petition would tend to establish private respondents neglectful attitude towards his work duties as shown by repeated and habitual absences and tardiness and propensity for working undertime for the year 1992. But the problem with these DTRs is that they are neither originals nor certified true copies. They are plain photocopies of the originals, if the latter do exist. More importantly, they are not even signed by private respondent nor by any of the employers representatives x x x. Likewise, although Balen and Malanas statements bore their signatures, they are wanting in material particulars, the most glaring of which are the dates of execution. Understandably, respondents objected to their admission, they claiming that the statements were presented only after their cases for illegal dismissal were filed before the Labor Arbiter. In Balens statement, his name was hand printed on the first page thereof on the space provided therefor, but the spaces intended for the date and the witnesses were left blank. The purported transcript of Malanas 15-page question-and-answer testimony, on the other hand, while bearing his hand printed name and signature at the top rightmost margin of the first page and on every page thereafter, merely indicated the person making the inquiry with the initials "TLG." While the initials may have referred to Theresa L. Gaddi, manager of the HRD, this point was never clarified by petitioners, hence, it remains in the realm of speculation and surmises. Neither
were the omissions as to date and other particulars rectified. The appellate courts discrediting of the statements as bereft of rational probative value upon which a decision or order may properly be based is thus well-taken. Respecting the audit report, petitioners posit that the therein mentioned documented incidentsbases of faulting respondents were so numerous to have been incurred in the normal course of business. It added that the statements of Balen and Malana regarding the alleged wrongdoings of respondents who had possession of the accountable forms were corroborated by the audit report. It bears noting that while the audit report covered a 20-month period (January 2000 to August 31, 2001), respondents had served only partly in the restaurants Glorietta branch due to the companys practice of rotating employees every so often. For that matter, respondents Quiambao and Obien were assigned to the same branch in March and August of 2000, respectively; Deang and Lacson, in October 2000; De Leon in April 2001; and De Guzman in June 2001 only. Respondents alleged involvement in the reported irregularities moreover appeared to be incongruent with the companys awarding them of certificates of commendation, recognition or appreciation for their invaluable service during the same period. Petitioners contention that the number of cancelled OS and receipts and the incidents of swapping dining OS with bar OS were beyond the normal course of business deserves scant attention, petitioners not having established the average figures in the ordinary course of its business. All told, neither the statements of Balen and Malana nor the audit report could support a valid ground for dismissal. It also does not help petitioners cause that they failed to follow rudiments of due process and even the rules laid down in their own Code of Conduct. Section 2 of Rule XIV of the Omnibus Rules Implementing the Labor Code specifically provides, as follows: Section 2. Standards of due process; requirements of notice. In all cases of termination of employment, the following standards of due process shall be substantially observed: 1. For termination of employment based on just causes as defined in Article 282 of the Code: (a) A written notice served on the employee specifying the ground or grounds for termination, and giving to said employee reasonable opportunity within which to explain his side;
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(b) A hearing or conference during which the employee concerned, with the assistance of counsel, if the employee so desires, is given opportunity to respond to the charge, present his evidence, or rebut the evidence presented against him; and (c) A written notice of termination served on the employee indicating that upon due consideration of all the circumstances, grounds have been established to justify his termination. x x x x (Underscoring supplied) The foregoing provision has been interpreted to mean that the written notice to the employees who stand to lose their employment must specify the particular acts or omissions constituting the grounds for their dismissal. The rule ensures that the employees are able to answer the charges and to defend themselves from imputed wrongdoings before their dismissals are ordered. A review of the charges in the Notice to Explain and Suspension of September 4, 2001 shows that most, if not all, were couched in general terms. Thus, respondents Quiambao and Obien were charged with "negligence in the performance of duties resulting to losses or damages amounting to more than P5,000.00" and "involvement in stealing in any form." On the other hand, Palermo, Lacson and De Leon were charged with "issuing /serving food or drinks without corresponding receipts or [with] tampered receipts" and "stealing in any form," while Pangilinan and De Guzman were charged with "pocketing tips intended for the group" and "stealing in any form." The charges against Deang, meanwhile, consisted of "withholding information on administrative or legal cases" and "stealing in any form." Precisely because of petitioners failure to sufficiently state the acts or omissions constituting the alleged transgressions that respondent Obien asked to be clarified of the charges against her. Because of the vagueness of the charges, it followed that respondents could only issue a general denial. The Corrective Action Report (CARE) furnished each of the respondents in accordance with the companys Code of Conduct was not any better. It did not contain the date/s when the alleged infractions were committed, the person/s who reported the same for investigation, or the signatures of the employees immediate supervisors. Petitioners did not even heed their own procedures on disciplinary actions. The only facts extant in the records are that respondents were issued above-said CARE Forms asking them to explain their alleged infractions within 48 hours; and they subsequently received notices of dismissal after they submitted their written explanations. There is, however, nothing to show that before their dismissal, respondents were informed of their immediate supervisors decision to terminate their
services, or that they were thereafter invited to an administrative investigation before the HRD manager or officer who is tasked to conduct the investigation in the presence of the employees immediate supervisor/s and the witnesses, if necessary, as provided under Section IV of the companys Code of Conduct. No record of any administrative investigation proceeding, which under the companys rules, was to be "minuted," had also been presented. Hence, only petitioners allegation that the statements of the witnesses were taken as part of the administrative investigation is before this Court. Allegations without proof do not deserve consideration. Finally, on the dismissal of Quiambao allegedly on the ground of business losses, it was incumbent upon petitioners to prove it by substantial evidence. It did not, however. In fact, Quiambao presented documents to disprove the validity of his retrenchment on that ground. For petitioners failure to discharge its burden then, this Court is constrained to hold that respondent Quiambaos dismissal was not valid. WHEREFORE, the Petition is DENIED. The challenged Decision of the Court of Appeals is AFFIRMED. SO ORDERED. G.R. No. 168988 June 19, 2007
FERNANDO G. MANAYA, petitioner, vs. ALABANG COUNTRY CLUB INCORPORATED, respondent. DECISION CHICO-NAZARIO, J.: This is a Petition for Review on Certiorari under Rule 45 of the 1997 Rules of Civil Procedure filed by Fernando G. Manaya (petitioner) assailing: (1) the Decision of the Court of Appeals in CA-G.R. SP No. 75417, dated 9 May 2005, granting the Petition of Alabang Country Club Inc. (respondent) and setting aside the Resolutions dated 30 August 2002 and 30 October 2002 of the National Labor Relations Commission (NLRC); and (2) the Resolution of the Court of Appeals dated 21 July 2005 denying petitioners Motion for Reconsideration of its earlier Decision.
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The assailed decision of the Court of Appeals reversed the Resolution of the NLRC dismissing the appeal of the respondent for failure to perfect its appeal within the statutory period. Instead, the Court of Appeals ordered the NLRC to give due course to the appeal of the respondent. The antecedent facts are: Petitioner alleged that on 21 August 1989, he was initially hired by the respondent as a maintenance helper receiving a salary of P198.00 per day. He was later designated as company electrician. He continued to work for the respondent until 22 August 1998 when the latter, through its Engineering and Maintenance Department Manager, Engr. Ronnie B. de la Cruz, informed him that his services were no longer required by the company. Petitioner alleged that he was forcibly and illegally dismissed without cause and without due process on 22 August 1998. Hence, he filed a Complaint before the Labor Arbiter. He claimed that he had not committed any infraction of company policies or rules and that he was not paid his service incentive leave pay, holiday pay and 13th month pay. He further asserted that with his more or less nine years of service with the respondent, he had become a regular employee. He, therefore, demanded his reinstatement without loss of seniority rights with full backwages and all monetary benefits due him. In its Answer, respondent denied that petitioner was its employee. It countered by saying that petitioner was employed by First Staffing Network Corporation (FSNC), with which respondent had an existing Memorandum of Agreement dated 21 August 1989. Thus, by virtue of a legitimate job contracting, petitioner, as an employee of FSNC, came to work with respondent, first, as a maintenance helper, and subsequently as an electrician. Respondent prayed for the dismissal of the complaint insisting that petitioner had no cause of action against it. In a Decision, dated 20 November 2000, the Labor Arbiter held: WHEREFORE, premises considered, complainant Fernando G. Manaya is hereby found to be a regular employee of respondent Alabang Country Club, Inc., as aforediscussed. His dismissal from the service having been effected without just and valid cause and without the due observance of due process is hereby declared illegal. Consequently, respondent Alabang Country Club, Inc. is hereby ordered to reinstate complainant to his former position without loss of seniority rights and other benefits appurtenant thereto with full backwages in the partial amount of P160,724.48 as computed by Ms. Ma. Concepcion Manliclic and duly noted by Ms. Ma. Elena L. Estadilla, OIC-CEU, NCR-South Sector which computation has been made part of the records. Furthermore, respondent Alabang Country Club, Inc. and First Staffing Network Corporation are hereby ordered to pay complainant, jointly and severally the following amounts by way of the following:
1. Service Incentive Leave 2,961.75 2. 13th Month Pay 15,401.10, and 3. Attorneys fees of ten (10%) percent of the total monetary award herein adjudged due him, within ten (10) days from receipt hereof. Respondent filed an Appeal with the NLRC which dismissed the same. In a Resolution dated 30 August 2002, the NLRC held: PREMISES CONSIDERED, instant appeal from the Decision of November 20, 2000 is hereby DISMISSED for failure to perfect appeal within the statutory period of appeal. The Decision is now final and executory. The NLRC found that respondents counsel of record Atty. Angelina A. Mailon of Monsod, Valencia and Associates received a copy of the Labor Arbiters Decision on or before 11 December 2000 as shown by the postal stamp or registry return card. Said counsel did not file a withdrawal of appearance. Instead, a Memorandum of Appeal dated 26 December 2000 was filed by the respondents new counsel, Atty. Arizala of Tierra and Associates Law Office. Reckoned from 11 December 2000, the date of receipt of the Decision by respondents previous counsel, the filing of the Memorandum of Appeal by its new counsel on 26 December 2000 was clearly made beyond the reglementary period. The NLRC held that the failure to perfect an appeal within the statutory period is not only mandatory but jurisdictional. The appeal having been belatedly filed, the Decision of the Labor Arbiter had become final and executory. Respondent filed a Motion for Reconsideration, which the NLRC denied in a Resolution dated 30 October 2002.The NLRC held that the decision of the Labor Arbiter has become final and executory on 28 November 2002; thus, Entry of Judgment, dated 8 January 2003 was issued. Respondent filed a Petition for Certiorari under Rule 65 of the Rules of Court before the Court of Appeals. In a Decision dated 9 May 2005, the Court of Appeals granted the petition and ordered the NLRC to give due course to respondents appeal of the Labor Arbiters Decision. Petitioner filed a Motion for Reconsideration which was denied by the Court of Appeals in a Resolution dated 21 July 2005. Not to be dissuaded, petitioner filed the instant petition before this Court. The issue for resolution:
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WHETHER OR NOT THE COURT OF APPEALS COMMITTED AN ERROR WHEN IT ORDERED THE NLRC TO GIVE DUE COURSE TO THE APPEAL OF RESPONDENT ALABANG COUNTRY CLUB, INCORPORATED EVEN IF THE SAID APPEAL WAS FILED BEYOND THE REGLEMENTARY PERIOD OF TEN (10) DAYS FOR PERFECTING AN APPEAL. Essentially, the issue raised by the respondent before the NLRC in assailing the decision of the Labor Arbiter pertains to the finding of the Labor Arbiter that petitioner was a regular employee of the respondent. In granting the petition, the Court of Appeals relied mainly on the case of Aguam v. Court of Appeals, where this Court held that litigation must be decided on the merits and not on technicalities. The appellate court further justified the grant of respondents petition by saying that the negligence of its counsel should not bind the respondent. The Court of Appeals gave credence to respondents claim that its lawyer abandoned the case; hence, they were not effectively represented by a competent counsel. It further held that the respondent, upon its receipt of the Decision of the Labor Arbiter on 15 December 2000, filed its appeal on 26 December 2000 through a new lawyer. The appeal filed by respondent through its new lawyer on 26 December 2000 was well within the reglementary period, 25 December 2000 being a holiday. It is axiomatic that when a client is represented by counsel, notice to counsel is notice to client. In the absence of a notice of withdrawal or substitution of counsel, the Court will rightly assume that the counsel of record continues to represent his client and receipt of notice by the former is the reckoning point of the reglementary period. As heretofore adverted, the original counsel did not file any notice of withdrawal. Neither was there any intimation by respondent at that time that it was terminating the services of its counsel. For negligence not to be binding on the client, the same must constitute gross negligence as to amount to a deprivation of property without due process. This does not exist in the case at bar. Notice sent to counsel of record is binding upon the client and the neglect or failure of counsel to inform him of an adverse judgment resulting in the loss of his right to appeal is not a ground for setting aside a judgment, valid and regular on its face. Even more, it is respondents duty as a client to be in touch with his counsel so as to be constantly posted about the case. It is mandated to inquire from its counsel about the status and progress of the case from time to time and cannot expect that all it has to do is sit back, relax and await the outcome of the case.
On this score, we hold that the notice to respondents counsel, Atty. Angelina A. Mailon on 11 December 2000 is the controlling date of the receipt of the decision. We now come to the issue of whether or not the Court of Appeals properly gave due course to the petition of the respondent before it. Of relevance is Section 1, Rule VI of the 2005 Revised Rules of the NLRC Section 1. PERIODS OF APPEAL. Decisions, resolutions or orders of the Labor Arbiter shall be final and executory unless appealed to the Commission by any or both parties within ten (10) calendar days from receipt thereof; and in case of decisions, resolutions or orders of the Regional Director of the Department of Labor and Employment pursuant to Article 129 of the Labor Code, within five (5) calendar days from receipt thereof. If the 10th or 5th day, as the case may be, falls on a Saturday, Sunday or holiday, the last day to perfect the appeal shall be the first working day following such Saturday, Sunday or holiday. No motion or request for extension of the period within which to perfect an appeal shall be allowed. Remarkably, in highly exceptional instances, we have allowed the relaxing of the rules on the application of the reglementary periods of appeal. Thus: In Ramos v. Bagasao, 96 SCRA 395, we excused the delay of four days in the filing of a notice of appeal because the questioned decision of the trial court was served upon appellant Ramos at a time when her counsel of record was already dead. Her new counsel could only file the appeal four days after the prescribed reglementary period was over. In Republic v. Court of Appeals, 83 SCRA 453, we allowed the perfection of an appeal by the Republic despite the delay of six days to prevent a gross miscarriage of justice since the Republic stood to lose hundreds of hectares of land already titled in its name and had since then been devoted for educational purposes. In Olacao v. National Labor Relations Commission, 177 SCRA 38, 41, we accepted a tardy appeal considering that the subject matter in issue had theretofore been judicially settled, with finality, in another case. The dismissal of the appeal would have had the effect of the appellant being ordered twice to make the same reparation to the appellee. We pronounced in those cases that technicality should not be allowed to stand in the way of equitably and completely resolving the rights and obligations of the parties. In all these, the Court allowed liberal interpretation given the extraordinary circumstances that justify a deviation from an otherwise stringent rule.
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Clearly, emphasized in these cases is that the policy of liberal interpretation is qualified by the requirement that there must be exceptional circumstances to allow the relaxation of the rules. Absent exceptional circumstances, we adhere to the rule that certain procedural precepts must remain inviolable, like those setting the periods for perfecting an appeal or filing a petition for review, for it is doctrinally entrenched that the right to appeal is a statutory right and one who seeks to avail oneself of that right must comply with the statute or rules. The rules, particularly the requirements for perfecting an appeal within the reglementary period specified in the law, must be strictly followed as they are considered indispensable interdictions against needless delays and for orderly discharge of judicial business. Furthermore, the perfection of an appeal in the manner and within the period permitted by law is not only mandatory but also jurisdictional and the failure to perfect the appeal renders the judgment of the court final and executory. Just as a losing party has the right to file an appeal within the prescribed period, the winning party also has the correlative right to enjoy the finality of the resolution of his/her case. In this particular case, we adhere to the strict interpretation of the rule for the following reasons: Firstly, in this case, entry of judgment had already been made which rendered the Decision of the Labor Arbiter as final and executory. Secondly, it is a basic and irrefragable rule that in carrying out and in interpreting the provisions of the Labor Code and its implementing regulations, the workingmans welfare should be the primordial and paramount consideration. The interpretation herein made gives meaning and substance to the liberal and compassionate spirit of the law enunciated in Article 4 of the Labor Code that "all doubts in the implementation and interpretation of the provisions of the Labor Code including its implementing rules and regulations shall be resolved in favor of labor." In the case of Bunagan v. Sentinel we declared that: [T]hat the perfection of an appeal within the statutory or reglementary period is not only mandatory, but jurisdictional, and failure to do so renders the questioned decision final and executory and deprives the appellate court of jurisdiction to alter the final judgment, much less to entertain the appeal. The underlying purpose of this principle is to prevent needless delay, a circumstance which would allow the employer to wear out the efforts and meager resources of the worker to the point that the latter is constrained to settle for less than what is due him. This Court has declared that although the NLRC is not bound by the technical rules of procedure and is allowed to be liberal in the interpretation of the rules in deciding labor cases, such liberality should not be applied where it would render futile the very purpose for which the principle of liberality is adopted. The liberal interpretation stems from the mandate that the workingmans welfare should
be the primordial and paramount consideration. We see no reason in this case to waive the rules on the perfection of appeal. The Court is aware that the NLRC is not bound by the technical rules of procedure and is allowed to be liberal in the interpretation of rules in deciding labor cases. However, such liberality should not be applied in the instant case as it would render futile the very purpose for which the principle of liberality is adopted. The liberal interpretation in favor of labor stems from the mandate that the workingmans welfare should be the primordial and paramount consideration. x x x. (Emphases supplied.) Indeed, there is no room for liberality in the instant case "as it would render futile the very purpose for which the principle of liberality is adopted." As so rightfully enunciated, "the liberal interpretation in favor of labor stems from the mandate that the workingmans welfare should be the primordial and paramount consideration." This Court has repeatedly ruled that delay in the settlement of labor cases cannot be countenanced. Not only does it involve the survival of an employee and his loved ones who are dependent on him for food, shelter, clothing, medicine and education; it also wears down the meager resources of the workers to the point that, not infrequently, they either give up or compromise for less than what is due them. Without doubt, to allow the appeal of the respondent as what the Court of Appeals had done and remand the case to the NLRC would only result in delay to the detriment of the petitioner. In Narag v. National Labor Relations Commission, citing Vir-Jen Shipping and Marine Services, Inc. v. National Labor Relations Commission, we held that delay in most instances gives the employers more opportunity not only to prepare even ingenious defenses, what with well-paid talented lawyers they can afford, but even to wear out the efforts and meager resources of the workers, to the point that not infrequently the latter either give up or compromise for less than what is due them. Nothing is more settled in our jurisprudence than the rule that when the conflicting interest of loan and capital are weighed on the scales of social justice, the heavier influence of the latter must be counter-balanced by the sympathy and compassion the law must accord the under-privileged worker. Thirdly, respondent has not shown sufficient justification to reverse the findings of the Labor Arbiter as affirmed by the NLRC. Pertinent provision of the Labor Code provides: ART. 223. APPEAL. Decisions, awards, or orders of the Labor Arbiter are final and executory unless appealed to the Commission by any or both parties within ten (10) calendar days from
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receipt of such decisions, awards, or orders. Such appeal may be entertained only on any of the following grounds: (a) If there is prima facie evidence of abuse of discretion on the part of the Labor Arbiter; (b) If the decision, order or award was secured through fraud or coercion, including graft an corruption; (c) If made purely on question of law; and (d) If serious errors in the finding of facts are raised which would cause grave or irreparable damage or injury to the appellant. Under the above provision, to obtain a reversal of the decision of the Labor Arbiter, the respondent must be able to show in his appeal that any one of the above instances exists. Respondent failed to show the existence of any of the above. A more than perfunctory reading of the Decision of the Labor Arbiter shows that the same is supported by the evidence on record. Respondent narrates that it had a contract of services, first, with Supreme Construction (Supreme). Supreme assigned petitioner to work with the respondent starting as a painter and moving on to perform electrical jobs. Respondent terminated its contract with Supreme and entered into another contract of services with another job-contracting agency, First Staffing Network Corporation. Petitioner continued to work for the respondent which claimed that the former was supplied by FNSC to it as part of its contract to supply the manpower requirements of the respondent. Petitioner is not the employee of the respondent. He was directly hired first by Supreme then later by FNSC and deployed to work with the respondent based on the contract of services between respondent and these job-contracting agencies. All these considered, respondent insists that petitioner is therefore not its employee. We do not agree to this submission of the respondent. The Labor Arbiter concluded otherwise and this finds support from the evidence, thus: [R]espondent was not able to convincingly disprove complainants claims that at the outset, he was directly hired by it as a maintenance helper on 21 August 1989. Although said respondent alleges that complainant was hired by its job contractor, Supreme Construction, it failed to submit in evidence the Contract of Service it had entered into in order to establish the entry of complainant as deployed by said company for his duties at Alabang Country Club, Inc. pursuant to the said Agreement. It can therefore be readily presumed that said respondent did not produce the said document because the production of the same will readily prove complainants assertion of having
been hired long before said contractor Supreme Construction entered into the picture. We have noted complainants admission of having been later coerced to sign up with said Supreme Construction by respondent Alabang Country Club, Inc. which he did as he was told in his fear of losing his job. As shown by respondent Alabang Country Club, Inc.s own evidence, it later terminated its contract of service or Memorandum of Agreement with Supreme Construction and entered into a new contract of service with respondent First Staffing Network Corporation effective on 16 June 1994. However by said respondents own allegation, even with the absence of complainants supposed direct employer Supreme Construction, he still remained in its employ until he signed up with respondent First Staffing Network Corporation on 11 February 1996. This indeed runs counter to the normal course of human experience such that when a contractor losses (sic) his contract of service he packs up along with all his employees, but in this case, complainant was not terminated from the service notwithstanding the expiration/termination of the contract of service of his alleged direct employer. Complainant remained working with respondent Alabang Country Club, Inc. despite the severance of the contractual relations between itself and Supreme Construction. The initial Memorandum of Agreement entered into by respondents Alabang Country Club, Inc. and First Staffing Network Corporation was dated, 16 June 1994, and was apparently renewed thereafter providing under Article III On Compensation thereof, the following, viz: "3.01 For and in consideration of the performance by FIRST STAFFING of its obligations under this AGREEMENT, the CLIENT agrees to pay the former based on the schedule of billing rates which shall be specified in the Personnel Requisition Form signed by the CLIENT. The schedule of billing rates is as follows, to wit: "BILLING RATES/HOUR PLUS 10% VALUE ADDED TAX "Covered Pos. ABC Waiters Accounting Supervisor Janitors Data Encoders Bag Boy Gen. Clerks Stewards Secretary
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Cook Helpers Receptionist Messengers Secretary Cashier" "xxx." Nowhere, does complainants position of electrician appear as covered in the said contract. Finally, suffice it for Us to stress that the said contract covers almost all of respondents Alabang Country Club, Inc.s workforce including those whose jobs or activities are directly related to said respondents business, emphasizing in no uncertain terms that respondent First Staffing Network Corporation was not a truly bonafide job contractor, as it did not contract out specific service but merely supplied work personnel, a clear indication, that it was engaged in a "job only" contracting which is prohibited by law. Besides, the said respondent First Staffing Network Corporation failed to prove that it is a bonafide job contractor by showing that it had an adequate capital or investment in tools, equipments and machineries and premises for that matter, and so did respondent Alabang Country Club, Inc. fail to establish the same. For that matter, respondent First Staffing Network Corporation had waived its right to present any evidence in its favor in this case. Obviously, herein respondent Alabang Country Club, Inc. actually resorted to contracting out all the positions for its workforce in violation of law in its desire to circumvent said employees rights as regular employees under the law. The existence of an employer-employee relationship between petitioner and respondent is fortified by the fact that during his stint with the respondent, petitioner was given the opportunity to attend a seminar/training on refrigeration and air conditioning from 16 January 1995 to 18 February 1995. A certificate of participation signed by three of respondents officials was issued to the petitioner. Equally significant is Article 106 of the Labor Code, as amended, which provides that legitimate job contracting is permitted, but labor-only contracting is prohibited. The said provision reads: Art. 106. Contractor or subcontractor. Whenever an employer enters into a contract with another person for the performance of the formers work, the employees of the contractor and of the latters subcontractor, if any, shall be paid in accordance with the provisions of this Code.
In the event that the contractor or subcontractor fails to pay the wages of his employees in accordance with this Code, the employer shall be jointly and severally liable with his contractor or subcontractor to such employees to the extent of the work performed under the contract, in the same manner and extent that he is liable to employees directly employed by him. The Secretary of Labor may, by appropriate regulations, restrict or prohibit the contracting out of labor to protect the rights of workers established under the Code. In so prohibiting or restricting, he may make appropriate distinctions between labor only contracting and job contracting as well as differentiations within these types of contracting and determine who among the parties involved shall be considered the employer for purposes of this Code, to prevent any violation or circumvention of any provision of this Code. There is "laboronly" contracting where the person supplying workers to an employer does not have substantial capital or investment in the form of tools, equipment, machineries, work premises, among others, and the workers recruited and placed by such person are performing activities which are directly related to the principal business of such employer. In such cases, the person or intermediary shall be considered merely as an agent of the employer who shall be responsible to the workers in the same manner and extent as if the latter were directly employed by him. Rule VIII-A, Book III of the Omnibus Rules Implementing the Labor Code, as amended by Department Order No. 18, distinguishes between legitimate and labor only contracting: Section 3. Trilateral Relationship in Contracting Arrangements. - In legitimate contracting, there exists a trilateral relationship under which there is a contract for a specific job, work or service between the principal and the contractor or subcontractor, and a contract of employment between the contractor and subcontractor and its workers. Hence, there are three parties involved in these arrangements, the principal which decides to farm out a job or service to a contractor or subcontractor, the contractor or subcontractor which has the capacity to independently undertake the performance of the job, work or service, and the contractual workers engaged by the contractor or subcontractor to accomplish the job, work or service. Section 5. Prohibition against laboronly contracting. Labor-only contracting is hereby declared prohibited. For this purpose, labor only contracting shall refer to an arrangement where the contractor or subcontractor merely recruits, supplies or places workers to perform a job, work or service for a principal, and any of the following elements are present: i) The contractor or subcontractor does not have substantial capital or investment which relates to the job, work or service to be performed and the employees recruited, supplied or placed by such contractor or subcontractor are performing activities which are directly related to the main business of the principal, or
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ii) The contractor does not exercise the right to control over the performance of the work of the contractual employee. The foregoing provisions shall be without prejudice to the application of Article 248(c) of the Labor Code, as amended. "Substantial capital or investment" refers to capital stocks and subscribed capitalization in the case of corporations, tools, equipments, implements, machineries and work premises, actually and directly used by the contractor or subcontractor in the performance or completion of the job, work or service contracted out. The "right to control" shall refer to the right reserved to the person for whom the services of the contractual workers are performed, to determine not only the end to be achieved, but also the manner and means to be used in reaching that end. The test to determine the existence of independent contractorship is whether one claiming to be an independent contractor has contracted to do the work according to his on methods and without being subject to the control of the employer, except only as to the results of the work. In legitimate labor contracting, the law creates an employer-employee relationship for a limited purpose, i.e., to ensure that the employees are paid their wages. The principal employer becomes jointly and severally liable with the job contractor, only for the payment of the employees wages whenever the contractor fails to pay the same. Other than that, the principal employer is not responsible for any claim made by the employees. Despite respondents disavowal of the existence of the employer-employee relationship between it and petitioner and its insistence that petitioner is an employee first, of Supreme and subsequently, of FSNC, the totality of the facts and surrounding circumstances of the case convey otherwise. On this point, the law is clear-cut. In laboronly contracting, the statute creates an employer employee relationship for a comprehensive purpose: to prevent a circumvention of labor laws. The contractor is considered merely an agent of the principal employer and the latter is responsible to the employees of the laboronly contractor as if such employees had been directly employed by the principal employer. The Labor Code and its implementing rules empower the Labor Arbiter to be the trier of facts in labor cases. Much reliance is placed on findings of facts of the Arbiter having had the opportunity to talk to and discuss with the parties and their witnesses the factual matters of the case during the conciliation phase. We, thus, give full credence to the findings of facts of the labor arbiter.
Wherefore, premises considered, the Petition is GRANTED. The Decision of the Court of Appeals dated 9 May 2005 and its Resolution dated 21 July 2005 is REVERSED. The Decision of the Labor Arbiter dated 20 November 2000 is reinstated. Let the records of the above-entitled case be remanded to the Labor Arbiter for immediate execution of the Decision. No costs. SO ORDERED. G.R. No. 175460 April 14, 2008
METRO TRANSIT ORGANIZATION, INC., and JOSE L. CORTEZ, JR., petitioners, vs. PIGLAS NFWU-KMU, SAMMY MALUNES, ROMULO QUIGAO, RODULFO CAMERINO, BRENDO MAKILING, MAXIMO VITANGCOL, PETER DIA, ELMER BOBADILLA, NOEL ESGASANE, ISIDRO CORTEZ, CRISPIN YAPCHIONGCO, MARLON E. SANTOS, WILFREDO DE RAMOS, ARTEMIO SALIG, AGRIFINO GOROSPE, RUEL MAGBALANA, JOEL MARANO, MELCHOR ALARCON, ROMEO TAGUID, EMERSON LUMABI, ATILANO JOB, DENNIS T. CRUZ, ARNOLD DIMALANTA, CARLITO MANZANILLA, GUILLERMO DUMAN, CRISANTO S. MAGNAYE, RONALDO ESTRELLA, EDMUNDO QUEMADA, MARITO N. HEBREO, EDGARDO C. RAMOS, VICTOR G. BABIERA, EDMUNDO B. GONZALEZ, ROSELL VILLANUEVA, FLORIFE BLAS, JAIME ABULENCIA, RODOLFO GAMBOA, VALENTIN BORBON, ALAN ATURBA, TEOFANES TESIOMA, PEDRO TESIOMA, CESAR BATTUNG, EDWIN ENRIQUEZ, RODOLFO PILAFIL, ARIEL BUSTAMANTE, CRISENDO CASAS, RONALD LOVEDOREAL, VICENTE RAMIREZ, GERARDO DE GUZMAN, ROBINSON VINZON, ELPIDIO P. VARGAS, LC DELA CRUZ, ARIEL DIMAWALA, JOEY A. LOBERIANO, REYNALDO S. DEL ROSARIO, PAUL V. LEGASPI, EDUARDO C. SANTOS, JOHN R. NUNEZ, JUSTINO B. ASAYTANO, JR., RONALD G. DECOSTO, JOENEL G. BALIGUAT, RUTCHIE R. RELIMBO, BENJAMIN A. ABIDIN, ALLAN CORTEZ, ALEJANDRO M. DIAZ, ANTONIO BALANGUE, RICARDO G. DALUNSONG, ERWIN S. BARRERA, ALLAN M. MARANG, PONCIANO M. ZAMORA, APOLINARIO M. BOLGEN, ARNOLD B. ESTORES, RUBEN BERNAL, ROLANDO B. CANLAS, RODOLFO C. HERESE, ANTONIO VILLAMOR, JR., ARTHUR B. HERMITANIO, HERNANI M. LIBANTING, ALBERTO T. DELA CRUZ, JEREMIAH V. MAHINAY, HELEN P. DIOLANDA, PAMPILO R. BALASBAS, EDUARDO G. MANOSCA, NATALIA PAYONGAYONG, JOHN M. BISCOCHO, DESIDERIO S. MOSQUEDA, GIOVANNI V. MUESCAN, M. MAUR A. MENDELEVAR, ORLANDO MALAYBA, ROLANDO DE GUZMAN, EDGAR V. VICELLAJE, JOEL G. EVANGELISTA, REYNALDO C. VERANO, CYRILL MAYOR, JOEY J. SABANAL, JONNY L. IGNACIO, JESUS C. FAJARDO, LEOPOLDO CAZENAS, ANASTACIO JANAVAN, VIRGILO C. CRUZ, EDGARDO ESPINOSA, ROMEO MIRAFUENTE, EDWIN R. JUAT, RENATO TAPALLA, EDWARD F. MARIANO, JESSIE A. DUQUE, MANUEL M. FLOGIO, RODRIGO SARASUA, EDWARD M. DIAZ, TEOFILO RIZ MOCORRO, JR., CESAR CUENCO, JR., ARIEL MAGNO, NEPTALI PASADAS, MAURICIO DELA CRUZ, WILHEMINE POLINTAN, DANIEL F. IJIRAN, DELIA O. CUPCUPIN, BERNARDINO G. MATIAS, DANILO B. MARIANO, JOSELITO G. CONCIO, RAMON CAQUIAT, RICARDO B. ANO, JR., LAWRENCE SACDALAN, MICHAEL GUINTO, RAYMUNDO LITAN, JR., EUCLIDA GAURANO, GENEROSO
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RAPOSA, RICARDO SANTOS, ROLANDO PEREZ, EXEJESON EVA RUAZOL, EDUARDO ROQUE, RONALDO GELLE, RHODELIO G. CRUZ, RONNIE M. GONZALES, ELIZALDE JANAPIN, EDWIN BORJA, RENIERO L. GAKO, REYNALDO T. IGNACIO, JOSE A. CENIDONIA, GLECIRIO M. SAYAT, ROGELIO LUMABAN, LARRY ORATE, SANTIAGO CLARIN, ANTONIO LEGASPI, MARILYN BRAVO, EDUARDO AGUILA, DANA KINGKING, TERESITA VELASQUEZ, AURELIO PAGTAKHAN, ALBERTO BRAVO, DONALD REYES, REINERIO RIPAY, ALFONSO TRINIDAD, JR., CESAR CANETE, SILVESTRE ALVANO, JOSEPH RODRIGUEZ, HAROLD FLORES, MICAHEL ROMBLON, RAMON AMEGLEO, PASCUAL PARAGAS, VICTOR SANCHEZ, ESTHELA ATIENZA, ANTONY DE LUNA, AGNES DELA CRUZ, CLARYMAR ESTOQUE, FELIX ARRIOLA, CARLOS SAMONTE, MEDWIN MESINA, REGGIE FELIXMENIA, RICARDO EVANGELISTA, EDISON JOSE DORDAS, LORNA SALON, LELIBETH CASINO, GREGORIO SALVEDIA, AQUILINO EBEN, RESTITUTO FELIPE, NELFRED DELETINA, FERNANDO MALLARI, RAMIR GORDO, CARLOS BANDILLA, ERNESTOR SERENA, MATEO HAO, RONILO DE VERA, ALBERTO ASIS, JR., JAIME BARCOMA, WILLIAM VILLANUEVA, ARMANDO NODADO, ENRIQUE ESPANOL, JR., FRANCISCO FLORES, ELMER CRUZ, DANILO YU, ENRIQUE FLORES, JAYSON LIWAG, ROMEO PALAGANAS, EDUARDO BERBA, MELCHOR REGALADO, REDEN NOLASCO, MARIO S. DELA CRUZ, ARNOLD MENDOZA, DANTE MENDOZA, LARRY TAN, LARRY HERNANDEZ, GODOFREDO BEUNO, MANOLO SANTOS, RICARDO PATRIARCA, ALBERTO RAMOS, ARNULFO DE LARA, WILFREDO BANDIALA, LOVIN DE LIMA, GEORGE DELA CUEVA, NELSO LABAYO, EDITHA DELA ROSA, ELIZABETH REYES, EDMUNDO LIONGSON, JR., DANILO RIVERA, SR., BENJAMIN CANDOLE, CATALINO MELEGRITO, respondents. DECISION CHICO-NAZARIO, J.: Assailed in the instant Petition for Review on Certiorari under Rule 45 of the 1997 Rules of Civil Procedure is the Resolution dated 24 August 2006 of the Court of Appeals in CA-G.R. SP. No. 95665, as well as its Resolution dated 14 November 2006 dismissing petitioners Motion for Reconsideration thereof. Petitioner Metro Transit Organization, Inc. (MTO) is a government owned and controlled corporation which entered into a Management and Operations Agreement (MOA) with the Light Rail Transit Authority (LRTA) for the operation of the Light Rail Transit (LRT) BaclaranMonumento Line. Petitioner Jose L. Cortez, Jr. was sued in his official capacity as then Undersecretary of the Department of Transportation and Communications and Chairman of the Board of Directors of petitioner MTO. For purposes of collective bargaining agreement (CBA), petitioner MTOs rank and file employees formed the Pinag-isang Lakas ng Manggagawa sa Metro, Inc.-National Federation of Labor
(PIGLAS). Meanwhile, its managerial and supervisory employees created their own union bearing the name Supervisory Employees Association of Metro (SEAM). Petitioners MTO and PIGLAS entered into a CBA covering the period of 13 February 1995 to 13 February 2000. SEAM similarly negotiated with petitioner MTO under a separate CBA. Allegedly disgruntled with PIGLAS, some rank and file employees formed another union under the umbrella of the Philippine Transport Group Workers Organization-Trade Union Congress of the Philippines (PTGWO-TUCP), which negotiated with management for certification as the new bargaining agent. The aforesaid intra-union dispute was settled through a certification election which PIGLAS won. Thereafter, PIGLAS renegotiated the CBA demanding higher benefits. On 25 July 2000, due to a bargaining deadlock, PIGLAS filed a Notice of Strike before the National Conciliation and Mediation Board (NCMB). On the same date, PIGLAS staged a strike. Consequently, Hon. Bienvenido E. Laguesma, then Secretary of the Department of Labor and Employment (DOLE), issued an Order of Assumption of Jurisdiction/Return to Work, dated 25 July 2000, directing the striking employees to immediately return to work, and petitioner MTO to take them back under the same terms and conditions of employment prevailing prior to the strike. The Order of Assumption of Jurisdiction/Return to Work was published in newspapers of general circulation. The striking employees refused to receive a copy of said Order; hence, copies thereof were posted in the stations and terminals of the LRT. The striking PIGLAS members refused to accede to the Return to Work Order. Following their continued non-compliance, on 28 July 2000, the LRTA formally informed petitioner MTO that it had issued a Board Resolution which: (1) allowed the expiration after 31 July 2000 of LRTAs MOA with petitioner MTO; and (2) directed the LRTA to take over the operations and maintenance of the LRT Line. By virtue of said Resolution, petitioner MTO sent termination notices to its employees, including herein respondents. Resultantly, respondents filed with the Labor Arbiter Complaints against petitioners and the LRTA for the following: (1) illegal dismissal; (2) unfair labor practice for union busting; (3) moral and exemplary damages; and (4) attorneys fees. On 13 September 2004, the Labor Arbiter rendered judgment in favor of respondents. The decretal portion of the Labor Arbiters Decision, states: WHEREFORE, premises considered, judgment is hereby rendered declaring the dismissal of the complainants as illegal and ordering respondents Metro Transit Organization, Inc. and Light Rail Transit Authority to jointly and severally pay complainants their separation pay and backwages in the amounts indicated opposite their respective names as shown in Annexes "A" to "A-5" of this decision or in the total amount of P208,235,682.72.
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Respondents are further ordered to pay the sum equivalent to ten (10%) percent of the judgment award as and by way of attorneys fees or in the amount of P20,823,568.27. The claim of complainant Ronald Lovedoreal is ordered dismissed without prejudice. All other claims are ordered dismissed for lack of merit. Petitioners appealed to the National Labor Relations Commission (NLRC). In a Resolution dated 19 May 2006, the NLRC dismissed petitioners appeal for non-perfection since it failed to post the required bond. The NLRC ratiocinated: Section 6, Rule VI of the Rules of Procedure of the National Labor Relations Commission, as amended by Resolution No. 01-02, Series of 2002 provides, to wit: "SECTION 6 BOND. In case the decision of the Labor Arbiter or the Regional Director involves a monetary award, an appeal by the employer may be perfected only upon the posting of a cash or surety bond. The appeal bond shall either be in cash or surety in an amount equivalent to the monetary award, exclusive of damages and attorneys fees." In this case [petitioners] filed a property bond, and applying a liberal interpretation of the above Rule and finding support in the Supreme Court pronouncement in the case of UERMMemorial Medical Center, et al. vs. NLRC, et al., G.R. No. 110419, March 3, 1997, we conditionally accepted the property bond subject to the submission of the requirements specified in the Order. Moreover, [petitioners] were directed to comply with the requirements within ten (10) days from receipt of the Order with a warning that failure to comply will result in the dismissal of the appeal for non-perfection thereof. It appears that to date, which is more than a month from receipt of the Order, [petitioners] failed to comply with the conditions required in the posting of the property bond, this Commission is therefore constrained to dismiss the appeal for non-perfection thereof. The NLRC thus disposed: WHEREFORE, premises considered, an order is hereby issued DISMISSING the appeal of [petitioners] for non-perfection thereof and the Decision dated 13 September 2004 has become final. The Motion for Reconsideration filed by complainants-appellees and the motion to suspend proceedings filed by [petitioners] are both DENIED for lack of merit.
No further motion of similar nature shall be entertained. Without filing a Motion for Reconsideration of the afore-quoted NLRC Resolution, petitioners filed a Petition for Certiorari with the Court of Appeals assailing the same. On 24 August 2006, the Court of Appeals issued a Resolution dismissing the Petition. It ruled: The petitioners have filed this petition for certiorari against the resolution of the NLRC dated May 19, 2006 dismissing the appeal for non-perfection. They have not, however, filed a motion for reconsideration of the ruling prior to filing the petition. This renders the petition fatally defective. The motion for reconsideration has been held to be a condition sine qua non for certiorari, the rationale being that the lower court should be given the opportunity to correct its error before recourse to the higher court is made. [Yau] vs. Manila Banking Corp. 384 SCRA 340. The [acknowledged] exceptions to the rule find no application here. The order of dismissal is issued by the NLRC in the exercise of its discretionary authority to fix the requirements of the property bond for appeal, and the finding that the petitioners failed to perfect the appeal for non-compliance with these conditions is both a factual and legal issue. We have a perfect textbook example of an order that is amenable to a motion for reconsideration. Petitioners moved for the reconsideration of the appellate courts dismi ssal of its Petition. The Court of Appeals, however, in a Resolution dated 14 November 2006 found no cogent reason to disturb its original conclusions. Hence, petitioners come to this Court, challenging the dismissal by the Court of Appeals of its Petition. It must be primarily established that petitioners contravened the procedural rule for the extraordinary remedy ofcertiorari. The rule is, for the writ to issue, it must be shown that there is no appeal, nor any plain, speedy and adequate remedy in the ordinary course of law. The settled rule is that a motion for reconsideration is a condition sine qua non for the filing of a petition forcertiorari. Its purpose is to grant an opportunity for the court to correct any actual or perceived error attributed to it by the re-examination of the legal and factual circumstances of the case. The rationale of the rule rests upon the presumption that the court or administrative body which issued the assailed order or resolution may amend the same, if given the chance to correct its mistake or error. We have held that the "plain," "speedy," and "adequate remedy" referred to in Section 1, Rule 65 of the Rules of Court is a motion for reconsideration of the questioned Order or Resolution. As we
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consistently held in numerous cases, a motion for reconsideration is indispensable for it affords the NLRC an opportunity to rectify errors or mistakes it might have committed before resort to the courts can be had. In the case at bar, petitioners directly went to the Court of Appeals on certiorari without filing a motion for reconsideration with the NLRC. The motion for reconsideration would have aptly furnished a plain, speedy, and adequate remedy. As a rule, the Court of Appeals, in the exercise of its original jurisdiction, will not take cognizance of a petition for certiorari under Rule 65, unless the lower court has been given the opportunity to correct the error imputed to it. The Court of Appeals correctly ruled that petitioners failure to file a motion for reconsideration against the assailed Resolution of the NLRC rendered its petition for certiorari before the appellate court as fatally defective. We agree in the Court of Appeals finding that petitioners case does not fall under any of the recognized exceptions to the filing of a motion for reconsideration, to wit: (1) when the issue raised is purely of law; (2) when public interest is involved; (3) in case of urgency; or when the questions raised are the same as those that have already been squarely argued and exhaustively passed upon by the lower court. As the Court of Appeals reasoned, the issue before the NLRC is both factual and legal at the same time, involving as it does the requirements of the property bond for the perfection of the appeal, as well as the finding that petitioners failed to perfect the same. Evidently, the burden is on petitioners seeking exception to the rule to show sufficient justification for dispensing with the requirement. Certiorari cannot be resorted to as a shield from the adverse consequences of petitioners' own omission of the filing of the required motion for reconsideration. Nonetheless, even if we are to disregard the petitioners procedural faux pas with the Court of Appeals, and proceed to review the propriety of the 19 May 2006 NLRC Resolution, we still arrive at the conclusion that the NLRC did not err in denying petitioners appeal for its failure to file a bond in accordance with the Rules of Procedure of the NLRC. In cases involving a monetary award, an employer seeking to appeal the decision of the Labor Arbiter to the NLRC is unconditionally required by Article 223 of the Labor Code to post a cash or surety bond equivalent to the amount of the monetary award adjudged. It should be stressed that the intention of lawmakers to make the bond an indispensable requisite for the perfection of an appeal by the employer is underscored by the provision that an appeal by the employer may be perfected only upon the posting of a cash or surety bond. The word "only" makes it perfectly clear that the lawmakers intended the posting of a cash or surety bond by the employer to be the exclusive means by which an employers appeal may be perfected. Moreover, it bears stressing that the perfection of an appeal in the manner and within the period prescribed by law is not only mandatory but jurisdictional, and failure to conform to the rules will render the judgment sought to be reviewed final and unappealable. It cannot be overemphasized that the NLRC Rules, akin to the Rules of Court, promulgated by authority of law, have the force and effect of law.
As borne by the records, petitioners filed a property bond which was conditionally accepted by the NLRC subject to the following conditions specified in its 24 February 2006 Order: The conditional acceptance of petitioners property bond was subject to the submission of the following: 1) Certified copy of Board Resolution or a Certificate from the Corporate Secretary of Light Rail Transit Authority stating that the Corporation President is authorized by a Board Resolution to submit title as guarantee of judgment award; 2) Certified Copy of the Titles issued by the Registry of Deeds of Pasay City; 3) Certified Copy of the current tax declarations of Titles; 4) Tax clearance from the City Treasurer of Pasay City; 5) Appraisal report of an accredited appraisal company attesting to the fair market value of property within ten (10) days from receipt of this Order. Failure to comply therewith will result in the dismissal of the appeal for non-perfection thereof. In the same Order, the NLRC warned that failure of the petitioners to comply with the conditions would result in the dismissal of the appeal for non-perfection thereof. Petitioners were directed to comply with its given conditions within 10 days from receipt of the Order with a caveat that their failure will result in the dismissal of the appeal. Subsequently, in its 19 May 2006 Resolution, the NLRC finally made a factual finding that petitioners failed to comply with the conditions attached to their posting of the property bond. Thus, the NLRC dismissed petitioners appeal for non-perfection thereof. Essentially, the failure of petitioners to comply with the conditions for the posting of the property bond is tantamount to a failure to post the bond as required by law. What is even more salient is the fact that the NLRC had stressed that petitioners had, for more than a month from receipt of its 24 February 2006 Order, to comply with the conditions set forth therein for the posting of the property bond. It cannot be gainsaid that the NLRC had given petitioners a period of 10 days from receipt of the Order with a warning that non-compliance would result in the dismissal of their appeal for failure to perfect the same. Petitioners therefore disregarded the rudiments of the law in the perfection of their appeal. We are without recourse but to take petitioners failure against their interest. WHEREFORE, the Petition is DENIED. The Resolutions dated 24 August 2006 and 14 November 2006 of the Court of Appeals in CA-G.R. SP. No. 95665 are AFFIRMED. Costs against petitioners. SO ORDERED.
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Labor Relations Cases Atty. Nic Jimeno Set 1 Parts I-III (Course Syllabus) Hernandez, Frauline Camille R.

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