LABOR LAW REVIEW

2015 – 2016

LECTURE FOR JUNE 30, 2015

Article 219 (Formerly, Article 212)

The term “collective bargaining unit” was not given any definition by Article 219.
However, the Supreme Court, in several cases, has provided us with the fundamental factors
determining the appropriate collective bargaining unit and these are: (1) the will of the
employees, (2) affinity and unity of the employees' interest, such as substantial similarity of
work and duties, or similarity of compensation and working conditions (Substantial Mutual
Interests Rule), (3) prior collective bargaining history, and similarity of employment status. The
existence of prior collective bargaining history is neither decisive nor conclusive in the
determination of what constitutes an appropriate bargaining unit. The “Globe Doctrine”
originated from the Globe Machine & Stamping Co. case (3 NLRB 294) cited for several times
as jurisprudential reference in the subsequent case decided by the Supreme Court including the
case of MECHANICAL DEPARTMENT LABOR UNION SA PHILIPPINE NATIONAL
RAILWAYS, petitioner, vs. COURT OF INDUSTRIAL RELATIONS, and SAMAHAN NG MGA
MANGGAGAWA SA CALOOCAN SHOPS, respondents, G.R. No. L-28223, August 30, 1968
where the Supreme Court held:

In view of its findings and the history of union representation in the railway
company, indicating that bargaining units had been formed through separation of
new units from existing ones whenever plebiscites had shown the workers' desire to
have their own representatives, and relying on the "Globe doctrine" (Globe
Machine & Stamping Co., 3 NLRB 294) applied in Democratic Labor Union vs.
Cebu Stevedoring Co., L-10321, 28 February 1958, Judge Martinez held that the
employees in the Caloocan Shops should be given a chance to vote on whether
their group should be separated from that represented by the Mechanical
Department Labor Union, and ordered a plebiscite held for the purpose. The
ruling was sustained by the Court en banc; wherefore, the Mechanical Department
Labor Union, appealed to this Court, questioning the applicability under the
circumstances of the "Globe doctrine" of considering the will of the employees in
determining what union should represent them.

Article 224 (Formerly, Article 217) – Thejurisdiction of Labor Arbiters and the
National Labor Relations Commission (NLRC).

In addition to disputes enumerated in Article 224, the claims arising out of an employer –
employee relationship or by virtue of any law or contract involving Filipino workers for
overseas deployment including claims for actual, moral, exemplary and other forms of damages
shall fall under the jurisdiction of the Labor Arbiter as provided in Section 10, Republic Act
8042.

The Commission shall have exclusive appellate jurisdiction over all cases decided by
Labor Arbiters.
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Under Article 217(now 224), it is clear that a labor arbiter has original and
exclusive jurisdiction over termination disputes. On the other hand, under Article
261(now 272), a voluntary arbitrator has original and exclusive jurisdiction over
grievances arising from the interpretation or enforcement of company policies.As a
general rule then, termination disputes should be brought before a labor arbiter,
except when the parties, under Art. 262(now 273) unmistakably express that they
agree to submit the same to voluntary arbitration. (Negros Metal Corp. vs. Armelo
J. Lamayo, G.R. No. 186557, August 25, 2010)

The disputes involving claims of Filipino seafarers wherein the parties are covered
by a collective bargaining agreement, the dispute or claim should be submitted to
the jurisdiction of a voluntary arbitrator or panel of arbitrators. It is only in the
absence of a collective bargaining agreement that parties may opt to submit the
dispute to either the NLRC or to voluntary arbitration. It is elementary that rules
and regulations issued by administrative bodies to interpret the law which they are
entrusted to enforce, have the force of law, and are entitled to great respect. Such
rules and regulations partake of the nature of a statute and are just as binding as if
they have been written in the statute itself. (Estate of Nelson R. Dulay vs.
AboitizJebsen Maritime, Inc., et al., G.R. No. 172642, June 13, 2012)

As a rule, labor arbiters and the National Labor Relations Commission have no
power or authority to grant reliefs from claims that do not arise from employer-
employee relations. They have no jurisdiction over torts that have no reasonable
causal connection to any of the claims provided for in the Labor Code, other labor
statutes, or collective bargaining agreements.

While it is true that labor arbiters and the NLRC have jurisdiction to award not
only reliefs provided by labor laws, but also damages governed by the Civil Code,
these reliefs must still be based on an action that has a reasonable causal
connection with the Labor Code, other labor statutes, or collective bargaining
agreements. (Evelyn Tolosa vs. NLRC, G.R. No. 149578, April 10, 2003)

Not every controversy or money claim by an employee against the employer or

vice-versa is within the exclusive jurisdiction of the labor arbiter. A money claim
by a worker against the employer or vice-versa is within the exclusive jurisdiction
of the labor arbiter only if there is a "reasonable causal connection" between the
claim asserted and employee-employer relation. Absent such a link, the complaint
will be cognizable by the regular courts of justice. 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.(Eduardo G. Eviota vs. Court of
Appeals, G.R. No. 152121, July 29, 2003)

We disfavor delay in the enforcement of the labor arbiter's decision. Once a

judgment becomes final and executory, the prevailing party should not be denied
the fruits of his victory by some subterfuge devised by the losing party. Final and
executory judgments can neither be amended nor altered except for correction of
clerical errors, even if the purpose is to correct erroneous conclusions of fact or of
law. Trial and execution proceedings constitute one whole action or suit such that
a case in which execution has been issued is regarded as still pending so that all
proceedings in the execution are proceedings in the suit. (Marmosy Trading, Inc.,
et al. vs. Court of Appeals, et al., G.R. No. 170515May 6, 2010)
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A labor arbiter may only take cognizance of a case and award damages where the
claim for such damages arises out of an employer-employee relationship.
(RoniloSorreda vs. Cambridge Electronics Corp., G.R. No. 172927, February 11,
2010)

Article 225 – The powersof the National Labor Relations Commission.

The NLRC does not enjoy exclusive and original jurisdiction over labor disputes. It
shall have appellate jurisdiction over the decisions, orders and awards of the Labor
Arbiters.

The NLRC, however, can promulgate its own rules, issue temporary restraining order that
is valid for twenty (20) days, issue preliminary injunction, hold any person in contempt directly
or indirectly and impose appropriate penalties therefor in accordance with law. That the
reception of evidence for the application of a writ of injunction may be delegated by the
Commission to any of its Labor Arbiters who shall conduct such hearings in such places as he
may determine to be accessible to the parties and their witnesses and shall submit thereafter his
recommendation to the Commission.

The NLRC has the power to decide case certified for compulsory arbitration by the
Secretary of Labor and Employment as provided in Article 277 (g) of the Labor Code.

Article 227 – TechnicalRules Not Binding and Prior Resort to Amicable Settlement

In proceedings before the NLRC or a labor arbiter, technical rules of procedure

and evidence are not binding. Even under the revised rules of the NLRC an
expeditious procedure is provided for. Simplification of procedure, without regard
to technicalities of law or procedure and without sacrificing the fundamental
requisites of due process, is mandated to insure a speedy administration of social
justice. This Court construed Article 221 (now 227)of the Labor Code as to allow
the NLRC or a labor arbiter to decide a case on the basis of position papers and
other documents submitted without resorting to technical rules of evidence as
observed in regular courts of justice. (Robusta Agro Marine Products, Inc. vs.
BaltazarGorombalem, G.R. No. 80500, July 5, 1989)

In a number of cases, this Court has construed Article 221 (227) of the Labor Code
as permitting the NLRC or the LA to decide a case on the basis of position papers
and other documents submitted without necessarily resorting to technical rules of
evidence as observed in the regular courts of justice. Rules of evidence are not
strictly observed in proceedings before administrative bodies like the NLRC.
(Lepanto Consolidated Mining Co. vs. Moreno Dumapis, et al., G.R. No. 163210,
August 13, 2008)

Article 228 – Appearances and Fees

(a) Non-lawyers may appear before the Commission or any Labor Arbiter only:

1. If they represent themselves; or

2. If they represent their organization or members thereof.
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(b) No attorney’s fees, negotiation fees or similar charges of any kind arising from
any collective bargaining negotiations or conclusion of the collective agreement shall be
imposed on any individual member of the contracting union: Provided, however, that attorney's
fees may be charged against union funds in an amount to be agreed upon by the parties. Any
contract, agreement or arrangement of any sort to the contrary shall be null and void.

Article 222 (now 228)of the Labor Code requiring an individual written
authorization as a prerequisite to wage deductions seeks to protect the employee
against unwarranted practices that would diminish his compensation without his
knowledge and consent. However, for all intents and purposes, the deductions
required of the petitioner and the employees do not run counter to the express
mandate of the law since the same are not unwarranted or without their knowledge
and consent. Also, the deductions for the union service fees in question are
authorized by law and do not require individual check-off authorizations. (Radio
Communications of the Phils. vs. Sec. of Labor and Employment, G.R. No.
77959, January 9, 1989)

The Court reads Article 222(b) (now 228 (b))of the Labor Code as prohibiting the
payment of attorney's fees only when it is effected through forced contributions
from the workers from their own funds as distinguished from the union
funds.(Bank of the Phil. Islands Employees Union vs. NLRC, G.R. No. 69746-47,
March 31, 1989)

Article 222 (b) (now 228 – b)prohibits attorney's fees, negotiations fees and
similar charges arising out of the conclusion of a collective bargaining agreement
from being imposed on any individual union member. The collection of the special
assessment partly for the payment for services rendered by union officers,
consultants and others may not be in the category of "attorney's fees or
negotiations fees.” But there is no question that it is an exaction which falls within
the category of a "similar charge," and, therefore, within the coverage of the
prohibition in the aforementioned article.(Carmelito L. Palacol vs. PuraFerrer-
Calleja, G.R. No. 85333, February 26, 1990)

LECTURE FOR JULY 2, 2015

Article 229 (Formerly, Article 223) – Appeal

Since the 10-day period provided in Article 223 (229)of the Labor Code refers to
ten calendar days and not to ten working days, this means that Saturdays, Sundays
and Legal Holidays are not to be excluded, but included, in the computation of the
10-day period. This is in line with the objective of the law for speedy disposition of
labor cases with the end in view of protecting the interest of the workingman. In
subsequent cases, We ruled that if the tenth day to perfect an appeal from the
decision of the Labor Arbiter to the NLRC falls on a Saturday, the appeal shall be
made on the next working day, as embodied in Section 1, Rule VI of the NLRC
Rules of Procedure promulgated on January 14, 1992. This conclusion arrived at
by the Court recognizes the fact that on Saturdays the offices of NLRC and certain
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post offices are closed.(Judy Phils., Inc. vs. NLRC, G.R. No. 111934, April 29,
1998)

Article 223 (229)(3rd paragraph) of the Labor Code, as amended by Section 12 of

Republic Act No. 6715, and Section 2 of the NLRC Interim Rules on Appeals under
RA No. 6715, Amending the Labor Code, provide that an order of reinstatement by
the Labor Arbiter is immediately executory even pending appeal.(Alejandro
Roquero vs. Philippine Airlines, Inc., G.R. No. 152329, April 22, 2003)

The intention of the 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 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
employer's appeal may be considered completed. The law however does not
require its outright payment, but only the posting of a bond to ensure that the
award will be eventually paid should the appeal fail. What petitioners have to pay
is a moderate and reasonable sum for the premium of such bond. (Accessories
Specialist, Inc., et al. vs. Erlinda B. Alabanza, G.R. No. 168985, July 23, 2008)

The posting of a cash or surety bond is a requirement sine qua non for the
perfection of an appeal from the labor arbiter's monetary award. The posting of a
bond within the period provided by law is not merely mandatory but jurisdictional.
Failure to perfect an appeal has the effect of rendering the judgment final and
executory. (Benjamin S. Santos vs. Elena Velarde, G.R. No. 140753, April 30,
2003)

The requirement for posting the surety bond is not merely procedural but
jurisdictional and cannot be trifled with. Non-compliance with such legal
requirements is fatal and has the effect of rendering the judgment final and
executory. (Hilario S. Ramirez vs. Court of Appeals, et al., G.R. No. 182626,
December 4, 2009)

The requirement that the employer post a cash or surety bond to perfect its/his
appeal is apparently intended to assure the workers that if they prevail in the case,
they will receive the money judgment in their favor upon the dismissal of the
employer's appeal. It was intended to discourage employers from using an appeal
to delay, or even evade, their obligation to satisfy their employees' just and lawful
claims.

While the bond requirement on appeals involving monetary awards has been
relaxed in certain cases, this can only be done where there was substantial
compliance of the NLRC Rules of Procedure or where the appellants, at the very
least, exhibited willingness to pay by posting a partial bond or where the failure to
comply with the requirements for perfection of appeal was justified.(Philux, Inc.,
et al. vs. NLRC, et al., G.R. No. 151854, September 3, 2008)

Time and again, however, this Court, considering the substantial merits of the
case, has relaxed this rule on, and excused the late posting of, the appeal bond
when there are strong and compelling reasons for the liberality, such as the
prevention of miscarriage of justice extant in the case or the special circumstances
in the case combined with its legal merits or the amount and the issue involved.
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After all, technical rules cannot prevent courts from exercising their duties to
determine and settle, equitably and completely, the rights and obligations of the
parties. This is one case where the exception to the general rule lies.
(MarticioSemblante, et al. vs. Court of Appeals, 19th Division, et al., G.R. No.
196426, August 15, 2011)

While Section 6, Rule VI of the NLRC's New Rules of Procedure allows the
Commission to reduce the amount of the bond, the exercise of the authority is not a
matter of right on the part of the movant, but lies within the sound discretion of the
NLRC upon a showing of meritorious grounds. It is daylight-clear from the
foregoing that while the bond may be reduced upon motion by the employer, this is
subject to the conditions that (1) the motion to reduce the bond shall be based on
meritorious grounds; and (2) a reasonable amount in relation to the monetary
award is posted by the appellant; otherwise, the filing of the motion to reduce bond
shall not stop the running of the period to perfect an appeal. The qualification
effectively requires that unless the NLRC grants the reduction of the cash bond
within the 10-day reglementary period, the employer is still expected to post the
cash or surety bond securing the full amount within the said 10-day period.
(Hilario S. Ramirez vs. Court of Appeals, et al., G.R. No. 182626, December 4,
2009)

The Rules of Procedure of the NLRC allows the filing of a motion to reduce bond
subject to two conditions: (1) there is meritorious ground, and (2) a bond in a
reasonable amount is posted. The filing of a motion to reduce bond and
compliance with the two conditions stop the running of the period to perfect an
appeal. The NLRC has full discretion to grant or deny the motion to reduce bond,
and it may rule on the motion beyond the 10-day period within which to perfect an
appeal. Obviously, at the time of the filing of the motion to reduce bond and
posting of a bond in a reasonable amount, there is no assurance whether the
appellant's motion is indeed based on "meritorious ground" and whether the bond
he or she posted is of a "reasonable amount." Thus, the appellant always runs the
risk of failing to perfect an appeal. (Cesar V. Garcia, et al. vs. KJ Commercial, et
al., G.R. No. 196830, February 29, 2012)

To clarify, the prevailing jurisprudence on the matter provides that the filing of a
motion to reduce bond, coupled with compliance with the two conditions
emphasized in Garcia v. KJ Commercial for the grant of such motion, namely, (1)
a meritorious ground, and (2) posting of a bond in a reasonable amount, shall
suffice to suspend the running of the period to perfect an appeal from the labor
arbiter's decision to the NLRC. To require the full amount of the bond within the
10-day reglementary period would only render nugatory the legal provisions
which allow an appellant to seek a reduction of the bond.

Although the general rule provides that an appeal in labor cases from a decision
involving a monetary award may be perfected only upon the posting of a cash or
surety bond, the Court has relaxed this requirement under certain exceptional
circumstances in order to resolve controversies on their merits. These
circumstances include: (1) the fundamental consideration of substantial justice; (2)
the prevention of miscarriage of justice or of unjust enrichment; and (3) special
circumstances of the case combined with its legal merits, and the amount and the
issue involved. Guidelines that are applicable in the reduction of appeal bonds
were also explained in Nicol v. Footjoy Industrial Corporation. The bond
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requirement in appeals involving monetary awards has been and may be
relaxed in meritorious cases, including instances in which (1) there was
substantial compliance with the Rules, (2) surrounding facts and circumstances
constitute meritorious grounds to reduce the bond, (3) a liberal interpretation of
the requirement of an appeal bond would serve the desired objective of resolving
controversies on the merits, or (4) the appellants, at the very least, exhibited their
willingness and/or good faith by posting a partial bond during the reglementary
period.(McBurnie v. Ganzon, G.R. Nos. 178034, 178117 & 186984-85, October
17, 2013 citing Garcia v. KJ Commercial, G.R. No. 196830, February 29, 2012)

In any event, the decision of the Labor Arbiter reinstating a dismissed or separated
employee, insofar as the reinstatement aspect is concerned, shall immediately be executory,
even pending appeal. The employee shall either be admitted back to work under the same terms
and conditions prevailing prior to his dismissal or separation or, at the option of the employer,
merely reinstated in the payroll. The posting of a bond by the employer shall not stay the
execution for reinstatement provided herein.

LECTURE FOR JULY 7, 2015

Article 232 – Bureau of Labor Relations

The BLR has the original and exclusive jurisdiction on all inter-union and intra-
union conflicts. We said that since Article 226 (232) of the Labor Code has
declared that the BLR shall have original and exclusive authority to act on all
inter-union and intra-union conflicts, there should be no more doubt as to its
jurisdiction. As defined, an intra-union conflict would refer to a conflict within or
inside a labor union, while an inter-union controversy or dispute is one occurring
or carried on between or among unions.(Emilio E. Diokno, et al. vs. Hans Leo J.
Cacdac, et al. G.R. No. 168475, July 4, 2007)

Section 226 (232)of the Labor Code clearly provides that the BLR and the
Regional Directors of DOLE have concurrent jurisdiction over inter-union and
intra-union disputes. Such disputes include the conduct or nullification of election
of union and workers' association officers. There is, thus, no doubt as to the BLR's
jurisdiction over the instant dispute involving member-unions of a federation
arising from disagreement over the provisions of the federation's constitution and
by-laws. (Allan S. Montaño vs. Ernesto C. Verceles, G.R. No. 168583, July 26,
2010)

Article 232 – Compromise Agreements

Not all waivers and quitclaims are invalid as against public policy. If the
agreement was voluntarily entered into and represents a reasonable settlement, it
is binding on the parties and may not later be disowned simply because of a
change of mind. It is only where there is clear proof that the waiver was wangled
from an unsuspecting or gullible person, or the terms of settlement are
unconscionable on its face, that the law will step in to annul the questionable
transaction, But where it is shown that the person making the waiver did so
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voluntarily, with full understanding of what he was doing, and the
consideration for the quitclaim is credible and reasonable, the transaction must be
recognized as a valid and binding undertaking.(Corazon Periquet vs. NLRC, G.R.
No. 91298, June 22, 1990)

While not all waivers and quitclaims are invalid as against public policy, one
made under circumstances of dire need and with a gross disparity between the
actual claim and the amount of the settlement cannot be countenanced by this
court.(B. Sta Rita And Co., Inc., vs. NLRC, G.R. No. 119617, August 14, 1995)

A compromise agreement is valid as long as the consideration is reasonable and

the employee signed the waiver voluntarily, with a full understanding of what he
was entering into. All that is required for the compromise to be deemed voluntarily
entered into is personal and specific individual consent. Thus, contrary to
respondent's contention, the employee's counsel need not be present at the time of
the signing of the compromise agreement. (J-Phil Marine, Inc., et al. vs. NLRC, et
al., G.R. No. 175366, August 11, 2008)

ASSIGNEMENT FOR JULY 9, 2015

ARTICLE 236 (231) – ARTICLE 276 (262 – B)

ATTY. VON LOVEL D. BEDONA

Professor