The Insular Life Assurance Co., Ltd.
, Employees regards readmission to work after the strike on the
Association - NATU, FGU Insurance Group
Workers and Employees Association - NATU,
and Insular Life Building Employees
Association - NATU, petitioners
vs.
The Insular Life Assurance Co., Ltd., FGU
Insurance Group, Jose M. Olbes, and Court of
Industrial Relations, respondents.
G.R. No. L-25291, January 20, 1971
FACTS:
The Insular Life Assurance Co., Ltd., Employees
Association - NATU, FGU Insurance Group Workers
and Employees Association - NATU, and Insular Life
Building Employees Association - NATU (herein
referred to as the Unions), while still members of the
Federation of Free Workers (FFW), entered into
separate collective bargaining agreements with the
Insular Life Assurance Co., Ltd., and the FGU
Insurance Group (herein referred to as the
Companies).
Two of the lawyers and officers of the Unions namely
Felipe Enaje and Ramon Garcia, tried to dissuade the
Unions from disaffiliating with the FFW and joining
the National Association of Trade Unions (NATU), to
no avail. Enaje and Garcia soon left the FFW and
secured employment with the Anti-Dummy Board of
the Department of Justice and were thereafter hired
by the companies - Garcia as assistant corporate
secretary and legal assistant, and Enaje as personnel
manager and chairman of the negotiating panel for
the Companies in the collective bargaining with the
Unions.
On October 1957, negotiations for the collective
bargaining was conducted but resulted to a deadlock.
From April 25 to May 6, 1958, the parties negotiated
on the labor demands but with no satisfactory results
due to the stalemate on the matter of salary
increases. This prompted the Unions to declare a
strike in protest against what they considered the
Companies unfair labor practices. On May 20, 1958,
the Unions went on strike and picketed the offices of
the Insular Life Building at Plaza Moraga.
On May 21, Jose M. Olbes, the acting manager and
president, sent individual letters to the striking
employees urging them to abandon their strike with a
promise of free coffee, movies, overtime pay, and
accommodations. He also warned the strikers if they
fail to return to work by a certain date, they might be
replaced in their jobs. Further, the Companies hired
men to break into the picket lines resulting in
violence, and the filing of criminal charges against
some union officers and members. When eventually,
the strikers called off their strike to return to their
jobs, they were subjected to a screening process by a
management committee, among the members were
Garcia and Enaje. After screening, eighty-three (83)
strikers were rejected due to pending criminal
charges, and adamantly refused readmission of thirty-
four (34) officials and members of the Unions who
were most active in the strike.
The CIR prosecutor filed a complaint for unfair labor
practice against the Companies, specifically (1)
interfering with the members of the Unions in the
exercise of their right to concerted action; and (2)
discriminating against the members of the Unions as
basis of their union membership and degree of
participation in the strike. After the trial, the Court of
Industrial Relations dismissed the Unions complaint
for lack of merit.
ISSUES:
I. Whether or not the Companies are
guilty of unfair labor practice when they
sent individual letters to the strikers
with the promise of additional benefits,
and notifying them to either return to
work, or lose their jobs; and
II. Whether or not the Companies are
guilty of unfair labor practice for
discriminating against the striking
members of the Unions in readmission
of employees after the strike.
HELD:
First issue.The Companies contended that by sending
those letters, it constituted a legitimate exercise of
their freedom of expression. That contention is
untenable. The Companies are guilty of unfair labor
practice when they sent individual letters to the
strikers.It is an act of interference with the right to
collective bargaining through dealing with the strikers
individually instead of through their collective
bargaining representatives. Although the Unions are
on strike, the employer is still obligated to bargain
with the union as the employees bargaining
representative. Further, it is also an act of
interference for the employer to send individual
letters to the employees notifying them to return to
their jobs, otherwise, they would be replaced.
Individual solicitation of the employees urging them
to cease union activity or cease striking consists of
unfair labor practice. Furthermore, when the
Companies offered to bribe the strikers with
comfortable cots, free coffee, and movies, overtime
work pay so they would abandon their strike and
return to work, it was guilty of strike-breaking and/or
union busting which constitute unfair labor practice.
Second Issue.Some of the members of the Unions
were refused readmission because they had pending
criminal charges. However, despite the fact they were
able to secure clearances, 34 officials and members
were still refused readmission on the alleged ground
that they committed acts inimical to the Companies.
It should be noted, however, that non-strikers who
also had criminal charges pending against them in the
fiscals office, arising from the same incidents whence
against the criminal charges against the strikers are
involved, were readily readmitted and were not
required to secure clearances. This is an act of
discrimination practiced by the Companies in the
process of rehiring and is therefore a violation of Sec.
4(a)(4) of the Industrial Peace Act.
The respondent Companies did not merely
discriminate against all strikers in general since they
separated the active rom the less active unionists on
the basis of their militancy, or lack of it, on the picket
lines. Discrimination exists where the record shows
that the union activity of the rehired strikers has been
less prominent than that of the strikers who were
denied reinstatement.
SHELL OIL
WORKERS UNION
vs. SHELL
COMPANY OF THE
PHILIPPINES,
LTD., and THE
COURT OF
INDUSTRIAL REL
ATIONS
OCTOBER 23, 2012 ~ VBDIAZ
SHELL OIL WORKERS
UNION vs. SHELL COMPANY
OF THE PHILIPPINES, LTD.,
and THE COURT OF
INDUSTRIAL RELATIONS
G.R. No. L-28607, May 31,
1971.
FACTS:
Respondent Shell Company of
the Philippines (COMPANY)
dissolved its security guard
section stationed at its
Pandacan Installation,
notwithstanding its (guard
section) continuance and that
such is assured by an existing
collective bargaining contract.
The respondent company
transferred 18 security guards
to its other department and
consequently hired a private
security agency to undertake
the work of said security
guards. This resulted in a strike
called by petitioner Shell Oil
Workers Union (UNION), The
President certified it to
respondent Court of Industrial
Relations (CIR). CIR declared
the strike illegal on the ground
that such dissolution was a
valid exercise of a
management prerogative. Thus
this appeal is taken.
Petitioner argued that the 18
security guards affected are
part of the bargaining unit and
covered by the existing
collective bargaining contract,
as such, their transfers and
eventual dismissals are illegal
being done in violation of the
existing contract. The Company
maintained that in contracting
out the security service and
redeploying the 18 security
guards affected, it was merely
performing its legitimate
prerogative to adopt the most
efficient and economical
method of operation, that said
action was motivated by
business consideration in line
with past established practice
and made after notice to and
discussion with the Union, that
the 18 guards concerned were
dismissed for wilfully refusing
to obey the transfer order, and
that the strike staged by the
Union is illegal.
ISSUE:
Whether the existing collective
bargaining contract on
maintaining security guard
section, among others,
constitute a bar to the decision
of the management to contract
out security guards.
RULING:
YES. The strike was legal
because there was a violation
of the collective bargaining
agreement by Company. It was
part of the CBA that the
Security Guard Section will
remain. Yet, the Company did
not comply with the stipulation
in CBA. It was thus an
assurance of security of tenure,
at least, during the lifetime of
the agreement. For what is
involved is the integrity of the
agreement reached, the terms
of which should be binding on
both parties
The stand of Shell Company as
to the scope of management
prerogative is not devoid of
plausibility, management
prerogative of the Company
would have been valid if it were
not bound by what was
stipulated in CBA. The freedom
to manage the business
remains with management. It
cannot be denied the faculty of
promoting efficiency and
attaining economy by a study
of what units are essential for
its operation. To it belongs the
ultimate determination of
whether services should be
performed by its personnel or
contracted to outside agencies.
However, while management
has the final say on such
matter, the labor union is not
to be completely left out.
An unfair labor practice is
committed by a labor union or
its agent by its refusal to
bargain collectively with the
employer. Collective
bargaining does not end with
the execution of an agreement,
being a continuous process, the
duty to bargain necessarily
imposing on the parties the
obligation to live up to the
terms of such a collective
bargaining agreement if
entered into, it is undeniable
that non-compliance therewith
constitutes an unfair labor
practice.
The right to self-organization
guarded by the Industrial Peace
Act explicitly includes the right
to engage in concerted
activities for the purpose of
collective bargaining and to the
mutual aid or protection. The
employee, tenant or laborer is
inhibited from striking or
walking out of his employment
only when so enjoined by the
CIR and after a dispute has
been submitted thereto and
pending award or decision by
the court of such dispute.
In the present case, the
employees or laborers may
strike before being ordered not
to do so and before an
industrial dispute is submitted
to the CIR, subject to the power
of the latter, after hearing
when public interest so
requires or when the dispute
cannot, in its opinion, be
promptly decided or settled, to
order them to return to work,
with the consequence that if
the strikers fail to return to
work, when so ordered, the
court may authorize the
employer to accept other
employees or laborers. Thus a
strike may not be staged only
when, during the pendency of
an industrial dispute, the CIR
has issued the proper
injunction against the laborers
(section 19, Commonwealth Act
No. 103, as amended).
WHEREFORE, the decision of
respondent Court of Industrial
Relations of August 5, 1967 is
reversed.
-
**NOTE:
BELIEF IN GOOD FAITH THAT
EMPLOYER COMMITTED UNFAIR
LABOR PRACTICE RENDERS
STRIKE LEGAL:
It is not even required that
there be in fact an unfair labor
practice committed by the
employer. It suffices, if such a
belief in good faith is
entertained by labor, as the
inducing factor for staging a
strike. So it was declared: As a
consequence, we hold that the
strike in question had been
called to offset what petitioners
were wanted in believing in
good faith to be unfair labor
practices on the part of
Management, that

petitioners were not bound,
therefore, to wait for the
expiration of thirty (30) days
from notice of strike before
staging the same, that said
strike was not, accordingly,
illegal and that the strikers had
not thereby lost their status as
employees of respondents
herein.
epublic of the Philippines
SUPREME COURT
Manila
THIRD DIVISION
G.R. No. 76989 September 29, 1987
MANILA MANDARIN EMPLOYEES
UNION, petitioners,
vs.
NATIONAL LABOR RELATIONS
COMMISSION, and MELBA C.
BELONCIO, respondents.
GUTIERREZ, JR., J.:
This is a petition to review on certiorari the
National Labor Relations Commission's
(NLRC) decision which modified the Labor
Arbiter's decision and ordered the Manila
Mandarin Employees Union to pay the wages
and fringe benefits of Melba C. Beloncio from
the time she was placed on forced leave until
she is actually reinstated, plus ten percent
(10%) thereof as attorney's fees. Manila
Mandarin Hotel was ordered to reinstate
Beloncio and to pay her whatever service
charges may be due her during that period,
which amount would be held in escrow by the
hotel.
The petition was filed on January 19, 1987.
The private respondent filed her comment on
March 7, 1987 while the Solicitor General filed
a comment on June 1, 1987 followed by the
petitioner's reply on August 22, 1987. We treat
the comment as answer and decide the case
on its merits.
The facts of the case are undisputed.
Herein private respondent, Melba C. Beloncio,
an employee of Manila Mandarin Hotel since
1976 and at the time of her dismissal,
assistant head waitress at the hotel's coffee
shop, was expelled from the petitioner Manila
Mandarin Employees Union for acts allegedly
inimical to the interests of the union. The
union demanded the dismissal from
employment of Beloncio on the basis of the
union security clause of their collective
bargaining agreement and the Hotel acceded
by placing Beloncio on forced leave effective
August 10, 1984.
The union security clause of the collective
bargaining agreement provides:
Section 2. Dismissals.
xxx xxx xxx
b) Members of the Union who
cease to be such members
and/or who fail to maintain
their membership in good
standing therein by reason of
their resignation from the
Union and/or by reason of
their expulsion from the
Union in accordance with the
Constitution and By-Laws of
the Union, for non-payment of
union dues and other
assessment for organizing,
joining or forming another
labor organization shall, upon
written notice of such
cessation of membership or
failure to maintain membership
in the Union and upon written
demand to the company by
the Union, be dismissed from
employment by the Company
after complying with the
requisite due process
requirement; ... (Emphasis
supplied) (Rollo, p. 114)
Two days before the effective date of her
forced leave or on August 8, 1984, Beloncio
filed a complaint for unfair labor practice and
illegal dismissal against herein petitioner-
union and Manila Mandarin Hotel Inc. before
the NLRC, Arbitration Branch.
Petitioner-union filed a motion to dismiss on
grounds that the complainant had no cause of
action against it and the NLRC had no
jurisdiction over the subject matter of the
complaint.
This motion was denied by the Labor Arbiter.
After the hearings that ensued and the
submission of the parties' respective position
papers, the Labor Arbiter held that the union
was guilty of unfair labor practice when it
demanded the separation of Beloncio. The
union was then ordered to pay all the wages
and fringe benefits due to Beloncio from the
time she was on forced leave until actual
reinstatement, and to pay P30,000.00 as
exemplary damages and P10,000.00 as
attorney's fees. The charge against the hotel
was dismissed.
CBA, membership in the union may be lost
through expulsion only if there is non-payment
of dues or a member organizes, joins, or
forms another labor organization. The charge
of disloyalty against Beloncio arose from her
emotional remark to a waitress who happened
to be a union steward, "Wala akong tiwala sa
Union ninyo." The remark was made in the
course of a heated discussion regarding
Beloncio's efforts to make a lazy and
recalcitrant waiter adopt a better attitude
towards his work.

The Union then appealed to the respondent We agree with the Solicitor General when he
NLRC which modified the Labor Arbiter's noted that:
decision as earlier stated.
... The Labor Arbiter explained
A subsequent motion for reconsideration and correctly that "(I)f the only
a second motion for reconsideration were question is the legality of the
denied. expulsion of Beloncio from the
Union undoubtedly, the
Hence, this present petition. question is one cognizable by
the BLR (Bureau of Labor
The petitioner raises the following assignment Relations). But, the question
of errors: extended to the dismissal of
Beloncio or steps leading
thereto. Necessarily, when the
I
hotel decides the
recommended dismissal, its
THAT RESPONDENT NLRC acts would be subject to
ERRED IN NOT DECLARING scrutiny. Particularly, it will be
THAT THE PRESENT asked whether it violates or
CONTROVERSY INVOLVED not the existing CBA.
INTRA-UNION CONFLICTS Certainly, violations of the CBA
AND THEREFOR IT HAS NO would be unfair labor practice."
JURISDICTION OVER THE
SUBJECT-MATTER
Article 250 of the Labor Code
THEREOF.
provides the following:
II
Art. 250. Unfair
labor practices
THAT RESPONDENT NLRC of labor
SERIOUSLY ERRED IN organizations.
HOLDING PETITIONER It shall be
LIABLE FOR THE PAYMENT unfair labor
OF PRIVATE practice for a
RESPONDENT'S SALARY labor
AND FRINGE BENEFITS, organization,
AND AWARD OF 10% its officers,
ATTORNEY'S FEES, AFTER agents or
FINDING AS representatives
UNMERITORIOUS HER :
PRETENDED CLAIMS OR
COMPLAINTS FOR UNFAIR
xxx xxx xxx
LABOR PRACTICE, ILLEGAL
DISMISSAL, AND DAMAGES.
(Rollo, pp. 6-9) (b) To cause or
attempt to
cause an
On the issue of the NLRC jurisdiction over the
employer to
case, the Court finds no grave abuse of
discriminate
discretion in the NLRC conclusion that the
against an
dispute is not purely intra-union but involves
employee,
an interpretation of the collective bargaining
including
agreement (CBA) provisions and whether or
discrimination
not there was an illegal dismissal. Under the
 against an The petitioner also questions the factual
employee with findings of the public respondent on the
respect to reasons for Beloncio's dismissal and,
whom especially, on the argument that she was on
membership in forced leave; she was never dismissed; and
such not having worked, she deserved no pay.
organization
has been The Court finds nothing in the records that
denied or to indicates reversible error, much less grave
terminate an abuse of discretion, in the NLRC's findings of
employee on facts.
any ground
other than the It is a well-settled principle that findings of
usual terms facts quasi-judicial agencies like the NLRC,
and conditions which have acquired expertise because their
under which jurisdiction is confined to specific matters, are
membership or generally accorded not only respect but at
continuation of times even finality if such findings are
membership is supported by substantial evidence. (Akay
made available Printing Press vs. Minister of Labor and
to other Employment, 140 SCRA 381; Alba Patio de
members. Makati vs. Alba Patio de Makati Employees
(Emphasis Association, 128 SCRA 253; Dangan vs.
supplied) National Labor Relations Commission, 127
SCRA 706; De la Concepcion vs. Mindanao
Article 217 of the Labor Code Portland Cement Corporation, 127 SCRA
also provides: 647).

Art. 217. The petitioner now questions the decision of

Jurisdiction of the National Labor Relations Commission
Labor Arbiters ordering the reinstatement of the private
and the respondent and directing the Union to pay the
Commission wages and fringe benefits which she failed to
(a) The receive as a result of her forced leave and to
Labor Arbiters pay attorney's fees.
shall have the
original and We find no error in the questioned decision.
exclusive
jurisdiction to
The Hotel would not have compelled Beloncio
hear and
to go on forced leave were it not for the
decide ... the
union's insistence and demand to the extent
following cases
that because of the failure of the hotel to
involving all
dismiss Beloncio as requested, the union filed
workers,
a notice of strike with the Ministry of Labor
whether
and Employment on August 17, 1984 on the
agricultural or
issue of unfair labor practice. The hotel was
nonagricultural;
then compelled to put Beloncio on forced
leave and to stop payment of her salary from
(1) Unfair labor September 1, 1984.
practice cases;
Furthermore, as provided for in the collective
xxx xxx xxx bargaining agreement between the petitioner-
the Union and the Manila Mandarin Hotel "the
(b) The Union shall hold the Company free and
Commission blameless from any and all liabilities that may
shall have arise" should the employee question the
exclusive dismissal, as has happened in the case at bar.
appellate
jurisdiction It is natural for a union to desire that all
over all cases workers in a particular company should be its
decided by dues-paying members. Since it would be
Labor Arbiters. difficult to insure 100 percent membership on
(Rollo, pp. 155- a purely voluntary basis and practically
157.) impossible that such total membership would
continuously be maintained purely on the
merits of belonging to the union, the labor
movement has evolved the system whereby
the employer is asked, on the strength of
collective action, to enter into what are now
familiarly known as "union security"
agreements.
its employees, and the general public whom
they serve.
WHEREFORE, the petition is hereby
DISMISSED. The questioned decision of the
National Labor Relations Commission is
AFFIRMED. Costs against the petitioner.

The collective bargaining agreement in this SO ORDERED.

case contains a union security clause a
closed-shop agreement.
Manila Mandarin EU vs. NLRC & Beloncio
A closed-shop agreement is an agreement
whereby an employer binds himself to hire
only members of the contracting union who
must continue to remain members in good
standing to keep their jobs. It is "the most
prized achievement of unionism." It adds
membership and compulsory dues. By holding
out to loyal members a promise of
employment in the closed-shop, it welds group
solidarity. (National Labor Union vs.
Aguinaldo's Echague, Inc., 97 Phil. 184). It is
a very effective form of union security
agreement.

This Court has held that a closed-shop is a

valid form of union security, and such a
provision in a collective bargaining agreement
is not a restriction of the right of freedom of
association guaranteed by the Constitution.
(Lirag Textile Mills, Inc. vs. Blanco, 109 SCRA
87; Manalang vs. Artex Development
Company, Inc., 21 SCRA 561).

The Court stresses, however, that union

security clauses are also governed by law and
by principles of justice, fair play, and legality.
Union security clauses cannot be used by
union officials against an employer, much less
their own members, except with a high sense
of responsibility, fairness, prudence, and
judiciousness.

A union member may not be expelled from her

union, and consequently from her job, for
personal or impetuous reasons or for causes
foreign to the closed-shop agreement and in a
manner characterized by arbitrariness and
whimsicality.

This is particularly true in this case where Ms.

Beloncio was trying her best to make a hotel
bus boy do his work promptly and courteously
so as to serve hotel customers in the coffee
shop expeditiously and cheerfully. Union
membership does not entitle waiters, janitors,
and other workers to be sloppy in their work,
inattentive to customers, and disrespectful to
supervisors. The Union should have
disciplined its erring and troublesome
members instead of causing so much
hardship to a member who was only doing her
work for the best interests of the employer, all