Hijo Resources Corp vs Mijares
HIJO RESOURCES CORPORATION, Petitioner, v. EPIFANIO P. MEJARES
G.R. No. 208986, January 13, 2016
CARPIO, J.:
FACTS:
Respondents Epifanio P. Mejares, Remegio C. Baluran, Jr., Dante Saycon, and Cecilio
Cucharo (respondents) were among the complainants, represented by their labor
union named "Nagkahiusang Mamumuo ng Bit, Djevon, at Raquilla Farms sa Hijo
Resources Corporation" (NAMABDJERA-HRC), who filed with the NLRC an illegal
dismissal case against petitioner Hijo Resources Corporation (HRC). Complainants
(respondents) alleged that petitioner HRC, formerly known as Hijo Plantation
Incorporated (HPI), is the owner of agricultural lands. In 2000, HPI was renamed as
HRC. In December 2003, HRC's application for the conversion of its agricultural lands
into agri-industrial use was approved. In 2001, complainants were absorbed by HRC,
but they were working under the contractor-growers: Buenaventura Tano (Bit Farm);
Djerame Pausa (Djevon Farm); and Ramon Q. Laurente (Raquilla Farm).
On 1 July 2007, complainants formed their union NAMABDJERA-HRC, which was later
registered with the Department of Labor and Employment (DOLE). On 24 August
2007, NAMABDJERA-HRC filed a petition for certification election before the DOLE.
When HRC learned that complainants formed a union, the three contractor-growers
filed with the DOLE a notice of cessation of business operations. In September 2007,
complainants were terminated from their employment on the ground of cessation of
business operations by the contractor-growers of HRC.
On 19 September 2007, complainants, represented by NAMABDJERA-HRC, filed a
case for unfair labor practices, illegal dismissal, and illegal deductions with prayer
for moral and exemplary damages and attorney's fees before the NLRC. On 19
November 2007, DOLE Med-Arbiter Lito A. Jasa issued an Order, dismissing
NAMABDJERA-HRC's petition for certification election on the ground that there was
no employer-employee relationship between complainants and HRC. Complainants
did not appeal the Order of Med-Arbiter but pursued the illegal dismissal case they
filed.
On 4 January 2008, HRC filed a motion to dismiss the complaint for illegal dismissal.
The motion to dismiss was anchored on the following arguments: (1) Lack of
jurisdiction under the principle of res judicata; and (2) The Order of the Med-Arbiter
finding that complainants were not employees of HRC, which complainants did not
appeal, had become final and executory.
On 5 February 2008, Labor Arbiter Sagmit denied the motion to dismiss and held
that res judicata does not apply. ((The Labor Arbiter ruled that the decision of the
Med-Arbiter in a certification election case, by the nature of that proceedings does
not foreclose further dispute between the parties as to the existence or non-
existence of employer-employee relationship between them. Thus, the finding of
Med-Arbiter that no employment relationship exists between HRC and complainants
does not bar the Labor Arbiter from making his own independent finding on the
same issue. The non-litigious nature of the proceedings before the Med-Arbiter does
not prevent the Labor Arbiter from hearing and deciding the case.))
HRC filed with the NLRC a petition for certiorari with a prayer for temporary
restraining order, seeking to nullify the Orders of Labor Arbiter. The NLRC granted
the petition.
((The NLRC held that the Med-Arbiter Order dismissing the certification election case
on the ground of lack of employer-employee relationship between HRC and
complainants (members of NAMABDJERA-HRC) constitutes res judicata under the
concept of conclusiveness of judgment, and thus, warrants the dismissal of the case.
The NLRC ruled that the Med-Arbiter exercises quasi-judicial power and the Med-
Arbiter's decisions and orders have, upon their finality, the force and effect of a final
judgment within the purview of the doctrine of res judicata.))
The CA reversed the NLRCs Resolution. ((Under Article 217 of the Labor Code, the
Labor Arbiter has original and exclusive jurisdiction over illegal dismissal cases.
Although the proceedings before the Labor Arbiter are also described as non-
litigious, the Court of Appeals noted that the Labor Arbiter is given wide latitude in
ascertaining the existence of employment relationship. Hence, the Court of Appeals
concluded that the decision in a certification election case does not foreclose further
dispute as to the existence or non-existence of an employer-employee relationship
between HRC and the complainants.))
ISSUE: Whether the Labor Arbiter, in the illegal dismissal case, is bound by the
ruling of the Med-Arbiter regarding the existence or non-existence of employer-
employee relationship between the parties in the certification election case.
HELD: No. As found by the Court of Appeals, the facts in this case are very similar to
those in the Sandoval case, which also involved the issue of whether the ruling in a
certification election case on the existence or non-existence of an employer-
employee relationship operates as res judicata in the illegal dismissal case filed
before the NLRC. In Sandoval, the DOLE Undersecretary reversed the finding of the
Med-Arbiter in a certification election case and ruled that there was no employer-
employee relationship between the members of the petitioner union and Sandoval
Shipyards, Inc. (SSI), since the former were employees of the subcontractors.
Subsequently, several illegal dismissal cases were filed by some members of the
petitioner union against SSI. Both the Labor Arbiter and the NLRC ruled that there
was no employer-employee relationship between the parties, citing the resolution of
the DOLE Undersecretary in the certification election case. The Court of Appeals
reversed the NLRC ruling and held that the members of the petitioner union were
employees of SSI. On appeal, this Court affirmed the appellate court's decision and
ruled that the Labor Arbiter and the NLRC erred in relying on the pronouncement of
the DOLE Undersecretary that there was no employer-employee relationship
between the parties. The Court cited the ruling in the Manila Golf11 case that the
decision in a certification election case, by the very nature of that proceeding, does
not foreclose all further disputes between the parties as to the existence or non-
existence of an employer-employee relationship between them. This case is different
from the Chris Garments case cited by the NLRC where the Court held that the
matter of employer-employee relationship has been resolved with finality by the
DOLE Secretary, whose factual findings were not appealed by the losing party. As
mentioned earlier, the Med-Arbiter's order in this case dismissing the petition for
certification election on the basis of non-existence of employer-employee
relationship was issued after the members of the respondent union were dismissed
from their employment. The purpose of a petition for certification election is to
determine which organization will represent the employees in their collective
bargaining with the employer.12The respondent union, without its member-
employees, was thus stripped of its personality to challenge the Med-Arbiter's
decision in the certification election case. Thus, the members of the respondent
union were left with no option but to pursue their illegal dismissal case filed before
the Labor Arbiter. To dismiss the illegal dismissal case filed before the Labor Arbiter
on the basis of the pronouncement of the Med-Arbiter in the certification election
case that there was no employer-employee relationship between the parties, which
the respondent union could not even appeal to the DOLE Secretary because of the
dismissal of its members, would be tantamount to denying due process to the
complainants in the illegal dismissal case. This, we cannot allow.