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THIRDDIVISION

BISIGMANGGAGAWASATRYCO
G.R.No.151309
and/orFRANCISCOSIQUIG,asUnion

President,JOSELITOLARIO,
Present:

VIVENCIOB.BARTE,SATURNINO
EGERAandSIMPLICIOAYAAY,
PUNO,C.J.,*
Petitioners,
YNARESSANTIAGO,J.,

Chairperson,
versus
CHICONAZARIO,

NACHURA,and
NATIONALLABORRELATIONS
REYES,JJ.
COMMISSION,TRYCOPHARMA

CORPORATION,and/orWILFREDOC. Promulgated:
RIVERA,

Respondents.
October15,2008

xx

DECISION

NACHURA,J.:

[1]
ThispetitionseeksareviewoftheDecision oftheCourtofAppeals(CA)datedJuly24,
2001andResolutiondatedDecember20,2001,whichaffirmedthefindingoftheNationalLabor
RelationsCommission(NLRC)thatthepetitionerstransfertoanotherworkplacedidnotamount
toaconstructivedismissalandanunfairlaborpractice.

Thepertinentfactualantecedentsareasfollows:

Tryco Pharma Corporation (Tryco) is a manufacturer of veterinary medicines and its

principalofficeislocatedinCaloocanCity.PetitionersJoselitoLario,VivencioBarte,Saturnino
EgeraandSimplicioAyaayareitsregularemployees,occupyingthepositionsofhelper,shipment
helper and factory workers, respectively, assigned to the Production Department. They are
members of Bisig Manggagawa sa Tryco (BMT), the exclusive bargaining representative of the
rankandfileemployees.

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[2]
TrycoandthepetitionerssignedseparateMemorand[a]ofAgreement (MOA),providing
foracompressedworkweekscheduletobeimplementedinthecompanyeffectiveMay20,1996.
TheMOAwasenteredintopursuanttoDepartmentofLaborandEmploymentDepartmentOrder
(D.O.) No. 21, Series of 1990, Guidelines on the Implementation of Compressed Workweek. As
providedintheMOA,8:00a.m.to6:12p.m.,fromMondaytoFriday,shallbeconsideredasthe
regularworkinghours,andnoovertimepayshallbedueandpayabletotheemployeeforwork
renderedduringthosehours.TheMOAspecificallystatedthattheemployeewaivestherightto
claim overtime pay for work rendered after 5:00 p.m. until 6:12 p.m. from Monday to Friday
considering that the compressed workweek schedule is adopted in lieu of the regular workweek
schedulewhichalsoconsistsof46hours.However,shouldanemployeebepermittedorrequired
toworkbeyond6:12p.m.,suchemployeeshallbeentitledtoovertimepay.

Tryco informed the Bureau of Working Conditions of the Department of Labor and
[3]
Employmentoftheimplementationofacompressedworkweekinthecompany.

InJanuary1997,BMTandTryconegotiatedfortherenewaloftheircollectivebargaining
agreement(CBA)butfailedtoarriveatanewagreement.

Meantime, Tryco received the Letter dated March 26, 1997 from the Bureau of Animal
IndustryoftheDepartmentofAgricultureremindingitthatitsproductionshouldbeconductedin
SanRafael,Bulacan,notinCaloocanCity:

MR.WILFREDOC.RIVERA
President,TrycoPharmaCorporation
SanRafael,Bulacan

Subject:LTOasVDAPManufactureratSanRafael,Bulacan

DearMr.Rivera:

ThisistoremindyouthatyourLicensetoOperateasVeterinaryDrugandProductManufactureris
addressedatSanRafael,Bulacan,andso,therefore,yourproductionshouldbedoneattheabove
mentioned address only. Further, production of a drug includes propagation, processing,
compounding,finishing,filling,repacking,labeling,advertising,storage,distributionorsaleofthe
veterinarydrugproduct.Innoinstance,therefore,shouldanyoftheabovebedoneatyourbusiness
officeat117M.PonceSt.,EDSA,CaloocanCity.

Pleasebeguidedaccordingly.

Thankyou.

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Verytrulyyours,

(sgd.)
EDNAZENAIDAV.VILLACORTE,D.V.M.
[4]
Chief,AnimalFeedsStandardDivision

[5]
Accordingly,TrycoissuedaMemorandum datedApril7,1997whichdirectedpetitioner
AyaaytoreporttothecompanysplantsiteinBulacan.WhenpetitionerAyaayrefusedtoobey,
[6]
[7]
TrycoreiteratedtheorderonApril 18, 1997. Subsequently, through a Memorandum dated
May 9, 1997, Tryco also directed petitioners Egera, Lario and Barte to report to the companys
plantsiteinBulacan.

BMT opposed the transfer of its members to San Rafael, Bulacan, contending that it
constitutesunfairlaborpractice.Inprotest,BMTdeclaredastrikeonMay26,1997.

[8]
In August 1997, petitioners filed their separate complaints for illegal dismissal,
underpaymentofwages,nonpaymentofovertimepayandserviceincentiveleave,andrefusalto
[9]
bargainagainstTrycoanditsPresident,WilfredoC.Rivera.IntheirPositionPaper, petitioners
alleged that the company acted in bad faith during the CBA negotiations because it sent
representatives without authority to bind the company, and this was the reason why the
negotiations failed. They added that the management transferred petitioners Lario, Barte, Egera
and Ayaay from Caloocan to San Rafael, Bulacan to paralyze the union. They prayed for the
company to pay them their salaries from May 26 to 31, 1997, service incentive leave, and
overtimepay,andtoimplementWageOrderNo.4.

In their defense, respondents averred that the petitioners were not dismissed but they
refusedtocomplywiththemanagementsdirectiveforthemtoreporttothecompanysplantinSan
Rafael,Bulacan.Theydeniedtheallegationthattheynegotiatedinbadfaith,statingthat,infact,
theysenttheExecutiveVicePresidentandLegalCounselasthecompanysrepresentativestothe
CBA negotiations. They claim that the failure to arrive at an agreement was due to the
stubbornnessoftheunionpanel.

Respondentsfurtheraverredthat,longbeforethestartofthenegotiations,thecompanyhad
alreadybeenplanningtodecongesttheCaloocanofficetocomplywiththegovernmentpolicyto
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shift the concentration of manufacturing activities from the metropolis to the countryside. The
decisiontotransferthecompanysproductionactivitiestoSanRafael,Bulacanwasprecipitatedby
theletterreminderoftheBureauofAnimalIndustry.

[10]
On February 27, 1998, the Labor Arbiter dismissed the case for lack of merit.
The
Labor Arbiter held that the transfer of the petitioners would not paralyze or render the union
ineffectiveforthefollowingreasons:(1)complainantsarenotmembersofthenegotiatingpanel
and(2)thetransferwasmadepursuanttothedirectiveoftheDepartmentofAgriculture.

The Labor Arbiter also denied the money claims, ratiocinating that the nonpayment of
wages was justified because the petitioners did not render work from May 26 to 31, 1997
overtimepayisnotduebecauseofthecompressedworkweekagreementbetweentheunionand
managementandserviceincentiveleavepaycannotbeclaimedbythecomplainantsbecausethey
are already enjoying vacation leave with pay for at least five days. As for the claim of
noncompliancewithWageOrderNo.4,theLaborArbiterheldthattheissueshouldbelefttothe
grievancemachineryorvoluntaryarbitrator.
OnOctober29,1999,theNLRCaffirmedtheLaborArbitersDecision,dismissingthecase,
thus:

PREMISESCONSIDERED,theDecisionofFebruary27,1998isherebyAFFIRMEDand
complainants appeal therefrom DISMISSED for lack of merit. Complainants Joselito Lario,
VivencioBarte,SaturninoEgeraandSimplicioAyaayaredirectedtoreporttoworkatrespondents
San Rafael Plant, Bulacan but without backwages. Respondents are directed to accept the
complainantsbacktowork.

[11]
SOORDERED.

On December 22, 1999, the NLRC denied the petitioners motion for reconsideration for
[12]
lackofmerit.

Leftwithnorecourse,petitionersfiledapetitionforcertiorariwiththeCA.

On July 24, 2001, the CA dismissed the petition for certiorari and ruled that the transfer
orderwasamanagementprerogativenotamountingtoaconstructivedismissaloranunfairlabor
practice. The CA further sustained the enforceability of the MOA, particularly the waiver of

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overtime pay in light of this Courts rulings upholding a waiver of benefits in exchange of other
valuableprivileges.ThedispositiveportionofthesaidCAdecisionreads:

WHEREFORE,theinstantpetitionisDISMISSED.TheDecisionoftheLaborArbiterdated
February27,1998andtheDecisionandResolutionoftheNLRCpromulgatedonOctober29,1999
andDecember22,1999,respectively,inNLRCNCRCaseNos.080571597,080611597and08
0592097,areAFFIRMED.

[13]
SOORDERED.

[14]
TheCAdeniedthepetitionersmotionforreconsiderationonDecember20,2001.

Dissatisfied,petitionersfiledthispetitionforreviewraisingthefollowingissues:

THE HONORABLE COURT OF APPEALS ERRED IN AFFIRMING THE PATENTLY

ERRONEOUSRULINGOFTHELABORARBITERANDTHECOMMISSIONTHATTHERE
WAS NO DISMISSAL, MUCH LESS ILLEGAL DISMISSAL, OF THE INDIVIDUAL
PETITIONERS.

THECOURTOFAPPEALSGRAVELYERREDINNOTFINDINGANDCONCLUDINGTHAT
PRIVATERESPONDENTSCOMMITTEDACTSOFUNFAIRLABORPRACTICE.

THE COURT OF APPEALS ERRED IN NOT FINDING AND CONCLUDING THAT

PETITIONERS ARE ENTITLED TO THEIR MONEY CLAIMS AND TO DAMAGES, AS
[15]
WELLASLITIGATIONCOSTSANDATTORNEYSFEES.

Thepetitionhasnomerit.

We have no reason to deviate from the wellentrenched rule that findings of fact of labor
officials,whoaredeemedtohaveacquiredexpertiseinmatterswithintheirrespectivejurisdiction,
are generally accorded not only respect but even finality, and bind us when supported by
[16]
substantial evidence.
This is particularly true when the findings of the Labor Arbiter, the
[17]
NLRCandtheCAareinabsoluteagreement.
Inthiscase,theLaborArbiter,theNLRC,and
the CA uniformly agreed that the petitioners were not constructively dismissed and that the
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transferordersdidnotamounttoanunfairlaborpractice.Butifonlytodisabusethemindsofthe
petitionerswhohavepersistentlypursuedthiscaseonthemistakenbeliefthatthelabortribunals
andtheappellatecourtcommittedgrievouserrors,thisCourtwillgoovertheissuesraisedinthis
petition.

Petitionersmainlycontendthatthetransferordersamounttoaconstructivedismissal.They
maintain that the letter of the Bureau of Animal Industry is not credible because it is not
authenticateditisonlyaploy,solicitedbyrespondentstogivethemanexcusetoeffectamassive
transferofemployees.TheypointoutthattheCaloocanCityofficeisstillengagedinproduction
activitiesuntilnowandrespondentsevenhirednewemployeestoreplacethem.

Wedonotagree.

WerefusetoacceptthepetitionerswildandrecklessimputationthattheBureauofAnimal
Industryconspiredwiththerespondentsjusttoeffectthetransferofthepetitioners.Thereisnotan
iota of proof to support this outlandish claim. Absent any evidence, the allegation is not only
highlyirresponsiblebutisgrosslyunfairtothegovernmentagencyconcerned.EvenasthisCourt
hasgivenlitigantsandcounselarelativelywidelatitudetopresentargumentsinsupportoftheir
cause, we will not tolerate outright misrepresentation or baseless accusation. Let this be fair
warningtocounselforthepetitioners.

Furthermore, Trycos decision to transfer its production activities to San Rafael, Bulacan,
regardless of whether it was made pursuant to the letter of the Bureau of Animal Industry, was
withinthescopeofitsinherentrighttocontrolandmanageitsenterpriseeffectively.Whilethelaw
issolicitousofthewelfareofemployees,itmustalsoprotecttherightofanemployertoexercise
what are clearly management prerogatives. The free will of management to conduct its own
[18]
businessaffairstoachieveitspurposecannotbedenied.

This prerogative extends to the managements right to regulate, according to its own
discretionandjudgment,allaspectsofemployment,includingthefreedomtotransferandreassign
[19]
employees according to the requirements of its business.
Managements prerogative of
transferringandreassigningemployeesfromoneareaofoperationtoanotherinordertomeetthe
[20]
requirementsofthebusinessis,therefore,generallynotconstitutiveofconstructivedismissal.
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Thus, the consequent transfer of Trycos personnel, assigned to the Production Department was
wellwithinthescopeofitsmanagementprerogative.

Whenthetransferisnotunreasonable,orinconvenient,orprejudicialtotheemployee,and
itdoesnotinvolveademotioninrankordiminutionofsalaries,benefits,andotherprivileges,the
employee may not complain that it amounts to a constructive dismissal.

[21]
However, the

employer has the burden of proving that the transfer of an employee is for valid and legitimate
grounds. The employer must show that the transfer is not unreasonable, inconvenient, or
prejudicialtotheemployeenordoesitinvolveademotioninrankoradiminutionofhissalaries,
[22]
privilegesandotherbenefits.

Indisputably, in the instant case, the transfer orders do not entail a demotion in rank or
diminution of salaries, benefits and other privileges of the petitioners. Petitioners, therefore,
anchor their objection solely on the ground that it would cause them great inconvenience since
they are all residents of Metro Manila and they would incur additional expenses to travel daily
fromManilatoBulacan.

The Court has previously declared that mere incidental inconvenience is not sufficient to
[23]
warrantaclaimofconstructivedismissal.
Objectiontoatransferthatisgroundedsolelyupon
the personal inconvenience or hardship that will be caused to the employee by reason of the
[24]
transferisnotavalidreasontodisobeyanorderoftransfer.

[25]
Incidentally, petitioners cite Escobin v. NLRC
where the Court held that the transfer of the
employees therein was unreasonable. However, the distance of the workplace to which the
employeeswerebeingtransferredcanhardlycomparetothatofthepresentcase.Inthatcase,the
employeeswerebeingtransferredfromBasilantoManilahence,theCourtnotedthatthetransfer
would have entailed the separation of the employees from their families who were residing in
BasilanandaccrualofadditionalexpensesforlivingaccommodationsinManila.Incontrast,the
distance from Caloocan to San Rafael, Bulacan is not considerably great so as to compel
petitionerstoseeklivingaccommodationsintheareaandpreventthemfromcommutingtoMetro
Maniladailytobewiththeirfamilies.

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Petitioners, however, went further and argued that the transfer orders amounted to unfair
laborpracticebecauseitwouldparalyzeandrendertheunionineffective.

Tobeginwith,wecannotseehowthemeretransferofitsmemberscanparalyzetheunion.
Theunionwasnotdeprivedofthemembershipofthepetitionerswhoseworkassignmentswere
onlytransferredtoanotherlocation.

More importantly, there was no showing or any indication that the transfer orders were
motivatedbyanintentiontointerferewiththepetitionersrighttoorganize.Unfairlaborpractice
referstoactsthatviolatetheworkersrighttoorganize.WiththeexceptionofArticle248(f)ofthe
Labor Code of the Philippines, the prohibited acts are related to the workers right to self
organizationandtotheobservanceofaCBA.Withoutthatelement,theacts,nomatterhowunfair,
[26]
arenotunfairlaborpractices.

Finally,wedonotagreewiththepetitionersassertionthattheMOAisnotenforceableasit
iscontrarytolaw.TheMOAisenforceableandbindingagainstthepetitioners.Whereitisshown
that the person making the waiver did so voluntarily, with full understanding of what he was
doing,andtheconsiderationforthequitclaimiscredibleandreasonable,thetransactionmustbe
[27]
recognizedasavalidandbindingundertaking.

D.O.No.21sanctionsthewaiverofovertimepayinconsiderationofthebenefitsthatthe
employeeswillderivefromtheadoptionofacompressedworkweekscheme,thus:

Thecompressedworkweekschemewasoriginallyconceivedforestablishmentswishingto
saveonenergycosts,promotegreaterworkefficiencyandlowertherateofemployeeabsenteeism,
amongothers.Workersfavortheschemeconsideringthatitwouldmeansavingsontheincreasing
cost of transportation fares for at least one (1) day a week savings on meal and snack expenses
longer weekends, or an additional 52 offdays a year, that can be devoted to rest, leisure, family
responsibilities,studiesandotherpersonalmatters,andthatitwillsparethemforatleastanother
day in a week from certain inconveniences that are the normal incidents of employment, such as
commutingtoandfromtheworkplace,traveltimespent,exposuretodustandmotorvehiclefumes,
dressingupforwork,etc.Thus,underthisscheme,thegenerallyobservedworkweekofsix(6)days
isshortenedtofive(5)daysbutprolongingtheworkinghoursfromMondaytoFridaywithoutthe
employerbeingobligedforpayovertimepremiumcompensationforworkperformedinexcessof
eight (8) hours on weekdays, in exchange for the benefits abovecited that will accrue to the
employees.

Moreover,theadoptionofacompressedworkweekschemeinthecompanywillhelptemper
anyinconveniencethatwillbecausedthepetitionersbytheirtransfertoafartherworkplace.
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Notably, the MOA complied with the following conditions set by the DOLE, under D.O.
No.21,toprotecttheinterestoftheemployeesintheimplementationofacompressedworkweek
scheme:

1.Theemployeesvoluntarilyagreetoworkmorethaneight(8)hoursadaythetotalinaweek
of which shall not exceed their normal weekly hours of work prior to adoption of the
compressedworkweekarrangement

2.Therewillnotbeanydiminutionwhatsoeverintheweeklyormonthlytakehomepayand
fringebenefitsoftheemployees

3. Ifanemployeeispermittedorrequiredtoworkinexcessofhisnormalweeklyhoursof
workpriortotheadoptionofthecompressedworkweekscheme,allsuchexcesshoursshall
beconsideredovertimeworkandshallbecompensatedinaccordancewiththeprovisionsof
theLaborCodeorapplicableCollectiveBargainingAgreement(CBA)

4.Appropriatewaiverswithrespecttoovertimepremiumpayforworkperformedinexcessof
eight(8)hoursadaymaybedevisedbythepartiestotheagreement.

5. The effectivity and implementation of the new working time arrangement shall be by
agreementoftheparties.

[28]
PESALAv.NLRC,
citedbythepetitioners,isnotapplicabletothepresentcase.Inthat
case,anemploymentcontractprovidedthattheworkdayconsistsof12hoursandtheemployee
willbepaidafixedmonthlysalaryratethatwasabovethelegalminimumwage.However,unlike
thepresentMOAwhichspecificallystatesthattheemployeewaiveshisrighttoclaimovertime
pay for work rendered beyond eight hours, the employment contract in that case was silent on
whetherovertimepaywasincludedinthepaymentofthefixedmonthlysalary.Thisnecessitated
the interpretation by the Court as to whether the fixed monthly rate provided under the
employmentcontractincludedovertimepay.TheCourtnotedthatiftheemployeeispaidonlythe
minimumwagebutwithovertimepay,theamountisstillgreaterthanthefixedmonthlyrateas
providedintheemploymentcontract.It,therefore,heldthatovertimepaywasnotincludedinthe
agreedfixedmonthlyrate.

ConsideringthattheMOAclearlystatesthattheemployeewaivesthepaymentofovertime
payinexchangeofafivedayworkweek,thereisnoroomforinterpretationanditstermsshould
beimplementedastheyarewritten.

WHEREFORE, the petition is DENIED. The Court ofAppeals Decision dated July 24,
2001andResolutiondatedDecember20,2001areAFFIRMED.
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SOORDERED.

WECONCUR:

ANTONIOEDUARDOB.NACHURA
AssociateJustice

REYNATOS.PUNO
ChiefJustice

CONSUELOYNARESSANTIAGO
MINITAV.CHICONAZARIO
AssociateJustice
AssociateJustice
Chairperson

RUBENT.REYES
AssociateJustice

ATTESTATION

IattestthattheconclusionsintheaboveDecisionwerereachedinconsultationbeforethecasewas
assignedtothewriteroftheopinionoftheCourtsDivision.

CONSUELOYNARESSANTIAGO
AssociateJustice
Chairperson,ThirdDivision

CERTIFICATION

PursuanttoSection13,ArticleVIIIoftheConstitutionandtheDivisionChairperson'sAttestation,
I certify that the conclusions in the above Decision had been reached in consultation before the
casewasassignedtothewriteroftheopinionoftheCourtsDivision.

REYNATOS.PUNO
ChiefJustice
*AdditionalmemberinlieuofAssociateJusticeMa.AliciaAustriaMartinezperRaffledatedSeptember1,2008.
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[1]
Penned by Associate Justice Ma.Alicia AustriaMartinez (now Associate Justice of the Supreme Court), withAssociate Justices
HilarionL.AquinoandJoseL.Sabio,Jr.,concurringrollo,pp.4149.

[2]
CArollo,pp.252272.
[3]
Id.at249250.
[4]
Id.at244.

[5]
Id.at246.
[6]
Id.at247.
[7]
Id.at248.
[8]
Rollo,pp.6469.
[9]
Id.at7178.

[10]
Id.at110118.
[11]
Id.at135.
[12]
Id.at161162.
[13]
Id.at48.
[14]
Id.at51.
[15]
Id.at20.
[16]
HondaPhils.,Inc.v.SamahanngMalayangManggagawasaHonda,G.R.No.145561,June15,2005,460SCRA186,191.
[17]
Domondonv.NationalLaborRelationsCommission,G.R.No.154376,September30,2005,471SCRA559,566.
[18]
HongkongandShanghaiBankingCorporationv.NLRC,346Phil.524,535(1997).
[19]
BenguetElectricCooperativev.Verzosa,468Phil.980,992(2004).
[20]
Id.at995.
[21]
Id.at996.
[22]
Tiniov.CourtofAppeals,G.R.No.171764,June8,2007,524SCRA533,541.
[23]
Duldulaov.CourtofAppeals,G.R.No.164893,March1,2007,517SCRA191,202.
[24]
MercuryDrugCorporationv.Domingo,G.R.No.143998,April29,2005,457SCRA578,592.
[25]
351Phil.973(1998).
[26]
PhilcomEmployeesUnionv.PhilippineGlobalCommunications,G.R.No.144315,July17,2006,495SCRA214,235.
[27]
LandandHousingDevelopmentCorporationv.Esquillo, G.R.No.152012,September30,2005,471SCRA488,498.
[28]
329Phil.581(1996).

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